American Oil and Gas Reporter - June 2015 - 14

IndustryDigest
IPAA, Western Alliance
Petition Court To Freeze
BLM Fracturing Rule

WASHINGTON-Claiming that the
U.S. Bureau of Land Management's
rule-making process has failed to
consider relevant evidence and has not
justified its reasons for regulating
hydraulic fracturing on federal and
Indian lands, a couple oil and gas
groups are requesting a preliminary
injunction on the rule until legal
challenges are resolved.
Law firm BakerHostetler, which is
representing the Western Energy
Alliance and the Independent Petroleum
Association of America in the action,
says it has filed the motion in the U.S.
Court for the District of Wyoming.
Independent producers have been
incurring substantial compliance costs
well in advance of the regulation's
effective date of June 24, BakerHostetler
says, contending the rule has forced
producers to adjust drilling schedules,
move equipment, contract for operational
services, and train personnel. The motion
argues that producers anticipate the
additional costs of complying with the
rule will exceed several hundreds of
millions of dollars a year.
BLM has underestimated the cost of
the final rule at every phase of its
development, holds Mark Barron, one
of the attorneys heading the litigation.
"Given the magnitude of expected costs
and the legal flaws of the final rule,
injunctive relief is necessary to protect
independent producers until the court
reaches resolution," he says. "BLM
argues that some states with hydraulic
fracturing activity lack the regulations
necessary to protect federal and Indian
lands, but BLM has yet to identify a
single harm that the agency's rule will
prevent that state regulation isn't
preventing already."
The Western Alliance and IPAA
challenged the final rule when it was
filed on March 20 (AOGR, April 2015,
pg. 58). Wyoming also is suing BLM
over the regulation in a suit that has
been joined by North Dakota, Colorado
and Utah. ❒

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14 THE AMERICAN OIL & GAS REPORTER

Utah Joins Three States
In Lawsuit Opposing
BLM's Fracturing Rule

SALT LAKE CITY-Utah has joined
three other states in a lawsuit
challenging the Bureau of Land
Management's proposed hydraulic
fracturing regulations.
"There is no question the practice of
hydraulic fracturing should be regulated
in order to ensure protection of the
environment," said Governor Gary R.
Herbert in announcing Utah's decision
to join the lawsuit filed in March by the
state of Wyoming. "However, adopting
(BLM's) proposed rule would create an
inconsistent, costly and inefficient
regulatory system that provides no
additional environmental protection or
public safety than is offered by
programs already enforced by the
state."
Utah is joining Wyoming, North
Dakota and Colorado in challenging the
BLM rule. The lawsuit contends the
proposed regulations unlawfully
interfere with state rules that already
address the stimulation process, and
also will reduce energy production on
federal and tribal lands with no
demonstrable environmental or
administrative benefits (AOGR, April
2015, pg. 58).
"Utah has a strong regulatory system
for oil and gas development, including
hydraulic fracturing," Herbert says. "So
far, there have been no instances of
environmental damage in Utah related
to the integrity of a well undergoing
hydraulic fracturing. This is yet another
unfortunate example of federal
regulatory overreach. The only thing
this rule will achieve is more red tape,
more delays, fewer jobs, and less
revenue for both Utah and the federal
treasury."
Herbert says that according to some
estimates, the fracturing rule could cost
between $97,000 and $253,000 for each
well, cumulatively costing Utah as
much as $243 million annually. ❒

Green Groups Opposing
California Injection Wells
SACRAMENTO, CA.-A pair of
anti-development groups are suing the
California Division of Oil, Gas and
Geothermal Resources in an effort to
stop produced water reinjections, the

California Independent Petroleum
Association reports.
According to CIPA, the green groups
claim DOGGR is not authorized to let
companies reinject water produced from
aquifers that-until recently-have been
defined as exempt under the federal
Safe Drinking Water Act. The antidevelopment groups emphasize that the
U.S. Environmental Protection Agency
is seeking to review state regulators'
plan to update those exemptions under
California's underground injection
control program, CIPA says.
A Center for Biological Diversity
press release indicates that Earthjustice
filed the suit in Alameda County
Superior Court on behalf of CBD and
the Sierra Club. The press release
claims the lawsuit seeks "to halt illegal
oil industry operations that are dumping
millions of gallons of toxic oil waste a
day into California's dwindling
underground water supplies."
CIPA Chief Executive Officer Rock
Zierman emphasizes that EPA's
"exemption review" amounts to a
paperwork issue with an agency that has
overseen produced water reinjection for
decades without allowing it to taint
drinking water. "The EPA has asked the
state to help it update the paperwork
used to regulate the practice (of
injection), and the state has developed a
work plan to do so," he relates. "Those
are the facts."
According to a September 2014
executive director's report from the
State Water Resources Control Board,
DOGGR discovered in August 2014
that wastewater disposal wells appeared
to be injecting into protected sources of
groundwater, which prompted the
Central Valley Regional Board to issue
orders and begin cooperating with EPA
and DOGGR to investigate the
possibility of public water supplies
becoming contaminated.
"The Central Valley Regional Board
staff have sampled several wells in the
vicinity of the at-risk water supply
wells," the report states. "Thus far, the
test results indicate the injection wells
have not degraded groundwater quality
in the water supply wells tested."
CIPA stresses, "State regulators have
acknowledged their responsibility to
bring the UIC program into compliance
with the SDWA, as there were
discrepancies between what the state
and federal governments defined as
American Oil and Gas Reporter - June 2015

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