Bipartisan legislation (HR 1900) introduced by U.S. Rep. Mike Pompeo (R-KS) seeks to bring more certainty to the interstate natural gas pipeline permitting process, giving federal agencies up to 90 days after the Federal Energy Regulatory Commission issues a certificate (one-time 30-day extension for unforeseen circumstances) to complete their work. The time line would apply to any federal agency charged with issuing a permit for an interstate gas project, including the Interior Department‘s Bureau of Land Management (right-of-way grant) and U.S. Fish and Wildlife Service (Endangered Species Act; the U.S. Army Corps of Engineers (Clean Water Act); and the Environmental Protection Agency (emissions permit). Pipeline projects require as many as 10 permits. The time limit would codify existing regulations following the Energy Policy Act of 2005 (EPAct), which were intended to expedite projects. A study this year by the Interstate Natural Gas Association of America found that the percentage of federal authorizations for interstate pipes that were issued more than 90 days beyond FERC’s issuing environmental impact statements (EIS) or environmental assessments (EA) rose from 7.69% before EPAct became law to 28.05% after implementation (see NGI, Jan. 21). Federal authorizations granted 180 days or longer after FERC issued an EIS or EA rose from 3.42% to 19.51%. Cosponsors of the legislation are Reps. Jim Matheson (D-UT), Pete Olson (R-TX), Cory Gardner (R-CO) and Bill Johnson (R-OH).

In what is believed to be a first in the industry, the elected Mora County Commission in New Mexico has voted 2-1 to totally ban oil and natural gas drilling. Mora County is in the Tucumcari Basin. The Mora County Community Water Rights and Local Self-Government Ordinance was enacted April 29. Wally Drangmeister, spokesman for the New Mexico Oil and Gas Association (NMOGA), said the ban may be the first of its kind. According to 2010 U.S. Census Bureau data, Mora County’s population is about 4,881, with 16.3% of the population living below the poverty level from 2007 to 2011, which is lower than 19% statewide. The New Mexico Department of Workforce Solutions reported in March that Mora County had the second-highest unemployment rate in the state at 14.4%; only Luna County was higher at 20.5%. Commissioners in neighboring San Miguel County are also considering an oil and gas ordinance.

Shell NA LNG LLC and BP Energy Co. have protested Dominion Cove Point’s (DCP) proposal to build liquefied natural gas (LNG) export facilities near the Lusby, MD, import terminal because they claim it may degrade services to existing importers and offers preferential treatment to some customers. The Shell Oil Co. affiliate, a major import customer, said, “Cove Point repeatedly states…that the export project will not degrade its existing services,” that existing customers won’t subsidize the project and that it will honor service agreements, but the statements “are couched in very general terms. Without more details and further explanation, it is difficult, if not impossible, for Shell LNG to determine the impact of the export project…” In the BP plc affiliate’s protest, the Federal Energy Regulatory Commission was urged to “rectify consequences of unduly preferential conduct” by DCP when it allegedly provided existing import customer Statoil ASA an opportunity to “turn back” its import expansion storage and regasification capacity, while denying BP, also an importer, the same opportunity. The Dominion unit wants to build a $3.4-3.8 billion export project and associated interstate gas pipeline facilities [CP13-113].

MarkWest Energy Partners LP agreed to pay Chesapeake Energy Corp. $245 million cash for Anadarko Basin midstream assets, which include the 200 MMcf/d cryogenic gas processing facility Buffalo Creek Plant now under construction, 22 miles of gas gathering pipeline in Hemphill County, TX, and 30 miles of rights-of-way associated with the future construction of a high-pressure trunk line. An amine treating facility and a five-mile-long gas gathering pipeline in Washita County, OK, also were part of the deal. In addition, long-term, fee-based midstream agreements were executed with Chesapeake, which is dedicating about 130,000 acres across the basin. Initial gas volumes from Chesapeake are estimated at 50 MMcf/d, increasing to more than 250 MMcf/d by 2017.

The Pennsylvania Public Utility Commission (PUC) approved a settlement with UGI Utilities Inc. that includes a $200,000 civil penalty, following a PUC investigation into an Oct. 31, 2011 natural gas explosion in Millersville, PA, that caused about $455,000 in damages to a home and a business. Commissioners voted unanimously to approve the settlement, which, in addition to the civil penalty, included changes to UGI’s practices and procedures “to ensure that work crews were retrained regarding emergency protocol and receive additional education on excavation,” the PUC said. The settlement calls on Reading, PA-based UGI to make a number of internal changes, including enhancing its internal line location screening system, reclassifying certain valves when they are reconnected to the distribution system, and auditing certain valves to make sure they are properly classified. The explosion was caused when a third-party contractor digging in Millersville struck and ruptured a UGI gas main, according to a complaint filed by the PUC’s independent Bureau of Investigation and Enforcement. The PUC said UGI failed to properly mark its underground facilities and failed to have procedures in place to locate lines in certain circumstances.

The Department of Interior‘s Bureau of Safety and Environmental Enforcement (BSEE) and the U.S. Coast Guard (USCG) have a memorandum of agreement (MOA) in place to bolsters their joint management of safety and environmental protection on the Outer Continental Shelf (OCS). The MOA, signed on April 30, ensures that they take a “comprehensive, joint approach;” it was implemented as part of a less-broad 2012 memorandum of understanding. The MOA alleviates any ambiguity as to who is to do what, calling on the agencies to identify a coordinator to identify areas that may require joint policy or guidance. The agreement also calls for the two agencies to review and discuss all OCS-related regulatory projects related to safety management and to share information involving their efforts.

Alaska received nearly $4.5 million in high bids for its latest oil and gas lease sale in Cook Inlet, the third largest of its kind in nominal dollars and the sixth largest in acreage leased since the program began in 1999, officials said. Cook Inlet has seen an increase in investment from a variety of operators, according to the Alaska Department of Natural Resources. In the sale, 32 bids were received from seven bidding groups on 28 tracts, encompassing 145,739 acres. Bidders included Hilcorp Alaska, Cook Inlet Energy, and NordAq Energy. Hilcorp was the most active bidder, winning 19 of the 28 tracts.

Delaware’s Court of Chancery refused to block the $6.9 billion merger of Plains Exploration & Production Co. with Freeport-McMoRan Copper & Gold Inc., clearing the way for Plains shareholders to vote on the proposal May 20. In a friendly deal, Freeport in December offered an estimated $9 billion in cash and stock to buy Plains and McMoRan Exploration Co. (see NGI, Dec. 10, 2012). Freeport agreed to pay $6.9 billion for Plains and $3.4 billion ($2.1 billion net) for McMoRan. Freeport Chairman Jim Bob Moffatt co-chairs McMoRan with Freeport CEO Richard Adkerson. Plains holds a 31.5% stake in McMoRan. Dissident Plains shareholders sought a preliminary injunction to prevent the buyout from proceeding. The court said the plaintiffs had “not established a reasonable probability of success on the merits” that the board had breached its fiduciary duties (In re Plains Exploration & Production Co. Stockholder Litigation, No. 8090-VCN).

The U.S. District Court for the Southern District of New York has ruled in favor of Chesapeake Energy Corp. in a $1.3 billion bond redemption dispute with the Bank of New York Mellon Trust Co. NA, a ruling that may allow the company to save more than $100 million in interest payments. Chesapeake had asked for the right to redeem the 6.775% senior notes due in 2019 as part of a broader refinancing of its outstanding debt obligations. The company plans to proceed with the redemption even if there is an appeal.

The Millennium Pipeline Co. is holding a nonbinding open season through May 31 for firm transportation service under its existing rate schedule FT-1 to be made available with existing capacity and construction of at least one compressor station and 60 miles of new pipeline that would connect to the Dominion Transmission system near Cortland, NY, and the Tennessee Gas Pipeline System near Syracuse, NY. For information, contact Stan Brownell,

The Susquehanna River Basin Commission (SRBC) announced the start of a multi-year effort to study water quantity, but rebuffed calls for it to be expanded to a comprehensive environmental study that could include the impacts of hydraulic fracturing in the basin. SRBC Executive Director Paul Swartz said he believes expanding the scope of the water quantity study “does the public a disservice,” and said the study would instead focus on the cumulative impact of consumptive water use and its availability. The water quantity study is expected to be completed by 2015.

Sunoco Logistics Partners LP has received enough binding commitments to enable its Mariner South Pipeline project to proceed. Mariner South will transport export-grade propane and butane from Lone Star NGL LLC‘s storage and fractionation complex in Mont Belvieu, TX, to Sunoco Logistics’ terminal in Nederland, TX. A binding open season continues to solicit additional business. In addition to propane and butane, the pipeline will be available for other natural gas liquids and petroleum products depending on shipper interest, Sunoco Logistics said. It is expected to have initial capacity of 200,000 b/d with the potential for expansion. Operation is expected during the first quarter of 2015.

The Pennsylvania Public Utility Commission (PUC) has asked about 70 municipalities to correct and resubmit a form showing how their share of impact fee revenue under Act 13 from the Marcellus Shale was spent. A PUC spokeswoman said the agency was in contact with municipalities that had incorrectly information on forms for the 2012 tax year. The PUC also was waiting for forms from about 300 municipalities; the forms were due April 15. Act 13 empowers the PUC to collect an impact fee on natural gas production on behalf of local governments (see NGI, Feb. 20, 2012).

Texas House lawmakers have passed HB 2767 that is intended to encourage oil and gas operators to conserve and recycle as much as possible the water they use in the energy patch. An analysis of the bill, filed by Rep. Phil King (R-Weatherford), said “rapid growth of development” of shale plays in the state has required large quantities of water for hydraulic fracturing and other development activities. “Under current practice, most oil and gas wastewater is disposed of in underground injection wells instead of being treated and reused in drilling and hydro-fracturing activity, according to concerned parties.” The legislation would encourage waste recycling by streamlining what is viewed as a lengthy permitting process for off-lease wastewater treatment operations. It also seeks to clear up legal ambiguities surrounding the ownership of waste that is transferred to another party for treatment. The bill also would require the Railroad Commission of Texas to govern the treatment and beneficial use of oil and gas waste.

Voters in the Youngstown, OH, defeated an amendment to the city’s charter that would have banned hydraulic fracturing (fracking). According to unofficial results from the Mahoning County Board of Elections, amendment opponents prevailed by a vote of 3,821 to 2,880, or by a 57-43% margin. The amendment, dubbed the “Youngstown Community Bill of Rights,” called for a ban on fracking but also would have prohibited pipelines, processing facilities, compressors and storage and transportation facilities.

Chevron Corp. is acquiring acreage in Moon Township, PA, in the Pittsburgh area for a potential regional headquarters. No terms were revealed. Chevron had “the opportunity to acquire this land, which provides us with a potential location as we continue to evaluate our options for a regional headquarters facility,” said Bruce Niemeyer, vice president of the Appalachian/Michigan business unit. Chevron employs about 650 people in Pennsylvania, with about 400 in Moon Township. The announcement makes Chevron the first oil major to build a campus in the Pittsburgh area.

Crowley Maritime Corp.‘s petroleum services group is acquiring Carib Energy LLC, the first company to receive a small-scale, 25-year, liquefied natural gas export license from the U.S. Department of Transportation to ship gas into free trade agreement countries (see NGI, Aug. 8, 2011). A Crowley LNG services group has been formed within its petroleum services business unit. The acquisition of Carib, which is to become a subsidiary, provides Crowley an immediate book of business to supply, transport and distribute LNG via 10,000 gallon ISO tanks.

Legislation to extend tax credits that support converting conventional vehicles to run on “cleaner” fuels, such as natural gas, was awaiting Oklahoma Gov. Mary Fallin‘s signature. The incentive, which covers about half the cost of converting a typical vehicle and three-quarters of the cost of establishing an alternative fueling station, will be extended until 2020. The incentives are expected to cost the state — a major natural gas producer — $1.5-2 million per year.

Singapore has received its first commercial delivery of liquefied natural gas (LNG) on Jurong Island from BG Group plc, joining the ranks of global importers. BG has a license to import and sell up to 3 million tonnes per annum (mtpa); supplies are sourced from Australia. The terminal has initial throughput capacity of 3.5 mtpa, which is set to increase to 6 mtpa by the end of 2013.

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