Written by:
Sara Jenkins -
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.
Federal Lands: Department
of Interior Issues Guidance on the Recalculation of Royalties Following
Reinstatement of 2016 Rule
On June 13, 2019, U.S.
Department of the Interior’s Office of Natural Resources Revenue (ONRR) issued
a letter explaining that all federal oil and gas lessees, along with
federal and Indian coal lessees, must recalculate royalty payments from January
1, 2017, to the present. The letter follows a ruling by the U.S. District Court for the Northern District of California,
which vacated ONRR’s repeal of a 2016 rule titled, Consolidated Federal Oil & Gas and Federal &
Indian Coal Valuation Reform (2016 rule). The District Court’s action
reinstated the 2016 rule, creating a need for federal lessees to recalculate
royalties under the 2016 rule. ONRR is offering resources including letters,
trainings, and royalty valuation guidance to help support lessees with the
transition back to the 2016 rule.
Pipelines:
Pennsylvania’s Public Utility Commission Seeks Comment on Pipeline Rulemakings
On June 13, 2017, the
Pennsylvania Public Utility Commission (PUC) announced that it was seeking comment on rulemaking proposals regarding
pipeline safety regulations and pipeline utility financial reporting. PUC is
seeking public comments on an Advance Notice of Proposed Rulemaking Order to more “comprehensively regulate the design,
construction, operations and maintenance of public utilities transporting
petroleum products.” The order states that PUC follows federal minimum pipeline
safety requirements but that it may adopt more stringent standards. PUC also is
seeking public comments on another Notice of Proposed Rulemaking Order, which seeks to require public utilities
providing pipeline transport of oil and gas to file annual reports on
depreciation, service life studies, and capital investment plans. Currently,
PUC’s reporting requirements apply only to electric, gas, and water service
public utilities.
International Development/Pipelines: Canada Announces Approval of Transmountain Pipeline Expansion Project
On June 18, 2019, Canadian
Prime Minister Justin Trudeau announced government approval for the Trans Mountain pipeline expansion
project (project). The
government based its decision on a plan to bridge the gap between present and
future energy development as well as a plan to create a strategy for reaching
the global market. Trudeau explained that money earned from the project,
including tax revenue and possible sale of the pipeline, would be invested into
Canada’s clean energy transition. Trudeau also addressed concerns from indigenous
groups, stating that the government would be open to input from the groups on
how they could benefit from the project, including equity stakes and revenue
sharing. The project is expected to cost $7.4 billion CAD and increase the
transport capacity of the pipeline from 300,000 barrels of oil per day to
890,000 barrels per day.
From the National Oil
& Gas Law Experts:
Dena Adler, Jessica
Wentz, and Romany Webb, Four Important Points About EPA’s Affordable Clean Energy
Rule, (June 20, 2019)
Pennsylvania
Legislation:
HB 1557: would amend the Coal Refuse Disposal Control Act, designating
areas where coal refuse disposal is prohibited (Re-reported as committed - June 19, 2019)
HB1635: would provide legislative framework specific to conventional
oil and gas drillers to assist family owned operations (Referred to Environmental Resources and Energy - June 14, 2019)
HB1649: would require additional reporting requirements for
unconventional natural gas well operators (Referred to Environmental Resources and Energy - June 18, 2019)
SB258: would mandate that public utilities transporting natural gas
must identify high consequence areas and emergency operating procedures (First consideration - June 19, 2019)
SB284: would require pipeline operators to provide Emergency Response
Plans to the Public Utility Commission (First consideration - June 19, 2019)
HB247: would allow well bores to cross multiple units so long as the
operator has the right to drill wells on those units (Laid on the table and Removed from table - June 20, 2019)
“Democrats want companies to disclose their climate risks
- and fossil fuel industry is worried” - Politico
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This week we published
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Hydraulic Fracturing Bans.
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