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Federal Court in New Mexico OKs Drilling in Mancos Shale; Enviros Push Back

Oil and natural gas activity in a contentious part of the Mancos Shale can continue, a federal district judge in New Mexico decreed Friday in rejecting an injunction request from Navajo and environmental group attorneys for tribal and federal-managed lands near the Chaco Culture National Historical Park.

The action emboldened activists who brought the legal action against the federal Bureau of Land Management (BLM). On Tuesday, a coalition of environmental groups delivered anti-hydraulic fracturing (fracking) petitions with 165,000 signatures to the offices of New Mexico congressional representatives, calling for an immediate halt to fracking in the Mancos Shale in the northwest corner of the state and the south end of the San Juan Basin. On Tuesday, the groups filed an appeal to the rejection of their injunction request.

At a hearing in July, U.S. District Judge James Browning in the U.S. District Court for the District of New Mexico said he would rule on the injunction this month (see Shale DailyJuly 17). Browning heard arguments from the Navajo group Dine Citizens Against Ruining our Environment, WildEarth Guardians and the Natural Resources Defense Council, among others. The groups sought a temporary injunction to halt ongoing development and force the BLM to reassess environmental impacts, claiming full-scale development was allowed to begin "despite the absence of a required programmatic plan and environmental review."

Producers such as BP America, ConocoPhillips, Encana Corp. and WPX Energy Inc., which are developing acreage in the Mancos trend, joined the lawsuit in support of BLM.

"While this decision is discouraging, we believe that BLM has failed the public and continues piecemeal approval of new oil development, neglecting cumulative impacts, resulting in significant flaring waste and industrializing the landscape,” said Mike Eisenfeld, New Mexico coordinator for the San Juan Citizens Alliance. "This is not over; we will reassess and challenge the injustice."

After weighing the evidence, Browning concluded that the Mancos development "is consistent with prior planning and analysis from BLM, and site-specific analysis is taking place for additional wells, providing adequate protection for the environment and allowing development, giving BLM time to modify its long-term resource management plan [RMP]," said Steve Henke, president of the New Mexico Oil and Gas Association.

Henke told NGI's Shale Daily that the judge's injunction ruling lays the groundwork for requiring the plaintiffs "to come to the dance with more than just an argument that says 'we don't like it' if and when the case comes to trial.” Henke said he hopes the groups will withdraw the case because he thinks they will have a difficult time proving their case longer term.

"There wasn't much evidence presented so far that the impacts are not being mitigated," he said. "BLM is going forward with a revised RMP and draft environmental impact statement, so they could come out with those before there is further court action."

Western Energy Alliance's Kathleen Sgamma said the environmental analysis that environmental groups are compelling BLM to conduct is "another layer of analysis, but BLM's regulations and the law don't support stopping all economic activity while BLM takes five years to do another NEPA [National Environmental Policy Act] analysis."

Browning said, "The oil and gas industry is an enormous job-creator and economic engine in New Mexico, and shutting down portions of it based on speculation about unproven environmental harms is against the public interest." He said the operators would "suffer more harm" from an injunction than the plaintiffs would from a denial of their request.

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