Montana Supreme Court Briefed on Energy Case Appeal

Montana Supreme Court Briefed on Energy Case Appeal

DENVER - A Montana voluntary, nonprofit trade association of oil and natural gas producers, gathering and pipeline companies, petroleum refineries, and service providers and consultants that seeks to maintain a favorable climate for the petroleum industry on Jan. 23 filed its response to an appeal to the Montana Supreme Court of a Montana state court ruling that Montana complied with state law in approving new gas wells (Montana Wildlife Federation v. Montana Board of Oil & Gas Conservation, No. 2008DV34, Mont. Dist., Fallon Co.). 

The Montana Petroleum Association had intervened in the lawsuit filed by two environmental groups to contest their challenge of the Montana Board of Oil and Gas Conservation's approval of 23 infill natural gas wells in eastern Montana.  The groups challenged the adequacy of an environmental study and its analyses of the impact of oil and gas development on sage grouse.  The July 2011 ruling followed a hearing in Fallon County in May 2010.  The district court, over the Association's objections, did not determine that the groups lack standing and allowed the groups to present "expert" testimony; however, the rest of its ruling supported the Association's arguments. 

"The district court correctly granted summary judgment to our client," said William Perry Pendley of Mountain States Legal Foundation, which represents the Association.  "That ruling should be affirmed." 

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 increased 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 1989, 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 Aug. 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 legal foundation dedicated to individual liberty, the right to own and use property, limited and ethical government, and economic freedom.  Its offices are in suburban Denver.