Justia Energy, Oil & Gas Law Opinion Summaries

The dispute between the parties in this case centered over mineral rights. Stull Ranches, LLC operated a grouse hunting business on its surface estate in rural Colorado. Entek GRB, LLC leased the right to explore and develop the minerals under much of Stull’s surface and adjoining surface estates from the federal government. This dispute arose when Entek asked permission to enter Stull’s surface estate (both to develop new oil well sites on Stull’s land and to get at one of its existing wells located on an adjacent surface estate owned by the Bureau of Land Management). Along the way, Entek pointed out that the only available road to the well on BLM’s estate crossed Stull’s land. Concerned that Entek’s presence would unsettle its grouse, Stull refused access. Entek sued to gain access. The district court held that Entek was entitled to access portions of Stull’s surface to mine certain leases lying below. But the court also held that Entek was entitled to no more than this - in particular, Entek could not cross Stull’s surface to service the well on the adjacent BLM land. Entek appealed, arguing to the Tenth Circuit that the district court erred by not granting it access to BLM lands. Upon review, the Tenth Circuit agreed that the district court in not granting Entek the relief it originally requested. The Court therefore vacated the grant of summary judgment in favor of Stull and remanded the case for further proceedings. View "Entek GRB, LLC v. Stull Ranches, LLC" on Justia Law

The Federal Energy Regulatory Commission is a federal agency that, under the Federal Power Act, regulates rates charged by public utilities for transmission and sale of energy in interstate commerce, and rules pertaining to such rates, 16 U.S.C. 824d. In 2006, FERC approved a new tariff (rules governing interstate sale of electricity and electric capacity) for the PJM market, covering 13 states and the District of Columbia, as a result of an extensively negotiated settlement between power providers, utility companies, government authorities and others. The order required that load serving entities (LSEs) in the market procure a certain amount of energy capacity for access during peak load; included a rule that offers for the sale of capacity in the markets at artificially low prices would, with some exceptions, be required to be raised to a competitive level (mitigation). In 2011, FERC altered the 2006 Order: eliminating a mitigation exemption for resources built under state mandate; eliminating a provision that guaranteed that LSEs would be able to use “self-supply” to satisfy capacity obligations; and changing factors used in determining whether an offer was subject to mitigation. Objectors argued that the changes amounted to direct regulation of power facilities in violation of the FPA, and that FERC arbitrarily eliminated the mitigation exemption for state-mandated resources. Electric utilities challenged elimination of self-supply assurances for LSEs. Others challenged new rules governing calculation of a resource’s net cost of new entry (for determining whether an offer for sale of capacity will be mitigated) and FERC’s determination that a new generation resource must clear only one capacity auction to avoid further mitigation. The Third Circuit rejected all of the challenges.View "NJ Bd. of Pub. Utils. v. Fed Energy Regulatory Comm'n" on Justia Law

Plaintiffs filed suit against defendants, the owners and operators of a neighboring mineral lease, alleging that defendants committed "unlawful drainage" in violation of federal and Louisiana law. The district court subsequently dismissed the Second Amended Complaint (SAC) under Rule 12(b)(6). The court concluded that the SAC stated a claim for waste against Defendant IP, the company that allegedly perforated a hydrocarbon reservoir named the K-1 sands. The court concluded, however, that the SAC insufficiently alleged that the non-perforating defendants committed waste. Accordingly, the court affirmed in part, vacated in part, and remanded. View "Breton Energy, L.L.C., et al. v. Mariner Energy Resources, Inc., et al." on Justia Law

In 2002 oil companies filed breach of contract actions against the government, concerning sales of offshore oil and glass leases in the 1980s. The Claims Court held that the government had breached its contracts by preventing the companies from drilling for oil in the offshore areas covered by the leases. The Federal Circuit affirmed the judgment and restitution awards of approximately $1 billion. Nycal, which held a 4.25 percent interest in two of the leases, waived its right to restitution and pursued a claim for lost profits. The Claims Court held that it was permissible for Nycal to seek lost-profits damages even though the other owners of the leases in which Nycal held a partial share had accepted restitution, but concluded that Nycal had not proved its case for lost profits. The Federal Circuit affirmed, noting the government’s evidence that Nycal could not have made a profit on its share of the leases.View "NYCAL Offshore Dev. Corp. v. United States" on Justia Law

The issue before the Supreme Court in this case involved the assessed value of the Trans-Alaska Pipeline System for property tax purposes. The parties disputed the method used to assess the pipeline's value as well as the specific deductions made for functional and economic obsolescence. Finding no reversible error, the Supreme Court affirmed the superior court's valuation. View "BP Pipelines (Alaska) Inc. v. Alaska" on Justia Law

Black Beauty contested a citation issued by an inspector of the Mine Safety and Health Administration, but the ALJ upheld the citation. Black Beauty now petitions for review of the ALJ's order again upholding the citation on remand. The court found substantial evidence to credit the ALJ's conclusion that Black Beauty violated 30 C.F.R. 77.1605(k) by failing to maintain a berm on two tenths of a mile of a bench; there was no reason to disturb the ALJ's conclusion that Black Beauty's violation was significant and substantial; and substantial evidence supported the ALJ's conclusion that Black Beauty's failure to follow the regulation constituted more than ordinary negligence and was thus "unwarrantable." Accordingly, the court denied the petition for review. View "Black Beauty Coal Co. v. Secretary of Labor, et al." on Justia Law

Butamax owns the 188 patent, which covers a recombinant microbial host cell that uses a particular biosynthetic pathway to produce isobutanol, which is useful as a fuel or fuel additive, and the 889 patent, which issued from a divisional of the 188 patent’ application and focuses on a method of producing isobutanol from a recombinant yeast microorganism that expresses a five-step biosynthetic pathway. The patents’ specifications largely are identical. The district court rejected Butamax’s claim of literal infringement and granted Gevo summary judgment of noninfringement under the doctrine of equivalents of the asserted claims and of invalidity of claims 12 and 13 of the 889 patent for lack of written description, and invalidity of claims 12 and 13 of the 889 patent for lack of enablement. The Federal Circuit vacated. The district court erred in its claim construction and determination under the doctrine of equivalents and failed to recognize the existence of genuine issues of material fact. The court reversed summary judgment of invalidity for lack of enablement because that judgment appeared to have been a scrivener’s error.View "Butamax(TM) Advanced Biofuels v. Gevo, Inc." 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

CEnergy filed suit against Glenmore claiming a denial of its right under the Fourteenth Amendment to substantive due process and a violation of the town's state law obligation to deal in good faith. While CEnergy obtained a conditional use permit from Glenmore to develop a wind farm, the company failed to obtain required building permits in time to take advantage of a lucrative opportunity to sell electricity generated by wind turbines to a Wisconsin power company. The court concluded that the town board's decision to delay action on CEnergy's building permit requests could not have been arbitrary in the constitutional sense. Even if the board's treatment of the building permit applications had been arbitrary in the constitutional sense, CEnergy still would have failed to state a substantive due process claim where a plaintiff who ignores potential state law remedies cannot state a substantive due process claim based on a state-created property right. Accordingly, the court affirmed the judgment of the district court. View "CEnergy-Glenmore Wind Farm #1 v. Town of Glenmore" on Justia Law

Entergy sells electricity in Arkansas, Louisiana, Mississippi, and Texas through its six operating companies. The System Agreement governs dealings between the companies and establishes an operating committee. In Appeal No. 13-60140, the first three orders on review arose from the Arkansas Commission's complaint requesting that FERC modify the System Agreement. In Appeal No. 13-60141, the two orders on review relate to a second bandwidth proceeding. The court concluded that FERC's corrective interpretation of the System Agreement's depreciation formula was reasonable, not arbitrary, and not otherwise discordant with law. The Louisiana Commission also challenged Entergy's reversal of the Vidalia transaction under the language of the System Agreement as an impermissible change to the formula rate without proper notice. The court dismissed the petition as an impermissible collateral attack. View "LA Public Service Commission v. FERC" on Justia Law