Shale Law Weekly Review - February 4, 2019

Written by:

Brennan Weintraub - Research Assistant

Jackie Schweichler - Staff Attorney

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

Pipelines: FERC Issues EIS for Northeast Supply Enhancement Project

On January 25, 2019, the Federal Energy Regulatory Commission (FERC) issued the final  environmental impact statement (EIS) for the Northeast Supply Enhancement Project (Project).  The EIS addresses the environmental effects of miles of pipeline located in Lancaster County, Pennsylvania; Middlesex and Monmouth Counties, New Jersey; and Queens and Richmond Counties, New York.  The EIS also evaluates several facilities and the effects of compressor stations located in Chester County, Pennsylvania and Somerset County, New Jersey.  FERC concluded that the project will result in some adverse environmental impacts that can be reduced to “less-than significant levels” provided the implementation of recommended mitigation measures.  The project is operated by Transcontinental Gas Pipeline Company, LLC and will provide natural gas to Brooklyn, Queens, Staten Island, and Long Island.  

PA Impact Fee: Pennsylvania Expected to See Increase in Impact Fee Collections for 2018

On January 24, 2019, the Pennsylvania Independent Fiscal Office released its estimate of state impact fee collections for 2018 and projected a total amount of $247 million.  The estimation indicates an overall increase of $37.4 million from the previous year. The report found that approximately $15.1 million of the increase was due to new wells, while the remaining $22.3 million consisted of outstanding payments from wells previously involved in litigation. Of the $247 million generated by the impact fee in 2018, the Office estimates that roughly $137 million will go to counties, municipalities, and the Housing Affordability and Rehabilitation Enhancement Fund.  The remaining funds will go to the Marcellus Legacy Fund, Commonwealth Agencies, and Conservation Districts/Commission.

GHG Emissions: Governor of New Mexico Issues Executive Order on Greenhouse Gas Emissions

On January 29, 2019, the Governor of New Mexico issued Executive Order 2019-003, which establishes a goal of reducing the state’s greenhouse gas emission levels by 45% during the twenty-five year period from 2005 to 2030. To achieve this goal, the order requires the creation of a Climate Change Task Force comprised of state agency heads, which will set emissions limits for pollutants and seek to reduce vehicle emissions, in particular. The order also requires that the Environment Department and Energy, Minerals, and Natural Resources Department jointly develop a program to reduce methane emissions from oil and gas activities in the state.

State Regulation: North Dakota Commission Alters Crude Oil Conditioning Requirements

On January 19, 2019, the Industrial Commission of North Dakota announced that it had amended crude oil conditioning requirements in the state. Notably, the amendments will alter the frequency of vapor pressure testing and the time of year in which such testing occurs. This, the Commission said, would improve the efficiency of testing while continuing to address concerns about safety and marketability of crude oil.

State Regulation: Colorado Supreme Court Denies Motion to Vacate Decision Regarding Proposed Oil and Gas Rule

On January 28, 2019, the Colorado Supreme Court denied a motion to vacate or reconsider and modify its decision in a case regarding a proposed rule the Colorado Oil and Gas Conservation Commission (Commission) declined to consider (Martinez v. Colorado Oil & Gas Conservation Commission, No. 2017SC297).  The plaintiffs are young residents of Colorado who petitioned the Commission to issue a rule that would suspend the issuance of hydraulic fracturing permits until it could be shown that the drilling process will not negatively impact human health and the environment.  The Colorado Supreme Court determined that the Commission properly declined the rulemaking under the Colorado Oil and Gas Conservation Act.  The plaintiffs filed a motion to vacate the decision in light of the order vacating the dissenting opinion of district court judge Laurie Booras.  The Colorado Supreme Court relied on and cited Judge Booras’s dissent in its decision.  Judge Booras’s dissent was vacated after the Colorado Commission on Judicial Discipline determined that the judge had engaged in activities undermining her “integrity, independence, and impartiality.”  A timeline and additional documents related to this case can be found here.

From the National Oil & Gas Law Experts:

George Bibikos, At the Well Weekly, (January 25, 2019)

Charles Sartain, Texas Court Addresses Bad Acts in a Lease Play, Energy and the Law (January 31, 2019)

Pennsylvania Legislation:

HB 178: would amend Oil and Gas Act to include a natural gas tax on unconventional operations. (Referred to House Environmental Resources and Energy - Jan. 28, 2019)

HB 187: would dedicate a portion of Pennsylvania’s impact fee to communities with impacts from pipelines  (Referred to House Environmental Resources and Energy - Jan. 28, 2019)

HB 247: would allow unconventional well bores to cross multiple units (Referred to House Environmental Resources and Energy - Jan. 28, 2019)

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

“Court weighs challenge to FERC on Mountain Valley” - Energywire

“Water is almost as precious as oil in the Permian Basin” - Yahoo

“Drillers are easing off the gas” - Wall Street Journal

“List of regulation rollbacks for oil, gas, and coal industry” - AP

“Atlantic Coast asks court to clear ‘permanent obstacle’” - Energywire

“Tough times for sand miners” - Hart Energy

“Texas oil production strong despite recent price drop” - Houston Chronicle

“Trump considers action to limit states’ ability to block pipelines” - Shale Gas Reporter

“N.J. governor pushes for broader ban in Delaware River Basin” - Energywire

“Oil trains make comeback as pipeline bottlenecks worsen” - Wall Street Journal

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This week we published one new Shale Law in the Spotlight article: Shale Law in the Spotlight – Atlantic Coast Pipeline: Overview of Litigation Regarding the Pipeline Construction (Part 3 of 3).

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