BARNSDALL, Okla.—The Osage Producers Association is going for broke in a lawsuit filed Wednesday against the Bureau of Indian Affairs. The trade organization contends that new oil and gas regulations issued by the BIA are not only “arbitrary and capricious” but unconstitutional.
OPA is also seeking a preliminary injunction to prevent the rules from going into effect on the scheduled start date of July 10, saying that any time spent under the new regulatory regime would cause “irreparable harm” to the county’s oil and gas producers.
In a lawsuit filed the same day, the Osage Minerals Council is asking the U.S. District Court to set aside the BIA’s new rules on similar grounds, though the Council omits the constitutional challenge.
Both the OPA and Minerals Council name the BIA and the Department of the Interior as defendants in their suits, which come as the latest salvo in a years-long battle over the future of the Osage mineral estate, a battle that has oil and gas producers caught in a crossfire between the Osage Nation and the BIA.
The new rules are the result of a long negotiated rulemaking process that was mandated as part of a 2011 settlement between the Osage Nation and the Department of the Interior that cost the federal government $380 million.
The OPA is leveraging a recent high profile Supreme Court case to make their point. In what must have been music to the producer’s ears, the nation’s highest court ruled in Michigan et. al v. Environmental Protection Agency that regulatory agencies could not ignore cost when drafting and promulgating regulations.
That case was decided in late June and makes no fewer than three appearances in the OPA’s motion for a preliminary injunction.