Environmental and Energy Law Blog

Monday, May 27, 2019

Immunity Under the Texas Environmental, Health, and Safety Audit Privilege Act


Under the Texas Environmental, Health, and Safety Audit Privilege Act (“the Act”), those entities who conduct voluntary health, environmental, and safety audits of regulated facilities and operations are entitled to immunity from penalties for violations that are discovered, disclosed, and corrected within a specified amount of time. Below is some additional information about immunity under the Act.  

Voluntary disclosure of violations 

In order for an entity to receive immunity, a disclosure must be voluntary and preceded by a notice of audit. A disclosure is considered voluntary if the following conditions are met:

  • The disclosure was made soon after the violation was discovered
  • The disclosure was submitted in writing 
  • The disclosure was made prior to the initiation of an independent investigation 
  • The violation was disclosed as the result of a voluntary audit
  • Efforts to correct the violation are initiated by an entity within a reasonable amount of time of the disclosure
  • The disclosing entity cooperates during the investigation of the issues identified
  • The disclosed violation hasn't caused injury or an imminent risk of injury
  • The disclosure isn't required by an enforcement decree or order 

    And when a violation is discovered during an audit that was conducted prior to an acquisition closing date, the person making the disclosure must certify the following:

  • Before the closing date, he or she wasn't responsible for compliance at the regulated entity
  • Before the closing date, he or she didn't have the largest ownership share of the seller
  • Before the closing date, he or she and the seller didn't have a common corporate parent 

 Limitations

Immunity does not apply under any of the following circumstances:

  • The disclosed violation was committed intentionally or knowingly 
  • The disclosed violation was committed recklessly
  • The disclosed violation resulted in a significant economic benefit that gave the violator an advantage over its competitors
  • An administrative law judge or court finds that the person or entity claiming immunity has continuously committed significant violations and hasn't tried to bring the facility into compliance

Texas Environmental Law Attorneys 

If you or your company have been cited for non-compliance or are facing legal action based on non-compliance, then you need an experienced


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Thursday, May 16, 2019

An Overview of CERCLA Enforcement and Penalties


The Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) provides federal funds to clean up uncontrolled or abandoned hazardous waste sites, accidents, spills, and other emergency releases of pollutants and contaminants into the environment. Below is an overview of enforcement and penalties under CERCLA. 

Enforcement under CERCLA   

CERCLA provides the Environmental Protection Agency (EPA) with the authority to ensure the cleanup of the above pollutants. For example:

  • EPA can clean hazardous sites and later recover cleanup costs from responsible parties.
  • EPA can gather information, access a site, and seek penalties for non-compliance with agreements and orders.
    Read more . . .


Friday, April 19, 2019

An Overview of Submissions Under the Texas Environmental, Health, and Safety Audit Privilege Act


Under the Texas Environmental, Health, and Safety Audit Privilege Act (“the Act”), those who conduct voluntary environmental or health and safety audits of regulated operations and facilities are entitled to immunity from administrative penalties for violations that are discovered, disclosed, and corrected within a certain amount of time. Under the Act, an audit that qualifies for protection is a voluntary evaluation, assessment, or review of compliance with environmental or health and safety laws or a related permit conducted by an operator or owner. Below is an overview of the submissions required under the Act. 

Submissions under the Act 

There are three types of documents a person may submit under the Act: 

  • A notice of audit letter
  • A disclosure of violations letter
  • A request for an extension 

Notice of audit letter 

An individual must submit a notice of audit letter prior to commencing an audit. A notice of audit letter must include:  

  • The name of the individual conducting the audit
  • The date and time that the audit will commence 
  • A description of the leases, properties, or facilities to be audited
     

Disclosure of violations letter 

In order to gain immunity under the Act, an individual must submit a disclosure of violations letter, which is a voluntary disclosure of violations identified as a result of the audit.


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Friday, April 12, 2019

What is the Comprehensive Environmental Response, Compensation, and Liability Act?


The Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) was passed in 1980 in response to the hazardous waste practices of the time. CERCLA provides federal funds to clean up abandoned or uncontrolled hazardous waste sites, spills, accidents, and other emergency releases of contaminants and pollutants into the environment. CERCLA is an important environmental program, as it both ensures that valuable removal actions are taken and  enforces against responsible parties. As is discussed below, CERCLA relies on a number of enforcement tools to ensure that the above pollutants and hazards are removed in a timely manner. In addition, CERCLA promotes community involvement, accountability, and long-term protectiveness.
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Thursday, March 28, 2019

The Timely Payment of Oil and Gas Royalties in Texas


In Texas, royalties for oil and gas production are due at least 120 days after the end of the month of first sale of production from a well. This timeline allows operators approximately four months after a well starts producing to complete required administrative tasks and begin paying royalties. After this, royalties are payable 60 days or 90 days after the end of the month in which subsequent production is sold. However, operators are not required to make timely royalty payments if the royalty owner’s interest is subject to a title defect or a royalty owner declines to sign a division order. Below is some additional information about the timely payment of oil and gas royalties in Texas.
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Thursday, March 14, 2019

About Oil and Gas Survey Permits in Texas


Oil and gas pipeline construction is rampant in Texas. And when oil or gas pipelines are constructed, landowners are typically contacted by builders for easements and survey permission. While some landowners give immediate permission to builders, it is usually advisable to use an appropriate survey permit to govern the pipeline company’s surveying activities, particularly for seismic or geophysical permits. Thus, both landowners and oil and gas companies should understand such permits, as they are a common legal component of oil and gas pipeline construction. Below is some additional information on oil and gas survey permits in Texas.
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Tuesday, February 26, 2019

Avoid These Common Oil and Gas Lease Mistakes

The negotiation of oil and gas leases can be extremely complicated. Attributes such as patience,  knowledge, and experience are all required to successfully negotiate such leases. And unfortunately, mineral owners who attempt to negotiate gas and oil leases alone often end up making mistakes. However, with the assistance of an experienced


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Tuesday, February 5, 2019

What is a Choice of Law Provision in a Texas Oil or Gas Contract?

Texas courts will generally enforce oil and gas contracts as they are written unless a violation of statutory law or public policy is present. This enforceability principle applies to choice of law provisions that are common in oil and gas contracts. Below is an overview of choice of law provisions in Texas oil and gas contracts.


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Monday, January 28, 2019

What is a Farmout Agreement?


Farmout agreements are common in the oil and gas industry.  A farmout agreement is a contract in which an interest owner (“farmor”) agrees to assign interest to another party (“farmee”) in exchange for certain services. Once these services have been rendered, the farmee has earned what is known as an assignment. The assignment, which is a royalty interest, is also called a convertible override, which means that the farmor can elect to convert this override into a portion of the working interest following payout. The decision of whether to convert or not is dependent upon whether the farmer wants to share production costs in exchange for a possible increased return.
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Friday, January 25, 2019

Recent Oil Contract Case Provides Important Lessons


A case that was recently filed in the Texas Supreme Court involves an issue familiar to those in the oil industry: farmout agreement interpretation. The case, Barrow-Shaver Res. Co v. Carrizo Oil & Gas, Inc., involves a question of whether one party to an agreement may arbitrarily withhold consent from the other to take certain actions or whether consent may only be withheld if reasonable.
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Thursday, December 27, 2018

About Joint Operating Agreements

A commonly used instrument in the oil and gas industry is the joint operating agreement. A joint operating agreement is a contract for the exploration, development, and production of gas and oil properties among cotenants. Below is an overview of joint operating agreements in Texas.


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