Federal judge halts gas drilling plan on Colorado plateau

DENVER (Reuters) - A U.S. district judge ordered the U.S. Bureau of Land Management (BLM) on Friday to re-assess its plan to allow drilling on some 50,000 acres on the Roan Plateau, which the energy industry says contains one of the largest natural gas fields in the continental United States.

Judge Marcia Krieger said BLM had failed to thoroughly assess all the environmental impact to the ecologically sensitive plateau in western Colorado before approving energy development on the mountain.

"Like many areas of Colorado, the area has been blessed with an abundance of two major resources, the uses of which are often in conflict," Krieger wrote in her 38-page opinion.

"Its surface offers extensive and largely unspoiled ... scenic, ecological and wildlife virtues. Below the surface... contains valuable oil and gas reserves."

The BLM failed to consider alternative plans, or fully address air-quality issues and the potential impact from ozone emissions, Krieger wrote.

The ruling was a victory, if a temporary one, for environmental and conservations groups who sued to halt the project. The BLM gave the initial green light in 2007 for oil and natural gas development on the plateau near Rifle, Colorado, about 175 miles west of Denver.

The Colorado Oil & Gas Association says the plateau contains enough natural gas to power 4 million homes for 20 years.

Colorado's then-governor and members of the state's congressional delegation had asked the BLM to impose a moratorium on energy development on the 3,000-foot flat-top mountain. Drilling could foul a pristine watershed and uproot wildlife on the mountain, they said.

But the BLM moved ahead with the plan, saying it had addressed all environmental concerns by requiring directional drilling that would minimize surface wellheads, making some of the mountain off-limits for drilling and requiring well sites to be reclaimed before a new drill site is opened.

"(This is) an innovative approach to oil and gas development that protects fish and wildlife habitat, water resources and scenic views, while maximizing natural gas recovery," the BLM said at the time.

A coalition of environmental groups then sued the BLM, claiming the agency had violated its own protocol in approving development on public lands.

(Editing by Mary Slosson and Todd Eastham)