MRO » Topics » Montana Litigation

These excerpts taken from the MRO 10-K filed Feb 27, 2009.

Montana Litigation

In June 2006, we filed a complaint for declaratory judgment in Montana State District Court against the Montana Board of Environmental Review (“MBER”) and the Montana Department of Environmental Quality, seeking to set aside and declare invalid certain regulations of the MBER that single out the coal bed natural gas industry and a few streams in eastern Montana for excessively severe and unjustified restrictions for surface water discharges of produced water from coal bed methane operations. None of the streams affected by the regulations suffers impairment from coal bed natural gas discharges. The court, in deferring to the MBER’s discretion, upheld the MBER’s regulations. This decision was affirmed by the Montana Supreme Court; this decision in the meanwhile does not impact our operations due to pending litigation with U.S. EPA in Wyoming Federal District Court.

 

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Index to Financial Statements

Montana Litigation

In June 2006, we filed a complaint for declaratory judgment in Montana State District Court against the Montana Board of Environmental Review (“MBER”) and the Montana Department of Environmental Quality, seeking to set aside and declare invalid certain regulations of the MBER that single out the coal bed natural gas industry and a few streams in eastern Montana for excessively severe and unjustified restrictions for surface water discharges of produced water from coal bed methane operations. None of the streams affected by the regulations suffers impairment from coal bed natural gas discharges. The court, in deferring to the MBER’s discretion, upheld the MBER’s regulations. This decision was affirmed by the Montana Supreme Court; this decision in the meanwhile does not impact our operations due to pending litigation with U.S. EPA in Wyoming Federal District Court.

 

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Table of Contents
Index to Financial Statements
These excerpts taken from the MRO 10-K filed Feb 29, 2008.

Montana Litigation

In June 2006, Marathon filed a complaint for declaratory judgment in Montana State District Court against the Montana Board of Environmental Review (“MBER”) and the Montana Department of Environmental Quality,

 

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Table of Contents
Index to Financial Statements

seeking to set aside and declare invalid certain regulations of the MBER that single out the coal bed natural gas industry and a few streams in eastern Montana for excessively severe and unjustified restrictions for surface water discharges of produced water from coal bed methane operations. None of the streams affected by the regulations suffers impairment from coal bed natural gas discharges. The court, in deferring to the MBER’s discretion, upheld the MBER’s regulations. This decision is now being appealed to the Montana Supreme Court and does not impact Marathon operations in the meanwhile.

Montana Litigation

STYLE="margin-top:12px;margin-bottom:0px; text-indent:3%">In June 2006, Marathon filed a complaint for declaratory judgment in Montana State District Court against the Montana Board of Environmental Review
(“MBER”) and the Montana Department of Environmental Quality,

 


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Index to Financial Statements



seeking to set aside and declare invalid certain regulations of the MBER that single out the coal bed natural gas industry and a few streams in eastern
Montana for excessively severe and unjustified restrictions for surface water discharges of produced water from coal bed methane operations. None of the streams affected by the regulations suffers impairment from coal bed natural gas discharges. The
court, in deferring to the MBER’s discretion, upheld the MBER’s regulations. This decision is now being appealed to the Montana Supreme Court and does not impact Marathon operations in the meanwhile.

STYLE="margin-top:12px;margin-bottom:0px">Wyoming Proceedings

The Wyoming
Environmental Quality Council (“EQC”), which oversees the State Department of Environmental Quality (“DEQ”), has before it an administrative petition filed by the Powder River Basis Resource Council in 2006 seeking new water
quality sulfate and barium standards for coal bed methane produced water and a requirement that all such water be beneficially reused. The petition seeks to expand the authority of the DEQ to regulate the quantity of water discharges. It would
narrow the definition of required “beneficial use” discharges and would impose stricter effluent standards for discharged water. The EQC is also considering adoption of a rule which would impose more stringent water quality limits as to
produced water discharges that come from any new coal bed methane or conventional oil and gas operations. The DEQ made this proposal citing a statutory directive that all waters that are suitable for agriculture may not be degraded. Marathon
contends that its waters as currently regulated are beneficial to crops and livestock, rather than being a potential threat. The EQC would have to decide how stringent a water quality standard it would adopt for new discharges.

STYLE="margin-top:12px;margin-bottom:0px; text-indent:3%">In response to the Governor of Wyoming’s veto of a state agency adoption of a rule that would allow the DEQ to regulate the quantity of coal bed
methane water discharges, an activist group has sued in state court to overturn the veto. In June 2007, Marathon and another producer filed a motion to intervene. The DEQ has begun issuing renewal water discharge and other permits with stringent
limits based on its agricultural use policy rather than upon any regulation. The permits could require more costly water treatment or injection. Marathon is appealing every permit issued in this way. In 2007, the state court dismissed the activist
group’s lawsuit, and its time for appeal has expired.

This excerpt taken from the MRO 10-K filed Mar 1, 2007.

Montana Litigation

        In June 2006, Marathon filed a complaint for declaratory judgment in Montana State District Court against the Montana Board of Environmental Review ("MBER") and the Montana Department of Environmental Quality, seeking to set aside and declare invalid certain regulations of the MBER that single out the coal bed natural gas industry and a few streams in eastern Montana for excessively severe and unjustified restrictions for surface water discharges of produced water from coal bed methane operations. None of the streams affected by the regulations suffers impairment from coal bed natural gas discharges.

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