Not only has the Marcellus Shale drummed up significant legal work for litigators, land use and transactional attorneys alike, it has created movement in the lateral market as firms look to build practices catering to the oil and gas industry’s interest in the natural gas reserves within the shale.
The most recent example comes from Reed Smith in Pittsburgh, where the firm added partner Dwight Howes to its corporate and securities practice. Howes joined from McGuire Woods where he had developed a focus on advising clients about legal issues related to the Marcellus Shale.
Howes’ practice includes a focus on supply chain management issues; energy, including coal and natural gas transactions, purchase of uranium concentrates, conversion and enrichment services and fuel fabrication agreements for nuclear power plant operators; power plant construction projects; mergers and acquisitions; and corporate governance work, among other areas.
“Dwight’s extensive oil and gas background, coupled with his knowledge of the Marcellus Shale and its potential, will afford current and prospective clients a unique benefit when making decisions about their regional business growth strategies related to the shale’s development,” George Stewart, managing partner of Reed Smith’s Pittsburgh office, said in a statement.
Before joining McGuire Woods in 2000, Howes was deputy general counsel with Consolidated Natural Gas Co., which was acquired by Dominion Resources.
Reed Smith has about a half a dozen lawyers, including Howes, who now focus on Marcellus Shale-related work. They span the firm’s Pittsburgh, Philadelphia and New York offices and are housed within several different practice groups including corporate and securities, litigation, energy, environmental, regulatory enforcement and export/trade work.
Most of the work so far has been on the litigation side, with Pittsburgh partner Kevin C. Abbott leading up that component along with litigation and environmental law partner Nicolle R. Snyder Bagnell, who has blogged about the Marcellus Shale on Reed Smith’s Environmental Law Resource blog. Partner Ronald W. Frank heads up the corporate component, representing clients in joint ventures and mergers related to the shale.
Abbott said the firm’s focus in the last few years has been in litigation relating to royalty disputes and “what it means to own what”; general advice related to leasing and helping Oklahoma- and Texas-based clients adapt their agreements to Pennsylvania law; and environmental and regulatory work related to permitting, the siting of wells and dealing with objections to well placement.
Abbott has been an oil and gas lawyer focused on the Appalachian basin for 30 years and said he has never been so busy, which is part of the reason for growing the group.
As the industry matures, Abbott said clients will need more generalized legal help, including employment law and assistance when contract disputes arise.
“I just think that as the industry matures in this state it will bring with it sort of a fuller range of legal issues,” Abbott said, adding however that “I don’t think the litigation is going to go away any time soon.”
Reed Smith isn’t the only firm to add lawyers in an effort to add client work from Marcellus Shale activities.
Lansdale, Pa.-based Hamburg Rubin Mullin Maxwell & Lupin created a gas leasing and development practice group last December with the addition of former Wolf Block environmental lawyer Kermit L. Rader.
The new practice was designed to assist landowners whose property sits on gas reserves with the process of securing leasing and development contracts with gas companies.
Just last month Pittsburgh-based personal injury lawyer David C. Zimmaro created Marcellus Lease Lawyers, a network of Pennsylvania attorneys that came together to represent landowners in negotiating leases for Marcellus Shale gas, oil and minerals.
“Don’t be fooled … the gas company is NOT on your side!,” the network’s Web site warns landowners.
But there are several firms, like Reed Smith, on the side of oil and gas companies, with the larger firms typically representing the corporations and the smaller firms representing landowners.
Morgan Lewis & Bockius said it is involved with multiple projects related to the shale that span at least four offices and four practice groups — business and finance, environmental, real estate and tax. Energy transactions practice leader David Asmus said the work includes a couple of acquisition and divestiture transactions as well as attorneys advising clients on Pennsylvania legal and regulatory issues relating to shale development.
Perhaps the largest player in the Marcellus Shale legal arena, at least in terms of state firms, is K&L Gates.
The firm, led by litigation partner Walter Bunt Jr., represents a consortium of natural gas companies known as the Marcellus Shale Coalition. He has been very active on behalf of those clients in the state’s courts, litigating gas extraction cases.
He told The Legal Intelligencer last year the litigation issues range from contested leases to how the Department of Conservation and Natural Resources can control oil and gas drilling on the property it controls. Aside from litigation, Bunt said other legal work that could be derived from the shale includes regulatory and enforcement matters, policy issues involving the interplay between state and local tax structures and environmental and land use work.
Bunt had said the firm’s merger with Texas-based Hughes & Luce gave it a leg up in natural gas work. That firm had experience with the Barnett Shale beneath Fort Worth and several Texas-based companies have expressed interest in Pennsylvania’s natural gas industry.
This week Bunt told The National Law Journal, a Legal Intelligencer affiliate, that K&L Gates currently has about 25 lawyers working on matters related to the Marcellus Shale. He said the work has really taken off in the last five years and presents long-term business opportunities in the region.
Law firms aren’t the only businesses looking to add resources thanks to the work generated by the shale. New Duquesne University Law School Dean Ken Gormley said recently that he is actively exploring adding an energy law course to the curriculum “because [the law school is] sitting on top of the Marcellus Shale deposits here in Western Pennsylvania and that will continue to create business opportunities for lawyers in this region.”