Monday, July 29, 2019

Shale Law Weekly Review - July 29, 2019

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.

Production and Operation: Pennsylvania Court Upholds Most, But Not All, Unconventional Well Regulations
On July 22, 2019, the Pennsylvania Commonwealth Court upheld most of Pennsylvania’s unconventional well regulations while also ruling that one regulation was void and unenforceable (Marcellus Shale Coal. v. Dep’t of Envtl. Prot. of Pennsylvania, No. 573 M.D. 2016, 86-88). The unconventional well regulations found in Title 25, Chapter 78a of the Pennsylvania Code were promulgated in October 2016. The Marcellus Shale Coalition (Coalition) then filed suit against Pennsylvania’s Department of Environmental Protection and Environmental Quality Board requesting that the regulations be found invalid. Ultimately, the court ruled that it would deny most of the Coalition’s request by upholding sections of the unconventional well regulations regarding area of review, on-site processing, well development, centralized impoundments, spill remediation, and waste reporting. However, with regard to the regulation involving well site restoration, section 78a.65(b), the court granted summary relief to the Coalition, declaring the regulation to be void and unenforceable “to the extent that it requires post-drilling site restoration within the statutory 9-month period to [approximate original conditions].” 

GHG Emissions: Federal Court Sends Case Back to Rhode Island State Court in Climate Change Lawsuit Against Oil Companies 
On July 22, 2019, the United States District Court for the District of Rhode Island ruled it did not have jurisdiction to hear a climate change lawsuit that the State of Rhode Island filed against several large oil and gas companies including ExxonMobil Corp., Chevron Corp., Royal Dutch Shell, and others (Rhode Island v. Chevron Corp., No. 18-395 WES). The defendant oil companies removed the case to federal court claiming federal question jurisdiction. Under 28 U.S.C. § 1441, defendants can “remove” or change venue from state court to federal court if they believe the causes of action stated in the complaint should be governed by federal law. After some discussion of the impacts that oil companies have had on climate change, the district court ultimately found that the defendants did not show a federal question existed in the state’s claims. In the Order, Judge William E. Smith cited to Grable & Sons Metal Prods., Inc. v. Darue Eng’g & Mfg., finding the “defendants have not pointed to a specific issue of federal law that must necessarily be resolved to adjudicate the state law claims and instead mostly gesture to federal law and federal concerns in a generalized way.” The case will be sent back to state court after giving the defendants time to prepare new briefs. 

Pipelines: Native American Tribe Files Lawsuit Against Enbridge for Removal of Pipeline 
On July 23, 2019, the Bad River Band of the Lake Superior Tribe of Chippewa Indians (Band) filed a Complaint in the District Court for the Western District of Wisconsin against Enbridge Inc. and partners (Enbridge) for removal of a pipeline across reservation land (Bad River Band v. Enbridge Inc., No. 3:19-cv-602). According to the Complaint, the Enbridge pipeline (Line 5) was installed on the Band’s Reservation in 1953 from an easement issued by the Bureau of Indian Affairs. The Band claims that Enbridge has continued to operate the pipeline despite the easement for the pipeline expiring in 2013. Further, the Band describes environmental impacts the pipeline could have on nearby wetlands and ecosystems in case of a leak or failure. Ultimately, the Band has requested that the court declare Enbridge’s use of Line 5 a “public nuisance and a trespass,” and seeks the issuance of an injunction ending operations and requiring Line 5 removal.  

Pipelines: North Dakota Files Lawsuit Against the United States for Damages Caused by Dakota Access Pipeline Protestors on Federal Lands 
On July 18, 2019, the state of North Dakota filed a Complaint in the U.S. District Court for the District of North Dakota against the United States for damages caused by Dakota Access Pipeline protestors on federal lands (North Dakota v. United States, No.1:19-cv-00150-DLH-CRH). North Dakota is requesting damages in the amount of $38 million under the Federal Tort Claims Act for various allegations including public nuisance, gross negligence, and civil trespass (p. 1). According to the Complaint, protestors left “noxious waste, garbage, and debris” at camps near the pipeline site “to be cleaned up by the State at considerable cost.” Additionally, the Complaint states that protesters contributed to expenses incurred by state and local law enforcement who responded to “violent and illegal activity,” resulting in 761 arrests. By rule, the United States has 60 days to file a response to the allegations in the Complaint (Fed. R. Civ. P. 12(a)(2)).

From the National Oil & Gas Law Experts:
George Bibikos, At the Well Weekly, (July 19, 2019)

Paul Wight, Stephen Hug, & Josh Robichaud, FERC Revises Market-Based Rate Seller Requirements, (July 22, 2019)

John McFarland, Flaring in the Permian, (July 29, 2019)

Pennsylvania Legislation:
HB 1735: Creates the Pipeline Early Detection and Warning Board. Fees collected by the board would be issued as grants to municipalities for the purpose of developing warning systems to alert residents of a pipeline incident (Referred to Environmental Resources and Energy - July 24, 2019).

HB 1727: Amends Title 66 of the Pennsylvania Consolidated Statutes to require the use of fiber optics for mitigating risks of pipelines and for alerting personnel in a pipeline emergency  (Referred to Consumer Affairs - July 24, 2019)

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