By Brooks Igo
Staff Writer for The Texas Lawbook
Haynes and Boone added energy lawyer Walter Keneally to its Houston office last week.
The former Bracewell & Giuliani partner says he was recruited by Haynes and Boone to bolster its power projects practice, particularly in renewable energy, and to add bench strength to the energy practice group in areas such as the natural gas midstream and industrial/chemical projects practices.
“Over the years, Haynes and Boone has built a solid reputation for helping clients in all facets of energy transactions from exploration and production to alternative energy,” Buddy Clark, head of the firm’s energy practice group said in a statement. “Walter’s experience, particularly with midstream clients, really rounds out our resource base available to clients. It’s a very nice fit.”
The 1991 University of Houston Law Center graduate says he and his partners predict significant growth in the next decade in two areas that are likely to change his practice. First, he says, the shale boom is fueling the growth of Gulf Coast chemical industry and other facilities that utilize large amounts of natural gas as feedstock, including liquefied natural gas (LNG).
“As companies build new facilities, they will require a lot more energy in the form of electricity and steam,” he said.
Second, he says they are seeing a growing demand for energy development, particularly renewable power and LNG, in Latin America.
Though it is a “tired refrain,” the threat of future changes in federal regulation is the most significant legal challenge he said is facing his clients and is limiting investment in industries like upstream oil and gas production (hydraulic fracturing, deep water drilling), power generation (proposed clean air regulations, nuclear safety) and coal mining.
“While we all might appreciate adopting the cleanest way to produce consumer goods in all cases, other countries need not agree to play by our rules, and the threat of costly new standards in these areas pushes investment overseas,” he said. “If we want to maintain and continue to improve our world-beating standard of living, we should overcome the NIMBY attitude that pervades in many states around the country.”
Additionally, Keneally said his clients in the renewables sector are struggling with the temporary nature of the production tax credit (PTC) for wind power generation. He expects that the wind power industry will continue its uneven pace of development if the PTC is not extended for longer periods than one year intervals.
On the natural gas side, one hot issue Keneally points to is the debate about exports of natural gas through U.S.-based LNG terminals.
“Proponents of exporting LNG point to the significantly higher prices available on the world market as against the U.S. market and claim there is so much gas that depressed U.S. prices will not be much affected,” he explains. “Opponents of LNG exports argue that shipping natural gas overseas will cause prices to rise in the U.S. market, staunching the expected tremendous growth of the U.S. chemicals industry and resulting in a significant loss of investment and jobs in the U.S.”
One of the biggest deals Keneally said he has worked on was when he was sent to New York for “a couple of days” as a young associate to be the firm’s lawyer on the ground for the closing of the financing for construction of a municipal waste-to-energy facility that had been developed by their client. Two days turned into 20 and, while he had the support of partners back in Houston, he said he was expected to close the deal.
“Not only did I have to go shopping for suits and ties, but I did not get to see much of the Big Apple,” he said. “It was a baptism of fire, but I learned quite a bit about project finance deals.”