Justia Energy, Oil & Gas Law Opinion Summaries

GEM Razorback, LLC appealed a judgment dismissing its declaratory judgment action because GEM failed to exhaust administrative remedies, and dismissing its claim for specific performance because GEM could not establish that it was a third-party beneficiary of a contract. GEM and Zenergy, Inc. owned working interests in two oil and gas wells located in McKenzie County. Zenergy operated the wells, but GEM had not consented to pay its share of the drilling and operating costs. GEM did not execute a joint operating agreement for the wells and consequently was assessed a risk penalty as a nonconsenting owner. In 2013, Zenergy assigned its interest in the wells to Oasis Petroleum North America LLC. The assignment conveyed all assets, including "all files, records and data maintained by" Zenergy. After the assignment, GEM requested the same information from Oasis. Oasis provided Zenergy with the requested information. However, according to Oasis, some of the requested information for the time period before the assignment was not in its possession. Because of differences in the numbers provided by Zenergy and Oasis, GEM filed applications for hearing with the Industrial Commission requesting that the Commission determine the actual reasonable costs plus risk penalty for the two wells. After a hearing, Oasis agreed to allow GEM to conduct an audit of the wells. The Commission then dismissed the applications without prejudice. During the ensuing audit process, GEM discovered there were documents it requested that were not in Oasis' possession for the time period before the assignment when Zenergy operated the wells. GEM contacted Zenergy and requested an extensive list of 39 specific types of information regarding the wells. Zenergy refused to provide GEM with the requested information. GEM then commenced its declaratory judgment and specific performance action against Zenergy. Zenergy argued the district court lacked subject matter jurisdiction over the request for declaratory relief because GEM failed to exhaust its administrative remedies with the Commission before filing the complaint. Zenergy further argued the claim for specific performance failed to state a claim upon which relief could be granted because a provision of the assignment agreement specifically bars third-party beneficiary status. The court agreed with Zenergy's arguments and dismissed GEM's action. Finding no reversible error, the Supreme Court affirmed the district court’s ruling. View "GEM Razorback, LLC v. Zenergy, Inc." on Justia Law

At issue in this case was whether Colorado had jurisdiction to award benefits for out-of-state work-related injuries and to impose a statutorily penalty on an employer under 8-41-204, C.R.S. (2016), when the employer was not a citizen of Colorado, and had no offices or operations in Colorado, only that the employer hired a Colorado citizen within the state. The Supreme Court held that on the facts presented here, Colorado lacked personal jurisdiction over the employer. View "Youngquist v. Miner" on Justia Law

Virginia Uranium filed suit seeking a declaration that the ban on mining the Coles Hill uranium deposit was preempted by federal law and an injunction compelling the Commonwealth to grant uranium mining permits. The district court granted the Commonwealth's motion to dismiss. On appeal, Virginia Uranium maintains that the Atomic Energy Act preempts Virginia's ban on uranium mining. The court concluded that the district court correctly held that Virginia's ban on conventional uranium mining is not preempted. The court explained that, because conventional uranium mining outside of federal lands is beyond the regulatory ambit of the Nuclear Regulatory Commission, it is not an "activity" under section 2021(k) of the Act. The court rejected Virginia Uranium's contention that uranium-ore milling and tailings storage are activities under section 2021(k) of the Act, and concluded that the Commonwealth’s mining ban does not purport to regulate an activity within the Act's reach. Finally, the court concluded that the district court properly dismissed the case where Congress's purposes and objectives in passing the Act are not materially affected by the Commonwealth's ban on conventional uranium mining. Accordingly, the court affirmed the judgment. View "Virginia Uranium v. Warren" on Justia Law

XTO Energy, Inc., appealed and Darwin and Jean Krenz cross-appealed a judgment awarding the Krenzes $800,000 for a pipeline trespass and ordering the parties to abide by certain documents for their future relationship after the district court construed a pipeline easement to authorize one pipeline on the Krenzes' land and found XTO's unauthorized construction and operation of a second pipeline on the Krenzes' land and use of their private road was a trespass. After review of this matter, the North Dakota Supreme Court concluded an April 2007 pipeline easement was ambiguous and the court erred in construing the easement as a matter of law. The Court therefore reversed the trial court's decision construing the pipeline easement and awarding the Krenzes $800,000 for the pipeline trespass and the court's decision requiring the parties to abide by their unexecuted negotiations involving their future relationship. View "Krenz v. XTO Energy, Inc." on Justia Law

Willard Burk appealed a judgment declaring his claim that the State, through the Board of University and School Lands, and the Tax Commissioner (collectively "State"), wrongfully withheld gross production and extraction taxes from his share of oil and gas royalties was frivolous, entitling them to an award of attorney fees. After review, the North Dakota Supreme Court affirmed the district court's decision that, as a matter of law, the State's settlement agreement with Burk did not exempt him from paying gross production and extraction taxes on his royalty interest, but reversed the award of attorney fees because Burk's claim against the State was not frivolous. View "Burk v. North Dakota" on Justia Law

Maxxim’s Sidney, Kentucky repair shop makes and repairs mining equipment and machine parts, employing seven workers. Roughly 75% of the shop’s work is for equipment that Alpha (Maxxim’s parent company) uses to extract or prepare coal at several mines. The rest of the work is for other mining companies and for repair shops that might sell the equipment to mining or non-mining companies. The Maxxim facility does not extract coal or any other mineral, and it does not prepare coal or any other mineral for use. Sidney Coal, another Alpha subsidiary, owned the property and had an office in the upper floor of the Maxxim shop. The Mine Safety and Health Administration had asserted jurisdiction (30 U.S.C. 802(h)) over the Sidney shop and, in 2013, issued several citations. Maxxim challenged the Administration’s power to issue the citations. An administrative law judge’s ruling that the Sidney shop was “a coal or other mine” was upheld by the independent agency responsible for reviewing the Administration’s citations. The Sixth Circuit reversed. The definition of “coal or other mine” refers to locations, equipment and other things in, above, beneath, or appurtenant to active mines; the Maxxim facility is not a mine subject to the Administration’s jurisdiction. View "Maxxim Rebuild Co., LLC v. Mine Safety & Health Administration" on Justia Law

The issue this case presented for the Supreme Court's review centered on the standard of liability for violations of two provisions of the hazardous waste laws: 40 CFR section 263.20(a)(1), as adopted by OAR 340-100-0002(1), and ORS 466.095(1)(c). The Department of Environmental Quality (the department) assessed civil penalties against petitioner, Oil Re-Refining Company (ORRCO), after it determined that ORRCO had accepted hazardous waste without a proper manifest form and treated hazardous waste without a proper permit. ORRCO conceded the factual basis for those allegations but asserted a reasonable-reliance defense: namely, that it reasonably relied on assurances by the generator of the waste that the material ORRCO transported and treated was not a hazardous waste, and, therefore, did not require the manifest and permit at issue. The Environmental Quality Commission (the commission) refused to consider ORRCO’s defense, because it interpreted the relevant provisions as imposing a strict liability standard. The Court of Appeals agreed with the commission’s interpretations and affirmed its final order finding various violations and imposing civil penalties. On appeal to the Supreme Court ORRCO argued that the commission should have considered its reasonable reliance defense and that the commission had erred in interpreting the relevant provisions as imposing a standard of strict liability. The Supreme Court rejected ORRCO’s argument because it ignored statutory and regulatory context indicating that a transporter’s or operator’s level of culpability is immaterial to establishing a violation of the relevant provisions. View "Oil Re-Refining Co. v. Environmental Quality Comm." on Justia Law

This case concerns BP's obligations under the Deepwater Horizon Economic and Property Damages Settlement Agreement. Appellant is a company that filed Business Economic Loss claims under the settlement agreement on behalf of five of its stores. The CSSP and the Appeal Panel determined that the stores were not tourism businesses and denied the claims for failure to satisfy the causation requirement. In this consolidated appeal, appellant challenged the district court's denial of discretionary review. The court concluded that there was no abuse in discretion in classifying the stores under North American Industry Classification System (NAICS) code 441310 as automotive parts and accessories stores. Accordingly, the court affirmed the judgment. View "Claimant ID 100212278 v. BP Exploration & Production" on Justia Law

Until 1997, Illinois residents could only purchase power from a public utility, with rates regulated by the ICC. The Electric Service Customer Choice and Rate Relief Law allows residents to buy electricity from their local public utility, another utility, or an Alternative Retail Electric Supplier (ARES). The ICC was not given rate-making authority over ARESs, but was given oversight responsibilities. The Law did not explicitly provide a mechanism for recovering damages from an ARES related to rates. Zahn purchased electricity from NAPG, after receiving an offer of a “New Customer Rate” of $.0499 per kilowatt hour in her first month, followed by a “market-based variable rate.” Zahn never received NAPG’s “New Customer Rate.” NAPG charged her $.0599 per kilowatt hour for the first two months, followed by a rate higher than Zahn’s local public utility charged. Zahn filed a class-action complaint, claiming violations of the Illinois Consumer Fraud and Deceptive Business Practices Act, breach of contract, and unjust enrichment. The court dismissed for lack of subject-matter jurisdiction, or for failure to state a claim. After the Illinois Supreme Court answered a certified question, stating that the ICC does not have exclusive jurisdiction to hear Zahn’s claims, the Seventh Circuit reversed. The district court had jurisdiction and Zahn alleged facts that, if true, could constitute a breach of contract or a deceptive business practice. View "Zahn v. North American Power & Gas, LLC" on Justia Law

An oil-and-gas lessor sued the lessee for failure to pay royalties. The trial court concluded that the lessor’s neighboring landowners were necessary parties to the suit and dismissed the case without prejudice because the lessor failed to join them. The court of appeals affirmed, concluding that the trial court did not abuse its discretion in requiring joinder. The Supreme Court reversed, holding that the trial court abuse its discretion in requiring joinder under Tex. R. Civ. P. 39 and dismissing the case because the adjacent landowners did not claim an interest relating to the subject of the lessor’s suit against the lessee. Remanded for further proceedings. View "Crawford v. XTO Energy, Inc" on Justia Law