The US Bureau of Land Management (BLM) recently asked the 10th Circuit to pause its review of an Obama-era rule on fracking. The rule, if implemented, would restrict fracking practices on federal and tribal lands. The move comes at a time when the BLM and other agencies are reconsidering their positions in light of the new administration.
Pennsylvania's environmental regulator recently addressed a potential link between a string of small local earthquakes and hydraulic fracturing in the Utica Shale. The state's Department of Environmental Protection stated that there was "a marked temporal/spatial relationship" between the microseismic events and fracking operations. It recommended that the owner change its method of stimulation and employ a more stringent reporting schedule for similar seismic events.
A Pennsylvania appellate court recently ruled that ongoing penalties are impermissible for a single waterway leak from fracking activities under the state's Clean Streams Law. The Pennsylvania Department of Environmental Protection argued that the law permitted larger, ongoing penalties for each day that the contamination remains in state waters; however, the court found that the law authorises punishing the entry of wastes into state waters, not its movement afterwards.
Senators have introduced a new bill for energy storage that extends the investment tax credit (ITC) for both grid-scale and residential energy storage systems. The Energy Storage Tax Incentive and Deployment Act garnered support from both the Democratic and Republican sides of the Senate. The new bill is modelled on the existing ITC policy for solar energy in a bid to open up competitive storage markets.
A recent earthquake has again sparked a debate regarding the alleged connection between hydraulic fracturing and seismic activity. The Oklahoma Corporation Commission issued an order to shut down wastewater disposal wells within a 500 square-mile radius of the earthquake's epicentre. On the recommendation of experts, Ohio has prohibited deep injection wells close to fault lines.
The Texas Supreme Court recently emphasised that the term 'nuisance' refers to a particular type of legal injury involving interference with the use and enjoyment of property. The court explained that a defendant may be liable for causing a condition that constitutes a nuisance based on intentional, negligent or strict liability theories. This latest clarification will be required authority for any brief or opinion on private nuisance law in Texas.
The new PIPES Act reauthorises the Pipeline and Hazardous Materials Safety Administration through 2019 and facilitates greater pipeline safety. The act requires a review of both natural gas and hazardous liquid integrity management programmes, and mandates the creation of a working group to consider the development of an information-sharing system related to integrity risk analyses.
The Environmental Protection Agency recently issued New Source Performance Standard Sub-part OOOOa, its climate change regulations for methane and volatile organic compound emissions for the oil and natural gas sector. Although the new rule applies only to newly and recently constructed, reconstructed or modified facilities, it may be a first step towards climate change regulations for older oil and gas sources.
The Department of Transportation's Pipeline and Hazardous Materials Administration (PHMSA) recently published in the Federal Register a notice of proposed rulemaking applicable to onshore gas transmission and gathering pipelines. The notice proposes several significant changes to the regulatory scheme for gathering lines, including bringing oversight of gathering lines that have traditionally escaped federal regulation under the PHMSA's jurisdiction.
A recent decision of the influential Bankruptcy Court for the Southern District of New York has attracted attention from – and caused concern for – owners of pipelines and other midstream assets, as well as lenders to midstream and upstream lenders across the United States. In this case, energy company Sabine was granted court approval allowing it to reject certain gas gathering and handling agreements under Section 365 of the Bankruptcy Code.
The US Department of Energy's Office of Fossil Energy recently issued the first authorisation to export natural gas from the United States to Canada and – after liquefaction in Canada – to re-export from Canada to countries lacking free trade agreements with the United States and requiring national treatment for trade in natural gas. The path is now paved for further integration of the US-Canadian natural gas and liquefied natural gas industries.
The Securities and Exchange Commission recently re-proposed rules requiring resource extraction issuers to disclose payments made to the US federal government or foreign governments for the commercial development of oil, natural gas and minerals. The proposed rules are mandated by the Dodd-Frank Wall Street Reform and Consumer Protection Act and are intended to improve transparency in the extractive industries.
The Federal Energy Regulatory Commission (FERC) recently clarified that the exemption from the buy/sell prohibition for natural gas asset management agreements set forth in Order 712 also applies to supply-side asset management agreements. FERC's clarification is important for holders of interstate capacity and asset managers and should provide more flexibility for parties to structure their asset management agreements and associated commodity transactions.
The Supreme Court recently opened the door for more exceptions to circumstances where federal regulation prevents application of state antitrust laws. In Oneok v Learjet the court held that the claims of natural gas purchasers under a state's antitrust laws were not barred by federal field pre-emption, even though the Federal Energy Regulatory Commission had authority to regulate the conduct that caused the damage.
The US Environmental Protection Agency (EPA) recently proposed new methane and volatile organic compound regulations under the Clean Air Act for the oil and natural gas sector. Specifically, the EPA is proposing expansive amendments to the new source performance standards for the oil and natural gas sector. The proposal addresses new, modified and reconstructed emissions sources across the entire sector.
The US Environmental Protection Agency recently issued its final Clean Power Plan, which establishes historic new standards and emission guidelines intended to reduce carbon pollution from power plants. The plan will affect power market participants across the generation base and will present significant compliance challenges, as well as market opportunities, should it ultimately survive expected legal challenges and come into force.
The Texas Supreme Court recently issued its first decision discussing its key 1996 ruling in Heritage Resources Inc v NationsBank. The decision, concerning overriding royalties on gas under the plaintiff's lease, reaffirmed the underlying premise of Heritage – that the specific lease language used by the parties controls the royalty valuation and deductibility of post-production costs.
In a joint initiative by the US Navy, Energy and Agriculture Departments, three contracts have been awarded for the construction and commission of 'drop-in' biofuel refineries to meet the transportation needs of the military and private sector. Initiatives such as this satisfy the United States' need to be an environmental leader while addressing national security concerns.
The Ohio Supreme Court has issued its long-awaited opinion in State ex rel Morrison v Beck Energy Corp. The court, in a divided opinion, held that Ohio's Home Rule Amendment does not allow a local municipality to enforce its own permitting scheme over and above the statewide permitting system adopted under Ohio Revised Code Chapter 1509.
The Texas Supreme Court recently handed down its decision in In re Deepwater Horizon, which arose out of the massive damages caused by the 2010 offshore well blowout in the Gulf of Mexico involving British Petroleum (BP) and its drilling contractor, Transocean. The issue was whether BP was entitled to $750 million in insurance proceeds as an additional insured under Transocean's liability policy – and the answer was no.