DEALING WITH COMPLEX DISPUTES IN THE ENERGY SECTOR
CD: Could you briefly touch upon recent developments in the energy sector – what trends have you seen with regard to commercial disputes in this space?
Vince: The two most significant recent developments in the energy sector in the US are, first, the change in the country’s position from being a net energy importer to net exporter and, secondly, the emphasis on mitigating the effects of climate change. The gas and oil boom of the past few years has already prompted a significant shift in generation resources, and is spurring investment in infrastructure – pipelines, storage, export terminals – to support the trend. Both in response to the economics of gas and to new and impending environmental regulations, coal plants are being retired and coal companies are seeking new markets. Environmental concerns about domestic and foreign energy production are prompting reactions in the US, such as protests over the Keystone XL pipeline, or exports of gas or coal to Asia. There has also been an increase in disputes over rights to water resources necessary for the production of energy, as well as lawsuits related to spills and accidents, from serious incidents such as the Deepwater Horizon oil spill and the natural gas pipeline explosion in San Bruno, California, to issues related to local well-water quality in the vicinity of oil and gas drilling. Patchwork regulatory schemes are also spawning litigation, especially in connection with development of renewable energy resources and natural gas drilling.
Oct-Dec 2013 issue