Monday, March 18, 2019

Shale Law Weekly Review - March 18, 2019


Written by:
Brennan Weintraub - Research Assistant
Jackie Schweichler - Staff Attorney

The following information is an update of recent local, state, national, and international legal developments relevant to shale gas.

Pipelines: FERC Approves Construction of Empire North Project
On March 7, 2019, the Federal Energy Regulatory Commission issued an order approving the construction of the proposed Empire North Project in New York and Pennsylvania. The project will involve the construction of two new compressor stations, one in each state, and is expected to increase the Empire Pipeline’s overall capacity by over 200,000 Dth/day of natural gas. The Project is expected to begin construction later this year and will be completed in September of 2020.

State Regulation: West Virginia Legislature Passes Natural Gas Utility Bill
On March 8, 2019, the West Virginia House of Representatives passed House Bill 2661, which seeks to incentivize utilities to provide natural gas to areas where dependable sources are not currently accessible. The bill would allow for gas utilities to petition the state Public Utility Commission for rate increases in areas where dependable, lower-priced sources of natural gas are not available. The bill would also prevent the abandonment of existing gas services unless present and future public convenience and necessity permits it.

Wildlife Habitat: Bureau of Land Management Announces Changes to Sage Grouse Protections
On March 15, 2019, the Bureau of Land Management announced that Records of Decisions were being issued to amend land-use restrictions related to sage grouse habitat in several Western states. The amended plans will continue to designate roughly 29 million acres of sagebrush steppe as priority habitat for the sage grouse.  The plans will also designate roughly 23 million acres as general habitat, which creates more flexible restrictions on land-use. These new plans will affect public land in Colorado, Idaho, Nevada and Northern California, Oregon, Utah, and Wyoming.

Pipelines: Delaware County District Attorney Announces Investigation of Mariner East Pipeline
On March 11, 2019, District Attorney Katayoun Copeland of Delaware County, Pennsylvania announced an investigation into allegations of criminal misconduct related to the construction of the Mariner East Pipeline. The Mariner East 2 Pipeline, the latest expansion of the pipeline, is expected to boost the system’s total capacity to roughly 345,000 barrels of natural gas per day. Due to the pipeline’s seventeen-county span across Pennsylvania, D.A. Copeland announced that the investigation will be conducted jointly with the Pennsylvania Attorney General’s Office.

International Development: Western Australia Temporarily Rescinds Greenhouse Gas Guidelines
On March 14, 2019, the Western Australia Environmental Protection Authority (EPA) announced that it would be withdrawing its newly-revised greenhouse gas guidelines following discussions with affected companies. EPA plans to engage in further discussions with industry members in order to ensure that the guidelines are able to be implemented practically and that companies will be able to anticipate the way in which the guidelines will be applied. The most significant concern of potentially-affected companies is the way in which offsets will be regulated under the new guidelines.

From the National Oil & Gas Law Experts:
Charles Sartain, Texas Supreme Court Clarifies Hyder, (March 12, 2019)

Pennsylvania Legislation:
HB 781: would allow counties the option to use impact fee funds for stormwater management (Referred to Environmental Resources and Energy - Mar. 11, 2019)

SR 33: would establish a commission to recommend safety, oversight, and coordination improvements for the transport of oil, gas, and other hazardous liquids (Referred to Consumer Protection and Professional Licensure - March 13, 2019)

HB 828:  would extend the term for well permits, allow for a single well permit to apply to multiple wells, and allow the final well location to be within 50 feet of the location specified on the permit (Referred to Environmental Resources and Energy - March 14, 2019)

HB 817: would have DEP establish a telephone hotline number for Pennsylvania residents to report suspected oil and gas violations (Referred to Environmental Resources and Energy - March 14, 2019)

HB 819:  would allow trained response teams to be in place for drilling and production operations (Referred to Labor and Industry - March 14, 2019)

Follow us on Twitter at PSU Ag & Shale Law (@AgShaleLaw) to receive ShaleLaw HotLinks:

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 the February Agricultural Law Brief! Each month we compile the biggest legal developments in agriculture. If you’d like to receive this update via email, check out our website and subscribe!

Tuesday, March 12, 2019

Shale Law Weekly Review - March 12, 2019


Written by:
Brennan Weintraub - Research Assistant
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: Colorado Senate Committee Advances Oil and Gas Safety Bill
On March 5, 2019, the Colorado Senate Transportation and Energy Committee voted 4-3 to favorably refer SB 181 to the Senate Finance Committee. The bill, entitled “Protect Public Welfare Oil and Gas Operations,” seeks to expand local government control over oil and gas operations, increase monitoring of methane emissions, and protect public health, safety, and welfare. Additionally, the bill would alter the composition of the Colorado Oil and Gas Conservation Commission by reducing the number of commissioners required to have experience in the oil and gas industry and increasing the number required to have experience in fields like wildlife protection, environmental protection, and public health.

International Development: Norwegian Government Approves Gradual Divestment of Oil and Gas Companies
On March 8, 2019, the Norwegian Ministry of Finance announced its proposal to begin the process of excluding oil and gas exploration and production companies from its Government Pension Fund Global. The goal of this divestment, the Ministry said, is to reduce the risk of changing oil prices on the national economy and to mitigate the impacts of climate change. At this time, the government is proposing divestment only from companies that are classified by FTSE Russell as exploration and production companies.  Companies that are more broadly classified remain eligible for inclusion in the fund.

Pipelines: South Dakota Legislature Passes Pipeline Protest Bill
On March 7, 2019, the South Dakota House of Representatives passed a bill establishing the PEACE (Pipeline Engagement Activity Coordination Expenses) fund, which would reimburse the state or localities within the state for expenses incurred due to opposition to pipeline construction. The fund would be comprised of an initial deposit made by all pipeline companies operating in the state and the levying of a special fee on the companies each month, based on the total approved claims from the previous month. The South Dakota Senate passed the same bill on March 4.

International Development: English High Court Finds for Environmental Group in Hydraulic Fracturing Suit
On March 6, 2019, English law firm Leigh Day announced that Justice Dove of the English High Court of Justice had issued his opinion in a case involving a challenge to the nation’s current hydraulic fracturing policy (Claire Stephenson v. Secretary of State for Housing and Communities and Local Government, CO/3511/2018). Specifically, Talk Fracking, an environmental advocacy group, alleged that the government had not sufficiently taken into consideration scientific evidence related to the climate effects of hydraulic fracturing. The court found that the government had not considered all relevant scientific evidence before forming its current policy and will now solicit suggestions from the parties as to what the government will be required to do.

Pipelines: TransCanada Receives Full Approval for Mountaineer XPress Pipeline  
On February 26, 2019, the Federal Energy Regulatory Commission (FERC) granted full approval to Columbia Gas Transmission, LLC (Columbia) to commence service on the Mountaineer XPress Pipeline (Docket No. CP16-357-000). Columbia, owned by TransCanada, requested approval for service on February 13, 2019.  The final approval will allow service for 30 miles of pipeline, four pig launchers/receivers, a regulating station, as well as other facilities.  According to TransCanada, the Mountaineer XPress Pipeline includes 170 miles of 36-inch diameter pipeline that is designed to transport 2.7 bcf/day of natural gas.

From the National Oil & Gas Law Experts:
George Bibikos, At the Well Weekly (March 8, 2019)


Pennsylvania Legislation:
HB 679: would require drilling operators to use tracers in hydraulic fracturing fluids (Referred to Environmental Resources and Energy - Mar. 1, 2019)

Follow us on Twitter at PSU Ag & Shale Law (@AgShaleLaw) to receive ShaleLaw HotLinks:

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 the February Agricultural Law Brief! Each month we compile the biggest legal developments in agriculture. If you’d like to receive this update via email, check out our website and subscribe!

Thursday, March 7, 2019

Shale Law in the Spotlight – Overview of Recent Oil and Gas Regulatory and Legal Developments in Colorado


Written by Chloe Marie – Research Specialist

Last November, national attention was focused on Colorado as voters considered, and ultimately rejected Proposition 112, which would have imposed rigorous set-back requirements upon oil and gas operations within the state. Since that time, while not getting as much attention as Proposition 112, a number of legal and regulatory developments have occurred within Colorado. These developments have attempted to address, or have been initiated due to concerns over, the impacts of oil and gas activities in the state. This article will provide a brief overview of some of these recent developments within Colorado. This article will not address Senate Bill 19-181, which was introduced into the Colorado Senate on March 1, 2019, and would make extensive changes to Colorado’s oil and gas regulations. If this bill advances through the legislative process, we will address its provisions in a future Shale Law in the Spotlight article.

The Colorado Supreme Court declines to impose further rulemaking responsibilities upon the Colorado Oil & Gas Conservation Commission (COGCC)

Colorado Oil & Gas Conservation Commission v. Martinez

In November 2013, some youth activists urged the Colorado Oil and Gas Conservation Commission (COGC) to promulgate a rule aimed at suspending the issuance of permits for activities using hydraulic fracturing. The activists requested that the Commission “not issue any permits for the drilling of a well for oil and gas unless the best available science demonstrates, and an independent, third party organization confirms, that drilling can occur in a manner that does not cumulatively, with other actions, impair Colorado’s atmosphere, water, wildlife, and land resources, does not adversely impact human health and does not contribute to climate change.”

After analysis, however, in May 2014, the Commission denied the request to engage in rulemaking, holding that it did not have the jurisdiction to enact some of the proposed rule, as this would mean that the Commission would have to “readjust the balance” between the development of oil and gas resources and protection of Colorado public health, safety, and welfare. According to the Commission, conducting such a rebalance would conflict with the language of the Colorado Oil and Gas Conservation Act. The Commission also noted that most of the concerns behind this proposed rulemaking are currently being addressed in cooperation with the Colorado Department of Health and Environment.

Petitioners challenged the Commission’s decision before the Denver District Court; however, the court upheld the Commission’s decision. The youth activists then appealed the District Court’s judgment to the Colorado Court of Appeals.

In a published opinion issued on March 23, 2017, the Court of Appeals agreed with the activists, holding that “the language of the [Oil and Gas Conservation] Act does not create a balancing test weighing safety and public health interests against development of oil and gas resources, but rather, the Act indicates that fostering balanced, nonwasteful development is in the public interest when that development is completed subject to the protection of public health, safety, and welfare, including protection of the environment and wildlife resources.” Therefore, the Court of Appeals reversed the lower court decision and remanded the case for further proceedings.

The Commission filed a Petition for Writ of Certiorari with the Colorado Supreme Court on May 18, 2017, seeking review of the Court of Appeal’s decision. On January 29, 2018, the Colorado Supreme Court agreed to consider whether the Commission properly interpreted the Act language as a ground for denying petitioners’ proposed rulemaking.

On January 14, 2019, the Colorado Supreme Court granted the Commission’s Petition for Writ of Certiorari and quashed the decision of the Colorado Court of Appeals agreeing that the Commission properly refused to initiate petitioners’ proposed rulemaking. In its opinion, the Supreme Court emphasized that the rulemaking authority of the Commission did not encompass a right to condition all new oil and gas development on a finding of no cumulative adverse impacts to public health and the environment. The court explained that “[r]ather, the [Act’s] provisions make clear that the Commission is required (1) to foster the development of oil and gas resources, protecting and enforcing the rights of owners and producers, and (2) in doing so, to prevent and mitigate significant adverse environmental impacts to the extent necessary to protect public health, safety, and welfare, but only after taking into consideration cost-effectiveness and technical feasibility.”

Quickly thereafter, the youth activists filed a motion on January 24, 2019, to vacate the Supreme Court’s order. On January 28, 2019, however, the Colorado Supreme Court denied their motion.

The town of Superior, Colorado, approves ordinance prohibiting any future oil and gas development project for a period of 6 months

On January 14, 2019, the town of Superior, Colorado, passed an ordinance placing a 6-month moratorium on future oil and gas exploration and production projects in the vicinity of the town. This ordinance followed after Highlands Natural Resources Plc – made a decision in November 2018 to withdraw all of its recent spacing and permit applications in relation to the company’s West Denver project for the drilling of wells under the Rocky Flats and Standley Lake.

The Rocky Flats is a former nuclear weapons production facility shut down in the 1980s due to concerns over radioactive contamination. The authorities declared the Rocky Flats to be a Superfund Cleanup Site in 1989 and proceeded to convert portions of the site into a National Wildlife Refuge.

In light of this proposal to drill under the Rocky Flats, residents of Superior expressed concerns over the potential for contamination of surrounding areas via plutonium, which has been previously buried within the former plant site. In addition, residents worried that such development would negatively impact nearby residential districts and impair the water quality of the Standley Lake, which represents a significant drinking water supply for Superior and surrounding towns.

As a result of these concerns, the Superior Board of Trustees considered whether local land use regulations relating to oil and gas activities were sufficient to protect the public health, safety and welfare of the town’s residents. In this regard, the Board of Trustees enacted an ordinance, the purpose of which was impose a moratorium to “maintain the status quo and to provide time for the Town Manager, Town Attorney and staff to study applicable law and regulations, a permitting procedure, the appropriate zoning and land use regulation for such uses, and to recommend adoption of regulatory standards and conditions to be imposed on such operations.”

The town of Erie, Colorado, extends existing moratorium on oil and gas development projects for a 6-month period, waiting for potential new oil and gas legislation

On January 22, 2019, the town of Erie, Colorado, approved an emergency ordinance that extended an existing moratorium on oil and gas development projects that was set to expire on February 20, 2019. This new moratorium will be in effect until August 13, 2019. The Erie Board of Trustees initially established the moratorium in July 2018 pending an investigation of regulatory practices associated with oil and gas developments used in other cities and towns across the state. The Board of Trustees has explained that the extension of the moratorium will be beneficial as the 2019 session of the Colorado General Assembly is expected to consider new oil and gas legislation “and that legislation may broaden municipal authority over oil and gas development.”

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This material is based upon work supported by the National Agricultural Library, Agricultural Research Service, U.S. Department of Agriculture.