The following
information is an update of recent, local, state, national, and international
legal developments relevant to shale gas.
Resolution Passed by
Wilmot Township as Protest to Royalty Deductions
Wilmot Township,
Pennsylvania passed a resolution on
September 6, 2016 to discontinue production from oil and gas wells in the county
where the landowner is not guaranteed at least one-eighth of the royalty. The
resolution states that some landowners have received nothing in their royalty
checks while others have a negative balance from excessive deductions. As reported by NGI’s
Shale Daily, the ordinance was passed to protest the high post-productions
costs that were being deducted from royalty checks.
Department of Justice
Announces Refusal to Approve the Dakota Access Pipeline
The Department of
Justice issued a joint statement with the
Department of the Army and the Department of the Interior on September 9, 2016
regarding the contentious construction of the Dakota Access pipeline. The
department stated that authorization for the construction of the pipeline will
be prohibited on Corps land that borders Lake Oahe. This announcement follows
on the heels of a federal court ruling that refused
to grant an injunction to the Standing Rock Sioux Tribe against the U.S. Army
Corps of Engineers. The federal judge held that the plaintiffs did not
sufficiently demonstrate that damage could be prevented by enjoining the Corps
permitting of the pipeline.
California Judge Rules
Against BLM Approval of Drilling Plan
On September 6, 2016 a ruling was issued by
California Judge Michael Fitzgerald that overturned the Bureau of Land
Management’s management plan for federal land. The case was brought by the
Center for Biological Diversity and Los Padres Forestwatch. The plaintiffs
claimed that BLM did not submit a sufficient environmental impact statement
because they failed to adequately address the environmental impact of hydraulic
fracturing. The court held that the BLM now must prepare a supplemental EIS to
examine the environmental impact.
Oklahoma Earthquake
Magnitude Increased to 5.8 and Regulators Close Disposal Wells
On September 3, 2016
Oklahoma experienced its largest recorded earthquake with a 5.8 magnitude near Pawnee, Oklahoma. The earthquake
was initially reported as a 5.6 but further analysis by
the U.S. Geological Survey determined the earthquake to be even greater.
In response, the Oklahoma Corporation Commission implemented an immediate
directive to close down disposal wells in the area. The Oil and Gas
Conservation Division published a letter they sent to
owners of injection wells within the earthquake zone to notify them of the
mandatory closure.
New Dominion Oil Company
Sued for Oklahoma Earthquake Damage by Its Insurer
A New York District
Judge issued a ruling on September
7, 2016 refusing to abstain from hearing a case against the oil company accused
of being a cause of the recent Oklahoma earthquake. New
Dominion LLC is the oil company being sued by several individuals for damage
caused by the September 3rd earthquake. New Dominion sought indemnification
from Lloyd's of London which insures the company against environmental
liability. Lloyd’s, however, argued that it should not have to pay for these
damages since an earthquake is not a “pollution condition.” New Dominion
initiated the case in Oklahoma District Court and Lloyd motioned to transfer
the case to a district court in New York. The district judge ruled that the
forum selection clause in the insurance contract gave the New York court
personal jurisdiction over the company.
New Oil and Gas Resource Play
Discovered in West Texas
Apache Corporation announced September
7, 2016 the discovery of “Alpine High,” a resource play located in Reeves
County, Texas. The new play may have reserves of three billion barrels of oil
and 75 Tcf of natural gas. Currently, Apache has secured over 300,000 acres and
has already drilled 19 wells.
Written by Jacqueline Schweichler - Education Programs Coordinator
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