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Greens score win in first battle over California’s vast reserves of shale oil

California holds the US’s largest reserves of shale oil, but don’t expect a drilling boom any time soon.

A federal judge in California delivered a setback to the oil industry this week when he ruled that the US Bureau of Land Management (BLM) violated federal law by failing to consider the environmental impacts of hydraulic fracturing (fracking) before approving land leases to drill in the state’s Monterey Shale. The formation contains some 15 billion barrels, 64% of America’s shale oil reserves. Just days ago, southern California air quality regulators voted to require drillers to disclose fracking operations and the potentially toxic chemicals contained in the high-pressure fluids used break up rock formations that contain oil and natural gas.

The BLM had signed off on oil leases for 2,700 acres (1,093 hectares) of government-owned land in central California in June 2011. Environmental groups and local officials objected that the BLM rubber-stamped the leases without considering the potential for fracking to foul drinking water supplies, trigger earthquakes or imperil protected wildlife like the San Joaquin kit fox and the California condor.

In his decision released on April 8 the judge, Paul S. Grewal, agreed. “Even BLM itself has acknowledged that fracking activity in the United States has increased dramatically in recent years,” he wrote. “But rather than engaging in this reality by at least considering what impact might result from fracking on the leased lands, whatever its ultimate conclusion, BLM chose simply to ignore it.”

While Grewal called BLM’s actions “arbitrary and capricious,” he took pains to note that he was not ruling on “whether fracking in the Monterey Shale or anywhere else is a good thing or a bad thing.” Nonetheless, his ruling could have repercussions beyond California. The judge didn’t throw out the leases, as the green groups had requested. But the BLM must now conduct a new environmental review, which will be subject to further litigation and potentially a ruling by an appellate court whose decisions apply to nine western states.

“The ruling sets an important legal and policy precedent that federal and state agencies around the country would be wise to recognize,” said Brendan Cummings, an attorney with the Center for Biological Diversity, one of the groups that challenged the BLM decision, in an email to Quartz. “The BLM and other agencies cannot rely on outdated analyses and assumptions that ignore the unique risks to water, air and the public from fracking.”

The center, based in Tucson, Arizona, is known for its take-no-prisoners litigation on behalf of endangered wildlife. The group is also currently suing the California state agency that regulates oil and gas drilling, arguing that it has failed to adequately police fracking. And don’t underestimate the power of critters like the blunt-nosed leopard lizard to delay or derail projects. Just ask the solar industry—even clean green projects in California have faced fights over their impact on species such as the desert tortoise. “I think [the collision between fracking and wildlife] will be significant in parts of the state,” says Cummings.

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