Jeremy A. Mercer
Lessees of oil and gas leases in Pennsylvania who have been assigned or are assigning less than all of the geologic strata under lease should give careful attention to whether those leases have been severed vertically by unilateral actions. A lease may not be held by production if that production is in a geologic strata not included in the assignment of rights. This article explains a recent decision on the issue.
By its 2-to-1 non-precedential decision that an oil and gas lease unilaterally can be severed horizontally and vertically, the Superior Court of Pennsylvania appears to have split from its own published precedent and created new law in Pennsylvania—leaving lessees in limbo, possibly giving unscrupulous lessors a unilateral tool to terminate oil and gas leases, and ultimately harming both lessors and lessees in the process. Continue reading “Under Scrutiny: PA Superior Court Splits from Own Precedent and Allows Unilateral Oil & Gas Lease Severance in Montgomery“
Jeremy A. Mercer, Amy L. Barrette, and Elizabeth E. Klingensmith
Under Pennsylvania law, a defined primary term of an oil and gas lease may actually be longer than that stated term of year. In a September 12, 2017, unreported decision, the Pennsylvania Superior Court remanded a case to the trial court for consideration of whether a “limitation of forfeiture” provision, which required notice and opportunity to cure, extended the primary term by the length of the cure period. See L.D. Oil & Gas Enters., Inc. v. Loop, No. 1883 WDA 2016, 2017 WL 4001655 (Pa. Super. Ct. Sep. 12, 2017). In overturning the trial court’s grant of judgment on the pleadings to the lessor, the Superior Court returned the case to allow the trial court to take parol evidence of the impact of the “limitation of forfeiture” provision on the length of the primary term. Continue reading “Not So Fast—Your Oil and Gas Lease Primary Term May Be Longer Than You Thought”
Michael L. Krancer, Frederick M. Lowther, and Margaret Anne Hill
As we have noted in our prior blog posts on the Constitution Pipeline and Millennium Valley Lateral projects, §401 of the Federal Clean Water Act has become a focal point in the growing efforts by States to exercise dominant authority over FERC jurisdictional pipelines. This time, the West Virginia Department of Environmental Protection (“WVDEP”) has taken the unprecedented step of actually revoking a §401 certification it had granted in March 2017 and then reaffirmed in May. This action by WVDEP may be the final straw in State authority to review FERC jurisdictional pipelines as FERC and the Congress will be energized to react to the oversteps by New York in Millennium and now West Virginia in Mountain Valley. Continue reading “Mountain Valley Pipeline: West Virginia Cements the Need for FERC and Congressional Action to Curb State Overreach on FERC Jurisdictional Pipelines”
Frederick M. Lowther and Michael L. Krancer
On August 30, 2017, the New York State Department of Environmental Conservation (“NYSDEC”) issued a two-page letter (signed by the General Counsel of NYSDEC), which denies “conditionally” a water quality certification under §401 of the Federal Clean Water Act (“CWA”). As with the two prior denials (noted below), this denial has the effect of preventing construction of the eight-mile Valley Lateral Pipeline, which is part of the Millennium Pipeline intended to serve the 680 MW gas-fired CPV Valley Energy Center in Wayawanda, Orange County, NY, currently under construction. The “conditional” denial becomes unconditional in the event Federal Energy Regulatory Commission (“FERC”) does not grant NYSDEC’s petition to FERC filed last month to reconsider its approval of the line in light of “new law,” namely the recent D.C. Circuit decision Sierra Club v. FERC, 2017 WL 3597014 (D.C. Cir., August 22, 2017) (“Sierra Club”). Continue reading “Millennium’s Valley Lateral Project: Yet Another New York State Veto under the Clean Water Act”
Frederick M. Lowther and Frank L. Tamulonis III
In an abrupt departure from long-standing precedent, the D.C. Circuit ruled on August 22, 2017 that, in approving a natural gas pipeline project, the Federal Energy Regulatory Commission (“FERC”) failed to consider potential “downstream” greenhouse gas emissions from power plants burning natural gas supplied by the pipeline when preparing an environmental impact statement (“EIS”) pursuant to the National Environmental Policy Act (“NEPA”). Continue reading “D.C. Circuit Significantly Expands the Scope of FERC Pipeline Reviews”
First business meeting set for September 20. NEXUS Natural Gas Pipeline leads the list of backlog of projects awaiting approvals.
New FERC Commissioner Robert Powelson, formerly of the Pennsylvania Utility Commission and former President of NARUC, was sworn last Thursday, giving the Commission a quorum for the first time in six months.
Continue reading “FERC Gets Quorum and New Acting Chairman”