Royalties
Shale Law Weekly Review – September 30, 2019
Pipelines: PHMSA Issues Three Final Rules Reinforcing Pipeline Safety Standards
On September 24, 2019, U.S. Secretary of Transportation Elaine L. Chao announced in a press release that the Pipeline and Hazardous Materials Safety Administration (PHMSA) issued three major final rules relating to federal pipeline safety. The three final rules include the gas transmission rule, the hazardous liquid rule, and the “Enhanced Emergency Order Procedures” rule. The gas transmission rule requires operators to confirm the Maximum Allowable Operating Pressure of older pipelines. In addition, this rule requires additional reporting and record retention standards. The […]
Shale Law Weekly Review – July 22, 2019
Post-Production Costs: Court Determines Oil and Gas Company Cannot Deduct Post-Production Costs from State Royalty Payments
On July 11, 2019, the Supreme Court of North Dakota ruled that Newfield Exploration Company (Newfield) could not deduct post-production costs incurred by the company from royalties paid to the state (Newfield Exploration Co. v. State of North Dakota, No. 20190088). Newfield filed the lawsuit to determine whether the royalty payments made to the State of North Dakota were correct after an audit of the company found the royalties were being underpaid according to the lease. Newfield was making royalty payments to the […]
Shale Law Weekly Review – June 24, 2019
Federal Lands: Department of Interior Issues Guidance on the Recalculation of Royalties Following Reinstatement of 2016 Rule
On June 13, 2019, U.S. Department of the Interior’s Office of Natural Resources Revenue (ONRR) issued a letter explaining that all federal oil and gas lessees, along with federal and Indian coal lessees, must recalculate royalty payments from January 1, 2017, to the present. The letter follows a ruling by the U.S. District Court for the Northern District of California, which vacated ONRR’s repeal of a 2016 rule titled, Consolidated Federal Oil & Gas and Federal & Indian Coal Valuation Reform (2016 rule). […]
Shale Law Weekly Review – June 11, 2019
Public Lands: Audit Finds Pennsylvania Failed to Collect Royalties from Oil and Gas Companies Developing on State Game Lands
On May 23, 2019, The Pennsylvania Auditor General released a Performance Audit Report (audit) for the Pennsylvania Game Commission (Commission), finding the Commission failed to adequately track oil and gas royalties from producers operating on state game lands. The audit lists several issues it found in the Commission’s accounting practices regarding the collection and monitoring of royalties owed. These issues include relying on data submitted by oil and gas producers without confirming the data’s accuracy, failing to audit producers […]
Shale Law Weekly Review – April 23, 2019
State Regulation: Colorado Governor Signs New Oil and Gas Regulations into Law
On April 16, 2019, Colorado Governor Jared Polis signed into law SB19-181, Protect Public Welfare Oil and Gas Operations. The new law amends the purpose of the state’s Oil and Gas Conservation Act by prioritizing public health, safety, welfare, and the environment when regulating oil and gas development. Notably, the bill provides local governments with greater authority to regulate the siting of drilling operations, inspect facilities, and impose fines for spills (p.1-2). In addition, the bill requires drillers to continuously monitor their air pollution and minimize their […]
