US Judge Cancels Oil and Gas Leases on some Sage Grouse Land

A federal judge has cancelled more than $125 million in oil and gas leases on public lands that are home to the declining bird species greater sage grouse, in a ruling that said the Trump administration illegally curtailed public comment.

The ruling doesn’t prevent the administration from selling the leases at a later date. But opponents hope the delay can help them make the case that drilling should not be allowed in areas with sage grouse.

U.S. Magistrate Judge Ronald Bush’s order out of Boise, Idaho, covers leases issued by the federal Bureau of Land Management in 2018 on more than 1,300 square miles (3,400 square kilometers) in Nevada, Utah and Wyoming.

Wyoming Gov. Mark Gordon said millions of dollars that the state received from the sales already has been incorporated into its budget. He said the cancellation was “’unworkable” and urged the administration to challenge the order.

The case is part of a broader effort by environmentalists challenging the administration’s oil and gas leasing practices within the habitat of the ground-dwelling greater sage grouse.

The birds that range across 11 Western states have suffered sharp population declines in recent decades because of development, disease, drought and wildfires.

Future leases in greater sage-grouse habitat must allow a 30-day public comment and administrative protest period, Bush ordered. The Trump administration had reduced the protest period to just 10 days, which critics said gave them too little time to meaningfully react to proposed sales.

The ruling means any future sales on more than 100,000 square miles (270,000 square kilometers) of sage grouse habitat also would require the longer public comment period, said Talasi Brooks with the Western Watersheds Project, one of the groups that challenged the lease sales with a federal lawsuit.

“It’s a real win for public process and transparency in federal decision making,” Brooks said. “It could change the outcome potentially. The government could say after hearing public comment, ‘This is potentially important habitat.’ ”

The state of Wyoming, the oil industry and the federal government had argued against cancelling the leases outright because of the huge amount of money at stake. They wanted Bush to merely suspend them or say that no drilling could occur pending more public comment.

Cancelling the leases “would require BLM (Bureau of Land Management) to refund over $125 million worth of revenues to the purchasers,” attorneys for Wyoming and the Western Energy Alliance said in a joint court filing.

About half of lease sale proceeds are distributed to the states where the sales occur. That includes more than $44 million received by Wyoming, the attorneys said.

“The remedy issued by the Idaho judge is extreme, impractical and unworkable,” Gordon, a Republican, said in a statement.

Western Energy Alliance President Kathleen Sgamma said the shortening of the public comment period was a policy decision that should have been left to the administration — not a regulatory move that called for court intervention.

Bush said he had considered the “undeniably significant” economic effects of voiding the lease sales. But he said allowing the leases to stand would provide incentive for the government to approve potentially illegal projects out of the hope that they would be “too massive to unwind.”

BLM spokesman Derrick Henry said in response to the ruling that the agency supports “common-sense adjustments” to rules that govern leasing as a way to get rid of “burdensome regulations.” Agency officials did not respond to questions about how money from the lease sales could be recovered from the states.