Fracking Insider Readers: We are pleased to bring you Volume 31 of our State Regulatory Roundup, including updates in New Jersey and North Carolina, as well as an update regarding an effort by governors to protect the primacy of state-level energy policymaking. As we explained in earlier volumes, we designed the Roundup to provide quick overviews on state regulatory activity. If you have any questions on any of these summaries, please do not hesitate to ask.

Multi-state – Twelve state governors signed a letter released December 13th supporting the States First Initiative, which seeks to bolster the role of states as the governing entities with primary jurisdiction over oil and gas development. Recipients of the letter included major energy policy figures such as EPA Administrator Gina McCarthy, Interior Secretary Sally Jewell, Energy Secretary Ernest Moniz, and members of the House and Senate Natural Resources Committees. The letter also announced the creation of the State Oil and Gas Regulatory Exchange (SOGRE), which will facilitate the regular interaction of state policy and technical staff to discuss scientific and regulatory challenges to the oil and gas industries. The letter-writing effort was organized by the Interstate Oil & Gas Commission and the Ground Water Protection Council, which represent state regulators. The governors that signed the letter were Phil Bryant (R-MI), Robert Bentley (R-AL), Steven Beshear (D-KY), Steve Bullock (D-MT), Tom Corbett (R-PA), Jack Dalrymple (R-ND), Mary Fallin (R-OK), Gary Herbert (R-UT), John Hickenlooper (D-CO), Sean Parnell (R-AK), Rick Perry (R-TX), and Brian Sandoval (R-NV).

New Jersey – The New Jersey Pinelands Commission rejected an agreement with the state Board of Public Utilities that would have granted a variance to allow the construction of fifteen miles of natural gas pipeline through the protected Pinelands Area. In a January 10th vote that would have required eight affirmative votes to pass, the fifteen member commission split 7-7, with one member not present. The vote is a major impediment to completion of a 22-mile pipeline that would have repowered the BL England generation plant, which is converting from coal to natural gas on orders of the state Department of Environmental Protection. The commissioners rejected the agreement despite a report from their own staff that recommended approval of the pipeline’s construction. The staff report concluded that the pipeline would not significantly disturb wetlands, harm threatened or endangered species, impact stormwater management, or affect fire hazard mitigation standards.

North Carolina – Draft rules approved January 14th by the state Mining and Energy Commission would require companies to disclose the contents of their hydraulic fracturing fluid. The rules would allow companies to claim trade secret protection for specific chemicals and formulations, but would still require information on the chemical category and hazard class. Further, the proprietary protections could be lifted if the information were necessary to respond to a spill or for a medical diagnosis. The draft rules still need to be approved by a rulemaking oversight panel and by lawmakers. These disclosure rules, along with dozens of others under development, are part of a larger effort by the state to lift its ban on hydraulic fracturing. Lawmakers considered lifting the moratorium during the last legislative session, but decided to maintain the ban while regulations are still under development. The commission is promulgating regulations on hydraulic fracturing and associated issues under two laws, S.L. 2013-365 and S.L. 2012-143, with the first hydraulic fracturing permits expected to be approved in early 2015.