Monday, December 9, 2019

Shale Law Weekly Review - December 9, 2019

Written by:
Chloe Marie – Research Specialist
Jackie Schweichler – Staff Attorney
The following information is an update of recent local, state, national and international legal developments relevant to shale gas.
LNG Exports: FERC Approved Four LNG Projects in Texas
On November 21, 2019, the Federal Energy Regulatory Commission (FERC) approved construction of four liquefied natural gas (LNG) projects and their associated facilities in Texas.  These projects include the Texas LNG Brownsville Project, a project involving the construction and operation of new LNG export facilities along the Brownsville Ship Channel in Cameron County, with an export capacity of approximately 4 million metric tonnes per annum (MMtpa).  Two of the new LNG facilities will be the Rio Grande Terminal Project and the Annova LNG Brownsville Project, both located in the Port of Brownsville.  These facilities would have a capacity to export up to 27 MMtpa and 6 MMtpa, respectively.  The fourth project, the Stage 3 LNG Project, would expand the existing Corpus Christi Liquefaction’s LNG terminal by increasing the export capacity by an additional 11.45 MMtpa. 

Municipal Regulation: City of Broomfield, Colorado, Extends Temporary Moratorium on Oil and Gas Development Applications
On December 3, 2019, the Broomfield City Council passed Ordinance No. 2111 to approve a 6-month extension of a prior moratorium on processing or approving oil and gas development applications within the city and county of Broomfield.  The prior moratorium had been set to expire on December 4, 2019, and will now be in place until June 4, 2020. The council had previously directed its staff to prepare draft oil and gas regulations following the enactment of SB 19-181; however, it needed additional time to complete research and prepare related regulations.

Methane Emissions: Pipeline Companies File Legal Actions Against Texas Railroad Commission over Flaring Permits
On November 20, 2019, Williams MLP Operating, LLC and Mockingbird Midstream Gas Services, LLC petitioned the 345th Civil District Court in Travis County for a judicial review of an order granting a flaring exception to EXCO Operating Company, LP.  The plaintiffs are owners and operators of the Eagle Ford Gathering System that transports gas for the EXCO wells at issue.  EXCO requested an exception to the no-flaring rule for more than 130 wells in the Eagle Ford Shale Field.  The request was granted by the Railroad Commission of Texas in August 2019 pursuant to Statewide Rule 32.  Under Rule 32, operators are required to obtain a permit to flare gas from oil wells; however, plaintiffs argued that EXCO had no need to flare gas in this context because the company was already connected to a gathering system.  The plaintiffs also pointed out that for the period from 2013 through 2019, the Commission granted no less than 35,000 flaring permits.

Climate Change: Federal Judge Denies Exxon Motion to Remove Climate Change Lawsuit from State to Federal Court
On December 6, 2019, the U.S. District Court for the District of Massachusetts denied Exxon Mobil Corporation’s motion to remove the case from the Superior Court of Suffolk County, Massachusetts to federal court (Massachusetts v. Exxon Mobil Corp., No. 1:19-cv-12430). Massachusetts Attorney General Maura Healey filed this case in October 2019 alleging that Exxon violated the state’s Consumer Protection Act by deceiving investors and consumers about the consequences of climate change.  Exxon described this lawsuit as a “culmination of a multi-year plan concocted by Plaintiffs’ attorneys, climate activists, and special interests to force a political and regulatory agenda that has not otherwise materialized through the legislative process.”  Exxon argued that this lawsuit involves questions of federal law not state law and thus filed a request on November 29, 2019, before the federal court to remove the case from state court. 

Production and Operation: EIA Reports that U.S. is Net Petroleum Exporter for the First Time in 50 Years
On December 5, 2019, the U.S. Energy Information Administration (EIA) reported that in September 2019, and for the first time in nearly 50 years, the United States exported more petroleum than it imported.  This development is partially due to crude oil production more than doubling in the past decade. Specifically, crude oil production increased from 5.3 million b/d in 2009 to 12.1 million b/d through September 2019.  The change is also the result of decreasing crude oil imports from outside countries as well as the 2015 lifting of federal restrictions on oil exports.  The U.S. EIA, however, pointed out that the country is still a net importer of crude oil that comes mainly from Canada and Mexico.

Pipelines: Chester County District Attorney’s Office Files Suit Against Energy Transfer for Bribery and Conspiracy over Mariner East Pipeline
On December 3, 2019, Chester County District Attorney Tom Hogan announced in a press release that his office instituted criminal proceedings against Energy Transfer for bribery, conspiracy, and other related offences.  District Attorney Hogan alleged that Energy Transfer unlawfully hired armed Pennsylvania constables to act as private agents for the protection of the Marine East Pipeline in lieu of private security firms.  He argued that these constables were outside their jurisdictions and illegally used their badges and positions to intimidate the local population.  In addition, Hogan claimed that Energy Transfer developed an illicit scheme to conceal payments made to the constables, which would also hide the company’s fraudulent involvement.  All those implicated have been arrested and now await the hearing.  According to Energy Transfer, the allegations have no merit as the constables were legally hired through an “independent, Pennsylvania-based security firm.”

GHG Emissions: Spanish Company Repsol Makes a Step Towards Reducing GHG Emissions to Meet the Paris Climate Agreement Requirements
On December 2, 2019, Spanish Energy Company Repsol announced its aim to become a carbon neutral company by 2050.  According to their announcement, the company is the first oil and gas company to entertain a zero emissions objective.  Repsol is committed to producing a business plan that sets out steps towards limiting increases in global temperature to below 2 degrees Celsius in line with the Paris Climate Agreement.  In this respect, and among others, the company developed a low-carbon transition plan with the aim of increasing electricity generation capacity up to 7,5000 MW by 2025 from renewable energy sources.  In addition, the company has implemented a new oil and gas price scenario, including reevaluating some financial assets, with an after-tax accounting charge of about 4.8 billion euros. 

From the National Oil & Gas Law Experts:
Charles Sartain, The Duhig Rule Explained and Distinguished (Dec. 5, 2019)
John McFarland, The Economics of Flaring (Dec. 2, 2019)
John McFarland, Fight Over Flaring in the Eagle Ford (Nov. 25, 2019)
U.S. Energy Information Administration, Natural gas venting and flaring increased in North Dakota and Texas in 2018 (Dec. 6, 2019)
National Legislation
Engineers Corps
Environmental Protection Agency
Pennsylvania Actions and Notices
Department of Conservation and Natural Resource
Department of Environmental Protection
Connect with us on Facebook! Every week we will post the CASL Ledger which details all our publications and activities from the week.
Want to get updates, but prefer to listen? Check out the Shale Law Podcast! We can always be found on our Libsyn page, iTunes, Spotify, or Stitcher.
Check out the November Agricultural Law Brief! Each month we compile the most significant legal developments in agriculture. If you’d like to receive this update via email, check out our website and subscribe!

Monday, December 2, 2019

Shale Law Weekly Review - December 2, 2019

Written by:
Chloe Marie – Research Specialist
Jackie Schweichler – Staff Attorney
The following information is an update of recent local, state, national and international legal developments relevant to shale gas.
Public Lands: BLM Publishes Draft Environmental Impact Statement for National Petroleum Reserve in Alaska
On November 25, 2019, the Bureau of Land Management (BLM) published notice of availability of a draft environmental impact statement (EIS) for the National Petroleum Reserve (NPR-A) in Alaska. The NPR-A is located on Alaska’s North Slope region and includes 23 million acres.  The draft EIS includes four management options with analysis on oil and gas exploration, development, and transportation.  One option would include maintaining the current oil and gas leasing acreage of 11.8 million acres.  Another option would decrease the amount of land leasing availability to 11.4 million acres. The other two options would increase the leasing acreage to 17.1 or 18.3 million.  The public comment period will close January 21, 2020. 

Municipal Regulation:  California Restaurants File Lawsuit Against Berkeley for Natural Gas Infrastructure Ban
On November 21, 2019, the California Restaurant Association (CRA) filed a complaint in the U.S. District Court for the Northern District of California against the City of Berkeley to oppose the city’s recently passed natural gas infrastructure ban (California Restaurant Association v. City of Berkeley, 3:19-cv-07668-SK).  The new law, Prohibition of Natural Gas Infrastructure in New Buildings, was passed in July 2019 and will go into effect on January 1, 2020.  The law prohibits the installation of natural gas infrastructure in new building construction, with limited exceptions.   According to the city, substituting electric for gas appliances will address the problem of climate change and improve air quality in homes.  CRA argues, however, that the law negatively affects restaurants and chefs who need flames in order to create a variety of culinary dishes.  CRA states that restaurant owners may be dissuaded from moving, upgrading their buildings, or opening new restaurants. 

Methane Emissions: States and Senators Submit Comments on Proposed Emission Standards Rule
On November 22, 2019, several states submitted comments on the proposed rule, Oil and Natural Gas Sector: Emission Standards for New, Reconstructed, and Modified Sources Review.  The stated purpose of the proposed rule is to amend new source performance standards (NSPS) to remove “regulatory duplication” while maintaining current emission sources protections.  According to the states’ comments, the proposed rule is arbitrary and capricious in failing to consider the impact of the rule on existing oil and natural gas industry sources.  In addition, the states assert that the proposed rule violates the Clean Air Act and would increase methane emissions.  Similarly, on November 25, 2019, Senators Whitehouse, Duckworth, Van Hollen, and Merkley submitted comments on the proposed rule.  The senators also argue that the rule is arbitrary and capricious and would serve to create higher methane emissions. 

Production and Operation: Cleveland State University Provides an Analysis on Investment in the Ohio Oil and Gas Sector for Q3 and Q4 of 2018
On November 12, 2019, the Energy Policy Center at Cleveland State University published a report about Utica shale-related investment in Ohio for the period from July 1 to December 31, 2018. The report provides essential data and separate analysis on investment made for the three major oil and gas sectors: upstream, midstream and downstream. According to the report, there has been a 25% decrease in upstream investment with fewer wells drilled compared to the first quarter of the year 2018; however, data shows that production is still increasing. Despite very little investment made in the midstream and downstream sectors, the report indicated some increased activity and new pipeline or power generation plant projects that will be included in future 2019 reports. Overall, total investment from the third to fourth quarter of 2018 represents $3.8 billion. 
From the National Oil & Gas Law Experts:
Georges A. Bibikos, At the Well Weekly (Nov. 22, 2019)
U.S. Energy Information Administration, U.S. energy-related CO2 emissions rose in 2018 for the first year since 2014 (Nov. 26, 2019)
U.S. Energy Information Administration, U.S. average gasoline prices this week are similar to the previous two Thanksgivings (Nov. 27, 2019)
National Regulatory Actions:
Federal Energy Regulatory Commission
Environmental Protection Agency
Pennsylvania Legislation:
Senate Bill 967: this bill would mandate all major facilities to establish and maintain a municipal notification plan in order to alert the public in case of an air pollution incident (Referred to Environmental Resources and Energy; Nov. 25, 2019)
Pennsylvania Actions and Notices:
Department of Environmental Protection
Connect with us on Facebook! Every week we will post the CASL Ledger which details all our publications and activities from the week.
Want to get updates, but prefer to listen? Check out the Shale Law Podcast! We can always be found on our Libsyn page, iTunes, Spotify, or Stitcher.
Check out the November Agricultural Law Brief! Each month we compile the most significant legal developments in agriculture. If you’d like to receive this update via email, check out our website and subscribe!

Monday, November 25, 2019

Shale Law Weekly Review - November 25, 2019

Written by:
Chloe Marie – Research Specialist
Jackie Schweichler – Staff Attorney
The following information is an update of recent local, state, national and international legal developments relevant to shale gas.
Municipal Regulation: Town of Brookline, Massachusetts Prohibits New Fossil Fuel Infrastructure for Building Construction
On November 21, 2019, the Town of Brookline, Massachusetts, adopted Article 21 amending the Town General By-Laws and prohibiting the use of fossil fuel infrastructure meant for major renovation or new building projects.  It is specified in Article 21 that such prohibition applies only to renovation in which more than 50% of the surface of the building undergoes renovation. Article 21 provides for some exceptions, including fuel for backup generators and portable propane.  According to the explanation published on the town’s website, this ban aims to protect citizens from potential fuel leaks that could result in an explosion and air pollution.  In addition, the change is meant to reduce carbon emissions in order to meet the goals set forth in its Climate Action Plan. 

Infrastructure: Wisconsin Governor Signs Bill Establishing Trespass of Energy Critical Infrastructure as a Criminal Offense
On November 20, 2019, Governor Tony Evers of Wisconsin signed into law Assembly Bill 426, now known as Act 33, creating a new criminal offense for trespassing onto the property of an energy provider.  Act 33 defines “energy provider property” as “property that is part of an electric, natural gas, oil, petroleum, refined petroleum product, renewable fuel, water, or chemical generation, transmission, or distribution system and that is owned, leased, or operated by an energy provider.”  Anyone who unlawfully enters an energy provider property can be convicted of a Class H felony, and the offender may face imprisonment of up to six years and/or a fine of up to $10,000. 

LNG Exports: FERC Issues Final Environmental Impact Statement for Jordan Cove LNG Project
On November 15, 2019, the Federal Energy Regulatory Commission (FERC) issued the Final Environmental Impact Statement (FEIS) for the proposed Jordan Cove LNG project located across the North Spit of Coos Bay in Oregon.  The project entails the construction of five liquefaction trains, each with a capacity to export up to 1.5 million tonnes per annum (Mtpa) of liquefied natural gas and will operate through a federally owned 7-mile channel.  FERC concluded that this project would create adverse consequences to the environment, but that they could be avoided or minimized if properly addressed. 

GHG Emissions: UN Environment Program Publishes Report Assessing Global Community Strategy to Limit Fossil Fuel Production
The United Nations Environment Program, together with five other European and International partners, recently published the Production Gap Report as part of their overall evaluation of the international community’s effort to tackle climate change.  The report found that different strategies implemented by governments to reduce fossil fuel use is not in line with fossil fuel production targets set in the Paris Climate Agreement.  In order to meet those goals, the report encourages governments to adopt “supply-side” policies instead of “demand-side” measures as their best option to restrict growth in fossil fuel production. 

Induced Seismicity: New Study Establishes a Link Between Hydraulic Fracturing and Seismic Activity in the Eagle Ford Shale Play
On November 13, 2019, Geophysical Research Letters published a new study suggesting that there is a direct correlation between hydraulic fracturing operations in the Eagle Ford Shale Play and an increase of seismic activity in that region from 2014 to 2018.  According to the study, during that time frame, approximately 90 earthquakes with a magnitude of 2.0, or greater, were the result of hydraulic fracturing activities.  The researchers suggest that the probability of induced seismicity from hydraulic fracturing is most closely related to factors including “proximity to faults, orientation of faults in the stress field, effective injection rate, injected volume and number of laterals on a well pad.”  The study is entitled “Hydraulic Fracture Injection Strategy Influences the Probability of Earthquakes in the Eagle Ford Shale Play of South Texas.”
From the National Oil & Gas Law Experts:
John McFarland, Two Fun Resources (Nov. 14, 2019)
National Legislation
Environmental Protection Agency
Pennsylvania Legislation
House Bill 476: this bill would require DEP to forward notices of noncompliance issued by EPA for violation of the Toxic Substances Control Act (TSCA) or Solid Waste Management Act (SWMA) to the municipality where the violation occurred (First consideration; Nov. 19, 2019)
Senate Bill 950: this bill would authorize DEP to conduct a public comment process on and submit to the General Assembly a measure or action intended to abate, control or limit carbon dioxide emissions by imposing a revenue-generating tax or fee on carbon dioxide emissions.
Senate Bill 694: this bill would allow well bores to cross multiple units (Signed by Governor; Nov. 7, 2019)
Pennsylvania Actions and Notices
Department of Environmental Protection
Connect with us on Facebook! Every week we will post the CASL Ledger which details all our publications and activities from the week.
Want to get updates, but prefer to listen? Check out the Shale Law Podcast! We can always be found on our Libsyn page, iTunes, Spotify, or Stitcher.
Check out the October Agricultural Law Brief! Each month we compile the most significant legal developments in agriculture. If you’d like to receive this update via email, check out our website and subscribe!

Friday, November 22, 2019

Shale Law Weekly Review - November 19, 2019

Written by:
Jackie Schweichler – Staff Attorney
The following information is an update of recent local, state, national and international legal developments relevant to shale gas.
State Regulation: Pennsylvania Governor Signs Bill Allowing Horizontal Cross Unit Drilling
On November 7, 2019, Pennsylvania Governor Tom Wolf signed a new law which amends the Oil and Gas Lease Act and authorizes operators to drill horizontally across multiple units.  This law would apply only where the operator has a lease with the landowner of each tract, and the operator is required to allocate production among the various landowners.  The new law does not allow drilling where the lease terms specifically prohibit cross unit drilling.  This law will be codified as section 2.2 of the Oil and Gas Lease Act.  Previously, in 2013, the Oil and Gas Lease Act was amended to add section 2.1, which effectively allows operators to act as if they have pooled together several tracts, even when those leases have no pooling clause.

Production and Operation: EIA Releases Reports Estimating Natural Gas Production in the United States
On November 13, 2019, the U.S. Energy Information Administration (EIA) released the November Short-Term Energy Outlook.  The report estimates that dry natural gas production in the United States will increase 10% from 2018 levels to reach 92.1 billion cubic feet per day in 2019.  Liquefied natural gas (LNG) exports are also expected to increase in 2019 to average 4.7 Bcf/d and to reach 6.4 Bcf/d in 2020.  In addition, EIA released an analysis of their Heating Oil and Propane Update, published on November 14, 2019.  EIA states that heating oil prices are expected to be 10% lower and propane prices 22% lower for the 2019/2020 winter heating season.

Pipelines: Public Hearing Held in North Dakota to Discuss Dakota Access Pipeline Expansion
On November 13, 2019, the North Dakota Public Service Commission held a public hearing to allow members of the public to comment on plans to increase pipeline capacity for the Dakota Access Pipeline project.  The hearing was held in Linton and live-streamed through the Commission’s website.  Prior to the hearing, the Standing Rock Sioux Tribe released a pre-hearing brief.  According to the Tribe, expanding the pipeline capacity high velocity pumping would increase the likelihood and severity of negative repercussions.  According to Dakota Access, this project does not require mainline construction, and instead the company intends to add horsepower and upgrades to pump stations.

Pipelines: Michigan Attorney General Appeals Court Ruling Involving Enbridge Energy Line 5 Pipeline
On November 5, 2019, Michigan Attorney General Dana Nessel appealed the decision of the Michigan Court of Claims involving the Enbridge Energy Line 5 pipeline project.  In March, Michigan Governor Gretchen Whitmer ordered state agencies to cease implementation of Public Act 359.  The Act allows for the creation of a utility tunnel between the Upper and Lower Peninsulas of Michigan in the Straits of Mackinac.  The Governor based the decision on the Attorney General’s determination that the Act violated the state constitution’s Title Object Clause.  The Court of Claims decision, issued on October 31, 2019, found that the law was not unconstitutional.    
From the National Oil & Gas Law Experts:
Georges A. Bibikos, At the Well Weekly (Nov. 15, 2019)
Pennsylvania Actions and Notices
Department of Environmental Protection
Connect with us on Facebook! Every week we will post the CASL Ledger which details all our publications and activities from the week.
Want to get updates, but prefer to listen? Check out the Shale Law Podcast! We can always be found on our Libsyn page, iTunes, Spotify, or Stitcher.
Check out the October Agricultural Law Brief! Each month we compile the most significant legal developments in agriculture. If you’d like to receive this update via email, check out our website and subscribe!

- Updated: November 22, 2019