There are many issues revolving around beneficial use of produced water associated with hydraulically fractured oil and gas wells, from drought relief, to the abundance of produced water, to earthquakes. Will the numerous stakeholders align sufficiently to allow the creation of programs to properly regulate the beneficial use of produced water?
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“According to FERC, it is now commonplace for states to use Section 401 to hold federal licensing hostage.”

These are the words the DC Circuit used in Hoopa Valley Tribe v. Federal Energy Regulatory Commission, No. 14-1271, p. 10 (D.C. Cir., Jan. 25, 2019), to describe the state of play on § 401 certifications affecting hydroelectric facility licensing or re-licensing applications. CWA § 401(a)(1) requires, as a prerequisite for federal permits for activities that may result in a discharge into the navigable waters, that affected states certify that any such discharge will comply with applicable, enumerated provisions of the Clean Water Act. But, if a state fails or refuses to act on a request for certification within “a reasonable period of time (which shall not exceed one year) after receipt of such request,” the statute deems the certification requirements waived.
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Reversing a Texas Court of Appeals decision that allowed Anadarko’s Lloyd’s of London excess insurers to escape coverage for more than $100 million in defense costs incurred in connection with claims from the Deepwater Horizon well blowout, the Supreme Court of Texas held that the insurers’ obligations to pay defense costs under an “energy package” liability policy are not capped by a joint venture coverage limit for “liability” insured.  Anadarko Petroleum Corp. et al. v. Houston Casualty Co. et al., No. 16-1013 (Tex. Jan. 25, 2019).
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On January 17, 2019, the Federal Energy Regulatory Commission (Commission) held its monthly open meeting. The first half of the meeting was dedicated to remembrances of Commissioner McIntyre, who passed away earlier this month. The Commission elected to name the Commission meeting room in his honor.

Highlights of the second half of the meeting included:

In September 2018, the US Interior Department issued a final rule rescinding the 2016 Venting and Flaring Rule, which took effect November 2018. The old rule, which never went into effect, would have required oil and gas companies to capture leaked methane gas, repair and prevent leaks, and devise new plans to reduce the flaring and venting of natural gas. Following the effectiveness of the new rule, the applicable policies setting limits on releases of methane gas will mostly be left to individual states.
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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.
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On December 20, 2018, the Federal Energy Regulatory Commission (Commission) held its December 2018 open meeting. This was the first meeting for Commissioner Bernard McNamee, who was confirmed by the Senate on December 6, 2018. Given his recent confirmation, Commissioner McNamee voted present on the consent agenda. Commissioner McIntyre was absent due to continuing health issues and did not vote on the consent agenda.
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On November 15, 2018, the Federal Energy Regulatory Commission (Commission) held its monthly open meeting (November Meeting). This was the first meeting chaired by Chairman Chatterjee since replacing Commissioner McIntyre as chairman. Commissioner McIntyre was absent for his third consecutive open meeting due to continuing health issues and did not vote on the consent agenda.
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