Case 1:22-cv-02168 Document 1 Filed 07/22/22 Page 1 of 22
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`IN THE UNITED STATES DISTRICT COURT
`FOR THE DISTRICT OF COLUMBIA
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`WESTERN WATERSHEDS PROJECT,
`126 S Main Street, Suite B
`P.O. Box 1770
`Hailey, ID 83333,
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`
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`Case No. 22-cv-2168
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`COMPLAINT FOR DECLARATORY
`AND INJUNCTIVE RELIEF
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`Plaintiff,
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`v.
`
`
`BUREAU OF LAND MANAGEMENT,
`1849 C Street N.W.
`Washington, DC 20240,
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`
`
`
`Defendant.
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`INTRODUCTION
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`1.
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`This case challenges the Bureau of Land Management’s (BLM) issuance of
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`Permanent Instruction Memorandum 2018-014 (PIM 2018-014), which pertains to the
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`development of federal oil and gas minerals from “Fee/Fee/Fed” wells.
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`2.
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`Fee/Fee/Fed wells are those that drill directionally into subsurface federal
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`minerals from adjacent non-federal lands overlying non-federal mineral estate. The use of
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`Fee/Fee/Fed wells has surged over the past decade due to advances in directional drilling
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`technologies. Whereas federal oil and gas leases were traditionally developed from the lease
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`surface itself, directional drilling and the checkerboard ownership pattern of western lands now
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`allows developers to tap federal minerals from adjacent private or state lands. Today, the
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`majority of BLM-permitted wells in top-producing states like Wyoming involve a Fee/Fee/Fed
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`scenario.
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`COMPLAINT - 1
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`Case 1:22-cv-02168 Document 1 Filed 07/22/22 Page 2 of 22
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`3.
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`In 2018, BLM issued PIM 2018-014, entitled “Directional Drilling into Federal
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`Mineral Estate from Well Pads on Non-Federal Locations.” PIM 2018-014 purports to strip
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`BLM officials of the power to regulate surface operations associated with Fee/Fee/Fed wells,
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`claiming it is beyond BLM’s jurisdiction. It also purports to relieve developers of various
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`bonding, reporting, and operating requirements for Fee/Fee/Fed wells.
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`4.
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`PIM 2018-014 creates an unwarranted loophole in BLM oversight of federal oil
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`and gas development. Since it was issued, BLM has approved the fracking and drilling of
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`hundreds of wells without any restrictions on toxic air emissions, water and soil contamination,
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`wildlife disruptions, noise and visual intrusions, and other impacts. This unchecked extraction of
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`publicly-owned minerals threatens significant public and environmental harm, including to
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`adjacent and downstream public lands and communities.
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`5.
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`PIM 2018-014 also violates federal law. The Mineral Leasing Act (MLA),
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`Federal Land Policy and Management Act (FLPMA), and their implementing regulations not
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`only authorize but require BLM to regulate Fee/Fee/Fed wells and prohibit the exemptions
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`granted by PIM 2018-014. In particular, the MLA requires BLM to “regulate all surface-
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`disturbing activities conducted pursuant to any” federal mineral lease. 30 U.S.C. § 226(g).
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`FLPMA further requires BLM to “regulate . . . [the] development of” federal minerals, 43 U.S.C.
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`§§ 1702(e), 1732(b), and to “take any action necessary to prevent unnecessary or undue
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`degradation of the lands,” id. § 1732(b). None of these authorities exempt federal mineral
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`development where surface facilities are located on nonfederal lands.
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`6.
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`Nor is BLM otherwise prohibited from regulating federal minerals in ways that
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`implicate nonfederal lands. To the contrary, BLM has authority flowing from the Property
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`Clause to “prohibit absolutely or fix the terms on which [federal] property may be used.” Light v.
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`COMPLAINT - 2
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`Case 1:22-cv-02168 Document 1 Filed 07/22/22 Page 3 of 22
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`United States, 220 U.S. 523, 536 (1911). Thus, like any other mineral estate owner, BLM has
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`authority to condition the extraction of federal minerals on the developer’s agreement to engage
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`in, or refrain from, certain conduct on private lands. Separately, the Property Clause authorizes
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`the regulation of conduct on private lands, such as development of Fee/Fee/Fed wells, so as to
`protect nearby public lands. United States v. Alford, 274 U.S. 264, 267 (1927).
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`7.
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`In adopting PIM 2018-014, BLM failed to consider these legal authorities, resting
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`instead on an unadorned and untenable disavowal of jurisdiction.
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`8.
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`Accordingly, Plaintiff Western Watersheds Project seeks an order vacating PIM
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`2018-014 and declaring that BLM’s issuance of PIM 2018-014 was arbitrary, capricious, and not
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`in accordance with law.
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`JURISDICTION AND VENUE
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`9.
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`The Court has subject matter jurisdiction pursuant to 28 U.S.C. § 1331 because
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`this action arises under federal law.
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`10.
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`The Court is authorized to award the requested relief under 28 U.S.C. §§ 2201,
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`2202 and 5 U.S.C. §§ 702, and 706.
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`11.
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`The challenged agency actions are final and subject to judicial review pursuant to
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`5 U.S.C. §§ 702, 704, and 706.
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`12.
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`Venue is proper in this Court under 28 U.S.C. § 1391(e) because Defendant BLM
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`is based in Washington, D.C., BLM adopted PIM 2018-104 in this district, and BLM applies
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`PIM 2018-014 on a nationwide basis in administering its oil and gas program.
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`PARTIES
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`13.
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`Plaintiff WESTERN WATERSHEDS PROJECT (WWP) is a non-profit
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`membership organization founded in 1993 with the mission of protecting and restoring public
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`COMPLAINT - 3
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`lands and natural resources of the American West. WWP is actively engaged in efforts to protect
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`and preserve native ecosystems, watersheds, fish and wildlife, and other natural resources and
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`ecological values throughout the West.
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`14. WWP has over 12,000 members, supporters, staff, and board members throughout
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`the United States, including in Montana, Nevada, New Mexico, Wyoming, Utah, and other states
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`where federal oil and gas leases are being auctioned and developed. Many of these individuals
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`live, work, and recreate in lands impacted or threatened by Fee/Fee/Fed well development, and
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`view wildlife affected by Fee/Fee/Fed well development. They derive recreational, educational,
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`inspirational, scientific, and aesthetic benefit from their activities on these lands, and intend to
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`continue doing so in the future.
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`15.
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`As a result of PIM 2018-014, the development of Fee/Fee/Fed wells will entail
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`more harmful impacts to the viewsheds, air quality, water, wildlife, native vegetation, and other
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`natural resources that Plaintiffs’ staff and members use and enjoy. Accordingly, BLM’s issuance
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`of PIM 2018-014 has and will continue to injure the aesthetic, recreational, and other interests of
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`Plaintiff’s staff, members, and supporters, if not vacated. The requested relief would remedy
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`those harms. Apart from this action, Plaintiffs and their staff, members, and supporters have no
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`adequate remedy at law to address the foregoing injuries to their interests.
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`16.
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`Defendant BUREAU OF LAND MANAGEMENT (BLM) is the agency within
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`the U.S. Department of Interior responsible for carrying out the Department’s legal obligations
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`and authority as to the development of federal oil and gas resources. BLM is headquartered in
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`Washington, D.C., where it developed and issued PIM 2018-014.
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`COMPLAINT - 4
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`BACKGROUND
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`A.
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`17.
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`BLM AUTHORITY OVER THE DEVELOPMENT OF FEDERAL OIL
`AND GAS RESOURCES
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`BLM oversees more than 245 million acres of land and 700 million subsurface
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`acres of federal mineral estate. Congress has delegated to BLM, through the Secretary of
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`Interior, plenary authority over these resources pursuant to a patchwork of statutes, including the
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`MLA and FLPMA. Congress’s authority for these delegations of power, in turn, is the Property
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`Clause of Article IV the U.S. Constitution.
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`18.
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`These and other authorities vest BLM with considerable power and duties to
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`regulate both the surface and downhole operations associated with Fee/Fee/Fed well
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`development.
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`i.
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`Property Clause of the U.S. Constitution
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`19.
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`BLM’s authority over Fee/Fee/Fed wells is grounded in the Property Clause of
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`Article IV of the U.S. Constitution, which declares that “Congress shall have Power to dispose of
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`and make all needful Rules and Regulations respecting the Territory or other Property belonging
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`to the United States." U.S. Const. art. IV, sec. 3, cl. 2.
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`20.
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`21.
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`Federal mineral estate is property belonging to the United States.
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`The Property Clause vests Congress with essentially two kinds of power:
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`“proprietary” and “sovereign.” See Light v. United States, 220 U.S. 523, 536–38 (1911). The
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`proprietary power encompasses the right to “prohibit absolutely or fix the terms on which
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`[federal] property may be used.” Id. at 536 This power is “without limitations” and Congress is
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`free to fashion whatever limits it chooses “consistent with its views of public policy[.]” United
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`States v. City of San Francisco, 310 U.S. 16, 29–30 (1940). The sovereign power encompasses
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`COMPLAINT - 5
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`the right to “legislat[e] for the protection of the public lands.” Camfield v. United States, 167
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`U.S. 518, 525–26 (1897).
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`22.
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`Both powers permit regulation of conduct on nonfederal land. See Kleppe v. New
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`Mexico, 426 U.S. 529, 538 (1976) (“the Property Clause is broad enough to reach beyond
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`territorial limits.”).
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`23.
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`First, by virtue of its proprietary authority, the federal government may condition
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`the use of its property on the developer’s agreement to engage in, or refrain from, certain
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`activities on private lands. See, e.g., City of San Francisco, 310 U.S. at 28–30; Federal Power
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`Comm’n v. Idaho Power Co., 344 U.S. 17 (1952) (both upholding a federal land use condition
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`affecting nonfederal property).
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`24.
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`Second, pursuant to its sovereign authority, the federal government may regulate
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`private activities on nonfederal property that affect public lands. See United States v. Alford, 274
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`U.S. 264, 267 (1927) (“Congress may prohibit the doing of acts upon privately owned lands that
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`imperil” public lands); Camfield, 167 U.S. at 528 (holding that the Property Clause permits
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`federal regulation of fences built on private land adjoining public land).
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`25.
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`Congress has delegated its Property Clause authority to the Secretary of Interior
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`through a patchwork of statutes. In addition to delegations under the MLA and FLPMA
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`described below, Congress has broadly charged the Secretary with “perform[ing] all executive
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`duties . . . anywise respecting . . . public lands,” 43 U.S.C. § 2 , and supervising all “public
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`business relating to . . . [p]ublic lands, including mines[.]” 43 U.S.C. § 1457. Congress further
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`authorized the Secretary to “enforce and carry into execution, by appropriate regulations, every
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`part of the provisions of . . . [the Title dealing with public lands] not otherwise specifically
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`provided for.” 43 U.S.C. § 1457c.
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`COMPLAINT - 6
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`26.
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`The Supreme Court has held that these enactments vest the Secretary of Interior
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`with “plenary authority” over the public lands and minerals. Best v. Humboldt Placer Min. Co.,
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`371 U.S. 334, 336 (1963); see also Boesche v. Udall, 373 U.S. 472, 476 (1963).
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`27.
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`The Supreme Court has also held that authority over federal lands and minerals
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`falls “wholly and absolutely within the jurisdiction” of the Secretary of Interior “in the absence
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`of some specific provision to the contrary[.]” Corp. of the Catholic Bishop of Nesqually v.
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`Gibbon, 158 U.S. 155 (1895); see also Cameron v. United States, 252 U.S. 450 (1920) (“Unless
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`taken away by some affirmative provision of law, the Land Department has jurisdiction over the
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`subject.”) (quoting Cosmos Exploration Co. v. Gary Eagle Oil Co., 190 U.S. 301, 308 (1903).
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`ii.
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`Federal Land Policy and Management Act (FLPMA)
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`28.
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`The Federal Land Policy and Management Act (FLPMA), 43 U.S.C. §§ 1701–87,
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`vests in the Secretary of Interior general management authority over the public lands. Id. § 1732.
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`29.
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`The Secretary has delegated this authority to the BLM. Dep’t of Interior, 235
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`Departmental Manual 1 (Oct. 5, 2009); Dep’t of Interior, 235 Departmental Manual 3 (May 27,
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`1983).
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`30.
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`The term “public lands” as used in FLPMA includes any interest in land owned
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`by the United States, including federal mineral estate. 43 U.S.C. § 1702(e); 43 C.F.R. § 5400.0-
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`5.
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`31.
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`FLPMA provides that the Secretary “shall regulate the use, occupancy, and
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`development of the public lands.” 43 U.S.C. § 1732(b).
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`32.
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`FLPMA provides that the Secretary “shall” manage public lands “for multiple use
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`and sustained yield.” Id. § 1732(a). Its definition of “multiple use” calls for “harmonious and
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`coordinated management of the various resources without permanent impairment of the
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`COMPLAINT - 7
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`productivity of the land and the quality of the environment with consideration being given to the
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`relative values of the resources and not necessarily the combination of uses that will give the
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`greatest economic return or the greatest unit output.” Id. § 1702(c).
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`33.
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`FLPMA further directs that the Secretary “shall” take any action necessary to
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`prevent “unnecessary or undue degradation” of public lands. Id. § 1732(b). This duty is “the
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`heart of FLPMA.” Mineral Policy Center v. Norton, 292 F. Supp.2d 30, 42. (D.D.C. 2003).
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`34.
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`It announces a broader policy that public lands and minerals be managed “in a
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`manner that will protect the quality of scientific, scenic, historical, ecological, environmental, air
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`and atmospheric, water resource, and archeological values.” 43 U.S.C. § 1701(a)(8).
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`35.
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`FLPMA also authorizes the Secretary of Interior to “issue regulations necessary to
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`implement the provisions of [FLPMA] with respect to the management, use, and protection of
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`the public lands.” Id. § 1733(a).
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`36.
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`Pursuant to FLPMA, BLM has issued general regulations governing leases,
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`easements, and permits to use public lands. See 43 C.F.R. pt. 2920. They require BLM to include
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`terms and conditions in every lease and permit that “[m]inimize damage to scenic, cultural and
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`aesthetic values, fish and wildlife habitat and otherwise protect the environment,” “[p]rotect the
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`interests of individuals living in the general area of the use who rely on the fish, wildlife and
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`other biotic resources of the area for subsistence purposes,” “[r]equire the use to be located in an
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`area which shall cause least damage to the environment,” and “[o]therwise protect the public
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`interest.” Id. § 2920.7(b)(2)–(3), (c)(4)–(6).
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`iii. Mineral Leasing Act (MLA)
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`37.
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`Congress has repeatedly directed the Secretary of Interior to oversee the
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`development of federal oil and gas deposits, including through the Mineral Leasing Act of 1920
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`COMPLAINT - 8
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`(MLA), 30 U.S.C. §§ 181–287, and the Mineral Leasing Act for Acquired Lands of 1947
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`(MLAAL), 30 U.S.C. §§ 351–59 (extending MLA to acquired land).
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`38.
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`In enacting the MLA, Congress sought to “expand, not contract, the Secretary’s
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`control over the mineral lands of the United States” and to “reserv[e] to the Government the right
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`to supervise, control, and regulate” the development of federal mineral resources. Boesche, 373
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`U.S. at 481 (quoting H.R. Rep. No. 65-1138, at 19 (1919) (Conf. Rep.)).
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`39.
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`The Secretary fully delegated this authority to BLM for onshore minerals on
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`federal lands. See 48 Fed. Reg. 8,803, 8,983 (Mar. 2, 1983); Dep’t of Interior, 235 Departmental
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`Manual 1.1 (Oct. 5, 2009).
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`40.
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`Pursuant to this delegated authority, BLM has promulgated regulations under the
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`MLA governing onshore oil and gas operations. 43 C.F.R. pt. 3160.
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`41.
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`The MLA authorizes the Secretary of the Interior to offer certain federal minerals
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`for lease, including oil and gas. 30 U.S.C. § 226. It subjects such leases “to exacting restrictions
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`and continuing supervision by the Secretary[.]” Boesch, 373 U.S. at 477–78.
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`42.
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`In particular, the MLA provides that the Secretary of Interior “shall regulate all
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`surface-disturbing activities conducted pursuant to any lease issued under this chapter, and shall
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`determine reclamation and other actions as required in the interest of conservation of surface
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`resources.” 30 U.S.C. § 226(g). Congress did not confine this duty to surface disturbance on
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`federal lands.
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`43.
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`Leaseholders must submit an Application for Permit to Drill (APD) “for each
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`well” proposed to be drilled into a lease, 43 C.F.R. § 3162.3-1(c), and “[n]o drilling operations,
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`nor surface disturbance preliminary thereto, may be commenced prior to the authorized officer’s
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`approval of the [APD].” Id.
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`COMPLAINT - 9
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`44.
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`A “complete” APD must include a “surface use plan of operations.” Id. § 3162.3-
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`1(d)(2).
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`45.
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`Each well must be drilled at a location that has been “surveyed” and “approved or
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`prescribed” by BLM. Id. § 3162.3-1(a).
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`46.
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`BLM has broad discretion to attach terms and conditions, known as “Conditions
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`of Approval,” to an approved APD. In addition to those provided for in the lease itself, BLM
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`may subject an APD to any “reasonable measures . . . to minimize adverse impacts to other
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`resource values, land uses or users” as well as “restrictions deriving from specific,
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`nondiscretionary statutes.” Id. § 3101.1-2.
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`47.
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`In addition to such Conditions of Approval, leaseholders are required by
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`regulation to “conduct operations in a manner which protects the mineral resources, other natural
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`resources, and environmental quality,” id. § 3162.5-1(a), and to “exercise due care and diligence
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`to assure that leasehold operations do not result in undue damage to surface or subsurface
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`resources,” id. § 3162.5-1(b).
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`48.
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`The MLA also requires the Secretary to collect a bond sufficient “to ensure the
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`complete and timely reclamation of the lease tract, and the restoration of any lands or surface
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`waters adversely affected by lease operations after the abandonment or cessation of oil and gas
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`operations on the lease.” Id.
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`49.
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`BLM regulations similarly require every lease operator to post a bond sufficient to
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`ensure “complete and timely plugging of the well(s), reclamation of the lease area(s), and the
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`restoration of any lands or surface waters adversely affected by lease operations[.]” Id. §
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`3104.1(a).
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`COMPLAINT - 10
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`50.
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`BLM regulations further specify that the operator must “reclaim the disturbed
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`surface” upon the conclusion of operations. Id. § 3162.5-1(b); see also id. § 3162.3-4 (“Upon the
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`removal of drilling or producing equipment from the site of a well which is to be permanently
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`abandoned, the surface of the lands disturbed in connection with the conduct of operations shall
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`be reclaimed in accordance with a plan first approved or prescribed by the authorized officer.”).
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`51.
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`None of the aforementioned regulations are limited to impacts or activities on
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`federal lands or the leasehold itself, as are other sections of this same subchapter. See, e.g., id. §
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`3163.1 (imposing a penalty for unapproved “surface disturbance on Federal or Indian surface”);
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`id. § 3162.3-3 (imposing requirements for surface disturbance “on the leasehold”); id. §
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`3104.1(a) (specifying requirement applicable to “the lease area”).
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`52.
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`In addition to these specific directives, the MLA broadly authorizes BLM to
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`“prescribe necessary and proper rules and regulations and to do any and all things necessary to
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`carry out and accomplish the purposes” of the Act. 30 U.S.C. § 189. The MLA’s purposes
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`include protecting “the interests of the United States,” safeguarding “the public welfare,” and
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`conservation of surface resources. Id. §§ 187, 226.
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`iv.
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`Onshore Order 1
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`53.
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`BLM regulations authorize the BLM Director to issue Onshore Oil and Gas
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`Orders when necessary to implement and supplement the regulations found in part 3160. 43
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`C.F.R. § 3164.1. Onshore Oil and Gas Orders are binding. Id.
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`54.
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`Onshore Order 1 has been in effect since October 21, 1983, and was most recently
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`revised in 2017. See Onshore Oil and Gas Order 1, 72 Fed. Reg. 10,308, 10,331 (Mar. 7, 2007);
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`82 Fed. Reg. 2906 (January 10, 2017) (amendment).
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`COMPLAINT - 11
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`55.
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`Onshore Order 1 provides that a complete APD package “must contain . . . a
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`Surface Use Plan of Operations.” 72 Fed. Reg. at 10,329.
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`56.
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`It also prohibits operators from “commenc[ing] either drilling operations or
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`preliminary construction activities before the BLM’s approval of the APD” and provides that
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`“[d]rilling without approval or causing surface disturbance without approval is a violation of 43
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`CFR 3162.3–1(c) and is subject to a monetary assessment under 43 CFR 3163.1(b)(2).”
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`57.
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`Onshore Order 1 confirms that BLM, in determining the bond amount, “may
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`consider impacts of activities on . . . non-Federal lands required to develop the lease that impact
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`lands, waters, and other resources off the lease[.]” 72 Fed. Reg. at 10,333.
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`58.
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`It further requires operators to “conduct operations to minimize adverse effects to
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`surface and subsurface resources, prevent unnecessary surface disturbance, and conform with
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`currently available technology and practice” and provides that “[i]f historic or archaeological
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`materials are uncovered during construction, the operator must immediately stop work that might
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`further disturb such materials [and] contact the BLM.”
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`v.
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`BLM Standard Lease Forms
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`59.
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`In addition to these sources of statutory, and regulatory authority, BLM retains
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`broad contractual rights under the standard terms of its oil and gas leases to regulate the manner
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`in which the leased minerals are developed.
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`60.
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`Section 6 of BLM’s standard lease form requires the leaseholder to “conduct
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`operations in a manner that minimizes adverse impacts to the land, air, and water, to cultural,
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`biological, visual, and other resources, and to other land uses or users.” It permits BLM to
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`impose “reasonable measures deemed necessary . . . to accomplish the intent of this section.”
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`COMPLAINT - 12
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`61.
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`Section 12 of the standard lease form requires the leaseholder, at the conclusion of
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`operations, to “reclaim the land.”
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`62. Whereas the standard lease form elsewhere uses the term “leased lands” and
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`“leased premises” when specifying provisions applicable to the lease surface itself, these
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`operations and reclamation requirements are not limited to operations on the lease surface.
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`B.
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`63.
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`BLM’S ADOPTION OF PIM 2018-014
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`BLM issued Permanent Instruction Memorandum (PIM) 2018-04, entitled
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`“Directional Drilling Into Federal Mineral Estate From Well Pads on Non-Federal Locations,”
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`on June 12, 2018 to all BLM field offices. See https://www.blm.gov/policy/pim-2018-014. The
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`document states that it supersedes prior Instruction Memorandum (IM) 2009-078.
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`64.
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`Brian C. Steed, then-BLM Deputy Director of Policy and Programs, signed PIM
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`2018-014.
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`65.
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`PIM 2018-014 provides directions to BLM staff regarding APD processing for
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`“wellbores that produce Federal minerals from well pads that are located on . . . lands where both
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`the surface and the mineral estate are not owned or managed by the United States.” These wells
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`are commonly referred to as “Fee/Fee/Fed” wells, with “Fee” referring to ownership other than
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`federal.
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`66.
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`Fee/Fee/Fed wells differ from “split-estate” wells, in which the drill site is located
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`on non-federal surface directly overlying federal minerals.
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`67.
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`PIM 2018-014 states that “BLM’s regulatory jurisdiction is limited to Federal
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`lands (including minerals). . . . BLM’s jurisdiction extends to surface facilities on entirely non-
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`Federal lands solely to the extent of assuring production accountability for royalties from Federal
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`COMPLAINT - 13
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`Case 1:22-cv-02168 Document 1 Filed 07/22/22 Page 14 of 22
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`and Indian oil and gas (including prevention of theft, loss, waste, and assuring proper
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`measurement).”
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`68.
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`It further asserts that BLM lacks authority “to require mitigation of surface
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`disturbances on non-Federal lands.”
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`69.
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`As to bond requirements, PIM 2018-014 states that “bonds for Fee/Fee/Fed wells
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`should be used to address downhole concerns only” and that “BLM does not have authority to
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`require a bond to protect non-Federal surface owner interests.”
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`70.
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`PIM 2018-014 further provides that a Surface Use Plan of Operations (SUPO) is
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`not required for Fee/Fee/Fed wells, and that if submitted, BLM will not enforce its provisions.
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`Relatedly, it asserts that “BLM has no jurisdiction to require an APD before an operator may
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`begin pad and road construction or drilling on the non-Federal land,” and that an “APD approval
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`is necessary before an operator may drill into the Federal mineral estate itself.”
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`71.
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`PIM 2018-014 contains no analysis of the applicable legal authorities or
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`explanation of how its terms are consistent with them.
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`C.
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`72.
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`PIM 2018-014 MISCONSTRUES AND CONTRAVENES FEDERAL LAW
`PERTAINING TO FEE/FEE/FED WELLS.
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`PIM 2018-014 fundamentally misconstrues the scope of BLM jurisdiction over
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`Fee/Fee/Fed wells and improperly exempts both BLM and lease operators of various bonding,
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`reporting, and operational requirements for these projects in the following key ways:
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`i.
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`Mitigation of Surface Disturbances
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`73.
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`PIM 2018-014 claims that BLM lacks authority “to require mitigation of surface
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`disturbances on non-Federal lands.”
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`COMPLAINT - 14
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`Case 1:22-cv-02168 Document 1 Filed 07/22/22 Page 15 of 22
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`74.
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`This violates the plain text of the MLA, which requires BLM to regulate “all
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`surface-disturbing activities conducted pursuant to” federal mineral leases. 30 U.S.C. § 226(g)
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`(underscore added). Congress did not confine this duty to surface disturbance on federal lands.
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`75.
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`It further violates FLPMA, which provides that BLM “shall . . . regulate . . . the
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`development” of federal minerals. 43 U.S.C. §§ 1732(b) (underscore added); see also 1702(e)
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`(definition of public lands). This broad delegation places no restrictions on BLM’s authority to
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`regulate activities on nonfederal lands used to develop federal minerals.
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`76.
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`BLM’s disclaimer of authority also contravenes its statutory duty under FLPMA
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`to manage federal mineral development so as to protect air and atmospheric values, 43 U.S.C. §§
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`1701(a)(8), 1732(b), and to “take any action necessary to prevent unnecessary or undue
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`degradation of the lands,” 43 U.S.C. § 1732(b). The term “any action” admits of no exceptions.
`
`77.
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`It is also inconsistent with BLM regulations, which require every BLM permit to
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`include terms and conditions that “[m]inimize damage to scenic, cultural and aesthetic values,
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`fish and wildlife habitat and otherwise protect the environment,” “[p]rotect the interests of
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`individuals living in the general area of the use who rely on the fish, wildlife and other biotic
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`resources of the area for subsistence purposes,” “[r]equire the use to be located in an area which
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`shall cause least damage to the environment,” and “[o]therwise protect the public interest.” 43
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`C.F.R. § 2920.7(b)(2)-(3), (c)(4)-(6). These requirements are not limited to the leasehold itself,
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`as are other sections of this same subchapter. See, e.g., id. §§ 3104.1(a), 3162.3-3, 3163.1.
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`78.
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`BLM’s onshore oil and gas regulations also permit the agency to subject an APD
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`to any “reasonable measures . . . to minimize adverse impacts to other resource values, land uses
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`or users[.]” Id. § 3101.1-2; see also id. § 3162.5-1. BLM’s standard lease form and Onshore
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`COMPLAINT - 15
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`Case 1:22-cv-02168 Document 1 Filed 07/22/22 Page 16 of 22
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`Order 1 contain similar authorizations. These provisions do not prohibit BLM from conditioning
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`its APD approvals on mitigation measures implicating nonfederal lands.
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`ii.
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`Surface Use Plan of Operations
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`79.
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`PIM 2018-014 provides that a Surface Use Plan of Operations will not be required
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`for Fee/Fee/Fed wells, and that if one is submitted, BLM will treat it as “purely informational”
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`and will not “approve, disapprove, or enforce” the Plan.
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`80.
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`This contravenes 43 C.F.R. § 3162.3-1(d)(2), which requires a Surface Use Plan
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`of Operations to be submitted for BLM approval with every APD.
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`81.
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`It also contravenes 43 C.F.R. § 3163.1, which requires BLM to take enforcement
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`action for noncompliance with any portion of an approved APD.
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`iii.
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`Reclamation
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`82.
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`PIM 2018-014 asserts that “[a]ctual reclamation of the surface” of Fee/Fee/Fed
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`wells “is a matter to be settled by the surface owner” and, more broadly, claims that BLM
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`jurisdiction over surface disturbance on non-Federal lands extends “solely to the extent of
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`assuring production accountability for royalties.”
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`83.
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`This contravenes BLM regulations, which explicitly require that “the surface of
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`the lands disturbed in connection with the conduct of operations shall be reclaimed in accordance
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`with a plan first approved or prescribed by” BLM. 43 C.F.R. § 3162.3-4 (underscore added); see
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`also id. § 3162.5-1(b) (the operator must “reclaim the disturbed surface” upon the conclusion of
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`operations); 30 U.S.C. § 226(g) (requiring bond sufficient to ensure “restoration of any lands or
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`surface waters adversely affected by lease operations”) (underscore added).
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`COMPLAINT - 16
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`Case 1:22-cv-02168 Document 1 Filed 07/22/22 Page 17 of 22
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`84.
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`This requirement is not limited to surface disturbance on federal lands or the
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`leasehold itself, as are other sections of this same subchapter. See, e.g., 43 C.F.R. § 3163.1; id. §
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`3162.3-3; id. § 3104.1(a).
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`iv.
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`Bonding
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`85.
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`PIM 2018-014 claims that “bonds for Fee/Fee/Fed wells should be used to address
`
`downhole concerns only” and that “BLM does not have authority to require a bond to protect
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`non-Federal surface owner interests.”
`
`86.
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`This contravenes BLM’s statutory duty under the MLA to collect a bond
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`sufficient to ensure “reclamation of the lease tract, and the restoration of any lands or surface
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`waters adversely affected by lease operations.” 30 U.S.C. § 226(g) (underscore added); see also
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`43 C.F.R § 3104.1(a). Onshore Order 1 confirms that BLM, in determining the bond amount,
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`“may consider impacts of activities on . . . non-Federal lands required to develop the lease that
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`impact lands, waters, and other resources off the lease[.]” 72 Fed. Reg. at 10,333 (underscore
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`added).
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`D.
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`87.
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`PIM 2018-014 CONFLICTS WITH PAST AND CURRENT AGENCY
`PRACTICE AND POLICY.
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`The argument that BLM lacks the statutory authority to regulate surface
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`operations associated with Fee/Fee/Fed wells also contradicts past and current agency practice
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`and policy.
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`88.
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`On information and belief, BLM has attached mandatory conditions of approval
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`pertaining to surface operations on past Fee/Fee/Fed well approvals. PIM 2018-014 does not
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`acknowledge this prior practice or explain the reason for BLM’s policy shift.
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`89.
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`PIM 2018-014 is also irreconcilable with BLM’s current policy as to split estate
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`wells, which are those drilled from private surface directly into underlying federal minerals.
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`COMPLAINT - 17
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`Case 1:22-cv-02168 Document 1 Filed 07/22/22 Page 18 of 22
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`BLM has long asserted authority to regulate surface operations associated with split-estate wells,
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`even though they are located on private land, and generally subjects split-estate wells to the same
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`restrictions as those on federal land.
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`90.
`
`BLM has never explained how the MLA, MLAAL, and FLPMA can possibly be
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`read to authorize the regulation of surface operations on private lands for split-estate wells but
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`not Fee/Fee/Fed wells. In the split-estate context, common law considers the mineral estate to be
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`“dominant” and gives the mineral owner the right to use so much of the surface as is reasonably
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`necessary for development of the underlying minerals. In contrast, a Fee/Fee/Fed developer must
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`enter into a private surface use agreement with the landowner to develop offsite minerals.
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`However, that property law distinction does not depriv