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.
Pipelines: Pennsylvania
Issues Notice of Violations to Mariner East 2
On March 19, 2018, the
Pennsylvania Department of Environmental Protection (DEP) issued a notice of
violation to Sunoco Pipeline for
the discharge of
drilling fluids
into the Juniata River. According to Sunoco, the overflow was due to drilling
activities that caused water to be released into the drill pit at a rate of 500
gallons per minute, exceeding onsite management capacity. Further, on March 15,
2018, DEP issued two additional violation notices for drilling fluid discharge.
The notices cited violations for spills occurring in Snitz Creek in West
Cornwall Township, Lebanon County, and for discharge of 200 gallons of fluids
within a wetland in Frankstown Township, Blair County. Each of these violations were associated with
the horizontal directional drilling used for the construction of the Mariner East 2
pipeline project.
Wastewater
Treatment/Disposal: Pennsylvania Department of Environmental Protection
Approves Injection Well for Clearfield County
On March 22, 2018, the
Pennsylvania Department of Environmental Protection (DEP) approved an underground injection well for Brady
Township, Clearfield County. The injection well, Windfall Oil & Gas Inc.’s
Frank & Susan Zelman #1, will be used for the disposal of wastewater associated
with oil and natural gas production. The application for the permit was
submitted to DEP in September 2015 and a public hearing was held in March 2016.
Permit approval includes conditions relating to seismic monitoring for early
detection of seismic events.
Severance Tax:
Independent Fiscal Office Releases Report on Proposed Severance Tax
On March 16, 2018,
Pennsylvania’s Independent Fiscal Office (IFO) released a report to assess the impact of the proposed severance
tax. The report was prepared on behalf of Sen. Lisa Baker who asked how a
severance tax could affect post-production costs that are deducted from
landowner’s royalty checks. The IFO suggests that the proposed severance tax
could generate $210 million in tax revenue during the first fiscal year. In
that first year, IFO estimates that $28 million of the tax could be passed back
to landowners. The report notes, however, that the proposed tax specifically
prohibits oil and gas companies from deducting the severance tax from landowner
royalty payments.
Interstate Commissions:
Tri-State Shale Coalition Agreement is Extended
On March 21, 2018,
Pennsylvania, Ohio, and West Virginia agreed to an extension of the Tri-State Shale
Coalition Agreement,
according to a press release from Governor Tom Wolf. The purpose of the
agreement is for each state to cooperate in shale oil and gas development in
order to maximize development opportunities. The agreement highlights four
primary areas of cooperation which includes workforce development, marketing
and promotion, transportation and infrastructure, and research. The agreement
was first signed in 2015 in order to promote tri-state collaboration on
development efforts within the Appalachian Basin to achieve the greatest
economic success.
Pipelines: FERC Approves
Construction of Mountain Valley Pipeline within West Virginia and Virginia
On March 12, 2018, the
Federal Energy Regulatory Commission (FERC) granted Mountain Valley Pipeline, LLC’s request to
commence construction in West Virginia and Virginia. Specifically, FERC is permitting
construction activities within Summers and Webster Counties, West Virginia, and
Giles, Roanoke, and Pittsylvania Counties, Virginia. The notice also grants
Mountain Valley permission to construct additional workspaces in various
counties. FERC determined that the Mountain Valley pipeline satisfies the
environmental conditions and confirmed the receipt of all necessary federal
authorizations for these areas.
Pipelines: Maryland
Approves Application for Pipeline to Cross Potomac River
On March 16, 2018, the
Maryland Department of the Environment (MDE) approved Columbia Gas Transmission LLC’s (Columbia)
application to construct 3.06 miles of 8-inch pipeline in Maryland. The
pipeline, part of the Eastern
Panhandle Project,
will cross the Potomac River, a tributary to the Potomac, as well as other
creeks and tributaries in Washington County. Columbia will use horizontal
directional drilling and open-cut trenching in these operations. The purpose of
the project is to “increase natural gas supply options and system reliability
options, thereby reducing the risk of interruption.” MDE held hearings for the
project in December 2017 and January 2018. Hearings were attended by
approximately 300 people and MDE received over 2,400 written public comments.
Production and Operation:
U.S. Natural Gas Exports Surpass Imports
On
March 19, 2018, the U.S. Energy Information Administration (EIA) published information indicating that
the United States exported more natural gas than it imported in 2017. This is
the first time in the past 60 years that the U.S. has been a net natural gas
exporter. According to EIA, this change occurred as a result of a significant
increase in natural gas production, especially in the Appalachian region. In
addition, the U.S. has decreased pipeline imports from Canada and increased
exports by pipeline and liquefied natural gas.
"At Allegheny River's headwaters, treatment plant for fracking wastewater stirs debate" - PittsburghPG
"State says PES owes $3.8 billion in back taxes, urges court hold up bankruptcy plan" - State Impact
"Women in energy: Perspectives on gender balance" - The Stream
"More lawsuits flow against Mariner East construction" - Pittsburgh PG
"Wisconsin frac sand industry roars back, but new competition looms" - Lacrosse Tribune
"South Korean company signs on to build ethane cracker in Ohio" -Shale Gas Reporter
"City Declares A Frack-Out" - NewHaven Independent
"South Korea's SK Innovation To Buy US Shale Oil Company" - Oil and Gas Investor
"How Two Wells in Wyoming Explain the Natural-Gas Glut" - The Wall Street Journal
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Check out this week’s Shale Law in the Spotlight: Bayou Bridge Pipeline
Project - An Overview of the Current Legal Developments.
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