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Briefs -- BLM Fines, Black Elk Energy, California Fire Risk, SEC Disclosure Rules

The U.S. Interior Department's Bureau of Land Management (BLM) on Monday released a congressionally mandated increase in civil penalties for oil/natural gas operators violating regulations on federal and Indian onshore lands. The inflation-adjustment increases are effective Aug. 1 under the Federal Civil Penalties Inflation Adjustment Improvements Act passed last year. The increases, which BLM officials called small relative to the overall value of annual production on all federal and Indian oil/gas leases, are aimed at maintaining "the deterrent effect of civil penalties," and are calculated based on the percentage change in the consumer price index for all urban consumers since October 1987, the year the penalties were established. BLM does not see any undue economic impact on the industry from the larger penalties because it said individuals and companies can avoid the increased fines by complying with applicable oil/gas regulations. Only the civil penalties covered in the 2015 law apply to oil/gas operators, BLM officials said.

A confidential settlement was reached Monday in a New Orleans court in a trial that combined 10 lawsuits related to an explosion and fire of an offshore oil platform in the Gulf of Mexico in November 2012 (see Daily GPIApril 18Nov. 19, 2012). The incident on a platform owned by Black Elk Energy LLC of Houston killed three workers and injured others. Parties to the case included Black Elk, contractors, injured workers and relatives of those killed. A jury that had been seated for a trial in the case was dismissed. A related criminal case is scheduled for trial in January.

As a hedge against what state officials fear could be one of the worst wildfire seasons ever, San Francisco-based Pacific Gas and Electric Co. (PG&E) on Monday began daily aerial patrols to help spot and respond to wildfires that could affect its tens of thousands of miles of natural gas and electric infrastructure covering much of the northern half of California. The patrols will continue through October, focused on utility infrastructure traversing parts of the Sierra Nevada Mountains in north and central regions of the state, along with Mendocino County and along the historic redwood and central coasts. Patrols will be flown seven days a week from mid-afternoon until dusk. During heightened wildfire red flag days, PG&E will conduct special on-the-ground vegetation management patrols and added aerial surveillance in the designated red flag areas.

The U.S. Securities and Exchange Commission has adopted rules to require operators to disclose payments they make to foreign governments to commercially develop oil, natural gas or minerals. The rules are mandated by the Dodd-Frank Wall Street Reform and Consumer Protection Act. Under the final rules, information must be disclosed regarding fees that total more than $100,000 during a single fiscal year for taxes, royalties and other types of payments to further oil, gas or minerals exploration, extraction, processing and export, or when a license is acquired for any such activity.

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