By Kennedy Maize
A federal judge in Montana this month (June 12) killed some 1.5 million acres of oil and gas leases on federal land in Wyoming that the Interior Department’s Bureau of Land Management (BLM) issued during the first Trump administration. The ruling also applied to some 185,000 acres of oil and gas leases in Montana and the Dakotas.
The Montana court ruling came a week after a highly touted BLM oil and gas lease sale in Alaska’s Arctic National Wildlife Refuge turned out to be a dud.
The Trump administration last October announced it would offer some 1.6 million coastal acres in Alaska’s 19-million-acre largely mountainous reserve for oil and gas exploration and production,. Interior Secretary Doug Burgum bragged, “By reopening the Coastal Plain and advancing key infrastructure, we are strengthening energy independence, creating jobs and supporting Alaska’s communities while driving economic growth across the state.”
BLM photo
The lease sale offered 58 tracts, but drew bids on only nine tracts totaling a bit more than 70,000 acres. There was no interest from major oil and gas producers. Only two bidders for a total of five tracts won, netting a paltry $3.7 million, divided equally between BLM and the state.
One of the two successful bidders was a state agency, the Alaska Industrial Development and Export Authority (AIDEA), with three tracts. The other successful bidder was HEX Energy LLC, a small Alaska-based oil and gas company. It won the other two tracts. Alaska Public Media reported, “All five tracts are on the westernmost part of the coastal plain, surrounding existing tracts AIDEA already leases.”
Larry Persily, former coordinator of a since-abandoned federal-state project to bring a natural gas pipeline from Alaska to the lower 48 states, told Alaska Public Media, ““Nothing against HEX and nothing against the employees at AIDEA but you’d have to look at this and say, ‘Well, this wasn’t much, was it?’”
Oil and gas exploitation on ANWR has been a focus of heated environmental and political disputes for over 40 years. It pitched environmental groups against development interests, dividing local indigenous communities. The Gwich’in tribe of Athabascan Indians in mountainous Canada at the Alaska border, opposed development, Inuit communities, such as the village of Kaktovik, located on the ANWR coastal plain supported oil and gas development. Those disputes now appear to have been oily tempests in a remote teapot.
In the Montana court case, the crux of the dispute was over BLM’s clash with the terms of the 1976 Federal Land Policy and Management Act (FLPMA) as the agency made several attempts to tiptoe around the habitat of the iconic and threatened Sage Grouse to prevent it from getting listed under the 1973 Endangered Species Act. That would have prevented the leasing. The case also involved interpretation of the 1920 Mineral Leasing Act. 
This month’s decision by Chief Judge Brian Morris of the U.S. District Court for the District of Montana was his third in the past half-decade over essentially the same territory and the same issues, the tricky interface between the Sage Grouse habitat and BLM’s intention to lease the birds’ grounds in order to reach the oil and gas underneath. The cases span the Obama, first Trump, Biden, and second Trump administrations.
In each case, Morris, a Democrat and Obama 2013 appointee to the Montana court, ruled that BLM erred in its attempts to pirouette around the Endangered Species Act while complying with FLPMA. In 2015, the Obama administration issued an order for BLM to stay entirely clear of the bird’s habitat while leasing under FLPMA. That order went unchallenged as the Obama administration’s term ended without a major lease sale.
In 2018, Trump’s BLM issued a new order substantially weakening the 2015 rule which told the agency to “prioritize” leases in areas that didn’t impinge on the critical habitat. The new Interior Department order, in Morris’s words, “directed BLM staff to disregard BLM’s 2015 Resource Management Plans.” BLM then held three large, successful lease sales in February, September, and December of 2019, and another in December, 2020.
When the Biden administration came to power, it essentially left the 2018 BLM guidance in place, which drew lawsuits from environmental groups, biological diversity defenders, and public lands advocates. Morris in 2022 ruled against BLM and the energy interests in two separate cases, which he dubbed “Phase One” and “Phase Two.”
Oil and gas interests in the second coming of Donald Trump and his Interior Department continued production in the leased land as they challenged the Phase Two ruling on technical legal grounds. The Ninth Circuit Court of Appeals in San Francisco had upheld Phase One.
In addition to what they claimed were legal procedural infirmities, Trump’s BLM and the industry argued that the passage of Trump’s 2025 One Big Beautiful Bill Act contained changes to the Mineral Leasing Act that required BLM to issue leases under any circumstances. In the meantime, production continued.
Leasing opponents filed suit, winning the Morris moniker of “Phase Three.” He again ruled that BLM had violated FLPMA in its leasing activities, ruling that “OBBBA fails to justify a different ruling on the merits in Phase Three.”
Morris’s order vacates the “Phase Three lease sales that violate FLPMA, excluding the nine producing leases” and the 2020 lease sales, where no final federal action has yet been taken.
The Quad Report, covering energy policy and politics.
