Opinion ID: 2829303
Heading Depth: 1
Heading Rank: 1

Heading: facts

Text: The Barnett Shale is a large, prolific oil and gas field lying beneath several counties, including Wise County, in northeast Texas. As in other shale formations, wells in the Barnett Shale require fracture stimulation in order to produce. Fracing a well entails pumping large volumes of water and sand into reservoir rock, which then mixes with saline formation water and must be flowed back out of the well before production can begin. A company fracing a well must dispose of the resulting waste. Most companies do so by injecting the waste into subsurface zones which are naturally saline environments, usually in old wells converted to injection wells. 1 A company seeking to convert a well to an injection well for oil and gas waste must apply to the Commission for a permit. Tex. Water Code § 27.031. In granting an injection well permit, the Commission is required to make the following findings: (1) that the use or installation of the injection well is in the public interest ; (2) that the use or installation of the injection well will not endanger or injure any oil, gas, or other mineral formation; (3) that , with proper safeguards, both ground and surface fresh water can be adequately protected from pollution; and (4) that the applicant has made a satisfactory showing of financial responsibility if required by Section 27.073. Id. § 27.051(b) (emphasis added). The instant dispute centers on the requisite public interest finding in section 27.051(b )( 1). Pioneer Exploration, Ltd. (Pioneer) applied to the Commission for a permit to convert an existing well into an injection well for the disposal of oil and gas waste. But several Wise County residents living near the well—respondents Texas Citizens for a Safe Future and Clean Water and James Popp (collectively, Texas Citizens)—opposed the proposed injection well, necessitating a contested administrative hearing before Commission hearing examiners. At the hearing, Texas Citizens voiced a variety of concerns about the well’s environmental soundness, but also presented arguments and evidence related to traffic-safety issues. Specifically, Texas Citizens argued that large trucks used to haul waste water to the well would damage nearby roads and pose a threat to area residents who use the roads, and thus would not serve the “public interest” under section 27.051(b )( 1). 2 Pioneer did not rebut this traffic-safety evidence. Instead, Pioneer essentially argued that the production of natural gas is in the public interest. The hearing examiners recommended issuing the permit. In the examiners’ findings of fact and conclusions of law, adopted by the Commission in its final order, the examiners found [u]se of the proposed disposal well is in the public interest because it will provide needed additional disposal capacity and an economical means of disposing of produced salt water from completed wells in the rapidly expanding Barnett Shale Field Area, thereby increasing ultimate recovery from these wells and preventing waste. The safe and proper disposal of produced saltwater serves the public interest. . . . The use of the proposed disposal well is in the public interest pursuant to Sec[ tion ] 27.051 of the Texas Water Code. In the proposal for decision, the examiners additionally concluded the “production of hydrocarbons for use by the people of Texas and industry serves the public interest.” In addressing Texas Citizens’ traffic-safety evidence, the examiners stated the Commission “does not have jurisdiction to regulate truck traffic on the state’s roads and highways.” The examiners concluded that, while they empathized with Texas Citizens’ concerns about property values and quality of life, Pioneer had met its burden of proof on the public interest finding. 3 The Commission adopted the examiners’ findings of fact and conclusions of law and approved Pioneer’s application. Texas Citizens appealed to the trial court, which affirmed the Commission’s order. The court of appeals, however, reversed, holding that the Commission abused its discretion in interpreting the “public interest” inquiry too narrowly by solely focusing on the proposed well’s effect on the conservation of natural resources. 4 See 254 S.W.3d 492, 503 . The court of appeals remanded the case to the Commission to “reconsider its public interest determination, using a broader definition of ‘the public interest,’ which includes public-safety concerns where evidence of such concerns has been presented.” Id. The Commission moved for rehearing en banc, which the court of appeals denied in a per curiam opinion with two justices writing separately, concurring in the denial. See id. at 503–07. The Commission and Pioneer petitioned this Court for review of the court of appeals’ holding on the “public interest” issue.