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Gasoline drips off a nozzle during refueling at a gas station in Altadena, California March 24, 2012. Picture taken March 24, 2012. REUTERS/Mario Anzuoni
By Rory Carroll

SAN FRANCISCO | Tue Apr 9, 2013 3:34am EDT

(Reuters) – A federal judge has ruled the Obama administration broke the law when it issued oil leases in central California without fully weighing the environmental impact of “fracking,” a setback for companies seeking to exploit the region’s enormous energy resources.

The decision, made public on Monday, effectively bars for the time being any drilling on two tracts of land comprising 2,500 acres leased for oil and gas development in 2011 by the Interior Department’s Bureau of Land Management in Monterey County.

The tracts lie atop a massive bed of sedimentary rock known as the Monterey Shale Formation, estimated by the Energy Department to contain more than 15 billion barrels of oil, equal to 64 percent of the total U.S. shale oil reserves.

Most of that oil is not economically retrievable except by hydraulic fracturing, or fracking, a production-boosting technique in which large amounts of water, sand and chemicals are injected into shale formations to force hydrocarbon fuels to the surface.

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