Shale Gas Weekly Review - October 31, 2016

PA Court Dismisses Appeal in Well Water Contamination Case

On October 26, 2016, the Commonwealth Court of Pennsylvania affirmed the PA Environmental Hearing Board’s decision to dismiss Loren Kiskadden’s appeal. (Kiskadden v. Pennsylvania DEP 1167 c.d. 2015)  Kiskadden originally filed a complaint with the DEP alleging that the nearby Yeager Site was the cause of contamination in his water well. The Yeager Site is “a centralized impoundment for the storage of gas well related waters, a drill cuttings pit, and a mud processing pit, as well as three unconventional gas wells…” and is owned by Range Resources-Appalachia, LLC. The court concluded that the Board’s findings were “supported by substantial evidence” and Kiskadden did not prove by a preponderance of the evidence that the water contamination was caused by the Yeager Site.

Hearing Held on New Pennsylvania Shale Gas Drilling Regulations

On October 26, 2016, the Marcellus Shale Coalition and the PA Department of Environmental Protection argued in front of a Commonwealth Court judge in regards to the new drilling regulations that went into effect October 8th. (25 PA. CODE CHS. 78 AND 78a) According to PowerSource, the Marcellus Shale Coalition argued that the regulations “inherently violate current law and cause immediate harm to its members…” Meanwhile, DEP deputy secretary Scott Perry testified to the “length and depth of the process” used to create the new regulations.

DEP Announces Civil Penalty against JKLM Energy for Water Contamination

On October 24, 2016, the PA Department of Environmental Protection announced a $472,317 civil penalty against JKLM Energy for damage caused in Potter County. While drilling a natural gas well in September, the drill bit became stuck and JKLM used an unapproved lubricant in attempt to retrieve the drill bit. The unapproved lubricant migrated to groundwater sources, included six private water wells. JKLM will also pay $100,000 for a Community Environmental project that will monitor Potter County public water supplies.

US Appeals Court Affirms District Court’s Denial of Drilling Injunction

The U.S. Court of Appeals for the 10th Circuit issued an opinion October 27, 2016, affirming the district court’s decision to allow for continued oil and gas permitting in the Chaco Canyon area. Several environmental groups filed suit in March 2015 under the National Environmental Policy Act. The district court denied the groups’ motion for preliminary injunction, holding that “Plaintiffs were not likely to succeed on the merits of their claims...” The Court of Appeals affirmed the decision holding that the lower court did not abuse their discretion in denying the injunction.

New Brief Deadline Schedule for Clean Air Act Case

On October 25, 2016, the U.S. Court of Appeals for the Sixth Circuit issued a revised schedule for Murray Energy Corp. v. U.S. EPA brief deadlines, according to Greenwire. The case was filed as an objection to the coal-fired power plant emission standards in the EPA’s Clean Air Act. Initial proof briefs on the merits must be submitted by Murray Energy Corp. on or before November 1st. The EPA and other responding agencies will have until January 18 to submit their proof brief in response.

New Power Plant in Bradford County to Use Marcellus Gas

A ribbon cutting ceremony was held October 27, 2016, for the new Panda Liberty Power Plant. The new power plant is unique because it is the first power plant in Pennsylvania that will be fueled directly with gas from the Marcellus shale formation.  Located in Bradford County, the 829 Megawatt plant will use air rather than water to keep cool, making it more energy efficient.

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

Recent ShaleLaw HotLinks include:

Marcellus Shale Power Plant Commissioned in Bradford County - StateImpactPA

Amish Oppose Use of Drilling ‘Brine’ Wastewater on Roads - PittsburghPG

Judge Weighs Whether to Put New PA Shale Drilling Rules on Hold – PittsburghPG

Energy Producers Edge Closer to Tapping ‘Drilled but Uncompleted’ Wells – WSJ

Three 5.0 Quakes Since 2011 Make Up 2/3 of Oklahoma’s Seismic Energy; ‘Pressure Pulse’ May Trigger Another Large One – Tulsa World

PA Gas Royalties Bill Likely Dead This Session – StateImpact

EPA Releases New Oil and Gas Pollution Guidelines – The Hill

AP report on Landowner Lawsuit Over 2013 Oil Pipeline Breach in Arkansas – AP

Written by Jacqueline Schweichler - Education Programs Coordinator

Shale Gas Weekly Review - October 25, 2016

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

PA Superior Court Affirms Ruling to Reform Deed Due to Mutual Mistake of Parties

On October 18, 2016, the Superior Court of Pennsylvania affirmed the lower court’s order and ruled for reformation of a deed for land to include a reservation of all oil, gas, and mineral rights. (George v. George, Pa. Super. Ct. 2016) Patrick George had sold to his aunt and uncle, Anthony and Suzanne George, property located in Washington County. The agreement of sale for the property included a reservation of the oil, gas, and mineral rights. However, the general warranty deed conveyed the land in fee simple with no reservations. The lower court held that there was a mutual mistake and that the intent of the parties included a reservation of the oil, gas, and mineral rights, a holding which is now affirmed.

White House Task Force Issues Final Report on Natural Gas Storage Safety

On October 18, 2016, the Interagency Task Force on Natural Gas Storage Safety released their report with recommendations for new safety procedures. The Task Force was created by the White House as a response to the Aliso Canyon facility natural gas leak in 2015. The report recommends that gas storage operators evaluate the status of their wells and establish risk management plans. The report also calls for better understanding of the potential risks and advanced preparations to promote a coordinated response to emergency situations.

New Guidelines Issued by EPA for Oil and Gas Emissions

The Environmental Protection Agency issued new non-binding Control Techniques Guidelines (CTGs) on October 20, 2016, regarding volatile organic compound (VOC) emissions from oil and gas processes. These new guidelines offer recommendations for state agencies to assist them in the reduction of VOC pollution. The CTGs recommend technologies and approaches that are “widely available at a reasonable cost” and can reduce venting of natural gas during the drilling process.

EIA Releases October Drilling Productivity Report

On October 17, 2016 the U.S. Energy Information Administration released its Drilling Productivity Report with estimates for November’s oil and gas production. According to the EIA, overall oil production is expected to decrease in the major shale plays from 4.46 to 4.43 million barrels/day. In addition, U.S. gas production is also supposed to decrease from 46.13 to 45.96 billion cubic feet/day.

Dakota Access Pipeline Equipment Damage Caused by Arson  

As reported by Reuters, on October 22, 2016, equipment used for the construction of the Dakota Access pipeline was purposefully set on fire. The Dakota Access Pipeline is intended for the transport of crude oil from North Dakota to Illinois. There was approximately two million dollars worth of damage done to the construction equipment. There are currently no suspects.  

Memorandum of Understanding Signed Between Gazprom and India

On October 15, 2016, the global energy company, Gazprom announced the signing of a Memorandum of Understanding between Gazprom and the Director of Engineers India. The agreement outlines the intent of the parties to explore potential routes for a pipeline that would bring gas from Russia to India. The agreement was signed during the India-Russia Annual Summit.

Written by Jacqueline Schweichler - Education Programs Coordinator

Shale Gas Weekly Review - October 17, 2016

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

Marcellus Shale Coalition Files Suit Against New Drilling Regulations

On October 13, 2016, the Marcellus Shale Coalition filed a lawsuit in the Commonwealth Court of Pennsylvania against the PA DEP (Marcellus Shale Coalition v. Department of Environmental Protection of the Commonwealth of Pennsylvania, 573 MD 2016). The Marcellus Shale Coalition is challenging the DEP’s implementation of new drilling regulations under the authority of Act 13. They suggest that the new rules are vague, conflict with other applicable statutes, and some sections constitute special laws, a violation of the PA Constitution.

District Court Rules Private Nuisance Claim May Continue Against SEPCO

The U.S. District Court for the Middle District of Pennsylvania issued a ruling denying Southwestern Energy Production Company’s Motion for Summary Judgment on October 13, 2016. (Tiongco v. Southwestern Energy Prod. Co. (3:14 - CV - 1405) The case was originally brought by Stephanie Tiongco alleging an intentional private nuisance claim against SEPCO for its drilling and gas exploration activities which created “excessive noise, light, and vibrations.” SEPCO filed a motion for Summary Judgment which the court denied here because SEPCO could not show there were “no genuine issues of material fact.”

EPA Agrees to Review VOC Emissions at Natural Gas Production Sites

On October 7, 2016, the U.S. District Court for the District of Columbia signed a consent decree where the Environmental Protection Agency (EPA) has agreed to review the Natural Gas volatile organic compounds (VOCs) emissions factor under the Clean Air Act (Air Alliance Houston v. Gina McCarthy, 1:16-cv-01998). The EPA will have until June 2017 to review and propose revisions to the VOC emissions factor of “elevated flares and enclosed ground flares at natural gas production sites.” The EPA will then have until February 2018 to issue final revisions or make a final determination that revisions are not necessary.

SELC Files FERC Challenge Against Dominion Transmission’s New Pipeline

The Southern Environmental Law Center filed a motion with the Federal Energy Regulatory Commission on October 13, 2016 challenging a proposed pipeline in Virginia. (Shenandoah Valley Network, Highlanders to Reject Route through Conservation Easements filed by Southern Environmental Law Center under CP15-554, et. al.) The SELC argues that the pipeline’s conversion of conservation easements will “undermine public trust” and the pipeline proposal “is not consistent with Virginia state law.”  The Atlantic Coast Pipeline’s current route will go through the Appalachian Mountains. According to Dominion Transmission, Inc., the pipeline will be 600 miles long and start in West Virginia, run through Virginia, and then end in North Carolina.

FERC Approves Sabine Pass Liquefaction Train 2

On October 12, 2016 the Federal Energy Regulatory Commission issued an approval letter to Cheniere Energy, Inc. for a second liquefaction train at Sabine Pass in Louisiana. The FERC says the project “can be expected to operate safely as designed” and is in compliance.  According to Cheniere, the Sabine Pass LNG terminal can accommodate six liquefaction trains. Each LNG train will have a production capacity of 4.5 million tons per annum.

ExxonMobil and InterOil Transaction Approved by Canadian Court

On October 10, 2016, the Supreme Court of Yukon granted approval for the pending InterOil deal with ExxonMobil (Re: Interoil Corporation, 2016 YKSC 54). The court found the transaction to be “fair and reasonable.” There was no dispute that the arrangement complied with statutory requirements and had been “put forward in good faith.” The transaction will involve a $2.5 billion exchange where ExxonMobil will acquire InterOil’s outstanding shares. ExxonMobil will pay $45 per share and will obtain licenses on approximately four million acres in Papau New Guinea. 

Written by Jacqueline Schweichler - Education Programs Coordinator

Shale Gas Weekly Review - October 11, 2016

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

New Pennsylvania Oil and Gas Regulations Take Effect

The new rules (25 PA. CODE CHS. 78 AND 78a) promulgated by the Environmental Quality Board were posted in the Pennsylvania Bulletin on October 7, 2016, and went into effect the next day. The rules are intended to set standards for the oil and gas industry to maximize safety and environmental protection. The rules include “public resource impact screening, water supply replacement standards, waste management and disposal, and establishing identification and select monitoring of wells located proximal to hydraulic fracturing activities.” The changes add a new chapter (Chapter 78a) to address specific requirements for unconventional wells and revise the existing requirements pertaining to conventional wells (Chapter 78) to avoid conflicts with the unconventional well requirements.

PHMSA Issues Interim Final Rule for Pipeline Safety

On October 3, 2016, the Pipeline and Hazardous Materials Safety Administration (PHMSA) issued an Interim Final Rule (IFR) intended to provide additional protections for pipeline safety. The new rule establishes procedures that allow for emergency orders “to address an unsafe condition or practice, or combination of unsafe conditions or practices, that pose an imminent hazard to public health and safety or the environment.” This rule is a direct response to the PIPES Act which gives PHMSA imminent hazard authority to respond to pipeline emergencies.

EPA Adds Updates from 2015 for Greenhouse Gas Reporting Program

The Environmental Protection Agency has published information on petroleum and natural gas systems emissions of greenhouse gases. From 2014 to 2015, facilities reporting emissions for carbon dioxide, methane, and nitrous oxide decreased from 2,416 to 2,413. From 2014 to 2015, carbon dioxide emissions decreased from 161.9 to 160.5 million metric tons and methane emissions decreased from 73.1 to 70.3 million metric tons. Reported emissions of nitrous oxide increased from 0.1 to 0.6 million metric tons.

Dakota Access, LLC, Moves Forward After U.S. District Court Order

On October 9, 2016 the U.S. Court of Appeals for the D.C. Circuit issued an order dissolving an injunction that prohibited continued construction of the Dakota Access Pipeline. (Standing Rock v. U.S. Army Corps of Engineers, 1:16-cv-01534-JEB). The court held that the Standing Rock Sioux Tribe was not able to show a substantial likelihood of success on the merits or that there would be irreparable harm without the injunction.  However, construction of the pipeline is still prohibited by the U.S. Army Corps of Engineers on land near Lake Oahe.

New Study Reviews Methane Emissions from Fossil Fuels

A study published in Nature, International Weekly Journal of Science on October 5, 2016, evaluated methane emission trends from the global fossil fuel industry. According to the study, emissions coming from “natural gas, oil and coal production and their usage are 20 to 60 per cent greater than inventories.” However, the study also found that methane emissions from fossil fuel production have declined “from approximately 8 per cent to approximately 2 per cent over the past three decades.” The study is entitled “Upward Revision of Global Fossil Fuel Methane Emissions Based on Isotope Database.”

Cuadrilla Shale Company Permitted to Drill in Lancashire

On October 6, 2016, the UK Department for Communities and Local Government secretary Sajid Javid accepted the appeal for exploratory unconventional drilling for four wells at Preston New Road. The secretary deferred his decision on the second drilling site, Roseacre Wood, to allow for more information gathering. Objections by Lancashire council cited “visual impact and noise” when they initially refused to approve the drilling site applications. With their drilling applications now approved, Cuadrilla is set to begin the project in 2017.

Brazil Passes Bill Allowing More Foreign Participation in Oil Fields

According to the Brazil-U.S. Business Council, on October 5, 2016, the Brazilian House of Representatives passed a bill that removes the participation requirements of Petrobras in developmental activities. Previously, Petrobras was required to participate in 30% of oil field exploration as well as act as the operator of the field. This new bill makes the participation optional, allowing other foreign investors to participate more fully in oil exploration and development.

 Written by Jacqueline Schweichler - Education Programs Coordinator

Shale Gas Weekly Review - October 3, 2016

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

PA Supreme Court Declares Portions of Act 13 Unconstitutional

On September 28, 2016, the Pennsylvania Supreme Court issued an opinion addressing the constitutionality of Act 13 for a second time, striking down additional provisions of the landmark oil and gas legislation. In the present opinion, the court invalidated provisions of Act 13 involving the oversight of local oil and gas ordinances by the Public Utility Commission [sections 3305-3309]; the disclosure of information to health professionals for chemicals considered by oil and gas operators to be trade secrets [section 3222.1(b)(10) and (11)]; the notification to public water facilities by DEP following chemical or waste spills [section 3218.1]; and the exercise of eminent domain authority by a private corporation to acquire rights related to natural gas storage [section 3241]. (Robinson Twp. v. Commonwealth).

Maryland Proposes New Regulations for Oil and Gas Exploration

On September 26, 2016, the Maryland Department of the Environment unveiled proposed regulations for oil and gas development. The regulations include a setback requirement of 2,000 feet from private drinking water wells and 1,000 feet from public water supply wells. The regulations also include one year baseline monitoring of water near the well pad. Additionally, there will be a presumption that any contamination occurring within the first year of drilling will be the fault of the well operator unless they can prove otherwise.

EIA Reports Significant Increase in Production from Utica Shale

On September 23, 2016, the Energy Information Administration published a report on recent hydrocarbon production from the Appalachian Basin’s Utica Play. The data showed that in 2012 only 104 wells existed in the Utica shale which produced 0.1 billion cubic feet per day (Bcf/d) of natural gas and 4,400 barrels per day (b/d) of oil. By June 2016, the Utica play produced 3.5 Bcf/d of gas and 76,000 b/d of oil. The EIA also notes that while the Utica produces both oil and gas, recent production is primarily natural gas.

OPEC Resolves to Limit Oil Production for Market Stabilization

While attending a meeting in Algeria, the Organization of the Petroleum Exporting Countries (OPEC) agreed on September 28, 2016, to reconvene and determine limits for oil production. The OPEC intends to put production within a range of 32.5 and 33.0 mb/d. The main objective of the production limitations will be “to stabilize the oil market and avoid the adverse impacts in the short- and medium-term.”

United Nations Special Rapporteur Calls for Halt to Dakota Access Pipeline

On September 22, 2016, the United Nations Human Rights Office of the High Commissioner published a statement regarding the Dakota Access Pipeline. Victoria Tauli-Corpuz, the United Nations Special Rapporteur says the United States should cease construction on the Dakota Access Pipeline to protect drinking water, burial grounds, and sacred sites of the Standing Rock Sioux Tribe. Ms. Tauli-Corpuz asks that the United States consult with those affected by the pipeline and obtain their consent before giving approval of the pipeline.

Canada Approves Pacific NorthWest LNG Project with Conditions  

The Minister of the Environment for Canada, Catherine McKenna, issued a decision statement approving the Pacific NorthWest LNG Project on September 27, 2016. Prior to the decision, the Canadian Environmental Assessment Agency published their environmental assessment of the NorthWest project and determined that there would be “significant adverse environmental effects.” It was determined by the Governor in Council that the adverse effects are justified; however, the approval is subject to 190 legally binding conditions.

Written by Jacqueline Schweichler - Education Programs Coordinator