Brownstein was privileged to sponsor this year’s Rockies Petroleum Conference, hosted by the Petroleum Association of Wyoming, in Laramie, Wyoming, on Aug. 21–23, 2024.
During the Carbon Innovation Network portion of the conference, Russ Sullivan and Mark Warren, both shareholders in Brownstein’s Washington, D.C., office, explored the carbon-capture benefits under the tax code. Their presentation provided an overview of the section 45Q carbon-capture tax credit, which was expanded and modified in the 2022 Inflation Reduction Act (IRA). The credit is a long-standing incentive that enjoys bipartisan support in Congress and is likely to remain largely unchanged in next year’s debate over expiring tax provisions in the 2017 Tax Cuts and Jobs Act.
Russ and Mark reviewed the significantly increased credit amounts and the new prevailing-wage and apprenticeship requirements that companies must meet to claim the maximum credit. The IRA also provides a host of other energy-related tax incentives, such as an investment tax credit for electricity production, which they outlined for conference participants. The segment concluded with a discussion of the new options for monetizing the section 45Q credit through an elective-payment refund or by transferring the credit in the developing marketplace for energy tax credit sales.
Affie Ellis, a shareholder in Brownstein’s Cheyenne, Wyoming, office, also provided a litigation update to conference attendees on the status of Center for Biological Diversity v. Dep’t Interior, a case pending before the U.S. Court of Appeals, D.C. Circuit. In June of 2022, several nongovernmental organizations challenged the federal Bureau of Land Management’s issuance of more than 4,000 applications for permits to drill (APDs) in New Mexico’s Permian Basin and Wyoming’s Powder River Basin alleging violations of the National Environmental Policy Act (NEPA), the Endangered Species Act (ESA) and the Federal Land Policy and Management Act (FLPMA). The Petroleum Association of Wyoming, represented by Ellis and fellow Brownstein shareholder Eric Waeckerlin, intervened to defend the approved APDs. Several defendant-intervenors filed a motion to dismiss arguing the plaintiffs failed to establish standing. On Nov. 11, 2023, the U.S. District Court, D.C. District granted the motion and plaintiffs subsequently appealed. Approximately one-fourth of the challenged APDs are located in Wyoming.
