Use of the New State Construction Notices Directory for Oil and Gas Construction Projects

Use of the New State Construction Notices Directory for Oil and Gas Construction Projects

An article in the March 2017 issue of The PIOGA Press, co-authored by Babst Calland Attorneys Dave White and Esther Soria Mignanelliaddresses the impacts of the recent amendments to the Pennsylvania Mechanics’ Lien Law (Act No. 142) and related newly created on-line State Construction Notices Directory on oil and gas infrastructure projects.

To view the full article, click here.

Ohio Rules Drafted for Construction of Well Sites

Ohio Rules Drafted for Construction of Well Sites

The Ohio Department of Natural Resources has drafted, for public comment, rules concerning well site construction.  The current draft requires submission of an application along with a set of detailed drawings, a sediment and erosion control plan, a dust control plan, a geotechnical report and a storm water hydraulic plan.  Babst Calland has more on the draft.

Construction Law 2013: A Year in Review

Construction Law 2013: A Year in Review

As a service to its clients and prospective clients, the law firm of Babst Calland will provide a complimentary “year in review” breakfast seminar which will cover an overview of 2013’s significant developments (both statutory and case-law) in the area of construction law. This year’s topics include:  CASPA, mechanics’ liens, payment bonds, pipeline construction, the Procurement Code and Public-Private Partnerships (“P3”). The seminar will be held on Tuesday, February 18, 2014 at the Doubletree Hotel in Greentree, beginning with a continental breakfast at 7:30 a.m., followed by the seminar at 8:00 a.m. For more information, please email Matt Jameson.  Speakers will include Kurt Fernsler, Matt Jameson, Rick Kalson, Dave White, Nino Legeza, and Dave McKenery.

 

 

Request To Expand Marcellus Shale Pipeline

Request To Expand Marcellus Shale Pipeline

Transcontinental Gas Pipe Line Company, LLC has applied with the Federal Energy Regulatory Commission for authorization to construct and operate the Leidy Southeast Project which would entail the installation of approximately 30 miles of new 42-inch pipeline and ancillary facilities in Northeastern Pennsylvania and Northern New Jersey.  Read more from Babst Calland’s Shale Energy Law Blog.

Plans Announced for New Processing Plant and Pipeline in Ohio

Plans Announced for New Processing Plant and Pipeline in Ohio

Kinder Morgan Energy Partners LP and MarkWest Utica EMG LLC have announced plans to construct a new natural gas processing plant and pipeline to transport liquids from Ohio, Pennsylvania, and West Virginia to the Gulf Coast region for processing.  Babst Calland has more about the project here.

Williams Approves Bluegrass Pipeline Project

Williams Approves Bluegrass Pipeline Project

According to a recent article in the Tulsa Business and Legal News, Williams’ board of directors has approved the development of a natural gas liquids pipeline which will primarily connect supply from the Marcellus and Utica shale formations to the demands of growing petrochemical markets along the Gulf Coast and in the Northeast.  Plans for the project include construction of the pipeline, a new fractionation plant and storage facilities.  Boardwalk Pipeline Partners is also involved in the project.  The companies, which are currently tackling permitting, public consultation and right-of-way acquisition, expect the pipeline to be in service in late 2015.

Pipeline Construction Continues In Region

Pipeline Construction Continues In Region

Rockford Corporation, a subsidiary of Primoris Services Corporation, has announced awards of five pipeline construction projects valuing approximately $92 million.  Four of the five projects will be located in Pennsylvania and/or West Virginia.  All of the projects are scheduled to be completed this year.  Read more about the company’s announcement here.

Federal Court in West Virginia Refuses to Enforce Choice of Law Agreement in Construction Contract

Federal Court in West Virginia Refuses to Enforce Choice of Law Agreement in Construction Contract

In Elk River Pipeline LLC v. Equitable Gathering LLC, S.D. W.Va. (2013), the United States District Court for the Southern District of West Virginia determined that West Virginia law governed a dispute between two parties to a construction contract despite the fact that the contract expressly stated that all disputes arising from that contract would be governed by the law of Pennsylvania. A copy of the Elk River decision is available here.

In Elk River, Equitable Gathering LLC (“EQT”) entered into a Master Service Agreement with Elk River Pipeline LLC (“Elk River”) for the construction of a section of pipeline in West Virginia. The Master Service Agreement stated that it would be “construed, interpreted and enforced in accordance with and shall be governed by the laws of the Commonwealth of Pennsylvania, excluding its conflict of law rules.” Despite this language, Elk River contended that West Virginia law should apply to the contract. The Court agreed, holding West Virginia law governs construction of the Master Service Agreement and requires a determination of whether a “substantial relationship” exists with the jurisdiction whose law was selected by the parties. Ultimately, the Court found that the contract did not have a substantial relationship with Pennsylvania, and therefore, the Court refused to enforce the contract’s choice of law provision.

Following the Elk River decision, contractors entering into construction contracts for projects in West Virginia should be careful to ensure that the choice of law provision in that construction contract selects the law of a state that has a substantial relationship with the contract.

 

Williams and Boardwalk Announce Joint Venture to Build NGL Pipeline in Marcellus and Utica

Williams and Boardwalk Announce Joint Venture to Build NGL Pipeline in Marcellus and Utica

Williams and Boardwalk Pipeline Partners LP recently announced that they would be forming a joint venture to develop a pipeline that would transport natural gas liquids (NGLs) from the Marcellus and Utica to petrochemical and export facilities on the Gulf Coast and in the Northeast.  The project, known as the Bluegrass Pipeline, would include constructing a new NGL pipeline in West Virginia and Ohio to interconnect with an existing gas transmission line in Kentucky; converting a portion of that gas transmission line to NGL service; and constructing new fractionation and additional pipeline and storage facilities in Louisiana.  Williams and Boardwalk expect the Bluegrass Pipeline to be placed into service in the second half of 2015.  Additional information on the project is available here.

Construction Law Issues Impact the Expansion of Natural Gas Pipelines in the Region

Construction Law Issues Impact the Expansion of Natural Gas Pipelines in the Region

As the natural gas industry expands in the region, energy and midstream companies and their contractors need to be aware of the unique Pennsylvania construction law issues that may impact development.

Although Pennsylvania courts have not yet addressed whether natural gas construction activities constitute an “improvement” under the Pennsylvania Mechanics’ Lien law, contractors and subcontractors may have mechanics’ lien rights for services rendered. Thus, it is undecided whether the lien would attach to the fee simple interest of the owner of the real property at issue, or whether a lien claimant is limited to attaching its lien to the leasehold interest of either the lessee or easement holder.

Although also not yet addressed by a Pennsylvania appellate court, it seems clear that the Pennsylvania Contractor and Subcontractor Payment Act (CASPA) applies to contracts entered into for natural gas development. Under CASPA, owners of construction projects must pay contractors according to the terms of their contracts. If owners fail to do so, courts may award the contractor interest along with penalty fees and attorneys’ fees. Furthermore, under CASPA a venue and/or choice of law provision selecting a venue outside of Pennsylvania or seeking to apply non-Pennsylvania law is unenforceable.