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Montana, Wyoming Water Fight Trial Begins

A lawsuit involving coalbed methane (CBM) development that dates back more than a decade will get its day in court beginning Wednesday when a federal trial gets underway in Billings, MT to determine if Wyoming should be held liable for alleged water losses in tributaries of the Yellowstone River.

The lawsuit is part of a 2007 U.S. Supreme Court case in which the high court appointed a Special Master affiliated with Stanford University's law school to oversee a case that has traveled a long and winding legal road.

At issue is the Yellowstone River compact, signed in 1950 by Montana, Wyoming and North Dakota officials. Montana alleges that the compact was violated by Wyoming from drilling and agricultural activities, which depleted Yellowstone tributaries, the Tongue and Powder rivers, before the waters flowed north into Montana. Wyoming's CBM and natural gas development has been ongoing in the state for years.

North Dakota is named in the legal action by Montana because it was a signatory to the original compact, but no claims have been lodged against the state, and it has no stake in the outcome, according to the parties.

Although Montana has not quantified water losses, it is claiming to have been denied 10,160 acre-feet of water over the past decade. The total amounts to 3.3 billion gallons of water.

Anadarko Petroleum Corp., which has been one of Wyoming's biggest CBM and natural gas producers, intervened in 2009 and supported Wyoming filings in U.S. District Court for the District of Montana. Anadarko and the state have attempted to exclude water taken for drilling by arguing that there is no clear connection between pumping groundwater and depleting rivers and streams.

For many years Montana has stressed protecting the water quality of the Tongue River headwaters and in 2007 pushed to maintain strict water quality standards for CBM development in the Powder River Basin of Wyoming. The Tongue River travels north into Montana, where it meets the Yellowstone River. Montana was sued by four gas producers in 2006 in an effort to overturn "excessive" requirements on the quality of water exiting CBM development areas in the Powder River Basin (see Daily GPI, Aug. 2, 2006).

Wyoming has tried several times to obtain a summary judgment and avoid a trial with no success, claiming that a more recent 1992 agreement of the parties limits Montana's claims, and that the original Yellowstone Compact does not include CBM groundwater. It also has claimed that any remaining claims by Montana would be "too trivial" for a trial. Thompson did not agree.

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