Justia Energy, Oil & Gas Law Opinion Summaries

The Outer Continental Shelf (OCS) extends roughly 200 miles into the ocean to the limit of U.S. international-law jurisdiction. Billions of barrels of oil and trillions of cubic feet of natural gas lie beneath the OCS. Concerns about ecological vulnerability and potential harm to coastal tourism led to moratoriums on OCS drilling from 1982 until they were partially lifted in 2009. In 2010, the Deepwater Horizon oil rig disaster renewed debate about the safety of offshore drilling, but energy companies remain interested in offshore drilling. The Outer Continental Shelf Lands Act (OCSLA) created a framework for exploration and extraction of OCS oil and gas deposits. It requires the Secretary of the Interior to prepare a program every five years with a schedule of proposed leases for OCS resource exploration and development; the program must balance competing economic, social, and environmental values, 43 U.S.C. 1344. CSE challenged the latest leasing program as failing to comply with Section 18(a), which governs the balancing of competing economic, social, and environmental values; quantifying and assessing environmental and ecological impact; and ensuring equitable distribution of benefits and costs between OCS regions and stakeholders. CSE claimed that the Final Programmatic Environmental Impact Statement violated National Environmental Policy Act procedural requirements by using a biased analytic methodology and providing inadequate opportunities for public comment. The D.C. Circuit denied CSE’s petition. While CSE had associational standing to petition for review, its NEPA claims are unripe; two other challenges were forfeited and remaining challenges failed on their merits. View "Ctr. for Sustainable Econ. v. Jewell" on Justia Law

In 1979, plaintiff Morristown Associates purchased commercial property located in Morristown. The property contained a strip-mall-style shopping center known as Morristown Plaza. Among the tenants was Plaza Cleaners, a dry cleaning business owned at the time by Robert Herring. Herring and his wife had entered into a lease with the property's previous owner, Morris Center Associates, in 1976. Due to construction, Herring was unable to occupy and operate Plaza Cleaners until 1978. At some point before moving in, Herring installed a steam boiler in a room at the rear of the leased space and an underground storage tank (UST) for fuel to operate the boiler. In 1985, Herring sold Plaza Cleaners to defendants Edward and Amy Hsi. The Hsis owned the business until 1998 when it was sold to current owner and third-party defendant, Byung Lee. In August 2003, a monitoring of a well installed near Plaza Cleaner's UST revealed fuel oil contamination. A subsequent investigation revealed that although the UST was intact, the fill and vent pipes were severely deteriorated, with large holes along a significant portion of their lengths. Plaintiff's experts concluded that those holes had developed as early as 1988 and, since that time, oil had been leaking from the pipes each time the tank was filled. Each of the named oil company defendants in this case allegedly supplied fuel oil to Plaza Cleaners at various times between 1988 and 2003. The issue in this appeal was whether the general six-year statute of limitations contained in N.J.S.A. 2A:14-1 applied to private claims for contribution made pursuant to the New Jersey Spill Compensation and Control Act, N.J.S.A. 58:10-23.11f(a)(2)(a). Based on the plain language of the Spill Act, reinforced by its legislative history, the New Jersey Supreme Court held that N.J.S.A. 2A:14-1 s six-year statute of limitations was not applicable to Spill Act contribution claims. The Court therefore rejected the contrary determination of the Appellate Division and reversed and remanded this case to the Appellate Division for its consideration of other issues raised on appeal that were unaddressed. View "Morristown Associates v. Grant Oil Co." on Justia Law

Passadumkeag Windpark, LLC (PW) sought approval to construct a wind farm on property owned by Penobscot Forest, LLC (PF) located in Grand Falls Township. The Department of Environmental Protection denied the requested permit. On review, the Board of Environmental Protection (Board) granted the permit. Passadumkeag Mountain Friends (PMF), a Maine nonprofit corporation, and Alexander and Rhonda Cuprak appealed. The Supreme Court affirmed the decision of the Board, holding (1) the decision of the Board was operative for purposes of appellate review; (2) the Board’s findings and conclusion were supported by substantial evidence in the record; and (3) certain communications between the Board, PW, and PF during the application process did not affect the Cupraks’ due process rights. View "Passadumkeag Mountain Friends v. Bd. of Envtl. Prot." on Justia Law

Applicant Ecos Energy, LLC appealed the Public Service Board's decision that its proposed solar power project did not qualify for a standard-offer power purchase contract under Vermont's Sustainably Priced Energy Enterprise Development (SPEED) program because it exceeded the statutory limit on generation capacity. In 2009, the Board issued an order in which it prescribed various procedures and requirements for the standard-offer program. The standard-offer program was administered by the SPEED facilitator, VEPP, Inc. One of the participants in the implementation process, Central Vermont Public Service, commented that separate projects would need to enter into separate interconnection agreements with the utility, enter into separate standard contracts, and obtain separate certificates of public good. Another participant, Renewable Energy Vermont, commented that the statute was clear that "separate plants that share common infrastructure and interconnection should be considered as one plant." In April 2013, VEPP issued a request for proposals (RFP) for projects. Applicant proposed three 2.0 MW solar projects (the Bennington Solar project, the Apple Hill Solar project, and the Sudbury Solar project). Applicant's three projects were the lowest-priced projects. In submitting the RFP results to the Board, VEPP noted that the Bennington project and the Apple Hill project would be located on the same parcel of property and the generation components of the project were "physically contiguous." It requested that the Board make a determination as to whether or not the two projects constituted a single plant. The Board accepted the Bennington project and disqualified the Apple Hill project, which had a higher price. The Board authorized VEPP to enter into standard-offer contracts with applicant for the Bennington and Sudbury projects. Applicant subsequently petitioned the Board to reconsider and modify its order. When it refused, applicant appealed the decision. Upon review of the matter, the Supreme Court found that the Board's conclusion that the Bennington and Apple Hill projects constituted a single plant was contrary to the plain language of the applicable statute: the Bennington and Apple Hill projects would qualify as "independent technical facilities." As such the Court reversed the Board's decision and remanded the case for further proceedings.View "In re Programmatic Changes to the Standard-Offer Program and Investigation into the Establishment of Standard-Offer Prices under the Sustainably Priced Energy Enterprise Development" on Justia Law

BNE Energy, Inc. submitted two petitions for declaratory rulings seeking the Connecticut Siting Council’s approval for the construction and operation of three electric generating wind turbines on two separate properties in the town of Colebrook. Plaintiffs intervened in the proceedings. The Council approved the petitions with conditions, and Plaintiffs appealed. The trial court dismissed Plaintiffs’ appeals. The Supreme Court affirmed, holding that the trial court did not err in concluding that the Council (1) had jurisdiction over BNE’s petitions; (2) was authorized to attach conditions to its approval of the petitions; (3) was authorized to approve the petitions even though it had not determined that the proposed projects comply with state noise law; (4) properly approved of shorter hub heights for one of the projects; and (5) did not deprive Plaintiffs of their right to fundamental fairness during the hearings on the petitions. View "FairwindCT, Inc. v. Conn. Siting Council" on Justia Law

NYSEG filed suit against FirstEnergy under section 107(a) of the Comprehensive Environmental Response, Compensation, and Liability Act of 1980 (CERCLA), 42 U.S.C. 9601 et seq., to recover certain costs incurred in remediating coal tar contamination at certain of NYSEG's manufactured gas plants in upstate New York. NYSEG contends that FirstEnergy is liable as the successor to NYSEG's former parent company, AGECO, for a portion of the cleanup costs. FirstEnergy filed counterclaims against NYSEG and third-party claims against I.D. Booth, the current owner of one of the sites, for cost contribution under section 113(f). The district court held that NYSEG was entitled to recover certain cleanup costs from FirstEnergy based on a veil piercing theory, but limiting that recovery to certain sites. The district court also found I.D. Booth liable for a portion of the cleanup costs at one site. The court held that NYSEG's CERCLA claims against FirstEnergy are not barred by the covenant not to sue; AGECO is not directly liable under CERCLA as an operator; FirstEnergy is liable to NYSEG on a veil piercing theory based on AGECO's control of NYSEG from 1922 to January 10, 1940, but not for contamination created by other AGECO subsidiaries before those subsidiaries merged into NYSEG; NYSEG's claims as to the (a) Plattsburgh site are timely, (b) Norwich site are untimely, and (c) Oswego site are untimely; the district court did not err in calculating total gas production at the sites; the district court did not abuse its discretion in reducing NYSEG's recovery from FirstEnergy by a portion of NYSEG's $20 million insurance settlement; the district court did not abuse its discretion in declining to reduce NYSEG's recovery to reflect the increased value of the remediated properties or NYSEG's alleged delay in the remedial efforts; and I.D. Booth is liable for a portion of cleanup costs and the district court did not abuse its discretion in apportioning liability in this respect. Accordingly, the court affirmed in part, vacated in part, and remanded for further proceedings. View "New York State Elec. & Gas v. FirstEnergy Corp." on Justia Law

The companies obtained an oil and gas lease from the government for a 5760-acre tract on the Outer Continental Shelf. They made an initial bonus payment of $23,236,314 and have paid additional rental payments of $54,720 per year. The lease became effective on August 1, 2008, and had an initial term running through July 31, 2016. It provided that it issued pursuant to and was subject to the Outer Continental Shelf Lands Act of August 7, 1953, (OCSLA) 43 U.S.C. 1331 and “all regulations issued pursuant to the statute in the future which provide for the prevention of waste and conservation of the natural resources of the Outer Continental Shelf and the protection of correlative rights therein; and all other applicable statutes and regulations.” In 2010, an explosion and fire on the Deepwater Horizon semi-submersible oil drilling rig in the Gulf of Mexico killed 11 workers and caused an oil spill that lasted several months. As a result, the government imposed new regulatory requirements, Oil Pollution Act (OPA), 33 U.S.C. 2701. The companies sued for breach of contract. The Claims Court and Federal Circuit ruled in favor of the government, finding that the government made the changes pursuant to OCSLA, not OPA. View "Century Exploration New Orleans, LLC v. United States" on Justia Law

The Surface Mining Control and Reclamation Act, 30 U.S.C. 1202(a) allows states to enact and administer regulatory programs consistent with federal standards, subject to federal approval. Kentucky’s Department for Natural Resources assumed responsibility for SMCRA implementation through its Division of Mine Permits, Ky. Rev. Stat. 350.028, .465(2). Its program has been approved by the U.S. Department of the Interior since 1982. A typical surface mining operation also requires permits under the Clean Water Act, 33 U.S.C. 1251: a 401 permit for “discharge into the navigable waters;” a 402 permit for “discharge of any pollutant, or combination of pollutants;” and a 404 permit for “discharge of dredged or fill material into the navigable waters at specified disposal sites.” A 404 permit is issued by the U.S. Army Corps of Engineers in compliance with EPA guidelines, 33 U.S.C. 1344(b)(1). Kentucky authorized a Perry County surface mining operation; the operator obtained 404 permit from the Corps, authorizing it to “mine through” and fill surface stream beds, which are already in a degraded state, requiring offset of the limited environmental effect by improving other streams in the watershed. Opponents argued that the National Environmental Policy Act required the Corps to consider the public health impacts related to surface mining in general, and that the Corps violated the CWA by using flawed analysis of the mitigation plan. The district court rejected the arguments. The Sixth Circuit affirmed.View "Kentuckians for the Commonwealth v. U.S. Army Corps of Eng'rs" on Justia Law

Petitioners challenged the Commission's approval of a proposal for the construction of a natural gas compressor station in the Town of Minisink, New York. Petitioners argued, among other things, that the Commission's approval of the project was arbitrary and capricious, particularly given the existence of a nearby alternative site (the Wagoner Alternative) they insist is better than the Minisink locale. The court concluded that the Commission's consideration of the Wagoner Alternative falls within the bounds of its discretion and the court had no basis to upset the Commission's application of its Section 7 of the Natural Gas Act, 15 U.S.C. 717-717z, authority on this point; the court was satisfied that the Commission properly considered cumulative impacts of the Minisink Project; the court reject petitioners' argument that the Minisink Project violates the siting guidelines; and the court rejected petitioners' claims of procedural errors. Accordingly, the court denied the petitions for review. View "Minisink Residents for Enviro., et al. v. FERC" on Justia Law

Denali Citizens Council challenged the Department of Natural Resources' (DNR) finding that issuing a license to Usibelli Coal Mine for gas exploration in the Healy Basin was in the best interests of the state on two grounds: (1) DNR failed to take a "hard look" at the economic feasibility of excluding certain residential areas and wildlife habitat from the license; and (2) DNR's treatment of environmental mitigation measures in the best interest finding was arbitrary and capricious. Upon review, the Supreme Court affirmed the superior court's order upholding DNR's decision to issue the gas exploration license to Usibelli because the Court concluded that DNR did not act arbitrarily in developing and publishing its best interest finding. View "Denali Citizens Council v. Alaska Dept. of Natural Resources" on Justia Law