December 1, 2022
The Foundation Mineral and Energy Law Newsletter
Pennsylvania – Oil & Gas
(By Joseph Reinhart, Sean McGovern, Matthew Wood and Gina Falaschi)
On June 25, 2022, the Pennsylvania Department of Environmental Protection (PADEP) published General Permit WMGR163 (Permit) in the Pennsylvania Bulletin, 52 Pa. Bull. 3632 (June 25, 2022). PADEP issued the Permit following a 60-day comment period that closed on March 15, 2022. As issued, the Permit authorizes the short-term processing, transfer, and beneficial use of oil and gas liquid waste to hydraulically fracture or otherwise develop an oil or gas well under the authority of the Solid Waste Management Act, 35 Pa. Stat. §§ 6018.101– .1003, and the Municipal Waste Planning, Recycling and Waste Reduction Act, 53 Pa. Stat. §§ 4000.101–.1904. The Permit covers facilities that process and beneficially reuse oil and gas liquid waste for no more than 180 consecutive days at any one time.
Any company interested in using the Permit must register its authorized activities with PADEP. 25 Pa. Code § 287.643. In addition, PADEP is prohibited from requiring an applicant to obtain a determination of applicability from the agency prior to the issuance of the final permit for the land application of material. See id. § 287.641(c), (d). The Permit is applicable to the same oil and gas facilities eligible for coverage under General Permit WMGR123 (“Processing and Beneficial Use of Oil and Gas Liquid Waste”), but with fewer conditions. Key provisions in the Permit include:
- An authorized facility may process and transfer oil and gas liquid waste for no more than 180 consecutive days during the Permit’s two-year coverage period and a permittee can only operate for a maximum of one year during that period.
…
July 1, 2021
RMMLF Mineral and Energy Law Newsletter
(By Joseph K. Reinhart, Sean M. McGovern, Gina N. Falaschi and Matthew C. Wood)
On June 22, 2021, a few weeks after hearing oral arguments, the Supreme Court of Pennsylvania dismissed as having been improvidently granted appeals by environmental advocacy group Protect PT to overturn two Penn Township Zoning Hearing Board (Board) decisions to grant special exceptions for gas well development in the township. Protect PT v. Penn Twp. Zoning Hearing Bd., 252 A.3d 600 (Pa. 2021) (mem.).
The companion cases originated from the Board’s 2018 decisions to approve special exception applications by Olympus Energy LLC (Olympus) to develop oil and gas operations at two well pads in Penn Township, Westmoreland County, Pennsylvania. In the hearings, Protect PT asserted that the cumulative impacts of the gas well development near residential neighborhoods could increase the probability of negative environmental, safety, and health impacts in the community. The Board ultimately approved Olympus’s applications, concluding the proposed development satisfied the requirements of the township’s zoning ordinance (subject to certain conditions) and that Protect PT failed to present sufficient, credible evidence to rebut the Board’s conclusion.
Protect PT first appealed the Board’s decisions to the Westmoreland County Court of Common Pleas, which denied the appeals and affirmed the Board’s decisions without taking additional evidence. Protect PT subsequently appealed to the Commonwealth Court of Pennsylvania. Before the commonwealth court, Protect PT argued that the Board capriciously disregarded the evidence presented to it in granting Olympus’s applications. See Protect PT v. Penn Twp. Zoning Hearing Bd., 238 A.3d 530 (Table), 2020 WL 3640001 (Pa. …
June 2, 2021
RMMLF Mineral Law Newsletter
(Joseph K. Reinhart, Sean M. McGovern and Casey J. Snyder)
On February 16, 2021, the Pennsylvania Commonwealth Court affirmed the Pennsylvania Environmental Hearing Board’s (EHB) decision to deny environmental groups’ petition for attorney’s fees after a settlement with the Pennsylvania Department of Environmental Protection (PADEP) in a third-party permit appeal over Sunoco Pipeline L.P.’s (Sunoco) Mariner East 2 pipeline because neither side acted in “bad faith.” Clean Air Council v. PADEP, 245 A.3d 1207 (Pa. Commw. Ct. 2021). After the plaintiffs settled the dispute at the EHB over permits issued to Sunoco for its Mariner East 2 pipeline, the plaintiffs filed an application with the EHB to recover costs and fees of the litigation totaling nearly $230,000 from Sunoco, which was not a party to the settlement. Id. at 1210. The EHB applied a stricter standard for recovering fees from a private party than in applications to recover fees from PADEP, requiring the plaintiffs to show the private party acted in “bad faith.” Id. at 1211. Under this standard, the EHB reasoned, permittees would not be “dissuaded from vigorously protecting their interests . . . in good faith.” Id. (quoting Clean Air Council v. PADEP, 2019 EHB 228, 236). Finding no bad faith, the EHB denied the plaintiffs’ application for costs and fees. Id.
The plaintiffs appealed the decision to the commonwealth court, arguing that the EHB should have applied the less stringent “catalyst test,” which would have required the plaintiffs to meet an easier standard: that the opposing party provided some benefit the fee-requesting party sought, the suit stated a genuine claim, and their appeal was a substantial or significant reason why the opposing party provided the benefit the fee-requesting party sought in the underlying suit. …
March 12, 2021
RMMLF Mineral Law Newsletter
(by Joe Reinhart, Sean McGovern and Casey Snyder)
On November 18, 2020, Senate Bill 790 (SB 790), the Conventional Oil and Gas Wells Act, sponsored by Sen. Scarnati (R-Jefferson), was presented to Governor Tom Wolf for signature. Governor Wolf vetoed the bill on November 25, 2020. See Governor Wolf’s Veto Letter for SB 790 (Nov. 25, 2020). SB 790 would have set a legislative framework for regulations for the conventional oil and gas industry in Pennsylvania. See Memorandum from Sen. Scarnati to All Senate Members, “Conventional Oil and Gas Wells Act” (June 6, 2019). In his veto letter, Governor Wolf acknowledged the difficulty in regulating conventional and unconventional operations under Pennsylvania’s current program, which was updated by law in 2012 and by regulations for the unconventional industry in 2016. These updates were tailored to the new unconventional industry developing in the state, and placed new requirements on the conventional industry. Proposed regulations for the conventional industry were not promulgated in 2016 after the state legislature passed legislation requiring rules for the conventional industry to be promulgated separately from the unconventional rulemaking. See Pennsylvania Grade Crude Development Act, 58 Pa. Stat. §§ 1201–1208.
Governor Wolf cited several reasons for vetoing the bill and why he believed it posed a risk to the public health and environment. He characterized the bill as including “roll backs,” stating that protections for drinking water, public resources, spills, and erosion and sediment control are weakened for the conventional industry, which he alleged violates regulations at a rate “three to four times” higher than the unconventional industry. Additionally, he stated that several parts of the bill were “likely” unconstitutional under the Pennsylvania Constitution. …
April 30, 2020
The Legal Intelligencer
(by Daniel Hido and Hannah Baldwin)
There have been several notable developments recently regarding the Pennsylvania Department of Environmental Protection’s (PADEP) water quality standards regulations at 25 Pa. Code Chapter 93. First, on Jan. 31, the Pennsylvania Independent Regulatory Review Commission (IRRC) approved updates set forth as part of PADEP’s triennial review of the state’s water quality standards. Second, significant changes to the water quality standard for manganese moved closer to becoming law when the Pennsylvania Environmental Quality Board (EQB), a 20-member independent board that reviews and adopts PADEP proposed regulations before publication for public comment, approved PADEP’s proposed rulemaking on Dec. 17, 2019. Finally, PADEP continues work on a final rulemaking with respect to several proposed Class A stream redesignations after receiving comments from the IRRC on June 6, 2019.
PADEP implements the Chapter 93 instream water quality standards by first setting designated uses of surface waterbodies in Pennsylvania, and then by implementing water quality-based effluent limitations in NPDES permits to achieve or maintain the instream water quality of the receiving water, where applicable. Thus, changes to the Chapter 93 water quality standards may result in new or revised effluent limits for any facility that holds an NPDES permit.
Updated Triennial Water Quality Standards
Under Section 303(c) of the Clean Water Act, 33 U.S.C. Section 1313(c), PADEP is required to review and modify, as appropriate, the state’s water quality standards at least every three years. The Chapter 93 water quality standards were last updated in July 2013. The current updates were first proposed in October 2017.
The revised water quality standards make several changes to Table 3 (specific water quality criteria) and Table 5 (human health and aquatic life criteria for toxic substances) in Chapter 93. …
November 30, 2018
The American Oil & Gas Reporter
(by Jean M. Mosites, Keith J. Coyle and Krista-Ann M. Staley)
PITTSBURGH–The Marcellus and Utica shale plays account for some 30 percent of total U.S. natural gas output, compared with only 3 percent a decade ago. The Appalachian Basin’s rapid growth in natural gas and natural gas liquids production has occurred despite relatively low natural gas prices, driven by greater well productivity from improved drilling and completion techniques, including longer laterals and optimized well spacing.
Additionally, infrastructure build-out in the region, including the development of significant interstate pipeline projects featuring large-scale transmission of natural gas and NGLs (such as the Rover, Nexus and Mariner East 1 projects), has allowed access to Northeast population centers to increase demand for Appalachian-derived natural gas resources. Continued innovations in the industry, such as improvements to water logistics, likely will be important to reduce operational costs and further improve efficiency to maintain growth.
While the industry continues forging ahead in the Marcellus, Utica and conventional Appalachian plays, the legal landscape continues to evolve with everchanging federal and state environmental and safety regulations, along with a variety of local government requirements across the basin. The federal and state courts, legislatures and regulatory agencies continue to address a variety of issues that affect all facets of oil and gas development in the multistate region.
These decisions and developments not only affect drilling and production, but also the midstream and transportation infrastructure that is so critical to Appalachian producers’ ability to market their production. This article summarizes developments in the legal and regulatory landscape facing oil and gas producers and midstream operators in the Appalachian Basin.
In October 2016, the Marcellus Shale Coalition filed a petition in the Pennsylvania Commonwealth Court challenging seven new provisions in 25 Pa. …
Michele Siekerka, the chairman of the Delaware River Basin Commission (DRBC) who represents New Jersey Governor Chris Christie on the commission, recently issued a statement outlining the steps being taken by DRBC to reach a decision on natural gas drilling within the Delaware Basin. DRBC is apparently evaluating scientific studies and new regulations, practices and standards adopted by state and federal agencies. DRBC is also performing water quality and quantity monitoring to establish baseline conditions prior to the start of natural gas drilling activities within the Delaware Basin. …
Hess Corporation and Newfield Exploration Company recently terminated lease agreements with about 1,300 property owners in Wayne County, Pennsylvania, where the Delaware River Basin Commission (DRBC) has imposed a moratorium on gas drilling since May 2010. The moratorium is not intended to be permanent, but only until the DRBC develops environmental regulations for drilling in the watershed. The landowners received a combined $150 million (at $3,000 per acre) initially, and would have received an estimated $187 million in royalties had the wells been drilled. …
The Corning Leader reports that, in response to Governor Corbett’s recent letter to the Delaware River Basin Commission, a 1,300 member landowner group has threatened to sue the DRBC. The Northern Wayne Property Owners Alliance sent a letter to the executive director of the DRBC threatening a lawsuit unless the Commission schedules a vote on regulations that would allow drilling to begin. …
Responding to Governor Corbett’s recent letter urging the Delaware River Basin Commission (DRBC) to take action to end its moratorium on gas development, the Delaware Riverkeeper Network sent DRBC a memorandum defending the moratorium and responding to leaseholder claims that DRBC’s inaction constitutes an uncompensated regulatory taking. Delaware Riverkeeper emphasized that the moratorium does not deprive landowners of all economically beneficial use of their land, and that economic loss resulting from the moratorium is mitigated by the ability to use the land for other reasonable purposes. …
The Delaware River Basin Commission has advised that it will conduct a review of two completed pipeline projects in Northeast Pennsylvania, a reversal of its prior position. DRBC Executive Director Carol Collier made the decision after the Commission decided at its December 2012 meeting that Collier should assess whether the DRBC should review the projects. The projects are interstate pipelines built by Columbia Gas Transmission and Tennessee Gas Pipeline Co. …