Shale Law Weekly Review – Week of March 22, 2021

Pipelines: Court of Appeals Vacates Denial of Clean Water Act Certification for Mountain Valley Pipeline’s Southgate Project ⚡
On March 11, 2021, the U.S. Court of Appeals for the Fourth Circuit vacated North Carolina’s denial of Section 401 Clean Water Act Certification for Mountain Valley Pipeline’s (MVP) Southgate Project.  (Mountain Valley Pipeline, LLC v. North Carolina Dep’t of Envtl. Quality, No. 20-1971).  North Carolina’s Department of Environmental Quality (DEQ) denied MVP certification due to the uncertainty of MVP’s main pipeline project status.  In its decision, DEQ cited the suspended and pending federal permits that MVP needs in order to complete construction of the mainline project.  The Court of Appeals ruled that DEQ did not provide adequate explanation as to why they denied certification rather than grant conditional certification.  The court vacated DEQ’s denial and remanded the case back to DEQ to provide further explanation.  The MVP Southgate Project is designed to supply natural gas and cover 75 miles from Pittsylvania County in Virginia to Rockingham and Alamance Counties in North Carolina.

Hydraulic Fracturing Bans: Pennsylvania State Senators File Motion to Intervene in Lawsuit Regarding Delaware River Basin Hydraulic Fracturing Moratorium
On March 12, 2021, several Pennsylvania state Senators filed a Motion and Memorandum to Intervene in a lawsuit regarding the recent Delaware River Basin hydraulic fracturing moratorium.  (Yaw v. Delaware River Basin Comm’n, No. 2:21-cv-119, U.S. District Court for the Eastern District of Pennsylvania).  The lawsuit was initially filed by state Republican Senators Gene Yaw and Lisa Baker, along with the Senate Republican Caucus and Damascus Township.  The initial Complaint alleges that the moratorium on hydraulic fracturing in the Delaware River Basin violates the Delaware River Basin Compact.  In the most recent motion, the Senators, who are members of the Democratic party, argue they should be allowed to intervene because their interests may be affected by the outcome of the lawsuit, and they are not adequately represented by the current parties involved in the lawsuit.  The Delaware River Basin covers 13,539 square miles and provides water resources for 13 million people.  For more information on the lawsuit, see the Shale Law Weekly Review for January 18, 2021.

Environmental Impact Studies: FERC Issues Environmental Assessment for Columbia Gulf Transmission’s East Lateral XPress Project
On March 16, 2021, the Federal Energy Regulatory Commission (FERC) published an Environmental Assessment (EA) for the Columbia Gulf Transmission, LLC’s East Lateral XPress Project (XPress Project).  (Docket No. CP20-527-000).  The XPress Project proposal includes 8.1 miles of lateral pipeline, two compressor stations, a point of delivery meter station, and a tie-in facility all located in Louisiana.  In the EA, FERC made several findings including that the Project’s impact on surface waters, wetlands, essential fish habitat, vegetation, road congestion, noise, and air quality would only temporarily affect construction areas and would not be significant.  Along with Columbia’s own Environmental Construction Standards, the Project will be required to follow FERC’s erosion control maintenance plan and wetland mitigation procedures.  FERC ultimately concluded that through implementation of proposed mitigation measures, the XPress project “would not constitute a major federal action significantly affecting the quality of the human environment.”

Public Lands: Federal Reserve Bank Issues Report on Impact of Gas Leasing and Permitting Ban on Federal Lands
On March 4, 2021, the Federal Reserve Bank of Dallas published a report (Dallas Report) showing that recent federal hydraulic fracturing moratoriums could disproportionately effect New Mexico in the Permian Basin.  The Permian Basin is a large shale rock formation positioned across the New Mexico/Texas border.  The basin is located primarily on federal lands in New Mexico and is located on private and state-owned lands in Texas.  As such, the Dallas Report predicts that a federal leasing and permitting ban for hydraulic fracturing would result in workers, companies, and tax revenues moving from New Mexico into Texas.  The report used three different possible regulation scenarios to predict the impact on Permian Basin production.  The third scenario, contemplating a permanent ban on hydraulic fracturing leasing and permitting on federal lands, would likely result in a reduction of New Mexico’s production by 800,000 barrels per day, by 2025.

Shale Law/Policy Resources of Interest:

George A. Bibikos, At the Well Weekly, Art. I, sec. 27 (March 12, 2021)

Scott Daniel Johnson & George (Chip) Cannon Jr., FERC Announces and Solicits Comments for June 2021 Technical Conference on Climate Change, Extreme Weather and Electric System Reliability (March 17, 2021)

John McFarland, Endeavor v. Energen: What does a court do if a lease retained acreage clause is ambiguous? (March 18, 2021)

Romany Webb, The Law Of Enhanced Weathering For Carbon Dioxide Removal: Legal Issues Associated With Materials Sourcing (March 16, 2021)

Hillary Aidun, Community Group Welcomes Step Forward For Offshore Wind In New York (March 18, 2021)

AGENCY PRESS RELEASES – STATE/FEDERAL

Pennsylvania Department of Environmental Protection

DEP Makes It Easier to Get Low-Interest Loans for High-Impact Energy Efficiency Projects (March 19, 2021)

United States Department of Energy

U.S. Department Of Energy Announces Call For Joint U.S.-Israel Clean Energy Technology Proposals (March 15, 2021)

DOE Announces Cybersecurity Programs for Enhancing Safety and Resilience of U.S. Energy Sector (March 18, 2021)

DOE Announces $34.5 Million for Data Science and Computation Tools to Advance Climate Solutions (March 19, 2021)

United States Environmental Protection Agency

EPA settlement with Hess Corporation for Clean Water Act violations at North Dakota gas plant (March 11, 2021)

STATE ACTIONS—EXECUTIVE/LEGISLATIVE

Pennsylvania Legislature

HB 838 “An Act amending Title 58 (Oil and Gas) of the Pennsylvania Consolidated Statutes, in development, further providing for hydraulic fracturing chemical disclosure requirements.” Referred to Environmental Resources and Energy (March 15, 2021)

SB 435 “An Act amending Title 66 (Public Utilities) of the Pennsylvania Consolidated Statutes, in restructuring of electric utility industry, providing for transportation fueling infrastructure development” Referred to Consumer Protection and Professional Licensure (March 18, 2021)

Environmental Resources and Energy Committee

“Informational meeting on Embracing Pennsylvania’s Energy Potential: Hydrogen Power and Carbon Capture, Part 2” (March 22, 2021 at 11:00 am)

Pennsylvania Executive Agencies—Actions and Notices (Pa. Bulletin Vol. 51, No. 12—March 20, 2021)

51 Pa.B. 1592 Department of Environmental Protection “Conditional State Water Quality Certification under Section 401 of the Clean Water Act for the United States Army Corps of Engineers Pennsylvania State Programmatic General Permit 6” (March 20, 2021)

FEDERAL ACTIONS—EXECUTIVE/LEGISLATIVE

Federal Executive Agencies (Federal Register March 15-19, 2021):

Federal Energy Regulatory Commission

86 FR 14319 Notice—Comments Period “Southern Natural Gas Company, L.L.C.; Notice of Request Under Blanket Authorization and Establishing Intervention and Protest Deadline” (March 15, 2021)

86 FR 14902 Notice—Comments Period “Florida Gas Transmission Company, LLC; Notice of Scoping Period Requesting Comments On Environmental Issues for The Proposed Big Bend Project” (March 19, 2021)

86 FR 14895 Notice—Comments Period “Climate Change, Extreme Weather, and Electric System Reliability; Supplemental Notice of Technical Conference Inviting Comments” (March 19, 2021)

86 FR 14898 Notice—Comments Period “ANR Pipeline Company; Notice of Request Under Blanket Authorization and Establishing Intervention and Protest Deadline” (March 19, 2021)

Environmental Protection Agency

86 FR 14846 Direct Final Rule “State of Michigan Underground Injection Control (UIC) Class II Program; Primacy Approval” (March 19, 2021)

Energy Department

86 FR 14618 Notice “Energy Conservation Program for Consumer Products: Representative Average Unit Costs of Energy” (March 17, 2021)

House Energy and Commerce Committee Actions:

H.R. 2115 “To require the Federal Energy Regulatory Commission to apply certain procedures before granting a certificate of public convenience and necessity for a proposed pipeline project, and for other purposes” Referred to the House Committee on Energy and Commerce (March 19, 2021)

H.R. 2102 “To eliminate certain subsidies for fossil-fuel production” Referred to the Committee on Ways and Means (March 19, 2021)

H.R. 1992 “To require the Secretary of Energy to establish programs for carbon dioxide capture, transport, utilization, and storage, and for other purposes” Referred to the Subcommittee on Water Resources and Environment (March 18, 2021)

Senate Energy and Natural Resources Committee Actions:

1. 799 “A bill to require the Secretary of Energy to establish programs for carbon dioxide capture, transport, utilization, and storage, and for other purposes” Read twice and referred to the Committee on Energy and Natural Resources (March 17, 2021)

Follow us on Twitter @AgShaleLaw—Top #ShaleLaw HotLinks March 15-19, 2021:

“21 States Sue Biden For Revoking Keystone XL Permit” Energywire

“Energy Companies Have Left Colorado With Billions Of Dollars In Oil And Gas Cleanup” High Country News

“Investors Call On Oil And Gas Companies To Address Climate Concerns In Permian Basin” Carlsbad Current-Argus

“’Environmental Racism’? Tenn. Pipeline Sparks Uproar” Energywire

“A Furious Industry Backlash Greets Moves by California Cities to Ban Natural Gas in New Construction” Inside Climate News

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