Shale Law Weekly Review - July 28, 2020

Written by:
Sara Jenkins – Research Assistant 
Jackie Schweichler – Staff Attorney
Kaela Gray – Research Assistant

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

Public Lands: Federal Court Vacates BLM Rule Revising Natural Gas Venting and Flaring Requirements
On July 15, 2020, the U.S. District Court for the Northern District of California vacated a Bureau of Land Management (BLM) rule that revised natural gas waste prevention requirements. (State of California v. Bernhardt, No. 4:18-cv-05712-YGR).  In 2016, BLM promulgated a rule (2016 rule) to “reduce waste of natural gas from venting, flaring, and leaks” on land with Federal and Indian leases.  In 2018, BLM issued a new rule (2018 rule) that revised and rescinded some of the regulations in the 2016 rule.  The District Court concluded that BLM’s rulemaking process for the 2018 rule was “wholly inadequate.”  The court found that BLM’s amended definition of “waste” in the 2018 rule was arbitrary.  The court also found that while engaging in the rulemaking process for the 2018 rule, BLM violated the Administrative Procedure Act and the National Environmental Policy Act.  The court ultimately vacated the 2018 rule, but it provided a 90-day grace period to give the parties time to determine their next steps in response to the court’s ruling. 

Pipelines: Louisiana Appellate Court Awards Damages to Landowners for Pipeline Violation of Due Process Rights 
On July 16, 2020, the Louisiana State Court of Appeal awarded damages to landowners after finding that their due process rights were violated by the Bayou Bridge Pipeline project. (Bayou Bridge Pipeline, LLC v. 38.00 Acres More or Less located in St. Martin Parish, No. CA 19-565). Bayou Bridge Pipeline, LLC (BBP) began construction of its pipeline on certain landowners’ property before being granted expropriation by the trial court.  Louisiana statute La.R.S. 19:8(A)(3) and Landowners’ property rights both required BBP to obtain permission to use the lands for public benefit before beginning construction.  Thus, the court found that BBP “willfully, wantonly, and recklessly” violated the landowners’ due process rights.  The court awarded damages to each landowner in the amount of $10,000 for BBP’s violation and remanded the case back to the trial court to award landowners’ attorney’s fees and expert witness costs. 

Labor Law: Department of Labor Issues Guidance on COVID-19 for Oil and Gas Workers 
On July 7, 2020, the U.S. Department of Labor's Occupational Safety and Health Administration (OSHA) issued guidance on COVID-19 to help protect workers in the oil and gas field. According to OSHA’s news release, the guidance includes information on how industry workers should perform work requiring close contact, implement 6-foot spacing environments, stagger work schedules, maintain good ventilation, etc.  The guidance lists specific sections of information for engineering controls, administrative controls, safe work practices, and personal protective equipment.  The guidance also includes examples of work tasks associated with exposure risk levels. 

Pipelines: Department of Interior Determines Andeavor/Tesoro Pipeline Has Been Trespassing on Indian Lands 
On July 2, 2020, the U.S. Department of the Interior’s Bureau of Indian Affairs (BIA) issued a Notification of Trespass Determination for the Andeavor/Tesoro Pipeline located across the Fort Berthold Indian Reservation in North Dakota.  According to the Notification, the pipeline’s right-of-way expired in 2013.  Because Andeavor/Tesoro failed to renew the right-of-way, the pipeline has been operating in trespass for seven years.  Federal regulation allows for the BIA to issue penalties for trespass on Tribal and BIA lands. (See 25 CFR § 166.801).  In the Notification, BIA issued a cease and desist order for the use of the pipeline.  BIA also included an assessment for total damages in the amount of $187,158,636.00 to be paid by Andeavor/Tesoro within 30 days of the receipt of the letter. 

Public Lands: U.S. Congress Passes Conservation Bill Involving Revenues from Oil and Gas Development on Federal Lands 
On July 24, 2020, the U.S. Congress presented a conservation bill to President Trump that involves the use of revenues from oil and gas development on federal lands.  The bill, H.R. 1957, is also known as the Great American Outdoors Act.  The bill passed the Senate by a vote of 73 to 25, and the House approved the Senate’s amendments in a 310 to 107 vote.  The bill establishes the National Parks and Public Land Legacy Restoration Fund, which will be funded by 50 percent of all “energy development revenues . . . from oil, gas, coal, or alternative or renewable energy development on Federal land.”  The fund is to be used for the maintenance of lands under the U.S. Forest Service, Bureau of Land Management, the National Wildlife Refuge System, and the Bureau of Indian Education schools, among other agencies. 

Methane Emissions: New Mexico Issues New Regulations for Natural Gas Emissions
On July 20, 2020, New Mexico released a draft of new regulations to curb natural gas emissions in the state.  The objective of the regulation is to reduce venting and flaring of natural gas from production sites to prevent waste and protect health.  The regulation’s definition of natural gas includes a “mixture of hydrocarbon compounds, primarily composed of methane.”  The draft does not allow flaring of natural gas during completion operations unless there is a risk to the safety of the operations.  Additionally, the draft includes a table of examples for statewide natural gas capture requirements.

From the National Oil & Gas Law Experts:
Charles Sartain, “Construction” of a Well Pad Requires More than a Survey (July 21, 2020).
John McFarland, Another Chapter in Jimmy McAllen’s Fight with Forest Oil (July 23, 2020).
John McFarland, TexNet is adding an earthquake monitoring station in Odessa (July 20, 2020).

AGENCY PRESS RELEASES—STATE/FEDERAL

Pennsylvania Department of Energy Press Releases:
No relevant releases July 20–27, 2020. 

U.S. Department of Energy
No relevant releases July 20–27, 2020.

U.S. Environmental Protection Agency
Department of Energy Announces Energy Incubator Prize and Funding Opportunity (July 20, 2020).

STATE ACTIONS—EXECUTIVE/LEGISLATIVE

Pennsylvania Executive Agencies—Actions and Notices: 
50 Pa.B. 3804 “Limited Suspension of Enforcement of the Commercial Fuel Oil Sulfur Content Limit Requirements for Combustion Units for Certain Distributors and Retail Outlets,” Department of Environmental Protection Notice (July 25, 2020).
50 Pa.B. 3714 “Revision of the Maximum Allowable Sulfur Content Limit for No. 2 and Lighter Commercial Fuel Oil,” Environmental Quality Board (july 25, 2020). 

Pennsylvania Legislature:
No relevant releases July 20–27, 2020.

FEDERAL ACTIONS—EXECUTIVE/LEGISLATIVE

Federal Executive Agencies—Actions and Notices: 
Environmental Protection Agency
85 FR 43706 “Deletion of the Hormigas Ground Water Plume Superfund Site” National Oil and Hazardous Substances Pollution Contingency Plan; National Priorities List— Rule (July 20, 2020).
Federal Energy Regulatory Commission 
85 FR 44291 “Freeport LNG Development, L.P.; FLNG Liquefaction, LLC; FLNG Liquefaction 2, LLC; FLNG Liquefaction 3, LLC; Noble Gas Project” Environmental Assessments; Availability, etc.— Notice (July 22, 2020).
85 FR 44295 “Request for Extension of Time Atlantic Coast Pipeline, LLC; Dominion Energy Transmission, Inc.” Notice (July 22, 2020).
85 FR 44873 “ANR Pipeline Co., Alberta Xpress Project; Great Lakes Transmission Limited Partnership, Lease Capacity Abandonment Project” Environmental Assessments; Availability, etc.— Notice (July 24, 2020). 
International Trade Administration
85 FR 44280 “Certain Oil Country Tubular Goods From India” Antidumping or Countervailing Duty Investigations, Orders, or Reviews— Notice (July 22, 2020).
National Oceanic and Atmospheric Administration
85 FR 43819 “Deepwater Horizon Oil Spill Louisiana Trustee Implementation Group Final Phase II Restoration Plan; Large-Scale Barataria Marsh Creation: Upper Barataria Component” Environmental Assessments; Availability, etc.— Notice (July 20, 2020).
Ocean Energy Management Bureau
85 FR 43875 “Gulf of Mexico Outer Continental Shelf Oil and Gas Region-wide Lease Sale 256” Oil and Gas Lease Sales— Notice (July 20, 2020).
Pipeline and Hazardous Material Safety Administration
85 FR 44477 “Safety of Underground Natural Gas Storage Facilities; Correction” Pipeline Safety—  Rule (July 23, 2020). 
85 FR 44994 “Liquefied Natural Gas by Rail” Hazardous Materials—  Rule (July 24, 2020). 

House Energy and Commerce Committee Actions:
No relevant actions July 20–27, 2020.

Senate Energy and Natural Resources Committee Actions: 
S.4311 “A bill to amend the Mineral Leasing Act to eliminate an administrative fee, and for other purposes” Read twice and referred to the Committee on Energy and Natural Resources (July 23, 2020).
S.4223 “A bill to amend the Mineral Leasing Act to ensure market competition in onshore oil and gas leasing, and for other purposes” Read twice and referred to the Committee on Energy and Natural Resources (July 20, 2020).

Follow us on Twitter at PSU Ag & Shale Law (@AgShaleLaw) to receive ShaleLaw HotLinks:
“Leaders Of #NoDAPL Movement Await Pipeline Shutdown,” Bismarck Tribune
“Pennsylvania Attorney General Josh Shapiro Promises More In Natural Gas Investigation,” Pittsburgh Business Times
“20 States Sue Over Trump Rule Limiting States from Blocking Pipeline Projects,” The Hill
“A Pipeline Is Quietly Ordered Shut in New Signal of Shale’s Woes,” Bloomberg
“Trump Proposes Speedier Environmental Reviews for Highways, Pipelines, Drilling and Mining,” Inside Climate News
“Coronavirus Surge, Renewed Lockdowns Fan Fresh Worries About Global Fuel Demand,” (Reuters)
“From NEPA to North Dakota, 4 Pipeline Fights to Watch,” EE News

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