United States

Subscribe to United States via RSS

On Wednesday, August 26, a coalition of environmental groups threatened to sue the U.S. Environmental Protection Agency (“EPA”) if the regulations under the Resource Conservation and Recovery Act (“RCRA”) are not updated to restrict the disposal of waste associated with oil and gas production.

The coalition specifically asked the EPA to review and revise the RCRA regulations pursuant to the statutory mandate found in sections 2002(b) and 4002(b) of RCRA. Under these sections, the EPA must review and revise RCRA regulations and guidelines “no less frequently than every three years.” (42 U.S.C. §§ 6912(b), 6942(b).)

RCRA was enacted in 1976 to govern the disposal of solid waste. Solid waste is broken down into (1) hazardous solid waste and (2) non-hazardous solid waste. The most notable provisions of RCRA are included in Subtitle C, which directs the EPA to establish controls on the management of hazardous wastes from their point of generation, through their transportation and treatment, storage and/or disposal.
Continue Reading Activists Threaten to Sue if EPA doesn’t Update RCRA Regs to Cover Oil & Gas Industry

On Thursday, the Environmental Protection Agency (“EPA”) released a long awaited, and congressionally mandated, study detailing the relationship between hydraulic fracturing and drinking water. The EPA found no signs of “widespread, systemic” drinking water pollution from hydraulic fracturing.

“It is the most complete compilation of scientific data to date,” says Dr. Thomas Burke, with the EPA’s Office of Research and Development, “including over 950 sources of information, published papers, numerous technical reports, information from stakeholders and peer-reviewed EPA scientific reports.”

“After more than five years and millions of dollars, the evidence gathered by EPA confirms what the agency has already acknowledged and what the oil and gas industry has known,” said Erik Milito, with the American Petroleum Institute. “Hydraulic fracturing is being done safely under the strong environmental stewardship of state regulators and industry best practices.”
Continue Reading EPA Finds No Systemic Threat to Drinking Water from Fracking

Three states have recently taken a stand for or against controversial bans on hydraulic fracturing. Oklahoma, Texas, and Maryland have all passed laws within the past month relating to hydraulic fracturing bans.

Oklahoma

Last Friday, Oklahoma Governor Mary Fallin signed Senate Bill 809, which prohibits local governments from choosing whether to have oil and gas operations within their jurisdictions. Oklahoma’s law allows exceptions for “reasonable” restrictions for setbacks, noise, traffic issues and fencing. Governor Fallin said “A patchwork of regulations that vary across the state would be inconsistent with the goal of reasonable, easily understood regulations and could damage the state’s economy and environment.” Senate Bill 809 reaffirms that the Oklahoma Corporation Commission is the primary entity charged with establishing a unified regulatory framework for the energy industry. Chad Warmington, president of the Oklahoma Oil and Gas Association, said “This bill was a good compromise for all involved. It maintains the Corporation Commission’s role in regulating oil and gas activities, without limiting cities’ ability to protect their residents.” Senate Bill 809 passed with wide margins in both the House and the Senate.
Continue Reading States Show Their True Colors on Fracking – One Enacts a Ban, While Two Others Prohibit All Local Bans

Today, May 8, 2015, the Pipeline and Hazardous Materials Safety Administration published a final rule for rail transport of crude oil in the Federal Register. These rules come after several high-profile oil train derailments, including one recently in North Dakota that caused the evacuation of a nearby town.

The final rule applies to “high-hazard flammable trains,” defined as trains with a continuous block of 20 or more tank cars loaded with a flammable liquid or 35 or more tank cars loaded with a flammable liquid dispersed through a train. The final rule regulates: (1) tank car design standards, (2) braking systems, (3) speed restrictions, (4) routing restrictions, (5) classifications of unrefined petroleum-based products, and (6) notification requirements.

Tank Car Design

New tank cars constructed after October 1, 2015 are required to meet new design criteria. Tank cars must be constructed with 9/16 inch steel walls and a head shield with a minimum thickness of 1/2 inch. The entire protection system must be covered with a metal jacket of at least 11 gauge steel. Tank cars must also include improved pressure relief valves and bottom outlet valves. All existing tanks must be retrofitted according to a risk based schedule in the next three to five years.
Continue Reading New Federal Oil-By-Rail Regulations Published

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

One of the few sectors that consistently added jobs in 2011 was U.S. minerals mining. Today, this industry supports 1.1 million American jobs nationwide and has enabled modern products such as aircrafts, medical equipment and state-of-the-art electronics to come to fruition. Some of the fastest growing industries in America—including high tech, automotive manufacturing and renewable…

About the Mineral Law Blog

Learn More

Here Stoel Rives shares insight and analysis about key mineral law developments. Drawing on a very active natural resources practice, we aim to keep readers informed about the legal aspects of news that impacts exploration and development of all things mineral.