Environmental Litigation and Regulation

By Esteban Herrera and Dwayne Johnson

On October 14, 2009, the Louisiana Department of Environmental Quality (DEQ) issued General Permit No. LAG260000 for discharges within the territorial seas of Louisiana from oil and gas exploration, development, and production facilities.

In a lawsuit filed in state district court in Baton Rouge, the Louisiana Environmental Action Network

By Brittany L. Buckley

Effective today, October 20, 2011, new permitting and disclosure requirements apply to hydraulic fracturing operations in Louisiana. Known as “fracking” in the oil and gas industry, hydraulic fracturing refers to the process of injecting fluid into tight shale or sandstone formations, which creates fractures in the rock through which oil and gas may travel into the wellbore. When combined with horizontal drilling, fracking allows producers to capture oil and gas reserves that were once thought to be out-of-reach.

Pursuant to the newly-implemented amendment to Subpart I of LAC 43:XIX (Statewide Order 29-B), fracking operators must now apply for and obtain a specific permit for “hydraulic fracture stimulation” from the Louisiana Department of Natural Resources’ Office of Conservation before utilizing pressurized fluids to fracture any formation for the purpose of improving its ability to produce hydrocarbons. After obtaining the requisite permit and conducting its fracking operations, the operator must be prepared to publicly disclose (1) the types and volumes of base fluid used during fracking; (2) a detailed list of all additives used in the fluid and the name of the supplier for each type of additive; and (3) a list and concentration of any chemicals contained in the fracking fluid that are regulated by the Occupational Safety and Health Administration (OSHA) and reported on Materials Safety Data Sheets (MSDS). The lone exception to these disclosure requirements permits an operator to withhold trade secrets, but the regulations still require the operator to disclose pertinent chemical characteristics of even proprietary constituents used in fracking operations.

To comply with these disclosure requirements, the operator must utilize the Office of Conservation’s new WH-1 Form to disclose the information about the base fluids (discussed above), together with detailed information about the identities and volumes of water supplies used during each phase of fracking operations. In lieu of submitting the WH-1 Form directly to the Office of Conservation, the operator may elect to satisfy its chemical reporting obligations by publishing the required information to an online database that makes the information available to the public free of charge. If utilizing the online option, the operator must also furnish a written statement to the Office of Conservation certifying that all required information has been published in an online registry. FracFocus is one online database specifically endorsed by the new regulation, but the disclosure requirements can also be met by publishing the required information to any other “similar registry.” It is anticipated that the option to satisfy Louisiana’s new disclosure requirements by publishing information to FracFocus will be heavily utilized, as many oil and gas companies have already become accustomed to using this registry to comply with other states’ disclosure regulations.
 


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By Lee Vail

On August 25, 2011, the U.S. Department of Transportation’s (“DOT”) Pipeline and Hazardous Materials Safety Administration (“PHMSA”) announced that it was seeking information concerning contemplated changes in natural gas transportation safety regulations. (1)  This advanced notice of proposed rulemaking (“ANPRM”) follows another one published by PHMSA involving hazardous liquid pipelines. See, 75 Fed. Reg. 63774 (Oct. 18, 2010). Draft rules have not yet been proposed in response to that initiative. In this initiative, PHMSA requests comments on considerations to greatly expand both the reach and the regulatory requirements for gas pipelines.


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By Maureen N. Harbourt

On September 2, 2011, President Obama announced that he had requested the Environmental Protection Agency to withdraw the proposed revision to the primary National Ambient Air Quality Standard for ozone at this time. A White House press release quoted the President as stating:

“I have continued to underscore the importance of reducing regulatory burdens and regulatory uncertainty, particularly as our economy continues to recover. With that in mind, and after careful consideration, I have requested that Administrator Jackson withdraw the draft Ozone National Ambient Air Quality Standards at this time. Work is already underway to update a 2006 review of the science that will result in the reconsideration of the ozone standard in 2013.” 1

The request was delivered to EPA Administrator Lisa Jackson via a letter from Cass Sunstein, Director of the Office of Management and Budget. The letter stated that the decision was based on the President’s Executive Order 13563, which emphasizes that “Our regulatory system must protect public health, welfare, safety, and our environment while promoting economic growth, innovation, competitiveness, and job creation.” The letter from OMB indicated that EPA was already in the process of reviewing the ozone standard again based upon the most recent science and is required to complete that review by 2013. It urged EPA to complete that process. However, OMB indicated that the President requested that EPA “reconsider” its proposed rule in light of the directives of the Executive Order, in particular, to “promote predictability and reduce uncertainty.” The OMB letter flatly stated that President Obama did not support EPA’s proposed rule and that regulatory agencies should take action consistent with the President’s priorities. 2


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By Tokesha M. Collins

On July 28, 2011, the Louisiana Department of Environmental Quality (LDEQ) denied a petition for the adoption of a rule to regulate fossil fuel carbon dioxide (CO2) emissions and to establish an effective emissions reduction strategy that will achieve a concentration of 350 parts per million (ppm) atmospheric CO2 by the year 2100. The petition was filed on May 4, 2011, by Kezia Kamenetz, of New Orleans, and Kids vs Global Warming, a non-profit organization formed in Oak View, California.


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By Brittany L. Buckley

The recent development of the Haynesville Shale in North Louisiana and other shale formations around the country has generated huge public interest in the hydraulic fracturing process, which is known as “fracking” in the oil and gas industry. Fracking refers to the procedure of injecting fluid into tight shale or sandstone

By R. Lee Vail and Maureen N. Harbourt

On July 15, 2011, the House of Representative, Committee on Energy and Power, Subcommittee on Energy and Commerce held hearings on a draft of the “Pipeline Infrastructure and Community Protection Act of 2011.”  Chairman Fred Upton’s initial comments focused on recent pipeline incidents: the 20,000 barrel oil

By Maureen Harbourt

As of July 3, 2011, the air quality measured at the official ozone monitor at 1425 Airport Drive, which is within Shreveport, but located in Bossier Parish, indicated that the design value for the parish is now 76.7 parts per billion (ppb) which exceeds the 75 ppb standard set by EPA in 2008. 40 C.F.R. §50.15. The design value for each monitor is the 3 year average of the 4th highest ozone reading at that monitor each year. The exceedance of the current standard will likely cause the Louisiana Department of Environmental Quality (LDEQ) to propose that EPA designate Bossier Parish, and perhaps Caddo and DeSoto Parishes, as an ozone nonattainment area.

LDEQ was required to submit its recommendation for nonattainment designations under the 2008 ozone standard by March 12, 2009. EPA was then required to act on the proposals and make final designations no later than March 12, 2010. 73 Fed. Reg. 16436, 16503 (Mar. 27, 2008). In its 2009 recommendation, LDEQ did designate Caddo, but not Bossier or DeSoto, parishes as nonattainment. (1) However, when air quality in Caddo parish improved to compliance status over the past several years, LDEQ amended that recommendation in January 2010 to classify Caddo as attainment. (2)


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By R. Lee Vail

In response to the Gulf of Mexico Deepwater Horizon Incident, the Louisiana Department of Natural Resources (“DNR”), Office of Conservation (“Conservation”) issued a series of emergency rules with effective dates: July 15, 2010(1) , December 9, 2010(2), January 12, 2011(3) and most recently May 12, 2011(4).  

By R. Lee Vail

Deepwater oil and gas production from the Gulf of Mexico has become a significant portion of the current production within the United States, equal to over 1.6 million barrels per day of oil equivalent; total U.S oil production is around 5.3 million barrels per day. (1)  Worldwide shallow water oil production peaked around the year 2000 whereas worldwide deep water production has risen to around 5 million barrels per day. On May 10, 2011, the Bureau of Ocean Energy Management, Regulation and Enforcement (“BOEMRE”) approved Royal Dutch Shell’s Exploration Plan S-0744 to better define discoveries announced in 2009 and 2010. (2) 

Several environmental groups filed suit in an attempt to block the approved plan. Gulf Restoration Network, Inc., Florida Wildlife Federation, and Sierra Club Inc. filed a petition on June 8, 2011, in the United States Court of Appeals, 11th Circuit, in an attempt to set aside BOEMRE’s approval of the plan. The allegations in the petition are relatively general, alleging violation of the National Environmental Policy Act (“NEPA”) (i.e., for BOEMRE’s alleged failure to appropriately conduct the required environmental assessments and/or impact statements) and further alleging elements required pursuant to 43 U.S.C §1349(c) necessary to maintain the suit under the Outer Continental Shelf Lands Act (“OCSLA”).
 


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