Monday, February 13, 2017

Shale Law Weekly Review - February 13, 2017

Written by Jacqueline Schweichler - Education Programs Coordinator

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


PA DEP Announces New Permits for Reducing Methane Emissions
On February 6, 2017, the Pennsylvania Department of Environmental Protection announced the opening of the public comment period for new and revised permits for reducing methane emissions at well sites. The proposed General Permit 5A will affect unconventional natural gas drilling and remote pigging stations, while the revised General Permit 5 will affect “compressor stations, transmission stations, and processing plants.” Both permits will establish industry requirements “regarding air emission limits, source testing, leak detection and repair, recordkeeping, and reporting requirements for the applicable air pollution sources.”


Army Announces Intent to Grant Dakota Access Pipeline Easement
On February 7, 2017, the Deputy Assistant Secretary of the Army sent a letter to the United States House of Representatives announcing the Army’s intent to grant an easement to Dakota Access LLC, a company owned by Energy Transfer Partners (ETP). The easement will allow ETP to finish constructing the Dakota Access Pipeline which required this final easement for a right-of-way at Lake Oahe. On February 8, 2017, the Department of the Army formally granted the easement for the pipeline for a term of thirty years.


Texas Appeals Court Reverses in Favor of Aruba Petroleum
On February 1, 2017, the Court of Appeals for the Fifth District of Texas reversed a judgment against Aruba Petroleum Inc., holding that the plaintiffs did not have sufficient evidence to show an intentional nuisance (Aruba Petroleum Inc. v. Parr et al.,  05-14-01285-CV). The landowners sued Aruba and other natural gas extraction companies for “spills, releases, emissions, and discharges of air pollution” on their property. The plaintiffs originally had been awarded almost $3 million in damages for “physical pain and suffering and mental anguish” as well as property damage.


Congress Passes Resolution to Repeal Bill Requiring that Oil and Gas Companies Disclose Payments to Governments
On February 1, and February 3, 2017, the House of Representatives and the Senate, respectively, passed a resolution to repeal a Securities and Exchange Commission (SEC) rule. The rule, “Disclosure of Payments by Resource Extraction Issuers,” would have required oil, gas, and other mineral companies to disclose any payments made to foreign governments. The resolution passed in the House of Representatives by a vote of 235 to 187 and passed the Senate by 52 to 48. On January 6, 2017, the resolution was presented to the President.


Study Suggests Increased Methane Levels in PA Result from Marcellus Shale Development
On February 9, 2017, a study by researchers at several universities and research institutes was published in the journal Elementa: Science of the Anthropocene. The study analyzed concentrations of methane found in the Marcellus Shale region. The study found an increase in methane from 2012 to 2015 and that “emissions from Marcellus Shale development may be responsible for the enhanced concentrations in the region.” The study is called “Analysis of local-scale background concentrations of methane and other gas-phase species in the Marcellus Shale.”


Study Examines Natural Gas Supply Chain to Determine Source of Methane Emissions
On January 23, 2017, a study on methane emission measurements was published in the online version of the Journal of Cleaner Production by the United States Department of Energy’s National Energy Technology Laboratory. The study is entitled “Synthesis of recent ground-level methane emission measurements from the U.S. natural gas supply chain.” The researchers examined the stages of the natural gas supply chain. Specifically, they examined production, processing, transmission and storage, and distribution. They found that “1.7% of the methane in natural gas is emitted between extraction and delivery.”


Canadian Study Shows Possible Link Between Hydraulic Fracturing and Induced Seismicity
On January 18, 2017, a study on induced seismicity relating to hydraulic fracturing operations was published in the Journal of GeophysicalResearch: Solid Earth. The study was done as a collaboration between the Alberta Geological Survey and several universities The study concluded that “[s]ince 1 December 2013, there has been a pronounced increase in the rate of seismicity in the Fox Creek region related to nearby hydraulic fracturing completions in the Duvernay Formation.” The study is entitled “A seismological overview of the induced earthquakes in the Duvernay play near Fox Creek, Alberta.”


Pennsylvania and North Dakota Farmers Receive Highest Royalty Payments in United States
A report by the United States Department of Agriculture entitled “Trends in U.S. Agriculture’s Consumption and Production of Energy: Renewable Power, Shale Energy, and Cellulosic Biomass” examines energy policy and market conditions affecting agriculture. Part of the report shows the percent of farms in each state receiving income from energy related royalties. In states with oil and gas development, twelve percent of farms received an average of $65k from royalties. North Dakota and Pennsylvania had the highest average royalty payment per farm, $157k and $154k, respectively.


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