Monday, August 10, 2020

Shale Law Weekly Review - August 10, 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.

Air Quality: Colorado Court Dismisses Lawsuit Challenging Amended Air Emissions Regulation Affecting Oil and Gas Producers
On July 29, 2020, a Colorado District Court dismissed a lawsuit challenging an amended air emissions regulation that affected oil and gas producers. (Board of County Comm’rs of Weld County Colorado v. Ryan, No. 20CV31022).  In December 2019, the Colorado Air Quality Control Commission (Commission) approved changes to State Regulation No. 7, which consists of amended air quality standards for reducing emissions.  Weld County filed suit alleging that the Commission violated state statutes when it failed to give Weld County’s requests, evidence, and recommendations priority before adopting the regulation.  Weld County also claimed that it would be injured through lost tax revenue if oil and gas companies moved locations due to the amended regulation.  The court, however, held that Weld County’s claims failed to meet the required burden to establish standing for judicial review.  The court found that injuries resulting from relocated oil and gas producers were “indirect and incidental.”  The court also held that Weld County’s claimed injuries did not implicate a legally protected right.  The court ultimately granted the Commission’s Motion to Dismiss the case for lack of standing. 

Pipelines: Forest Service Issues Notice for Supplemental EIS on Mountain Valley Pipeline 
On July 30, 2020, the U.S. Forest Service issued a notice of intent to prepare a supplemental environmental impact statement (SEIS) for the Mountain Valley Pipeline (MVP) and Equitrans Expansion Project. (85 FR 45863).  MVP construction is planned to cross 3.5 miles of the Jefferson National Forest.  The Equitrans project, according to its website, is expected to transport up to 600,000 dekatherms of natural gas per day from the Appalachian Basin to Mid-Atlantic and southeastern states, and it will connect to the proposed MVP.  The SEIS will supplement a prior environmental impact statement issued by the Federal Energy Regulatory Commission and adopted by the Forest Service.  The SEIS is needed to apply Forest Service Planning Rule requirements to soil resources, water, botanical threatened and endangered species, and scenic integrity.  A draft ESIS is expected to be available to the public by September 2020.

Pipelines: FERC Issues Notice on Environmental Assessment for Proposed PennEast Pipeline Amendment Project
On August 7, 2020, the Federal Energy Regulatory Commission (FERC) issued a notice of availability on the Environmental Assessment (EA) for the proposed PennEast pipeline amendment project. (85 FR 47960).  PennEast proposed to amend its certificate of public convenience and necessity that was issued by FERC in 2018.  The PennEast 2020 Amendment Project seeks to carry out the previously approved project in two phases.  Phase one would complete construction of pipeline facilities in Pennsylvania, resulting in 650,000 dekatherms per day of gas transportation.  Phase 2 would consist of building facilities in New Jersey after PennEast has obtained construction authorizations from the state.  FERC concluded that PennEast’s Amendment proposal “would not constitute a major federal action significantly affecting the quality of the human environment.” 

Pipelines: D.C. Court of Appeals Stays Injunction on Dakota Access Pipeline Shutdown 
On August 5, 2020, the U.S. Court of Appeals for the District of Columbia stayed an injunction that required the shutdown and emptying of the Dakota Access Pipeline. (Standing Rock Sioux Tribe v. U.S. Army Corps of Engineers, No. 20-5197).  Previously, on July 6, 2020, the U.S. District Court for the District of Columbia ordered that the Dakota Access Pipeline be emptied and shut down within 30 days. (district court case No. 16-1534, p. 24).  Then, on July 9, 2020, the district court denied an emergency motion to stay the court’s July 6th shutdown order, stating that it did not see a basis to grant a stay.  Following the U.S. Army Corps of Engineers’ Notice of Appeal, the Court of Appeals granted an administrative stay of the shutdown order to give it more time to consider the emergency motion for stay.  Ultimately, the Court of Appeals dissolved their administrative stay and stayed the district court injunction, finding that “the district court did not make the findings necessary for injunctive relief.” 

Federal Lands: Federal Court Denies Motion to Enforce Judgment to Reinstate 2016 Royalty Rule
On July 30, 2020, the U.S. District Court for the District of California denied a Motion to Enforce a judgment to reinstate the 2016 federal royalty rule (2016 rule). (State of California v. U.S. Dep’t of the Interior, No. C 17-5948 SBA).  The State of California and the State of New Mexico filed suit against the U.S. Office of Natural Resources Revenue (ONRR) after it repealed the 2016 rule regarding payments of oil and gas royalties on federal and Indian lands.  The court previously ruled that ONRR’s repeal of the 2016 rule was a violation of the Administrative Procedure Act and entered judgement reinstating the rule.  Conservation groups then intervened in the case and filed a motion to enforce the judgment.  The Magistrate Judge recommended denying the Motion to Enforce Judgment, and the court accepted his recommendation agreeing that enforcement is “beyond the scope of the Court’s prior Order” and that a new lawsuit is the appropriate way to challenge ONRR’s application of the judgment. 

Federal Lands: Appeals Court Dismisses Lawsuit Regarding 2016 Federal Royalties Rule
On August 5, 2020, the U.S. Court of Appeals for the Tenth Circuit dismissed a lawsuit challenging a 2016 federal royalties rule (2016 rule). (American Petroleum Institute v. United States Dept. Interior, No. 18-8070). The 2016 rule amended civil penalties under the Federal Oil and Gas Royalty Management Act.  The American Petroleum Institute (API) filed suit against the Office of Natural Resources Revenue (ONRR) alleging that the ONRR exceeded its authority in issuing the 2016 rule.  Ultimately, the court held that API lacked standing to file suit and remanded the case back to district court for dismissal.  The court found that API did not demonstrate a “sufficiently imminent threat of injury” needed to establish standing in the case. 

From the National Oil & Gas Law Experts:
Charles Sartain, Partition Agreement Outweighs Coal Surface Destruction Test (August 7, 2020).
Augusta Wilson, Climate Change And Covid-19: The Denial Playbook Is The Same (July 20, 2020). 

AGENCY PRESS RELEASES—STATE/FEDERAL

Pennsylvania Department of Energy Press Releases:
Learn How Pennsylvania Will Fight Climate Change with the Regional Greenhouse Gas Initiative (August 3, 2020). 

U.S. Department of Energy
Department of Energy Announces $33 Million for Natural Gas Pipeline Retrofitting Projects (August 6, 2020). 
Mark W. Menezes Confirmed by the U.S. Senate to be Deputy Secretary of Energy (August 4, 2020). 
Trump Administration Releases Policy Extending LNG Export Term to 2050 (July 29, 2020). 

U.S. Environmental Protection Agency
No relevant releases July 29-August 10

STATE ACTIONS—EXECUTIVE/LEGISLATIVE

Pennsylvania Executive Agencies—Actions and Notices: 
50 Pa.B. 4112 “2021 Schedule of Filing Dates for Recovery of Purchased Gas Costs; Doc. No. L-00840102” Pennsylvania Public Utility Commission- Notice (August 8, 2020). 

Pennsylvania Legislature:
No relevant releases July 31-August 10

FEDERAL ACTIONS—EXECUTIVE/LEGISLATIVE

Federal Executive Agencies—Actions and Notices: 
Energy Department
85 FR 7672 “Extending Natural Gas Export Authorizations to Non-Free Trade Agreement Countries Through the Year 2050” Proposed Rule—Comment Period (February 11, 2020). 
Federal Energy Regulatory Commission 
85 FR 47960 “Environmental Assessments; Availability, etc.: PennEast Pipeline Co., LLC” Notice (August 7, 2020). 
Land Management Bureau
85 FR 47985 “Proposed Reinstatement of Terminated Oil and Gas Lease: NMNM 137444, New Mexico” Notice (August 7, 2020). 
National Oceanic and Atmospheric Administration
85 FR 47190 “Deepwater Horizon Oil Spill Louisiana Trustee Implementation Group Final Restoration Plan; Living Coastal and Marine Resources, Marine Mammals and Oysters,” Environmental Impact Statements; Availability, etc. - Notice (August 4, 2020). 
Office of Natural Resources Revenue
85 FR 47240 “Additional Royalty Payments on Indian Gas Production in Designated Areas That Are Not Associated With an Index Zone” Major Portion Prices and Due Date - Notice (August 4, 2020). 
Presidential Documents
85 FR 46997 “NuStar Logistics, L.P.; Authorization To Construct, Connect, Operate, and Maintain Pipeline Facilities at the U.S.-Mexico International Boundary (Permit of July 29, 2020)” Administrative Order- Presidential Permit (August 3, 2020). 
85 FR 47001 “NuStar Logistics, L.P.; Authorization To Operate and Maintain Existing Pipeline Facilities at the U.S.-Mexico International Boundary (Permit of July 29, 2020)” Administrative Order- Presidential Permit (August 3, 2020). 
85 FR 47005 “TransCanada Keystone Pipeline, L.P.; Authorization To Operate and Maintain Existing Pipeline Facilities at the U.S.-Canada International Boundary (Permit of July 29, 2020)” Administrative Order- Presidential Permit (August 3, 2020). 

House Energy and Commerce Committee Actions: 
 H.R.7878 “To bolster evaluation procedures in consideration of interstate natural gas pipelines in relation to National Scenic Trails, and for other purposes” Referred to the House Committee on Energy and Commerce (July 30, 2020).

Senate Energy and Natural Resources Committee Actions: 
No relevant releases July 29-August 10

Follow us on Twitter at PSU Ag & Shale Law (@AgShaleLaw) to receive ShaleLaw HotLinks:
“Mountain Valley Pipeline On Track For 2021 Completion,” Reuters
“Chester County Appoints New Law Firm To Fight Pipeline,” Daily Local News
“BP To Cut Oil And Gas Production By 40% Over 10 Years,” Houston Chronicle 
“Oil And Gas Stakeholders Back Plan For Plugging West Virginia's Orphaned Wells,” West Virginia News
“Liberty Utilities Drops Plans For Major Gas Pipeline In N.H.,” NHPR
“Trump Allows Keystone Pipeline to Boost Canadian Oil Capacity after Expansion Stalls,” Hart Energy 
“DAPL Doubts Put Bakken Shale Reboot on Hold,” Hart Energy
“As Natural Gas Bans Go National, Can Cities Fill The Gap?,” EE News

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