The 2024 Liskow CCS Legislative Update

The Louisiana Legislative Session for 2024 officially began on March 11.  Nine bills have already been filed on CCS.

These bills have potentially far-reaching implications for CCS projects. Most of the bills either target CCS projects in specific areas or seek to eliminate or place significant hurdles on CCS development generally.  One bill (HB 696 by House Chairman Geymann) authorizes the unitization of CCS reservoirs by the Commissioner upon application of the storage operator.

All bills were filed in the House, and all of them were referred to the House Natural Resources Committee, except one (HB 73) which was referred to the House Municipal Committee.  No hearing dates have been set in either committee.  The deadline for filing bills is April 2.

A summary of each bill can be found here. 

Liskow will share regular updates throughout the Louisiana Legislative Session about CCS legislation.

The Louisiana House Committee is scheduled to hear multiple bills concerning Carbon Capture and Storage (CCS) this Thursday, April 4. Among them, five bills aim to regulate or restrict CCS activities and will be heard by the House Natural Resources & Environment Committee at 9 A.M. The proposed legislation covers a range of issues, from requiring CCS projects to comply with local ordinances to placing moratoriums on certain areas and imposing additional requirements on CCS projects. 

Here’s a brief overview of each bill:

1. HB 276 (Carter), requires that CCS projects comply with local land use and zoning ordinances.
2. HB 280 (Coates), prohibits the permitting of any structures which protrude above the surface of Lake Maurepas and Lake Ponchartrain.
3. HB 289 (Mack), prohibits Class VI injection wells in Caney Lake, Lake Maurepas, Lake Ponchartrain and Toledo Bend Reservoir.
4. HB 389 (Mack), places a moratorium on CCS below Lake Maurepas and the Maurepas Swamp Wildlife Management Area.
5. HB 516 (Mack), imposes additional requirements and restrictions on CCS projects, including emergency response plans, community notification systems, maps of CCS facilities, locations of CCS facilities, and groundwater monitoring.

Liskow will continue to share regular updates throughout the Louisiana Legislative Session about CCS legislation.

This has been a great week for Carbon Capture and Storage (CCS) in Louisiana. The first round of bills on CCS went forward yesterday, April 4. Four bills aiming to regulate or restrict CCS activities were scheduled by the House Natural Resources & Environment Committee and did not pass. One moved forward with amendments to the House floor.

DEFEATED/DEFERRED:

• HB 276 (Carter), requires that CCS projects comply with local land use and zoning ordinances.  
• HB 280 (Coates), prohibits the permitting of any structures which protrude above the surface of Lake Maurepas and Lake Ponchartrain.  
• HB 289 (Mack), prohibits Class VI injection wells in Caney Lake, Lake Maurepas, Lake Ponchartrain and Toledo Bend Reservoir. 
• HB 389 (Mack), places a moratorium on CCS below Lake Maurepas and the Maurepas Swamp Wildlife Management Area. 
• MOVED TO HOUSE FLOOR WITH AMENDMENTS:HB 516 (Mack), imposes additional requirements and restrictions on CCS projects, including emergency response plans, community notification systems, maps of CCS facilities, locations of CCS facilities, and groundwater monitoring.   While the bill moved to the floor, committee members asked the author to consider additional amendments when the bill comes up for debate on the floor, and it is anticipated that there will be much discussion about additional amendments to the bill going forward.

The Second Round of CCS bills are scheduled for hearing before the same House Committee on Tuesday, April 9 – with seven bills on the agenda.  Several of those bills are expected to be voted out of committee, with amendments.  Stay tuned for a blog update on Monday morning with a forecast of that hearing.

The Louisiana Legislative Session continues to address Carbon Capture and Storage (CCS) with several bills up for discussion by the Committee on Natural Resources tomorrow, Tuesday, April 9, at 9 a.m. The proposed bills touch upon unitization, eminent domain, liability concerns, and revenue dedication of CCS within the state.

The descriptions of the five bills can be found below:

• HB 169 (Carter), provides relative to liability and damages resulting from carbon sequestration
• HB 492 (Geymann), provides relative to eminent domain
• HB 696 (Geymann), authorizes unitization for carbon dioxide sequestration
• HB 729 (Carter), removes eminent domain authority for carbon dioxide sequestration
• HB 774 (McCormick), provides relative to eminent domain and compensation for mineral owners
• HB 934 (LaCombe), provides for the dedication of revenue from carbon dioxide sequestration on state lands and water bottoms
• HB 937 (Geymann), provides relative to landowner liability for carbon dioxide sequestration

We’ll provide further insights into the outcomes and implications in an upcoming blog post.

Three bills relating to Carbon Capture & Storage (CCS) projects sponsored by Chairman Geymann passed favorably out of the Louisiana House Committee on Natural Resources and Environment. The description of those bills can be found below:

• HB 492 by Chairman Geymann was originally filed to make a limited grammatical change to the eminent domain provision for CCS projects, but served as a placeholder bill for Chairman Geymann to make amendments during committee.  The amendments to HB 492 included important clarifications for eminent domain relative to transportation for CCS projects, particularly for pipeline companies.  As amended, HB 492 sets out eminent domain authority for transportation projects related to CCS and provides a clear procedure for obtaining that eminent domain authority.  Conversely, HB 492 as amended removes existing eminent domain authority for storage operators relative to pore space rights, which is being replaced by unitization as set forth in another Chairman Geymann bill, HB 696.
• HB 696 by Chairman Geymann creates the authority for unitization of CCS reservoirs, which is currently not allowed in Louisiana law for CCS projects.  HB 696 follows a similar procedure for unitization which has historically existed in Louisiana for oil and gas projects.  Under HB 696,  unitization will be done by the Commissioner of Conservation upon application of a CCS operator.   Notice and hearing procedures are included, plus a requirement that a minimum of 75% of pore space owners must be agreeable to unitization as a prerequisite to the application.  All pore space owners who have not already entered into a contract with the storage operator will be compensated equitably with other members of the unit.  HB 696 provides the Commissioner with authority to promulgate regulations to establish the fair and equitable compensation schedule.
• HB 937 by Chairman Geymann provides that landowners, by the mere fact of being landowners, cannot be held liable for any actions related to CCS projects on their property.  HB 937 does not override any contractual obligations which might exist.

In addition, two other bills also regarding CCS projects within the state will be heard later this week. The description of those bills can be found below:

• HB 934 by Rep. Lacombe seeks to correct an unintended consequence from HB 571 last year which intended to direct 30% of revenue from CCS projects on state owned to the local governments but has been interpreted to exclude revenue sharing with local governments on CCS projects on state property operated by the Department of Wildlife and Fisheries.  HB 934 passed out of committee.
• HB 774 by Rep. McCormick sought to provide for compensation for mineral rights following pore space expropriation.  HB 774 was deferred but Rep. McCormick may request a study of the issue.

The next step will be for the bills to be heard on the House Floor, so stay tuned for more updates as they pass through.  

Three Carbon Capture & Storage (CCS) bills sponsored by Chairman Geymann are scheduled for a vote on the House Floor this afternoon: 

• HB 492 defines eminent domain authority for pipeline transportation related to CCS and provides a clear procedure for obtaining that eminent domain authority.  HB 492, however, removes existing eminent domain authority for storage operators relative to pore space rights, which is being replaced by unitization as set forth in another Chairman Geymann bill, HB 696.
• HB 696 by Chairman Geymann creates the authority for unitization of CCS reservoirs, which is currently not allowed in Louisiana law for CCS projects.  HB 696 follows a similar procedure for unitization which has historically existed in Louisiana for oil and gas projects.  Under HB 696,  unitization will be done by the Commissioner of Conservation upon application of a CCS operator.   Notice and hearing procedures are included, plus a requirement that a minimum of 75% of pore space owners must be agreeable to unitization as a prerequisite to the application.  All pore space owners who have not already entered into a contract with the storage operator will be compensated equitably with other members of the unit.  HB 696 provides the Commissioner with authority to promulgate regulations to establish the fair and equitable compensation schedule.
• HB 937 by Chairman Geymann provides that landowners, by the mere fact of being landowners, cannot be held liable for any actions related to CCS projects on their property.  HB 937 does not override any contractual obligations which might exist.

Two additional CCS bills will also be heard on the House floor this afternoon:

• HB 934 by Rep. Lacombe corrects an unintended consequence from HB 571 last year, which intended to direct 30% of revenue from CCS projects on state owned to the local government but has been interpreted to exclude revenue sharing with local governments on CCS projects on state property operated by the Department of Wildlife and Fisheries. 
• HB 516 by Rep. Mack imposes additional requirements and restrictions on CCS projects, including emergency response plans, community notification systems, maps of CCS facilities, locations of CCS facilities, and groundwater monitoring.  The bill received a long critique during House Committee before being advanced to the House floor, with the expectation by the committee members that the bill would receive significant amendments on the House floor.  

Stay tuned for further updates as these bills pass through.

The Louisiana Legislative 2024 Regular Session has officially come to a close and five Carbon Capture & Storage (CCS) bills were passed. The bills create a comprehensive legal framework for CCS projects, including clarifying eminent domain authority for CO2 pipelines, establishing unitization procedures for CCS reservoirs, providing liability protections for landowners, adjusting revenue sharing for local governments, and enhancing groundwater monitoring and community notifications. The passing of these bills represents a major step forward for CCS initiatives in Louisiana. The bills are detailed as follows:

• HB 492 expressly provides eminent domain authority for pipeline transportation of carbon dioxide for CCS projects. HB 492 also provides a clear procedure for when and how that eminent domain authority can be obtained from the State of Louisiana, Department of Energy and Natural Resources, Office of Conservation (“DENR”). Prior to HB 492, Louisianaʼs expropriation statute was unclear as to whether eminent domain authority existed at all for pipelines relating to CCS projects, and if it existed, it was also unclear as to what approval was needed from the DENR to exercise that authority. While expressly providing and clarifying eminent domain authority for CCS transportation, HB 492 however removes existing eminent domain authority for storage operators relative to acquisition of pore space rights, which is being replaced by unitization as provided in a separate bill, HB 696, which also passed the legislature.

• HB 696 creates the authority for unitization of CCS reservoirs, which is currently not allowed in Louisiana law for CCS projects. HB 696 follows a similar procedure for unitization which has historically existed in Louisiana for oil and gas projects. Under HB 696, unitization will be done by the Commissioner of Conservation upon application of a CCS operator. Notice and hearing procedures are included, plus a requirement that a minimum of 75% of pore space owners must be agreeable to unitization as a prerequisite to the application. All pore space owners who have not already entered into a contract with the storage operator will be compensated equitably with other members of the unit. HB 696 provides the Commissioner with authority to promulgate regulations to establish the fair and equitable compensation schedule.

• HB 937 provides that landowners, by the mere fact of being landowners, cannot be held liable for any actions related to CCS projects on their property. HB 937 does not override any contractual obligations which might exist.

• HB 934 corrects an unintended consequence from HB 571 last year, which intended to direct 30% of revenue to local governments which share geographic boundaries on CCS projects on state property. HB 571 from last year had been interpreted to exclude revenue sharing by local governments on CCS projects on certain state property, including property operated by the Department of Wildlife and Fisheries.

• HB 516 imposes a semi-annual groundwater monitoring report and requires additional community notifications relating to emergency preparedness plans, receipt of permits, and maps/locations of CCS facilities.

The passage of these five bills highlights Louisiana’s commitment to innovation and sustainability and equips the State to lead the way in Carbon Capture & Storage projects.