Shale Law in the Spotlight: Overview of the Greater Sage-Grouse Resource Management Plan Reform

Written by Chloe Marie – Research Fellow

The U.S. Fish & Wildlife Service (FWS) describes the Greater sage-grouse as a large, rounded-winged, ground-dwelling bird unique to North America. Historically, there have been concerns about the extent to which the sagebrush habitat of the Greater sage-grouse has been affected by oil and gas development and its associated infrastructure. In September 2015, however, FWS found that “the threats which caused the Service to initially designate the bird ‘warranted but precluded’ in 2010 had been significantly reduced due to federal and state land use conservation plans.” Therefore, the U.S. Department of Interior (DOI) announced in a Press Release that the Greater sage-grouse should no longer be protected under the Endangered Species Act, but DOI insisted on the need to continue to focus efforts on the Greater sage-grouse conservation measures when developing federal and state land management plans.

In this regard, the U.S. Bureau of Land Management (BLM) issued an Instruction Memorandum 2016-143 in December 2016 providing guidance on the implementation of the Greater sage-grouse Resource Management Plan. Instruction Manual 2016-143 draws particular attention to the objective of prioritizing oil and gas leasing and development outside of the Greater sage-grouse habitat management areas.

On December 27, 2017, the BLM released a new Instruction Manual 2018-026 replacing and superseding the prior Instruction Manual 2016-143 developed during the Obama administration. While stating that the new Instruction Manual continues to prioritize leasing outside of the Greater sage-grouse habitat, BLM also declared that applications for a lease outside of the Greater sage-grouse habitat management areas do not need to be considered before those within it. The new Instruction Manual points out that “this policy should allow for BLM to efficiently conduct lease sales and permit oil and gas development while still protecting [the Greater sage-grouse] and [the Greater sage-grouse habitat].”

More precisely, the new Instruction Manual emphasizes that certain leasing stipulations, such as No Surface Occupancy (NSO) and Controlled Surface Use (CSU), can be used as a way to promote leasing outside of Greater sage-grouse higher priority habitat management areas. In addition, BLM also prioritizes leasing applications based on “office workload capacity, first-in/first-out, priority for unit obligation wells, processing the easiest applications first, operator drilling plans, operator proposals for units, potential drainage cases, and other resource values that must be considered.”

Shale Gas Weekly Review – July 22, 2016

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

Independent Fiscal Office Expects Impact Fee Collections to Continue Declining in 2016

On July 15, 2016 the Pennsylvania Independent Fiscal Office (IFO) released a research brief entitled “Impact Fee Update and 2016 Outlook.” Impact fees collected by the Commonwealth are distributed among various programs throughout Pennsylvania, including local governments, environmental initiatives, and emergency services. These impact fee revenues decreased by $35.8 million in 2015 and, according to the IFO, this downward trend is likely to continue. All three scenarios presented by the IFO for 2016 show a decline in impact fee collections. In the first scenario, the current trend continues and the IFO predicts that impact fee revenues will decrease by $15.2 million. If there is an increase in drilling, the best case scenario, the estimated loss decreases to $5.4 million. In the worst case scenario, where there is a reduction in the fee schedule and the current trend regarding new wells continues, the IFO predicts that impact fee collections will decrease by $56.5 million.

Pennsylvania DEP Unveils Updated Version of its Interactive Mapping Tool for Oil and Gas Wells

In July 2016, the Pennsylvania Department of Environmental Protection (DEP) unveiled an updated interactive mapping tool for viewing conventional and unconventional oil and gas wells in Pennsylvania. Both non-producing and producing wells can be viewed on the updated map based on information the DEP has access to from permit applications, reports submitted by well operators, or authorization requests.

 

Stonehenge Appalachia LLC Agrees to $1.5 Million Penalty for DEP Violations

In a news release issued July 18, 2016, the Department of Environmental Protection announced that it entered into a Consent Order and Agreement with Stonehenge Appalachia. Stonehenge agreed to pay $1.5 million in civil penalties for environmental damage that the DEP attributed to the company. The environmental damage includes, according to the DEP, allowing sediment discharge to continue unchecked, causing a landslide and filling two wetlands, and contaminating Pennsylvania waters through directional drilling activities.

Study Looks at Connection Between Asthma and Natural Gas Development

In a study published July 18, 2016, researchers concluded that an association exists between asthma exacerbations and unconventional natural gas development (UNGD). The study included three types of exacerbations: new asthma medication orders (mild), emergency room visits (moderate), and hospitalization (severe). All three types of exacerbations were found to be more likely occur in patients residing near the highest levels of UNGD activity. The study stops short of concluding that the UNGD activity causes exacerbations, noting only an association exists between the two.

Texas Study Examines Correlation Between Seismicity Development and Earthquakes

On July 17, 2016, a study  called “Ellenburger Wastewater Injection and Seismicity in North Texas” was released in an online version of Physics of the Earth and Planetary Interiors. This study is a compilation and assessment of approximately 24,000 injection volume and pressure measurements for the Ellenburger Formation in Northern Texas. In this study, the authors concluded that there is “not only correlation but causation: lower formation compressibility and higher pressures generally develop at the same time and location where earthquakes occurred” in the Ellenburg Formation. Additionally, the authors used this data to develop preliminary forecasts for the Ellenburger Formation where seismicity will continue or develop and concluded that additional data would be required to predict and prevent seismic hazard more efficiently.

U.S. House of Representatives Votes on U.S. Department of Interior Appropriation Bill

On July 14, 2016, the U.S. House of Representatives voted 231 to 196 to pass HB 5538, a 2017 fiscal appropriations bill from the U.S. Department of the Interior. The bill is now in the U.S. Senate awaiting a vote. In its current form, provisions of HB 5538 would deny funds to implement and enforce several proposed federal regulations against the oil and gas industry.

Volume of Natural Gas Traded in U.S. Increases for the First Time Since 2011

In May, Cornerstone Research released a report regarding 2015 FERC Form 552 submissions. In 2015, the overall trading volume of natural gas increased by 4.1%, ending the downward trend that persisted from 2011 to 2014. Production of natural gas in the United States rose by 5% and the EIA predicts that it will continue to increase until 2040, with consumption increasing more slowly.

PHMSA Issues an Amended Corrective Action Order to Texas Eastern Transmission LP

On July 19, 2016, the Pipeline and Hazardous Materials Safety Administration (PHMSA) issued an Amended Corrective Action Order to Spectra Energy’s subsidiary Texas Eastern Transmission LP. This order followed an initial investigation by PHMSA into Texas Eastern Transmission LP’s natural gas pipeline, Line 27, that exploded on April 29, 2016, near Delmont, Pennsylvania. The preliminary investigation found that a pipeline that runs parallel to Line 27 “has shown a pattern of external corrosion with characteristics similar to the conditions that caused the failure on Line 27.” The amended corrective action order outlines fourteen mandatory corrective actions that Texas Eastern Transmission LP must make or the company will face civil penalties for failure to comply.

TransCanada Displays Commitment to Energy East Pipeline Project

On July 14, 2016, TransCanada signed a memorandum of understanding (MOU) with four labor unions, evidencing the company’s commitment to completing the Energy East Pipeline and employing over 14,000 Canadians during the nine years it will take to complete. The Energy East Pipeline will transport oil across Canada to the country’s eastern refineries.

Written by Chelsea Wilson and Jessica Deyoe - Research Assistants 

U.S. Department of Interior Settles with Environmental Defense Center Over an Offshore Hydraulic Fracturing Dispute

Recently, the U.S. Department of the Interior declared that it would perform an environmental impact assessment of hydraulic fracturing in the Pacific Ocean under the terms of a settlement it has reached with the Environmental Defense Center. The U.S. Department of the Interior also agreed to suspend new permit applications off the coast of California until the environmental effects of offshore hydraulic fracturing are better known. Existing offshore drilling permits, however, will remain intact.

This settlement decision resolves a claim for declaratory and injunctive relief filed by the Environmental Defense Center in March 2014 against the Bureau of Safety and Environmental Enforcement (BSEE) and the Bureau of Ocean Energy Management (BOEM). The Environmental Defense Center alleged that BSEE’s approval of 51 permits for well stimulation offshore California was unlawful under the National Environmental Policy Act (NEPA), the Administrative Procedure Act (APA), and the Outer Continental Shelf Lands Act (OCSLA).

In February 2015, the Center for Biological Diversity brought an action against BSEE and BOEM arguing that “the Bureaus have a pattern and practice of rubber-stamping permits to frack with no analysis of the environmental impacts, no determination of whether such activities are consistent with the plans governing oil development and production in the Pacific Region or California’s Coastal Management Program, and no public involvement.”

The environmental impact assessment is scheduled for completion by May 28, 2016.

Written by Chloe Marie - Research Fellow

02/08/2016

U.S. Department of Interior Cancels Federal Lease on Montana Tribal Lands

On November 23, 2015, the U.S. Department of Interior agreed to cancel the federal lease granting to Solenex Company the right to develop the oil and gas resources in the Lewis and Clark National Forest, Montana, and submitted a proposed schedule for the remainder of the proceedings.  

In 2013, Solenex Company filed a lawsuit in federal court against the U.S. Department of Interior challenging the action of the federal government to suspend its rights to drill a single exploratory gas well within the Badger-Two Medicine area. This area is located within the Lewis and Clark National Forest and is designated as a Traditional Cultural District under the National Register of Historic Places. The Department of Interior suspended the lease in 1985 due to concerns from the Blackfeet Tribe that such project will adversely affect the religious and cultural value of the area.

In July 2015, the U.S. District Court for the District of Columbia denied in part Solenex’s motion for summary judgment requesting the court to directly order the Department of Interior to lift the lease’s suspension; the court however left to the Department of Interior the decision whether to lift the suspension or continue the leasing process.

The U.S. Department of Interior anticipated the leasing cancellation “as early as December 11, 2015, or as soon thereafter as the Court approves the proposed schedule.”

More information on this case is available at docket no. 1:13-cv-00993.

This is an update of the blog post dated from September 24, 2015.

Written by Chloe Marie - Research Fellow

11/24/2015