Monday, April 10, 2017

Shale Law Weeky Review - April 10, 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.

U.S. Supreme Court Denies DOJ’s Motion to Hold WOTUS Litigation in Abeyance
On April 3, 2017, the Supreme Court of the United States denied the Justice Department’s request to hold in abeyance the litigation over the Waters of the United States (WOTUS) rule (Nat’l Ass’n of Mfrs. v. DOD, 2017 U.S. LEXIS 2322). The WOTUS rule proposes to define the scope of the waters encompassed by the Clean Water Act to include more waterways and water sources. The new administration had hoped to delay the case in order to obtain more time to review the regulation, according to the Washington Examiner.

DOI Intends to Repeal 2017 Oil and Gas Valuation Reform Rule
On April 4, 2017, the United States Department of the Interior (DOI) announced in a press release their intent to repeal the Consolidated Federal Oil & Gas and Federal & Indian Coal Valuation Reform Rule (2017 Valuation Rule). The purpose of the 2017 Valuation Rule was “to offer greater simplicity, certainty, clarity, and consistency…” and “to ensure that Indian mineral lessors received maximum revenues…” In addition, the rule was meant to provide greater certainty that companies were in compliance as well as to decrease costs. The DOI stated that several parts of the rule “warrant reconsideration to meet policy and implementation objectives.”

Federal Judge Denies Exxon Motion for Preliminary Injunction
On March 30, 2017, the United States District Court for the Southern District of New York denied Exxon Mobil Corporation’s Motion for Preliminary Injunction. (Exxon Mobil Corp. v. Healey, 16-cv-00469). The case was brought by Exxon to stop fraud investigations initiated by the attorneys general of Massachusetts and New York. The purpose of the investigations is to determine if statements by Exxon about climate change constitute fraud against the public and its shareholders. In addition, the court denied Maryland’s Motion for Leave to Proceed Without Local Counsel. The court also ordered a status conference to be held April 21, 2017.

Maryland Approves Bill Banning Hydraulic Fracturing
On April 4, 2017, Maryland Governor Larry Hogan signed House Bill 1325 which will ban hydraulic fracturing in the state of Maryland. The bill specifically prohibits persons “from engaging in the hydraulic fracturing of a well for the exploration or production of oil or natural gas in the State…” Maryland currently has no hydraulic fracturing operations, but they do have natural gas reserves in western Maryland, according to the York Dispatch.

Study by PennEnvironment Examines Patterns of Hydraulic Fracturing Violations
On March 28, 2017, PennEnvironment Research and Policy Center released a study examining consequences of hydraulic fracturing regulation violations. The study is entitled “Oil and Gas Industry Environmental Violations in Pennsylvania.” PennEnvironment found that only 17 percent of violations resulted in a fine upon the drilling company. In addition, they found that the median fine paid by the operator was approximately $5,000, and that since 2008, more than 50 companies have been cited for pollution in Pennsylvania.

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