On June 21, 2016, the U.S. District Court for the District of Wyoming (“District Court”) set aside the U.S. Department of the Interior, Bureau of Land Management’s (“BLM’s”) “Hydraulic Fracturing on Federal and Indian Lands” rule, finding that the rule exceeded BLM’s statutory authority. Challengers to the rule previously succeeded in obtaining a preliminary injunction in September 2015, pending a final decision on the merits of the case. In the merits decision issued this week, the District Court held that “Congress has not delegated to the Department of Interior the authority to regulate hydraulic fracturing.”
The BLM rule would have, among other requirements, mandated that operators planning to conduct hydraulic fracturing on federal and Indian lands: (1) submit detailed information regarding the proposed operation, including wellbore geology information and the estimated length of fracture propagation; (2) design and implement a casing and cementing program that meets certain best management practices and performance standards; (3) manage recovered fluids in rigid enclosed, covered, or netted and screened aboveground storage tanks, with very limited exceptions; and (4) disclose the chemicals to be used in hydraulic fracturing to BLM and the public, with limited exceptions for trade secrets.
BLM is expected to appeal the District Court’s decision to the U.S. Court of Appeals for the Tenth Circuit.
The Department of the Interior has released its Statement of Regulatory Priorities, a subsection of which highlights the Bureau of Land Management (BLM)’s priorities on energy issues including hydraulic fracturing. BLM’s stated highest regulatory priorities include revising antiquated hydraulic fracturing regulations, preventing waste of produced oil and gas, and ensuring a fair return to the American taxpayer for oil shale development. BLM’s stated priorities also address solar and wind energy projects and the management of waste mine methane. The current regulatory agenda of the Department is also publicly available.
This week the U.S. House of Representatives voted to pass a trio of key energy bills. In addition to the bill that would limit federal regulation of hydraulic fracturing, the House also passed two bills that include provisions aimed at reforming federal permitting processes. By a vote of 228-192, the House passed the Federal Lands Jobs and Energy Security Act (HR 1965), which would, for example, require the Department of the Interior to decide on a federal lands drilling permit application within 60 days of receipt or the application would be deemed approved. Today, the House voted 252-165 to pass the Natural Gas Pipeline Permitting Reform Act (HR 1900), which would require the Federal Energy Regulatory Commission (FERC) to approve or deny a certificate of public convenience and necessity for a prefiled project within 12 months after receiving a complete application, and would also require other federal agencies to act on related licenses, permits or approvals within 90 days of FERC issuing an environmental impact statement. The Obama administration has reportedly threatened to veto all three bills.
In order to fill vacancies at the Department of the Interior, President Obama recently nominated Janice Schneider as Assistant Secretary for Land and Minerals Management, a move welcomed by Secretary Sally Jewell. Currently an environment and energy lawyer in private practice in Washington, D.C., Schneider, if confirmed, will oversee all energy development activities on federal lands and supervise the Bureau of Land Management (BLM), the Bureau of Ocean Energy Management (BOEM), and the Bureau of Safety and Environmental Enforcement. Also nominated were Neil Kornze as Director of the BLM and Tommy Beaudreau as Assistant Secretary for Policy, Management, and Budget. Because Beaudreau currently serves as head of the BOEM, Secretary Jewell is expected to pick his replacement upon confirmation of his new role.
Despite criticism of FracFocus by several environmental and academic groups, the outgoing Deputy Secretary of the Interior Department recently suggested the FracFocus website may be an appropriate device for the public disclosure of chemicals used in hydraulic fracturing fluids while adequately protecting trade secrets. As reported by BNA’s Daily Environment Report, Deputy Secretary David Hayes, who is stepping down to take a teaching position at Stanford Law School, said that the Department of the Interior endorses the concept of a single registry throughout the country that contains as much information as possible. Hayes noted that although FracFocus is a work in progress, the Department of the Interior has been working closely with the FracFocus team to develop the disclosure platform.
FracFocus recently launched a major upgrade aimed at making the website more user-friendly. Twelve states currently require oil and gas producers to dislcose fracking chemicals on FracFocus. More states are expected to require use of FracFocus in the future.
The U.S. Department of the Interior has extended the comment period by 60 days for the revised proposed rules for hydraulic fracturing on federal lands. Interior Secretary Sally Jewell indicated that various interest groups had requested more time to review the 171-page proposal issued in May. The comment period was set to expire on June 24, 2013, but comments will now be accepted through late August.
On May 16, 2013, the U.S. Department of Interior announced the release of its updated draft rules for hydraulic fracturing on federal lands. The 30-day deadline for submitting comments on the new proposal will run from the date of publication of the draft rules in the Federal Register. Additional information on the development of the updated rules is available here.
Updating a previous post, this week Sally Jewell was reportedly approved by the Senate in a 87 to 11 vote to serve as the next Secretary of the U.S. Department of the Interior. Jewell will oversee over 500 million acres of national parks and public land, and over 1 billion acres offshore.
President Obama announced on February 6th that he has nominated Sally Jewell to be the next Secretary of the U.S. Department of the Interior. Ms. Jewell has been the president and CEO of outdoor retailer Recreational Equipment Inc. (REI) since 2005. Prior to joining REI, Ms. Jewell worked as an engineer for Mobil Oil Corp. for three years after graduating from college. She also spent nearly twenty years in the commercial banking industry, culminating with her becoming president of Washington Mutual’s commercial banking group. President Obama said that Ms. Jewell “knows the link between conservation and good jobs. She knows that there’s no contradiction between being good stewards of the land and our economic progress; that in fact, those two things need to go hand in hand.” Senate confirmation hearings will begin in the next few weeks.
On January 16, 2013, the U.S. Department of the Interior announced that its current Secretary, Ken Salazar, will leave his post in late March. As Secretary, Salazar steered an expansion of renewable energy projects on federal lands, overhauled the regulatory framework for offshore drilling following the 2010 BP spill in the Gulf of Mexico, and restructured the former Minerals Management Service, now the Bureau of Ocean Energy Management, Regulation and Enforcement. Salazar is a former Colorado Attorney General and United States Senator.