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BakerHostetler provides comprehensive legal services tailored to the dynamic and rapidly evolving field of carbon capture, utilization and storage (CCUS). Our team of experienced attorneys combines a deep understanding of energy, environmental and corporate law to deliver results-driven solutions for clients.


Site Selection, CCUS and Environmental/Natural Resources Project Permitting/Defense

  • Working with technical staff and outside consultants on the development of Class VI wells and related permit applications to ensure that applications contain information necessary for the Environmental Protection Agency (EPA) to provide efficient and prompt approvals. This advice includes, but is not limited to, “lessons learned” from prior interactions with the EPA, comments and feedback from the various stakeholder groups in which we participate, environmental justice considerations, and our significant experience in the successful permitting and development of projects.
  • Representing a company with respect to its project for the transportation and storage of carbon dioxide, including permitting, right-of-way negotiation and acquisition; Texas Railroad Commission applications, approvals and hearings; and eminent domain proceedings.
  • Involved in all aspects of the site selection process related to the development of a $5 billion manufacturing facility and associated lateral projects to be located in the southern part of the U.S., including greenfield and brownfield sites, and addressing all risks presented by each site, including, but not limited to, environmental, natural resources (endangered species), cultural resources, water quality, air quality, local approvals, energy availability (gas, hydrogen and power), aviation and water supply. Attend and actively participate in executive-level meetings associated with the site selection process.
  • Successful permitting of a manufacturing facility project in Arkansas (state and federal), including all associated natural and cultural resource permitting and National Environmental Policy Act (NEPA) requirements, and successful defense of an air permit in state administrative proceedings as well as in the U.S. District Court for the District of Columbia, the Arkansas District Court and the U.S. Court of Appeals for the 8th Circuit.
  • Successful permitting of a silicon metal mill in Mississippi, including successful defense of an air permit in the U.S. District Court, Mississippi and the 5th Circuit U.S. Court of Appeals.
  • Successful permitting and restart of the former General Motors plant in Lordstown, Ohio, to produce electric vehicles, including the development of environmental risk management considerations to ensure that the project company was protected from preexisting environmental liabilities.
  • Currently managing and supervising environmental permitting and related development of a $3.5 billion manufacturing facility, including all environmental media, and working with the client and its compliance teams to develop and implement its environmental, health and safety programs.
  • Lead counsel for an oil and gas producer’s efforts to develop a master development plan for a federal exploratory unit and the attendant pipeline infrastructure on public and private lands in Gunnison County, Colorado. Performed a review of the Bureau of Land Management’s NEPA analysis and prepared technical comments on the legal and operational aspects of the Draft Environmental Impact Statement.
  • Assisted with grant applications to the Department of Energy pertaining to transportation and sequestration of carbon.

CCUS Project Development

  • Assisted a venture in a capital raise for a multistate CCS project involving a wide range of point source emitters, pipeline transportation and multisite sequestration.
  • Advised on state regulations and legislation pertaining to sequestration, including pore space ownership, unitization, liability and indemnity, as well as permitting requirements.
  • Advised a CCS company on the optimal structure of subsidiary operating entities for the purposes of state and federal permitting and tax benefits.
  • Advised a CCS developer on necessary terms for inclusion in form service and operations agreements.
  • Drafted and revised the terms of a Carbon Dioxide Purchase and Supply Agreement for a CCS project.
  • Advised operating company on state and federal regulations pertaining to transport of carbon dioxide in connection with sequestration project.

Pore Space Litigation and Analysis

  • Won a first-of-its-kind victory for a major energy company on the issue of whether a lessee must compensate a surface owner when using pore space in producing formations during enhanced oil recovery operations. On Jan. 27, 2023, the 8th Circuit issued a decision of first impression benefiting enhanced oil recovery and CCUS projects.
  • Representing a major energy company in a dispute over pore damage and the use of space in North Dakota. Tried the case to verdict. Plaintiff obtained a de minimis verdict, which is currently on appeal.
  • Represented a major energy company in a case of first impression over statutory damages for the use of pore space in South Dakota, winning both in the trial court and on appeal to the federal 8th Circuit Court of Appeals.
  • Advise CCUS developers on state regulations relating to pore space in connection with the site selection process and develop strategies to manage teams, as necessary, to secure those rights.
  • Advising a major energy company on legislative strategy concerning pore space ownership.

Tax

  • Advising a large agricultural and industrial company regarding Section 45Q.
  • Advised a biomass energy producer on tax and economic development incentives relating to a biomass fuel production facility.
  • Advising on strategies and structures for facilitating financing transactions while optimizing the tax results. Structures frequently involve the monetization of tax credits and the participation of tax credit investors, as well as the involvement of other governmental subsidies, and the integration of these along with various additional sources of funding in the capital stack for a given project. Examples include renewable energy, steel, auto manufacturing and CCUS projects.
  • Advised an ethanol producer on 45Q tax credit matters attendant to the proposed development of CCUS projects in the Midwest.
  • Working with the U.S. parent of a multinational corporate group that would like to invest in renewable energy credits, guiding and representing it through the process of meeting the IRA’s provisions involving the one-time transfer of renewable energy credits.
  • Advise a multinational manufacturer of various solar-related eligible components on matters relating to IRA investment tax credits and the operational issues that they present to the manufacturer.
  • Advising a project sponsor on corporate, tax and securities regulation matters in its process of developing solar and energy storage facilities.
  • Advising a joint venture on the application of 45Q credits and the commercialization of 45Q credits for purposes of a multiparty, multistate development project.
  • Defending many historic tax credit transactions, solar tax credit transactions and other tax credits and related transactions in IRS audits, at IRS appeals and in tax litigation.

Climate Change Litigation

  • Represented one of the parties in successfully challenging the EPA’s authority to limit carbon emissions from power plants in the Supreme Court case West Virginia et al. v. Environmental Protection Agency. The 6-3 ruling immediately affects the EPA, but ramifications of this decision will reverberate throughout the federal government, opening the door to restricting any federal agency from enacting policies not expressly granted by federal law. The Supreme Court specifically adopted BakerHostetler’s position on the major questions doctrine.
  • Retained to draft comments and prepare a challenge to a proposed rule issued by the EPA in response to the Supreme Court’s decision in West Virginia that would require coal-fired power plants to either shut down or implement CCUS to reduce carbon dioxide emissions, in response to a recent proposal by the EPA to establish greenhouse gas limits on power plants in the aftermath of West Virginia et al. Prepared extensive public comments on the proposed rule (submitted Aug. 8, 2023), which would serve as the basis for a new legal challenge if the rule is finalized in its current form.
  • Representing the New Mexico Chamber of Commerce, the largest business advocacy group within the state, in a suit involving a high-profile challenge brought on behalf of environmental special interest and Indigenous groups to oil and gas development in New Mexico. Plaintiffs contend that the state of New Mexico’s legislative, regulatory and enforcement framework is inadequate to satisfy state officers’ alleged obligation under the New Mexico Constitution to prevent pollution. The plaintiffs seek, among other relief, an order prohibiting the defendants from “authorizing new oil and gas production until the defendants have established and implemented a statutory, regulatory and enforcement framework in a manner consistent with their constitutional dut[ies].”

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