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Regulatory
Supreme Court Restricts Standing to Challenge Federal Energy Facility Licenses in NRC v. Texas
Joel Reese | Jul 20, 2026
The Supreme Court held that Texas and a private company lacked standing as "parties aggrieved" under the Hobbs Act to challenge the Nuclear Regulatory Commission's grant of a license for an off-site spent nuclear fuel storage facility, because neither obtained formal intervenor status in the administrative proceeding. The decision establishes that submission of comments on a draft environmental impact statement, without successful intervention under the Atomic Energy Act, does not confer party status sufficient to seek judicial review of the Commission's final licensing order.
Fifth Circuit Enforces Arbitration Against FLSA Claimant Through Incorporation by Reference in Staffing Agreement
Joel Reese | Jul 20, 2026
The Fifth Circuit vacated a district court's denial of arbitration in an FLSA suit brought by safety consultant Shawn Michael Ford against ConocoPhillips, holding that Ford's Master Consulting Agreement with staffing firm Bedrock PC incorporated by reference a Master Agreement for Support Services between Bedrock Petroleum and ConocoPhillips containing a mandatory arbitration provision. The panel rejected Ford's argument that the MSA could not be incorporated because it was executed by Bedrock Petroleum rather than Bedrock PC, finding that the MSA's definition of "Contractor Group" included Bedrock Petroleum's affiliates such as Bedrock PC.
Fifth Circuit Applies Louisiana Oilfield Anti-Indemnity Act to Offshore Platform Service Contract, Rejecting Maritime Law Characterization
Joel Reese | Jul 20, 2026
The Fifth Circuit held that a master service contract between an offshore platform owner and a labor provider was nonmaritime despite requiring vessel transportation, rendering the contract's indemnity provision unenforceable under Louisiana's Oilfield Anti-Indemnity Act. The court applied a two-part test focusing on whether vessels would play a substantial role in contract completion, finding that the contract's definition of work as 'Lease Operators' and the parties' expectations precluded maritime characterization under OCSLA.
Federal Court Upholds Texas LSIPA Against Preemption Challenge by Chinese-Owned Renewable Energy Company
Joel Reese | Jul 20, 2026
A renewable energy subsidiary of a Chinese company challenged Texas' Lone Star Infrastructure Protection Act under the Supremacy Clause and Equal Protection Clause, arguing federal CFIUS authority preempted state restrictions on foreign investment in critical infrastructure. The Western District of Texas granted defendants' motion to dismiss, rejecting conflict preemption, field preemption, and dormant foreign affairs preemption theories, and finding the plaintiff lacked standing to assert Equal Protection claims.
Southern District of Texas Denies Motion to Disqualify V&E in BOEM Surety Bond Indemnity Dispute
Joel Reese | Jul 20, 2026
W&T Offshore moved to disqualify Vinson & Elkins from representing Endurance and Lexon in litigation over a Payment and Indemnity Agreement securing BOEM-required decommissioning surety bonds, arguing V&E's prior representation from October 2014 to March 2023 on corporate finance matters gave the firm access to confidential information about W&T's surety bonding program. Magistrate Judge Dena Hanovice Palermo denied disqualification, holding W&T failed to meet its heavy burden of demonstrating the prior corporate finance representation was substantially related to the current indemnity agreement dispute.
Southern District of Texas Denies Sureties' Demand for $105 Million in Collateral for Gulf of Mexico Decommissioning Bonds
Joel Reese | Jul 20, 2026
W&T Offshore's sureties moved for preliminary injunctions to compel cash collateral deposits securing BOEM-mandated decommissioning bonds for Gulf of Mexico operations, arguing their indemnity agreements contractually stipulated to irreparable harm. Magistrate Judge Palermo recommended denial, finding that contractual stipulations of irreparable harm, without more, are insufficient to satisfy the burden for preliminary injunctive relief.
Southern District of Texas Grants Section 1782 Discovery Against Texas E&P Companies for DRC Administrative Challenge to Lake Kivu Methane Auction
Joel Reese | Jul 20, 2026
Two Congolese environmental NGOs successfully obtained Section 1782 discovery from Texas-based oil and gas companies in preparation for an administrative lawsuit challenging a 2022 methane gas block auction in Lake Kivu, DRC, alleging the auction violated Congolese law through lack of transparency, failure to obtain Council of Ministers approval, and inadequate environmental evaluation and community consultation. Judge Drew B. Tipton of the Southern District of Texas granted the petition for discovery including document production and depositions, finding the statutory requirements satisfied and that the proceeding need only be in reasonable contemplation under Intel Corp. v. Advanced Micro Devices, Inc.
Fifth Circuit Bars Surety's Subrogation Claims Against Prior OCS Leaseholders for Decommissioning Bond Payments
Joel Reese | Jul 20, 2026
The Fifth Circuit affirmed summary judgment against Lexon Insurance, which issued performance bonds securing offshore decommissioning obligations and sought reimbursement from Chevron, BP, and Sojitz as prior leaseholders under subrogation, contribution, and unjust enrichment theories. Applying Louisiana law to fill gaps in OCSLA, the court held that the surety had no right of recourse against prior leaseholders who were non-parties to the bonds and that the prior leaseholders did not share an equal burden with the surety.
Fifth Circuit Upholds FERC's Denial of Rolled-In Rate Predetermination for Interstate Pipeline Expansion
Joel Reese | Jul 20, 2026
Gas Transmission Northwest challenged FERC's denial of a predetermination that rolled-in rates would apply to its pipeline expansion project, while Washington, Oregon, and environmental groups contested FERC's certificate approval under NEPA and the Natural Gas Act. The Fifth Circuit rejected all challenges, holding that FERC reasonably applied its longstanding depreciation-rate policy to set initial rates and properly declined to consider compressor replacements as part of the expansion project subject to environmental review.
Texas Appellate Court Affirms Manufacturing Exemption for Oilfield Chemical Containers in Sales Tax Refund Dispute
Joel Reese | Jul 20, 2026
ChampionX, a manufacturer of chemicals for oil and gas exploration, production, refining, and chemical processing, successfully claimed sales and use tax exemptions under Texas Tax Code Section 151.318 for returnable porta-feed containers ranging from 30 to 700 gallons used to transport hazardous chemicals to customers. The State argued the containers were taxable under the specific Container Exemption in Section 151.322 and were excluded from the Manufacturing Exemption under Section 151.318(c) because they were used to distribute, transport, maintain, and store chemicals.
Texas Court of Appeals Holds Oilfield Chemical Manufacturer's Porta-Feed Containers Qualify for Manufacturing Exemption from Sales Tax
Joel Reese | Jul 20, 2026
ChampionX, a manufacturer of chemicals for oil and gas exploration, production, and refining, successfully claimed sales and use tax refunds on returnable porta-feed containers (ranging from 30 to 700 gallons) and associated cleaning and transportation services under Tax Code Section 151.318's manufacturing exemption. The Comptroller argued the containers were taxable under the specific Container Exemption in Section 151.322 and were excluded from the manufacturing exemption under Section 151.318(c) because they were used to distribute, transport, maintain, and store chemicals rather than being used or consumed during actual manufacturing.
Fifth Circuit Dismisses Challenge to LNG Export Terminal for Lack of Standing, Reinforcing Concrete Injury Requirements
Joel Reese | Jul 20, 2026
The Fifth Circuit denied environmental groups' petition challenging MARAD's approval of a deepwater LNG export port, holding that none of the organizations' members established concrete and particularized injury-in-fact fairly traceable to the project. The court rejected standing claims from commercial fishermen, recreational users, and organizational staff who failed to demonstrate project-specific use of affected waters or nearby areas that the facility would impair.
Western District of Texas Dismisses Securities Fraud Claims Against Energy Corporation Over Unauthorized Pre-Registration Trading
Joel Reese | Jul 20, 2026
An investor brought § 10(b) and Rule 10b-5 claims against an energy corporation and two officers, alleging shares intended to represent private ownership were traded on over-the-counter markets months before formal authorization or regulatory compliance. The court granted dismissal despite finding statutory standing, holding the investor failed to plead manipulative acts or material misrepresentations with the particularity required under the Private Securities Litigation Reform Act.
Fifth Circuit Applies Louisiana Oilfield Anti-Indemnity Act to Offshore Platform Fire Watch Contract, Finding No Maritime Nexus
Joel Reese | Jul 20, 2026
The Fifth Circuit affirmed that a master services contract between offshore platform operator Fieldwood Energy and safety contractor United Fire & Safety was nonmaritime in nature, triggering OCSLA's gap-filling provision to apply Louisiana's Oilfield Anti-Indemnity Act and void indemnity provisions in a personal injury action arising from a liftboat capsizing incident. The panel held that neither the contract nor job order email provided that the chartered liftboat would play a "substantial role" in completion of fire watch services on the fixed platform, despite the vessel's use for transportation, crane work, and lodging.
Colorado ECMC Approves 85% Penalty Reduction for Six Operators in P&A Data Falsification Cases Amid $1B Financial Assurance Shortfall
Joel Reese | Jul 14, 2026
Colorado's Energy and Carbon Management Commission approved settlement agreements with Noble Energy, Crestone Peak, Bonanza Creek, HighPoint, Extraction Oil & Gas, and Kerr-McGee reducing aggregate civil penalties from $13.4 million to under $2 million for submitting falsified plugging and abandonment compliance data through third-party contractors. The settlements were finalized one day before ECMC Director Julie Murphy announced her resignation amid a separate investigation revealing a $1 billion financial assurance shortfall for cleanup of defunct wells.
Alaska Supreme Court Limits Scope of Cumulative Impact Review for Mining Project Permits Under Water Use Act and ROWLA
Joel Reese | Jul 06, 2026
The Alaska Supreme Court affirmed DNR's approval of water appropriation permits and a natural gas pipeline right-of-way lease for the Donlin mine project, holding that the agency properly limited its environmental review to the direct impacts of the permitted activities themselves rather than conducting cumulative impact analysis of the entire mining operation. The decision establishes that neither the Water Use Act nor the Right-of-Way Leasing Act requires agencies to consider downstream environmental effects of end-use activities when evaluating discrete permit applications for water appropriations and pipeline infrastructure.
Texas Business Court Holds Legislative Reduction of Amount-in-Controversy Threshold Constitutes 'Fact' Permitting Second Removal
Joel Reese | Jul 06, 2026
The Business Court of Texas held that House Bill 40's reduction of the jurisdictional threshold from $10 million to $5 million constituted a discoverable 'fact' under Section 25A.006(f)(1)(B), permitting EOG Resources to remove a breach of contract action two days after the statute's effective date despite the Court having previously remanded the case for failure to meet the higher threshold. OWL AssetCo, a water services provider seeking indemnification for produced water contamination damages in Eddy County, New Mexico operations, argued the statutory change was not a 'fact' and that EOG's removal was untimely.
Railroad Commission Seeks $6.95 Million from Disposal Well Operator for Alleged Induced Blowout at Legacy Well
Joel Reese | Jul 06, 2026
The Texas Railroad Commission is seeking $6.95 million—230 times the average well plugging cost—from WaterBridge Operating LLC following a September 2024 Ward County disposal well blowout that released toxic wastewater from a 1950s-era legacy well. The administrative proceeding tests whether operators of permitted disposal wells operating within regulatory injection pressure limits can be held financially liable for blowouts at improperly plugged offset wells allegedly induced by subsurface pressure migration.
Texas Supreme Court Upholds PUC's Emergency Scarcity-Pricing Orders During Winter Storm Uri
Joel Reese | Jul 06, 2026
The Texas Supreme Court reversed the Court of Appeals and upheld the Public Utility Commission's emergency orders directing ERCOT to manually adjust the scarcity-pricing mechanism during Winter Storm Uri, raising wholesale electricity prices to maximum levels while firm load was being shed. The Court held that Luminant Energy had standing to challenge the orders despite their temporary nature, that the orders constituted reviewable "competition rules" under PURA, and that the Commission substantially complied with the APA's emergency rulemaking procedures.
Fifth Circuit Bars Surety's Subrogation Claims Against Prior OCS Leaseholders for Decommissioning Costs
Joel Reese | Jul 06, 2026
After paying over $11 million to the federal government for decommissioning obligations on West Cameron Block 168, surety Lexon Insurance sought reimbursement from prior leaseholders Chevron, BP, and Sojitz under theories of subrogation, contribution, and unjust enrichment. The Fifth Circuit affirmed summary judgment for the prior leaseholders, holding that Louisiana law—applied to fill gaps under OCSLA—barred recovery because the surety had no right of recourse against non-parties to the bonds and any enrichment was justified by the prior leaseholders' bargained-for indemnity agreements with the purchaser.
Texas Court of Appeals Addresses Dealer's Heavy Equipment Inventory Taxation and Section 25.25 Appraisal Roll Corrections After EXLP Leasing
Joel Reese | Jul 06, 2026
J-W Power Company, which leases natural-gas compressors to customers in oil-and-gas fields, sought to correct Henderson County's 2013-2016 ad valorem tax appraisals under Tax Code Section 25.25, arguing the equipment should be taxed only in Gregg County as dealer's heavy equipment inventory under the EXLP Leasing framework. The Tyler Court of Appeals affirmed summary judgment for the appraisal district, holding JWP failed to establish as a matter of law that the compressors were subjected to multiple appraisals or did not exist in the form or location described on the appraisal rolls.
TCEQ Proposed Rulemaking on Treated Produced Water Land Application Raises Arbitrary-and-Capricious and Groundwater Protection Challenges
Joel Reese | Jul 06, 2026
TCEQ's proposed rulemaking would transfer treated produced water land application permitting authority from the Railroad Commission, applying existing municipal and industrial wastewater standards—testing only for salts, nitrate, E. coli, and bacteria—to fracking wastewater spread on Texas farmland. The framework lacks specific standards for produced water's chemical constituents and relies on operator-submitted technical assessments for groundwater protection determinations, drawing criticism following the April 2026 Grandfalls incident that released 1.5 million gallons of toxic wastewater.
Federal Court Orders $109 Million Refund for Wyoming BLM Leases Invalidated Under NEPA, Permits Continued Production from Nine Wells
Joel Reese | Jul 06, 2026
Chief Judge Brian Morris ordered BLM and Wyoming to refund $109 million in bonus bids to energy companies after finding Secretary Zinke's 2018 memo illegally authorized 2019 lease sales in Wyoming sage grouse habitat by unreasonably misconstruing 2015 habitat protection plans. The court permitted nine producing wells to continue operations despite the underlying lease invalidation, with those leases having generated $15.1 million in state taxes.
Colorado ECMC Approves $2 Million Settlement for Falsified Toxic Substance Reporting at 344 Front Range Sites Despite Fraud Allegations
Joel Reese | Jun 25, 2026
Six Front Range operators—including Noble Energy (now Occidental), Bonanza Creek, and Extraction Oil & Gas—settled falsified toxic substance reporting violations at 344 drill sites for $2 million after consultants Eagle Environmental and Tasman Geosciences allegedly altered laboratory data between 2021-2024, avoiding $11 million in potential penalties. The Colorado ECMC approved settlements 4-1 over Commissioner Ackerman's dissent that 'purposeful fraud' in environmental compliance reporting warranted full statutory penalties rather than 82% reductions.