Late last week, in a National Environmental Policy Act case, the Tenth Circuit affirmed previous rejections, by the Bureau of Land Management and the district court, of a phased plan for natural gas drilling in Wyoming's Powder River Basin. This plan, proposed by environmental and other groups as an alternative to another plan under BLM consideration, would have phased in development, delaying drilling for at least ten years and possibly decades. The other, more accelerated plan proposed by federal lessees, called for drilling within a ten-year period. Beyond this case, as noted below, the Tenth Circuit's decision presents a circuit split.
The Tenth Circuit found that rejecting the phased plan (or more specifically, rejecting the need for detailed study of the plan), was reasonable, since non-federal developers could take advantage of the extended delays—siphoning gas through other wells and obtaining what should be federal royalties. The panel also found that the mitigation strategies proposed were not feasible, e.g., profit-sharing agreements with private developers who would have no incentive to enter into such agreements. The panel also rejected the phased plan, among other reasons, because "delaying production for decades does not effectively meet current energy demands," one of BLM's project criteria.
In affirming the district court, though, the Tenth Circuit pointed out that another district court (Montana), in another circuit (Ninth), had required consideration of a phased plan for another project. Because the Ninth Circuit affirmed the Montana district court, last week's Tenth Circuit decision presents a circuit split on the phased plan issue.
