UNITED STATES DISTRICT COURT 

FOR THE DISTRICT OF COLUMBIA 

BILL BARRETT CORPORATION, ) 

) 

Plaintiff, ) 

) 

v. ) 

) 

UNITED STATES DEPARTMENT ) 

OF THE INTERIOR, et al., ) 

) 

Defundanh, ) 

) 

and ) 

) 

BTU WESTERN RESOURCES, INC., ) 

) 

Intervenor-Defendant. ) 

Civil Case No. 09-19 (RJL) 

1"'-

MEMORANDUM OPINION 

(March II ,2009) 

Plaintiff Bill Barrett Corporation ("BBC") has filed suit under the 

Administrative Procedure Act ("APA") challenging the U.S. Bureau of Land 

Management's ("BLM") grant of a coal exploration license to BTU Western 

Resources, Inc. ("BTU"). BBC claims that the exploration license must be set 

aside because it lacks sufficient stipulations to protect BBC's rights to extract 

coalbed natural gas ("CBNG") under preexisting licenses should BBC's wells be 

contaminated by BTU's coal exploration drilling. Presently before the Court is 

BBC's motion for a preliminary injunction enjoining the government from 

allowing coal exploration under the license to proceed pending resolution of the 

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case on the merits.! Because BBC has failed to establish the requisite likelihood 

of irreparable harm to warrant a preliminary injunction, its motion is DENIED.2 

BACKGROUND 

Under the Federal Land Policy Management Act of 1976, it is the United 

States' policy that management of public lands "be on the basis of multiple use 

and sustained yield." 43 U.S.c. § 1701(a)(7). Consistent with that policy, BLM 

regulations provide that the grant of a permit or lease to develop anyone mineral 

on public land "shall not preclude" the issuance of other permits or leases for the 

development of other minerals on the same land, so long as there exist "suitable 

stipulations for simultaneous operation." 43 C.F.R. § 3000.7. One such form of 

multiple use - and the form at issue in this case - is the simultaneous extraction of 

both natural gas and coal from a resource-rich tract of public land. See id. § 

3400.1(b). 

BBC operates approximately 108 CBNG wells in the "Porcupine Field" in 

Wyoming's Powder River Basin pursuant to numerous federal oil and gas leases. 

(Mot. for Prelim. Inj. [Dkt. #3], Ex. A, Tracy Galloway Aff. ~ 2, Sept. 12,2008.) 

Neighboring BBC's CBNG operation is BTU's coal-mining operation, which 

Plaintiff also seeks identical relief under Section 705 of the AP A in the form of a 

postponement of the effective date of the exploratory license. 5 U.S.C. § 705. 

2 Plaintiff filed the instant motion on January 7,2009, seeking both a temporary 

restraining order and a preliminary injunction. ([Dkt. #3].) The Court held an 

abbreviated hearing later that day, after which the Court issued an order temporarily 

restraining and enjoining the defendants from allowing coal exploration operations under 

the license to proceed between that date and January 17,2009. (Minute Order, Jan. 7, 

2009.) The Court subsequently heard full oral argument on January 13,2009 on whether 

a preliminary injunction should issue upon the temporary restraining order's lapse. 

2 
extracts coal from the North Antelope Rochelle surface mine. In February 2007, 

BTU submitted an application to BLM for a federal coal exploration license to 

allow BTU to explore the coal reserves underlying the Porcupine Field and collect 

certain geologic data. (Defs.' Mem. In Opp. [Dkt. #5], Ex. A, Michael J. Karbs 

Decl. ~ 2, Jan. 6, 2009.) Such exploration entails drilling numerous small core 

holes into the field's coal bed and is a necessary precursor to a competitive bid 

process for a coal lease, as the data collected enables BLM to meet its 

responsibility to ensure that the public receives fair market value for the coal. 3 

(Karbs Decl. ~~ 5-6); 43 C.F.R. § 3422.1(c)(l). BTU sought the exploration 

license in order to advance its effort to secure a coal lease. 

BBC, while ostensibly not objecting to mUltiple use of the Porcupine Field, 

claims that exploratory drilling will irreparably harm its CBNG operation. BBC 

uses a vacuum technique to produce CBNG, employing two compressors that 

create negative pressure in the coal reservoir. (Galloway Aff. ~ 2.) The 

compressors are sensitive to the presence of oxygen in the gas stream, which can 

render the CBNG unmarketable. If either compressor detects oxygen exceeding 

10 parts per million for a period of ten minutes, the compressor will automatically 

shut down. (Jd.) To rectify such so-called "oxygen contamination," BBC must 

vent and flow all of the gas lines leading to the compressor, purging the CBNG in 

the lines to the atmosphere. (Jd. ~ 3.) This is a time consuming and costly 

3 In this instance, BLM asserts that it lacks adequate data for fair market valuation 

of approximately two and one half square miles of the Porcupine Field containing an 

estimated 169,000,000 tons of coal. (Karbs Decl. ~ 8.) 

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procedure, compounded by the loss of the purged CBNG's sale value. (Id.) BBC 

contends that due to the Porcupine Field's geologic makeup, specifically the 

permeability and porosity of the coal, exploratory drilling will cause oxygen 

contamination to occur. (Compi. [Dkt. #1] ~ 22; PI.'s Mem. In SUpp. at 1.) 

BBC contacted BLM in October 2007 to notify the agency of its concerns. 

BBC and BLM thereafter traded multiple letters over the next nine months as BBC 

provided BLM with additional technical information, at BLM's request. Upon 

consideration ofBBC's submissions and protests, BLM recognized that a risk of 

oxygen contamination existed, but concluded in a decision issued August 12, 2008 

that the risk was too uncertain to warrant denying BTU's application altogether. 

(Mot. for Prelim. Inj., Ex. B, BLM Decision at 2,6.) BLM instead crafted a 

phased drilling approach and stated its expectation that, pursuant to the standard 

simultaneous-use stipulations to be included in the license, BTU would be 

obligated to compensate BBC for any verified damage as a result of its exploratory 

drilling.4 (Id. at 5-6.) Not satisfied, BBC filed an appeal with the Interior Board 

of Land Appeals ("IBLA"), but the IBLA failed to act within the regulations' 

allotted time period, rendering BLM's decision on the license effective and final in 

late October 2008. 5 BLM formally issued BTU the coal exploration license on 

4 Under the phased drilling approach, BTU is authorized to drill the ten most 

important core holes for data collection purposes in a first round of drilling. (BLM 

Decision at 5-6.) If adverse effects on BBC occur, BTU can then waive or defer drilling 

the remaining 38 proposed core holes. (Id.) 

5 Under the relevant regulations, BBC's notice of appeal and petition for a stay 

automatically stayed the effectiveness of BLM' s decision pending the IBLA' s ruling. 43 

C.F.R. § 4.21(a)(l). IBLA's failure to act within 45 calendar days after the expiration of 

4 
December 30,2008, and BBC filed the present suit and motion for a preliminary 

injunction January 7, 2009. BBC's primary contention is that BLM's decision was 

arbitrary and capricious, an abuse of discretion, not in accordance with law, and in 

violation ofBBC's lease because the exploratory drilling will unreasonably 

interfere with BBC's CBNG operation and the license's stipulations do not 

adequately prevent such harm or compensate BBC for any damages incurred if 

oxygen contamination should occur.

6 (Pl.'s Mem. In SUpp. at 9-22.) 

DISCUSSION 

I. Legal Standard 

"A preliminary injunction is an extraordinary remedy that should be 

granted only when the party seeking the relief, by a clear showing, carries the 

burden of persuasion." Cobellv. Norton, 391 F.3d 251, 258 (D.C. Cir. 2004) 

(citing Mazurek v. Armstrong, 520 U.S. 968, 972 (1997)). As recently articulated 

by the Supreme Court, in order to obtain a preliminary injunction a movant must 

demonstrate: (1) that he is likely to succeed on the merits; (2) that he is likely to 

suffer irreparable harm in the absence of preliminary relief; (3) that the balance of 

equities tips in his favor; and (4) that an injunction is in the public interest. Winter 

the time for filing a notice of appeal, however, automatically rendered BLM's decision 

effective and final. Id. § 4.21(a)(3), (b)(4), (c). 

6 BBC's lease provides: "Lessor reserves the right ... to authorize future uses 

upon or in the leased lands, including the approval of easements or rights-of-way. Such 

uses shall be conditioned so as to prevent unnecessary or unreasonable interference with 

rights of lessee." (Defs.' Mem. In Opp'n, Ex. 4, Offer to Lease and Lease for Oil and 

Gas at 2, § 6.) BBC also contends that BLM violated the National Environmental Policy 

Act and that BLM acted in excess of statutory authority by issuing the license for the 

express purpose of endowing BTU with negotiating leverage to be used against BBC to 

reach a reasonable accommodation. CPl.'s Mem. In Supp. at 22-31.) 

5 
v. Natural Res. De! Counsel, 129 S. Ct. 365, 374 (2008); see also CityFed Fin. 

Corp. v. Office a/Thrift Supervision, 58 F.3d 738, 746 (D.C. Cir. 1985). While 

these factors interrelate on a sliding scale, CityFed Fin. Corp., 58 F.3d at 747, the 

movant must, at a minimum, "demonstrate that irreparable injury is likely in the 

absence of an injunction," Winter, 129 S. Ct. at 375 (citing Los Angeles v. Lyons, 

461 U.S. 95,103 (1983)) (emphasis in original). Indeed, because "the basis of 

injunctive relief in the federal courts has always been irreparable harm," a 

movant's failure to establish irreparable harm is grounds for denying a motion for 

preliminary injunction without considering the other factors. CityFed Fin. Corp., 

58 F.3d at 747 (citation omitted). For the following reasons, the Court finds that 

BBC's motion fails on this basis. 

II. Irreparable Harm 

Our Circuit has set a high standard to establish irreparable harm. 

Chaplaincy a/Full Gospel Churches v. England, 454 F.3d 290, 297 (D.C. Cir. 

2006). First, the injury "must be both certain and great; it must be actual and not 

theoretical." Id. (quoting Wis. Gas Co. v. FERC, 758 F.2d 669, 674 (D.C. Cir. 

1985) (per curiam)). The moving party must show "[t]he injury complained of is 

of such imminence that there is a 'clear and present' need for equitable relief to 

prevent irreparable harm." Id. Second, the asserted injury must be beyond 

remediation. As stated by the D.C. Circuit: 

Mere injuries, however substantial, in terms of money, time and 

energy necessarily expended in the absence of a stay[,] are not 

enough. The possibility that adequate compensatory or other 

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corrective reliefwill be available at a later date, in the ordinary 

course of litigation[,] weighs heavily against a claim of irreparable 

harm. 

Wis. Gas Co., 758 F.2d at 674 (quoting Va. Petroleum Jobbers Ass 'n v. FPC, 259 

F.2d 921, 925 (D.C. Cir. 1958)). Indeed, it is well-settled that monetary loss 

constitutes irreparable harm "only where the loss threatens the very existence of 

the movant's business." Id. 

To support its position that oxygen contamination is likely to occur, BBC 

points to three pieces of evidence: its experiences with oxygen contamination in 

connection with the clean-out of CBNG wells at the nearby Pronghorn Field, 

(Mot. for Prelim. Inj., Ex. A, Dec. 12,2007 Letter at 1-5); oxygen contamination 

that occurred as a result of the drilling of a water well in the vicinity of the 

Porcupine Field, (Jd., Apr. 1, 2008 Protest Letter at 19-21); and a three-page 

technical report prepared for BBC by petroleum engineer J. Craig Creel (the 

"Creel Report"), which analyzed the water well incident and concluded that "[i]f 

any of the ten proposed core holes are drilled, oxygen will be introduced into the 

producing coal seam reservoir and subsequently, into the BBC gas gathering 

system," (Jd., Minimum Safe Core Hole Drilling Distance Report at 3). BLM, 

however, determined that the Pronghorn Field evidence, while somewhat 

analogous, entailed significantly different field conditions. (BLM Decision at 2.) 

BLM similarly determined that the water well incident also entailed significantly 

different circumstances, including that the diameter of the water well was much 

bigger than the diameter of exploratory core holes, lending the evidence and the 

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Creel Report little predictive value. (BLM Decision at 3; Mot. for Prelim. Inj., Ex. 

A, BLM Review of J. Craig Creel Report at 1-4, July 22,2008.) Finally, BLM 

and BTU note that the State of Wyoming, in seeking leave to participate in BBC's 

IBLA appeal, stated that it was "unaware of any harm of the nature [BBC] asserts 

ever occurring in Wyoming," a conclusion consistent with BLM's understanding 

based on its own investigation. (Defs.' Mem. In Opp., Ex. 7, Wy. Mot. for Leave 

to File Amicus Br. ~ 1, Sept. 25, 2008; BLM Decision at 2-3.) 

The Court finds that the weight of the evidence is, at best, inconclusive as 

to whether oxygen contamination is likely to occur. While BBC's evidence 

establishes oxygen contamination is a possibility, BLM, in its expert judgment, 

determined, after evaluating BBC's evidence and inquiring into the experiences of 

similarly situated CBNG operators, that the risk of oxygen contamination "does 

not appear to be proven with any certainty." (BLM Decision at 2-3.) This Court, 

of course, must give due deference to BLM in matters within the agency's 

technical expertise, particularly where predictive judgments are at issue. See Am. 

Wildlands v. Kempthorne, 530 F.3d 991, 1000 (D.C. Cir. 2008) ("The rationale for 

deference is particularly strong when the [ agency] is evaluating scientific data 

within its technical expertise[.]" (citation omitted)); BNSF Ry. Co. v. Surface 

Transp. Bd., 526 F.3d 770, 781 (D.C. Cir. 2008) ("It is well established that an 

agency's predictive judgments about areas that are within the agency's field of 

discretion and expertise are entitled to particularly deferential review, so long as 

they are reasonable." (citation omitted)). Giving BLM that deference, this Court is 

8 
not persuaded that BLM's judgment was in error. Thus, in the absence of new 

evidence at this stage establishing that the harm BBC alleges is likely to occur, 

BBC has failed to establish the requisite risk of irreparable harm to warrant a 

preliminary injunction. 

Finally, it bears noting that BBC has also has failed to establish that 

the harm it contends will occur is of an irreparable nature. See Wis. Gas Co., 758 

F.2d at 674. BBC contends that oxygen contamination caused by exploratory 

drilling "will impose significant losses upon BBC, both in terms of costs of labor 

and the costs of lost and delayed production and associated revenues, and also in 

terms of the irrevocable loss ofCBNG natural resource that will have to be vented 

to the atmosphere before production can resume." (Pl.'s Mem. In Supp. at 33.) 

Assuming so, however, BBC has not established that the exploratory drilling will 

irreparably destroy BBC's ability to produce CBNG. Indeed, BBC has been able 

to return contaminated wells to production in just over nine days. (Mot. for 

Prelim. Inj., Ex. A, May 9, 2008 Letter at 3.) Moreover, BBC has not established 

that corrective or compensatory relief is otherwise unavailable. Despite BBC's 

attempt to shift the burden to the defendants, it is BBC's burden to establish, "by a 

clear showing," Cabell, 391 F.3d at 258, that no adequate remedy at law exists, 

Wis. Gas Co., 758 F.2d at 674. While BBC cannot pursue compensatory damages 

under the APA, 5 U.S.C. § 702, it may, as it itself has acknowledged, be able to 

pursue both a breach of contract claim and a takings claim against the United 

States for unreasonably interfering with BLM's existing leases, (Mot. for Prelim. 

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Inj., Ex A, Apr. 1,2008 Letter at 10 (citing Del Rio Drilling Programs, Inc. v. 

United States, 146 F.3d 1358 (Fed. Cir. 1998))). See also Amber Res. Co. v. 

United States, 538 F.3d 1358, 1378 (Fed. Cir. 2008) (affirming Court of Federal 

Claim's jurisdiction over contract-based claims arising from mineral leases). 

Accordingly, because the injury BBC asserts is of a monetary nature and because 

BBC has failed to establish by a clear showing that it has no other adequate 

remedy, BBC's motion for a preliminary injunction must be denied on this basis as 

well. 7 An appropriate Order will issue with this Memorandum Opinion. 

, 

Q~ RICHAR . LEON 

United States District Judge 

7 BBC's failure to establish irreparable hann is also fatal to BBC's request for relief 

under Section 705 of the AP A, which grants a reviewing court authority to postpone the 

effective date of an agency action "to the extent necessary to prevent irreparable injury." 

5 U.S.C. § 705. 

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