Sara Jenkins – Research
Assistant
Jackie Schweichler –
Staff Attorney
Brennan Weintraub –
Research Assistant
The following information is an update of recent local, state,
national and international legal developments relevant to shale gas.
Biofuels: Court of
Appeals Denies Request for Rehearing on Renewable Fuel Standard Exemptions
On April 7, 2020, the U.S.
Court of Appeals for the Tenth Circuit denied a request for rehearing from small oil refineries regarding renewable
fuel standard exemptions. (NCGA news release, Renewable Fuels Association v. EPA, No.
18-9533). The request was filed in response to a January 2020 ruling by the court that vacated the Environmental
Protection Agency’s (EPA) extension of renewable fuel standard exemptions to
three small oil refineries. (Jan. Order, pg. 99). EPA issued a news release stating that it planned to implement the court’s January decision
once all “appeals have been resolved and the court’s mandate has been
issued.” EPA also indicated that ensuring compliance of small refineries
was low on its priority list during the Covid-19 pandemic.
Infrastructure: West
Virginia Governor Signs Critical Infrastructure Protection Act
On March 25, 2020, West
Virginia Governor Jim Justice signed House Bill 4615, establishing protections for critical infrastructure. The bill creates criminal and civil penalties
for persons who “willfully and knowingly” trespass on property containing a
“critical infrastructure facility.” (pg. 5). Some critical infrastructure facilities
defined in the bill include petroleum refineries, natural gas compressor
stations, liquified natural gas terminals, and crude oil storage facilities.
(pg. 4). Misdemeanor violations include
entering the property without permission and could result in fines ranging from
$100 to $1,000, and/or up to a year in jail. (pg. 5). A felony occurs if damage to the property
exceeds $2,500, with penalties for a felony including fines up to $20,000. (pg.
6).
GHG Emissions: Court of
Appeals Rules EPA Improperly Issued Regulation Regarding Greenhouse
Gas-Producing Chemicals
On April 7, 2020, the U.S.
Court of Appeals for the District of Columbia Circuit ruled that the Environmental Protection Agency (EPA) improperly issued
a 2018 regulation regarding certain greenhouse gas-producing
chemicals. (Natural Resources Defense Council v. Wheeler, No.
18-1172). Previously in a 2015 regulation, EPA changed the status of hydrofluorocarbons
(HFCs) from acceptable to unacceptable for use in certain products. The
2015 regulation established that companies using ozone-depleting chemicals
could not replace those chemicals with HFCs. (Opinion pg. 6). The 2015
regulation also prevented companies already using HFCs as a replacement for
ozone-depleting chemicals from continuing to use them. (Opinion pg 6). In
a 2017 opinion, the Court of Appeals held that EPA could prevent manufacturers
from replacing ozone-depleting chemicals with HFC’s but that EPA did not have
authority to prevent manufacturers that had already made the switch from
continuing to use HFCs. (See, Mexichem Fluor, Inc., v. EPA, No.
15-1329). In response to the court’s
2017 opinion, EPA issued the 2018 regulation explaining they would stop
applying HFC restrictions altogether. See
“Protection of Stratospheric Ozone: Notification of Guidance and a
Stakeholder Meeting Concerning the Significant New Alternatives Policy (SNAP)
Program,” 83 Fed. Reg. 18,431, 18,432 (Apr. 27, 2018). (2020 opinion, pg. 7). The court ultimately held that EPA’s 2018
regulation was issued improperly, without using notice-and-comment
requirements. (2020 opinion, pg 27). Thus, the court vacated the 2018
regulation and remanded the decision back to EPA for further proceedings. (pg.
27).
Landowner Royalties:
Ohio District Court Grants Judgments for Chesapeake and Total in Royalties
Case
On March 30, 2020, the U.S.
District Court for the Northern District of Ohio granted summary judgements for Chesapeake Exploration and Total E&P
USA (Defendants) in an oil and gas royalties case. (Zehentbauer Family v.
Chesapeake Exploration, LLC, No. 4:15CV2449). Plaintiffs, a class of
landowners, filed suit alleging Defendants were not paying the full royalties
due under their oil and gas leases. (pg. 12). The Plaintiffs disputed the calculating method
used by Defendants in determining the royalties amounts and alleged Defendants
were passing improper post-production costs to the landowners. (pg. 12). The court ultimately agreed with Defendants’
interpretation of the leases royalty provisions, allowing deductions for
post-production costs. (pg. 36).
Pipelines: Court of
Appeals Agrees to Pause Appeals for Constitution Pipeline Water Quality
Disputes
On April 8, 2020, the U.S.
Court of Appeals for the Second Circuit ordered that appeals regarding the Constitution pipeline’s water quality
certificate will be held in abeyance. (New York State Dept. of Envtl.
Conservation v. FERC, No. 19-4338, and Holleran v. FERC, No.
20-487). The court stated that the
pending appeals would be held in abeyance until the Federal Energy Regulatory
Commission’s certificate of public convenience and necessity for the pipeline
expires on December 2, 2020. The court noted that reinstatement of the
appeals was possible if Petitioners notified the court of a change in
circumstances. The order follows
Williams’ cancellation of the Constitution pipeline project. According to Reuters, Williams announced the cancellation on February 24, 2020,
stating that returns for the project had diminished to where “further
development is no longer supported.”
From the National Oil & Gas Law Experts:
AGENCY PRESS
RELEASES—STATE/FEDERAL
Pennsylvania
Department of Energy Press Releases:
DEP Reaches Settlement with CNX for Erosion
and Sedimentation Violations at Well Sites in Greene and Washington Counties (Apr. 7, 2020)
U.S.
Department of Energy
Department of Energy Announces $30 Million for
Machine Learning and Artificial Intelligence Research (Apr. 8, 2020)
Remarks As Prepared by Secretary Brouillette
G20 Extraordinary Energy Ministers Meeting (Apr. 10, 2020)
U.S.
Environmental Protection Agency
EPA Settles Two Cases with Coleman Oil
Company, LLC, Stemming From 2017 Columbia River Oil Spill (Apr. 8, 2020)
STATE
ACTIONS—EXECUTIVE/LEGISLATIVE
Pennsylvania
Executive Agencies—Actions and Notices:
50 Pa.B. 2061 “Extension of National Discharge Pollutant
Elimination System General Permit for Discharges from Hydrostatic Testing of
Tanks and Pipelines” Notice (Apr. 11, 2020)
Pennsylvania
Legislature:
No actions Apr. 6 -13,
2020
FEDERAL
ACTIONS—EXECUTIVE/LEGISLATIVE
Federal
Executive Agencies—Actions and Notices:
Federal Energy
Regulatory Commission
85 FR 19471 “Alliance for Open Markets, BP Canada Energy Marketing Corp.,
Oasis Petroleum Marketing LLC and Tenaska Marketing Ventures v. Northern Border
Pipeline Company; Notice of Complaint” Notice (Apr. 7, 2020)
85 FR 19752 “Columbia Gas Transmission, LLC; Notice of Schedule for
Environmental Review of the Leach XPress Project Amendment” Notice (Apr.
8, 2020)
85 FR 19936 “Iroquois Gas Transmission System, L.P.; Notice of Schedule for
Environmental Review of the Enhancement by Compression Project” Notice
(Apr. 9, 2020)
85 FR 19938 “Tennessee Gas Pipeline Company, LLC and Southern Natural Gas
Company, LLC; Notice of Schedule for Environmental Review of the Evangeline
Pass Expansion Project” Notice (Apr. 9, 2020)
85 FR 20264 “ANR Pipeline Company; Notice of Request Under Blanket
Authorization” Notice (Apr. 10, 2020)
85 FR 20266 “ConocoPhillips Company, Shell Energy North America (US), L.P.,
XTO Energy Inc. v. Northern Border Pipeline Company; Notice of Complaint” Notice
(Apr. 10, 2020)
Land Management Bureau
85 FR 19954 “Agency Information Collection Activities; Oil and Gas Leasing:
National Petroleum Reserve - Alaska” Notice (Apr. 9, 2020)
House
Energy and Commerce Committee Actions:
No new actions Apr. 6 -
13, 2020
Senate
Energy and Natural Resources Committee Actions:
No new actions Apr. 6 -
13, 2020.
Follow us on Twitter at PSU Ag & Shale Law (@AgShaleLaw) to receive ShaleLaw HotLinks:
“Trump’s Oil Meeting: The Aftermath, Details, and Drama,” Energywire
“Trump’s Oil Meeting: The Aftermath, Details, and Drama,” Energywire
“Alberta’s $5.3 Billion Backing of Keystone XL
Signals Vulnerability of Canadian Oil,” InsideClimate
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