Energy & Oil and Gas Law
Federal regulation of energy production, oil and gas leasing, pipeline safety, and FERC oversight.
Overview
Energy law governs the production, distribution, and regulation of energy resources including oil, natural gas, coal, nuclear power, and renewable energy. The Federal Energy Regulatory Commission (FERC) regulates interstate transmission of electricity and natural gas, oil pipeline transportation rates, natural gas pricing, hydroelectric dam licensing, and energy market oversight under the Federal Power Act and Natural Gas Act.
Oil and gas law involves a complex body of property, contract, and regulatory principles. Mineral rights ownership, lease negotiation (including royalty rates, bonus payments, and delay rental provisions), and the rule of capture are foundational concepts. Federal oil and gas leasing on public lands and the outer continental shelf is governed by the Mineral Leasing Act and the Outer Continental Shelf Lands Act, with the Bureau of Land Management and the Bureau of Ocean Energy Management administering these programs.
Pipeline safety is regulated by the Pipeline and Hazardous Materials Safety Administration (PHMSA) under the Pipeline Safety Improvement Act. The Energy Policy Act of 2005 provided incentives for domestic energy production and established the first federal renewable energy standards. Increasing attention to climate change has driven state-level renewable portfolio standards, net metering laws, and carbon pricing mechanisms, creating a patchwork of state energy transition policies alongside federal regulatory frameworks.
Key Statutes
| Statute | Citation | Summary |
|---|---|---|
| Federal Power Act | 16 U.S.C. §§ 791a–828c | Establishes FERC's authority over interstate electricity transmission, wholesale power sales, hydroelectric licensing, and energy market regulation. |
| Natural Gas Act | 15 U.S.C. §§ 717–717z | Grants FERC jurisdiction over interstate natural gas pipeline transportation, including the certification of new interstate pipelines and LNG facilities. |
| Mineral Leasing Act | 30 U.S.C. §§ 181–287 | Authorizes leasing of federal public domain lands for oil, gas, coal, and other mineral development, establishing royalty and bonus payment requirements. |
| Pipeline Safety Improvement Act | 49 U.S.C. §§ 60101–60143 | Establishes safety standards for hazardous liquid and natural gas pipelines, including integrity management programs and incident reporting. |
| Energy Policy Act of 2005 | Pub. L. 109-58, 119 Stat. 594 | Comprehensive energy legislation providing tax incentives, loan guarantees for nuclear power, renewable fuel standards, and electricity market reforms. |
Key Cases
Hughes v. Talen Energy Marketing, LLC
578 U.S. 150 (2016)
Held that a Maryland program requiring new power generators to enter long-term contracts at above-market rates was preempted by the Federal Power Act.
FERC v. Electric Power Supply Ass'n
577 U.S. 260 (2016)
Upheld FERC's authority to regulate demand response in wholesale electricity markets under the Federal Power Act.
POM Wonderful LLC v. Coca-Cola Co.
573 U.S. 102 (2014)
While not an energy case per se, established important principles about federal regulatory preemption relevant to energy labeling and consumer claims.
West Virginia v. EPA
597 U.S. 697 (2022)
Applied the major questions doctrine to hold that EPA lacked authority to adopt generation-shifting regulations under the Clean Air Act's Section 111(d), significantly impacting federal climate and energy regulation.
Key Regulations
FERC Regulations on Electric Utilities and Natural Gas Pipelines
FERC (18 CFR Parts 35, 154, 157, 284)
Rules governing wholesale electricity rates, natural gas pipeline certificates, transportation rates, and market-based rate authorization.
Pipeline Safety Regulations
PHMSA (49 CFR Parts 190–199)
Safety standards for natural gas and hazardous liquid pipelines, including design, construction, testing, operation, and integrity management.
BLM Oil and Gas Leasing Regulations
Bureau of Land Management (43 CFR Parts 3100–3180)
Regulations governing competitive and noncompetitive leasing of federal onshore lands for oil and gas development, including royalty rates and lease terms.
Common Issues
- Oil and gas lease interpretation and royalty disputes
- Pipeline siting, eminent domain, and environmental review
- FERC rate cases and wholesale electricity market regulation
- Hydraulic fracturing (fracking) regulation and liability
- Renewable energy project permitting and interconnection
- Surface owner vs. mineral owner conflicts
- Energy contract disputes and force majeure
- Carbon emissions regulation and climate policy compliance
State Variations
Energy regulation is divided between federal and state jurisdiction. States regulate retail electricity and gas sales, intrastate pipelines, and local utility distribution through public utility commissions. Over 30 states have adopted renewable portfolio standards or clean energy standards with varying targets. State oil and gas conservation commissions regulate drilling permits, well spacing, and production allowables. Hydraulic fracturing regulation varies from outright bans (New York, Vermont) to permissive frameworks. State severance taxes on oil and gas production differ significantly. Community choice aggregation programs, allowing local governments to procure electricity on behalf of ratepayers, are authorized in about ten states.
Resources
Federal Energy Regulatory Commission (FERC)
Independent agency regulating interstate energy transmission, wholesale electricity and natural gas markets, and hydroelectric projects.
Energy Bar Association
Professional organization for attorneys practicing energy law, offering publications and educational programs on energy regulation.