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ANGELINA HOLLY CORP. v. CLARK

March 29, 1984

THE ANGELINA HOLLY CORPORATION, Plaintiff
v.
WILLIAM P. CLARK, SECRETARY OF THE INTERIOR, et al., Defendants



The opinion of the court was delivered by: GREEN

 This matter is before the Court on the parties' cross-motions for summary judgment. For the reasons stated below, the Court denies plaintiff's motion for summary judgment and grants defendants' motion for summary judgment.

 Statement of Facts

 The facts in this action are undisputed. At issue here is the defendants' rejection of plaintiff Angelina Holly Corporation's ("Angelina Holly") offers for certain noncompetitive oil and gas leases. As authorized by the Mineral Leasing Act of 1920 ("the Leasing Act"), 30 U.S.C. § 181 et seq., *fn1" the Secretary of Interior ("the Secretary") is charged with the duty of leasing certain Federal lands for oil and gas deposits. The leasing of these lands is done either on a competitive bidding basis within any "known geological structure of a producing oil and gas field . . .", *fn2" 30 U.S.C. § 226(b), or on a noncompetitive basis to the first qualified applicant where the lands are not within a known geological structure ("KGS"). 30 U.S.C. § 226(c).

 On February 22, 1980, Angelina Holly, a Texas corporation, filed with defendant, Bureau of Land Management of the United States Department of the Interior ("BLM"), New Mexico State Office, noncompetitive over-the-counter offers for oil and gas leases (numbered NM-A40368 TX, NM-A40369 TX, NM-A40370 TX, NM-A40371 TX, NM-A40372 TX, NM-A40373 TX, NM-A40374 TX, and NM-A40375 TX) on certain parcels of land in Giddings Field which are located in the Giddings/Somerville area of East Texas.

 On September 11, 1979, prior to plaintiff's filing of its noncompetitive over-the-counter offers, similar offers (numbered NM-48308 TX, NM-A38409 TX, NM-A38410 TX, NM-A38411 TX, and NM-A38413 TX) were filed by Mr. Charles E. Davidson on parcels of land also located in Giddings Field. Included in the parcels on which Mr. Davidson submitted offers were tracts 305, 306, and 307 in Segment 3. Included in Angelina Holly's offer NM-A40370 were tracts 301, 303, 304, 308, and 313, also in Segment 3, and contiguous to the tracts filed by Mr. Davidson. Mr. Davidson's tract 305 lies between and is contiguous to tracts 301, 303, and 304 for which plaintiff submitted offers. Mr. Davidson's tract 306 lies between and contiguous to tracts 308 and 313 for which plaintiff submitted offers. Also, tract 308 for which plaintiff submitted an offer lies between and is contiguous to Mr. Davidson's tracts 306 and 307.

 On December 1, 1980, Mr. Davidson was issued noncompetitive leases for the parcels of land, including tracts 305, 306, 307, and 330.

 On December 9, 1981, the Director of the Survey issued a memorandum extending the undefined KGS in the Giddings Field region into areas where plaintiff had submitted its noncompetitive offers for oil and gas leases. The Director determined that there was every reason to believe that the extended areas would be productive given the field studies and recent developments in oil production in the Giddings Field area.

 Based on the December 9, 1981 undefined KGS extension of Giddings Field, the BLM rejected Angelina Holly's noncompetitive lease offers on February 3, 1982. The BLM stated that "all the lands in the offers are within an extension to the undefined known geologic structure of the Giddings Field. . . . Therefore, these lands are available for leasing only [for competitive leasing] under 43 C.F.R. 3120." Exhibit D, Complaint.

 On February 22, 1982, pursuant to the applicable regulations, plaintiff gave notice of appeal from the BLM's decision rejecting the plaintiff's offers. Plaintiff timely filed its statement of reasons for the appeal with the Interior Board of Land Appeals ("IBLA") on March 8, 1982.

 Finally, on January 27, 1983, the IBLA affirmed BLM's decision to reject plaintiff's offers. Angelina Holly Corporation, 70 IBLA 294 (1983).

 The average time for processing noncompetitive over-the-counter oil and gas offers from September 1979 through February 1980 in the BLM's New Mexico State Office was approximately 19 months. The longest processing period for such an offer was 29 months, and the shortest period was 7 months. Affidavit of Jacqueline Morales, Oil and Gas Adjudicator, BLM, New Mexico State Office, Defendants' Motion for Summary Judgment. ("Morales Affidavit"). Mr. Davidson's offers were processed ...


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