Shale Law Weekly Review – September 25, 2020

Pipelines: Court Orders Additional Briefing on Continued Operation of Dakota Access Pipeline
On September 11, 2020, U.S. District Court for the District of Columbia issued an order requesting additional briefing to be submitted to it in Standing Rock Sioux Tribe v. U.S. Army Corps of Engineers. (Case Number 16-1534 (JEB)).  The parties’ additional briefs will assist the court in determining whether it should issue an injunction preventing the Dakota Access pipeline, spanning 1,272 miles, from operating.  In the order, the district court denied the U.S. Army Corps’ request to pause the litigation while the Corps decides whether to allow the pipeline to continue operating, a decision expected to be made by the agency in mid-October.  The Dakota Access Pipeline was previously enjoined from operating by an injunction issued by the court on July 6, 2020.  That injunction was stayed by the Court of Appeals for the D.C. Circuit because the appeals court determined that the lower court had not made the findings required to empty the oil from the pipeline and shut it down.

Pipelines: Sunoco Ordered to Reroute Portion of Mariner East II Pipeline Following Spill
On September 11, 2020, Pennsylvania Department of Environmental Protection issued an administrative order directing Sunoco Pipeline, L.P. to reroute a portion of the Mariner East II pipeline under construction in Chester County, Pennsylvania.  The order follows the Department’s Notice of Violation issued to Sunoco after 8,000 gallons of drilling fluid, considered an industrial waste product, was released near wetlands by Marsh Creek Lake. Sunoco was directed to utilize an alternative route about a mile north of the current construction site and has thirty days to appeal the Department’s order.

GHG Emissions: Pennsylvania Environmental Quality Board Approves Draft Rule Limiting Carbon Emissions to Address Climate Change
On September 15, 2020, the Pennsylvania Environmental Quality Board voted to approve a draft rulemaking which would limit carbon emitted from power plants in the Commonwealth.  The regulation comes in response to Governor Tom Wolf’s Executive Order (2019-07) directing the Pennsylvania Department of Environmental Protection to promulgate rules to reduce carbon emissions from power plants powered by fossil fuels and be compatible with other Northeastern states’ regulations in order to allow participation in the Regional Greenhouse Gas Initiative (RGGI).  The RGGI is currently comprised of 10 states using a market-based cap-and-trade system to reduce emissions which contribute to climate change.  The comment period for the proposed rule ends November 30, 2020.

Methane Emissions: Court Halts Implementation of Rule Modifying Emissions Standards
On September 15, 2020, the U.S. Courts of Appeals for the District of Columbia Circuit issued an administrative stay effectively halting regulatory actions that would modify emissions standards applicable to oil and natural gas producers.  The order was issued to allow the court to consider the merits of the motion and the Petition for Review filed on September 14, 2020 (Docket Number 20-1359, consolidated with 20-1357).  The petition challenges the Environmental Protection Agency’s final rule published at 85 Fed. Reg. 57,081 (Sept. 14, 2020), Oil and Natural Gas Sector: Emission Standards for New, Reconstructed, and Modified Sources Review, which was to become effective on September 14, 2020.

Biofuels: EPA Denies Sixty-Eight Small Refinery Exemptions to Renewable Fuel Standard
On September 14, 2020, the U.S. Environmental Protection Agency (EPA) announced its denial of sixty-eight pending small refinery exemption (SRE) petitions requesting relief from Renewable Fuel Standard (RFS) blending compliance for 2011–2018.  The EPA decision follows the Tenth Circuit Court of Appeals’ January 24, 2020, ruling in Renewable Fuels Assn. v. EPA, holding that EPA’s grant of economic hardship exemptions, rather than statutory-authorized extensions, exceeded EPA’s legal authority.  Refiners filed sixty-eight petitions seeking, in various ways, to backfill their previous history of exemptions with new EPA grants of retroactive extensions.  Noting that several of the petitions alleging hardship date back to 2011, EPA stated that “it seems unlikely that Congress contemplated or intended to allow a small refinery to obtain hardship relief through submitting a petition in calendar year 2020 for RFS compliance year 2011.”
See also “Court of Appeals Invalidates EPA Grant of Renewable Fuel Standard Waivers,” Agricultural Law Weekly Review—January 30, 2020, “Court of Appeals Denies Request for Rehearing on Renewable Fuel Standard Exemptions,” Shale Law Weekly Review—April 14, 2020.

From the National Oil & Gas Law Experts:
Charles Sartain, How Will the Texas Railroad Commission Address Gas Flaring? (September 15, 2020).
Stephen Boone, Niki Roberts, and Katherine Raymond, Silica Sand Mining (September 2020).
Michael Burger and Hillary Aidun, Pipeline Decisions Do Not Spell Doom For Transmission (September 15, 2020).

Agency Press Releases – State/Federal 

Pennsylvania Department of Environmental Protection:
DEP releases 2019 Oil and Gas Annual Report, (September 14, 2020)
Environmental Quality Board Approves Proposed Climate Change Regulation, (September 15, 2020)
U.S. Department of Energy:
DOE Announces $24 Million for Commercial Scaling of Battery and Methane Detection Technologies, (September 16, 2020)
U.S. Environmental Protection Agency:
EPA finalizes first ever rule to promote transparency in developing regulatory guidance documents, (September 14, 2020)
EPA Takes Action to Protect Integrity of the Renewable Fuel Standard Program, Support American Farmers, (September 14, 2020)

State Actions – Executive/Legislative

Pennsylvania Legislature:
HB 2025 “An Act authorizing the Department of Environmental Protection to conduct a public comment process on and submit to the General Assembly a measure or action intended to abate, control or limit carbon dioxide emissions by imposing a revenue-generating tax or fee on carbon dioxide emissions.” Presented to the Governor (September 16, 2020).

Federal Actions – Executive/Legislative

Federal Executive Agencies—Actions and Notices:
Environmental Protection Agency
85 FR 57018 “Oil and Natural Gas Sector: Emission Standards for New, Reconstructed, and Modified Sources Review” Final rule (September 14, 2020)
85 FR 57398 “Oil and Natural Gas Sector: Emission Standards for New, Reconstructed, and Modified Sources Reconsideration” Final rule (September 15, 2020)
Federal Energy Regulatory Commission
85 FR 56597 “Commission Information Collections Activities (Ferc Form Nos. 2 And 2-A); Comment Request; Extension; Errata Notice” Errata notice for information collections and request for comments (September 14, 2020).
85 FR 56598 “North Baja Pipeline, LLC; Notice of Availability of the Environmental Assessment for the Proposed North Baja Xpress Project” Notice (September 14, 2020).
85 FR 56595 “PennEast Pipeline Company, LLC; Notice of Petition for Declaratory Order” Notice (September 14, 2020).
85 FR 57204 “Transcontinental Gas Pipe Line Company, LLC; Notice of Request for Extension of Time” Notice (September 15, 2020)
Department of Energy
85 FR 58347 “Golden Pass LNG Terminal LLC; Application for Limited Amendment to Long-Term Authorization to Export Liquefied Natural Gas to Non-Free Trade Agreement Countries” Notice of application (September 18, 2020).
U.S. Army Corps of Engineers
85 FR 57298 “Proposal To Reissue and Modify Nationwide Permits” Notice of proposed rulemaking (September 15, 2020).

House Energy and Commerce Committee Actions:
H.R. 4447 Expanding Access to Sustainable Energy Act of 2019 “This bill requires the Department of Energy to award grants to assist rural electric cooperatives with identifying, evaluating, designing, and demonstrating energy storage and microgrid projects that utilize energy from renewable energy sources.” Placed on the Union calendar (September 15, 2020).

Senate Energy and Natural Resources Committee:
S. 180 “A bill to streamline the oil and gas permitting process and to recognize fee ownership for certain oil and gas drilling or spacing units, and for other purposes.” “Committee on Energy and Natural Resources Subcommittee on Public Lands, Forests, and Mining. Hearings held” (September 16, 2020).

Follow us on Twitter at PSU Ag & Shale Law (@AgShaleLaw) to receive ShaleLaw HotLinks:
“Natural Gas Production In Pennsylvania Hits Record High” State Impact Pennsylvania
“Dakota Access Oil Pipe Likely Safe From Shutdown Through 2020” BNN Bloomberg
“Friction Growing Within OPEC+” Bloomberg via Rigzone
“As Pipeline Projects Cancel, Future Falls Into Question” Houston Chronicle
“Fossil Fuels Account For The Largest Share Of U.S. Energy Production And Consumption” U.S. Energy Information Administration

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Written by:
Jackie Schweichler – Staff Attorney
Sarah Straub – Research Assistant
Audry Thompson – Research Assistant