Tuesday, April 7, 2020

Shale Law Weekly Review - April 7, 2020

Written by:
Sara Jenkins – Research Assistant 
Jackie Schweichler – Staff Attorney
Brennan Weintraub – Research Assistant
The following information is an update of recent local, state, national and international legal developments relevant to shale gas.     
National Energy Policy/Public Health: EPA Announces Temporary Policy Change for Environmental Compliance Obligations Amid Covid-19 
On March 26, 2020, the U.S. Environmental Protection Agency (EPA) announced a temporary policy change for environmental compliance obligations amid the Covid-19 outbreak.  EPA recognized that many firms under environmental compliance obligations may have had changing circumstances due to Covid-19 social distancing protocols that restrict the ability to continue with normal business operations.  The policy’s scope is intended to address staff shortages that may affect laboratory services, reporting and emissions requirements, or management of hazardous waste and drinking water.  EPA outlined enforcement discretion for civil violations in the following areas: routine compliance monitoring and reporting by regulated entities; settlement agreement and consent decree reporting obligations and milestones; facility operations; public water systems regulated under the Safe Drinking Water Act; and critical infrastructure.  The policy change does not apply to criminal actions, Superfund enforcement, or product imports.   

Tax Policy: Pennsylvania Governor Vetoes Energy Tax Credit Bill
On March 27, 2020, Pennsylvania Governor Tom Wolf vetoed House Bill 1100 which sought to provide an energy and fertilizer manufacturer’s tax credit.  The bill was passed by the Senate and conferred by the House on February 4, 2020.  The bill designated a tax credit for companies that purchased natural gas and used it in the manufacturing of petrochemicals or fertilizers.  In his announcement, Governor Wolf stated, “Although the bill requires payment of prevailing wages for facility construction . . . the critical enforcement and investigative tools provided under the Pennsylvania Prevailing Wage Act are absent from this bill.”  Governor Wolf also cited a need to focus on passing other bills that promote jobs for those impacted by the Covid-19 outbreak. 

Public Lands: Federal Court Upholds BLM Decision to Repeal 2015 Hydraulic Fracturing Rule 
On March 27, 2020, the U.S. District Court for the Northern District of California upheld the Bureau of Land Management’s (BLM) decision to repeal their 2015 rule regulating hydraulic fracturing on federal and Indian lands. (State of California v. Bureau of Land Management, No. 18-cv-00521-HSG, and Sierra Club v. Zinke, No. 18-cv-00524-HSG).  The rule titled, Oil and Gas; Hydraulic Fracturing on Federal and Indian Lands, was repealed by BLM in response to President Trump’s Executive Order 13783 promoting energy independence.  The State of California and several environmental advocacy groups filed suit against BLM for the repeal of the rule alleging violations of several federal statutes, including the Mineral Leasing Act and the Endangered Species Act.  The court found that BLM provided a reasonable explanation for determining that their pre-2015 regulations were sufficient in addressing hydraulic fracturing on federal lands.  Additionally, the court held that BLM’s conclusion that there would be “no effect to threatened species” as a result of the rule repeal was not “arbitrary and capricious in light of the totality of the record.”  

Pipelines: FERC Denies Rehearing on Columbia Gas Transmission Project
On March 25, 2020, the Federal Energy Regulatory Commission (FERC) issued an Order denying a rehearing on the approval of Columbia Gas Transmission and Columbia Gulf Transmission’s pipeline projects (Projects).  Allegheny Defense Project, along with other environmental advocacy groups, filed the request for rehearing alleging that the Project’s Environmental Impact Statement (EIS) did not comply with the Natural Gas Act (NGA) and the National Environmental Policy Act (NEPA).  FERC’s Order addressed each concern raised by the Petitioners including: impacts to water resources, endangered species, air quality and climate change.  FERC found that the EIS met NGA and NEPA requirements in each area of concern.  Commissioner Glick filed a dissent in part regarding the Commission's consideration of impacts to climate change.  Commissioner McNamee filed a concurrence to further address whether FERC is required to consider environmental effects of upstream production or downstream use of natural gas.  

Air Quality: EPA Science Advisory Board Declines to Review Proposed Rule on Oil and Natural Gas Emissions Standards 
On March 30, 2020, the U.S. Environmental Protection Agency’s Science Advisory Board (SAB) scheduled a public teleconference on a proposed rule regarding oil and natural gas emissions standards.  According to Inside EPA, SAB declined to review the proposed rule due to time constraints before the final rule is published.  The rule titled, Oil and Natural Gas Sector: Emission Standards for New, Reconstructed, and Modified Sources Review, proposes to rescind the methane-specific requirements of the new source performance standards related to production and processing. (rule summary).  EPA also is considering “alternative interpretations to its statutory authority to regulate pollutants under the Clean Air Act.”  

Pipelines: Texas Court Denies Preliminary Injunction, Allowing Kinder Morgan Pipeline Project to Continue
On March 19, 2020, the U.S. District Court for the Western District of Texas denied a Preliminary Injunction that was requested to delay Kinder Morgan’s natural gas pipeline project. (City of Austin v. Kinder Morgan Texas Pipeline, LLC, No. 1:20-CV-138-RP).  After being denied a Temporary Restraining Order on the project, the City of Austin filed for a Preliminary Injunction under the Endangered Species Act (ESA) and the National Environmental Policy Act (NEPA).  The City of Austin argued that Kinder Morgan must first obtain an incidental take permit under the ESA before proceeding with pipeline construction that will travel through golden-cheeked warbler habitat.  The City of Austin also argued that the U.S. Fish and Wildlife Service’s issuance of a Biological Opinion and Incidental Take Statement regarding the pipeline’s construction was a “major federal action” subject to NEPA procedures.  The District Court ultimately denied the Preliminary Injunction finding that the City of Austin failed to show “irreparable harm” to a protected species, and that other alleged harms were too speculative for injunctive relief.  To read about the District Court’s previous denial of the Temporary Restraining Order, see our Shale Law Weekly Review for February 25, 2020

Pipelines: Federal District Court Rules Environmental Impact Statement Needed for Dakota Access Pipeline
On March 25, 2020, the U.S. District Court for the District Court of Columbia ruled that the U.S. Army Corps of Engineers (Corps) must prepare an Environmental Impact Statement (EIS) for the Dakota Access Pipeline (Pipeline). (Standing Rock Sioux Tribe v. U.S. Army Corps of Engineers, No. 16-1534 (JEB)).  The Corps previously issued a Finding of No Significant Impact for an easement that the pipeline needs to cross under Lake Oahe, a reservoir in the Missouri River.  The Standing Rock Sioux Tribe along with other tribes located near the easement location filed suit challenging the Corps’ finding that construction of the pipeline would have no significant impact on the environment.  The nearby Tribes use the lake for various purposes including drinking water and agricultural uses.  The court found that the Corps did not adequately address expert comments that raised questions regarding “leak-detection systems, operator safety records, adverse conditions, and worst-case discharge.”  Therefore, the court concluded that the Corps will need to prepare an EIS to address the expert concerns.  The court did not rule on the status of the easement, but allowed each party to prepare arguments for what should happen to the easement while the EIS is being prepared.  

Pipelines: South Dakota Governor Signs Riot Boosting Bill
On March 18, 2020, South Dakota Governor Kristi Noem signed HB 1117, amending liability for riot boosting and establishing an “incitement to riot” section.  The bill amends several sections of the statute, including sections on “riot,” “definitions,” “liability for riot or riot boosting,” and “recovery of damages.”  The bill creates a new “incitement to riot section” that includes “instigating, inciting, or directing” the use of force or violence with three or more people.  Governor Noem stated that the purpose of HB 1117 is to ensure that future pipelines in the state will be constructed safely and efficiently.  The State House of Representatives passed the bill 45 to 25, and the State Senate passed the bill 27 to 8. According to the bill, violations of the “riot” section or “incitement to riot” section are class 4 felonies.   

From the National Oil & Gas Law Experts:
AGENCY PRESS RELEASES—STATE/FEDERAL
Pennsylvania Department of Energy Press Releases:
No new releases Mar. 30 - Apr. 6, 2020.

U.S. Department of Energy
U.S. Environmental Protection Agency
STATE ACTIONS—EXECUTIVE/LEGISLATIVE
Pennsylvania Executive Agencies—Actions and Notices: 
No actions Apr. 6, 2020. 

Pennsylvania Legislature:
H.B. 1100 “Energize PA Legislative Package” Veto No. 2 (Mar. 30, 2020)
S.B. 1099 “Pennsylvania Energy and Water Efficiency Standards Act.” Referred to Consumer Protection and Professional Licensure (Apr. 3, 2020)

FEDERAL ACTIONS—EXECUTIVE/LEGISLATIVE
Federal Executive Agencies—Actions and Notices: 
Energy Department
85 FR 18944 “Lake Charles Exports, LLC; Application to Amend Existing Long-Term Authorizations to Export Liquefied Natural Gas to Non-Free Trade Agreement Countries” Notice (Apr. 3, 2020)

Environmental Protection Agency
85 FR 18221 “National Fuel Gas Supply Corporation; Notice of Intent to Prepare an Environmental Assessment for the Amendment to West Side Expansion and Modernization Project and Request for Comments on Environmental Issues” Notice (Apr. 1, 2020)
85 FR 18227 “Alternative Methods for Calculating Off-Cycle Credits Under the Light-Duty Vehicle Greenhouse Gas Emissions Program: Application From Toyota Motor North America” Notice (Apr. 1, 2020)
85 FR 18228 “Proposed Information Collection Request; Comment Request; Regulation of Fuels and Fuel Additives; Gasoline Volatility” Notice (Apr. 1, 2020)

Federal Energy Regulatory Commission 
85 FR 17868 "Transcontinental Gas Pipe Line Company, LLC; Notice of Schedule for Environmental Review of a Proposed Amendment of the Northeast Supply Enhancement Project” Notice (Mar. 31, 2020)
85 FR 17869 “Double E Pipeline, LLC; Notice of Availability of the Environmental Assessment for the Proposed Double E Pipeline Project” Notice (Mar. 31, 2020)
85 FR 17870 “Iroquois Gas Transmission System, L.P.; Notice of Intent to Prepare an Environmental Assessment for the Proposed Enhancement by Compression Project and Request for Comments on Environmental Issue” Notice (Mar. 31, 2020)
85 FR 18224 “Transcontinental Gas Pipe Line Company, LLC; Notice of Extension of Time Request” Notice (Apr. 1, 2020)
85 FR 18573 “Northwest Pipeline, LLC; Notice of Extension of Time Request” Notice (Apr. 2, 2020)

House Energy and Commerce Committee Actions:
No new actions Mar. 30 - Apr. 6, 2020

Senate Energy and Natural Resources Committee Actions: 
No new actions Mar. 30 - Apr. 6, 2020.
Follow us on Twitter at PSU Ag & Shale Law (@AgShaleLaw) to receive ShaleLaw HotLinks:
“Pipeline Operators May Seek Legal Protection as Pandemic Causes Oil Demand to Plummet,” Houston Chronicle
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, Google Podcasts, or Stitcher.
Check out the February 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, March 23, 2020

Shale Law Weekly Review - March 23, 2020

Written by:
Sara Jenkins – Research Assistant 
Jackie Schweichler – Staff Attorney
Brennan Weintraub – Research Assistant
The following information is an update of recent local, state, national and international legal developments relevant to shale gas.    
Federal Lands: Ohio District Court Rules that Wayne National Forest Leasing Decisions Failed to Account for Impacts of Hydraulic Fracturing
On March 13, 2020, the U.S. District Court for the Southern District of Ohio ruled that the decision to lease land for mineral extraction in the Wayne National Forest (Forest) failed to account for the impacts of hydraulic fracturing. (Center for Biological Diversity v. U.S. Forest Service, No. 2:17-cv-372).  In October 2016, the Bureau of Land Management (BLM) issued an Environmental Assessment with a Finding of No Significant Impact on lands proposed for leasing in the Marietta Unit of the Forest.  In May 2017, environmental groups, including the Center for Biological Diversity, filed a complaint alleging the U.S. Forest Service’s (USFS) approval of the BLM lease proposals violated the National Environmental Policy Act by failing to prepare an Environmental Impact Statement before making the leasing decisions.  The court concluded that both USFS and BLM failed to take a hard look at the impacts of hydraulic fracturing in the Forest including: surface area disturbance, impacts on the Indiana Bat and the Little Muskingum River, and impacts on air quality.  The court will accept additional briefings from each of the parties to determine the appropriate remedy.

GHG Emissions: Massachusetts District Court Remands Climate Change Lawsuit Back to State Court
On March 17, 2020, the U.S. District Court for the District of Massachusetts ordered that a lawsuit against Exxon Mobil Corp. be remanded back to state court. (Commonwealth of Massachusetts v. Exxon Mobil Corp., No. 19-12430-WGY).  In their Complaint, the State of Massachusetts alleged that Exxon violated the Massachusetts Consumer Protection Act by misrepresenting climate change risks, making false and misleading statements to investors, failing to disclose the climate change risk of using its products, and promoting false and misleading greenwashing campaigns.  Exxon moved the case to federal district court, arguing that the case raised federal issues and that climate change suits fall under federal common law. Massachusetts argued that the Complaint did not raise any federal issues allowing federal court jurisdiction and that Exxon did not meet its burden to establish federal jurisdiction.  After hearing oral arguments on the matter of jurisdiction, the District Court ultimately ordered the case to be remanded back to state court.  

Production and Operation: Colorado District Court Dismisses Case Challenging “Forced Pooling” Law
On March 18, 2020, the U.S. District Court for the District of Colorado dismissed a case challenging the “forced pooling” provision of the Colorado Oil and Gas Conservation Act. (Wildgrass Oil and Gas Comm. v. State of Colorado, No. 19-cv-00190-RBJ). Wildgrass Oil and Gas Committee filed the Complaint, alleging that the statute is unconstitutional, that Colorado Oil and Gas Conservation Commission is impairing non-consenting mineral owners’ due process rights, and that the statute allows unlawful trespass and violates the right to contract.  The District Court found that Wildgrass failed to state a due process claim, a contracts claim, or a First Amendment claim.  The court dismissed the case concluding that a federal court was not the appropriate forum to address issues of state law.

Infrastructure: Minnesota Supreme Court Will Review Decision Involving Utility’s Proposed Natural Gas Power Plant in Wisconsin
On March 17, 2020, the Minnesota Supreme Court granted a petition for review of a decision involving the Minnesota Public Utilities Commission’s approval of a proposed natural-gas power plant in Wisconsin. (In the Matter of Minnesota Power's Petition for Approval of the EnergyForward Resource Package, Nos. A19-0688, A19-0704).  In the Court of Appeals Decision, the court reversed the Commission's approval of Minnesota Power’s proposal to construct, operate, and purchase Nemadji Trail Energy Center in Superior, Wisconsin. Environmental advocacy groups previously petitioned the Commission to prepare an Environmental Assessment Worksheet before approving Minnesota Power’s proposal.  The Appellate Court’s reversal of the Commission’s approval requires the Commission to determine whether the proposal may have significant environmental impacts.  The Minnesota Supreme Court will review the Appellate Court’s decision. 

LNG Infrastructure: FERC Issues Draft Environmental Impact Statement for Jordan Cove LNG Project 
On March 29, 2020, the Federal Energy Regulatory Commission (FERC) issued a Draft Environmental Impact Statement for the Jordan Cove LNG project (Project).  FERC concluded that the Project would result in “temporary, long-term, and permanent impacts on the environment,” but that those impacts could be reduced to less-than-significant levels through mitigation measures.  FERC also concluded that the Project is likely to adversely affect some federally-listed species including: the marbled murrelet, northern spotted owl, and coho salmon.  The Project is proposed to consist of a liquified natural gas terminal in Coos County, Oregon with a pipeline designed to transport natural gas 229 miles from Malin, Oregon to the proposed terminal.  FERC is accepting public comments on the Draft Statement until July 5, 2020.
From the National Oil & Gas Law Experts:
John McFarland, A Little History of Gas Flaring in Texas (Mar. 18, 2020)

AGENCY PRESS RELEASES—STATE/FEDERAL
Pennsylvania Department of Energy Press Releases:
No new releases Mar. 16–23, 2020.

U.S. Department of Energy

U.S. Environmental Protection Agency
No new releases Mar. 16-22, 2020.

STATE ACTIONS—EXECUTIVE/LEGISLATIVE
Pennsylvania Executive Agencies—Actions and Notices: 
No new actions Mar. 22, 2020.

Pennsylvania Legislature:
No new actions Mar. 22, 2020

FEDERAL ACTIONS—EXECUTIVE/LEGISLATIVE
Federal Executive Agencies—Actions and Notices: 

Energy Department
85 FR 15442 “Texas LNG Brownsville, LLC; Opinion and Order Granting Long-Term Authorization to Export Liquefied Natural Gas to Non-Free Trade Agreement Nations” Notice (Mar. 18, 2020)
85 FR 15442 “Eagle LNG Partners Jacksonville, LLC; Opinion and Order Granting Long-Term Authorization to Export Liquefied Natural Gas to Non-Free Trade Agreement Nations” Notice (Mar. 18, 2020)
85 FR 15443 “Annova LNG Common Infrastructure, LLC; Opinion and Order Granting Long-Term Authorization to Export Liquefied Natural Gas to Non-Free Trade Agreement Nations” Notice (Mar. 18, 2020)
85 FR 15443 “Rio Grande LNG, LLC; Opinion and Order Granting Long-Term Authorization to Export Liquefied Natural Gas to Non-Free Trade Agreement Nations” Notice (Mar. 18, 2020)

85 FR 15444 “Venture Global Plaquemines LNG, LLC; Opinion and Order Granting Long-Term Authorization to Export Liquefied Natural Gas to Non-Free Trade Agreement Nations” Notice (Mar. 18, 2020)
85 FR 15769 “Cameron LNG, LLC; Application for Blanket Authorization to Export Liquefied Natural Gas to Non-Free Trade Agreement Countries on a Short-Term Basis” Notice (Mar. 19, 2020)

Environmental Protection Agency
85 FR 15729 “Amendments to Federal Implementation Plan for Managing Air Emissions From True Minor Sources in Indian Country in the Oil and Natural Gas Production and Natural Gas Processing Segments of the Oil and Natural Gas Sector” Rule (Mar. 19, 2020)

Federal Energy Regulatory Commission 
85 FR 15160 “Apex Oil Company, Inc. FutureFuel Chemical Company v. Colonial Pipeline Company; Notice of Complaint” Notice (Mar. 17, 2020)
85 FR 15160 “Explorer Pipeline Company; Notice of Petition for Declaratory Order” Notice (Mar. 17, 2020)
85 FR 15165 “Texas Eastern Transmission, LP; Notice of Schedule for Environmental Review of the Lilly Compressor Units Replacement Project” Notice (Mar. 17, 2020)
85 FR 15446 “Magnum Gas Storage, LLC; Notice of Motion to Partially Vacate Certificate Authorization or in the Alternative, Motion to Amend Certificate Authorization” Notice (Mar. 18, 2020)
85 FR 15713 “Natural Gas Pipelines; Project Cost and Annual Limits” Rule (Mar. 19, 2020)
85 FR 15772 “Columbia Gas Transmission, LLC; Notice of Request Under Blanket Authorization” Notice (Mar. 19, 2020)
85 FR 15774 “Enable Gas Transmission, LLC, Enable Gulf Run Transmission, LLC; Notice of Application” Notice (Mar. 19, 2020)

Foreign-Trade Zones Board
85 FR 16054 “Foreign-Trade Zone (FTZ) 116-Port Arthur, Texas, Notification of Proposed Production Activity, Port Arthur LNG, LLC (Liquefied Natural Gas Processing), Port Arthur, Texas” Notice (Mar. 20, 2020)

Justice Department
85 FR 15815 “Notice of Lodging of Proposed Consent Decree Under the Clean Water Act, the Oil Pollution Act of 1990, and the Pipeline Safety Laws” Notice (Mar. 19, 2020)

House Energy and Commerce Committee Actions:
No new actions Mar. 16-23, 2020.

Senate Energy and Natural Resources Committee Actions: 
No new actions Mar. 16-23, 2020.
Follow us on Twitter at PSU Ag & Shale Law (@AgShaleLaw) to receive ShaleLaw HotLinks:
“Science Advisory Board to Review Methane, Water Rules,” Greenwire
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, Google Podcasts or Stitcher.
Check out the February 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!