Shale Law Weekly Review – November 2, 2020

Pipelines: Federal Judge Permits Construction of Keystone XL Pipeline to Continue at Border
On October 16, 2020, the U.S District Court for the District of Montana issued an order denying renewed motions for a temporary restraining order and preliminary injunction filed by environmental groups seeking to stay all approvals that had been issued and to enjoin all pre-construction and construction activities for the Keystone XL Pipeline System.  The District Court concluded that petitioners, Indigenous Environmental Network and North Coast Rivers Alliance, failed to show both a likelihood of success on the merits and that they are likely to suffer irreparable injury if the injunction were denied.  The court noted that the case involved “complex and novel issues” and ordered additional briefing to be done by the parties addressing pipeline crossings at international borders.  Petitioners’ complaint challenges the 2019 executive order issued by President Trump permitting the pipeline to be constructed between the U.S. and Canada and alleges that the order violates the Property and Commerce Clauses of the Constitution and Executive Order 13337.

Pipelines: Enbridge Line 3 Receives Favorable Recommendation and Department of National Resources Permits
On October 16, 2020, an administrative law judge for the Minnesota Office of Administrative Hearings issued a report finding that petitioners failed to meet their burden of proof challenging the plans for construction to replace 340 miles of the Enbridge Line 3.  The judge found that the petitioners, comprised of environmental groups and tribes, failed to prove that water quality and wetlands would be permanently impacted from construction.  The petitioners also failed to show that the Minnesota Pollution Control Agency and Enbridge did not identify an environmentally prudent method for crossing two hundred twelve streams, and that the Agency and Enbridge had undercounted the amount of wetland that would be altered or impacted by the project.

On October 19, 2020, the Minnesota Department of Natural Resources issued two permits to Enbridge, stating that “the proposed project meets the applicable State of Minnesota environmental regulatory requirements to receive” the Department’s approval.  The Department of Natural Resources approved both the Gully 30 Fen Calcareous Fen Management Plan and the Gully 30 Fen Water Appropriation Permit. The Department is still considering eight other Enbridge Line 3 related plans.

Methane Emissions: New Mexico’s Proposed Rules Will Require Capture of 98% of Natural Gas Produced at Wells
On October 15, 2020, the New Mexico Oil Conservation Division released two new proposed rules (19.15.27 and 19.15.28) and three amendments to existing rules to reduce emissions in oil and gas fields.  The Oil Conservation Division has requested the Oil Conservation Commission to hold a public hearing on the new rules on January 5, 2021. The rules would impose new regulations governing reporting and reducing the amount of natural gas which is flared or vented. The new rules also propose regulations which would require operators to capture 98% of the natural gas produced from their wells by December 31, 2026.  The rules were promulgated in response to New Mexico Governor Michelle Lujan Grisham’s executive order directing the agency to address methane emissions and waste in the state’s oilfields.

Pipelines: Fourth Circuit Issues Order Staying Construction on Mountain Valley Pipeline
On October 16, 2020, the U.S. Court of Appeals for the Fourth Circuit issued two orders which halt construction on the Mountain Valley Pipeline in Virginia and West Virginia.  The administrative stays will remain in place until the court has an opportunity to fully consider the motions for stay filed by environmental groups opposing the pipeline.  Both motions, filed at docket numbers 20-2039 and 20-2042, allege that the U.S. Army Corps of Engineers wrongly reissued Mountain Valley Pipeline an NWP 12 permit because the agency failed to comply with provisions of the Endangered Species Act and because the pipeline cannot satisfy state specific requirements for the permit to be issued.

From the National Oil & Gas Law Experts:
Charles Sartain, Texas Court Evaluates Consent to Assign an Oil and Gas Lease, (October 20, 2020).
Margaret Barry & Korey Silverman-Roati, October 2020 Updates To The Climate Case Charts, (October 20, 2020).

Agency Press Releases – State/Federal 

U.S. Department of Energy Press Releases:
Trump Administration Secures American Energy Jobs, Natural Gas Exports, (October 20, 2020).

U.S. Department of Environmental Protection:
 EPA to Award Up to $5.5 Million for Clean Diesel Projects in Mid-Atlantic Region, (October 20, 2020).
EPA Awards More than $4.8 million for Clean Diesel Projects in New England, (October 19, 2020).

State Actions – Executive/Legislative

Pennsylvania Executive Agencies—Actions and Notices:
50 Pa.B 5923, Department of Labor and Industry, “Liquefied Petroleum Gas Facility; Notice of Application” (October 24, 2020).

Pennsylvania Legislature:
HR 1018 “A Resolution recognizing the month of October 2020 as “Energy Awareness Month” in Pennsylvania.” Adopted (October 19, 2020).
SB 745 “An Act amending Title 75 (Vehicles) of the Pennsylvania Consolidated Statutes, in inspection of vehicles, further providing for prohibition on expenditures for emission inspection program.” Third consideration and defeated on final passage (October 21, 2020).
HB 2934 “An Act amending the act of April 9, 1929 (P.L.343, No.176), known as The Fiscal Code, in oil and gas wells, further providing for definitions and for oil and gas lease fund and providing for Public Natural Resources Trust Fund.” Referred to Environmental Resources and Energy (October 19, 2020).
SB 1365 “An Act amending Title 66 (Public Utilities) of the Pennsylvania Consolidated Statutes, in natural gas competition, further providing for standards for restructuring of natural gas utility industry and for consumer protections and customer service and for requirements for natural gas suppliers…” Referred to Consumer Protection and Professional Licensure, (October 19, 2020).

Federal Actions – Executive/Legislative

Federal Executive Agencies—Actions and Notices:
U.S. Army Corps of Engineers
85 FR 67530 “Scoping Period Extension for Environmental Impact Statement for an Easement To Cross Under Lake Oahe, North Dakota for a Fuel-Carrying Pipeline Right-of-Way for a Portion of the Dakota Access Pipeline” Notice (October 23, 2020).
Environmental Protection Agency
85 FR 67535 “Alternative Methods for Calculating Off-Cycle Credits Under the Light-Duty Vehicle Greenhouse Gas Emissions Program: Applications From Volkswagen Group of America, Inc.” Notice (October 23, 2020).
85 FR 67536 “Environmental Impact Statements; Notice of Availability” Notice (October 23, 2020).
Federal Energy Regulatory Commission
85 FR 66287 “Waiver of the Water Quality Certification Requirements of Section 401(a)(1) of the Clean Water Act” Proposed Rule; Comments due November 18, 2020 (October 19, 2020).
85 FR 66321 “Freeport LNG Development, L.P., FLNG Liquefaction, LLC, FLNG Liquefaction 2, LLC, FLNG Liquefaction 3, LLC; Notice of Application and Establishing Intervention Deadline, Notice (October 19, 2020).
85 FR 66320 “Husky US Marketing, LLC and Phillips 66 Company v. TransCanada Keystone Pipeline, LP; Notice of Complaint” Notice (October 19, 2020).
85 FR 66321 “Equitrans, L.P.; Notice of Request Under Blanket Authorization” Notice (October 19, 2020).
85 FR 67094 “Participation of Distributed Energy Resource Aggregations in Markets Operated by Regional Transmission Organizations and Independent System Operators” Final rule (October 21, 2020)
85 FR 66965 “Carbon Pricing in Organized Wholesale Electricity Markets” Notice of proposed policy statement (October 21, 2020).
85 FR 66972 “Oil Pipeline Affiliate Contracts” Proposed policy statement (October 21, 2020).
85 FR 67342 “Magnolia LNG, LLC; Application To Amend Export Term Through December 31, 2050, for Existing Non-Free Trade Agreement Authorization” Notice of application (October 22, 2020)
85 FR 67344 “BP Energy Company; Application for Blanket Authorization To Export Previously Imported Liquefied Natural Gas to Non-Free Trade Agreement Countries on a Short-Term Basis” Notice of application (October 22, 2020).
85 FR 67348 “Notice of Revised Schedule for Environmental Review of the Rio Bravo Pipeline Company, LLC Rio Bravo Pipeline Project Amendment” Notice (October 22, 2020)
Bureau of Ocean Energy Management
85 FR 66348 “Gulf of Mexico Outer Continental Shelf Region-Wide Oil and Gas Lease Sale 256” Final notice of sale (October 19, 2020).
85 FR 66346 “Gulf of Mexico, Outer Continental Shelf (OCS), Oil and Gas Lease Sale 256” Notice of availability of a record of decision (October 19, 2020).

House Energy and Commerce Committee Actions:
HR 8635 “To amend the Clean Air Act to create a national zero-emission vehicle standard, and for other purposes” Referred to the House Committee on Energy and Commerce (October 20, 2020).
HR 8626 “To direct the Secretary of Energy to carry out a grant program to improve the energy resilience, energy democracy, and security of communities, prioritizing environmental justice communities, and for other purposes.” Referred to the Committee on Energy and Commerce and others (October 20, 2020).
HR 4447 “Clean Economy Jobs and Innovation Act” Received in the Senate and Read twice and referred to the Committee on Energy and Natural Resources (October 19, 2020).

Follow us on Twitter at PSU Ag & Shale Law (@AgShaleLaw) to receive ShaleLaw HotLinks:
“Aggressive Push to 100% Renewable Energy Could Save Americans billions – Study” The Guardian
“Oil, Gas Industry’s Economic Turmoil Fuels Worries About Fallout For Landowners, Communities” The Denver Post
“Railroad Commission Eyes Change To Flaring Rules” Houston Chronicle
“Elected Officials Say ‘frack That’ To Gas Pipeline In Brooklyn” AMNY
“ A Judge’s Ruling Ousted Federal Lands Chief. Now Some Want His Decisions Tossed, Too” Inside Climate News

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