As the United States begins to enter a warming period leading up to the onset of Spring, Bracewell & Giuliani’s Scott Segal, head of the firm’s Policy Resolution Group, takes a look back on the Polar Vortex – the bouts of severe cold experienced by much of the country in early 2014. In this video interview, Scott discusses the impact of growing shale gas resources on the energy sector, the key role that coal-fired electric generation played during the Polar Vortex, and what this experience of severe cold tells us about future energy policy and prices.
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Video Interview: The Polar Vortex and Energy – A Look at the Impact of Shale and Coal on Energy PricesMonday, March 10, 2014 9:41 am by George Felcyn
Stan Chelney and Michael Hefter
On March 5, 2014, the United States Supreme Court upheld a $185 million arbitration award obtained by the United Kingdom’s BG Group PLC against the Republic of Argentina, pursuant to a bilateral investment treaty. The Court reversed the finding of the Court of Appeals for the District Court of Columbia that the arbitration panel lacked jurisdiction over the dispute, finding that the arbitrators, and not a court, properly determined whether the treaty’s conditions to arbitration had been satisfied.
In BG Group PLC v. Republic of Argentina, 572 U.S. __ (2014), the Supreme Court interpreted the dispute resolution provision contained in an investment treaty between the United Kingdom and Argentina (the “Treaty”), requiring each nation to afford the others’ investors “fair and equitable treatment” and forbidding the “expropriation of investments” by either nation. The Treaty permits investors to submit disputes to a local court in the country where the investment is made, and permits arbitration “where, after a period of eighteen months has elapsed from the moment when the dispute was submitted to [that] tribunal . . ., the said tribunal has not given its final decision.” (more…)
Darren Spalding, Alastair Young and Nick Kendrick
On 24 February 2014, Sir Ian Wood delivered his Final Report (the “Report”) on the future of the UK Continental Shelf (“UKCS”). The Report sets out a number of conclusions and recommended actions relating largely to more stringent regulation, a focus on regional development and better industry co-operation. If the recommendations are implemented, they will fundamentally change the North Sea oil and gas industry.
The Report’s overriding message is that for production from the UKCS to be prolonged, a change to both the regulatory and commercial landscapes will be required. The Report proposes a new regulator (the “Regulator”) which would sit within the government department currently responsible for the oil and gas industry in the UK, the Department of Energy and Climate Change (or “DECC”). The Regulator will be tasked with developing strong relationships with both UKCS operators and the Treasury, and will enjoy a significant degree of independence and operational freedom. The Report envisages that the Regulator would be staffed with experienced personnel from industry as well as attracting top new graduates. To achieve this, the Regulator would – the Report suggests – be funded by UKCS operators and should offer agreed levels of service in return for such funding. On the commercial side, the Report supports much greater co-operation between operating companies, led by the introduction of regional development, increased third party access to infrastructure, wider sharing of data and streamlining of legal and commercial negotiations between parties. Any failure to co-operate in furthering these principles could subject the relevant party to sanctions from the Regulator, including the loss of a licence. (more…)
In a historic move, the Federal Energy Regulatory Commission (FERC) for the first time on Friday, February 7, exercised its emergency authority under Section 1(15) of the Interstate Commerce Act. Using that authority, FERC directed Enterprise TE Products Pipeline Company LLC (TEPPCO) to provide priority to shipments of propane to help address propane shortages in the Midwest and Northeast. FERC extended its emergency order on Tuesday, February 11. In doing so, FERC resolved issues raised in an emergency request filed by the National Propane Gas Association (NPGA), which requested that propane shipments get priority over other products shipped by TEPPCO.
On Thursday, February 6, NPGA asked FERC to use its emergency powers to permit or direct TEPPCO to temporarily provide up to 75,000 bbls/day of capacity to propane shipments on a priority basis, through at least the first week in March, in light of current propane supply shortages. (more…)
Sandra Snyder, Richard Alonso and Tim Wilkins
On Tuesday, February 4, 2014, EPA issued a pre-publication copy of a proposed rule that if adopted would transfer greenhouse gas (GHG) permitting in Texas from EPA Region 6 to the Texas Commission on Environmental Quality (TCEQ). The proposed rule has yet to be published in the Federal Register. When it is published, the public will have 30 days to comment on the proposed rule. EPA must review and respond to those comments before it can adopt a final rule that would transfer authority to TCEQ. (more…)
Major news out of Europe confirmed the strongly held belief of many in the energy sector that European states will be the next frontier in the shale gas revolution, and it seems sooner rather than later.
In a much anticipated decision, on January 22, 2014, the European Union adopted a series of non-binding recommendations on companies engaging in hydraulic fracturing within the EU’s borders. The newly released recommendation calls for member states to adopt “minimum principles” for fracking in each member country, such as, for example, requiring a careful assessment of environmental impacts and risks, ensuring that wells conform to best practice standards, monitoring environmental effects, and informing the public about materials utilized in individual wells. The legislations calls for member states to apply the principles within six months and to report to the EU annually about what specific steps are being taken to comply. (more…)