District of North Dakota Halts Bureau of Land Management’s Venting and Flaring Rule
On Thursday, September 12, 2024, Judge Daniel Traynor of the U.S. District Court for the District of North Dakota granted a preliminary injunction sought by North Dakota, Montana, Texas, Wyoming, and Utah (the States) to halt the April 2024 “Waste Prevention, Production Subject to Royalties, and Resource Conservation” rule from the Bureau of Land Management (BLM), which mandates that oil and gas well operators on federal land flare rather than vent excess methane gas. The April 2024 rule revised a 2016 BLM rule that the District of Wyoming vacated in 2020. The States raised a number of challenges to the April 2024 rule, arguing that it exceeded BLM’s statutory authority under, or violated, the Mineral Leasing Act, Federal Oil and Gas Royalty Management Act, Clean Air Act, and Federal Land Policy and Management Act and was otherwise arbitrary and capricious under the Administrative Procedure Act.
U.S. EPA Issues Draft Final Oil and Gas Methane Rule
The U.S. Environmental Protection Agency (EPA) released a draft of its final oil and gas methane rule on December 2, 2023. It may be some time before the final rule is officially published in the Federal Register, starting the clock on the rule’s compliance obligations. Interested parties will need that extra time to fully digest the 1,690-page draft final rule, which addresses methane emissions from new (in subpart OOOOb) and existing sources (in subpart OOOOc). Here are some of the rule’s key aspects to consider. (more…)
FERC Opens 2023 With Leadership Transition
Former U.S. Federal Energy Regulatory Commission (FERC or the Commission) Chairman Richard Glick has officially departed the independent Commission after failing to secure a reconfirmation hearing before the Senate in December 2022. Glick’s departure leaves the Commission with a 2–2 split between Democrats and Republicans that could stall a number of major initiatives that were ongoing under the former Chairman and the Commission’s Democratic majority.
2022 Sidley Energy Enforcement Update
This Sidley Energy Enforcement update covers:
- Federal Energy Regulatory Commission (FERC) approves settlement between Enforcement staff and Coaltrain
- Both FERC and Commodity Futures Trading Commission (CFTC) enforcement reports highlight the respective agency’s continued commitment to strong enforcement
- U.S. Court of Appeals for the Fifth Circuit upholds FERC’s finding that BP manipulated the natural gas market but remands to FERC to recalculate its $20 million penalty
- CFTC orders Glencore to pay a record-setting penalty of $1.186 billion
- CFTC and Securities and Exchange Commission (SEC) orders over $1.8 billion in fines against 11 firms for recordkeeping failure — employees using unapproved method of communications such as texts and WhatsApp on personal devices
U.S. FERC Issues Two Orders Clarifying the Scope of its Natural Gas Act Jurisdiction
On September 22, 2022, the U.S. Federal Energy Regulatory Commission’s (FERC) denied two separate complaints against natural gas pipelines located entirely within one state that turned on whether FERC had jurisdiction over the facilities under the Natural Gas Act (NGA). (more…)
Pipeline and Hazardous Materials Safety Administration Completes Gas “Mega Rule”
On August 24, 2022, the U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration (PHMSA) published in the Federal Register a final rule entitled Pipeline Safety: Safety of Gas Transmission Pipelines: Repair Criterial, Integrity Management Improvements, Cathodic Protection, Management of Change, and Other Related Amendments (Final Rule). (more…)
U.S. District Court Enjoins Biden Administration’s Nationwide Oil and Gas Leasing “Pause” Following Fifth Circuit’s Remand
On August 18, 2022, the federal district court for the Western District of Louisiana (the District Court) enjoined the nationwide pause of oil and gas leasing by the Biden administration (the Government). The District Court issued a permanent injunction just one day after the U.S. Court of Appeals for the Fifth Circuit (the Fifth Circuit) vacated and remanded the District Court’s order by which the District Court had previously issued a preliminary injunction enjoining the pause.
Fifth Circuit Says FERC Can’t Stop Rejection of Filed-Rate Contracts in Bankruptcy
On July 19, 2022, the U.S. Court of Appeals for the Fifth Circuit held that debtors in bankruptcy may reject regulated energy contracts, vacating two Federal Energy Regulatory Commission (FERC) orders to the contrary, in Gulfport Energy Corp. v. FERC. The question turned on how a party’s ability to reject executory contracts in bankruptcy interacts with FERC’s ability to determine whether a party can abrogate or modify contracts that constitute filed rates under a doctrine referred to as Mobile-Sierra. The court found that FERC cannot use its Natural Gas Act authority over contract abrogation and modification to countermand a debtor’s bankruptcy-law rights or the bankruptcy court’s powers.
Sidley Energy Enforcement Update
This Sidley Update addresses the following:
- District court judge finds that FERC may not pursue joint and several liability and disgorgement in Coaltrain case – FERC seeks interlocutory appeal.
- FERC Report on Enforcement highlights increased enforcement activity in 2021.
- FERC approves settlement between Enforcement staff and Golden Spread.
- FERC orders penalties against GreenHat Energy, LLC and individuals.
- DOJ and CFTC charge Puerto Rico resident and his firm for misappropriation of nonpublic information and fictitious trading.
U.S. Department of the Interior Releases Report on Federal Oil and Gas Leases
On November 26, 2021, the U.S. Department of the Interior (DOI) issued a long-anticipated report on federal oil and gas leases. The report focuses on the fiscal terms, leasing process, and remediation requirements of federal oil and gas leases. Notably, however, it does not discuss the possibility of banning new leases. (more…)
