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Opening Arguments in BLM Frack Rule Appeal Delayed Until March

The Obama administration will not have an opportunity to defend an embattled rule governing hydraulic fracturing (fracking) on public and tribal lands, after an appellate court postponed oral arguments in the case until March.

Attorneys representing the Department of Interior (DOI) and its Bureau of Land Management (BLM) were originally scheduled to defend the fracking rule at the Tenth Circuit Court of Appeals in Denver on Jan. 17, three days before the inauguration of President-elect Donald Trump.

Last week, the court granted a request made in December by appellees in the case for more time to make their arguments. But in an unusual twist, the court also delayed the proceedings until March 22. The appellees include Colorado, North Dakota, Utah and Wyoming; the Ute Indian Tribe of the Uintah and Ouray Reservation; and the Independent Petroleum Association of America (IPAA) and the Western Energy Alliance (WEA).

According to court records, one hour of argument time has been scheduled, with each side receiving 30 minutes. For the appellees, the aforementioned states, IPAA and WEA will have a combined 24 minutes to make their arguments, while the Ute Indian Tribe will be allotted the remaining six minutes.

Mark Barron, an attorney with law firm Baker & Hostetler LLP representing IPAA and WEA, told NGI's Shale Daily that the decision to delay opening arguments was made by the court on its own volition.

"We were prepared to argue [next] Tuesday," Barron said Thursday, adding that each side traditionally gets 15 minutes to argue their case. He opined that the court granted 30 minutes "because of the number of parties involved, the importance of the issues, and the like."

BLM first unveiled the rule in March 2015. The rule would require oil and gas operators to use the FracFocus registry to disclose the chemicals used in fracking and use above-ground tanks to temporarily store produced water, among other things. But U.S. District Court Judge Scott Skavdahl ruled in June 2016 that the BLM does not have the authority to regulate fracking. The government subsequently filed an appeal.

It remains unclear how the incoming Trump administration will handle the case. Its options include continuing to defend the rule in court, dropping the appeal or withdrawing the rule entirely.

"The new administration could simply drop the appeal, or they could modify the arguments that have already been submitted," Barron said. "They could show up in March and say something different or slightly more nuanced than what is in their briefing. They could voluntarily initiate an administrative remand, where they say they would reconsider the rule. Or they could initiate a rulemaking to just withdraw it entirely."

Although Barron declined to speculate on which option was more likely, he did say it was possible for the Trump administration to continue its campaign message of being friendly to the fossil fuel industry by stating that it doesn't like the rule.

"But there are very few executive branches that come in and say that they are OK with divesting themselves of the authority to do something, if they change their minds down the road," Barron said. "I do think it's a fair observation that even if the Trump administration hates the rule, that it may also dislike the district court's result in this particular lawsuit.

"On the other hand, if Trump really [favors] small government and is anti-regulation, if that philosophy is actually rampant and dominant in their thinking, then maybe they would say 'We don't have jurisdiction. Congress spoke, so let's get the executive branch out of this.'"

Officially, the legal dispute involves two companion cases: State of Wyoming et al v. Jewell et al [No. 16-8068] and State of Wyoming et al v. DOI [No. 16-8069].

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