Ass'n of Irritated Residents v. Cal. Dep't of Conservation

• Decision Date: 08 April 2020
• Docket Number: F078460
• Court: California Court of Appeals Court of Appeals
• Parties: ASSOCIATION OF IRRITATED RESIDENTS et al., Plaintiffs and Appellants, v. CALIFORNIA DEPARTMENT OF CONSERVATION, DIVISION OF OIL, GAS, AND GEOTHERMAL RESOURCES, Defendant and Respondent; AERA ENERGY, LLC, Real Party in Interest and Appellant.

ASSOCIATION OF IRRITATED RESIDENTS et al., Plaintiffs and Appellants, v. CALIFORNIA DEPARTMENT OF CONSERVATION, DIVISION OF OIL,GAS, AND GEOTHERMAL RESOURCES, Defendant and Respondent;AERA ENERGY, LLC, Real Party in Interest and Appellant.

F078460

COURT OF APPEAL OF THE STATE OF CALIFORNIA FIFTH APPELLATE DISTRICT

April 8, 2020

NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS

California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.

(Super. Ct. No. S1500CV283418)

OPINION

APPEAL from a judgment of the Superior Court of Kern County. Eric Bradshaw, Judge.

Earthjustice, Stacey P. Geis, Gregory C. Loarie and Michelle Ghafar for Plaintiffs and Appellants.

Xavier Becerra, Attorney General, Daniel A. Olivas, Assistant Attorney General, Christina Bull Arndt and Wyatt E. Sloan-Tribe, Deputy Attorneys General, for Defendant and Respondent.

Alston & Bird, Jeffrey D. Dintzer and Matthew Wickersham for Real Party in Interest and Appellant.

-ooOoo-

Appellants Association of Irritated Residents, the Center for Biological Diversity, and the Sierra Club (collectively petitioners) filed a petition for writ of mandate in Kern County Superior Court challenging the actions of the Department of Conservation, Division of Oil, Gas, and Geothermal Resources (DOGGR) in issuing 213 permits to drill new oil wells within the South Belridge oil field.¹ South Belridge oil field, located in western Kern County, is one of California's most productive oil fields and is densely arrayed with thousands of existing oil wells. The challenged permits to drill new oil wells were issued by DOGGR in 2014 to the real party in interest herein, Aera Energy, LLC (Aera). According to the petition, DOGGR failed to comply with the California Environmental Quality Act (Pub. Resources Code, § 21000 et seq.; CEQA)² when it issued each of the individual permits to Aera because, allegedly, no CEQA exemption was available and DOGGR failed in each instance to conduct any environmental review. Both DOGGR and Aera opposed the petition, each arguing CEQA was not violatedbecause certain statutory and categorical exemptions applied. The exemptions asserted by one or both parties included the statutory exemption for ministerial projects, the statutory exemption for ongoing pre-CEQA projects, and categorical exemptions relating to minor alterations to existing facilities and to land.

The trial court, after considering the administrative record and the parties' respective legal arguments, denied the petition for writ of mandate on the ground the permit approvals were ministerial and therefore not subject to CEQA. Petitioners have appealed from the resulting judgment. We conclude the trial court correctly denied the petition for writ of mandate. Although most of the exemption claims were deficient, one was clearly applicable. Under the narrow facts of this case, including DOGGR's adoption of specific field rules applicable to drilling wells in the South Belridge oil field, we hold that DOGGR's approvals to drill the new wells in question were ministerial in nature. As will be seen, the field rules, understood in light of foundational regulatory provisions and supplemented by a technical manual referenced in the field rules themselves, constituted fixed objective standards that delineated the technical specifications for drilling new wells at that particular oil field. Thus, DOGGR's role in approving the subject new wells—wells that DOGGR acknowledged were "routine"—was simply to confirm whether the proposals conformed to those fixed objective standards. As such, the unique scenario that was presented here fit the CEQA definition of what constitutes ministerial decisionmaking. Accordingly, the judgment of the trial court is affirmed.

FACTS AND PROCEDURAL HISTORY

The Subject Permits Issued by DOGGR in 2014

The process of obtaining approvals from DOGGR to drill new oil wells is set forth in section 3203 of the Public Resources Code as follows: "The operator of any well, before commencing the work of drilling the well, shall file with the supervisor or the district deputy [of DOGGR] a written notice of intention to commence drilling. Drillingshall not commence until approval is given by the supervisor or the district deputy. If the supervisor or the district deputy fails to give the operator written response to the notice within 10 working days from the date of receipt, that failure shall be considered as an approval of the notice and the notice, for the purposes and intents of this chapter, shall be deemed a written report of the supervisor. If operations have not commenced within 24 months of receipt of the notice, the notice shall be deemed canceled, the notice shall not be extended, and the cancellation shall be noted in the division's records. The notice shall contain the pertinent data the supervisor requires on printed forms supplied by the division or on other forms acceptable to the supervisor. The supervisor may require other pertinent information to supplement the notice." (Pub. Resources Code, § 3203, subd. (a).)³

In 2014, Aera filed notices of intention (or NOI's) under section 3203 to commence drilling new wells at specified locations within the South Belridge oil field.⁴ In response, DOGGR granted approvals to the NOI's submitted by Aera, with each such approval granted on a form entitled "Permit to Conduct Well Operations." At least 213 such permits were issued by DOGGR to Aera between July and November 2014.⁵ The permits were granted with certain conditions imposed on the operator, Aera, such as the use of specified blowout prevention equipment, the maintenance of sufficient hole fluid quality and quantity, specified well casing requirements, and directions to avoid exposure to hydrogen sulfide gas and for the proper disposal of hole fluids. Of the permitted wells,204 were actually drilled by Aera, while one of the drilled wells was subsequently abandoned. At the commencement of this CEQA litigation, 203 of the new wells that were drilled pursuant to the challenged permits were in operation. The parties' briefing indicates the 203 wells have continued to be in operation at the time of this appeal.

The Petition for Writ of Mandate

Petitioners filed their petition for writ of mandate in the trial court on November 12, 2014. According to the petition, DOGGR is the state agency charged with the regulation of drilling, operation, maintenance, plugging and abandonment of oil, gas and geothermal wells within the state of California and, for purposes of the permits at issue in this case, was the CEQA lead agency in permitting oil and gas wells in Kern County. As noted, the petition claims that DOGGR failed to comply with CEQA because it issued each of the 213 permits to Aera to drill new oil wells in the South Belridge oil field without conducting any environmental review. The petition alleges that drilling and operation of oil wells and the utilization of certain enhanced well stimulation techniques for extracting oil such as hydraulic fracturing (commonly known as "fracking") create significant environmental risks and impacts. Among the environmental concerns expressed in the petition were air pollution, land or water contamination, and high volume water usage.

Following an initial round of demurrers, petitioners filed their first amended petition on May 15, 2015. Although the allegations of the original petition and first amended petition describe environmental effects of hydraulic fracturing, it is not disputed that any approvals by DOGGR to engage in such well stimulation treatments entailed separate and distinct permits applied for and granted after the issuance of the initial permits at issue here to drill new wells. (See § 3160, subd. (d) [describing separate permit requirement for engaging in well stimulation treatments such as hydraulic fracturing or acid well stimulation treatments].) As acknowledged by petitioners in their first amended petition, the notices of intent to drill the 213 new oil wells did not mentionenhanced well stimulation treatments such as fracking. Rather, sometime after receiving the initial permits to drill the new wells, Aera subsequently sought approvals to engage in well stimulation treatments regarding a number of the same wells under the statutory process set forth in section 3160, subdivision (d), which proposals were approved by DOGGR under separate permits for 144 of the challenged wells. The bottom line is that the present case relates solely to the initial 213 permits to drill new oil wells, not to the subsequently issued permits to engage in well stimulation treatments such as fracking.

In 2015, DOGGR and Aera filed demurrers attacking petitioners' CEQA claims. DOGGR argued in its demurrer that its approvals of the 213 permits to drill new wells at the South Belridge oil field qualified for statutory and categorical exemptions from CEQA. Aera argued petitioners' writ of mandate action was barred by res judicata because of the effect of an Alameda County Superior Court judgment, and further argued that the passage of recent legislation known as Senate Bill No. 4 precluded petitioners' claims.⁶ The trial court declined to reach the CEQA exemption issues on demurrer, and all grounds for demurrer were overruled other than res judicata. Ultimately, the trial court sustained the demurrer on the ground of res judicata without leave to amend. On appeal from the ensuing judgment, we held that res judicata was inapplicable because the prior decision in the Alameda County action was based on mootness or lack of ripeness and therefore it was not a judgment on the merits. (Association of Irritated Residents v. Department of Conservation (2017) 11 Cal.App.5th 1202, 1207, 1229.) Accordingly, we reversed the...