Justia Energy, Oil & Gas Law Opinion Summaries

Hess Bakken Investments II, LLC; Arkoma Drilling II, L.P.; and Comstock Oil & Gas, LP, (together the “Hess Group”) appealed an order and judgment dismissing their claims against AgriBank, FCB; Intervention Energy, LLC; and Riverbend Oil & Gas VI, L.L.C. (together, “Appellees”). At issue was the meaning of the term “actual drilling operations” as used in continuous drilling clauses in two oil and gas leases. The district court interpreted the term as requiring “placing the drill bit in the ground and penetrating the soil.” Each side has advanced competing readings of the term based on understandings of English grammar and industry usage. Although at odds, both interpretations are supported by rational arguments. The North Dakota Supreme Court concluded the term was ambiguous; "when ambiguity exists, the parties’ intent becomes a question of fact requiring a factual finding based on extrinsic evidence." Given this ambiguity, dismissal as a matter of law was improper. View "Hess Bakken Investments II, et al. v. AgriBank, et al." on Justia Law

The Fifth Circuit affirmed the district court's order confirming a $622 million arbitration award. The parties are oil and gas companies incorporated in different countries, and the dispute arose from the Agreement for the Provision of Drilling Services (DSA). About two years into the DSA's term, Vantage and Petrobras executed the Third Novation and Amendment Agreement, which included an arbitration clause.As a preliminary matter, the court stated that it need not decide the issue of whether the appeal waiver was enforceable. On the merits, the court held that there was no public policy bar to confirmation of the arbitration award. In this case, the district court did not engage in inappropriate deference to the arbitrator's decision and the district court did not base its decision just on "mutual mistake." The court also held that Petrobras has not shown that the district court abused its discretion in denying the discovery motions. Finally, the court rejected Petrobras' motion to vacate the arbitration award. View "Vantage Deepwater Co. v. Petrobras America, Inc." on Justia Law

The DC Circuit denied a petition for review of orders related to FERC's efforts to remove existing barriers to the participation of electric storage resources (ESRs) in the Regional Transmission Organization and Independent System Operator markets (RTO/ISO markets), independent, nonprofit companies that manage segments of the federal grid.The court held that petitioners failed to show that Order Nos. 841 and 841-A run afoul of the Federal Power Act's jurisdictional bifurcation or that they are otherwise arbitrary and capricious. After determining that petitioners have standing to bring their claims and that the matters are ripe for review, the court held that because the challenged orders do nothing more than regulate matters concerning federal transactions – and reiterate ordinary principles of federal preemption – they do not facially exceed FERC's jurisdiction under the Act. The court also held that FERC's decision to reject a state opt-out was adequately explained. View "National Association of Regulatory Utility Commissioners v. Federal Energy Regulatory Commission" on Justia Law

The Supreme Court affirmed an order of the State Corporation Commission denying Walmart's petitions filed pursuant to Va. Code 56-577(A)(4) seeking the Commission's permission to combine the electric-energy demand of separate Walmart locations to qualify to buy electricity from sources other than the incumbent public utilities regulated by the Commission, holding that the Commission exercised its delegated discretion in a manner consistent with its statutory authority.On appeal, Walmart conceded that the Commission was given the discretion under section 56-577(A)(4) to grant or deny Walmart's request but that the Commission acted arbitrarily and capriciously and erred as a matter of law in denying its petitions. The Supreme Court affirmed, holding (1) the Commission interpreted section 56-577(A)(4) correctly; (2) there was no error in the Commission's fact-finding; and (3) the Commission did not abuse its discretion in denying Walmart's motion to reconsider. View "Wal-Mart Stores East, LP v. State Corporation Commission" on Justia Law

The issue this case presented for the Tenth Circuit's review centered on whether federal court was the proper forum for a suit filed in Colorado state court by local governmental entities for the global warming-related damage allegedly caused by oil and gas companies in Colorado. Suncor Energy and ExxonMobil advanced seven bases for federal subject matter jurisdiction in removing the action to federal court, each of which the district court rejected in its remand order. Suncor Energy and ExxonMobil appealed, reiterating six of those bases for federal jurisdiction. After review, the Tenth Circuit held that 28 U.S.C. 1447(d) limited its appellate jurisdiction to just one of them: federal officer removal under 28 U.S.C. 1442(a)(1). And because the Court concluded ExxonMobil failed to establish grounds for federal officer removal, the Court affirmed the district court’s order on that basis and dismissed the remainder of this appeal. View "Boulder County Commissioners v. Suncor Energy" on Justia Law

Digidrill filed suit against its competitor, Petrolink, alleging that Petrolink hacked into its software at various oil drilling sites in order to "scrape" valuable drilling data in real time. The district court granted Petrolink's motion for summary judgment on Digidrill's copyright claims. Digidrill's unjust enrichment claim proceeded to trial, where a jury returned a verdict in Digidrill's favor.In regard to the copyright infringement claim, the Fifth Circuit affirmed the district court's judgment and held that Digidrill likely waived its "qualitative importance" argument but, even if not, the argument fails on the merits because no reasonable jury could find substantial similarity based on the qualitative importance of the copied schema to DataLogger as a whole. The court also affirmed the district court's judgment as to the Digital Millennium Copyright Act claims, holding that the USB dongle and Interface Process did not effectively control access to the protected database schema.The court also held that Digidrill's unjust enrichment claim is not preempted by the Copyright Act because the claim incorporates an element beyond mere unauthorized copying. The court held that the available Texas authorities do not foreclose the possibility that a litigant may show the taking of an undue advantage without showing the violation of a law or legal duty. Therefore, the court affirmed the district court's denial of Petrolink's judgment as a matter of law on the issue of whether Digidrill adduced sufficient evidence of the benefit Petrolink obtained from Digidrill. Finally, the court held that the district court failed to treat Petrolink as the prevailing party under the relevant statutes and failed to apply the correct legal standard. Accordingly, the court vacated the district court's denial of Petrolink's motion for fees and remanded. View "Digital Drilling Data Systems, LLC v. Petrolink Services, Inc." on Justia Law

The DC Circuit denied the Commission's and Intervenor's motions to dismiss the petitions filed after thirty days of Commission inaction. The court explained that, before a party aggrieved by an order of the Federal Energy Regulatory Commission can obtain judicial review, that party must file an application for rehearing with the Commission. Congress directed that, if the Commission fails to act on that rehearing application within thirty days, the application may be deemed denied, allowing the aggrieved party to proceed to federal court. The court held that under the plain statutory language and context of the Natural Gas Act, such tolling orders are not the kind of action on a rehearing application that can fend off a deemed denial and the opportunity for judicial review.In this case, because the Commission's Tolling Order could not prevent the Homeowners and Environmental Associations from seeking judicial review, the initial petitions for review that they filed challenging the Certificate Order in Nos. 17-1098 and 17-1128 are properly before this court for review, and the motions to dismiss those petitions for lack of jurisdiction are denied. The court held that the Homeowners' and Environmental Associations' challenge to the Certificate Order falls short because the Commission did not rely on precedent agreements alone to find that the pipeline would be a matter of public convenience and necessity. Therefore, the court denied all four petitions for review, as well as the Commission's and Transco's motions to dismiss the petitions for review in Nos. 17-1098 and 17-1128. View "Allegheny Defense Project v. Federal Energy Regulatory Commission" on Justia Law

National Parks Conservation Association (“NPCA”) appealed a judgment affirming a final permit decision by the North Dakota Department of Environmental Quality, formerly the Department of Health Environmental Health Section, to issue Meridian Energy Group, Inc. an air quality permit to construct a refinery. In October 2016, Meridian submitted its initial application and supporting documentation to the Department for a permit to construct the Davis Refinery, as required under North Dakota’s air pollution control rules implementing the federal Clean Air Act. The Department received over 10,000 comments, with most of the substantive comments coming from NPCA, the National Park Service, and the Environmental Protection Agency. NPCA filed comments with the Department supported by its two experts’ opinions, asserting that Meridian’s oil refinery would be a “major source,” rather than a “minor source,” of air pollution and that the permit does not contain “practically enforceable” emissions limits under the federal Clean Air Act and North Dakota’s air pollution control rules implementing the Clean Air Act. After considering public comments and Meridian’s responses, the Department’s Air Quality Division recommended to the State Health Officer that the Department issue a final permit because the Davis Refinery’s emissions are expected to comply with the applicable North Dakota air pollution control rules. The North Dakota Supreme Court concluded the Department did not act arbitrarily, capriciously, or unreasonably in issuing the permit. View "Nat'l Parks Conservation Assn., et al. v. ND Dept. of Env. Quality, et al." on Justia Law

Mark Hiepler, as the trustee of the Orville G. Hiepler and Florence L. Hiepler Family Trust (“Trust”), appealed a judgment ordering him to transfer certain Trust property to Bill Seerup, and appealed an order denying his motion to dismiss. In April 2007, Orville and Florence Hiepler deeded 150 net mineral acres in Williams County to Seerup in exchange for $15,609. The mineral deed did not refer to the Trust or Orville and Florence Hiepler’s role as co-trustees. When the deed was executed, Orville individually owned only 7.3636 mineral acres. The remaining 142.6 mineral acres were owned by the Trust. Nine days after receiving the mineral deed from Orville and Florence Hiepler, Seerup conveyed 135 mineral acres to Hurley Oil Properties, Inc. In 2014, Dale Exploration, LLC, filed suit to quiet title to the 150 net mineral acres conveyed in the mineral deed from Orville and Florence Hiepler to Seerup. Seerup and Hurley Oil also brought a claim for breach of contract against Orville and Florence Hiepler, individually and as co-trustees, requesting specific performance or, alternatively, money damages if specific performance was not ordered. In 2017, the district court dismissed Dale Exploration’s claims on summary judgment, finding there was no evidence that Dale Exploration had an interest in the property. A bench trial was held on the remaining issues. The court found the Hieplers own the mineral interests in fee simple as trustees, not as individuals. The court also found the Hieplers breached the mineral deed to Seerup and the proper remedy was damages, not specific performance. The court awarded damages in the amount of $20,147.96. The North Dakota Supreme Court reversed that judgment and remanded for further proceedings on whether money damages were adequate in light of specific performance. Orville died after the Supreme Court's judgment and mandate were issued. Orville and Mark responded to a proposed order drafted by Seerup and Hurley Oil, arguing the pleasings did not adequately assert specific performance. Specific performance of the mineral deed was ultimately granted. Mark Hiepler argues the district court erred in ordering him to convey the property to Seerup because the court did not have jurisdiction to enter a judgment against the Trust, the claims abated upon Orville Hiepler’s death, and he could not be substituted as a party for Orville Hiepler. Finding no error in the district court's judgment, the North Dakota Supreme Court affirmed. View "Dale Exploration, et al. v. Hiepler, et al." on Justia Law

The Court of Appeals held that the certificate of public convenience and necessity issued by the Federal Energy Regulatory Commission (FERC) to National Fuel Gas Supply for its proposed construction of a ninety-nine-mile natural gas pipeline satisfied Eminent Domain Procedure Law (EDPL) 206(A) so as to entitle National Fuel to exercise eminent domain over the land in dispute without undertaking additional review of the pipeline's public benefit.National Fuel commenced this EDPL vesting proceeding seeking to acquire, by eminent domain, temporary construction easements and a fifty-foot-wide permanent easement over property owned by Landowners to facilitate construction of the pipeline. Supreme Court granted the EDPL petition, concluding that National Fuel made a prima facie showing of entitlement to the easements based on the FERC certification. The Appellate Division reversed, reasoning that the New York State Department of Environmental Conservation's intervening denial of National Fuel's application for a water quality certification meant that National Fuel no longer held a qualifying federal certificate for purposes of the EDPL 206(A) exemption. The Court of Appeals reversed, holding that because the FERC-issued certificate of public convenience and necessity did not condition National Fuel's eminent domain power on receipt of a water qualify certification, the federal certificate remained valid at all relevant times. View "National Fuel Gas Supply Corp. v. Schueckler" on Justia Law