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Environment & Energy Report

Trump’s Rollback of Fracking Rule Upheld By Court (2)

March 27, 2020, 4:18 PMUpdated: March 27, 2020, 6:37 PM

The Trump administration didn’t break the law when it scrapped an Obama-era regulation for fracking on public and tribal lands, a court ruled Friday.

The U.S. District Court for the Northern District of California rejected a legal challenge from California and a coalition of environmental groups.

Judge Haywood S. Gilliam Jr. wrote that the Bureau of Land Management provided a “reasoned explanation” for its decision to rescind the Obama administration’s rule.

“Although BLM could have provided more detail, it did enough to clear the low bar of arbitrary and capricious review, and that is all the law requires,” he wrote, referring to the Administrative Procedure Act.

The decision is a stinging loss for conservation groups and states that have fought for years for stronger oil and gas regulations, especially in the wake of the development boom sparked by advances in hydraulic fracturing and horizontal drilling technology. Environmental groups are considering whether to appeal.

The Trump administration celebrated the court’s decision.

“This ruling will allow the Department to continue to implement the President’s direction to repeal overly burdensome regulations and ensure America’s energy independence, while protecting the safety of our workers and the health of our environment,” the Interior Department said in a statement.

‘Faithfully Applied’

Baker & Hostetler LLP attorney Mark S. Barron, who represents the Independent Petroleum Association and Western Energy Alliance in the case, praised the court for upholding the rescission of what the industry considered an unnecessary rule.

“We’re very happy with the result,” he said Friday, saying the court “faithfully applied administrative law,” which allows administrations to change course from their predecessors’ actions, so long as they explain their decisions.

The BLM finalized the rule in 2015 after five years of public pressure, setting restrictions for construction, wastewater management, and chemical disclosure for fracked oil and gas wells.

Industry groups, conservative Western states, and some energy-producing American Indian tribes fiercely opposed the measures and successfully persuaded a district court in Wyoming to strike down the rule—though an appeals court later vacated that decision.

The Trump administration scrapped the regulation in 2017, seeking to loosen regulatory burdens on energy production.

Decision Details

California and the environmental coalition challenged the rollback under the Administrative Procedure Act, National Environmental Policy Act, and Endangered Species Act. The court rejected all the claims, and ruled that the environmental groups lacked standing to bring their APA claims in the first place.

The office of California Attorney General Xavier Becerra said it was reviewing the decision.

Environmental groups say they’re considering pushing the case to the U.S. Court of Appeals for the Ninth Circuit.

“We’re certainly disappointed, and we’ll be looking at our options, including a possible appeal,” Earthjustice attorney Michael Freeman, who represents the coalition, said in an interview.

“It’s important because BLM has been operating under totally outdated and inadequate regulations that were issued almost 40 years ago now, before hydraulic fracturing became commonplace,” he added.

The environmental coalition includes the Sierra Club. The Sierra Club has received funding from Bloomberg Philanthropies, the charitable organization founded by Michael Bloomberg. Bloomberg Environment is operated by entities controlled by Michael Bloomberg.

The case is California v. BLM, N.D. Cal., No. 4:18-cv-00521, 3/27/20

(Adds Interior Department statement.)

To contact the reporter on this story: Ellen M. Gilmer in Washington at egilmer@bloombergenvironment.com

To contact the editors responsible for this story: Gregory Henderson at ghenderson@bloombergenvironment.com; Chuck McCutcheon at cmccutcheon@bloombergenvironment.com; Anna Yukhananov at ayukhananov@bloombergenvironment.com

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