Justia Energy, Oil & Gas Law Opinion Summaries

Casey Voigt appealed a judgment affirming the Public Service Commission's ("Commission") order that affirmed its conditional approval of a surface coal mining permit for Coyote Creek Mining Company, L.L.C. ("Company"). The Supreme Court concluded the Commission's order complied with applicable law requiring identification and protection of "alluvial valley floors" and sufficiently addressed Voigt's evidence. Furthermore, the Court concluded the Commission's conclusions of law regarding the lack of "alluvial valley floors" within or adjacent to the permit area was supported by the findings of fact and that reasonable minds could have determined the Commission's findings of fact were proved by the weight of the evidence from the entire record. View "Voigt v. N.D. Public Service Commission" on Justia Law

Plaintiffs filed suit against oil and gas companies and their insurers, claiming that the companies' dredging activities caused damage to the fisheries the fishermen used. The district court granted summary judgment for Florida Gas and Southern Natural because plaintiffs did not create a genuine issue of material fact as to whether the companies' activities constituted "dredging" so as to support maritime tort claims. The district court then denied plaintiffs' motion for reconsideration. The court affirmed the district court's judgment as to Florida Gas because none of plaintiffs' evidence created a genuine issue of material fact as to whether Florida Gas participated in dredging activities. However, the court reversed the district court's judgment as to Southern Natural because plaintiffs presented new, conclusive evidence in their motion for reconsideration pertaining to Southern Natural that they were justified in not presenting earlier. In this case, plaintiffs provided three types of new evidence upon reconsideration: Southern Natural's deposition transcript; documentary evidence offered during Southern Natural's deposition; and Southern Natural's responses to requests for admission. The court disagreed with the district court's analysis, particularly as it pertained to Southern Natural's deposition transcript and responses to requests for admission. The court explained that these items were clearly probative and, if the district court would have considered the contents of Southern Natural's deposition or its admissions, plaintiffs would have defeated summary judgment as to Southern Natural. View "In Re: Louisiana Crawfish Producers" on Justia Law

This appeal arose from a merger agreement under which two companies involved in the gas pipeline business, Energy Transfer Equity, L.P. (“ETE”), agreed to acquire the assets of The Williams Companies, Inc., (“Williams”). The Merger Agreement signed by Williams and ETE contemplated two steps: (1) Williams would merge into a new entity, Energy Transfer Corp LP (“ETC”); and (2) the transfer of Williams’ assets to ETE in exchange for Class E partnership units “would” be a tax-free exchange of a partnership interest for assets under Section 721(a) of the Internal Revenue Code. After the parties entered into the Agreement, the energy market suffered a severe decline which caused a significant loss in the value of assets of the type held by Williams and ETE. This caused the transaction to become financially undesirable to ETE. This issue ultimately led to ETE’s tax counsel, Latham & Watkins, LLP (Latham) being unwilling to issue the 721 opinion. Since the 721 opinion was a condition of the transaction, ETE indicated that it would not proceed with the merger. Williams then sought to enjoin ETE from terminating the Merger Agreement. The Court of Chancery rejected Williams’ arguments. After review, the Supreme Court found the Court of Chancery adopted an unduly narrow view of the obligations imposed by the covenants in the Agreement. The Supreme Court agreed with Williams that if a proper analysis of ETE’s covenants led to a conclusion that ETE breached those covenants, the burden would have shifted to ETE to prove that its breaches did not materially contribute to the failure of the closing condition. Since the facts as found by the Court of Chancery were that ETE’s lack of conduct did not contribute to Latham’s decision not to issue the 721 opinion, the Supreme Court was satisfied that when the burden of proving that ETE’s alleged breach of covenants is properly placed on it, ETE did meet its burden of proving that any alleged breach of covenant did not materially contribute to the failure of the Latham condition. The Court also agrees with the Court of Chancery’s finding that ETE was not estopped from terminating the Agreement. Accordingly, the judgment of the Court of Chancery was affirmed. View "Williams Companies, Inc. v. Energy Transfer Equity, L.P." on Justia Law

In 2010, The Kansas Department of Health and Environment (KDHE) issued a prevention of significant deterioration (PSD) construction permit to Sunflower Electric Power Corporation that authorized Sunflower to build a coal-fired electric generating unit at a site where Sunflower already operates a coal-fired station. In Sierra Club I, the Supreme Court held that KDHE had failed to comply with the federal Clean Air Act and remanded the permit to KDHE. On remand, KDHE issued an addendum to the 2010 permit. Sierra Club sought judicial review of that action, arguing, inter alia, that KDHE was required to conduct an entirely new permitting process rather than simply crafting an addendum to the 2010 permit. The Supreme Court affirmed, holding (1) KDHE did not err in adding an addendum to the 2010 permit; and (2) Sierra Club failed to establish any other basis for invalidating Sunflower’s PSD permit. View "Sierra Club v. Mosier" on Justia Law

After the Mississippi Supreme Court held in "Jones County School District v. Mississippi Department of Revenue," (111 So. 3d 588 (Miss. 2013)), that a school district was not liable for oil and gas severance taxes on royalties derived from oil and gas production on sixteenth-section land, the Chancery Court of Wayne County held that Wayne County School District (WCSD) was owed interest by the Mississippi Department of Revenue (MDOR) on its overpayment of severance taxes at the rate of one percent (1%) per month. The chancellor determined, based on Section 27-65-53 of the Mississippi Code, that the payment should have started on June 5, 2013, ninety days after the Jones County decision. Finding that the chancellor correctly applied the statute, the Supreme Court affirmed the judgment of the chancery court. View "Wayne County School District v. Morgan" on Justia Law

The issue in this case centered on the interpretation of the "right to travel" provision Article III of the Yakama Nation Treaty of 1855, in the context of importing fuel into Washington State. The Washington State Department of Licensing (Department) challenged Cougar Den Inc.'s importation of fuel without holding an importer's license and without paying state fuel taxes under former chapter 82.36 RCW, repealed by LAWS OF 2013, ch. 225, section 501, and former chapter 82.38 RCW (2007). An administrative law judge ruled in favor of Cougar Den, holding that the right to travel on highways should be interpreted to preempt the tax. The Department's director, Pat Kohler, reversed. On appeal, the Yakima County Superior Court reversed the director's order and ruled in favor of Cougar Den. Finding no reversible error in that judgment, the Washington Supreme Court affirmed. View "Cougar Den, Inc. v. Dep't of Licensing" on Justia Law

The Federal Energy Regulatory Commission issued to Tennessee Gas Pipeline Company, LLC a certificate of public convenience and necessity for a proposed project. The certificate was subject to filing of proof that Tennessee Gas received all applicable authorizations required under federal law. Tennessee Gas subsequently received from the Massachusetts Department of Environmental Protection (MassDEP) conditional certification for its proposed project. Petitioners filed a notice of claim for adjudicatory hearing to appeal the conditional certification. Tennessee Gas opposed the request for a hearing, arguing that once the agency had issued a conditional water quality certification, any further review must be pursued through a petition to the First Circuit. Tennessee Gas then filed suit in the District of Massachusetts seeking to bar MassDEP from engaging in further review. Petitioners filed this petition to preserve review of the conditional certification but asked the Court to reject their petition on the grounds that the Court’s review was premature until MassDEP completed its adjudicatory process. The First Circuit dismissed the petition for lack of subject matter jurisdiction because there was no order or action of MassDEP in connection with Tennessee Gas’s application for a water quality certification that the Court could review under 15 U.S.C. 717r(d)(1). View "Berkshire Environmental Action Team, Inc. v. Tennessee Gas Pipeline Co." on Justia Law

BP built and maintained the Atlantis Platform, a semi-submersible floating oil production facility located in the Gulf of Mexico. Plaintiff Keith Abbott, employed by BP in the Atlantis administrative offices, filed suit under the False Claims Act (FCA), 31 U.S.C. 3730(b)(2), claiming that BP falsely certified compliance with various regulatory requirements. While DOI was investigating Atlantis, Abbott amended his complaint to add Food & Water Watch as a plaintiff and included additional claims for violations of the Outer Continental Shelf Lands Act (OCSLA), 43 U.S.C. 1331 et seq. On appeal, plaintiffs challenged the district court's grant of summary judgment for BP on all claims. In this case, plaintiffs' FCA claims centered on whether engineers approved the various stages of construction of Atlantis. The court explained that these facts failed to create an issue of fact as to materiality given the particular circumstances in plaintiffs' case. In light of Universal Health Servs., Inc. v. United States ex rel. Escobar, when the DOI decided to allow Atlantis to continue drilling after a substantial investigation into plaintiffs' allegations, that decision represented "strong evidence" that the requirements in those regulations were not material. In regard to plaintiffs' OCSLA claims, the court concluded that plaintiffs lack standing because they failed to plead individualized injuries. Accordingly, the court affirmed the judgment. View "Abbott v. BP Exploration & Production" on Justia Law

Ronnie Nelson owned a surface estate in Burke County who sought to use the mineral lapse statutes to obtain the mineral rights associated with the surface estate. Nelson published a notice of lapse of mineral interest against McAlester Fuel Company ("McAlester") for three consecutive weeks. Nelson filed an action to quiet title on 108 mineral acres in Burke County, a notice of no personal claim, and a sheriff's return in district court. Before filing his action to quiet title, Nelson also mailed a notice of claim and attempted to personally serve McAlester. The address to which Nelson mailed notice of claim appeared on a mineral deed dated March 6, 1958. McAlester filed no statement of claim within 60 days after Nelson published the notice of lapse. Nelson's complaint alleged he had substantially complied with the statutory procedure for claiming abandoned minerals. Nelson moved for entry of default judgment, and based upon what was provided to the district court and the fact McAlester did not file a statement of claim, the district court found McAlester had failed to use the mineral interests. The district court entered a default judgment on February 3, 2009. In 2015, McAlester filed a motion to vacate the default judgment. The district court concluded the judgment against McAlester was void and entered an order vacating the judgment quieting title. In its order to vacate, the district court determined Nelson failed to comply with the notice requirements of the statutory procedure for claiming abandoned minerals. McAlester moved to dismiss Nelson's action to quiet title for failure to state a claim and judgment on the pleadings. Nelson opposed the motion. Ultimately, the district court granted McAlester's motion to dismiss Nelson's quiet title action. On appeal, Nelson argued the district court erred because it concluded the abandoned mineral statute "requires a surface owner to conduct a reasonable inquiry to find a mineral owner's current address, even when an address appears of record." The Supreme Court found that this was not the basis for the district court's decision: the district court stated Nelson's mailing was not "reasonably certain" to reach McAlester. However, the district court then stated, "[a]llowing a claimant to pick any address from the record would encourage the claimant to always mail notice to the oldest address in the record in hopes that the address is stale, and that the notice would therefore not reach the intended target." The Supreme Court agreed with the district court that Nelson failed to comply with the statutory notice procedure, and affirmed its judgment. View "Nelson v. McAlester Fuel Company" on Justia Law

Dunn County appealed a judgment declaring the Industrial Commission had exclusive jurisdiction to determine the location of oil and gas waste treating plants. The Supreme Court affirmed, concluding the County lacked the power to veto the Commission's approval of the location for an oil and gas waste treating plant. View "Environmental Driven Solutions v. Dunn County" on Justia Law