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Lenape Resources Inc., an oil and natural gas producer based in New York, has filed a lawsuit against a town in Livingston County for enacting a local drilling ban, and against the state Department of Environmental Conservation (DEC) for failing to rein in the town over the ban.

With natural gas-fired power generation plants and refineries both in the crosshairs of state regulators, California held its first auction for carbon emissions trading on Thursday, despite the state’s major business association filing a lawsuit to block the auction a day earlier.

Spectra Energy Corp. is taking a one-third interest in the Sand Hills and Southern Hills pipelines, both of which are under construction by DCP Midstream LLC, a joint venture of Spectra and Phillips 66. The deal is expected to close by the end of November when Spectra, Phillips 66 and DCP Midstream each would own one-third of the pipelines and equally fund their completion. The aggregate investment by Spectra is expected to be $700-800 million. Sand Hills, which would take natural gas liquids from the Permian Basin and Eagle Ford Shale to Gulf Coast markets, would have an initial capacity of 200,000 b/d and be expandable to 350,000 b/d. The first phase recently came online and connection to Mont Belvieu, TX, is expected by year-end (see Shale Daily, Oct. 29). The timing of Sand Hills’ second phase, the Permian portion of the pipeline, has advanced and is due to be in service in 2Q2013. Southern Hills would provide 150,000 b/d, expandable to 175,000 b/d, of capacity from the Midcontinent to Mont Belvieu and has a targeted in-service date of mid-2013.

Wyoming Gov. Matt Mead last Friday announced new heads of the state’s environmental and treasury departments. Both new Department of Environmental Quality (DEQ) Director Todd Parfitt and Treasurer Mark Gordon hold key roles for the oil/gas industry in the state. In replacing DEQ Director John Corra, who retires Wednesday, Parfitt will be involved in issues touching everything from water quality to fossil fuels, said Mead, while thanking Corra for his nine years of heading DEQ. New Treasurer Gordon, who fills a vacancy created by the death of Joe Meyer Oct. 6, faces a state budget deficit of more than $30 million in the next two years, exacerbated by continuing low natural gas prices (see Daily GPI, Oct. 24).

Attorneys on both sides of the legal battle over Act 13, Pennsylvania’s omnibus Marcellus Shale law, spent two hours in a packed Pittsburgh courtroom Wednesday giving oral arguments before the state Supreme Court.

Two Republican state senators, key supporters of Marcellus and Utica shale gas drilling in New York, are anxious to see Gov. Andrew Cuomo’s administration move forward with the process to establish rules for drilling and high-volume hydraulic fracturing (HVHF).

Supporters of President Obama are twice as likely to want stringent regulation on hydraulic fracturing (fracking) than Mitt Romney backers, according to a Bloomberg National Poll released Thursday.

While President Obama repeated his pledge for an “all-of-the-above” energy strategy that mingles support for both fossil and renewable resources at the Democratic National Convention last week, the emphasis was on renewables. He also continued his attack on Big Oil, warning he “would not let oil companies write this nation’s energy policy.”

Both cash and futures markets continued to grind lower with the physical market retreating anywhere from 4 to 8 cents with an average overall loss of 6 cents. Eastern, Gulf and Midwest points all took losses.