Ranchers Sue Texas Oil Regulators for Loosening Rules During Pandemic

(CN) — Two ranchers in the oilfields of South Texas sued the agency that regulates the state’s oil industry, claiming regulators acted illegally when they loosened rules on how quickly companies have to plug old wells as part of a broader effort to soften the pandemic’s financial toll on the industry.

The lawsuit filed Wednesday in Travis County District Court, which the ranchers brought alongside the advocacy group Public Citizen, claims the three elected members of the Texas Railroad Commission skirted the will of lawmakers and violated open meetings rules when they granted exceptions to various industry rules and fees at a meeting in early May.

More broadly, the plaintiffs accused the commission — which regulates fossil fuels, not railroads — of using the pandemic as an excuse to give oil companies a break.

“We find it shameful that they have taken advantage of the Covid-19 crisis to try to get an opportunity to avoid environmental restrictions,” Jennifer Riggs, an Austin-based attorney for the plaintiffs, said during a virtual press conference Thursday morning. The ranchers are both members of Public Citizen.

Abandoned oil and gas wells have frustrated environmental groups and landowners in Texas for years. When oil companies are finished with wells, they’re supposed to “plug” them to prevent leaks or spills, but some companies never get around to it or just go bankrupt when the industry crashes, leaving the problem to state regulators and taxpayers.

The U.S. is home to about 3.2 million abandoned oil and gas wells, while only about a third of those have been plugged, according to the latest figures from the Environmental Protection Agency. Methane leaks from abandoned wells accounted for about 1% of the nation’s overall methane emissions in 2018, according to the EPA.

In Texas, regulators have spent tens of millions of dollars plugging old wells in recent years, though by August 2019 there was still a backlog of more than 6,000 wells that the state needed to plug, according to an annual oilfield cleanup report. As of the end of June, the state had more than 10,700 unplugged wells in all, including those that companies are responsible for plugging themselves, according to the Railroad Commission.

Abandoned well numbers can fluctuate up and down alongside the industry’s fortunes. Because of the recent oil crash, the number of abandoned, unplugged wells across the state could grow at the same time that companies and regulators have less money on hand to deal with the problem.

Wednesday’s lawsuit specifically accuses the oil regulators of violating the Texas Open Meetings Act by failing to include a description of which specific rules they would consider suspending in a notice posted ahead of the May meeting.

Molly Rooke, a rancher in Refugio County and one of the plaintiffs in the case, said Thursday that she would have signed up to speak at the meeting if she had known that a proposal to give companies an extra year to start plugging abandoned wells was on the table. That measure was one of the various rule exceptions the regulators ultimately approved at the meeting.

A spokesperson for the Texas Railroad Commission declined to comment on the lawsuit, other than to say the actions taken at the meeting were “approved in accordance with the open meetings act, state and federal law, and commission rules.”

While the agency as an entity declined to say much, the chair of its elected three-member commission blasted the lawsuit and the plaintiffs who brought it.

“These legal, emergency actions protect the Texas Miracle while ensuring the environment is protected,” Wayne Christian said in a statement, referring to statewide economic growth. “This complaint is no more than a proxy for fringe extremists to advance their goal of eliminating the domestic production of fossil fuels, a move that would kill 3.2 million jobs, increase energy and gasoline costs by $2,500 a year for American families, and cost Texas $1.5 trillion in GDP between 2021-2025.”

The numbers Christian referenced come in part from a December analysis of a potential fracking ban published by the U.S. Chamber of Commerce, a pro-business lobbying group. The lawsuit filed Wednesday did not specifically mention anything about a fracking ban or eliminating fossil fuels.

Rooke, one of the South Texas ranchers, claimed in the lawsuit that the Railroad Commission has only committed to plugging 33 of the “dozens” of abandoned wells on her family’s La Rosa Ranch and that regulators only addressed her pleas for help about a toxic “blowout” at one oil well after the local newspaper covered the incident.

“Just because we have wells on our land does not mean that we don’t care about protecting the land, our water and our wildlife,” Rooke said. “We really want to be good stewards, but we need the help of the Railroad Commission to do their part to make sure that these unplugged wells are plugged and that they are cleaning up the areas that they are required to.”

The plaintiffs have asked the district court to block the commission’s emergency orders that loosened the various rules.

“We’re asking the court to tell them that they don’t get to suspend the law, only the legislature gets to suspend the law,” Riggs said.

Still, the attorney suggested that the plaintiffs would be open to settling the case if they could come to an agreement with the regulators about reinstating the rules.

“I don’t know if they will, I don’t anticipate they will, but it’s worth asking,” she said.

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