Challenge to Montana Energy Plan Must Be Rejected

Challenge to Montana Energy Plan Must Be Rejected

  William Perry Pendley, President and Chief Operating Officer of Mountain States Legal Foundation

DENVER, CO.  A Montana voluntary, non-profit trade association-whose members include oil and natural gas producers, gathering and pipeline companies, petroleum refineries, and service providers and consultants-that strives to maintain a favorable climate for the petroleum industry today filed a motion for summary judgment urging a Montana state court to dismiss a challenge by two environmental groups to the Montana Board of Oil and Gas Conservation's approval of 23 new gas wells in eastern Montana.  The Montana Petroleum Association, arguing that the challenge fails factually and legally, urged the Fallon County district court to dismiss the groups' lawsuit.  The Association, whose members will be affected if the court grants the relief sought by the groups, argues that invalidation of the new drilling permits will force preparation of a programmatic environmental study for eastern Montana, which will shut down all oil and gas drilling throughout the State of Montana.

"The groups ceded their constitutional claims, lack standing to contest the legality of the leasing process, and failed to prove either harm to the sage grouse or a violation of state law," said William Perry Pendley, Esq., of Mountain States Legal Foundation, which represents the association.

In 1915, a natural gas field was discovered in the Cedar Creek Anticline in Fallon and Carter Counties of far-eastern Montana.  In 1925, gas production began, and, by 1995, the Cedar Creek gas field consisted of 150 wells producing approximately 10 billion cubic-feet of natural gas per year.  Since 1995, both the number of wells and the gas produced have expanded significantly.  Before 1997, gas well spacing rules limited development to one well per 320 acres.  In 1997, well spacing was increased to one well per 160 acres.  In 2003, well spacing was again increased to one well per 32 acres.  This spacing continues today. 

In 1998, a programmatic environmental impact statement was prepared by the Montana Board of Oil and Gas Conservation as to oil and gas drilling in Montana.  Pursuant to that study, as of 2008, more than 1,100 wells had been drilled; the Board of Oil and Gas Conservation estimates an average of an additional 71 wells will be added to the field per year. 

On August 11 and 12, 2008, the Board issued environmental assessments for 23 new gas wells proposed by Fidelity Exploration and Production Company in the Cedar Creek gas field.  On October 9, 2008, two environmental groups, the Montana Wildlife Federation and the National Wildlife Federation, filed suit in state court challenging the environmental assessments associated with approval of Fidelity's gas well permits.

Mountain States Legal Foundation, founded in 1977, is a nonprofit, public-interest law firm dedicated to individual liberty, the right to own and use property, limited and ethical government, and economic freedom.  Its offices are in suburban Denver, Colorado.

Montana Wildlife Federation v. Montana Board of Oil & Gas Conservation, No. 2008DV34 (Fallon County District Court)