ReutersA worker checks valves at a natural gas appraisal well in China, which is embracing fracking as part of its energy production.
The Center for Biological Diversity and Sierra Club are suing the Bureau of Land Management to prevent gas drilling known as hydraulic fracturing, or fracking, on federal lands. The lawsuit contends that the bureau leased more than 2,500 acres in Monterey and Fresno counties to oil company representatives without doing a thorough analysis of the potential environmental impacts of fracking.
The leases were auctioned in September for $257,051 to Neil Ormond, an agent for Austin-based Vinton Exploration; LoneTree Energy & Associates, a Colorado-based broker for an undisclosed oil and gas exploration company; and Vintage Production California, LLC, a subsidiary of Occidental Petroleum.
In their Dec. 8 complaint [PDF], the plaintiffs argue that the auction violated the National Environmental Policy Act, which requires the bureau to do a thorough analysis of the environmental impacts of any oil or gas drilling on the land. The bureau's environmental assessment [PDF] found that there would be no significant impact.
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"They didn't do any real analysis of what fracking would mean out there," such as the potential effect on endangered species or the local water supply, despite the likelihood that fracking would be used, said Kassie Siegel, senior counsel for the Center for Biological Diversity and director of its Climate Law Institute.
"They cite some misleading, older information which says, well, fracking's no problem," she said.
The parcels contain watersheds for Monterey County, as well as habitat for threatened and endangered species, such as the kit fox and the blunt-nosed leopard lizard.
Fracking is a controversial process in which an unknown blend of chemicals and water is pumped at high pressure into the ground to create fissures for extracting oil or gas. A recently released Environmental Protection Agency draft report [PDF] found that fracking was likely the source of water contamination in Pavillion, Wyo. That water contained benzenes, alcohols and glycols.
Several EPA case studies of the Marcellus Shale in Pennsylvania also are investigating the tie between fracking and groundwater contamination. And according to a May study in the scientific journal Proceedings of the National Academy of Sciences, methane from the fracking process can leach into well water and pose a risk of explosion.
The California parcels sit on a geologic formation called Monterey Shale. The oil company Venoco estimates the site has a potential yield of more than 100 million barrels of oil, but requires hydraulic fracturing to extract it. Although the land has been leased for oil and gas drilling before, none of the land has been developed, and much of it is currently grazing land, said Erin Curtis, spokeswoman for the Bureau of Land Management.
The bureau wouldn't discuss the pending lawsuit. However, before any company drills a hole, "for each well, they have to submit an application for a permit to drill, and at that stage, we conduct an environmental assessment for each permit to drill," Curtis said.
Siegel doesn't find that reassuring. "BLM will probably tell you, 'Oh yeah, don't worry, there's no problem; if they really start putting a drill bit in the ground, we'll do further review before that happens.' I would say that it is entirely unclear what the BLM will do."
Right now, it's not clear which, if any, oil companies have plans to develop the land. About 40 acres were purchased by LoneTree Energy. "We're a broker; we buy leases for another company," said LoneTree representative Patti Koenig, who negotiates land purchases for oil companies. "We're not the operator, so there's nothing really that we can say."
Occidental Petroleum also can't disclose its plans for the 200 acres purchased, said Susie Geiger, external affairs liaison for Vintage Production California. Ormond, the broker for Vinton Exploration who purchased more than 2,300 acres of land, could not be reached for comment.
Often, these leases are resold to other companies, Siegel said, and sites often are leased by oil and gas exploration companies but never developed.
The lessees have 10 years to develop the land, after which it reverts back to the federal government if not developed. If the land is eventually developed, California and federal taxpayers will get royalties from the resources extracted, Curtis said.
The lawsuit on its own might not have the power to stop the Bureau of Land Management from leasing land for fracking, Siegel said. The National Environmental Policy Act "requires full disclosure, but it doesn't necessarily say you can't go forward with the activity if there is a risk," she said.