Insight and Information on the Oil, Gas, Pipeline, & Mining Industries
The Alaska Department of Natural Resources (DNR) is soliciting public comment regarding potential regulation revisions involving the process for filing and handling appeals and requests for reconsideration under 11 AAC 02.
No specific regulations are being proposed at this time. Rather, DNR is seeking public input and suggestions before the department begins drafting proposed regulations.…
New rental rates are now in effect for state mining claims, leasehold locations, prospecting sites, and mining leases in Alaska. The new rental rates became effective on August 30, 2019, and thus are applicable to the rental year that commenced on September 1, 2019.
These increases were made by the State of Alaska Department of…
Secretary of the Interior Zinke has directed that the Bureau of Land Management immediately begin implementing the recommendations in his Sage-Grouse Review Team’s report, which was was released today, concerning the 2015 greater sage-grouse amendments to federal land use management plans. (Prior post on Sage-Grouse Review Team here.) Among other things, such as coordinating federal mitigation policy with state mitigation approaches, the Trump Administration will now be moving to “[r]emove all [sagebrush focal areas (SFAs)] and the management actions tied to SFAs.” This would include the pending withdrawal for up to 20 years of over 10 million acres of SFAs on public lands in six western states from mineral location and entry under the General Mining Law . (Prior posts on withdrawal here and here.) The report also recognizes a short-term “[n]eed to clarify under what circumstances or how the [land use management] plans recognize valid existing rights.” Because valid existing rights (i.e., a mining claim within which a valuable mineral deposit has been discovered) are relevant if a withdrawal is approved, this recommended clarification indicates that the Trump Administration may well withdraw the SFAs for a short time while it moves forward with amending the plans to remove the SFAs altogether.
Continue Reading Sage-Grouse: Short Flight for Pending 10 Million-Acre Withdrawal from General Mining Law?
On June 28, 2017, the Senate introduced a bill that aims to revitalize and overhaul various federal energy and natural resources policies. Senate Bill 1460 (S.1460), sponsored by Senators Lisa Murkowski (R-Arkansas) and Maria Cantwell (D-Washington), broadly proposes reform of United States policies on topics such as energy efficiency, supply and conservation. A key highlight of S.1460 is modernization of the electric grid, an issue that has often been touted as a national security concern. Further, on the conservation side, the bill would establish a National Park Maintenance and Revitalization Fund. While details of the bill are still forthcoming, the bill’s authors state that S.1460 will lay out a plan to strengthen the nation’s energy infrastructure.
Continue Reading Senate Proposes Legislation to Modernize Federal Energy Policies
The Bureau of Land Management (“BLM”) recently filed a Motion for Summary Judgment in a lawsuit brought by a coalition of environmental activists who have challenged the BLM’s Resource Management Plan (“RMP”) for public lands and minerals in California managed by the Bakersfield Field Office. The activists asked a California federal judge to strike down the BLM’s RMP, claiming that the BLM never considered the effect of “unconventional drilling methods,” such as hydraulic fracturing on the land.
The BLM responded by pointing out that hydraulic fracturing is not a new, unproven technology and has been routinely used in California for over 50 years. It is estimated that only 25% of new wells in the Bakersfield planning area are expected to undergo hydraulic fracturing. Furthermore, the BLM noted that 98% of new wells on federal mineral lands in the planning area are projected to be drilled on existing leases that have been producing for over 30 years and not on pristine, undisturbed lands.
The activists claimed that the BLM failed to take a “hard look” at the environmental impacts associated with fracking as required by the National Environmental Policy Act (“NEPA”). However, any claim that the BLM did not comply with NEPA in developing the RMP is particularly weak under these facts. The BLM developed a comprehensive, 1,000-page environmental impact statement (“EIS”). Additionally, before issuing a final decision, BLM commissioned an independent review of well stimulation technologies in California to ensure that its EIS accurately reflected the potential impacts of fracking. And finally, the independent review concluded that overall, the direct environmental impacts of well stimulation practice are relatively limited in California.
Continue Reading BLM Fights Back Against Activists’ Criticisms of CA Resource Management Plan
On Tuesday, May 5, 2015, the Internal Revenue Service (“IRS”) released proposed regulations defining qualifying income for Master Limited Partnerships (“MLPs”). MLPs are publicly traded partnerships that are taxed as a partnership rather than a corporation.
Being taxed as a MLP has many advantages. While shareholders in a corporation face double taxation ̶ paying taxes first at the corporate level, and then at the personal level when those earnings are received as dividends ̶ owners of a partnership are taxed only once, when they receive distributions. The absence of taxes at the company level gives MLPs a lower cost of capital than is typically available to corporations, allowing the MLPs to pursue projects that might not be feasible for corporations.
To qualify as a MLP, at least 90% of the entity’s gross income must be “qualifying income.” Previously, there had been no detailed list of what constitutes qualifying income.
These proposed regulations use the term “qualifying activities” to describe activities relating to minerals or natural resources that generate qualifying income. The IRS has now provided an exclusive list of operations that constitute qualifying activities. The activities addressed include exploration, development, mining or production, processing, refining, transportation, and marketing of any natural resource.
Continue Reading New Rules on MLPs & Qualifying Income: What Oil Services and Exploration Companies Need to Know
Minerals Make Life – an initiative created by the National Mining Association – has recently developed an informative infographic on the important role silver plays in our society. Out of all metals, silver is unique in that it has the highest electrical and thermal conductively. These characteristics make silver an important ingredient in products we…
