Sara Jenkins – Research Assistant
Chloe Marie - Research Specialist
Jackie Schweichler – Staff Attorney
Audry Thompson – Research Assistant
The following information is an update of recent local, state,
national and international legal developments relevant to shale gas.
Economic
Development: Pennsylvania Congress Approves Energy Manufacturing Tax
Credit
On
February 4, 2020, Pennsylvania’s House and Senate approved HB 1100, amending the 1971
Tax Reform Code and establishing a tax credit for natural gas “purchased
and used in manufacturing of petrochemicals or fertilizers.” The bill was sponsored by Representative Aaron
Kaufer as part of the “Energize PA Legislative Package.” According to the House co-sponsorship memoranda, the bill is “designed to
make Pennsylvania attractive to outside businesses, create family-sustaining
jobs and provide economic benefits to underserved regions.” The bill
would create a tax credit for manufacturers that use natural gas to produce
petrochemicals or fertilizers, invest up to $450 millions in the construction
of facilities, and create 800 full-time jobs for the construction and operation
of these facilities. Eligible
manufacturers would be entitled to a $0.47 tax credit per unit of natural gas
that is purchased and used for petrochemical or fertilizer manufacturing.
If companies are approved for the natural gas tax credit, they will be ineligible
for any other tax credits provided in HB 1100. The bill has not yet been signed by Governor
Wolf.
Hydraulic
Fracturing Bans: New York Governor Cuomo Announces Intention to Support Permanent
Hydraulic Fracturing Ban
On
January 22, 2020, New York Governor Andrew Cuomo issued a press release announcing his intention
to support legislation that would permanently ban hydraulic fracturing. According to the press release, New York has
been operating under a temporary hydraulic fracturing ban for the last five
years, which, according to the governor, has created a “hotbed for clean energy
and economic development investment” in the state. Governor Cuomo also highlighted the success of
the 76West
competition and investment from
businesses like Imperium3. If
passed, the legislation would “restrict the Department of Environmental
Conservation from . . . authoriz[ing] an applicant to drill, deepen, plug back
or convert wells that use high-volume hydraulic fracturing as a means to
complete . . . a well.”
LNG Exports: Department
of Energy Approves Texas Brownsville for LNG Exports to Non-Free Trade
Agreement Nations
On February 10, 2020,
the U.S. Department of Energy (DOE) issued an order granting Texas
LNG Brownsville LLC (Texas LNG) authorization to export liquified natural gas
to non-free trade agreement nations. DOE limited Texas LNG’s export term
to 20 years, with exports beginning “no later than seven years” from the date
of the order. Texas LNG
will be required to file all long-term contracts with DOE within 30 days of
their agreement. DOE also posted a list on the status of long-term LNG
export applications received as of January 8, 2020. Other export projects located in Brownsville
also were approved, including Annova LNG and Rio
Grande LNG. Texas LNG’s Port
of Brownsville export facility is scheduled to be completed by 2025 with the
capacity to produce two million tonnes of liquified natural gas per
annum.
Pipelines:
Canada’s Federal Court of Appeal Dismisses Legal Challenge to Trans Mountain
Pipeline Project
On
February 4, 2020, the Federal Court of Appeal in Canada dismissed applications for judicial
review of the Trans Mountain Pipeline Expansion Project. The federal
Cabinet first approved the project in November 2016, but the court later
determined that the environmental assessment for the project was “too narrow”
and that the Cabinet failed to comply with its duty to consult Indigenous peoples
(Tsleil-Wautuh
Nation v. Canada, 2018 FCA 153). The matter was then sent back to the
National Energy Board for review. The National Energy Board issued a
recommendation to approve the project, and the Cabinet again approved the
project in June 2019. According to the Federal Court of Appeal, the
decision dated June 18, 2019, approving the expansion project was reasonable (Coldwater et
al. v. Canada et al., 2020 FCA 34). The court stated that “... the
Government of Canada had remedied the flaws in consultation earlier identified
by this Court and had engaged in adequate and meaningful consultation with
Indigenous peoples.”
From the National Oil & Gas Law Experts:
Charles Sartain, Keeping Score
in Midstream Dedications in Bankruptcy: Midstreams 2, Producers 1 (Feb. 5, 2020)
U.S. Energy Information Agency, Natural gas
prices fall to lowest level since 2016, the lowest February prices in 20 years (Feb. 3, 2020)
AGENCY PRESS
RELEASES—STATE/FEDERAL
Pennsylvania
Department of Energy Press Releases:
No new releases Feb. 10–17,
2020.
U.S.
Department of Energy
President Trump
Intends to Nominate Mark W. Menezes to be U.S. Deputy Secretary of Energy (Feb. 13, 2020).
U.S.
Environmental Protection Agency
EPA Announces
$2.7 Billion for Infrastructure to Protect Surface Waters and Drinking Water (Feb. 12, 2020).
EPA, NFWF
Announce $2.4 Million for Projects to Improve Pennsylvania Streams and the
Chesapeake Bay
(Feb. 12, 2020).
STATE
ACTIONS—EXECUTIVE/LEGISLATIVE
Pennsylvania
Executive Agencies—Actions and Notices:
No actions Feb. 17,
2020.
Pennsylvania
Legislature:
The House will reconvene
on Monday, March 16, 2020 at 1:00PM
The Senate will
reconvene on Monday, March 16, 2020 at 1:00PM unless sooner recalled by the
Pres. Pro Temp.
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).
Environmental Protection
Agency
85 FR 7999 “Inventory of U.S. Greenhouse Gas Emissions and
Sinks: 1990-2018” Notice (February 12, 2020)
Federal Energy
Regulatory Commission
85 FR 7997 “Transcontinental Gas Pipe Line Company, LLC;
Notice of Application” Notice (February 12, 2020)
85 FR 7991 “Venture Global Delta LNG, LLC; Venture Global
Delta Express, LLC; Supplemental Notice of Intent for the Planned Delta LNG and
Delta Express Pipeline Project Request for Comments on Environmental Issues
Related to Project Modifications Under Consideration” Notice (February
12, 2020)
85 FR 7989 “Kinder Morgan Louisiana Pipeline LLC; Columbia
Gulf Transmission, LLC; Notice of Availability for the Proposed Acadiana
Project and the Louisiana XPress Project” Notice (February 12, 2020)
85 FR 7989 “BP Energy Company v. Natural Gas Pipeline
Company of America LLC; Notice of Complaint” Notice (February 12, 2020)
85 FR 7985 “Port Arthur Pipeline, LLC; Notice of Intent to
Prepare an Environmental Assessment for the Proposed Louisiana Connector
Amendment Project, Request for Comments on Environmental Issues, and Notice of
Public Scoping Session” Notice (February 12, 2020)
85 FR 8276 “National Fuel Gas Supply Corporation;
Transcontinental Gas Pipe Line Company, LLC; Notice of Availability of the
Environmental Assessment for the Proposed Fm100 and Leidy South Projects” Notice
(February 13, 2020)
85 FR 8271 “Texas Eastern Transmission, LP; Notice of
Intent to Prepare an Environmental Assessment for the Proposed Middlesex
Extension Project, Request for Comments on Environmental Issues, and Notice of
Public Scoping Session” Notice (February 13, 2020)
85 FR 8266 “Transcontinental Gas Pipe Line Company, LLC;
Notice of Application” Notice (February 13, 2020)
House
Energy and Commerce Committee Actions:
H.R. 5842 “To authorize the Administrator of the
Environmental Protection Agency to award grants to entities to participate in
decisions impacting the health and safety of their communities in connection
with the release of certain hazardous air pollutants and the permitting of
solid waste disposal facilities and hazardous waste facilities, and for other
purposes.” Referred to the House Committee on Energy and Commerce (Feb.
11, 2020).
H.R. 5857 “To ban the
practice of hydraulic fracturing, and for other purposes.” Referred to the
House Committee on Natural Resources, and in addition to the Committee on
Energy and Commerce, for a period to be subsequently determined by the Speaker,
in each case for consideration of such provisions as fall within the jurisdiction
of the committee concerned (Feb. 12, 2020).
Senate
Energy and Natural Resources Committee Actions:
S.3288 “A bill to provide for the protection of and
investment in certain Federal lands in the State of California” Read twice
and referred to the Committee on Energy and Natural Resources (February 12,
2020).
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