Justia Energy, Oil & Gas Law Opinion Summaries

The Supreme Court affirmed the judgment of the district court affirming the decision of the Board of County Commissioners of Albany County approving ConnectGen Albany County LLC's application for a Wind Energy Conversion System (WECS) permit to construct a wind farm on Albany County land, holding that Appellants were not entitled to relief.Specifically, the Supreme Court held (1) contrary to Appellants' argument on appeal, ConnectGen was not required to obtain a conditional use permit in addition to the WECS special use permit; (2) the Board's approval of the WECS special use permit was not arbitrary or capricious; and (3) Appellants failed to establish that the Board's approval of the WECS special use permit was a taking of private property in violation of Wyo. Const. art. 1, 32. View "Aanonsen v. Bd. of County Commissioners of Albany County" on Justia Law

The Supreme Court affirmed the judgment of the court of appeals reversing the orders of the trial court granting TotalEnergies E&P USA, Inc.'s motion to stay an American Arbitration Association (AAA) arbitration and denying MP Gulf of Mexico, LLC's motion to compel that arbitration, holding that the parties clearly and unmistakably delegated to the AAA arbitrator the decision of whether the parties' controversy must be resolved by arbitration.In this dispute arising over interests in a group of oil-and-gas leases Total E&P sought a declaration construing the parties' "Cost Sharing Agreement." On the same day, Total E&P initiated an arbitration proceeding asking the International Institute to determine the parties' rights under their "Chinook Operating Agreement." MP Gulf subsequently initiated the AAA arbitration proceeding. Total E&P filed a motion to stay the arbitration, which the trial court granted. The court of appeals reversed and compelled AAA arbitration. The Supreme Court affirmed, holding that the parties agreed to delegate the arbitrability issue to the arbitrator. View "TotalEnergies E&P USA, Inc. v. MP Gulf of Mexico, LLC" on Justia Law

Alaska Venture Capital Group, LLC (AVCG) owned interests in oil and gas leases on state lands. AVCG sought the State’s approval to create overriding royalty interests on the leases. The Alaska Department of Natural Resources, Division of Oil and Gas denied AVCG’s requests, explaining that the proposed royalty burdens jeopardized the State’s interest in sustained oil and gas development. AVCG appealed. Five years later the DNR Commissioner affirmed. The superior court then affirmed the Commissioner’s decisions. AVCG appealed to the Alaska Supreme Court, arguing primarily that the decisions improperly adopted a new regulation that did not undergo the rulemaking procedures of Alaska’s Administrative Procedure Act (APA). AVCG maintained that DNR’s reliance on specific factors - in particular, the fact that the proposed ORRIs would create a total royalty burden of over 20% on the leases - amounted to adopting a regulation. AVCG also argued that the decisions lacked a reasonable basis in fact and law and that, for some of its leases, no agency approval was required at all. The Supreme Court rejected these arguments, and rejected AVCG's constitutional claim: that delay and an "ad hoc" decision-making process violated its procedural due process rights. View "AVCG, LLC v. Alaska Department of Natural Resources" on Justia Law

The Supreme Court reversed the judgment of the district court dismissing the complaint brought by Lustre Oil Company LLC and Erehwon Oil & Gas, LLC (collectively, Lustre Oil) for lack of subject matter jurisdiction, holding that the district court did not properly weigh the relevant jurisdictional factors.Lustre Oil filed an action against A&S Mineral Development Company, LLC seeking to quiet title and to invalidate A&S's interests in forty-one of the fifty-seven oil and gases leases operated by A&S within the Fort Beck Indian Reservation, home to the Assiniboine and Sioux Tribes. The district court dismissed the action for lack of jurisdiction, concluding that A&S was an arm of the Tribes entitling it to immunity. The Supreme Court reversed, holding (1) the district court did not err in concluding that A&S's incorporation under Delaware law did not favor immunity and in thus refusing to deny A&S tribal sovereign immunity based on state incorporation alone; and (2) consideration of the White factors weighed against the extension of sovereign immunity to A&S as an arm of the Tribes for the purpose of Lustre Oil's claims in this case. View "Lustre Oil Co. v. Anadarko Minerals, Inc." on Justia Law

The Renewable Fuel Standard (RFS) program requires gasoline and diesel fuel refiners, blenders, and importers to ensure that a certain portion of their annual transportation fuel production consists of renewable fuels, 42 U.S.C. 7545(o)). United, a small Pennsylvania refinery, has periodically received hardship exemptions from those requirements, including in the 2017 and 2018 compliance years. In 2019, United sought an exemption. Rather than accepting United's data at face value—as in previous years—EPA asked how United had accounted for the financial benefit of its 2018 RFS exemption. United's amended financial statement explained that revenue from selling its renewable fuel credits (RINS) generated in a particular year was included in net revenues for that year, even if the RINs actually were sold in a later calendar year. United’s amended figures showed a three-year refining margin that was higher than the margin in United’s original submission and higher than the industry average. The Department of Energy (DOE) evaluated United’s submission and initially recommended that United not receive an exemption. DOE later changed its recommendation to account for the effects of COVID-19 and suggested a 50 percent exemption for 2019.EPA denied United any exemption, declining to consider events “that did not emerge until 2020, the year after the petition in question.” The Third Circuit denied a petition for review, rejecting United’s argument that EPA arbitrarily relied on an “accounting trick” that artificially inflated United’s running average net refining margin. View "United Refining Co v. Environmental Protection Agency" on Justia Law

In 2018, ONEOK Arbuckle II Pipeline, LLC began construction of a natural gas liquid pipeline to transport Oklahoma production to the interstate market. The pipeline required electricity to operate a series of pump stations, including the Binger II Pump Station. The location for the proposed Binger II was in the certified territory of CKenergy Electric Cooperative, Inc., which has exclusive rights to provide electricity in the area pursuant to the Retail Electric Supplier Certified Territory Act. Relying on the large-load exception to the RESCTA, OG&E submitted a bid to provide service to the Binger II, which ONEOK accepted, and the parties contracted for service. CKenergy appealed this contract to the Oklahoma Corporation Commission asserting that it was a violation of its exclusive rights under the RESCTA. The Commission enjoined OG&E's service, concluding that the meaning of "extending its service" in section 158.25(E) limited the manner or mechanism which OG&E could use to provide service under the large-load exception. OG&E and ONEOK appealed, the Oklahoma Supreme Court retained both appeals, and consolidated the cases. The Supreme Court held that section 158.25(E) allowed OG&E to extend its service to large loads in the manner proposed. Therefore, the Commission's order enjoining OG&E was vacated and remanded for further proceedings. View "Okla. Gas & Electric Co. v. State ex rel. Okla. Corp. Comm'n" on Justia Law

This matter arose out of disputes between Antero Resources Corporation (“Antero”) and Airport Land Partners, Ltd (“Airport Land”) and other royalty owners (collectively, “Royalty Owners”) over whether Antero could deduct certain post-production costs from royalty payments under the applicable leases’ royalty clauses. Royalty Owners alleged that Antero has underpaid royalties in violation of their respective lease contracts. Royalty Owners filed individual breach-of-contract suits against Antero for dates between December 2016 and April 2017. Antero moved to dismiss the suits, arguing that the claims should have been brought before the Colorado Oil and Gas Conservation Commission (“COGCC” or “the Commission”) in the first instance. Statutorily, COGCC lacked jurisdiction under section 34-60-118.5(5), C.R.S. (2022), to engage in contract interpretation to resolve a bona fide dispute between parties under an oil and gas lease. But in 2017, without any intervening change to explain the shift, two district courts changed course, asserting that COGCC had responsibility for resolving contract disputes on the theory either that the contract terms were unambiguous or that settled law compelled a certain interpretation. The Colorado Supreme Court returned to the longstanding statutory mandate that COGCC lacked jurisdiction to resolve bona fide disputes of contract interpretation and held that such a dispute exists where the parties disagree in good faith about the meaning or application of a relevant contract term. View "Antero Resources v. Airport Land Partners" on Justia Law

Minnesota sued a litany of fossil fuel producers1 (together, the Energy Companies) in state court for common law fraud and violations of Minnesota’s consumer protection statutes. In doing so, it joined the growing list of states and municipalities trying to hold fossil fuel producers responsible for alleged misrepresentations about the effects fossil fuels have had on the environment. The Energy Companies removed to federal court. The district court granted Minnesota’s motion to remand, and the Energy Companies appealed.   The Eighth Circuit affirmed. The court held that Congress has not acted to displace the state-law claims, and federal common law does not supply a substitute cause of action, the state-law claims are not completely preempted. The court reasoned that because the “necessarily raised” element is not satisfied, the Grable exception to the well-pleaded complaint rule does not apply to Minnesota’s claims. Further, the court wrote that the connection between the Energy Companies’ marketing activities and their OCS operations is even more attenuated. Thus, neither requirement is met, there is no federal jurisdiction under Section 1349. View "State of Minnesota v. American Petroleum Institute" on Justia Law

Petitioners sought the Oregon Supreme Court's review of an order of the Energy Facility Siting Council (EFSC) that approved an Idaho Power Company (Idaho Power) application for a site certificate to construct a high-voltage electrical transmission line from Boardman, Oregon, to Hemingway, Idaho. Petitioner STOP B2H Coalition (Stop B2H) contended that EFSC erred by : (1) denying Stop B2H’s request for full party status in the contested case proceedings; (2) granting an exception or variance to noise level requirements; (3) modifying the governing rule to limit the noise assessment to landowners within one-half mile of the transmission line; and (4) misapplying EFSC’s rules on the visual impacts from the transmission line. Petitioner Michael McAllister contended EFSC erred by failing to require Idaho Power to include in its application an “environmentally preferable” location for a segment of the transmission line in Union County. Petitioner Irene Gilbert contended EFSC erred by: (1) denying Gilbert’s request for full party status; (2) failing to document the impacts on historic properties and mitigation measures; (3) delegating future approval of mitigation plans to the Oregon Department of Energy (ODOE); (4) relying on federal standards to determine mitigation requirements for historic properties; and (5) modifying a mandatory site certificate condition without rulemaking. Applying the governing standard of review, the Supreme Court affirmed EFSC’s final order approving the site certificate for this transmission line. View "Stop B2H Coalition v. Dept. of Energy" on Justia Law

The Supreme Court affirmed the decision of the Public Utilities Commission (PUC) rejecting the power purchase agreement between Hu Honua and the Hawai'i Electric light Company, Inc., holding that there was no error in the PUC's decision to reject the power purchase agreement between the parties.At issue was the denial of Hua Honua's request for regulatory approval to supply energy to Hawai'i Island using a biomass power plant. In declining to approve the project on remand, the PUC found that the project would produce massive greenhouse gas (GHG) emissions and significantly increase costs for rate-payers. The Supreme Court affirmed, holding that the PUC understood its public interest-minded mission and properly followed this Court's remand instructions to consider the reasonableness of the proposed project's costs in light of its GHG emissions and the impact on Intervenors' right to a clean and healthful environment. View "In re Haw. Electric Light Co., Inc." on Justia Law