September 4, 2008

Michigan Energy Company Fights Drilling Ruling


Contact: William Perry Pendley of the Mountain States Legal Foundation, +1-303-292-2021

DENVER, Sept. 4 /PRNewswire-USNewswire/ -- A small Michigan energy company today sought to intervene in a lawsuit filed by environmental groups that resulted in a court ruling barring the company from drilling a well to identify new sources of energy. Savoy Energy, L.P. of Traverse City, Michigan filed its motion as well as a protective notice of appeal with a federal district court in Detroit. Savoy seeks to join in the case alongside the U.S. Department of Justice, which is defending the U.S. Forest Service and the Bureau of Land Management (BLM), to ensure that all factual and legal arguments that can be made to reverse the district court ruling will be made. The case involves a proposed exploratory well on federal lands to reach state and federal leases beneath state lands some 140 miles north of Lansing, Michigan. The appeal will be heard by the U.S. Court of Appeals for the Sixth Circuit in Ohio.

"After the groups won at the district court they stated, without irony, that they did not oppose drilling for energy; they only opposed drilling where Savoy proposed to drill," said William Perry Pendley of Mountain States Legal Foundation, which represents Savoy. "Of course, to find energy, America must drill where the experts believe the energy exists. Sadly, the district court badly misinterpreted the applicable law, hence Savoy's actions today."

Savoy Energy owns three federal and three state oil and gas leases, which comprise a 640-acre drilling unit in Crawford County, Michigan. In May 2003, Savoy filed a state drilling permit application with the Michigan Department of Environmental Quality (MDEQ), and submitted a drilling permit application (APD) with the BLM. Savoy planned to occupy surface lands in the Huron-Manistee National Forest, an area administered by the U.S. Forest Service and to drill directionally to a location under lands administered by the State of Michigan, in an area called the "Mason Tract."

The MDEQ requested more information from Savoy in response to public and agency concerns. In September 2003, Savoy submitted a new proposed well location and APD. In November 2003, the MDEQ approved the application. In August 2004, the Forest Service issued an Environmental Assessment (EA) and Biological Assessment. In January 2005, the Forest Supervisor issued a Decision Notice and a Finding of No Significant Impact (FONSI), which approved a modified version of Savoy's proposal.

On June 8, 2005, environmentalists sued. On December 7, 2005, the District Court issued a preliminary injunction. On June 20, 2006, a federal Magistrate concluded that the NEPA documents were inadequate. On July 10, 2008, the District Court ruled that the Forest Service had violated NEPA and, essentially, ordered the Forest Service to begin the NEPA process anew.

Mountain States Legal Foundation is a nonprofit, public interest law firm dedicated to individual liberty, the right to own and use property, limited and ethical government, and the free enterprise system. Its offices are in suburban Denver, Colorado.

SOURCE Mountain States Legal Foundation

(c) 2008 U.S. Newswire. Provided by ProQuest LLC. All rights Reserved.