Park County Resource Council v. US DEPT. OF AGR.

• Decision Date: 25 July 1985
• Docket Number: No. C85-0208-B.,C85-0208-B.
• Citation: 613 F. Supp. 1182
• Parties: PARK COUNTY RESOURCE COUNCIL, INC., a non-profit corporation; Stan Siggins, an individual; Lloyd Zeman, an individual, Plaintiffs, v. UNITED STATES DEPARTMENT OF AGRICULTURE, United States Forest Service; Stephen P. Mealey, in his official capacity as supervisor of the Shoshone National Forest; Bureau of Land Management; Department of the Interior of the United States; Hilery Oden, in his official capacity as State Director of the Bureau of Land Management, Defendants, and Marathon Oil Company, Amerada Hess Corporation, and Rosewood Resources, Inc., Defendants-Intervenors.
• Court: U.S. District Court — District of Wyoming

613 F. Supp. 1182

PARK COUNTY RESOURCE COUNCIL, INC., a non-profit corporation; Stan Siggins, an individual; Lloyd Zeman, an individual, Plaintiffs, v. UNITED STATES DEPARTMENT OF AGRICULTURE, United States Forest Service; Stephen P. Mealey, in his official capacity as supervisor of the Shoshone National Forest; Bureau of Land Management; Department of the Interior of the United States; Hilery Oden, in his official capacity as State Director of the Bureau of Land Management, Defendants and Marathon Oil Company, Amerada Hess Corporation, and Rosewood Resources, Inc., Defendants-Intervenors.

No. C85-0208-B.

United States District Court, D. Wyoming.

July 25, 1985.

COPYRIGHT MATERIAL OMITTED

Patrick J. Marley, (pro hac vice), Cole & Marley, Los Angeles, Cal., Don W. Riske, Cheyenne, Wyo., for plaintiffs.

Richard A. Stacy, U.S. Atty., and Carole A. Statkus, Asst. U.S. Atty., Cheyenne, Wyo., Marla Mansfield, Regional Sol., U.S. Dept. of Interior, Denver, Colo., for Federal defendants.

Stanley K. Hathaway, Hathaway, Speight & Kunz, Cheyenne, Wyo., and Charles L. Kaiser (pro hac vice), Davis, Graham & Stubbs, Denver, Colo., for defendants-intervenors.

MEMORANDUM OPINION

BRIMMER, Chief Judge.

This case arises from plaintiffs' contention that the Bureau of Land Management issued an oil and gas lease, and later granted an Application for Permit to Drill (APD), in violation of the National Environmental Policy Act (NEPA), 42 U.S.C. § 4321, et seq. By the July 1, 1985 Order of this Court, plaintiffs' motion for a Temporary Restraining Order on the granting of the APD was denied. To allow plaintiffs an opportunity to address the issues more fully, the Court then held a hearing on plaintiffs' motion for preliminary injunction, which with the agreement of counsel, the Court consolidated into a full hearing on the merits. Fed.R.Civ.P. 65(a)(2). At the conclusion of the evidence and final arguments, the Court concluded that plaintiffs failed to carry their burden of proof both for the preliminary injunction and upon the merits of the case, and orally denied plaintiffs' motion and dismissed their claims with prejudice. This memorandum opinion confirms the oral Order and more fully sets out the reasoning of the Court.

On July 9, 1982 the Bureau of Land Management (BLM) decided to issue Federal Oil and Gas Lease W-73230 to defendant-intervenors, which lease encompasses multiple-use lands in the Shoshone National Forest. The lease contains a number of stipulations and surface use restrictions which, together with applicable Department of the Interior regulations, required the conduct of additional environmental studies and approval by the United States before any exploration or development activities could be conducted on the lease. Neither plaintiffs nor any other party challenged the BLM's proposed issuance of this lease, nor appealed the BLM decision to the Interior Board of Land Appeals (IBLA).

On June 21, 1983 intervenor Marathon Oil Company, the designated operator for the lease, submitted an Application for Permit to Drill (APD). Federal defendants prepared a draft Environmental Impact Statement (EIS) on the APD in February, 1984, and completed a second draft in October 1984 and a Final EIS in March 1985. They held public meetings to discuss these documents on September 27, 1983, October 19, 1983, March 21, 1984, April 21, 1984, May 1, 1984, May 2, 1984, and November 8, 1984. At the conclusion of this process the BLM granted intervenors a limited right to drill an exploratory oil and gas well at North Fork on an untimbered ridge located 28 miles west of Cody, Wyoming, and 26 miles east of Yellowstone National Park, access to which was to be obtained only by helicopter transport from a staging area situated on an abandoned quarry site near U.S. Highways 14, 16 and 20 about a mile or two from the drill site.

Plaintiffs appealed this decision to the IBLA, which decision is still pending. However, when the IBLA denied plaintiffs' motion to stay the drilling pending outcome of the appeal, plaintiffs filed suit in this Court. Plaintiffs contend that the actions of the BLM and the Forest Service violated NEPA and the Endangered Species Act, 16 U.S.C. § 1531, et seq. Specifically, plaintiffs contend:

(1) That an EIS, rather than an Environmental Assessment, should have been prepared for the entire lease area,

(2) that the EIS on the APD itself is inadequate, and,

(3) that the Endangered Species Act was violated.

The Court has studied each of these issues, and concludes that plaintiffs have failed to prove their claims. Plaintiffs failed to establish irreparable harm either to themselves or the environment. Plaintiffs' witnesses testified to some unspecified fears about inability to take hunters or sportsmen into the North Fork area, and possible problems with air and water quality. Nothing testified to by these witnesses convinced the Court that the Environmental Assessment and EIS were erroneous in concluding that there will be no irreparable harm to the environment or plaintiffs. Without such a showing, a preliminary injunction would be improper. Lundgrin v. Claytor, 619 F.2d 61 (10th Cir.1980).

Moreover, the proof clearly showed that if intervenors cannot drill quickly, they will suffer substantial losses. Intervenors have demonstrated that they have made a substantial investment of over $1,000,000 preliminary to drilling the test well. They have also shown that unless they commit to contracting for the only known drilling rig in North America that can be disassembled to permit helicopter access, they will be precluded from conducting approved activities during the 1985 Field Season. Delays in completing these approved activities could result in losses exceeding $500,000. Also, the evidence showed that the public interest favors development of energy resources on federal lands after thorough studies have been completed and when carefully supervised restrictions are placed upon those activities. In light of this evidence the Court concluded that plaintiffs failed in their proof on both the balance of harm and public interest, which is a prerequisite for a preliminary injunction. Lundgrin, 619 F.2d at 63.

Finally, as the Court's decision on the merits will show, the Court concluded that plaintiffs had no substantial likelihood of prevailing on the merits, and therefore the motion for preliminary injunction was denied.

Plaintiffs' first claim is that an EIS, rather than an Environmental Assessment, should have been prepared on the entire lease. Defendants contend that this claim is barred by the 90-day statute of limitations contained in the Mineral Lands Leasing Act. The Court agrees. The statute, which is contained in 30 U.S.C. § 226-2, reads as follows:

No action contesting a decision of the Secretary involving any oil and gas lease shall be maintained unless such action is commenced or taken within 90 days after the final decision of the Secretary relating to such matter.

There is no question that the July 9, 1982 BLM decision on Federal Oil and Gas Lease W-73230 was a decision of the Secretary, and since no party appealed within 30 days pursuant to 43 CFR §§ 4.410 and 4.411, the decision was final, at the latest, on August 8, 1982. There is also no question the plaintiffs knew of the lease decision for a long time prior to their filing date in this case of June 3, 1985. Plaintiffs became aware not later than fall of 1983 that the lease had been issued without preparation of an environmental impact statement. Notwithstanding that knowledge, neither plaintiffs nor any other party challenged issuance of the lease in administrative or judicial proceedings until May 31, 1985, when the IBLA received plaintiffs' Formal Notice of Appeal on the APD.

Even giving plaintiffs the benefit of the doubt that they were unaware of the lease in 1982 or 1983, plaintiffs' own evidence shows that the Park County Resource Council, the plaintiff Stan Siggins and their counsel, Patrick Marley, had complained to the BLM about the legality of the lease in the initial comment period, and as of December 1, 1984 were still objecting that the EIS only covered the North Fork Well, and not the entire lease. See Plaintiffs' Proposed Exhibit # 8.

Either May 31 or June 3, 1985 are well over 90 days from December 1, 1984. The question of whether or not an EIS was needed for the original leasing decision is therefore time-barred by 30 U.S.C. § 226-2. The purpose of this 90-day period is to establish a statute of limitations and to provide stability and remove clouds from titles to federal oil and gas leases. S.Rep. No. 1549, 86th Cong., 2d Sess. 4, reprinted in 1960 U.S.Code Cong. & Ad.News 3313, 3317; Conf.Rep. No. 2135, 86th Cong.2d Sess. 3, reprinted in 1960 U.S.Code Cong. & Ad.News 3337. Plaintiffs would have this Court rule that § 226-2 does not apply in NEPA cases, but they provide no case law to support their position. There is no exception in § 226-2 itself. The statute is clear and unambiguous that no action contesting an oil and gas lease decision shall be maintained unless taken within 90 days. It is the duty of this Court to apply the law as set down by Congress. In the absence of any ambiguity, the Court concludes that on its face § 226-2 applies to plaintiffs' claim.

This Court has stated in a prior decision, "predictability and certainty of title are mandatory to the entire oil and gas leasing system.... Title to thousands of oil and gas leases could be clouded by protest proceedings. Such confusion would be contrary to the expressed statutory intent of the Minerals Leasing Act." Geosearch, Inc. v. Andrus, 508 F.Supp. 839, 845 (D.Wyo.1981). Although referring to an oil and gas lease lottery challenge, NEPA challenges could be just as devastating to the necessity for clear title. Without a statute of limitations to provide some certainty in this area, the express Congressional intent to allow oil and gas leasing in...