Shale Law Weekly Review – August 25, 2020

LNG Infrastructure: Fourteen States Petition Court to Review Agency Rule Allowing LNG To Be Transported by Rail
On August 18, 2020, fourteen states petitioned the U.S. Federal Court of Appeals for the District of Columbia to review the final rule issued by the Pipeline and Hazardous Materials Safety Administration (PHSMA), Department of Transportation.  The final rule allows for liquefied natural gas (LNG) to be transported by rail tank car and is scheduled to take effect on August 24, 2020.  The states allege that the final rule is unlawful under the Administrative Procedure Act, the Hazardous Materials Transportation Act, and the National Environmental Policy Act; and they ask the court to vacate the rule.  By letter dated January 13, 2020, many of the states that filed the lawsuit wrote to the Deputy Administrator for PHSMA objecting to the final rule.  The states argue that the rule creates potential for an increased risk of catastrophic accidents and the rule does not take into account potential environmental and climate impacts of transporting LNG by rail.

Methane Emissions: EPA Issues Two Final Rules Amending New Source Performance Standards for Oil and Gas Industry
On August 13, 2020, Environmental Protection Agency (EPA) Administrator Andrew Wheeler announced two final rules which amend New Source Performance Standards (NSPS) for the oil and gas industry.  As stated in a fact sheet issued by EPA, the new rules are meant to benefit small oil and gas producers and should save the industry $100 million a year for the next nine years.  The first rule titled, Oil and Natural Gas Sector: Emission Standards for New, Reconstructed, and Modified Sources Review, rescinds NSPS methane requirements applicable to transmission, storage, production, and processing.  The first rule also establishes policy for Section III of the Clean Air Act whenever EPA promulgates NSPS for air pollutants.  EPA must find that the pollutant is a source of dangerous air pollution prior to creating new NSPS.  The second rule titled, Oil and Natural Gas Sector: Emission Standards for New, Reconstructed, and Modified Sources Reconsideration, includes amendments relating to fugitive emissions requirements, well site pneumatic pump standards, certification of closed vent systems, and use of an alternative means of emission limitation. (rule summary).

Pipelines: District Court Denies Motion to Dismiss North Dakota’s Lawsuit for Pipeline Reimbursement
On August 19, 2020, the U.S. District Court for the District of North Dakota issued an order partially denying a motion from the U.S. Army Corps of Engineers (Corps) to dismiss a lawsuit brought by North Dakota for damages relating to pipeline protests.  North Dakota brought suit alleging that the Corps enabled protestors and had a duty to prevent harm to persons and private property during the demonstrations against the Dakota Access Pipeline.  North Dakota is asking for $38 million in damages.  The court dismissed North Dakota’s Good Samaritan negligence claim, but will allow the state’s claims for public nuisance, negligence, gross negligence, and civil trespass to move forward.

From the National Oil & Gas Law Experts:
Charles Sartain, Industry Custom Determines Who Pays for a Well Emergency (August 20, 2020)
J. Porter Wiseman, Senate Energy Natural Resources Committee Examines Cyberattack Readiness of the US Bulk-Power System (August 18, 2020)
John McFarland, The Global Energy Mix (August 18, 2020)

AGENCY PRESS RELEASES—STATE/FEDERAL

Pennsylvania Department of Energy Press Releases:
DEP Reaches Agreement with CNX to Address 2019 Well Control Incident at Shaw Well (August 20, 2020)
DEP Assesses $355,000 Penalty to Sunoco for 2018, 2019 Mariner East 2 Violations (August 20, 2020)
Wolf Administration: Report Shows Clean Energy Is a Leading Creator of Quality Jobs in Pennsylvania, Supports Development of Job Investment Strategies to Benefit Workers, Economy, and Environment (August 17, 2020)
DEP Local Climate Action Program Helps Community Leaders Address Climate Change in 139 Municipalities (August 17, 2020)

U.S. Department of Energy
Department of Energy to Provide $21 Million for Artificial Intelligence and Machine Learning Research on Fusion Energy (August 19, 2020)
Department of Energy Awards $13.5 Million for Direct Air Capture Research (August 18, 2020)
Department of Energy Announces $37 Million for Artificial Intelligence and Machine Learning at DOE Scientific User Facilities (August 17, 2020)

STATE ACTIONS—EXECUTIVE/LEGISLATIVE

Pennsylvania Legislature:
HB 2797 “An Act amending the act of April 9, 1929 (P.L.343, No.176), known as The Fiscal Code, in general budget implementation, repealing provisions relating to Joint Legislative Air and Water Pollution Control and Conservation Committee; and making a related repeal.” Referred to Environmental Resources and Energy (August 18, 2020) (House)

House Environmental Resources and Energy
Public Hearing on Regional Greenhouse Gas on August 24, 2020 at 10:00 a.m. in Room 140 of the Main Capitol.

Senate Environmental Resources and Energy
Public hearing to examine the economic and employment impacts of Pennsylvania’s participation in the Regional Greenhouse Gas Initiative (RGGI) on August 25, 2020 at 1:00 p.m.

FEDERAL ACTIONS—EXECUTIVE/LEGISLATIVE

Federal Executive Agencies—Actions and Notices:
Environmental Protection Agency
85 FR 50786 “National Oil and Hazardous Substances Pollution Contingency Plan; National Priorities List: Deletion of the Fairfax St. Wood Treaters Superfund Site” Rule (August 18, 2020).
85 FR 51556 “Control of Air Pollution From Airplanes and Airplane Engines: GHG Emission Standards and Test Procedures” Proposed Rule (August 20, 2020).

Office of Energy Efficiency and Renewable Energy
85 FR 50937 “Energy Conservation Program for Appliance Standards: Procedures for Evaluating Statutory Factors for Use in New or Revised Energy Conservation Standards” Final Rule (August 19, 2020).

Follow us on Twitter at PSU Ag & Shale Law (@AgShaleLaw) to receive ShaleLaw HotLinks:
“New Lyrics, Same Tune For US Shale Producers” Argus Media
“Companies Offer Super-cool Solution to Flaring Gas in The Permian” Houston Chronicle
“14 States Sue Trump Administration Over Gas Transportation Rule” The Hill
“Mountain Valley Pipeline to be Completed Next Year” Shale Gas Reporter
“How Would a 2nd Lockdown Affect Oil Prices?” Rigzone

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