Feds Can’t Halt Oil Lease Sales in North Dakota, Judge Rules

The Biden administration likely acted unlawfully when it canceled lease sales in North Dakota, a federal judge ruled Tuesday in granting a preliminary injunction to prevent federal agencies from stopping the leasing process.

The judge stopped short of granting North Dakota’s request to compel the lease sales to occur. The court also rejected the state’s request to compel federal agencies to hold the previously canceled quarterly lease sales for available lands.

North Dakota alleged that the Bureau of Land Management has wrongfully canceled or “postponed” seven of the eight quarterly lease sales in North Dakota since 2021, after Biden issued a moratorium freezing lease sales on federal lands while the administration reviewed the program. The state claimed that the the agency failed to comply with the Mineral Leasing Act, which requires lease sales to be held at least quarterly.

Federal oil leases had slowed to a trickle under the Biden administration—which pledged to shift the country away from fossil fuels—though the sales have been ramping up after the Interior Department resumed some oil and gas leasing in June 2022.

North Dakota has a fair chance of prevailing on its claim that the agency violated the MLA, Judge Daniel M. Traynor of the US District Court for the District of North Dakota wrote, partially granting the state’s motion for a preliminary injunction.

The federal government sought to justify the cancellations or postponements by saying it needed more time or that the National Environmental Policy analyses were incomplete. But there is no evidence that North Dakota canceled the sales because of a surprise NEPA issue or unexpected legal problem, Traynor said.

“The Federal Defendants’ attempt to justify their lease sale cancellation due to NEPA-related litigation and North Dakota’s spotty history of quarterly lease sales is misplaced,” Traynor said, as there have been NEPA concerns in other states for years and North Dakota had a backlog of NEPA analyses.

Traynor also found that North Dakota is likely to succeed in proving that BLM conducted withdrawals without following the proper public and congressional notice requirements under the Federal Land Policy and Management Act.

North Dakota is represented by its attorney general’s office and Greenberg Traurig LLP.

The case is North Dakota v. Dep’t of Interior, D.N.D., No. 1:21-cv-00148, 3/27/23.