Hearings This Week

House Science, Space and Technology, Subcommittee on Environment hearing on “Expanding the Role of States in EPA Rulemaking.”

Date: Tuesday, May 23, 10 a.m.
Place: 2318 Rayburn Bldg.
Witnesses :
Misael Cabrera, director of the Arizona Department of Environmental Quality
Deborah Swackhamer, professor emerita with the Hubert H. Humphrey School of Public Affairs and professor emerita in environmental health sciences at University of Minnesota
Becky Keogh, director of the Arkansas Department of Environmental Quality

Senate Environment and Public Works, Subcommittee on Clean Air and Nuclear Safety hearing on S.263, the “Ozone Standards Implementation Act of 2017”; and S.452, the “Ozone Regulatory Delay and Extension of Assessment Length (ORDEAL) Act of 2017.”

Date: Tuesday, May 23, 2:30 p.m.
Place: 406 Dirksen Bldg.
Agenda and Witnesses
S 263 — Ozone Standards Implementation Act
S 452 — Ozone Regulatory Delay and Extension of Assessment Length (ORDEAL) Act
Witnesses: TBA

House Natural Resources, Subcommittee on Oversight and Investigations hearing on “Examining Impacts of Federal Natural Resources Laws Gone Astray.”
Date: Wednesday, May 24, 9 a.m.
Place: 1324 Longworth Bldg.
Witnesses:TBA

Senate Armed Services Subcommittee on Strategic Forces hearing on “Department of Energy Atomic Energy Defense Activities and Programs.”

Date: Wednesday, May 24, 2:30 p.m.
Place: G50 Dirksen Bldg.
Witnesses
Acting Assistant Energy Secretary for Environmental Management Susan Cange
Navy Adm. James Caldwell Jr., deputy administrator for naval reactors at the National Nuclear Security Administration
David Trimble, director of natural resources and environment at the Government Accountability Office

Senate Energy and Natural Resources Committee hearing on the nomination of Dan Brouillette to be deputy Energy secretary; Neil Chatterjee to be a member of the Federal Energy Regulatory Commission; and Robert Powelson to be a member of the Federal Energy Regulatory Commission.

Date: Thursday, May 25, 10 a.m.
Place: 366 Dirksen Bldg.
Witnesses: The nominees testify

 

Domestic Shale Production: Good for America/Bad for OPEC

There are lots of reasons to be happy about strong America’s shale resources, but here’s one more – it’s putting a hurting on OPEC!   According to U.S. Energy Information Administration (EIA) estimates, in 2016, “members of the Organization of the Petroleum Exporting Countries (OPEC) earned about $433 billion in net oil export revenues (unadjusted for inflation). This represents a 15% decline from the $509 billion earned in 2015, mainly as a result of the fall in average annual crude oil prices during the year, and to a lesser extent to decreases in the level of OPEC net oil exports. This revenue total was the lowest earnings for OPEC since 2004.”

 

Energy Related Hearings This Week

House Foreign Affairs — Subcommittee on Western Hemisphere hearing on “Energy Opportunities in South America.”
Date: Wednesday, May 17, 10 a.m.
Place: 2172 Rayburn Bldg.
Witnesses:
Jorge Pinon, director of the Latin America and Caribbean Program in the University of Texas at Austin’s Jackson School of Geosciences
Lisa Viscidi, director of Inter-American Dialogue’s Energy, Climate Change, and Extractive Industries Program
Jason Bordoff, professor and director of Columbia University’s Center on Global Energy Policy, School of International and Public Affairs

Senate Energy and Natural Resources Committee hearing on the nomination of David Bernhardt to be deputy Interior secretary.
Date: Thursday, May 18, 10 a.m.
Place: 366 Dirksen Bldg.
Witnesses: The nominee testifies

 

Environmental Organization Challenges Constitutionality of the Congressional Review Act

As we previously reported on this blog, Congress and the Trump administration have revived the Congressional Review Act (CRA) and set about rescinding a series of regulations promulgated during the Obama presidency.  Congress’ authority to invalidate an executive agency rule is rooted in Article I of the Constitution, which vests “[a]ll legislative Powers [t]herein granted” in Congress.  While Congress has delegated rule-making or quasi-lawmaking authority to executive agencies, Congress ultimately retains all legislative power, and thus any power delegated to the executive by Congress can later be restricted or withdrawn.

But according to a new lawsuit filed by the Center for Biological Diversity, the CRA amounts to congressional invasion of executive branch authority.   At issue in Center for Biological Diversity v. Zinke, Case No. 3:17-cv-00091-JWS (D. Alaska Apr. 20, 2017), is Public Law No. 115-20, which invalidated a rule adopted by the Interior Department near the end of President Obama’s second term. See Non-Subsistence Take of Wildlife, and Public Participation and Closure Procedures, on National Wildlife Refuges in Alaska,” 81 Fed. Reg. 52,248 (2016). The rule prohibited certain methods of predator control within Alaska’s national wildlife refuges.

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Hearings This Week

The House is not in session the week of May 8.

Senate Environment and Public Works Committee hearing on “Conservation, Consultation, and Capacity: State Views on the Need to Modernize the Endangered Species Act.”
Date: Wednesday, May 10, 10 a.m.
Place: 406 Dirksen Bldg.
Witnesses: TBA

Pending Legislation
Senate Energy and Natural Resources — Subcommittee on Water and Power hearing on several bills, including:  S.440, to establish a procedure for the conveyance of certain federal property around the Dickinson Reservoir in the State of North Dakota; S.677, the “Water Supply Permitting Coordination Act”; S.685, the “Clean Water for Rural Communities”; S.930, the “Western Area Power Administration Transparency Act”; S.1012, the “New Mexico Drought Preparedness Act”; S.1029, to amend the Public Utility Regulatory Policies Act of 1978 to exempt certain small hydroelectric power projects that are applying for relicensing under the Federal Power Act from the licensing requirements of that Act; and S.1030, to require the Federal Energy Regulatory Commission to submit to Congress a report on certain hydropower projects.
Date: Wednesday, May 10, 2:30 p.m.
Place: 366 Dirksen Bldg.
Agenda and Witnesses
S 930 — Western Area Power Administration Transparency Act
S 685 — A bill to authorize the Dry-Redwater Regional Water Authority System and the Musselshell-Judith Rural Water System in the States of Montana and North Dakota, and for other purposes.
S 440 — A bill to establish a procedure for the conveyance of certain Federal property around the Dickinson Reservoir in the State of North Dakota.
S 1012 — A bill to provide for drought preparedness measures in the State of New Mexico, and for other purposes.
S 677 — A bill to authorize the Secretary of the Interior to coordinate Federal and State permitting processes related to the construction of new surface water storage projects on lands under the jurisdiction of the Secretary of the Interior and the Secretary of Agriculture and to designate the Bureau of Reclamation as the lead agency for permit processing, and for other purposes.
S 1029 — A bill to amend the Public Utility Regulatory Policies Act of 1978 to exempt certain small hydroelectric power projects that are applying for relicensing under the Federal Power Act from the licensing requirements of that Act.
S 1030 — A bill to require the Federal Energy Regulatory Commission to submit to Congress a report on certain hydropower projects.
Witnesses: TBA

 

Energy-Related Hearings This Week

Senate Energy and Natural Resources Committee hearing on federal payments to local governments provided through the Secure Rural Schools and Community Self Determination Act and the Payment in Lieu of Taxes program and the need to provide greater fiscal certainty for resource-dependent communities with tax-exempt federal lands.

Date:    Tuesday, May 2, 10 a.m.
Place:   366 Dirksen Bldg.

Witnesses:
Olivia Barton Ferriter, Deputy Assistant Interior Secretary for Budget, Finance, Performance, and Acquisition
Glenn Casamassa, associate deputy chief of the U.S. Forest Service
Ketchikan Gateway Borough, Alaska, Mayor David Landis
Valley County, Idaho, Commission Chairman Gordon Cruickshank
Pend Oreille County, Wash,, County Commissioner Mike Manus
Mark Haggerty of Headwaters Economics
Mark Whitney, president of Utah’s Association of Counties in the National Association of Counties

House Natural Resources — Subcommittee on Federal Lands hearing on the “Consequences of Executive Branch Overreach of the Antiquities Act.”

Date:    Tuesday, May 2, 10 a.m.
Place:  1324 Longworth Bldg.
Witnesses:    TBA

Senate Environment and Public Works Committee hearing on “Infrastructure Project Streamlining and Efficiency: Achieving Faster, Better, and Cheaper Results.”

Date:    Wednesday, May 3, 10 a.m.
Place:   406 Dirksen Bldg.
Witnesses:   TBA

House Energy and Commerce — Subcommittee on Energy hearing on the “Promoting Hydropower Development at Existing Non-Powered Dams Act”; the “Promoting Closed-Loop Pumped Storage Hydropower Act”; the “Promoting Small Conduit Hydropower Facilities Act of 2017”; the “Promoting Interagency Coordination for Review of Natural Gas Pipelines Act”; the “Promoting Cross-Border Energy Infrastructure Act”; H.R.1538, the “Supporting Home Owner Rights Enforcement Act”; H.R.446, to extend the deadline for commencement of construction of a hydroelectric project; H.R.447, to extend the deadline for commencement of construction of a hydroelectric project; H.R.2122, to reinstate and extend the deadline for commencement of construction of a hydroelectric project; and the “Hydropower Policy Modernization Act of 2017.”

Date:    Wednesday, May 3, 10 a.m.
Place:   2123 Rayburn Bldg.

Agenda:
HR 2122 — A bill to reinstate and extend the deadline for commencement of construction of a hydroelectric project involving Jennings Randolph Dam.
HR 1538 — Supporting Home Owner Rights Enforcement Act
HR 446 — A bill to extend the deadline for commencement of construction of a hydroelectric project.
HR 447 — A bill to extend the deadline for commencement of construction of a hydroelectric project.
HR —   the “Promoting Interagency Coordination for Review of Natural Gas Pipelines Act”;
HR  — the “Promoting Cross-Border Energy Infrastructure Act”;

House Science, Space and Technology — Subcommittee on Energy hearing on “Oil and Gas Technology Innovation.”

Date:   Wednesday, May 3, 10 a.m.
Place:   2318 Rayburn Bldg.

Witnesses:

Edward Johnston, senior vice president for research and development at the Gas Technology Institute
David Brower, founder and president of Astro Technology
Walker Dimmig, principal of 8 Rivers Capital, LLC
Ramanan Krishnamoorti, interim vice president and interim vice chancellor for research and technology transfer in the University of Houston & University of Houston System and chief energy officer for the University of Houston

House Transportation and Infrastructure — Subcommittee on Coast Guard and Maritime Transportation hearing on “Maritime Transportation Regulatory Issues.”

Date:    Wednesday, May 3, 10 a.m.
Place:   2167 Rayburn Bldg.

Witnesses:
Rear Adm. Paul Thomas, assistant commandant for prevention policy for the Coast Guard
Michael Khouri, acting chairman of the Federal Maritime Commission
Todd Schauer, president of the American Salvage Association
Steven Candito, board member, former president and CEO of the National Response Corporation
Nicholas Nedeau, CEO of Rapid Ocean Response Corporation
Norman Custard, president and CEO of Alaska Maritime Prevention and Response Network
Thomas Allegretti, president and CEO of American Waterways Operators
Peter Ford, chief strategy officer for Ports America
John Butler, president and CEO of the World Shipping Council

 

House Natural Resources — Subcommittee on Water, Power and Oceans hearing on “The Challenges of Keeping Hydropower Affordable and Opportunities for New Development.”

Date:   Wednesday, May 3, 2:30 p.m.
Place:   1324 Longworth Bldg.
Witnesses:        TBA

Senate Energy and Natural Resources Committee hearing on the threat posed by electromagnetic pulse and policy options to protect energy infrastructure and to improve capabilities for adequate system restoration.

Date:    Thursday, May 4, 10 a.m.
Place:   366 Dirksen Bldg.
Witnesses:  TBA

EIA: Permian Basin Oil Production and Resource Assessments Continue to Increase

According to the U.S. Energy Information Administration, “Crude oil production in the Permian Basin is expected to increase to an estimated 2.4 million barrels per day (b/d) in May, based on estimates from EIA’s Drilling Productivity Report. Between January 2016 and March 2017, oil production in the Permian Basin increased in all but three months, even as domestic crude oil prices fell. As production in other regions fell throughout most of 2015 and 2016, the Permian provided a growing share of U.S. crude oil production. With rising oil prices over the past year, the Permian continues to be attractive to drillers, as reflected in rising rig counts. As of April 21, 2017, the number of rigs in the Permian Basin reached 340, or 40% of the 857 total oil- and natural gas-directed rigs operating in the United States. The Permian rig count reached as high as 568 in late 2014 before falling to a low of 134 in spring 2016.”

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Federal Court Defers to Oklahoma Oil and Gas Oversight, Rejects Sierra Club Bid for Federal Regulation

This post was originally posted on WLF Legal Pulse.

In 2016, the Sierra Club filed suit in Oklahoma alleging that use of state-permitted deep wastewater injection wells was causing increased seismic activity—both in frequency and severity.  Sierra Club v. Chesapeake Operating, LLC, et al., Case No. CIV-16-134-F, United States District Court for the Western District of Oklahoma.

In an April 4, 2017 Order the court dismissed the case, declining to exercise jurisdiction because doing so would interfere with the state regulators’ efforts to address the alleged increased seismic activity from wastewater injection.

For decades, wastewater injection wells have been used to safely dispose of water that is a common byproduct of oil and gas extraction.  The disposal wells are drilled and completed to protect drinking water.  The geological formations into which the wastewater is injected are thousands of feet below fresh water formations to prevent contamination of drinking water.  Without such disposal wells, oil and gas production in Oklahoma would become prohibitively expensive.

In 1981, pursuant to authority under the federal Safe Drinking Water Act, EPA granted primary jurisdiction to regulate wastewater disposal wells in Oklahoma to the Oklahoma Corporation Commission (OCC), the state agency with regulatory authority over oil and gas activity in Oklahoma.

The Sierra Club specifically alleged that the injection of wastewater produced during oil and gas extraction had caused a 300-fold increase in earthquakes from 2009 to 2015, and a 50-fold increase in the number of 3.5 scale earthquakes.  It further alleged that Oklahoma now has the highest risk of earthquakes in the nation, and that the earthquakes caused by wastewater injection created an imminent and substantial danger to the environment, infrastructure, public health, and safety.

Alleging violations of the federal Resource Conservation and Recovery Act (RCRA), the Sierra Club asked the court to remedy the alleged earthquake risk by ordering the defendants to (i) immediately and substantially reduce the volume of wastewater injections, (ii) pay for reinforcement of vulnerable structures, and (iii) establish an earthquake monitoring and prediction center to study and determine the volumes of wastewater that can be safely injected without inducing seismic activity.

The court acknowledged that RCRA allows a private party to bring suit against any person or entity that handles, stores, treats, or disposes of wastewater in a manner presenting an imminent and substantial endangerment to public health or the environment.  Nonetheless, the court concluded that dismissal was appropriate under the related doctrines of Abstention and Primary Jurisdiction.

The Abstention Doctrine allows a federal court to decline to hear a case that would disrupt state efforts to establish a uniform policy dealing with a matter of great public concern, especially when the state is actively addressing the concerns.  The Primary Jurisdiction Doctrine is intended to promote the proper separation between courts and specialized regulatory agencies, protecting the function of agencies that possess particularized expertise and are charged with ensuring uniformity of regulatory outcomes.

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Hearings This Week

 

Senate Environment and Public Works Committee hearing on “A Review of the Technical, Scientific, and Legal Basis of the WOTUS (Waters of the United States) Rule.”
Wednesday, April 26, 10 a.m.
406 Dirksen Bldg.

 

House Transportation and Infrastructure — Subcommittee on Railroads, Pipelines and Hazardous Materials hearing on “Building a 21st Century Infrastructure for America: The State of Railroad, Pipeline, and Hazardous Materials Safety Regulations and Opportunities for Reform.”
Wednesday, April 26, 10 a.m.
2167 Rayburn Bldg. Witnesses
Linda Darr, president of the American Short Line and Regional Railroad Association

Roger Nober, executive vice president of law and corporate affairs at BNSF Railway

Paul Rankin, president of the Reusable Industrial Packaging Association

Robin Rorick, group director of midstream and industry operations at the American Petroleum Institute

Donald Santa Jr., president and CEO of the Interstate Natural Gas Association of America

John Tolman, vice president and national legislative representative for the Brotherhood of Locomotive Engineers and Trainmen

 

House Energy and Commerce Committee hearing on the Nuclear Waste Policy Amendments Act of 2017.
Wednesday, April 26, 10 a.m.
2123 Rayburn Bldg.

Burdens and Regulations Under Review at EPA

The internal memorandum from Administrator Pruitt to his senior staff at the U.S. Environmental Protection Agency (“EPA”) was recently released to the press.  The memo provides the road map for implementing Executive Order 13777, which directs agencies to take steps to repeal, replace, or modify unduly burdensome regulations.  To identify the regulations EPA will prioritize in the coming months and years, Administrator Pruitt created a Regulatory Review Task Force consisting of four top EPA appointees.  The Task Force is directed to develop the recommendations by seeking out input from regulated entities and the trade associations representing the regulated community.   The memo further directs the Task Force to conduct “some general outreach” and to host public stakeholder meetings and to screen and compile the responses by May 15, 2017.

Subsequent to Administrator Pruitt’s memorandum, EPA announced on its website that the Agency would convene a “Stakeholder Meeting” in Washington, D.C. on April 25, 2017, during which regulated entities and their representatives could testify on environmental regulatory burdens and EPA rules that should be repealed, replaced, or modified. Interested stakeholders should confirm their attendance with EPA by April 17, 2017.

In addition to, or in lieu of, testifying at the April 25th Stakeholder Meeting, regulated entities can also submit written comments on the regulatory burdens facing their industry/company and make recommendations for modification or repeal.   EPA opened a docket on regulations.gov and will accept comments until May 15, 2017.

While we cannot speculate on the likelihood that EPA will adopt any or all of the recommendations it receives, we note that this Administration has been aggressively touting its deregulatory approach and is taking concrete steps to better understand environmental regulatory burdens. For those who bemoaned the prior administration’s “regulatory onslaught” – this is your chance to ask for a change.  Stakeholders should use this process to reach out to EPA, provide their recommendations in a clear and succinct manner, and make themselves available for the public hearings and potentially other meetings.  Kelley Drye’s Environmental and Government relations practice groups are well equipped to help.

This is an Administration that operates far differently than previous administrations, and the regulated community need to be prepared for a different type of dialogue with EPA and other federal agencies.  Stakeholders who clearly articulate their regulatory concerns and proposed remedies to EPA will stand a better chance of seeing those concerns addressed.  Those entities that do not clearly identify their issues with EPA are not likely to see those issues addressed.

Click here to view the Pruitt memorandum.  If you have any questions or would like to discuss potential approaches, please contact Wayne D’Angelo at wdangelo@kelleydrye.com or (202) 342-8525.

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