Shale Law Weekly Review—Week of November 14, 2022

State Regulation: PA Governor Signs Bill Granting Tax Subsidies for Natural Gas and Hydrogen Usage in Agriculture ⚡
On November 3, 2022, Pennsylvania Governor Wolf signed HB 1059, which grants a tax credit of $0.47 per unit of dry natural gas purchased and used in production of petrochemicals or fertilizer. The law includes a similar tax credit for the purchase and use of hydrogen in the same manner. The law increases the maximum tax credit for usages of natural gas to $56 million annually. In a letter, the governor explained that the purpose of the natural gas credit is to act as a “short-term fail-safe” for facilities unable to obtain hydrogen.

State Regulation: PA Well Plugging Program Bill Signed by Governor
On November 3, 2022, Pennsylvania Governor Wolf signed HB 2528, which establishes a program providing grants, an application and registration process, and a review process for plugging orphaned wells. The law includes an amendment which prevents oil and gas companies with environmental law violations from receiving the grants.

GHG Emissions: Utica Resource Operating Settles Air Quality Case and Agrees to Mitigate Air Pollution at Oil and Gas Wells
On November 4, 2022, the U.S. Department of Justice announced that Utica Resource Operating (“URO”) agreed to settlement of a case alleging Clean Air Act violations at its Ohio oil and gas wells in Ohio for $1.5 million and injunctive relief. U.S. v. Utica Res. Operating, Civil Action No. 22-3906. The consent decree, which does not include an admission of liability by URO, stipulates that URO will take numerous mitigation measures for air pollution at its wells, including part upgrades and reporting to the EPA.

Oil and Gas Leasing: Reinstated Montana Oil and Gas Lease Appealed by Tribal, Environmental Groups
On November 2, 2022, defendant-intervenors, the Pikuni Traditionalist Association and other tribal and environmental groups, filed an appeal challenging the D.C. District Court’s September 9, 2022 opinion, which had reinstated an oil and gas lease for Solenex, LLC in the Badger-Two Medicine area in Montana. Solenex v. Haaland, et al., Civil Case No. 13-993 (RJL). The appeal asks the U.S. Circuit Court of Appeals for the District of Columbia to reverse the lower court’s opinion, which had reinstated the lease on the grounds that the Department of the Interior did not have authority to rescind the lease.

GHG Emissions: IER Files Amicus Brief in Case Challenging EPA’s Grant of Waiver to California for Zero Emission Vehicle Standard
On October 31, 2022, the Institute of Energy Research filed an amicus brief in a case consisting of a coalition of states and trade associations challenging the Environmental Protection Agency’s grant of a waiver allowing California to promulgate its Zero Emissions Vehicle sales mandate and related policy. Ohio, et al. V. EPA and Regan, Case No. 22-1081. Per its press release, the IER brief argues that the waiver, which exempts California’s regulation from preemption by the Clean Air Act, is a violation of the constitutional principle of equal state sovereignty, the federal Corporate Average Fuel Economy Standards, and prior Supreme Court precedent.

Oil and Gas Leasing: Environmental Groups Request Public Hearings on Lease Sales in Multiple States
On November 7, 2022, a coalition of environmental groups including the Center for Biological Diversity and the Sierra Club sent a letter to the U.S. Department of the Interior requesting public hearings be held for planned oil and gas lease sales in Kansas, New Mexico, and Wyoming. The letter also requests an extension of the public comment period from 30 days to at least 75 days or more, calling the 30-day period “unreasonable.”

 

Oil & Gas Law & Policy Resources:

Markowitz, et al., This Week’s Climate Policy Update (November 7, 2022)

Nishi, UNPACKING THE LIABILITY ARGUMENT AGAINST LOSS AND DAMAGE FUNDING (November 7, 2022)

McFarland, EnerVest v. Mayfield – another loss for royalty owners on post-production costs (November 8, 2022)

Sartain, Exxon’s Attempt to Create New Sale/Lease Tax Law Fails (November 9, 2022)

Markowitz, et al., COP 27: Top News for the Fourth Day of Events (November 10, 2022)

Follow us on Twitter @AgShaleLaw—Top #ShaleLaw HotLinks November 5– November 11, 2022:

Targa to build new Permian basin NGL pipeline (Oil & Gas Journal)

EPA awards grants to monitor air quality in 37 states (AP)

World’s first zero-emission gas plant announced in Texas (PoliticoPro)

Tanzania to sign $40B LNG-project accords next month (PoliticoPro)

Environmental groups push Interior to delay oil lease sales (E&E News)

Connect with us on Facebook. 

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

FEDERAL ACTIONS—EXECUTIVE & LEGISLATIVE

U.S. DEPARTMENT OF ENERGY

Biden- Harris Administration Launches First-Of-Its-Kind $50 Million Program to Help Nonprofits Make Critical Energy Upgrades (November 10, 2022)

DOE Announces Cost-Shared Award for First-Ever Domestic Production of HALEU for Advanced Nuclear Reactors (November 10, 2022)

U.S. ENVIRONMENTAL PROTECTION AGENCY

Utica Resource Operating Agrees to Pay $1 Million Penalty and Mitigate Past Excess Air Pollution at Oil and Gas Production Wells (November 7, 2022)

EPA Responds to Petitions to Address Harmful Emissions from Locomotives (November 9, 2022)

EPA Reaches Settlement with Evergy Kansas Central Inc. on Actions to Address Compliance with Coal Combustion Residuals Regulations (November 9, 2022)

EPA Awards $7.7 Million for Research Grants to Improve Risk Assessment of Chemical Mixtures in the Environment (November 9, 2022)

EPA Clean Air Act Settlements Address Illegal Tampering with Diesel Truck Emission Controls, Making Way for Cleaner Air in New England (November 10, 2022)

Biden-Harris Administration Strengthens Proposal to Cut Methane Pollution to Protect Communities, Combat Climate Change, and Bolster American Innovation (November 11, 2022)

FEDERAL EXECUTIVE AGENCIES (Federal Register November 5–November 11, 2022):

Energy Department

87 FR 67461: Notice: “International Energy Agency Meetings” (November 8, 2022)

Environmental Protection Agency

87 FR 67901: Notice: “Methylene Chloride; Revision to Toxic Substances Control Act (TSCA) Risk Determination; Notice of Availability” (November 10, 2022)

87 FR 67617: Proposed Rule, Comments Close 12/9/22: “Air Plan Approval; Colorado; Serious Attainment Plan Elements and Related Revisions for the 2008 8-Hour Ozone Standard for the Denver Metro/North Front Range Nonattainment Area” (November 9, 2022)

87 FR 67570: Rule: “Delegation of New Source Performance Standards and National Emission Standards for Hazardous Air Pollutants for the States of Arizona and California” (November 9, 2022)

Susquehanna River Basin Commission

87 FR 68224: Notice: “Projects Approved for Consumptive Uses of Water” (November 14, 2022)

Bureau of Land Management

87 FR 67306: Proposed Rule, Comments Close 1/6/23: “Update of the Communications Uses Program, Cost Recovery Fee Schedules, and Section 512 of FLPMA for Rights-of-Way” (November 7, 2022)

Ocean Energy Management Bureau

87 FR 67066: Notice, Comments Close 12/7/22: “Agency Information Collection Activities; Submission to the Office of Management and Budget for Review and Approval; Renewable Energy and Alternate Uses of Existing Facilities on the Outer Continental Shelf” (November 7, 2022)

Other Agencies

87 FR 68312: Proposed Rule, Comments Close 1/13/23: “Federal Acquisition Regulation: Disclosure of Greenhouse Gas Emissions and Climate-Related Financial Risk” (November 14, 2022)

87 FR 68194: Notice: “Notice of Lodging of Proposed Consent Decree Under the Clean Air Act” (November 14, 2022)

STATE ACTIONS—EXECUTIVE & LEGISLATIVE

PENNSYLVANIA DEPT. OF ENVIRONMENTAL PROTECTION PRESS RELEASES
DEP to Host Public Hearing Regarding Pocono Manor Permit Application for Wastewater Treatment (November 8, 2022)

PENNSYLVANIA EXECUTIVE AGENCIES (Pa. Bulletin Vol. 52, No. 46 November 12, 2022)

DEPARTMENT OF CONSERVATION AND NATURAL RESOURCES

52 Pa.B. 7002 Notice: “Conservation and Natural Resources Advisory Council Public Meeting”

DEPARTMENT OF ENVIRONMENTAL PROTECTION

52 Pa.B. 7002 Applications: “THE PENNSYLVANIA CLEAN STREAMS LAW AND THE FEDERAL CLEAN WATER ACT; 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”

 

Written by:
Ethan Durand, Research Assistant
Kendal Ashman, Research Assistant
Jackie Schweichler, Staff Attorney