Bankrupt Pipeline Contractor Leads to Liens Against PA Landowners

Ambulance-chasing lawyers for a Minnesota-based subcontractor (United Piping Inc.) have filed a lien against some of the landowners where Mariner East 2 (ME2) crosses, claiming the landowners may have to pay them because the contractor, Welded Construction, can’t. The lawyers are using a little-known law in Pennsylvania that dates to 1901 to make their claim. This is seriously screwed up. You may recall we previously told you that Williams, disputing work Welded Construction had done for them in building the Atlantic Sunrise Pipeline, refused to pay $23.5 million, causing Welded to declare bankruptcy (see Williams Withholds Payment Forcing Pipeline Builder into Bankruptcy). What we didn’t know, until now, is that Sunoco Logistics Partners, builder of the ME2 pipeline, also withheld payments to Welded. United Pipeline says because of Welded’s bankruptcy and failure to pay them (because Williams and Sunoco withheld payments), they (United) now have the right to go after landowners for that money. This is nuts!Continue reading

PA Supreme Court Upholds ME2 Right to Use Eminent Domain

One of the ways anti-fossil fuel groups have tried to stop the Mariner East 2 Pipeline project is by tying it up in court. Various lawsuits have been filed going back years. One litigant, a Big Green group headquartered in Philadelphia, the so-called Clean Air Council, has tried repeatedly to get the courts to deny ME2 the right to use eminent domain in cases where landowners refuse to cooperate (see Clean Air Council’s Strange War Against Mariner East Pipeline). CAC argued that ME2 is not a “public utility” and therefore not entitled to the use of eminent domain. That argument flamed out. In May, PA’s Commonwealth Court ruled that yes, ME2 is a public utility entitled to use eminent domain if it needs to (see PA Court Rules ME2 Pipe has Power of Eminent Domain, Period). CAC had one last card to play, taking the case to the PA Supreme Court. They played it, and lost.
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CNX Midstream Sues Contractor for Walking Away from Pipe Project

On Monday, CNX Midstream sued West Virginia contractor Ronald Lane Inc. claiming the contractor “without warning or justification ceased work on the Project and abandoned the Project,” the Project being a package of water and gas pipelines in Greene and Washington counties in PA. And that, “Lane informed [CNX] that Lane intended to redirect all of its forces and efforts to other projects that Lane considered to be more profitable than the Project. Lane made it clear to [CNX] that Lane had no intention to perform any more work on the Project.” Lane was the winning bidder for the Project in late 2017 at a total cost of $7.1 million. According to the lawsuit, CNX claims Lane began construction in March and abandoned the Project in June.
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NY, Other Lib States Try to Block Dominion New Market Pipe Project

New Market Project – click for larger version

Last July a small group of rich snobs from Cooperstown, NY calling themselves Otsego2000 sued the Federal Energy Regulatory Commission (FERC) in federal court to try and stop Dominion Energy’s New Market Project (currently under construction), a VERY modest upgrade to an existing pipeline that runs through Upstate (see Otsego2000 Snobs Appeal FERC Approval of New Market Pipe Project). The false premise of Otsego2000’s lawsuit is that FERC did not consider mythical man-made global warming when it decided to approve the New Market Project. Unfortunately, the wildly left/radical New York Attorney General’s office has just entered the case by filing a “friend of the court” brief, along with the wildly left/radical AGs in Maryland, New Jersey, Oregon, Washington State, Massachusetts and the District of Columbia. But wait…the pipeline doesn’t run through any of those other states (other than NY) and has zero impact on those other states. Doesn’t matter. The point is they want to redefine how FERC does its job by bastardizing our laws, and this case conveniently provides them with a way to do it.
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Court Rules on “Diligence” in Locating OH Mineral Rights Owners

How much “diligence” is required when trying to locate the heirs of mineral rights owners in Ohio, as stipulated by the Ohio Dormant Minerals Rights Act (DMA)? That issue was addressed, once again, last week–this time by Ohio’s 7th District Court of Appeals. The DMA requires a surface owner to exercise “reasonable due diligence” to ascertain the names and addresses of mineral holders and their heirs prior to serving notice of abandonment by publication. The question is, what is “reasonable due diligence”? Is there a common standard? The 7th District decided there is no common standard, and what’s reasonable in one case may not be reasonable in another. In other words, it all depends–and is unique in each case.
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Mariner East Defends Itself Before Same Judge Who Once Blocked It

In May of this year, Elizabeth Barnes, an administration law judge for the Pennsylvania Public Utility Commission (PUC), unilaterally ordered Sunoco Logistics Partners to “cease and desist all current operation, construction, including drilling activities on the Mariner East 1, 2 and Mariner East 2X pipeline” in West Whiteland Township in Chester County, PA (Antis Get Lib Judge to Shut Down All Mariner East Pipes, Dems Rejoice). The judge also shut down all operations of Mariner East 1 across the entire state, ruling that she was “enjoining Respondent from operating Mariner East 1.” It was a breathtaking display of arrogance and seizure of power that does not belong to her. Barnes’ closure of ME1 and ME2 was later overturned by the full PUC (see PA PUC Overrules Lib Judge – Mariner East 1 Returns to Service and PA PUC Allows ME2 Pipeline Work to Restart Near Philly). Last week a ginned up “emergency relief petition” was aired before Barnes. Same deal. Antis want to shut down ALL of the Mariner East projects–permanently. Barnes was the judge hearing the “testimony” of the antis, along with a vigorous defense by Sunoco. Did she learn her lesson the first time?
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EQT Avoids Trial, Settles WV Class Action re Royalty Deductions

Two weeks ago MDN told you about a class action lawsuit that’s been brewing in West Virginia since 2013, brought by 10,000 WV landowners and royalty rights owners against EQT over the company’s practice of deducting post-production expenses from royalty payments (see WV Class Action Against EQT re Royalty Deductions Heads to Court). The trial was set to begin this past Tuesday, but we’re just now learning that late last week EQT settled with the plaintiffs out of court. We don’t have many details. What we do have is confirmation that there’s been a settlement and that the trial was canceled. Here’s the details we have so far.
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4th Circuit Court Cancels Mountain Valley Pipe Nationwide Permit

In early October MDN reported that the U.S. Court of Appeals for the Fourth Circuit had “vacated” (canceled, overturned) a permit issued by the U.S. Army Corps of Engineers in West Virginia that would allow Mountain Valley Pipeline (MVP) to use a more environmentally friendly form of crossing four rivers in the state than is technically allowed under federal Clean Water Act regulations (see Court Overturns MVP WV Permit; FERC Shutdown Coming Again?). The court said the Army Corps essentially allowed a substitution of methods under the law that’s not allowed, and so the entire permit, covering 591 streams, rivers and wetlands, is now vacated. The court issued it’s full decision/opinion on Tuesday. The good news is that the Army Corps and MVP are reworking the permit and hope to get it approved soon, and that completion of the project is still on track for the revised “end of 2019.”
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PA Supreme Court Gives Drillers Victory in Chapter 78a Regs Case

In August, the Pennsylvania Commonwealth Court handed PA drillers a partial victory in their quest to block onerous new drilling regulations, part of something called Chapter 78a (see Partial Victory for PA Drillers re DEP Chapter 78a Drilling Regs). This issue involves an effort by the liberal Gov. Tom Wolf administration to impose onerous new regulations on the Marcellus industry, costing lots of money with virtually no environmental benefits. The Marcellus Shale Coalition, on behalf of the industry, fought back and won in Commonwealth Court. The state Dept. of Environmental Protection appealed the case to the PA Supreme Court, and yesterday the Supremes quashed the appeal–said they refuse to hear it. Meaning the decision by the Commonwealth Court stands. The Marcellus industry won, and the DEP lost.
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Allegheny Twp Antis Ask PA Supremes to Consider Frack Ban via ERA

In November 2015, MDN first reported on a zoning court case in Westmoreland County, PA that’s still playing out (see 3 Western PA Antis Weigh Appeal of Court Ruling in Zoning Case). Three ladies brought a lawsuit against Allegheny Township because the town approved a permit for CNX Gas to drill a well on a farm owned by John and Anne Slike. Since the farm is about 1,200 feet from where the ladies live, they objected. The ladies’ legal argument is that fracking is a violation of the state’s Environmental Rights Amendment (ERA). After losing in lower courts, they eventually lost their case in PA Commonwealth Court in October (see PA Antis Suffer Crushing Defeat in SWPA Zoning Case re ERA). Which should have been the end of it. But it seems the pockets of Big Green groups (which are funding the lawsuit) is bottomless. The ladies and their Big Green lawyers have just appealed the case to the PA Supreme Court. Will the Supremes accept it?
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PA Supreme Court Agrees to Hear Briggs “Rule of Capture” Case

This is big news that will impact nearly every landowner and shale driller in Pennsylvania. In April, MDN brought you the news that Pennsylvania Superior Court had handed down a decision (known as the “Briggs” case) that has the power to greatly restrict, perhaps even stop, Marcellus drilling in PA (see PA Superior Court Overturns “Rule of Capture” for Marcellus Well and PA “Rule of Capture” Case has Power to Limit Marcellus Drilling). The issue, in brief, is that a PA Superior Court decision disallows using the age-old principle called the “rule of capture” when it comes to shale drilling and fracking in PA. Southwestern Energy successfully argued in a lower court that the odd crack here and there that may slip under a neighbor’s property from fracking is permissible. The neighboring landowner, not signed with Southwestern, appealed that decision to Superior Court and won. Southwestern then appealed the case to the PA Supreme Court and the court has just announced it will hear the case. How will this affect nearly every landowner, signed or not, in shale regions of the state?
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NY State Court Denies Northern Access Pipe Eminent Domain

Another bump in the road for National Fuel Gas Company and their Northern Access Expansion pipeline project. Not a major hurdle. Not an apocalypse. Not the end of the line. A bump. The Appellate Division of New York State Supreme Court (in NY, Supreme Court is a low court, one step up from county court), overturned the decision of the lower Supreme Court granting NFG the power of eminent domain to build Northern Access, a project not scheduled to get built until 2022. The attorney who won the case against NFG proclaimed without eminent domain, “The pipeline is dead.” We say he’s dead wrong.
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The War to Build PennEast Pipeline Continues

It’s been almost a year since the Federal Energy Regulatory Commission (FERC) granted final approval for the PennEast Pipeline project, a $1 billion, 120-mile natgas pipeline that will stretch from northeast PA to the Trenton area of New Jersey (see FERC Grants Final Approval for PennEast Pipe – Real Battle Begins). DTE Energy’s NEXUS Pipeline, a 255-mile pipeline from Columbia County in Ohio to Southern Michigan, received its FERC approval around the same time. NEXUS is already built and flowing, PennEast hasn’t turned the first shovelful of dirt yet. What’s going on?
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EQT Tries to Gut WV 1982 Minimum Royalty Law for Flat Rate Leases

EQT certainly isn’t following Dale Carnegie’s advice on How to Win Friends and Influence People. Just the opposite, as the company continues to squeeze every last penny it can out of landowners’ pockets who hold old “flat rate” leases in West Virginia. We’ve reported on EQT’s efforts to overturn WV’s Senate Bill (SB) 360, passed earlier this year and signed into law by Gov. Jim Justice (see EQT Still Fighting WV Minimum Royalty Law for Flat Rate Leases). That law disallows post-production deductions for flat rate leases, ensuring landowners receive a minimum 12.5% royalty. In April, EQT sued to overturn the original law, from 1982, on which SB 360 rests–the law that guarantees a 12.5% royalty. Get rid of the original law, and the later law (disallowing deductions) disappears too.
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WV Class Action Against EQT re Royalty Deductions Heads to Court

It’s been five years in the making, but finally a class action lawsuit that began in 2013, on behalf of 10,000 West Virginia landowners and royalty rights owners against EQT’s practice of deducting post-production expenses from royalty payments, will finally get its day in court in two weeks. That’s what we learn from an extended article published by ProPublica and the Charleston Gazette-Mail on the topic of WV drillers and their practice of “whittling away payments” from rights owners. Just over a month ago MDN told you about an elderly WV couple who won their private lawsuit against EQT on the same matter (see EQT Loses Post-Production Deduction Lawsuit to WV Couple). Based on the outcome of that lawsuit, EQT should be a tad nervous about this class action proceeding to trial.
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Anti Group Loses Penn Twp Frack Ban Case in PA Commonwealth Court

The last time we checked in (June) on a brewing frack ban in Penn Township (Westmoreland County), PA, a challenge to a local ordinance which allows Apex Energy and Huntley & Huntley to drill and operate wells rested with a county judge. Things have since rapidly progressed. We’re guessing the local judge ruled in favor of allowing the wells to be drilled because the case was appealed to PA Commonwealth Court. Late last week the judges in Commonwealth Court issued a ruling in favor of Penn Township’s “special exception” permits awarded to Apex Energy, allowing them to drill shale wells.
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