Justia Energy, Oil & Gas Law Opinion Summaries

SWN Production Company, LLC sought to drill multiple horizontal natural gas wells on a 301-acre tract within the City of Weirton, West Virginia. The City required a conditional use permit for oil and gas extraction under its zoning ordinance. SWN applied for such a permit, and the City’s Board of Zoning Appeals (BZA) held hearings where community members raised concerns about traffic, noise, and the effect on local development. The BZA denied SWN’s application, citing incompatibility with the City’s comprehensive development plan and other adverse impacts. Afterward, SWN obtained a drilling permit from the West Virginia Department of Environmental Protection (DEP).SWN filed two actions in the Circuit Court of Brooke County: a petition for a writ of certiorari challenging the BZA’s decision and a complaint seeking a declaration that the City’s zoning ordinance was preempted by state law, especially the Natural Gas Horizontal Well Control Act. The circuit court rejected SWN’s preemption argument and affirmed the BZA’s denial of the permit. SWN appealed both rulings to the Intermediate Court of Appeals of West Virginia (ICA). The ICA reversed the circuit court on the preemption issue, finding the City’s ordinance conflicted with state law, but dismissed SWN’s appeal of the certiorari ruling for lack of jurisdiction.The Supreme Court of Appeals of West Virginia reviewed both appeals. It held that there was no irreconcilable conflict between the City’s zoning ordinance and the state’s environmental statutes; rather, any overlap was incidental and not preempted. The Court reversed the ICA’s decision on preemption and reinstated the circuit court’s order dismissing SWN’s facial preemption challenge. Regarding the certiorari appeal, the Court affirmed the ICA’s dismissal, holding that the ICA lacked subject-matter jurisdiction to review extraordinary remedies such as certiorari. View "City of Weirton v. SWN Production Company, LLC" on Justia Law

Oak Run Solar Project, L.L.C. sought approval from the Ohio Power Siting Board to construct a solar-powered electric generation facility in Madison County, Ohio. The proposed facility would occupy approximately 4,400 acres and include an 800 MW solar array, a 300 MW battery energy storage system, and two transmission lines. Oak Run entered agreements with landowners for the project site and committed to an agrivoltaics program, maintaining agricultural productivity alongside solar generation. Local governments and other parties intervened, raising concerns about environmental, visual, water, plant, wildlife, and safety impacts. The board’s staff issued a report, and a hearing was held, resulting in project approval subject to conditions for landscape screening and safety.Prior to reaching the Supreme Court of Ohio, the Ohio Power Siting Board considered Oak Run’s application and allowed intervenors, including several township boards and the county board of commissioners, to participate. After a hearing and review, the board granted Oak Run’s certificate for construction, finding the statutory requirements satisfied and imposing conditions related to visual screening and emergency response. The local governments filed an application for rehearing, which was denied. They then appealed to the Supreme Court of Ohio, arguing the board failed to obtain necessary information, especially regarding visual impacts and environmental effects.The Supreme Court of Ohio reviewed the case, applying a standard of review for “unlawful or unreasonable” board orders. The court held that Oak Run failed to provide required photographic simulations or sketches of substations, as mandated by administrative rules, thereby depriving the board of necessary information to assess visual impacts. The court affirmed the board’s orders in part, reversed in part regarding the visual-impact information, and remanded the matter to the board for further consideration of the project’s visual effects. View "In re Application of Oak Run Solar Project, L.L.C." on Justia Law

Maryland enacted legislation regulating how retail electricity suppliers may market “green power” to consumers, seeking to address concerns that consumers were misled by claims about renewable energy. The statute prohibits suppliers from using terms such as “clean,” “green,” or “100% renewable” unless at least 51% of the energy is backed by renewable energy credits (RECs) from within a specific regional grid (the PJM region). Additionally, suppliers are required to include disclosures explaining the nature of RECs and their relationship to renewable electricity, with the exact disclosure language later specified by the Maryland Public Service Commission (PSC).Retail Energy Advancement League and Green Mountain Energy Company brought a facial First Amendment challenge against these provisions and sought a preliminary injunction in the United States District Court for the District of Maryland. The district court denied the injunction, applying intermediate scrutiny to the speech restriction and concluding that the plaintiffs were unlikely to prevail on the merits. The court also found that the statute’s disclosure requirements likely survived constitutional review.On appeal, the United States Court of Appeals for the Fourth Circuit found that the plaintiffs demonstrated a likelihood of success in showing the speech restriction was unconstitutional even under intermediate scrutiny, because the restriction did not materially advance Maryland’s asserted interest in preventing consumer deception and was not adequately tailored. The Fourth Circuit reversed the district court’s denial of a preliminary injunction as to the speech restriction and ordered an injunction against enforcement of that provision. However, regarding the compelled disclosure requirement, the Fourth Circuit remanded the case for the district court to review the constitutionality of the new PSC-promulgated disclosure language in the first instance. View "Retail Energy Advancement League v. Brown" on Justia Law

A private company specializing in the disposal of wastewater from oil and gas fracking leased land in an urban area and constructed two saltwater-injection wells. After two earthquakes were recorded near the wells, the State of Ohio determined the company’s activities caused the seismic events and temporarily suspended operations at both wells. One well was later permitted to resume limited operations, but the suspension of the second well remained until 2021. The company had been aware of seismicity risks before acquiring its leasehold and warned investors of possible regulatory shutdowns.After the suspension, the company pursued administrative and judicial challenges, including an appeal to the Ohio Oil and Gas Commission and the Tenth District Court of Appeals, both of which upheld the State’s actions. The company then filed a petition for a writ of mandamus in the Eleventh District Court of Appeals, claiming a regulatory taking of its property. The Eleventh District initially denied relief, but following multiple remands from the Supreme Court of Ohio, it ultimately found no total taking but did find a compensable partial regulatory taking under the Penn Central analysis, ordering the State to initiate eminent-domain proceedings.On appeal, the Supreme Court of Ohio reviewed whether the suspension order constituted a total or partial regulatory taking. The court held that the company failed to prove it was deprived of all economically beneficial use, rejecting the total taking claim. The court further held that, under a proper balancing of the Penn Central factors, the State’s actions did not amount to a compensable partial taking. The Supreme Court of Ohio affirmed the Eleventh District’s denial of the total takings claim, reversed its partial takings finding, and denied the writ of mandamus. View "State ex rel. AWMS Water Solutions, L.L.C. v. Mertz" on Justia Law

Devon Energy Production Company, L.P. was engaged in gas production from two New Mexico units under a federal lease, which required payment of royalties to the federal government. State officials, acting under federal authority, audited Devon Energy’s operations and disallowed certain deductions related to the treatment and transportation of natural gas over a four-year period. The charges for these services were bundled, making it difficult to separate deductible from non-deductible costs. A related Devon entity had previously resolved a similar dispute with the government through a settlement agreement, which established formulas for calculating allowable deductions.The Office of Natural Resources Revenue, a federal agency, reviewed Devon Energy’s objections to the audit and upheld the disallowance, ordering payment of the contested royalties or further documentation. Devon Energy sought review in the United States District Court for the Western District of Oklahoma, arguing that the agency acted arbitrarily and capriciously by not considering the prior settlement agreement. The district court affirmed the agency’s decision, reasoning that the agreement did not cover all disputed royalties.The United States Court of Appeals for the Tenth Circuit reviewed the case de novo, applying the arbitrary-and-capricious standard. The Tenth Circuit found that the agency erred by failing to consider the prior settlement agreement, which may have had significant legal and factual implications for the calculation of deductions. The court also found that the record was insufficient to support the government’s alternative arguments for affirmance, such as the identity of the contracting entity and the expiration of the agreement’s terms. The Tenth Circuit reversed the district court’s judgment and remanded the case for the district court to determine the appropriate remedy—whether vacatur of the agency’s decision or a remand to the agency is warranted. View "Devon Energy Production Company v. DOI" on Justia Law

KC Transport, an independent trucking company, provides hauling services for mining and other companies. It operates a maintenance facility for its haul trucks about a mile from one of its primary client’s active mines. During an inspection, a Mine Safety and Health Administration (MSHA) inspector observed two KC Transport trucks at the facility undergoing maintenance in conditions that violated federal safety standards—specifically, the trucks were raised and unblocked, with one worker standing underneath. The inspector issued citations for these violations.In an administrative proceeding, KC Transport contested the citations, arguing that MSHA lacked jurisdiction over its facility and trucks since they were not located at an extraction site or on an appurtenant road. An administrative law judge (ALJ) found that MSHA had jurisdiction, reasoning that the facility and trucks were “used in” mining-related activities and thus constituted a “mine” under the Federal Mine Safety and Health Amendments Act. KC Transport appealed, and the Federal Mine Safety and Health Review Commission reversed the ALJ, holding that only facilities or equipment located at extraction sites or appurtenant roads qualify as “mines” under the Act and vacated the citations.The Secretary of Labor, acting through MSHA, petitioned the United States Court of Appeals for the District of Columbia Circuit for review. After an intervening Supreme Court decision overruled Chevron deference, the D.C. Circuit independently interpreted the relevant statutory provisions. The court held that a “facility” constitutes a “mine” under the Mine Act when it is necessarily connected with the use and operation of extracting, milling, or processing minerals, even if not located directly at an extraction site or appurtenant road. Concluding that KC Transport’s facility met this definition, the court vacated the Commission’s decision and affirmed the Secretary’s citations. View "Secretary of Labor v. KC Transport, Inc." on Justia Law

Several oil refineries with average daily crude oil throughput below 75,000 barrels in 2024 applied to the Environmental Protection Agency (EPA) in 2025 for exemptions from their obligations under the Renewable Fuel Standard (RFS) program for the 2024 compliance year. The RFS program, established under the Clean Air Act, requires refineries to blend renewable fuels into transportation fuels. The Act provides for a “small refinery” exemption for facilities that do not exceed the 75,000-barrel threshold in a calendar year. The petitioning refineries did not seek exemptions for 2023 and based their applications solely on their 2024 throughput.After the refineries submitted their applications, the EPA informed them that, under its 2014 regulation, eligibility required a refinery to meet the “small refinery” definition both for "the most recent full calendar year prior to seeking an extension" and for "the year or years for which an exemption is sought." The EPA interpreted this to mean petitioners needed to satisfy the throughput limit in both 2023 and 2024. Since the refineries exceeded the threshold in 2023, the EPA denied the exemption requests. The refineries then sought review in the United States Court of Appeals for the District of Columbia Circuit.The D.C. Circuit held that the EPA’s interpretation of its 2014 regulation was contrary to the regulation’s plain text. The court found that, because the applications were filed in 2025 for the 2024 compliance year, both the “most recent full calendar year prior to seeking an extension” and “the year for which an exemption is sought” referred to 2024. Since the petitioners met the threshold in 2024, they were eligible under the regulation. The court vacated the EPA’s denial orders and remanded for further proceedings. View "Alon Refining Krotz Springs, Inc. v. EPA" on Justia Law

Minority shareholders of an Argentine oil and gas company, previously privatized in 1993, became involved in litigation after the Argentine government expropriated a majority stake in the company in 2012. The government’s acquisition of shares was conducted without making a public tender offer to minority shareholders, a process that was explicitly required by the company’s bylaws to protect such shareholders in the event of a takeover. The plaintiffs, consisting of Spanish entities and a New York hedge fund, had acquired significant stakes in the company, and after the expropriation, they claimed that they suffered substantial financial losses due to the government’s failure to comply with the tender offer requirement.The plaintiffs sued in the United States District Court for the Southern District of New York, asserting breach of contract and promissory estoppel claims under Argentine law against both the Argentine Republic and the company. After extensive litigation, the district court found in favor of the plaintiffs on their breach of contract claims against the Argentine Republic, awarding over $16 billion in damages, but granted summary judgment to the company, finding it had no obligation to enforce the tender offer provision. The court also dismissed the promissory estoppel claims.On appeal, the United States Court of Appeals for the Second Circuit held that the plaintiffs' breach of contract damages claims against the Argentine Republic and the company were not cognizable under Argentine law, reasoning that the bylaws did not create enforceable bilateral obligations between shareholders and that Argentine public law governing expropriation precluded such claims. The court affirmed the dismissal of the promissory estoppel claims and judgment in favor of the company, but reversed the judgment against the Argentine Republic, remanding for further proceedings consistent with its opinion. View "Petersen Energía v. Argentine Republic" on Justia Law

A renewable energy developer was awarded a standard-offer contract in 2014 to build a solar facility in Bennington, Vermont, with a requirement to commission the project by 2016. The developer repeatedly sought and received extensions to this deadline, while simultaneously pursuing a certificate of public good (CPG), which is also required for construction. The Public Utility Commission (PUC) granted the CPG in 2018, but it was appealed, reversed, and ultimately denied on remand due to violations of local land conservation measures and adverse impacts on aesthetics. The Vermont Supreme Court affirmed the final CPG denial in 2023.While litigation over the CPG was ongoing, the developer continued to seek extensions of its standard-offer contract’s commissioning milestone. The fifth extension request, filed in 2021, asked for a deadline twelve months after the Supreme Court’s mandate in the CPG appeal. The hearing officer recommended granting it, but the PUC did not act on the request until 2024, by which time the developer’s CPG had been finally denied. The PUC dismissed the fifth extension request as moot, finding the contract had expired by its own terms. The PUC also denied the developer’s motion for reconsideration and a sixth extension request, on the same grounds.On appeal, the Vermont Supreme Court reviewed the PUC’s actions with deference, upholding its factual findings unless clearly erroneous and its discretionary decisions unless there was an abuse of discretion. The Court held that the PUC properly concluded the requested extension was moot, the contract was null and void by its terms, and there was no abuse of discretion. The Court also rejected arguments that the PUC’s actions were inconsistent with other cases or violated constitutional rights. The orders of the PUC were affirmed. View "In re Petition of Apple Hill Solar LLC" on Justia Law

California’s net energy metering (NEM) program has, for decades, allowed utility customers with renewable energy systems to receive credit for excess electricity sent to the grid. Concerns grew that this system resulted in a substantial subsidy for NEM customers, shifting costs to non-NEM ratepayers. In 2013, the Legislature enacted a law requiring the Public Utilities Commission (Commission) to create a successor tariff that balanced the costs and benefits of customer-sited renewable energy, ensured sustainable growth, and prevented cost-shifting. After years of study and rulemaking, the Commission adopted a new tariff in 2022, fundamentally changing how credits for exported power are calculated and introducing measures aimed at equity and system sustainability.Petitioners, which included environmental and community advocacy groups, challenged the new tariff before the Commission and, after rehearing was denied, sought review in the California Court of Appeal, First Appellate District. The court initially affirmed the Decision, applying a highly deferential standard of review. Petitioners then sought review in the California Supreme Court, which held that the standard used was too deferential and directed the appellate court to apply the standard articulated in Yamaha Corp. of America v. State Board of Equalization, which requires courts to independently assess whether the agency acted within its delegated authority and consistent with the law.On remand, the California Court of Appeal, First Appellate District, reviewed the tariff under this framework. The court concluded the Commission’s actions were within its delegated authority and that the successor tariff satisfied statutory requirements for sustainable growth, equitable treatment of disadvantaged communities, and balancing of costs and benefits. The court rejected petitioners’ arguments that the tariff failed to consider all relevant benefits or improperly disadvantaged certain groups. The court affirmed the Commission’s Decision and awarded costs to the Commission and real parties in interest. View "Center for Biological Diversity, Inc. v. Public Utilities Commission" on Justia Law