Gregory M. Kusel

17 October 2016

PHMSA Reveals Pipeline Penalty Guidelines

On Tuesday, October 11, 2016, the U.S. Department of Transportation’s Pipeline and Hazardous Materials Safety Administration (PHMSA) revealed a pipeline civil penalty framework on its website.  PHMSA will allow a respondent in an enforcement case to request a proposed civil penalty calculation related to its case.

PHMSA’s current caps for administrative civil penalties occurring on or after August 1, 2016, are $205,638 per day and $2,056,380 for a related series of violations. PHMSA states that its penalties may exceed the guideline amounts to “serve as a strong deterrence, driving down incident risk.”

PHMSA’s guidelines provide the following “assessment considerations” for determining penalty amounts:  nature; circumstances; gravity; culpability; history of prior offenses; good faith; and other matters as justice may require.

10 October 2016

British government overrules local objections to allow hydro-fracturing of new shale wells

On October 6, 2016, Sajid Javid, U.K.’s Secretary of State for Communities and Local Government, overruled local objections by granting Cuadrilla Resources permission for up to four horizontally-drilled, high-volume hydraulically-fractured wells to produce natural gas from shale formations in North Lancashire, U.K. The decision marks Britain’s first approval of new wells using the controversial method to produce natural gas from shale since Cuadrilla’s exploratory drilling was halted due to seismic activity in 2011. Earlier this year another producer was granted permission to “frack” a well it had already drilled in 2013.