Shale Law Weekly Review – Week of April 5, 2021

GHG Emissions: New Mexico Commission Implements New Venting and Flaring Requirements ⚡
On March 25, 2021, the New Mexico Oil Conservation Commission approved a rule regulating venting and flaring in order to reduce natural gas waste.  The proposed final rule includes regulations for venting and flaring during drilling, completion, and production operations.  The rule requires operators to reduce the annual volume of natural gas that is vented or flared in order to capture at least ninety-eight percent of the natural gas produced.  The reduction in volume must be obtained by December 31, 2026.  The rule also includes performance, measurement, and reporting standards.  The Energy, Minerals, and Natural Resources Department stated that their rule differs from other states in that it would regulate the midstream sector, from wells to processing plants.  The proposed final rule will be finalized once it is published in the New Mexico Register.

Public Lands: Colorado Court Grants Bureau of Land Management Voluntary Remand of Resource Management Plan
On March 26, 2021, the U.S. District Court for the District of Colorado granted the Bureau of Land Management’s (BLM) Motion for Voluntary Remand of their Grand Junction Resource Management Plan (RMP).  (Center for Biological Diversity v. U.S. Bureau of Land Management, No. 19-cv-02869).  Environmental groups initially filed a Petition alleging that BLM failed to comply with the National Environmental Policy Act (NEPA) in the RMP.  More specifically, petitioners alleged that BLM failed to take a “hard look” at the indirect impacts of combustion engines and failed to consider alternatives to oil and gas leasing in the Grand Junction area.  In response, BLM motioned for voluntary remand, stating that they intended to conduct a supplemental environmental analysis of the Grand Junction RMP.  The court granted the Motion and closed the case administratively, subject to good cause for reopening.

Oil and Gas Leasing: PA Supreme Court Rules Landowners Obtaining Natural Gas Leases Are Not Protected Under State Consumer Protection Law
On March 24, 2021, the Supreme Court of Pennsylvania ruled that landowners obtaining natural gas leases from drilling companies are not protected under the Pennsylvania Unfair Trade Practices and Consumer Protection Law (Protection Law).  (Commonwealth of Pennsylvania v. Chesapeake Energy Corp., No. 81 MAP 2019).  Anadarko Petroleum Corporation and Anadarko E&P Onshore, L.L.C. (Anadarko) negotiated leases with landowners to obtain rights to landowners’ minerals for natural gas development.  Anadarko also entered into a separate market allocation agreement with Chesapeake Energy Corporation and affiliates (Chesapeake) for the same area as the landowners’ leases.  The Attorney General originally brought suit against Anadarko and Chesapeake under section 3 of the Protection Law, alleging interference with the competitive process, depriving landowners an opportunity to obtain better royalty and signing bonuses for their leases.  The Attorney General also alleged Anadarko and Chesapeake’s actions constituted “unfair and deceptive practices” under the Protection Law.  The court determined that the Attorney General’s claims were legally insufficient in applying the Protection Law.  The court found that Anadarko was not conducting “trade or commerce” under the Protection Law because it was not selling anything.  The court further explained that the Protection Law’s language applied to sellers engaging in “trade or commerce” and that the “trade or commerce” language could not be extended to Anadarko, who was a buyer of mineral rights.

Shale Law/Policy Resources of Interest:

George A. Bibikos, At the Well Weekly, Art. 1, sec. 27 (March 26, 2021)

Jeremy Mercer, Pennsylvania’s UTPCPL Does Not Apply To Acquiring Oil And Gas Leases From Property Owner (March 29, 2021)

Jeremy Mercer, Court Holds Recording Of Deeds Starts Statute Of Limitations Running (April 1, 2021)

Niki Roberts & David H. Sweeney, Critical Load Designation Critical for Nat Gas Producers (March 29, 2021)

Hillary Aidun, The Climate Leadership And Community Protection Act’s Environmental Justice Promise (April 2, 2021)

AGENCY PRESS RELEASES – STATE/FEDERAL

Pennsylvania Department of Environmental Protection

DEP Awards $2.4 Million in Driving PA Forward Funding to Transportation Projects to Improve Air Quality in Seven Counties (March 31, 2021)

United States Department of Energy

DOE Awards $110 Million to Small Businesses Pursuing Scientific, Clean Energy, and Climate Solutions (March 31, 2021)

Energy Secretary Granholm Announces Ambitious New 30GW Offshore Wind Deployment Target by 2030 (March 29, 2021)

United States Environmental Protection Agency

Joint Statement by the U.S. Environmental Protection Agency and Environment and Climate Change Canada on Environment and Climate Change (April 1, 2021)

STATE ACTIONS—EXECUTIVE/LEGISLATIVE

Pennsylvania Legislature

HB 1080 “An Act amending the act of November 30, 2004 (P.L.1672, No.213), known as the Alternative Energy Portfolio Standards Act, further providing for definitions and for alternative energy portfolio standards” Referred to Environmental Resources and Energy (April 1, 2021)

FEDERAL ACTIONS—EXECUTIVE/LEGISLATIVE

Federal Executive Agencies (Federal Register March 29 – April 4, 2021):

Environmental Protection Agency

86 FR 17073 Final Rule “Extension of 2019 and 2020 Renewable Fuel Standard Compliance and Attest Engagement Reporting Deadlines” (April 1, 2021)

Federal Energy Regulatory Commission

86 FR 16298 Final Rule “Waiver of the Water Quality Certification Requirements of Section 401(a)(1) of the Clean Water Act” (March 29, 2021)

86 FR 16715 Notice—Comments Period “ANR Pipeline Company; Notice of Application and Establishing Intervention Deadline” (March 31, 2021)

86 FR 17374 Notice—Comments Period “Notice of Request Under Blanket Authorization and Establishing Intervention and Protest Deadline; Columbia Gas Transmission, LLC” (April 2, 2021)

86 FR 17377 Notice—Comments Period “Notice of Request Under Blanket Authorization and Establishing Intervention and Protest Deadline; Stingray Pipeline Company, L.L.C.” (April 2, 2021)

Land Management Bureau

86 FR 17188 Notice—Comments Period “Agency Information Collection Activities; Conveyance of Federally-Owned Mineral Interests” (April 1, 2021)

House Energy and Commerce Committee Actions:

H.R. 2307 “To create a Carbon Dividend Trust Fund for the American people in order to encourage market-driven innovation of clean energy technologies and market efficiencies which will reduce harmful pollution and leave a healthier, more stable, and more prosperous nation for future generations.” Referred to the Committee on Ways and Means (April 1, 2021)

H.R. 2302 “To amend the Clean Air Act to eliminate the exemption for aggregation of emissions from oil and gas sources, and for other purposes” Referred to the House Committee on Energy and Commerce (April 1, 2021)

H.R. 2310 “To require the Administrator of the National Oceanic and Atmospheric Administration to establish a Climate Change Education Program, and for other purposes” Referred to the Committee on Energy and Commerce (April 1, 2021)

Follow us on Twitter @AgShaleLaw—Top #ShaleLaw HotLinks March 29 – April 4, 2021:

“No U.S. LNG Export FIDs Predicted in 2021, Says Wood Mackenzie” Natural Gas Intelligence

“Exxon, Chevron Take A Slow Walk On The Path To U.S. Shale Recovery” Reuters

“API Gives Ground On Methane As Biden Officials Review Regulations” Oil & Gas Journal

“Gas Drilling Firms Repel Pennsylvania’s Antitrust Lawsuit” AP

“When an Oil Company Profits From a Pipeline Running Beneath Tribal Land Without Consent, What’s Fair Compensation?” Inside Climate News

Connect with us on Facebook.  Every week we post the CASL Ledger detailing our publications and activities from the week. 

Penn State Shale Law Podcast: Listen to the latest episode here.

Written by:
Sara Jenkins – Research Assistant
Jackie Schweichler – Staff Attorney
Sarah Straub – Research Assistant