Mayhall Fondren Blaize

Business Litigation is spawned by loosening of federal rules

When oil and gas disputes turn into court cases, such matters may be categorized under the broad generic subject called business litigation. Such disputes are on the rise nationwide and in Louisiana. That may be due at least partially to the loosening of regulations by the federal administration and the response by environmental groups to counter with increased business litigation.

A recent dispute in another state illustrates one kind of lawsuit that is emerging as the oil and gas interests proceed with the construction projects in many communities nationwide. In the case, the mayor of a midwestern city and the city council have decided to challenge a new proposed high-pressure natural gas pipeline that will run roughly eight miles of pipelines through this town of middle-class residents. The mayor says that he'll do all that is possible to stop the project.

The mayor claims that the city, with the ironic name of Green, Ohio, cannot afford the loss of other economic development opportunities that will be caused by the proposed pipeline. The pipeline partners say that the pipeline will provide a new source of natural gas to businesses in Ohio and Michigan. The proposal is to build 255 miles of pipeline carrying as much as 1.5 billion cubic feet of gas per day from the Marcellus shale formations in Appalachia.

Landowners in the pipeline's path argue that the project's Canadian developer should not have greater rights to the land than the American citizens who own the property. Time will tell if that legal argument can be victorious. Companies wishing to develop oil and gas projects must generally first file an environmental statement before the applicable state and federal agencies.

The authorities may then issue a "certificate of convenience and public necessity," which allows the development to proceed. The catch, however, is that the federal commission that approves such projects is presently short at least one commissioner. Given the slow pace of confirmations in Washington, the subject project, and many in Louisiana and elsewhere, may be stalled until a new commissioner is appointed. In the meantime, parties involved may decide to file business litigation lawsuits to try to make the process move faster. 

Source: pennenergy.com, "Oil and Gas: Ohio city plans lawsuit to stop gas pipeline construction", Mark Gillispie, May 4, 2017

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