Shale Law Weekly Review – January 27, 2020

Trespass by Fracture: Pennsylvania Supreme Court Addresses Trespass by Hydraulic Fracturing
On January 22, 2020, the Supreme Court of Pennsylvania issued a decision addressing the application of the Rule of Capture to unconventional oil and gas development in Pennsylvania. (Briggs v. Southwestern Energy Production, No. 63 MAP 2018).  Briggs filed a complaint against Southwestern asserting conversion and trespass claims due to the alleged drainage of natural gas from their property resulting from hydraulic fracturing activities conducted at Southwestern wells on adjacent property.  Southwestern responded by arguing that the Rule of Capture barred the Briggs’ claims.  In 2017, the Court of Common Pleas dismissed the case, opining that the rule of capture did not allow for damages caused by drainage that occurs pursuant to hydraulic fracturing.  The Pennsylvania Superior Court, however, reversed in 2018 based upon its conclusion that “the rule of capture does not preclude liability for trespass due to hydraulic fracturing.”  In this latest ruling, the Pennsylvania Supreme Court disagreed with the reasoning of the Superior Court, finding that the use of hydraulic fracturing does not alter the application of the Rule of Capture.

Pipelines: U.S. Department of State Approves Right of Way for Keystone XL Pipeline Project
On January 22, 2020, Secretary of the Interior David L. Bernhardt signed a Record of Decision and approved a right-of-way and temporary use permit allowing TransCanada Keystone Pipeline, L.P. to cross federal lands in Montana for the construction of the Keystone XL Pipeline project.  The decision follows a Final Supplemental Environmental Impact Statement (SEIS) issued on December 20, 2019.  The 2019 SEIS addressed changes to the Keystone XL Pipeline Project that had occurred since the initial release in 2014 of the Keystone XL Final SEIS, which itself had supplemented a Final EIS issued in 2011.  The 2019 Final SEIS addressed four deficiencies of the 2014 Final SEIS that had been identified by the U.S. District Court for the District of Montana including the effects of current oil prices, cumulative effects of greenhouse gas emissions, cultural resources, and accidental release modeling.  In a recent Press Release, the U.S. Bureau of Land Management (BLM) welcomed the decision of the Department of State to proceed with the pipeline project.

Infrastructure: Pennsylvania PUC Approves Acquisition of Natural Gas Distribution Company by Aqua America, Inc.
On January 16, 2020, the Pennsylvania Public Utility Commission (PUC) approved a $4.3 billion transaction by Aqua America, Inc. to acquire Peoples Natural Gas Company, a natural gas service provider headquartered in Pittsburgh, Pennsylvania.  Aqua America, Inc., is a holding company providing water services throughout the country. On the same day, Aqua America, Inc., announced that it was changing its company name to Essential Utilities, Inc., and that Peoples Natural Gas Company would become a subsidiary company of Essential Utilities.  The stated purpose of the newly created company will be to participate “in solving today’s water and natural gas infrastructure challenges by renewing and improving infrastructure through thoughtful capital investment, operational excellence, environmental stewardship and rigorous safety standards.”

From the National Oil & Gas Law Experts:
Georges A. Bibikos, At the Well Weekly (Jan. 17, 2020)
Charles Sartain, Strip and Gore Doctrine: Infinity War (Jan. 21, 2020)
Thompson & Knight LLP, Appeals Court Rules Individualized Action Accrual Applies in Spreading Contamination Case (Jan. 24, 2020)
U.S. Energy Information Agency, U.S. crude oil production efficiency continues year-over-year improvements (Jan. 24, 2020)
U.S. Energy Information Agency, EIA expects U.S. net natural gas exports to almost double by 2021 (Jan. 23, 2020)

AGENCY PRESS RELEASES—STATE/FEDERAL

Pennsylvania Department of Energy Press Releases:
DEP Issues a Code Orange Air Quality Action Day Forecast for January 24, 2020, for Susquehanna, Lehigh Valleys (January 23, 2020).
DEP Issues a Code Orange Air Quality Action Day Forecast for January 23, 2020, for the Liberty-Clairton Area in Allegheny County (January 22, 2020).

U.S. Department of Energy
Department of Energy Announces Nearly $300 Million for Sustainable Transportation Research (January 23, 2020).
Department of Energy Issues Final “Process Rule” Modernizing Procedures in the Consideration of Energy Conservation Standards (January 15, 2020).
Energy Information Administration’s Short-Term Outlook Forecasts Continued American Energy Growth (January 14, 2020).

U.S. Environmental Protection Agency
U.S. EPA and Army Deliver Navigable Waters Protection Rule and Redefine WOTUS (January 23, 2020).
EPA Settlement with Gulfport Energy to Reduce Emissions from Oil and Natural Gas Operations by 313 Tons Per Year (January 22, 2020).
EPA, Justice Department and State of Colorado announce settlement with K.P. Kauffman Co. to reduce emissions from oil and gas operations by more than 500 tons per year (January 21, 2020).

STATE ACTIONS—EXECUTIVE/LEGISLATIVE

Pennsylvania Executive Agencies—Actions and Notices:
No new actions January 20–27, 2020

Pennsylvania Legislature:
S.B. 790 “An Act relating to conventional wells and the development of oil, gas and coal; imposing powers and duties on the Department of Environmental Protection; providing for preliminary provisions, for general requirements, for enforcement and remedies, for related funds and for miscellaneous provisions; and making an appropriation” Re-reported as committed [House] (January 21, 2020).

FEDERAL ACTIONS—EXECUTIVE/LEGISLATIVE

Federal Executive Agencies—Actions and Notices:

Energy Department
85 FR 4314 “Dominion Energy Cove Point LNG, LP; Application for Blanket Authorization To Export Liquefied Natural Gas to Non-Free Trade Agreement Countries on a Short-Term Basis” Notice—Comment Period (January 24, 2020).
85 FR 3901 “Notice of Orders Issued Under Section 3 of the Natural Gas Act During November 2019” Notice (January 23, 2020).

Environmental Protection Agency
85 FR 4249 “National Oil and Hazardous Substances Pollution Contingency Plan; National Priorities List: Partial Deletion of the OU1 of the Libby Asbestos Superfund Site” Proposed Rule—Comment Period (January 24, 2020).

Federal Energy Regulatory Commission
85 FR 4319 “Bluewater Gas Storage, LLC; Notice of Availability of the Environmental Assessment for the Proposed Bluewater Compression Project” Notice (January 24, 2020).
85 FR 3908 “Puget Sound Energy, Inc.; Notice of Schedule for Environmental Review of the Jackson Prairie Storage Project” Notice (January 23, 2020).
85 FR 3906 “Dominion Energy Transmission, Inc.; Notice of Request Under Blanket Authorization” Notice (January 23, 2020).
85 FR 3907 “Combined Notice of Filings [UGI Utilities, Inc.; Southcross Alabama Pipeline LLC.; Southcross Mississippi Pipeline, L.P.; Northern Natural Gas Company; ANR Pipeline Company; Gulf South Pipeline Company, LLC]” Notice—Comment Periods (January 23, 2020).
85 FR 3905 “Combined Notice of Filings #1 [Pacific Gas and Electric Company]” Notice—Comment Periods (January 23, 2020).
85 FR 3677 “Notice of Request Under Blanket Authorization; Columbia Gas Transmission, LLC” Notice (January 22, 2020).
85 FR 3674 “Texas Eastern Transmission, LP; Notice of Intent To Prepare an Environmental Assessment for the Proposed Amended Marshall County Mine Panel 19E and 20E Project and Request for Comments on Environmental Issues” Notice (January 22, 2020).
85 FR 3676 “Combined Notice of Filings [Adelphia Gateway, LLC; Enable Mississippi River Transmission, LLC; Gulf South Pipeline Company, LLC; Rockies Express Pipeline LLC; East Tennessee Natural Gas, LLC]” Notice—Comment Periods (January 22, 2020).
85 FR 3667 “Rover Pipeline LLC; Notice of Application” Notice (January 22, 2020).
85 FR 3365 “Combined Notice of Filings #1 [Source Power & Gas LLC; Baltimore Gas and Electric Company, PJM Interconnection, L.L.C] Notice—Comment Periods (January 21, 2020).
85 FR 3367 “Combined Notice of Filings [Rockies Express Pipeline LLC; Adelphia Gateway, LLC]” Notice—Comment Periods (January 21, 2020).
85 FR 3363 “Combined Notice of Filings [Transcontinental Gas Pipe Line Company, LLC; East Tennessee Natural Gas, LLC; Dominion Energy Carolina Gas Transmission LLC; Equitrans, L.P.; Guardian Pipeline, L.L.C.; Midwestern Gas Transmission Company; OkTex Pipeline Company, L.L.C.; Viking Gas Transmission Company]” Notice—Comment Periods (January 21, 2020).
85 FR 3366 “Combined Notice of Filings #1 [Pacific Gas and Electric Company]” Notice—Comment Periods (January 21, 2020).
85 FR 3364 “Verdant Power, LLC; Notice of Application Tendered for Filing With the Commission and Soliciting Additional Study Requests and Establishing Procedural Schedule for Relicensing and a Deadline for Submission of Final Amendments” Notice (January 21, 2020).

Labor Department
85 FR 3723 “Agency Information Collection Activities; Submission for OMB Review; Comment Request; Safety Standards for Underground Coal Mine Ventilation-Belt Entry Used as an Intake Air Course To Ventilate Working Sections and Areas Where Mechanized Mining Equipment Is Being Installed or Removed” Notice—Comment Period (January 22, 2020).

Mine Safety and Health Administration
85 FR 4708 “Proposed Extension of Information Collection; Health Standards for Diesel Particulate Matter Exposure (Underground Coal Mines)” Notice—Comment Period (January 27, 2020).

Safety and Environmental Enforcement Bureau
85 FR 3716 “Agency Information Collection Activities; Application for Permit to Drill (APD, Revised APD), Supplemental APD Information Sheet, and all Supporting Documentation” Notice—Comment Period (January 22, 2020).

Surface Mining Reclamation and Enforcement Office
85 FR 4702 “Grant Notification for Fiscal Year 2020” Notice (January 27, 2020).

House Energy and Commerce Committee Actions:
H.R.5430 “United States-Mexico-Canada Agreement Implementation Act” Presented to President (January 22, 2020).
H.R.5650 “Federal Energy and Water Management Performance Act of 2020” Referred to the House Committee on Energy and Commerce (January 16, 2020).

Senate Energy and Natural Resources Committee Actions:
S.3202 “End Speculative Oil and Gas Leasing Act of 2020” Read twice and referred to the Committee on Energy and Natural Resources  (January 16, 2020).

Follow us on Twitter at PSU Ag & Shale Law (@AgShaleLaw) to receive ShaleLaw HotLinks:
“Virginia Senate Panel OKs Offshore Drilling, Fracking Bans,” AP News
“Pennsylvania Board Votes to Raise Shale Well Permit Fees 150%,” Pittsburgh Post-Gazette
“Mariner East Project Faces Push Back In Chester County, Pa.,” Shale Gas Reporter
“Sunoco Fined Nearly $2m for Pipeline Violations at Pa. Lake,” Shale Gas Reporter
“Natural-Gas Prices Fall Below $2,” The Wall Street Journal
“EPA, Colo. Company Reach Deal To Cut Emissions,” Energy Wire
“Trump Promotes Fossil Fuels at Climate-focused Forum,” Climate Wire
“N.Y. Pension Funds Divest From $3b in Fossil Fuel Assets,” Climate Wire
“Document Reveals Utilities’ Methane Plan,” Energy Wire
“Decline in ‘Fracklog” Shows Scale of Pullback by U.S. Shale Drillers,” BNN Bloomberg
“Satellite Finds ‘significant’ Spike in Flaring, Air Pollution,” Energy Wire
“US Adds 15 Oil, Gas Rigs,” Rigzone
“U.S. Natural Gas Exports to Grow With New LNG Capacity Start-ups,” LNG World News
“Fossil Fuels on Trial: Where the Major Climate Change Lawsuits Stand Today,” InsideClimate News

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Written by:
Chloe Marie – Research Specialist
Jackie Schweichler – Staff Attorney
Audry Thompson – Research Assistant