© Copyright 2013 by K&L Gates LLP. All rights reserved.

UNIVERSITY OF PITTSBURGH SCHOOL OF LAW

2013 ENERGY LAW & POLICY INSTITUTE

Changing laws and best practices in shale gas development

Michael G. Zanic – Energy, Infrastructure & Resources Practice Area LeaderK&L Gates, Pittsburgh

August 2, 2013

This presentation is for informational purposes and does not contain or convey legal advice. The information herein should not be used or relied upon in regard to any particular facts or circumstances without first consulting a lawyer.

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Overview and Contents

Development of Best Practices

Background/Context

Marcellus Shale Coalition (http://marcelluscoalition.org/category/library/recommened-practice/)

Det Norske Veritas

(http://www.dnv.com)

Center for Sustainable Shale Development

(http://www.sustainableshale.org/performance-standards/)

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Overview and Contents (cont.)

Recent Oil & Gas Case Law (PA, OH, WV) Robinson Township v. Commonwealth (PA: Act 13) Butler v. Charles Power Estate (PA: Dunham Rule) Humberston v. Chevron U.S.A. Inc. (PA: surface

impoundments) Caldwell v. Kriebel Resources Co., LLC (PA: lease

obligations) In re: Powell (PA: rejection of lease in bankruptcy) Harrison v. Cabot Oil and Gas Corporation (PA: extension

of lease term) Schychuck v. Chesapeake Appalachia, LLC (PA: federal

court jurisdiction)

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Overview and Contents (cont.)

Antolak v. Solid Rock Energy, Inc. (OH: federal court jurisdiction)

State ex. rel. Morrison v. Beck Energy Corp. (OH: Ohio preemption)

Bilbaran Farm, Inc. v. Bakerwell, Inc. (OH: implied covenants)

Martin v. Hamblet (WV: surface owner rights) Stone v. Chesapeake Appalachia, LLC (WV: rule of

capture) Cain v. XTO Energy, Inc. (WV: pooling)

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Overview and Contents (cont.)

Who Will Regulate Shale Development?

Feds v. States

Identification of key issues

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Overview and Contents (cont.)

Pennsylvania Legislation Oil and Gas Lease Act (eff. Sept. 9, 2013) Future issues?

Act 13 fallout Minimum Royalty Act Water and wastewater impoundments Wastewater injection wells Severance tax and/or other related taxes (for general or

specific purposes) Enchanced chemical disclosure Continued best practices regulation