Vol. 6, No. 16

Topics discussed in this week’s Report include:

  • Landowners continue challenge to Delaware River Basin Commission’s authority to prohibit hydraulic fracturing.
  • New York denied permits for proposed Northern Access Pipeline.
  • Oklahoma class action alleging wastewater injection caused earthquakes remanded to state court.

Landowners continue challenge to Delaware River Basin Commission’s authority to prohibit hydraulic fracturing. On April 11, a landowners group, Wayne Land and Mineral Group LLC, appealed to the U.S. Court of Appeals for the Third Circuit a district court decision that held that the Delaware River Basin Commission (DRBC) has the authority to regulate and temporarily ban oil and gas development in part of the Marcellus Shale located within the Delaware Basin. Since 2009, the DRBC has barred new oil and gas development in the area while it considers draft rules to regulate development, including the use of hydraulic fracturing. The landowners group owns approximately 180 acres in Pennsylvania, where it would conduct oil and gas operations if permitted. The group argued before the district court that the de facto moratorium exceeds DRBC’s authority to regulate water resources. The U.S. District Court for the Middle District of Pennsylvania disagreed and ruled in favor of DRBC in March, finding that drilling in the Marcellus Shale is within the DRBC’s broad jurisdiction to protect the watershed. Briefing and argument on the appeal are expected later this year.

New York denies permits for proposed Northern Access Pipeline. Earlier this month, the New York Department of Environmental Conservation (DEC) declined to issue permits for National Fuel Gas Company’s Northern Access Pipeline. The proposed project is estimated to cost $455 million and would carry natural gas from operations in Pennsylvania to Canada, following a route through New York. DEC held three public hearings and received over 5,700 public comments on the project. It ultimately denied the permits after finding that the company’s applications for water quality certification and stream and wetlands disturbance permits did not comply with state water quality standards. DEC was particularly concerned with increased turbidity that the pipeline project was projected to cause, which DEC said will impede best usage of many of the state’s waterbodies by degrading the survival of indigenous species. In a public statement, the company criticized the decision, noting the state has issued permits to other projects with potentially more significant environmental impact and objecting to the agency’s decision to wait until the last minute to issue the denial. The company has not announced whether it will pursue an appeal.

Oklahoma class action alleging wastewater injection caused earthquakes remanded to state court. The U.S. District Court for the Northern District of Oklahoma determined that a class action lawsuit alleging that hydraulic fracturing operations caused earthquakes in Pawnee County, Oklahoma, should be remanded to state court this week. The case was originally filed in Pawnee County District Court in 2016. The claims focus on whether wastewater injection well operations caused earthquakes in the area that damaged the class members’ property. The defendants had removed the case to federal court under the assumption that plaintiff included owners of trust or restricted land in the class that are subject to federal land regulations. They sought dismissal of the case on the basis that the plaintiff hadn’t complied with federal pleading requirements and had failed to allege the specific operations that caused his property damage. Instead of deciding the merits of the case, Judge Claire Eegan remanded it on jurisdictional grounds, finding that the putative class action did not include any land subject to federal regulation, and therefore there were no substantive issues remaining to confer federal jurisdiction.