July 9, 2021

Shale Law Weekly Review – Week of July 5, 2021

GHG Emissions: Congress Nullifies 2020 EPA Rule Removing New Source Performance Standard Methane Limits ⚡
On June 30, 2021, President Biden signed into law joint resolution S.J.Res.14, which nullifies the Environmental Protection Agency’s (EPA) September 14, 2020 rule, “Oil and Natural Gas Sector: Emission Standards for New, Reconstructed, and Modified Sources Review” (85 FR 57018). The 2020 EPA rule removed methane limits from New Source Performance Standards (NSPS) requirements for the oil and gas sector and established EPA’s interpretation of the Clean Air Act, which required the agency to determine that a “pollutant causes or contributes significantly to dangerous air pollution” before publishing NSPS for some pollutants.

National Policy: Supreme Court Allows PennEast Pipeline to Condemn State Property in New Jersey
On June 29, 2021, the Supreme Court of the United States issued an opinion allowing Penn East Pipeline Company to condemn state-owned properties in New Jersey. PennEast Pipeline Col., LLC v. New Jersey et al, No. 19-1039. PennEast was issued a certificate of public convenience and necessity from the Federal Energy Regulatory Commission (FERC) on January 19, 2018, and in their condemnation proceedings, PennEast targeted some state-owned lands. New Jersey’s Attorney General sought to have the proceedings dismissed, arguing that states are entitled to sovereign immunity and, therefore, federal courts do not have jurisdiction to condemn state land. In the Supreme Court’s decision, they held that FERC, with the authority of the federal government, can grant certificates allowing the certificate holders to condemn both private and state property. According to the Court, the States agreed to be subject to eminent domain “in the plan of the Convention,” or when the Constitution was structured and created.

Natural Gas Storage: North Dakota Passes Law to Establish Permitting for Underground Oil and Gas Storage
On April 20, 2021, the North Dakota governor signed into law S.B. 2065, which allows for underground oil and gas storage and establishes permitting requirements for such storage in salt caverns or other reservoirs. The law requires the operator of the underground storage facility to make a “good-faith effort” to receive approval from other landowners who own the underground reservoir. The operator must receive a lease or make some type of arrangement with at least 55 percent of the reservoir owners.

Severance Tax: Louisiana Provides for Severance Tax Exemptions for Orphan Wells
On June 16, 2021, the governor of Louisiana signed into law S.B. 171, which makes changes to the definition of orphan wells within the state and allows for some tax exemptions. The law defines an orphan well as one with “no reported production” for more than twelve months. The law allows an operator to apply three months’ worth of severance taxes to “well enhancements,” including “re-entries, workovers, or plugbacks.” The operator may make this request for enhancements that create well production after October 1, 2021, and before June 30, 2031, and the request must be approved by the Department of Natural Resources.

Shale Law/Policy Resources of Interest:

Margaret Barry and Korey Silverman-Roati, July 2021 Updates to the Climate Case Charts (July 2, 2021).

Charles Sartain and Rusty Tucker, Tax Foreclosure on Royalty Did Not Include Possibility of Reverter (July 1, 2021).

Akin Gump attorneys and guest speakers, Akin Gump Hosts 2021 Mid-Year Energy Briefing, (June 28, 2021).

AGENCY PRESS RELEASES – STATE/FEDERAL

Pennsylvania Department of Environmental Protection

DEP Releases 2020 Oil and Gas Annual Report (June 30, 2021)

U.S. Department of Energy

DOE Invests $93 Million for New Discoveries in High Energy Physics (June 28, 2021).

U.S. Environmental Protection Agency

EPA Finalizes Cleanup Plan to Address Groundwater Contamination in the Townships of Cinnaminson and Delran, Burlington County, New Jersey (July 1, 2021).

EPA to Hold Methane Detection Technology Virtual Workshop (July 1, 2021).

EPA Announces Path Forward for TSCA Chemical Risk Evaluations (June 30, 2021).

EPA Announces $50 Million to Fund Environmental Justice Initiatives Under the American Rescue Plan (June 25, 2021).

STATE ACTIONS—EXECUTIVE/LEGISLATIVE

Pennsylvania Executive Agencies—Actions and Notices (Pa. Bulletin Vol. 51, No. 27—July 3, 2021)

51 Pa.B. 3609 Notice: “Applications for National Pollutant Discharge Elimination System (NPDES) Permits and Water Quality Management (WQM) Permits Under the Clean Streams Law and Federal Clean Water Act.”

51 Pa.B. 3680 Notice: “Environmental Quality Board July Meeting.”

51 Pa.B. 3685 Notice: “Revocation of Natural Gas Supplier Licenses of Companies that Did Not File a Natural Gas Supplier Annual Report or Pay Past Due Annual or Supplemental Fees.”

Pennsylvania Legislature

No relevant actions.

FEDERAL ACTIONS—EXECUTIVE/LEGISLATIVE

Federal Executive Agencies (Federal Register June 28–July 2 2021):

Energy Department

86 FR 35280 Notice: “Notice of Intent to Prepare a Supplemental Environmental Impact Statement for the Alaska LNG Project” (July 2, 2021).

Environmental Protection Agency

86 FR 35286 Notice: “Clean Air Act Advisory Committee (CAAAC): Notice of Meeting [July 21 and July 22]” (July 2, 2021).

86 FR 35085 Notice: “Information Collection Request Submitted to OMB for Review and Approval; Comment Request; EPA’s Methane Challenge and Natural Gas STAR Programs (Renewal)” (July 1, 2021).

Federal Energy Regulatory Commission

86 FR 35283 Notice: “Combined Notice of Filings #1 [Electric Rate Filings]” (July 2, 2021).

86 FR 35285 Notice: “Combined Notice of Filings #1 [Electric Rate Filings]” (July 2, 2021).

86 FR 35286 Notice: “Neptune Regional Transmission System Long Island Power Authority v. PJM Interconnection, L.L.C.; Notice Establishing Paper Hearing Procedures” (July 2, 2021).

86 FR 35281 Notice: “PJM Interconnection, L.L.C.; Notice of Filing” (July 2, 2021).

86 FR 35283 Notice: “Peoples Natural Gas; Supplemental Notice That Initial Market-Based Rate Filing Includes Request for Blanket Section 204 Authorization” (July 2, 2021).

86 FR 35082 Notice: “Columbia Gulf Transmission, LLC; Notice of Availability of The Draft Environmental Impact Statement for The Proposed East Lateral Xpress Project” (July 1, 2021).

86 FR 35080 Notice: “Combined Notice of Filings #1 [Exempt Wholesale Generator Filings]” (July 1, 2021).

86 FR 35079 Notice: “Pacific Gas and Electric Company; Notice of Application Accepted for Filing and Soliciting Comments, Motions to Intervene, and Protests” (July 1, 2021).

86 FR 34732 Notice: “SOO Green HVDC Link ProjectCo, LLC v. PJM Interconnection, L.L.C.; Notice of Complaint” (June 30, 2021).

86 FR 34733 Notice: “Combined Notice of Filings #1 [Exempt Wholesale Generator Filings]” (June 30, 2021).

86 FR 34732 Notice: “Combined Notice of Filings [Natural Gas Pipeline Rate and Refund Report Filings]” (June 30, 2021).

86 FR 34734 Notice “Golden Pass Pipeline, LLC; Notice of Application for Amendment and Establishing Intervention Deadline” (June 30, 2021).

86 FR 34000 Notice: “Combined Notice of Filings [Natural Gas Pipeline Rate and Refund Report Filings]” (June 28, 2021).

86 FR 33998 Notice: “Combined Notice of Filings #1 [Exempt Wholesale Generator Filings]” (June 28, 2021).

86 FR 34000 Notice: “Roaring Fork Interstate Gas Transmission, LLC; Kaiser-Frontier Midstream, LLC; Notice of Applications and Establishing Intervention Deadline” (June 28, 2021).

Ocean Energy Management Bureau

86 FR 34172 Withdrawal of Proposed Rule: “Oil and Gas and Sulfur Operations in the Outer Continental Shelf- Revisions to the Requirements for Exploratory Drilling on the Arctic Outer Continental Shelf” (June 29, 2021).

Transportation Security Administration

86 FR 34777 Notice: “Intent to Request Extension from OMB of One Current Public Collection of Information: Pipeline Operator Security Information” (June 30, 2021).

86 FR 34775 Notice: “Intent to Request Revision from OMB of One Current Public Collection of Information: Critical Facility Information of the Top 100 Most Critical Pipelines” (June 30, 2021).

Western Area Power Administration

86 FR 34002 Notice: “Proposed Salt Lake City Area Integrated Projects Firm Power Rate and Colorado River Storage Project Transmission and Ancillary Services Rates-Rate Order No. WAPA-199″ (June 28, 2021).

House Energy and Commerce Committee Actions:

H.R.4313 “To clarify which small refineries are eligible for an exemption from the requirements of the Renewable Fuel Program, and for other purposes.” Referred to the House Committee on Energy and Commerce. (July 1, 2021).

H.R.4309 “To advance innovation in and deployment of zero-emission electricity technology, and for other purposes.” Referred to the Committee on Energy and Commerce, and in addition to the Committees on Science, Space, and Technology, Ways and Means, Transportation and Infrastructure, and Education and Labor. . . (July 1, 2021).

H.R.4266 “To prevent energy poverty in at-risk communities, and for other purposes.” Referred to the Committee on Natural Resources, and in addition to the Committees on Agriculture, Energy and Commerce, the Budget, and Rules. . . (June 30, 2021).

Senate Energy and Natural Resources Committee:

No relevant actions.

Follow us on Twitter @AgShaleLaw—Top #ShaleLaw HotLinks June 28–July 2, 2021:

Supreme Court Backs Pipeline in Case on New Jersey Land Seizures, New York Times

Justice Department Opposes Lawsuit to Overturn Enbridge Line 3 Pipeline Approval, Natural Gas Intelligence

Supreme Court Rules in Favor of Oil Refineries in Blending Waiver Dispute, The Hill

EPA Underestimated Methane Emissions from Oil and Gas Development, The Hill

Oil Refiners Win at Supreme Court with Easier Waivers on Biofuel, BNN Bloomberg

House Votes to Nix Trump Methane Rule, The Hill

U.S. Bans Imports of Solar Panel Material from Chinese Company, Reuters

Pa Advocates Call on Governor to Strengthen Proposed Methane Rule Before Final Consideration, State Impact Pennsylvania

Expert: When Peak Oil Demand Arrives, OPEC’s Power Will Fade, Hart Energy