In an opinion with as many acronyms as the Dallas Cowboys have draft-pick detractors, a California federal court in Center For Biological Diversity v. Bureau of Land Management, held that the BLM violated the National Environmental Policy Act in its assessment of oil and gas leases on federal lands in California. A “FONSI” – a Finding of No Significant Impact – issued by the BLM was unreasonable in not considering hydraulic fracturing techniques when used in combination with horizontal drilling. The BLM’s conclusion was that the leases would have no significant environmental impact. In challenging a BLM evaluation, a plaintiff must merely raise substantial questions, but does not have to show that significant effects will occur.

The court found that it was unreasonable to conclude that certain non-No Surface Operations leases did not need further study before their sale.

The NEPA requires “significant action”, in terms of context and intensity, to be considered in the evaluation. Those terms are sliced and diced, defined and described, codified and, apparently, deified, in Section 1508.27 of the Act in ways that are too detailed to consider here. In summary, as there are in most federal regulations, there are plenty of bases for a court to void a government action it doesn’t agree with. One example, “ … the significance of an action must be analyzed in several contexts such as society as a whole (human, national), the affected region, the affected interests, and the locality.” And it goes on.

The BLM failed to meet its burden because it relied on older studies and did not take into account the new technology that has made fracking prevalent. The court said it would be reasonable to assume that with today’s technology a lessee would utilize fracking technology to explore for oil.

The court said that it was “unreasonable for BLM not to at least consider reasonable projections of drilling in the area that include fracking operations, or else limit its sale to leases with NSO provisions that would permit it to prohibit all surface disturbances until more specific information becomes available.” By failing to consider fracking the BLM failed to properly assess at least three “intensity” factors in its FONSI.

In a well-timed op-ed piece, the Wall Street Journal compared the economies of Texas and California, two of the country’s most resource-rich states. The WSJ compares the success of Texas to the troubles in California by looking at the differences in their approach to fossil fuels and economic develoment in general.

Thanks to Brooke Sizer for her contribution to this entry.