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Montana Leaseholder to Keep Fighting Interior Cancellations

The lead attorney for the Mountain States Legal Foundation (MSLF) told the U.S. District Court for the District of Columbia on Monday that Solenex LLC plans to file an amendment to its 2013 legal challenge of the U.S. Interior Department's inaction and eventual cancellations of 18 oil and gas leases on federal lands in Montana.

Attorney Steven Lechner said in his notice to the court that Interior's action earlier this month (see Daily GPIMarch 18) constitutes "unreasonable delay," which was the basis of Solenex's original legal call for relief. Lechner will file an amendment to that original filing by April 15, he told NGI on Tuesday.

MSLF is challenging the authority of Interior Secretary Sally Jewell to cancel Solenex's 6,200-acre lease in the Badger Two Medicine area of Montana's Lewis and Clark National Forest. Jewell bowed to Blackfeet Indian Nation concerns on March 17, canceling a proposed oil/natural gas lease sale in the national forest in northwest Montana.

The leaseholds in question are in the national forest and not on Montana's Blackfeet Reservation. The area is the site of the creation story of the four Blackfoot tribes and the Sun Dance, which is considered central to their religion.

Lechner, MSLF vice president and chief attorney, has maintained that Interior can only cancel a lease if the operator, such as Louisiana-based Solenex, violates the terms. He has argued that this decision to cancel them for insufficient review will have a chilling effect on future development of oil/gas on federal lands.

Following years of delay and legal wrangling, Interior said last November it planned to cancel 18 natural gas and oil leases in Montana's Lewis and Clark National Forest (see Daily GPINov. 25, 2015).

Dozens of leases originally were sold during the 1980s to producers in the area, but a federal drilling suspension has been in place nearly as long. Over the years many of leases have been surrendered or retired. Solenex with the MSLF attorneys’ representation challenged this inaction.

Three years ago Solenex challenged the suspension to allow it to drill for natural gas. Under an order from U.S. District Judge Richard Leon, federal officials had to decide by Nov. 23, 2015 to notify the court whether it would lift the drilling suspension or cancel the leases. Devon Energy Corp. still holds most of the other leases, according to federal officials.

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