1. Oil & Gas Awards, March 2 , 2017
Trump’s Energy Policies, Two Months In: Impact on Utica Marcellus Basin—Or Not?
Michael L. Krancer Sr. Counsel, Energy, Blank Rome LLP

3. *
C itizens
A gainst
V irtually
E verything

4. “LINGO”—Leave It In The Ground

5. Where public opinion goes, elected officials and regulators will follow
This slide used with permission from Silent Majority Strategies LLC

6. Political Risk Is No. 1

7. $15.68 million per day due to inadequate infrastructure*
Marcellus/Utica Producers losing
$15.68 million per day due to inadequate infrastructure*
*Average loss per day in 2016; difference between Henry Hub price and Dominion South price. (Source: Silent Majority Strategies LLC)
This slide used with permission from Silent Majority Strategies LLC

8. Pipelines Projects Under Siege
Delayed Projects
Dakota Access (work to begin)
Mariner East 2 (work just started)
Atlantic Sunrise (awaiting PA permits)
Projects in Question
Constitution
Keystone XL
Cancelled Projects
Palmetto
Northeast Direct
This slide used with permission from Silent Majority Strategies LLC

9. President Trump Won’t Solve All Your Problems
Good for the industry, but cannot solve the political problems facing the industry.
Opposition has a rally point.
States are still in control of environmental permitting.
States can’t regulate less than Feds but they sure can regulate more:
GP-5A
Stream Crossing/Encroachment Permitting (Section 105)
Earth Disturbance Permitting (Section 102)
Pending Draft DEP Guidances on Wetlands Evaluation and Mitigation
Interference With Development of Gathering Lines
Subsidies and/or Mandates for Competing Sources

10. President Trump Won’t Solve All Your Problems
President Trump has a big agenda.
Is there room for pipeline build-out?
Competition from coal and nuclear
Trump is sensitive to public opinion. If public opinion moves against the industry, what will Trump do?
Vital to provide political cover for Trump Administration policies and build public support for the industry .

11. Executive Orders (EO) - History & Context
An Executive Order (EO) is a legally binding directive issued by a POTUS to federal administrative agencies.
13,766 EOs issued in history with only Wm. H. Harrison having not issued one.
Lincoln’s Emancipation Proclamation was an EO.
Bush 43 issued 11 EOs in his first 100 days
Obama issued 19 EOs in his first 100 days including several that reversed EOs signed by Bush 43.
Trump has issued 12 EOs so far (42 days in) covering topics such as immigration, crime reduction and public safety.

12. Key Executive Order For Oil & Gas
January 24, 2017 EO Expediting Environmental Reviews and Approvals For High Priority Infrastructure Projects
Covers electric grid, telecommunications, port facilities, pipelines, bridges and highways.
Outlines process for identifying “high priority” infrastructure projects by Governors, any federal executive department head, or Chair of the CEQ.
Chair of CEQ then to “quarterback” priority reviews by federal agencies on projects identified as “high priority.”

13. Follow-On Presidential Memoranda
To Sec’y of Commerce “Regarding Construction of American Pipelines”
Use of materials and equipment made in the USA.
To Sec’y of State, Army and Interior “Regarding Construction of Keystone XL Pipeline”
Invites TransCanada to re-submit its application.
If one submitted, all actions necessary and appropriate to facilitate expedited review will be taken.

14. Follow-On Presidential Memoranda (continued)-- DAPL
To Sec’y of the Army “Regarding Construction of the Dakota Access Pipeline”
Army Corps is to review and approve in an expedited manner as warranted and with conditions if appropriate.
Including the granting of easements.

15. Like Taking Baseball Bat To A Beehive, Blindfolded

16. My Take In Forbes.com
“There Was Way Less To Trump’s Pipeline Order Than Anyone Thought”
Biggest challenge is still public opinion and messaging!
While modern engineering is robust and reliable, our politics are brittle. And therein lies the problem for pipeline supporters. They’ve ignored the political dimension and public opinion aspect of protests.
For too long, the U.S. energy industry has buried its head in the oil sands, ignoring that its projects have become highly controversial and much more about politics than the science, technology or economics behind them.
How the DAPL protesters are handled and whether the energy industry manages to improve its public narrative will determine whether this vital infrastructure build-out moves forward or whether Trump ultimately has to tell the pipeline’s backers, “You’re fired.”

17. Congressional Review Act (CRA) of 1996
Used only once before by Bush 43 in 2001 to rescind the Clinton “ergonomics rule”
Provides that once a rule is killed, no rule that’s “substantially the same form” can ever be enacted.
Stream Protection Rule
Methane Waste Rule
SEC Resource Extraction Rule

18. EPA Rule Freeze
Issued January 26--freezes, for at least 60 days, implementation of 30 rules issued at 11th hour by Obama administration.
Creature of a January 20th Memorandum from the WH instructing agencies to freeze new or pending regulations until the new administration can review them.
Routine for any new administration to issue a “freeze” (both Bush 43 and Obama did the same)
RFS/RINS Frozen.
PHMSA Final Rule: “Operator Qualification, Cost Recovery, Accident and Incident Notification, and Other Pipeline Safety Changes.” (1/23/17)
PHMSA-FRA proposed rule on transport of crude by rail. (7/13/16).

19. Mike Krancer, Sr. Counsel, Energy, Blank Rome LLP One Logan Square 130 North 18th Street | Philadelphia, PA Phone: | Cell: | Fax: |