Administrative Watch
On September 30, 2015, the U.S. Environmental Protection Agency (EPA) released a pre-publication version of the final rule to amend the Steam Electric Power Generating Effluent Limitation Guidelines and Standards (ELGs) at 40 C.F.R. Part 423. The final rule imposes more stringent effluent limitations for many types of wastewater discharges from both existing and new coal-fired steam electric power plants, and contains significant changes from the proposed rule.
Administrative Watch
On August 26, 2015, seven environmental groups sent the U.S. Environmental Protection Agency (EPA) a Notice of Intent to Sue the agency in an attempt to force the agency to develop tailored rules for oil and gas wastes under the Resource Conservation and Recovery Act (RCRA) Subtitle D solid waste program. The groups argued that the agency has not within the statutorily required three-year timeframe (1) reviewed and, where necessary, revised RCRA’s Subtitle D solid waste regulations for oil and gas wastes, and (2) reviewed and/or revised its guidelines for state solid waste management plans for oil and gas wastes.
Administrative Watch
The Pennsylvania Supreme Court recently handed down its opinion in Harley-Davidson Motor Co. v. Springettsbury Twp., — A.3d — (2015), in which the Court discusses the impact of environmental contamination on a property’s value for real estate taxation purposes, when the current owner is a party to an agreement with the government to remediate the contamination.
The PIOGA Press
The United States Environmental Protection Agency (EPA) recently released several proposals seeking to reduce greenhouse gas and other emissions from the oil and natural gas sector. EPA’s proposals are part of the Obama administration’s larger Climate Action Plan, a goal of which is to reduce methane emissions from the oil and gas industry by 40 to 45 percent from 2012 levels by 2025. EPA also stated that the proposals seek to protect public health by seeking to reduce emissions of volatile organic compounds (VOCs), a precursor to ground-level ozone formation. In addition to these emissions related measures, EPA also released a proposed rule intended to clarify single source determinations for entities within the oil and gas industry. Together, these proposals will likely affect a wide array of facilities within the industry, including natural gas well sites, processing plants, compressor stations and storage facilities.
Administrative Watch
On September 14, 2015, the Commonwealth Court of Pennsylvania issued a much-anticipated ruling that overturned a decision of the Lycoming County Court of Common Pleas which found the development of a natural gas well pad in a Residential Agriculture zoning district not to be similar and compatible with other uses in that zoning district. The decision in Gorsline v. Board of Supervisors of Fairfield Township, 1735 C.D. 2014 addressed the compatibility of natural gas development in a zoning district consisting of mixed residential and agriculture uses. This ruling is significant because of the amount of natural gas development in the Commonwealth that takes place in similarly situated zoning districts.
The PIOGA Press
It is common for oil and gas leases in Pennsylvania to allow for the storage of natural gas. Pennsylvania case law regarding dual-purpose oil and gas leases, which grant both production rights and storage rights, is complex and provides very fact-specific holdings which may not be applicable to every dual-purpose lease. However, in this past year, two favorable decisions have been issued providing a better understanding of the status of such a lease that is held by storage operations alone.
The Legal Intelligencer
The mandated creation of a State Construction Notices Directory to track work on construction projects costing in excess of $1.5 million was one of the many changes made to the Pennsylvania Mechanic’s Lien Law in 2014. To accompany the new directory, the Pennsylvania Legislature also passed several new notice requirements to apply to these construction projects.
Although the new notice procedure is not anticipated to go into effect earlier than December 2016, members of the Pennsylvania construction industry should begin now to familiarize themselves with the changes to the Lien Law to determine how to change their business practices to meet the requirements. Other states’ laws and precedent can be a useful tool in helping owners, subcontractors and their lawyers jumpstart this process. Specifically, the 2014 amendments make Pennsylvania’s mechanic’s lien procedure similar to Ohio, as both the new notice-of-commencement and notice-of-furnishing filings have been required in Ohio for years.
The Anticipated Directory
In October 2014, Act No. 142 was enacted, amending the Pennsylvania Mechanic’s Lien Law, 49 P.S. Section 1101 et seq., and creating a more structured notice procedure for owners and subcontractors to follow. Specifically, the act permits the following four types of filings within the directory: (1) notice of commencement; (2) notice of furnishing; (3) notice of completion; and (4) notice of nonpayment.
A notice of commencement will be filed by an owner prior to the start of construction and must contain: (1) the full name, address and email address of the contractor; (2) the full name and location of the searchable project; (3) the county in which the searchable project is located; (4) a “legal description” of the property, including the tax identification number of each parcel included in the searchable project; …
Administrative Watch
The U.S. Environmental Protection Agency (EPA) recently unveiled a number of regulatory proposals aimed at reducing greenhouse gas emissions from the oil and natural gas industry and clarifying how sources in the industry are to be evaluated for air permitting purposes. These highly-anticipated proposals have the potential to affect sources located across various segments of the industry, including but not limited to operations at natural gas well sites, processing plants, compressor stations, and storage facilities. EPA is or will be accepting public comments on all of the proposals.
PIOGA Press
This article highlights an excerpt of the recently published 2015 Babst Calland Report – Appalachian Basin Oil and Gas Industry: Rising to the Challenge, Legal and Regulatory Perspective for Producers and Midstream Operators.
With a large number of regulatory and legal issues unresolved for the industry, litigation will remain part of the landscape. Industry will continue to be required to litigate interpretations of statutes and rules by federal and state regulators and environmental groups—with, we hope, favorable outcomes such as in Citizens for Pennsylvania’s Future v. Ultra Resources, Inc. Industry will also continue to face issues related to the validity of leases and royalty payments. Finally, property owner claims of both personal injury and property impact from oil and gas development activities will continue, fueled by claims of groundwater contamination and adverse health effects of shale development.
Federal court refuses to aggregate compressor stations, dismisses Clean Air Act Citizens’ suit alleging violation of new source review
In a highly-anticipated decision, the U.S. District Court for the Middle District of Pennsylvania granted a motion for summary judgment in favor of a Pennsylvania natural gas operator in an air aggregation case filed by a citizens group. The decision was issued on February 23 in Citizens for Pennsylvania’s Future, and is the latest development in the debate over single source determinations. The court agreed with the permitting decisions made by Department of Environmental Protection that the compressor stations at issue were not located on adjacent properties and thus should not be treated as a single source of emissions. The court disagreed with the Citizens for Pennsylvania’s Future’s (PennFuture) argument that the compressor stations were functionally interrelated and, therefore, should be aggregated as a single source. …
The Legal Intelligencer
With a growing number of townships, boroughs and cities experiencing fiscal challenges, many municipalities have increased or are considering increasing their fees related to the administration of their zoning, subdivision and land development, and related ordinances as a means of generating additional revenue.
On one hand, it certainly is prudent for municipalities to examine and, where appropriate, to increase their fees to cover their actual administrative costs. However, they need to proceed cautiously when doing so. If the fees are not reasonably commensurate with the cost of services performed, they will be viewed as a “back-door tax” and be subject to legal challenge.
The Municipalities Planning Code, 53 P.S. Section 10101 et seq., which establishes the framework for zoning and land use regulation in Pennsylvania, expressly authorizes municipalities to charge fees in an amount sufficient to offset the costs borne by a municipality in processing and administering applications.
Specifically, the MPC authorizes municipalities to charge fees related to: (1) processing applications and reviewing plans filed under a subdivision and land-development ordinance, including fees to cover the “reasonable and necessary charges by [a] municipality’s professional consultants for review and report thereon”; (2) administering a zoning ordinance; and (3) conducting hearings before the zoning hearing board, including fees to cover the “compensation for the secretary and members of the zoning hearing board, notice and advertising costs and necessary administrative overhead connected with the hearing.”
A municipality’s authority to charge land-use permitting fees, however, is not without limitation. It is a well-settled principle of Pennsylvania law that these fees must be reasonable and commensurate with the cost of the services performed by the municipality. A party wishing to challenge a fee has at least two options. …
Administrative Watch
On June 29, 2015, the U.S. Supreme Court ruled in Michigan v. EPA that the U.S. Environmental Protection Agency (EPA) failed to properly consider compliance costs before promulgating the Mercury and Air Toxics Standards (MATS) rule for fossil fuel-fired power plants under Section 112 of the Clean Air Act (CAA). The Supreme Court’s decision could influence future EPA rulemakings and comes at a time when the agency is putting the final touches on a controversial suite of air regulations aimed at reducing carbon dioxide emissions from power plants.
Employment Bulletin
Less than one month after the United States Supreme Court issued its landmark decision legalizing gay marriage nationwide, the U.S. Equal Employment Opportunity Commission (EEOC) issued a controversial interpretation in Complainant v. Anthony Foxx, Secretary, Department of Transportation (Federal Aviation Administration) in which it found that Title VII of the Civil Rights Act of 1964 prohibits discrimination based on an individual’s sexual orientation. The EEOC’s decision is a significant development in the law because it rejected several previous courts of appeals decisions holding that Title VII does not prohibit discrimination based upon sexual orientation. In this case, a supervisory air traffic control specialist with the Department of Transportation’s Federal Aviation Administration (FAA) filed an Equal Employment Opportunity (EEO) complaint alleging that the FAA subjected him to discrimination on the basis of sex. Specifically, the complainant alleged that he was discriminated against when he was denied a permanent position as a front line manager because he is gay. The EEO complaint was initially dismissed on timeliness grounds. The complainant appealed the dismissal to the EEOC, which reversed, concluding that the complainant’s allegations of discrimination on the basis of his sexual orientation stated a claim of discrimination on the basis of sex within the meaning of Title VII, and that such claim was timely. In light of its conclusion, the EEOC remanded the case for a decision on the merits.
The State Journal
With a growing team of attorneys and client base, Babst Calland has moved to a new location at BB&T Square in Charleston, WV’s downtown business district.
“Our team of West Virginia attorneys welcomes the move to BB&T Square in the center of our beautiful downtown district,” said Steven Green, shareholder and energy attorney at Babst Calland. “The new space will accommodate our continued growth while enabling our entire staff to better serve current and new clients.”
Babst Calland opened its Charleston office in 2011, initially serving clients in the growing natural gas market in West Virginia and the Appalachian Basin. The office has grown steadily since then, and last year added a team of senior West Virginia attorneys in lateral moves from two other local firms. The firm focuses on representing clients through a multi-disciplinary team approach with attorneys in key practice areas, including energy and natural resources, environmental, employment and labor, business services, title, litigation, land use, and construction law.
The firm has more than 30 attorneys admitted to practice in West Virginia who have been serving the natural gas, coal and other industries for many years.
Its new Charleston office is located at 300 Summers St., Suite 1000.
Babst Calland also has offices in Pittsburgh and State College, PA., as well as Canton, Oh and Sewell, N.J.
Pittsburgh Tribune Review
In a depressed natural gas market in which every dollar counts for drillers, Jay Hammond tries to help people make deals efficiently.
The attorney joined Downtown Pittsburgh-based Babst Calland last month and advises energy companies on transactions including leasing, joint venture agreements, and mergers and acquisitions.
U.S. remained world’s largest producer of petroleum and natural gas hydrocarbons in 2014.
PITTSBURGH, PA, June 12, 2015 – The law firm of Babst Calland today released its fifth annual energy industry report called, “The 2015 Babst Calland Report – Appalachian Basin Oil and Gas Industry: Rising to the Challenge; Legal and Regulatory Perspective for Producers and Midstream Operators.” This annual review of energy and natural resources development activity acknowledges the continuing evolution of this industry in the face of economic, regulatory, legal and local government challenges.
In this report, Babst Calland attorneys provide insights into Marcellus and Utica shale issues, challenges and recent developments most relevant to Pennsylvania, Ohio and West Virginia. In general, a significant challenge ahead for shale developers in the current price environment is for operators to continue to be productive and active in finding land and drilling wells while effectively delivering the natural resource to market.
According to the U.S. Energy Information Administration, regional and national natural gas production reached an all-time high at the end of 2014. Thus far in 2015, the oil and gas industry’s rig count in the Appalachian Basin and elsewhere is down substantially compared to the previous two years. Although Marcellus shale development is leading the way in the U.S. natural gas production by producing 17 million cubic feet per day of gas, persistently low gas prices are forcing producers to curtail capital expenditures, adjust staffing and wring cost savings from their respective supply chains.
Joseph K. Reinhart, shareholder and co- chair of Babst Calland’s Energy and Natural Resources Group, said, “This Report identifies the many challenges faced by the oil and gas industry, including commodity pricing, efforts to impose or increase taxes, pipeline capacity, vocal opposition, environmental and litigation challenges, impacts of local regulation, and the growing importance of due diligence in asset transactions.”
The 44-page Report contains five sections, each addressing key challenges for Appalachian Basin oil and gas producers and midstream operators. …