January 29, 2024

Shale Law Weekly Review—Week of January 29, 2024

Methane Emissions: EPA Proposes New Rule Aimed at Methane Reductions in Oil and Gas Industry ⚡
On Friday, January 12, 2024, the Environmental Protection Agency (EPA) Press Office released a statement regarding a newly proposed EPA rule aimed at reducing “wasteful methane emissions from the oil and gas sector.” The purported purpose of these methane emission reduction measures is to “incentivize industry innovation” while also protecting the environment. The final rule, published on December 2, 2023, is focused on reducing air pollution from activities within the oil and gas industry, particularly those listed under the “Crude Oil and Natural Gas source category.” To achieve this goal, the EPA will act to revise the standards for regulating greenhouse gas emissions under the Crude Oil and Natural Gas source category to align with the Clean Air Act (CAA). Additionally, the EPA will provide emissions guidelines to states on implementing performance standards for GHG emissions from sources in the oil and gas industry. Further, the EPA will address Congress’ disapproval of a previously issued final rule aimed at standard setting for emissions from the oil and gas industry. Finally, the EPA is working to complete a protocol for the use of optical gas imaging technology to detect and monitor emissions from the oil and gas industry.

National Energy Policy: USDA Announces Nearly $19 Million in Grants to Promote Biofuels
On January 11, 2024, the U.S. Department of Agriculture (USDA) announced $19 million in grants to organizations with the stated goal of increasing consumer access to biofuels. These grants are made to organizations in 22 states through the Higher Blends Infrastructure Incentive Program. This program aims to promote and expand the use of ethanol and biodiesel through adaptive infrastructure development. More information on the funded projects can be found on the USDA website.

Municipal Regulation: Ninth Circuit Rules Against a Prohibition on the Installation of Natural Gas Piping Issued by the City of Berkley
On January 2, 2024, the U.S. Ninth Circuit Court of Appeals released a order and amended opinion ruling against an ordinance published by the City of Berkley California which banned the use of natural gas piping in new construction. Cra v. City of Berkeley, 9th Cir, No. 21-16278. This opinion amended an opinion previously published on April 17, 2023, and denied a petition for rehearing en banc. In the original complaint, the California Restaurant Association sought declaratory and injunctive relief from the ordinance, arguing that the federal Energy Policy and Conservation Act (EPCA) preempted all state and local regulations concerning energy efficiency standards for home appliances. The U.S. Federal District Court for the Northern District of California disagreed dismissing the case July 6, 2021. The Ninth Circuit, however, found that the EPCA did preempt building codes when they concerned energy use by what the EPCA calls “covered products,” which are those home appliances regulated by the Act. The Court limited its holding, finding only that the EPCA’s preemption clause extended to building codes and that the ordinance propagated by the City of Berkley happened to fall within that clause. The Court determined that since the EPCA already established a federal energy efficiency standard for natural gas appliances, that standard preempts any state or local regulation. Further, the Court noted that the City’s phrasing of the ordinance to prohibit the installation of natural gas piping, as opposed to limiting the use of natural gas appliances, was not sufficient to circumvent EPCA preemption.

State Regulation: Ohio Passes Bill Prohibiting Restrictions on Vehicles Based on Energy Source
On December 28, 2023, Ohio Governor Mike DeWine signed House Bill 201 (H.B. 201), which will go into effect March 28, 2024. H.B. 201 provides general prohibitions on state agencies, townships, and counties from restricting “the use or sale of a motor vehicle based on the energy source.” Additionally, the Bill prohibits the Ohio Environmental Protection Agency, and any other state agency, from adopting California’s motor vehicle emission standards – authorized under section 209(b) of the Clean Air Act. Lastly, an Ohio Senate amendment (December 13, 2023) provides for an “Infrastructure development rider” which will permit natural gas utility companies to recover the cost of infrastructure and requires the Public Utilities Commission of Ohio to approve a regulatory deferral, for no more than 5 years, of any costs exceeding the statutory limit of $1.50 per month per customer. Recoverable costs include planning, development, and construction costs, such as those necessary for building and connecting interstate pipelines.

 

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CENTER PROGRAMS & RESOURCES

Understanding Agricultural Law – A free monthly Zoom webinar series for all agricultural and rural business advisors. One hour of substantive CLE credit available for Pennsylvania-licensed attorneys at no charge. Recordings and materials from the series, more information, and registration available here.

On January 31, 2024, The Mid-Atlantic Fruit and Vegetable Convention will be held at the Hershey Lodge in Hershey, Pennsylvania. On Wednesday, January 31, 2024, from 1:30–2:30pm, Staff Attorney Audry Thompson will present “The Fair Labor Standards Act: What You Need to Know” as part of the conference.

On February 8–10, 2024, PASA Sustainable Agriculture will hold their 2024 Sustainable Agriculture Conference at the Lancaster County Convention Center in Lancaster, Pennsylvania. On Friday, February 9, 2024, from 4:00–5:00pm, Staff Attorney Brook Duer will present “Protecting Your Farm’s Food Business with Product Liability Insurance” with the Small Business Development Center as part of the conference.

On Tuesday, February 13, 2024, from 12 noon–1:00 ET, will conduct the latest installment in its Quarterly Dairy Legal Webinar series. Each quarter’s free one-hour webinar covers the legal and regulatory developments in the U.S. dairy industry from the preceding quarter, as well as including an in-depth look at a single focus topic of law, regulation, or government policy of interest to dairy professionals of all kinds.

Follow us on Twitter @AgShaleLaw—Top #ShaleLaw HotLinks 

Hilcorp San Juan Resolves False Claims Act Claims for Oil and Natural Gas Royalty Underpayments to the United States (U.S. Department of Justice)

Developers Seek Big Changes to the Mountain Valley Pipeline’s Southgate Extension, Amid Sustained Opposition (Inside Climate News)

Biden-Harris Administration Invests $207 Million in Clean Energy and Domestic Fertilizer Projects to Strengthen American Farms and Businesses as part of Investing in America Agenda (USDA)

State utility regulators shoot down ERCOT’s attempt to add new rules for battery operators in Texas (San Antonio Express-News)

DEP Awards $101.1 Million In Federally-Funded Grants To Support Local Abandoned Mine-Related Restoration; Deadline For Next Round Of Grants Feb. 19 (PA Environment Digest)

Connect with us on Facebook.

Penn State Farmland Energy Legal Podcast: Listen to the latest episode here.

Oil & Gas Law & Policy Resources:

Elkin, Federal Court Limits State Authority to Deny Interstate Transmission Projects (January 22, 2024)

Sartain, Is a Merger a “Transfer of Leases”? (January 23, 2024)

Bloomberg, Oil Falls in Choppy Session as Supply Gains Blunt Red Sea Risks (January 23, 2024)

Bloomberg, Oil Extends Gains to Near One-Month High as US Stockpiles Shrink (January 25, 2024)

Bloomberg, Oil Set for Best Week Since October on Rising Geopolitical Risks (January 26, 2024)

FEDERAL ACTIONS—EXECUTIVE & LEGISLATIVE

U.S. DEPARTMENT OF ENERGY PRESS RELEASES

DOE Advancing Safe and Secure AI Research Infrastructure Through the National Artificial Intelligence Research Resource Pilot (January 24, 2024)

Biden-Harris Administration Announces $254 Million to Decarbonize America’s Industrial Sector and Revitalize Domestic Manufacturing (January 25, 2024)

DOE to Update Public Interest Analysis to Enhance National Security, Achieve Clean Energy Goals and Continue Support for Global Allies (January 26, 2024)

U.S. ENVIRONMENTAL PROTECTION AGENCY PRESS RELEASES

EPA, HUD, DOE Sign Joint Letter Asking Utility Companies to Make Energy and Water Usage Data Available for Multifamily Properties (January 25, 2024)

EPA Fines Omaha Chemical Manufacturing Facility for Alleged Violations of Multiple Environmental Laws (January 24, 2024)

EPA Approves Permits to Begin Construction of Wabash Carbon Services Underground Injection Wells in Indiana’s Vermillion and Vigo Counties (January 24, 2024)

FEDERAL EXECUTIVE AGENCIES (Federal Register January 20– January 26, 2024)

Environmental Protection Agency

89 FR 5318: Proposed Rule, Comments Close 3/11/24: “Waste Emissions Charge for Petroleum and Natural Gas Systems” (January 26, 2024)

89 FR 4243: Proposed Rule, Comments 3/25/24: “Standards of Performance for New Stationary Sources and Emission Guidelines for Existing Sources: Large Municipal Waste Combustors Voluntary Remand Response and 5-Year Review” (January 23, 2024)

89 FR 4474: Proposed Rule, Comments Close 3/25/24: “Clean Water Act Effluent Limitations Guidelines and Standards for the Meat and Poultry Products Point Source Category” (Janaury 23, 2024)

Safety and Environmental Enforcement Bureau

89 FR 4621: Notice, Comments Close 2/23/24: “Agency Information Collection Activities; Submission to the Office of Management and Budget for Review and Approval; Unitization” (January 24, 2024)

89 FR 4618: Notice, Comments Close 2/23/24: “Agency Information Collection Activities; Submission to the Office of Management and Budget for Review and Approval; Oil and Gas Drilling Operations” (January 24, 2024)

89 FR 4620: Notice, Comments Close 2/23/24: “Agency Information Collection Activities; Submission to the Office of Management and Budget for Review and Approval; General” (January 24, 2024)

Ocean Energy Management Bureau

89 FR 4815: Rule: “2024 Civil Penalties Inflation Adjustments for Oil, Gas, and Sulfur Operations in the Outer Continental Shelf” (January 25, 2024)

89 FR 3949: Notice: “Procedures for Determining Bid Adequacy at Outer Continental Shelf Oil and Gas Lease Sales” (January 22, 2024)

Other Agencies

89 FR 4884: Proposed Rule: “Endangered and Threatened Wildlife and Plants; 90-Day Findings for 10 Species” (January 25, 2024)

89 FR 4320: Notice: “Shipping Safety Fairways Along the Atlantic Coast” (January 23, 2024)

89 FR 4370: Rule: “Takes of Marine Mammals Incidental to Specified Activities; Taking Marine Mammals Incidental to the Coastal Virginia Offshore Wind Commercial Project Offshore of Virginia” (January 23, 2024)

89 FR 3884: Rule: “2024 Civil Monetary Penalty Inflation Adjustments” (January 22, 2024)

U.S. HOUSE ENERGY AND COMMERCE COMMITTEE

H.R.6747 “Clean Electricity and Transmission Acceleration Act of 2023” Referred to the Subcommittee on Forestry. (January 25, 2024)

U.S. SENATE ENERGY AND NATURAL RESOURCES COMMITTEE 

S.3655 “A bill to prohibit a drawdown and sale of petroleum products from the Strategic Petroleum Reserve if the President has withdrawn certain land from oil and gas leasing, and for other purposes.” Read twice and referred to the Committee on Energy and Natural Resources. (January 24, 2024)

STATE ACTIONS—EXECUTIVE & LEGISLATIVE 

PENNSYLVANIA DEPT. OF ENVIRONMENTAL PROTECTION PRESS RELEASES

Shapiro Administration Awards Funding to Protect Delaware Estuary Coastal Zone (January 24, 2024)

Shapiro Administration Awards Funding to Protect Lake Erie Coastal Zone (January 24, 2024)

Shapiro Administration, DEP Requires All Fracking Companies to be More Transparent About Chemicals Used in Drilling (January 26, 2024)

PENNSYLVANIA EXECUTIVE AGENCIES (Pa. Bulletin Vol. 54, No. 4 – January 27, 2024)

Department of Environmental Protection

54 Pa.B. 473: Notices: “Suspension of Enforcement of Initial Annual Reports”

Pennsylvania Legislature

SB 581 “An Act amending Title 58 (Oil and Gas) of the Pennsylvania Consolidated Statutes, in development, further providing for well location restrictions.” Referred to ENVIRONMENTAL RESOURCES AND ENERGY [Senate] (January 22, 2024)

Written by:
Kendal Ashman, Research Assistant
Kole Zellers, Research Assistant
Dillon Lightfoot, Research Assistant
Sergio Porras, Research Assistant
Jackie Schweichler, Staff Attorney