Justia Energy, Oil & Gas Law Opinion Summaries

The case involves Mountain Valley Pipeline, LLC (Appellee), which is constructing an interstate natural gas pipeline. The company acquired easements on properties along the pipeline’s route through condemnation actions under the Natural Gas Act. One such property was owned by Frank Terry, John Coles Terry, and Elizabeth Terry (Appellants), which was encumbered by temporary and permanent easements on 8.37 acres. After the district court granted Appellee immediate possession of the easements, the case proceeded to a jury trial to determine the amount of just compensation owed by Appellee to Appellants for the easements. The jury rendered a $523,327 verdict, which Appellee challenged, arguing that the verdict resulted from the jury improperly mixing expert testimony. The district court agreed with Appellee and granted judgment as a matter of law, vacating the jury verdict and entering a judgment for $261,033.The United States Court of Appeals for the Fourth Circuit reversed the district court’s judgment as a matter of law and remanded with instructions to reinstate the $523,327 verdict. The court held that the jury’s verdict was within the range of credited testimony and could be supported using residential values alone, without the need to venture beyond the credited testimony. The court also reversed the district court’s grant of a new trial. Additionally, the court vacated and remanded the district court’s order denying Appellants’ second motion for attorney’s fees and costs, leaving these issues for the district court to consider in the first instance. View "Mountain Valley Pipeline, LLC v. 8.37 Acres of Land" on Justia Law

This case involves a dispute over the Environmental Protection Agency's (EPA) implementation of the Clean Air Act’s Renewable Fuel Standards Program. The program requires the petroleum industry to introduce increasing volumes of renewable fuel into the nation's transportation fuel supply each year. However, Congress overestimated the speed at which domestic production of renewable fuel could expand, leading the EPA to reduce the statutorily required renewable fuel requirements annually.The case was brought before the United States Court of Appeals for the District of Columbia Circuit by two sets of petitioners. The first set, the Biofuel Petitioners, produce cellulosic biofuels and argue that the EPA's standards are set too low. The second set, the Refiner Petitioners, are fossil fuel refiners and retailers subject to the volume requirements and contend that the standards are too high.The court held that the EPA complied with the law and reasonably exercised its discretion in setting the renewable fuel requirements for the years 2020, 2021, and 2022. The court therefore denied the petitions for review. The court found that the EPA had the statutory authority to impose a supplemental volume for 2022 to make up for volume that should have been satisfied in 2016. The court also concluded that the EPA's new formula for calculating the annual percentage standards was not arbitrary or capricious. View "Sinclair Wyoming Refining Company LLC v. EPA" on Justia Law

The case revolves around the ownership of mineral rights beneath a dedicated street in Greeley, Colorado. The dispute arose between Great Northern Properties, LLLP (GNP) and Extraction Oil and Gas, Inc., Richmark Energy Partners, LLC, and Richmark Royalties, LLC (collectively, Extraction) over who is entitled to receive certain oil and gas royalty payments. The issue at hand was how to determine who holds title to the mineral estate under a dedicated right-of-way when a grantor, who has an interest in the mineral rights under that right-of-way, executes a conveyance of the land abutting the right-of-way that is silent as to those rights.The district court agreed with Extraction, concluding that the centerline presumption could be applied to a conveyance of the mineral estate beneath a right-of-way. The court of appeals affirmed the district court’s determination of law. However, the court of appeals also concluded that the centerline presumption should not apply if the grantor retains ownership of any property abutting the right-of-way.The Supreme Court of the State of Colorado affirmed the court of appeals' decision that a conveyance of land abutting a right-of-way is presumed to carry title to the centerline of both the surface and mineral estates beneath a dedicated right-of-way to the owners of land abutting that right-of-way. However, the Supreme Court reversed the court of appeals' conclusion that the centerline presumption cannot apply if a grantor retains ownership of any property abutting the subject right-of-way. The Supreme Court held that the centerline presumption applies if the party claiming ownership to land abutting a dedicated right-of-way establishes that the grantor conveyed ownership of land abutting a right-of-way, the grantor owned the fee to both the surface estate and the mineral rights underlying the right-of-way at the time of conveyance, and no contrary intent appears on the face of the conveyance document. View "Great Northern Properties v. Extraction Oil and Gas" on Justia Law

The City of Valdez in Alaska appealed two orders by the Regulatory Commission of Alaska (RCA) related to the transfer of the Trans-Alaska Pipeline System (TAPS) from BP Pipelines (Alaska) Inc. (BPPA) to Harvest Alaska, LLC. The first order (Order 6) approved confidential treatment of certain financial statements submitted by the oil company and its affiliates. The second order (Order 17) approved the transfer of a required certificate and the authority to operate the pipeline. The Superior Court dismissed Valdez’s appeals, concluding that Valdez lacked standing, failed to exhaust available administrative remedies, and the case was moot. The court also ordered Valdez to pay a portion of the attorney’s fees of the oil company and other companies involved in the proceedings.The Supreme Court of the State of Alaska reversed the dismissal of the appeal of Order 6, affirmed the dismissal of the appeal of Order 17, and vacated the award of attorney’s fees. The court found that Valdez had standing to appeal both orders, the appeals were not moot, and Valdez had exhausted administrative remedies with respect to Order 6 but not Order 17. The court remanded the case for further proceedings. View "City of Valdez v. Regulatory Commission of Alaska" on Justia Law

The case revolves around a lawsuit filed by Kyle Harris against Oasis Petroleum, Inc., and other parties, alleging negligence, gross negligence, intentional infliction of emotional distress, and negligent infliction of emotional distress. Harris claimed that he was injured in an explosion on an oil rig operated by Oasis while he was working as an employee of Frontier Pressure Testing, LLC. The district court dismissed the other parties from the action, leaving Oasis as the sole defendant.The case proceeded to a jury trial, where the jury found Oasis, Frontier, and Harris each at fault for and a proximate cause of Harris’s injuries. The jury apportioned the fault as follows: Oasis 15%; Frontier 65%; Harris 20%. The jury found $5,012,500 in monetary damages would compensate Harris for his injuries. The district court entered an order for judgment, applying N.D.C.C. § 32-03.2-02, and deducted 85% of fault attributable to Frontier and Harris from the total damages.Harris filed a statement of costs and disbursements, arguing he should be awarded certain costs and disbursements because he was the prevailing party under the special verdict of the jury. Oasis objected to Harris’s statement of costs and disbursements, challenging the amount of expert fees and that the testimony did not lead to a successful result. The district court approved Harris’s amended statement of costs and disbursements, concluding that Harris was the prevailing party and was entitled to costs and disbursements undiminished by the percentage of negligence attributed to him.Oasis appealed to the Supreme Court of North Dakota, arguing that the district court erred as a matter of law in determining Harris was a prevailing party and abused its discretion in awarding Harris costs and disbursements. The Supreme Court affirmed the district court's decision, agreeing with Harris that he was the prevailing party. The court held that Harris was the prevailing party, and the court had the discretion to award Harris costs and disbursements under N.D.C.C. § 28-26-06, without reduction by his percentage of fault. View "Harris v. Oasis Petroleum" on Justia Law

The case revolves around a dispute over oil and gas interests between Spottie, Inc., a Nevada corporation, and several other Nevada corporations and a limited liability company. Spottie alleged that the defendants had wrongfully claimed title to these interests, which were once owned by Edward Davis, who had formed Spottie as a holding company. The defendants countered that they had entered into an agreement with Davis to acquire these interests, and that Davis and Spottie had transferred the disputed interests to one of the defendants via an assignment in 2016.The district court dismissed several of Spottie's claims, leaving only a quiet title claim and a claim for unjust enrichment. After a three-day bench trial, the court ruled in favor of the defendants, finding that the assignment from Davis and Spottie to one of the defendants was valid. The court also found that Spottie had erroneously received revenue from the disputed interests and awarded damages to the defendants.Spottie appealed the decision, arguing that the district court had erred in its ownership determination, its rejection of Spottie's laches defense, its binding of a non-party to the judgment, and its award of attorney fees and costs. The Supreme Court of North Dakota affirmed in part, concluding that the district court did not err in its ownership determination and its award of attorney fees. However, it reversed in part, finding that the court had erred in awarding costs for non-legal expenses. The case was remanded for the court to recalculate its cost award and to consider the defendants' request for additional attorney fees and legal costs. View "SPOTTIE v. BAIUL-FARINA" on Justia Law

The case revolves around an oil spill caused by Plains All American Pipeline, L.P. (Plains). The spill resulted in the unlawful discharge of over 142,000 gallons of crude oil into the ocean and onto a beach. The trial court considered restitution for four groups of claimants who alleged losses due to the spill. The People of the State of California appealed the denial of restitution for claimants in two of these groups.The trial court had previously ruled that oil industry claimants were not direct victims of Plains' crimes and accepted mediated settlements in lieu of restitution. It also denied restitution to fishers based on a pending class action lawsuit, declined to consider aggregate proof presented by fishers, and refused to consider Plains' criminal conduct.The Court of Appeal of the State of California Second Appellate District Division Six held that restitution could not be denied based on mediated civil settlements or a class action lawsuit. However, it upheld the trial court's decision to deny restitution to fishers and oil industry workers, stating that they were not direct victims of the pipeline shutdown after the spill. The court remanded the case for consideration of restitution for four fisher claims, but in all other respects, it affirmed the trial court's decision and denied the writ petition. View "People v. Plains All American Pipeline, L.P." on Justia Law

The case originated as a class action dispute about the underpayment of oil and gas royalties due on wells in Oklahoma. The plaintiff, Chieftain Royalty Company, sued SM Energy Company, the operator of the wells, under various tort theories, including fraud, breach of contract, and breach of fiduciary duty. In 2015, the claims were settled for approximately $52 million. Following the settlement, Chieftain's counsel moved for attorneys’ fees, and Chieftain sought an incentive award for its CEO, Robert Abernathy. Two class members objected to the awards and appealed. The court affirmed the settlement but reversed the attorneys’ fees and incentive awards, remanding to the district court for further proceedings.On remand, the district court re-awarded the fees and incentive award. The class did not receive notice of the 2018 attorneys’ fees motion as required under Federal Rule of Civil Procedure 23(h)(1), so the court vacated the district court order awarding attorneys’ fees and remanded with instructions to direct class-wide notice of the 2018 attorneys’ fees motion and to re-open the period for objections. The court did not reach the merits of the appellate challenge to the re-awarded attorneys’ fees. The court affirmed the district court’s incentive award to Mr. Abernathy. View "Chieftain Royalty Company v. SM Energy Company" on Justia Law

Phoenix Capital Group Holdings, LLC, an oil and gas mineral rights investment firm, acquired mineral interests on two sections of real property in Richland County, Montana. The previous owner, Katherine Solis, had been approached multiple times by Kraken Oil and Gas LLC, an energy production company, to secure a lease of the mineral interests or to participate in drilling wells. Solis consistently refused to engage with Kraken. After Phoenix acquired the mineral interests, it expressed a desire to participate in the oil and gas production from the wells being drilled by Kraken. However, Kraken responded that the mineral interests had been deemed “non-consent” due to Solis’s lack of participation, and it was authorized to recover risk penalties.The Board of Oil and Gas Conservation of the State of Montana held a hearing and determined that Kraken had made unsuccessful, good faith attempts to acquire voluntary pooling in the spacing unit, and that Phoenix, as a successor in interest, was bound to Solis’s decision not to participate. The Board therefore determined that the mineral interests owned by Phoenix would be subject to forced pooling and that Kraken could recover risk penalties from Phoenix. Phoenix requested a rehearing from the Board, but that request was denied. Phoenix then filed a Complaint seeking injunctive relief from the Board decision in the Thirteenth Judicial District Court, Yellowstone County. The District Court issued an Order granting Kraken and the Board’s motions for summary judgment, and dismissing Phoenix’s Complaint.In the Supreme Court of the State of Montana, Phoenix appealed the District Court's decision. The Supreme Court affirmed the lower court's decision, holding that the Board correctly interpreted the statutory force-pooling requirements, and that its decision to force pool Phoenix’s mineral interests was reasonable. The court also held that Kraken’s letters to Solis constituted written demands that gave Solis the option to either participate or face assessment of risk penalties. The court concluded that risk penalties were imposed, not pursuant to the presumption in § 82-11-202(3), MCA (2021), but under § 82-11-202(2), MCA, which requires an owner pay risk penalties when “after written demand, [the owner] has failed or refused to pay the owner’s share of the costs of development or other operations . . . .” View "Phoenix Capital v. Board of Oil & Gas" on Justia Law

The case involves a dispute over the Federal Energy Regulatory Commission's (FERC) certification of the Evangeline Pass Expansion Project, a series of expanded pipelines, compression facilities, and meter stations in the Southeastern United States. Environmental groups, including the Sierra Club and Healthy Gulf, challenged the certification, alleging that FERC improperly applied the National Environmental Policy Act (NEPA). Additionally, the Alabama Municipal Distributors Group, a municipal customer of Southern Natural Gas Company, argued that a new lease from Southern to Tennessee Gas may mean more profits for Southern, so Alabama Municipal should receive a portion of those profits.Prior to reaching the United States Court of Appeals for the District of Columbia Circuit, FERC had unanimously issued a Certificate Order to Tennessee Gas and Southern, denying all objections. FERC reaffirmed its determination on rehearing. The Sierra Club and Alabama Municipal timely petitioned for review.The Court of Appeals for the District of Columbia Circuit upheld FERC's certification of the Evangeline Pass Expansion Project. The court found that FERC's certification was reasonable and reasonably explained, as was its decision to deny a windfall to a pipeline owner's existing customers. The court rejected the Sierra Club's arguments that FERC failed to consider the full scope of environmental effects of the project, erred by failing to account for the environmental impact of two ongoing authorizations to export gas, and was required to use the "social cost of carbon" tool. The court also rejected Alabama Municipal's argument that it should receive a future credit on the existing rates it pays. The court concluded that all of FERC's decisions in this case were reasonable and reasonably explained, and therefore denied the petitions for review. View "Alabama Municipal Distributors Group v. FERC" on Justia Law