Last week the Federal Energy Regulatory Commission (FERC) made some headway in how it evaluates greenhouse gas (GHG) emissions from natural gas-related projects. In recent FERC pipeline certification proceedings, the two Democrats on the Commission have been critical of how FERC addresses a project’s potential GHG emissions and climate change impacts. With only four active

On Friday, a court ruling provided some clarity regarding the Clean Water Act (CWA) § 401 water quality certification process. As forecasted in our November 1, 2018 blog post (below), the US Court of Appeals for the DC Circuit has ruled that a state waives its CWA § 401 authority when, pursuant to a written agreement, an applicant repeatedly withdraws and resubmits its request for water quality certification in order to restart the one-year waiver clock. Hoopa Valley Tribe v. FERC, No. 14-1271 (D.C. Cir. Jan. 25, 2019). According to the Court’s opinion, this sort of arrangement serves to circumvent the Federal Energy Regulatory Commission’s (FERC) “congressionally granted authority over the licensing, conditioning, and developing of [the] project,” and “if allowed, the withdrawal-and-resubmission scheme could be used to indefinitely delay federal licensing proceedings and undermine FERC’s jurisdiction to regulate such matters.”
Continue Reading

2018 was a banner year for M&A activity in the energy space, with numerous high dollar value transactions in the upstream, midstream, downstream and oil field services (OFS) segments. As investors in the public securities markets have shown a significantly decreased appetite for new issuances of equity by energy companies, the preferred exit or growth strategy for 2018 has been through strategic mergers, acquisitions or divestitures. These transactions have manifested themselves in various forms: asset acquisitions and divestitures, private equity investment into “drillcos” with strategic oil and gas companies, public-public mergers between OFS companies and upstream shale drillers, and simplification transactions by master limited partnerships (MLPs) in the midstream space. In addition to all this M&A activity, one element has become significantly more prevalent in the oil and gas industry throughout 2018 and shows no signs of letting down for 2019: water.
Continue Reading

In recent litigation involving the development of interstate natural gas pipelines, one of the key issues has been whether the state has waived its authority under Clean Water Act section 401 by exceeding the one-year time period. In a separate case involving a series of hydroelectric facilities, the waiver period was again directly at issue. On October 1, at oral argument before the D.C. Circuit, the parties addressed whether California and Oregon had waived their water quality certification authority by having the applicant withdraw and resubmit its request for certification over a number of years. Notably, the judges seemed to agree that FERC could make a waiver determination before the end of the one-year time limit and that withdrawing and resubmitting an application may not always restart the clock.
Continue Reading

Earlier this month, the Pipeline and Hazardous Materials Safety Administration and the Federal Energy Regulatory Commission announced their intention to develop a memorandum of understanding (MOU) that would refine and reduce the permit application review process for proposed Liquefied Natural Gas (LNG) facilities. The announcement’s description of what the MOU will accomplish is consistent with the April 2018 multi-agency MOU: “The MOU will clarify each agency’s respective role in the permitting process for potential LNG projects, and implement procedures into the FERC’s authorization process that will leverage PHMSA’s safety expertise to evaluate potential impact to public safety.”

Continue Reading

On July 10, 2018, a panel of the United States Court of Appeals for the DC Circuit rejected an environmental group’s claim that FERC’s funding mechanism results in unconstitutional bias in favor of the pipeline industry. The court also rebuffed a due process attack on the Commission’s use of “tolling orders” to avoid automatic denial of rehearing requests after 30 days. The decision is noteworthy as it represents the latest rejection of similar constitutional challenges to FERC’s operations and practices that pipeline opponents have been raising with increasing frequency. The ruling also highlights the difficulty of bypassing the Natural Gas Act’s administrative rehearing and judicial review process through novel broadside attacks on the Commission’s general practices and procedures.

Continue Reading

As the Trump Administration is pushing forward on its deregulatory agenda and, in particular, its efforts to improve the Endangered Species Act and its implementation by the US Fish and Wildlife Service and National Marine Fisheries Service, the Supreme Court is poised to hear a landmark case on designation of critical habitat under the ESA that could provide some guideposts for the services’ new regulations.
Continue Reading

In a decision issued on April 12, 2018, a Fourth Circuit panel held (2-1) that (1) even though a pipeline leak has been repaired and remediation is ongoing under the supervision of the state environmental agency, environmental groups have standing to sue the pipeline owner, and (2) plaintiffs’ allegation that groundwater continues to carry discharged pollutants to jurisdictional waters through a “direct hydrological connection” supports liability under the Clean Water Act.
Continue Reading

On March 12, 2018, the United States Court of Appeals for the Second Circuit affirmed a Federal Energy Regulatory Commission (FERC) order finding that delays by the New York Department of Environmental Conservation (NYDEC) in reviewing Millennium Pipeline Company’s application for water quality certification constituted waiver of NYDEC’s authority under the Clean Water Act (CWA). As we detailed in an earlier blog post, FERC found that NYDEC’s delay exceeded the one-year statutory period established by CWA Section 401. The Millennium case is just one of several interstate natural gas pipeline projects that have faced delays associated with the CWA Section 401 permitting process. (See, e.g., Atlantic Bridge Project, Atlantic Sunrise Project, Constitution Pipeline, Northern Access Project, PennEast Pipeline, and Spire STL Pipeline.) The Court’s decision resolves the nearly three-year permitting process for the Millennium Valley Lateral Pipeline and clarifies for other projects (and state agencies reviewing those projects) that the one-year waiver period begins when the state agency receives the initial request for certification.
Continue Reading