October 4, 2021

Shale Law Weekly Review – Week of October 4, 2021

Pipelines: Ohio Supreme Court Approves Construction of the Central Corridor Pipeline despite Lack of Alternative Route ⚡
On September 22, 2021, the Ohio Supreme Court ruled that Duke Energy could proceed with the construction of the Central Corridor Pipeline through portions of Hamilton County, Ohio. The cities of Blue Ash and Reading along with a group of individuals challenged the construction of the pipeline arguing that the Ohio Power Sitting Board erred in allowing Duke Energy to submit a proposed route without a proposed alternative. The state Supreme Court agreed with plaintiffs’ argument; however, the court held that they could not establish they were harmed by the error. The Central Corridor Pipeline is designed to supply natural gas to customers in southwest Ohio.

Public Lands: The U.S. Interior Department Withdraws ONRR 2020 Valuation Reform and Civil Penalty Rule
On September 30, 2021, the U.S. Interior Department, Office of Natural Resources Revenue (ONRR) published in the Federal Register a final rule withdrawing the ONRR 2020 Valuation Reform and Civil Penalty Rule. Issued on January 15, 2021, the 2020 rule changed regulations (30 CFR Chap. XII, Parts 1206 and 1241) on how to calculate the value of oil and gas produced on federal lands for royalty purposes. Overall, this change allowed energy companies to pay less. The 2020 Rule was expected to take effect on November 1, 2021. In an announcement dated September 28, the Interior Department stated that “[t]he net impact of withdrawing the 2020 Rule is an estimated $64 million annual increase in royalty collections over what would have been realized if the 2020 Rule went into effect.”

National Energy Policy: The U.S. Department of Energy (DOE) Announces Significant Funding to Further Advance Cybersecurity in Manufacturing Processes and Supply Chains
On September 27, 2021, together with the Manufacturing Innovation Institute (CyManll), the U.S. Department of Energy (DOE) handed out over $1 million in funding five research projects for further advancing manufacturing processes and securing supply chains from cybercrime. The announcement reads, “The selected projects will work to not only increase the efficiency of the advanced manufacturing technologies that make our clean energy future possible, but will also directly address existing challenges that make them expensive and difficult to secure.”

Induced Seismicity: Texas Railroad Commission Requests Reduced Saltwater Well Disposal (SWD) Injection Activities in the Gardendale SRA
On September 24, 2021, the Texas Railroad Commission (TRC) issued a notice asking operators in the Gardendale Seismic Response Area (SRA), an area covering a part of the Midland Basin from northeast Ector County to southwest Martin Count, to decrease the amount of drilling fluid following a series of earthquakes (~M7.5 or greater) in the area. The TRC found that “SWD injection likely contribute[d] to seismic activity in the Gardendale SRA.”

Shale Law/Policy Resources of Interest:

Charles Sartain, Louisiana Federal Court Allows Injunctive Relief Under FERC Certificate of Public Convenience and Necessity (September 30, 2021).

Jeremy Mercer, Ohio Dormant Mineral Act Claim May Waive Attorney-Client Privilege (September 29, 2021).

John McFarland, Texas Senators Grill Railroad Commission Executive Director Wei Wang About Natural Gas Industry Winterization (September 29, 2021).

Michael B. Gerrard, Taking Climate Change to the International Court of Justice: Legal and Procedural Issues (September 29, 2021).

Micah Brown, Considering Carbon: Overview of Existing Market Structures (September 28, 2021).

John McFarland, Report Out on Christi Craddick Conflicts of Interest at Texas Railroad Commission (September 27, 2021).

AGENCY PRESS RELEASES – STATE/FEDERAL

Pennsylvania Department of Environmental Protection

DEP Announces $3 Million in Grants through Driving PA Forward Grant Program (September 29, 2021).

U.S. Department of Energy

DOE Announces up to $400 Million for Basic Research to Advance the Frontiers of Science (October 1, 2021).

DOE Announces New $2.5 Million Prize to Support Diversity in Innovation (September 30, 2021).

DOE Signs Up 125+ Local Governments to Fast-Track Solar Permits (September 28, 2021).

U.S. Environmental Protection Agency

West Texas Gas Companies Agree to Pay $3 Million Civil Penalty in Federal Settlement Requiring $5 Million in Safety Improvements and Clean Air Act Compliance at Eight Natural Gas Processing Plants (October 1, 2021).

EPA Releases Draft Strategic Plan to Address Climate Change and Advance Environmental Justice and Equity (October 1, 2021).

Chevron and American Refining Group Settle with the EPA Over Alleged Fuels Violations (September 30, 2021).

EPA Honors 2021 Green Power Leaders (September 28, 2021).

STATE ACTIONS—EXECUTIVE/LEGISLATIVE

Pennsylvania Executive Agencies—Actions and Notices (Pa. Bulletin Vol. 51, No. 40—October 2, 2021)

Department of Environmental Protection

51 Pa.B. 6320 Notice: “Stream Redesignation Evaluation of Chester Creek and Reynolds Run; Water Quality Standards Review.”

General Assembly

51 Pa.B. 6253 Concurrent Resolution: “Extending in whole the disaster emergency declared on August 31, 2021, in response to the aftereffects of Hurricane Ida.”

Pennsylvania Legislature

HB 591 “An Act amending. . . The Clean Streams Law, in other pollutions and potential pollution, further providing for potential pollution [Allowing for NPDES waivers on construction projects one to five acres in size].” Referred to Environmental Resources and Energy [Senate]. . . (September 28, 2021).

SB 806 “An Act amending. . . the Oil and Gas Lease Act, further providing for definitions, for payment information to interest owners and for accumulation of proceeds from production.” First consideration [Senate]. . . (September 28, 2021).

HB 1914 “An Act providing for plain language requirements in oil and gas real property contracts, for remedies and for penalties.” Referred to Environmental Resources and Energy [House]. . . (September 27, 2021).

Upcoming Meeting: House Environmental Resources and Energy Meeting on Monday, October 25, 2021.

FEDERAL ACTIONS—EXECUTIVE/LEGISLATIVE

Federal Executive Agencies (Federal Register September 27 – October 1, 2021):

Environmental Protection Agency

86 FR 54386 Final Rule; Extension of Submission Deadline: “Health and Safety Data Reporting; Addition of 20 High-Priority Substances and 30 Organohalogen Flame Retardants; Extension of Submission Deadline” (October 1, 2021).

86 FR 54107 Rule: “Approval of State Underground Storage Tank Program Revisions; Nevada” (September 30, 2021).

86 FR 54186 Notice: “Supplement to the 2019 Integrated Science Assessment for Particulate Matter (External Review Draft)” (September 30, 2021).

86 FR 53959 Notice: “Acid Rain Program: Excess Emissions Penalty Inflation Adjustments” (September 29, 2021).

86 FR 53577 Proposed Rule: “Parent Company Definition for Toxics Release Inventory (TRI) Reporting” (September 28, 2021).

Federal Energy Regulatory Commission

86 FR 54182 Notice: “Commonwealth LNG, LLC; Notice of Intent to Prepare an Environmental Impact Statement for the Proposed Commonwealth LNG Project, Request for Comments on Environmental Issues, and Revised Schedule for Environmental Review” (September 30, 2021).

86 FR 54178 Notice: “Tennessee Gas Pipeline Company, L.L.C.; Notice of Availability of the Final Environmental Impact Statement for the Proposed; East 300 Upgrade Project” (September 30, 2021).

86 FR 54178 Notice: “Transcontinental Gas Pipe Line Company, LLC; Notice of Petition for Declaratory Order [on Proposed Rates and Waivers]” (September 30, 2021).

86 FR 54180 Notice: “Texas Eastern Transmission, LP; Notice of Request Under Blanket Authorization and Establishing Intervention and Protest Deadline [for Authorization of a New Receipt Metering and Regulation Station]” (September 30, 2021).

86 FR 53958 Notice: “Mojave Pipeline Company, L.L.C.; Notice of Request Under Blanket Authorization and Establishing Intervention and Protest Deadline [for Construction of a Delivery Point in California]” (September 29, 2021).

86 FR 53650 Notice: “Columbia Gulf Transmission, LLC; Notice of Availability of the Final Environmental Impact Statement for the Proposed East Lateral Xpress Project” (September 28, 2021).

Land Management Bureau

86 FR 54469 Notice: “Filing of Plats of Survey, Nebraska and Wyoming [Protests Required Before November 1, 2021 Filing]” (October 1, 2021).

86 FR 53340 Notice: “Filing of Plats of Survey: Alaska [Protests Required Before October 27, 2021 Filing]” (September 27, 2021).

National Institute of Standards and Technology

86 FR 54168 Notice: “Agency Information Collection Activities; Submission to the Office of Management and Budget (OMB) for Review and Approval; Comment Request; National Cybersecurity Center of Excellence (NCCoE) Participant Letter(s) of Interest (LoI)” (September 30, 2021).

National Oceanic and Atmospheric Administration

86 FR 53947 Notice: “Taking and Importing Marine Mammals; Taking Marine Mammals Incidental to Geophysical Surveys Related to Oil and Gas Activities in the Gulf of Mexico” (September 29, 2021).

86 FR 53284 Notice: “Deepwater Horizon Oil Spill Regionwide Trustee Implementation Group Final Restoration Plan and Environmental Assessment 1: Birds, Marine Mammals, Oysters, and Sea Turtles and Finding of No Significant Impact” (September 27, 2021).

Natural Resources Revenue Office

86 FR 54045 Rule: “ONRR 2020 Valuation Reform and Civil Penalty Rule: Final Withdrawal Rule” (September 30, 2021).

House Energy and Commerce Committee Actions:

H.R.5389 “REDUCE Act of 2021 [‘To amend the Internal Revenue Code of 1986 to establish an excise tax on plastics’].” Referred to the Subcommittee on Coast Guard and Maritime Transportation. . . (September 28, 2021).

H.R.5383 “Grid Hardening Act of 2021 [‘To amend the Energy Independence and Security Act of 2007 to reauthorize the Smart Grid Investment Matching Grant Program, and for other purposes’].” Referred to the House Committee on Energy and Commerce. . . (September 27, 2021).

Senate Energy and Natural Resources Committee:

S.2896 “Department of Energy and Nuclear Regulatory Commission Whistleblower Protection Act.” Read twice and referred to the Senate Committee on Energy and Natural Resources. . . (September 29, 2021).

Follow us on Twitter @AgShaleLaw—Top #ShaleLaw HotLinks September 27–October 1, 2021:

After Hurricane Ida, Oil Infrastructure Springs Dozens of Leaks, New York Times

Texas Senators Blast Regulator for Power Grid Winterization Loophole Lawmakers Wrote into Law, Waco Tribune Herald

Rystad: China to Spend over $120 Billion on Services, Drill 118,000 Wells through 2025, Oil & Gas Journal

Gas Blowout near Los Angeles Leads to up to $1.8b Settlement, Associated Press

BP GOM Assets Back Online Following Hurricane Ida, Rigzone

EPA Finalizes Rule Cutting Use of Potent Greenhouse Gas Used in Refrigeration, The Hill

OPEC+ Seen Sticking to November Output Plans, despite $80 Oil, Sources Say, Reuters

German Regulator Grants PGNiG Participation in Nord Stream 2 Certification, Oil & Gas Journal

New Pa. Climate Action Plan Charts Path for Steep Cuts in Greenhouse Gases, Pittsburgh Post-Gazette

Line 3 Replacement Project Substantially Completed and Set to be Fully Operational, Cision PR Newswire

Texas Upstream Employment Grows, Rigzone