United States District Court, D. Wyoming
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State of Wyoming, Petitioner: Jeremy A Gross, Michael James
McGrady, LEAD ATTORNEYS, WYOMING ATTORNEY GENERAL'S
OFFICE, Cheyenne, WY.
State of Colorado, Petitioner: Andrew J Kuhlmann, WYOMING
ATTORNEY GENERAL'S OFFICE, Cheyenne, WY; Frederick R.
Yarger, PRO HAC VICE, COLORADO ATTORNEY GENERAL'S OFFICE,
Independent Petroleum Association of America, Western Energy
Alliance, Petitioners: Alexander Karl Obrecht, Mark S Barron,
LEAD ATTORNEYS, PRO HAC VICE, Baker & Hostetler, Denver, CO;
Lyle Poe Leggette, LEAD ATTORNEY, BAKER AND HOSTETLER,
State of North Dakota, Intervenor Petitioner: Andrew C
Emrich, LEAD ATTORNEY, HOLLAND & HART, Greenwood Village, CO;
Hope Hogan, Matthew A Sagsveen, Wayne Stenehjem, LEAD
ATTORNEYS, PRO HAC VICE, NORTH DAKOTA ATTORNEY GENERALS
OFFICE, Bismarck, ND; Lauren R Caplan, LEAD ATTORNEY, PRO HAC
VICE, HOLLAND & HART LLP, Washington, DC; Paul M Seby, LEAD
ATTORNEY, PRO HAC VICE, HOLLAND & HART, Denver, CO.
Indian Tribe, Intervenor Petitioner: Christopher J Reagen,
Jeffrey S Rasmussen, Jeremy J Patterson, LEAD ATTORNEYS, PRO
HAC VICE, FREDERICKS PEEBLES & MORGAN LLP, Louisville, CO;
Scott P Klosterman, LEAD ATTORNEY, WILLIAMS PORTER DAY &
NEVILLE, Casper, WY.
Sierra Club, Intervenor Respondent: Michael S Freeman, LEAD
ATTORNEY, PRO HAC VICE, EARTHJUSTICE, Denver, CO; Nathan
Douglas Matthews, LEAD ATTORNEY, PRO HAC VICE, SIERRA CLUB
ENVIRONMENTAL LAW PROGRAM, San Francisco, CA; Nathan Maxon,
LEAD ATTORNEY, MAXON LAW OFFICE, Lander, WY.
Earthworks, Western Resource Advocates, Wilderness Society,
Conservation Colorado Education Fund, Southern Utah
Wilderness Alliance, Intervenor Respondents: Michael S
Freeman, LEAD ATTORNEY, PRO HAC VICE, EARTHJUSTICE, Denver,
CO; Nathan Maxon, LEAD ATTORNEY, MAXON LAW OFFICE, Lander,
United States Department of the Interior Secretary, In her
offical capacity as Secretary of the Interior also known as
Sally Jewell, United States Bureau of Land Management
Director, also known as Neil Kornze, United States Department
of the Interior, United States Bureau of Land Management,
Respondents: David A Carson, LEAD ATTORNEY, PRO HAC VICE,
DEPARTMENT OF JUSTICE, Denver, CO; Jody H Schwarz, LEAD
ATTORNEY, PRO HAC VICE, UNITED STATES DEPARTMENT OF JUSTICE,
Environment and Natural Resources Divisions, Washington, DC;
Nicholas Vassallo, LEAD ATTORNEY, U.S. ATTORNEY'S OFFICE,
Cheyenne, WY; Stephen R Terrell, LEAD ATTORNEY, PRO HAC VICE,
U.S. DEPARTMENT OF JUSTICE, ENVIRONMENTAL AND NATURAL
RESOURCES DIVISION, Washington, DC; William E Gerard, LEAD
ATTORNEY, PRO HAC VICE, U.S. DEPARTMENT OF JUSTICE,
ENVIRONMENT & NATURAL RESOURCES DIVISION WILDLIFE & MARINE
RESOURCES, Washington, DC.
Wyoming County Commissioners Association, Amicus: Gregory M
Cowan, LEAD ATTORNEY, Wyoming County Commissioners
Association, Cheyenne, WY.
State of Utah, Intervenor: Daniel B Frank, LEAD ATTORNEY,
FRANK LAW OFFICE, Cheyenne, WY; John Robinson, Jr, Sean D
Reyes, Steven F Alder, LEAD ATTORNEYS, PRO HAC VICE, UTAH
ATTORNEY GENERAL'S OFFICE, Salt Lake City, UT.
Independent Petroleum Association of America, Western Energy
Alliance, Petitioners (2:15-cv-00041-SWS): Lyle Poe Leggette,
LEAD ATTORNEY, BAKER AND HOSTETLER, Denver, CO; Alexander
Karl Obrecht, Mark S Barron, PRO HAC VICE, Baker & Hostetler,
Wyoming County Commissioners Association, Movant
(2:15-cv-00041-SWS): Gregory M Cowan, LEAD ATTORNEY, Wyoming
County Commissioners Association, Cheyenne, WY.
Sierra Club, Intervenor Respondent (2:15-cv-00041-SWS):
Michael S Freeman, LEAD ATTORNEY, PRO HAC VICE, EARTHJUSTICE,
Denver, CO; Nathan Douglas Matthews, LEAD ATTORNEY, PRO HAC
VICE, SIERRA CLUB ENVIRONMENTAL LAW PROGRAM, San Francisco,
CA; Nathan Maxon, LEAD ATTORNEY, MAXON LAW OFFICE, Lander,
Earthworks, Western Resource Advocates, Conservation Colorado
Education Fund, Wilderness Society, Southern Utah Wilderness
Alliance, Intervenor Respondents (2:15-cv-00041-SWS): Michael
S Freeman, LEAD ATTORNEY, PRO HAC VICE, EARTHJUSTICE, Denver,
CO; Nathan Maxon, LEAD ATTORNEY, MAXON LAW OFFICE, Lander,
Bureau of Land Management, Secretary of the U.S. Department
of the Interior, in her official capacity also known as Sally
Jewell, Respondents (2:15-cv-00041-SWS): David A Carson, LEAD
ATTORNEY, DEPARTMENT OF JUSTICE, Denver, CO; Nicholas
Vassallo, LEAD ATTORNEY, U.S. ATTORNEY'S OFFICE,
Cheyenne, WY; William E Gerard, LEAD ATTORNEY, PRO HAC VICE,
U.S. DEPARTMENT OF JUSTICE, ENVIRONMENT & NATURAL RESOURCES
DIVISION, WILDLIFE & MARINE RESOURCES, Washington, DC.
ON MOTIONS FOR PRELIMINARY INJUNCTION
W. Skavdahl, United States District Judge.
matter comes before the Court on the motions for preliminary
injunction filed by the various Petitioners and
Intervenor-Petitioners: Motion for Preliminary
Injunction of Petitioners Independent Petroleum
Association of America (" IPAA" ) and Western
Energy Alliance (" Alliance" ) (hereinafter "
Industry Petitioners" ) (ECF No. 11 in 15-CV-041);
Wyoming and Colorado's Motion for Preliminary
Injunction (ECF No. 32), in which the State of
Utah has joined; North Dakota's Motion for
Preliminary Injunction (ECF No. 52), in which the State
of Utah has joined; and Motion for Preliminary
Injunction filed by the Ute Indian Tribe (ECF No. 89).
The Court, having considered the briefs and materials
submitted in support of the motions and the oppositions
thereto, including the Administrative Record, having heard
witness testimony and oral argument of counsel, and being
otherwise fully advised, FINDS and ORDERS as follows:
March 26, 2015, the Bureau of Land Management ("
BLM" ) issued the final version of its regulations
applying to hydraulic fracturing on federal and Indian lands.
80 Fed.Reg. 16,128-16,222 (Mar. 26, 2015) ('Tracking
Rule" ). The Fracking Rule's focus is on three
aspects of oil and gas development -- wellbore construction,
chemical disclosures, and water management ( id. at
16,128 & 16,129) -- each of which is subject to comprehensive
regulations under existing federal and state law. The rule
was scheduled to take effect on June 24, 2015. Following a
hearing on the preliminary injunction motions, this Court
postponed the effective date of the Fracking Rule pending the
BLM's lodging of the Administrative Record ("
A.R." ) and the Court's ultimate ruling on the
preliminary injunction motions. ( See ECF No. 97.)
better part of the last decade, oil and natural gas
production from domestic wells has increased steadily. Most
of this increased production has come through the application
of the well stimulation technique known as hydraulic
fracturing (or " Tracking" ) -- the procedure by
which oil and gas producers inject water, sand, and certain
chemicals into tight-rock formations (typically shale) to
create fissures in the rock and allow oil and gas to escape
for collection in a well. See 80 Fed.Reg. at 16,131
(estimating that ninety percent of new wells drilled on
federal lands in 2013 were stimulated using hydraulic
fracturing techniques). Hydraulic fracturing has been used to
stimulate wells in the United States for at least 60 years --
traditionally in conventional limestone and sandstone
reservoirs -- and meaningful attempts to use the technique to
extract hydrocarbons from shale date back to at least the
1970s. See U.S. Dep't of Energy, How is
Shale Gas Produced?  " More recently, hydraulic
fracturing has been coupled with relatively new horizontal
drilling technology in larger-scale operations that have
allowed greatly increased access to shale oil and gas
resources across the country, sometimes in areas that have
not previously or recently experienced significant oil and
gas development." 80 Fed.Reg. 16,128.
in response to " public concern about whether fracturing
can lead to or cause the contamination of underground water
sources," and " increased calls for stronger
regulation and safety protocols," the BLM undertook
rulemaking to implement " additional regulatory effort
and oversight" of this practice. Id. at 16,128
& 16,131. In May of 2012, the BLM issued proposed rules
" to regulate hydraulic fracturing on public land and
Indian land." 77 Fed.Reg. 27,691 (May 11, 2012). The
stated focus of the rules was to: (i) provide disclosure to
the public of chemicals used in hydraulic fracturing; (ii)
strengthen regulations related to well-bore integrity; and
(iii) address issues related to water produced during oil and
gas operations. Id. The BLM reports it received
approximately 177,000 public comments on the initial proposed
rules " from individuals, Federal and state governments
and agencies, interest groups, and industry
representatives." 80 Fed.Reg. at 16,131.
over a year later, the BLM issued revised proposed rules,
representing that the agency has " used the comments on
[the May 11, 2012 draft proposed rules] to make
improvements" to the agency's proposal. 78 Fed.Reg.
31,636 (May 24, 2013). Key changes included an expanded set
of cement evaluation tools to help ensure protection and
isolation of usable water zones and a revised process for how
operators could report information about chemicals they claim
to be protected as trade secrets. Id. at 31,636 &
31,637. The BLM also expressed its intent to " work with
States and tribes to establish formal agreements that will
leverage the strengths of partnerships, and reduce
duplication of efforts for agencies and operators,
particularly in implementing the revised proposed rule as
consistently as possible with State or tribal
regulations." Id. at 31,637. The BLM reportedly
received over 1.35 million comments on the supplemental
proposed rule. 80 Fed.Reg. at 16,131.
ultimately published its final rule regulating hydraulic
fracturing on federal and Indian lands on March 26, 2015. The
BLM determined the Fracking Rule fulfills the goals of the
initial proposed rules: " [t]o ensure that wells are
properly constructed to protect water supplies, to make
certain that the fluids that flow back to the surface as a
result of hydraulic fracturing operations are managed in an
environmentally responsible way, and to provide public
disclosure of the chemicals used in hydraulic fracturing
fluids." Id. at 16,128.
Industry Petitioners and the States of Wyoming and Colorado
filed separate Petitions for Review of Final Agency
Action on March 20th and 26th, 2015, respectively,
seeking judicial review of the Fracking Rule pursuant to the
Administrative Procedure Act (" APA" ), 5 U.S.C.
§ 701 et seq. The States of North Dakota and Utah, and
the Ute Indian Tribe of the Uintah and Ouray Reservation,
later intervened in the States' action, and the Court
granted the parties' motion to consolidate the two
separate actions. Petitioners and Intervenor-Petitioners
request a preliminary injunction enjoining the BLM from
applying the Fracking Rule pending the resolution of this
obtain a preliminary injunction, petitioners must show:
" (1) a likelihood of success on the merits; (2) that
they will [likely] suffer irreparable harm; (3) that the
balance of equities tips in their favor; and (4) that the
injunction is in the public interest." Petrella v.
Brownback, 787 F.3d 1242, 1257 (10th Cir. 2015). See
also Glossip v. Gross, 135 S.Ct. 2726, 2736,
192 L.Ed.2d 761 (2015) (quoting Winter v. Natural Res.
Def. Council, Inc., 555 U.S. 7, 20, 129 S.Ct. 365, 172
L.Ed.2d 249 (2008)). " [B]ecause a preliminary
injunction is an extraordinary remedy, the movant's right
to relief must be clear and unequivocal."
Fundamentalist Church of Jesus Christ of Latter-Day
Saints v. Home, 698 F.3d 1295, 1301 (10th Cir. 2012)
(internal quotation marks and citation omitted).
The purpose of a preliminary injunction is merely to preserve
the relative positions of the parties until a trial on the
merits can be held. Given this limited purpose, and given the
haste that is often necessary if those positions are to be
preserved, a preliminary injunction is customarily granted on
the basis of procedures that are less formal and evidence
that is less complete than in a trial on the merits. A party
thus is not required to prove his case in full at a
preliminary-injunction hearing, and the findings of fact and
conclusions of law made by a court granting a preliminary
injunction are not binding at trial on the merits.
Univ. of Texas v. Camenisch, 451 U.S. 390, 395, 101
S.Ct. 1830, 68 L.Ed.2d 175 (1981) (citations omitted).
See also Attorney General of Okla. v. Tyson
Foods, Inc., 565 F.3d 769, 776 (10th Cir. 2009);
RoDa Drilling Co. v. Siegal, 552 F.3d 1203, 1208
(10th Cir. 2009) (primary goal of preliminary injunction is
to preserve the pre-trial status quo). The grant or denial of
a preliminary injunction lies within the sound discretion of
the district court. Amoco Oil Co. v. Rainbow Snow,
748 F.2d 556, 557 (10th Cir. 1984).
contend the Fracking Rule should be set aside because it is
arbitrary, not in accordance with law, and in excess of the
BLM's statutory jurisdiction and authority. See
5 U.S.C. § 706(2)(A) & (C). The Ute Indian Tribe
additionally contends the Fracking Rule is contrary to the
Federal trust obligation to Indian tribes.
Likelihood of Success on the Merits
review of agency action is governed by the standards set
forth in § 706 of the APA, requiring the reviewing court
to engage in a " substantial inquiry."
Olenhouse v. Commodity Credit Corp., 42 F.3d 1560,
1573-74 (10th Cir. 1994) (citing Citizens to Preserve
Overton Park v. Volpe, 401 U.S. 402, 91 S.Ct. 814, 28
L.Ed.2d 136 (1971)). While an agency's decision is
entitled to a " presumption of regularity," the
presumption does not shield the agency from a "
thorough, probing, in-depth review." Id. at
1574. " [T]he essential function of judicial review is a
determination of (1) whether the agency acted within the
scope of its authority, (2) whether the agency complied with
prescribed procedures, and (3) whether the action is
otherwise arbitrary, capricious or an abuse of
discretion." Id. " Determination of
whether the agency acted within the scope of its authority
requires a delineation of the scope of the agency's
authority and discretion, and consideration of whether on the
facts, the agency's action can reasonably be said to be
within that range." Id.
the arbitrary and capricious standard, a court must ascertain
" whether the agency examined the relevant data and
articulated a rational connection between the facts found and
the decision made." Id. The agency must provide
a reasoned basis for its action and the action must be
supported by the facts in the record. Id. at 1575.
Agency action is arbitrary if not supported by "
substantial evidence" in the administrative record.
Olenhouse, 42 F.3d at 1575; Pennaco Energy, Inc.
v. U.S. Dep't of Interior, 377 F.3d 1147, 1156 (10th
Cir. 2004). " Substantial evidence is such relevant
evidence as a reasonable mind might accept as adequate
to support a conclusion." Pennaco Energy, 377
F.3d at 1156 (quoting Doyal v. Barnhart, 331 F.3d
758, 760 (10th Cir. 2003)). " Because the arbitrary and
capricious standard focuses on the rationality of an
agency's decisionmaking process rather than on the
rationality of the actual decision, '[i]t is
well-established that an agency's action must be upheld,
if at all, on the basis articulated by the agency
itself.'" Olenhouse, 42 F.3d at 1575
(quoting Motor Vehicle Mfrs. Ass'n v. State Farm Mut.
Ins. Co., 463 U.S. 29, 50, 103 S.Ct. 2856, 77 L.Ed.2d
443 (1983)). Courts will not accept post-hoc rationalizations
for agency action. Biodiversity Conservation Alliance v.
Jiron, 762 F.3d 1036, 1060 (10th Cir. 2014). " The
agency itself must supply the evidence of that reasoned
decisionmaking in the statement of basis and purpose mandated
by the APA." Int 7 Bhd. of Teamsters,
Chauffeurs, Warehousemen & Helpers of Am. v. United
States, 735 F.2d 1525, 1531, 237 U.S.App.D.C. 89 (D.C.
Cir. 1984). See also Wyo. Outdoor Council v.
U.S. Forest Serv., 165 F.3d 43, 53, 334 U.S.App.D.C. 98
(D.C. Cir. 1999) (rule's preamble serves as a source of
evidence concerning contemporaneous agency intent).
Whether BLM Has Authority to Regulate Hydraulic
It is axiomatic that an administrative agency's power to
promulgate legislative regulations is limited to the
authority delegated by Congress." Bowen v.
Georgetown Univ. Hosp., 488 U.S. 204, 208, 109 S.Ct.
468, 102 L.Ed.2d 493 (1988). " Regardless of how serious
the problem an administrative agency seeks to address,  it
may not exercise its authority 'in a manner that is
inconsistent with the administrative structure that Congress
enacted into law." ' Food and Drug Admin, v.
Brown & Williamson Tobacco Corp., 529 U.S. 120, 125, 120
S.Ct. 1291, 146 L.Ed.2d 121 (2000) (quoting ETSI Pipeline
Project v. Missouri, 484 U.S. 495, 517, 108 S.Ct. 805,
98 L.Ed.2d 898 (1988)). Accordingly, an " essential
function" of a court's review under the APA is to
determine " whether an agency acted within the scope of
its authority." WildEarth Guardians v. U.S. Fish and
Wildlife Serv., 784 F.3d 677, 683 (10th Cir. 2015).
case involves an administrative agency's assertion of
authority to regulate a particular activity pursuant to a
statute that it administers, the court's analysis is
governed by Chevron U.S.A. Inc. v. Natural Res. Def.
Council, Inc., 467 U.S. 837, 104 S.Ct. 2778, 81 L.Ed.2d
694 (1984). See Brown & Williamson, 529
U.S. at 132.
Under Chevron, a reviewing court must first ask
whether Congress has directly spoken to the precise question
at issue. If Congress has done so, the inquiry is at an end;
the court must give effect to the unambiguously expressed
intent of Congress. But if Congress has not specifically
addressed the question, a reviewing court must respect the
agency's construction of the statute so long as it is
permissible. Such deference is justified because the
responsibilities for assessing the wisdom of such policy
choices and resolving the struggle between competing views of
the public interest are not judicial ones, and because of the
agency's greater familiarity with the ever-changing facts
and circumstances surrounding the subjects regulated[.]
Id. (internal quotation marks and citations
omitted). This Court must first determine, then, whether
Congress has directly addressed the issue of BLM's
authority to regulate hydraulic fracturing.
Supreme Court has provided the following guidance for
determining whether Congress has specifically addressed the
question at issue:
In determining whether Congress has specifically addressed
question at issue, a reviewing court should not confine
itself to examining a particular statutory provision in
isolation. The meaning--or ambiguity--of certain words or
phrases may only become evident when placed in context.
See Brown v. Gardner, 513 U.S. 115, 118,
115 S.Ct. 552, 130 L.Ed.2d 462 (1994) (" Ambiguity is a
creature not of definitional possibilities but of statutory
context" ). It is a " fundamental canon of
statutory construction that the words of a statute must be
read in their context and with a view to their place in the
overall statutory scheme." Davis v. Michigan Dept.
of Treasury, 489 U.S. 803, 809, 109 S.Ct. 1500, 103
L.Ed.2d 891 (1989). A court must therefore interpret the
statute " as a symmetrical and coherent regulatory
scheme," Gustafson v. Alloyd Co., 513 U.S. 561,
569, 115 S.Ct. 1061, 131 L.Ed.2d 1 (1995), and " fit, if
possible, all parts into an harmonious whole," FTC
v. Mandel Brothers, Inc., 359 U.S. 385, 389, 79 S.Ct.
818, 3 L.Ed.2d 893 (1959). Similarly, the meaning of one
statute may be affected by other Acts, particularly where
Congress has spoken subsequently and more specifically to the
topic at hand. See United States v. Estate of
Romani, 523 U.S. 517, 530-531, 118 S.Ct. 1478, 140
L.Ed.2d 710 (1998); United States v. Fausto, 484
U.S. 439, 453, 108 S.Ct. 668, 98 L.Ed.2d 830 (1988). In
addition, we must be guided to a degree by common sense as to
the manner in which Congress is likely to delegate a policy
decision of such economic and political magnitude to an
administrative agency. Cf. MCI Telecommunications Corp.
v. American Telephone & Telegraph Co., 512 U.S. 218,
231, 114 S.Ct. 2223, 129 L.Ed.2d 182 (1994).
Id. at 132-33. Guided by the foregoing principles,
the Court finds that Congress has directly spoken to the
issue and precluded federal agency authority to regulate
hydraulic fracturing not involving the use of diesel fuels.
having previously disavowed authority to regulate hydraulic
fracturing, the BLM now asserts authority to
promulgate the Fracking Rule under various statutes: the
Federal Land Policy and Management Act of 1976 ("
FLPMA" ), 43 U.S.C. § § 1701-1787; the
Mineral Leasing Act of 1920 (" MLA" ), 30 U.S.C.
§ § 181-287; the 1930 Right-of-Way Leasing Act,
id. § § 301-306; the Mineral Leasing Act
for Acquired Lands, id. § § 351-360; the
Federal Oil and Gas Royalty Management Act of 1982,
id. § § 1701-1759; the Indian Mineral
Leasing Act of 1938 (" IMLA" ), 25 U.S.C. §
§ 396a-396g; and the Indian Mineral Development Act of
1982 (" IMDA" ), id. § §
2101-2108. 80 Fed.Reg. at 16,217. The State Petitioners and
Ute Indian Tribe argue none of these statutes authorize the
BLM to regulate hydraulic fracturing activities.
creates a program for leasing mineral deposits on federal
lands. Congress authorized the Secretary
" to prescribe necessary and proper rules and
regulations and to do any and all things
necessary to carry out and accomplish the purposes
of the [the MLA]." 30 U.S.C. § 189 (emphasis
added). " The purpose of the Act is to promote the
orderly development of oil and gas deposits in publicly owned
lands of the United States through private enterprise."
Geosearch, Inc. v. Andrus, 508 F.Supp. 839, 842 (D.
Wyo. 1981) (citing Harvey v. Udall, 384 F.2d 883
(10th Cir. 1967)). See also Arkla Exploration
Co. v. Texas Oil & Gas Corp., 734 F.2d 347, 358 (8th
Cir. 1984) (" broad purpose of the MLA was to provide
incentives to explore new, unproven oil and gas areas through
noncompetitive leasing, while assuring through competitive
bidding adequate compensation to the government for leasing
in producing areas" ). Specifically for oil and gas
leasing, the MLA, inter alia, establishes terms of
the lease and royalty and rental amounts (30 U.S.C. §
§ 223, 226(d)& (e)), requires the lessee to " use
all reasonable precautions to prevent waste of oil or gas
developed in the land" ( id. § 225),
authorizes the Secretary of Interior to lease all public
lands subject to the Act for oil and gas development (
id. § 226(a)), directs the Secretary to
regulate surface -disturbing activities (
id. § 226(g)), and allows for the establishment
of cooperative development plans to conserve oil and gas
resources ( id. § 226(m)).
Right-of Way Leasing Act, Congress expanded the
Secretary's leasing authority to allow leasing of
federally owned minerals beneath railroads and other rights
of way. 30 U.S.C. § 301. Like the MLA, the Right-of-Way
Leasing Act grants the Secretary general rulemaking authority
to carry out the Act. Id. § 306. The Mineral
Leasing Act for Acquired Lands again extended the provisions
of the MLA, including the Secretary's leasing authority,
to apply to minerals beneath lands coming into federal
ownership and not already subject to the MLA. 30 U.S.C.
§ § 351-52. Although, like the MLA, the Act grants
the Secretary rulemaking authority to carry out the purposes
of the Act, id. § 359, the Act simply expanded
the BLM's authority to issue and manage leases for the
development of specified minerals, including oil and gas.
See Watt v. Alaska, 451 U.S. 259, 269, 101
S.Ct. 1673, 68 L.Ed.2d 80 (1981). The Fracking Rule's
authority section also cites the general rulemaking authority
granted by the Federal Oil and Gas Royalty Management Act of
1982 (" FOGRMA" ). 30 U.S.C. § 1751. FOGRMA,
however, simply creates a thorough system for collecting and
accounting for federal mineral royalties. See
Shell Oil Co. v. Babbitt, 125 F.3d 172, 174 (3rd
Cir. 1997). The general rulemaking authority granted by these
ancillary mineral leasing statutes, which is cabined by the
purposes of the Acts, cannot be interpreted as authority for
comprehensive regulation of hydraulic fracturing.
Secretary also invokes the statutory authority granted to the
BLM by the Indian Mineral Leasing Act and the Indian Mineral
Development Act as a basis for the Fracking
Rule. These statutes, generally, grant the
Secretary broad regulatory jurisdiction over oil and gas
development and operations on Indian lands. 25 U.S.C. §
§ 396d, 2107. However, neither the IMLA nor the IMDA
delegates any more specific authority over oil and gas
drilling operations than the MLA, nor has BLM promulgated
separate regulations for
operations on Indian lands. Rather, existing Bureau of Indian
Affairs (" BIA" ) regulations incorporate 43 C.F.R.
Part 3160 (Onshore Oil and Gas Operations -- General) and
require BLM to oversee implementation of those regulations.
25 C.F.R. § § 211.4, 225.4. The Fracking Rule
amends and revises the Part 3160 regulations. See 80
Fed.Reg. at 16, 217.
claims the Fracking Rule simply supplements existing
requirements for oil and gas operations set out in 43 C.F.R.
3162.3-1 and Onshore Oil and Gas Orders 1, 2 and 7. 80
Fed.Reg. at 16,129. BLM asserts its decades-old "
cradle-to-grave" regulations governing oil and gas
operations, promulgated pursuant to its MLA § 189
authority, already include regulation of hydraulic
fracturing, albeit minimally " because the practice was
not extensive (or similar to present-day design) when the
regulations were promulgated." ( Resp't Br. in
Opp'n to Wyoming and Colorado's Mot. for Prelim.
Inj. at 11) (ECF No. 68). Historically, however,
BLM's only regulation addressing hydraulic fracturing
worked to prevent any additional surface disturbance and
impose reporting requirements and did not regulate the
fracturing process itself. See 43 C.F.R.
§ 3162.3-2(b) (" Unless additional surface
disturbance is involved . . . prior approval is not required
for routine fracturing or acidizing jobs . . . ; however, a
subsequent report on these operations must be filed . . .
." ). This requirement makes sense because the MLA
expressly authorizes regulation of " all
surface -disturbing activities . . . in the interest
of conservation of surface resources." 30
U.S.C. § 226(g) (emphasis added). The BLM cites to no
other existing regulation addressing hydraulic fracturing.
Neither does the BLM cite any specific provision of the
mineral leasing statutes authorizing regulation of this
underground activity or regulation for the purpose of
guarding against any incidental, underground environmental
effects. Indeed, the BLM has previously taken the position,
up until formulation of the Fracking Rule, that it lacked the
authority or jurisdiction to regulate hydraulic fracturing.
See Center for Biological Diversity v. BLM,
937 F.Supp.2d 1140, 1156 (N.D. Cal. 2013).
When an agency claims to discover in a long-extant statute an
unheralded power to regulate " a significant portion of
the American economy," [the Court] typically greet[s]
its announcement with a measure of skepticism. [The Court]
expect[s] Congress to speak clearly if it wishes to assign to
an agency ...