The House Environmental Resources and Energy Committee is scheduled to meet April 30 to consider House Bill 2154 (Causer-R-Forest), the Conventional Oil and Gas Act to regulate conventional drilling operations based on the original 1984 Oil and Gas Act.

In announcing the meeting in an email Wednesday, Rep. John Maher (R-Allegheny), Majority Chair of the Committee, said, “The vast majority of these abandoned wells are older than any of us but we can not ignore the sad legacy that vents methane 24 hours a day, 7 days a week.  This unabated source of methane has great importance for anyone concerned about greenhouse gas.   

“Last year, the state plugged 4 of these wells.  Yes, only four. 

“The Governor's 2015 Climate Change Action Plan estimates about 350,000 gas wells predate Pennsylvania's regulatory era.  Other estimates expressed by DEP during his term range from 200,000 to 750,000 abandoned wells. No one really knows.  But it's a lot.

“On Monday, the ERE committee will consider legislation that will establish a streamlined bounty program that could see as many as 1,000 wells plugged each year.”

The program referred to is apparently the one on page 36 of House Bill 2154 that would give individuals who voluntarily plug an orphan well the ability to apply to the Commonwealth Finance Authority for a $5,000 payment payable from the Marcellus Legacy Fund or be credited for each plugged well in the form of a permit-fee waiver for any succeeding well permit application.

The provision would provide no new source of funding to plug abandoned wells, instead it would take money away from the environmental restoration programs now funded by the Marcellus Legacy Fund and take permit application revenue away from DEP for running the Oil and Gas Regulation Program.

There are no limits in this bill on the amount of money that could be taken from the Marcellus Legacy Fund or diverted away from DEP for running the Oil and Gas Regulation Program.

[Note: This is a clever provision, much like the amendment made to the severance tax bill in September by the House Environmental Resources and Energy Committee to simply rename the existing drilling impact fee a “severance tax.”  It appears to do something, but actually doesn’t.

[This provision hurts a key regulatory program and the public employees trying to do their jobs in ways no boss in a private company would ever do.

[There was also an October announcement to introduce a Republican Pennsylvania Clean Power Plan that has yet to materialize.

[Hopefully someone will fix this.]

Good Samaritan Program

In January, after discussions with the PA Grade Crude Oil Development Advisory Committee representing the conventional oil and gas drillers, DEP announced a private-sector Good Samaritan initiative to cap abandoned oil and gas wells statewide.

The state Environmental Good Samaritan Act of 1999 protects groups and individuals who volunteer to implement qualifying environmental remediation projects from civil and environmental liability. The Act doesn’t provide immunity for injury or damage that may result from reckless, unlawful, or grossly negligent acts or omissions.

While the Act historically has been used for mine reclamation, DEP first applied it to two oil and gas well projects in 2017. Cameron Energy plugged a well in Warren County that had been discharging crude oil to the ground and nearby streams, and Chemtrade Logistics plugged a leaking gas well in Elk County.

These projects are estimated to have saved DEP $60,000 to $85,000, in addition to administrative cost savings related to contract development and management.

Three more project proposals are currently under review, and DEP welcomes others.

The agency has developed online training to walk volunteers through the process of submitting a project proposal and applying for the liability protection. In addition, the eFACTS environmental database and Oil and Gas Mapping Tool have been updated to provide an inventory of Environmental Good Samaritan project proposals for abandoned wells in Pennsylvania.

Conventional Drilling Bill

On April 11, the PA Environmental Council and Environmental Defense Fund Wednesday sent a letter to the members of the Senate Environmental Resources and Energy Committee expressing their concerns about legislation weakening environmental protection standards for conventional oil and gas drilling about Senate Bill 1088.

Senate Bill 1088 is identical to House Bill 2154.

The legislation, they said, would make Pennsylvania "the only state in the country to walk back protections applied to oil and gas operations."

The text of the letter follows--

The Environmental Defense Fund (EDF) and Pennsylvania Environmental Council (PEC) respectfully submit the following comments on Senate Bill 1088 (P.N. 1546), which we anticipate will come before the Senate Environmental Resources and Energy Committee for a vote early next week. At the start, we wish to express our appreciation to Senators Yaw and Hutchinson for allowing additional time for review and comment on this legislation.

Senate Bill 1088 seeks to revert performance and protection standards for the conventional oil and gas industry, which were modernized with the bipartisan enactment of Act 13 of 2012.

However, even today, that law has yet to be fully implemented by the Department of Environmental Protection (DEP), as the agency was directed by the General Assembly in 2016 to restart their rulemaking for the conventional industry.

It is our understanding that DEP is poised to issue a revised proposal for public comment in the near future.

Senate Bill 1088 would not only reverse protection standards from the 2012 law, it would actually be weaker in several important instances than the original 1984 Oil and Gas Act.

Pennsylvania would have the discreditable distinction of being the only state in the country to walk back protections applied to oil and gas operations – whether conventional or unconventional.

In fact, the way certain provisions are worded in this legislation, this bill could potentially weaken standards applied to unconventional operations as well.

Both EDF and PEC believe that any potential divergence in standards must be based on the practices and technologies employed at a well site, as well as objective risk assessment.

Unfortunately, Senate Bill 1088 is a blunt instrument that fails against both of these metrics. This legislation contradicts leading industry practices as articulated in API standards and recommended practices.

Under Act 13, and as defined in Senate Bill 1088, the fundamental distinction between “conventional” and “unconventional” operations is one based on depth of drilling.

“Conventional” wells can be drilled horizontally, and in many cases are hydraulically fractured at much shallower formations in closer proximity to groundwater – a fact this legislation clearly acknowledges.

In other words, the legal distinction in Pennsylvania is made irrespective to the size of the operator or operation, the practices employed at the well site, or the associated risks involved.

Any law that alters protection standards should only do so where the actual operations at the well site allow.

In our view, any well that employs high volume hydraulic fracturing should be subjected to stringent and uniform control.

Other states follow this distinction for their application of standards – for example, the state of Illinois, which utilizes “high volume horizontal hydraulic fracturing operations”  as a threshold. Pennsylvania should do the same.

Beyond this fundamental problem, there are several other major concerns with Senate Bill 1088 including, but not limited to:

-- Removal of language that requires additional analysis of potential impacts to Public Resources. This language was in the 1984 law, reinforced by Act 13, and validated by the Pennsylvania courts.

-- Removal of any requirement for operators to disclose chemicals used in the fracturing process. Disclosure – for both conventional and unconventional operators – is currently required practice in Pennsylvania as well as in virtually all other jurisdictions in the United States, and it should remain that way.

-- Removing storage, spill, and leak prevention provisions, despite the fact that conventional sites present spill and leak threats similar to unconventional operations. In fact, this legislation provides express exemptions from the state’s Storage Tank and Spill Prevention Act, and dramatically weakens spill and leak reporting requirements.

-- Exempting certain existing wastewater treatment facilities from state water protection requirements, even though those protections have been applied for years.

-- Weakening protections for impacted drinking water supplies, including failure to ensure that, in all instances, replacement supplies meet the standards of the Safe Drinking Water Act.

-- Reducing setback provisions from homes, buildings, and surface waters.

-- Weakening well integrity standards that are critical for groundwater protection.

-- As was already invalidated by the Pennsylvania Supreme Court in 2013, attempting to preempt local ordinances that address issues associated with oil and gas activities.

-- Maintaining woefully inadequate bonding and financial assurance requirements, which leaves Pennsylvanians on the hook for costly remediation work in the decades to come.

Conclusion

Senate Bill 1088 is a wholesale weakening of necessary protection standards; standards that are already the law in Pennsylvania, and that are accepted common practice in the industry and other oil and gas producing states.

It also contradicts recent decisions of the Pennsylvania courts that have upheld protections on both statutory and constitutional grounds.

For these reasons, we strongly urge you to oppose this bill.

Thank you for your consideration.

Sincerely,

Andrew Williams

Director, Regulatory and Legislative Affairs, U.S. Climate and Energy

Environmental Defense Fund

John Walliser

Senior Vice President, Legal & Government Affairs

Pennsylvania Environmental Council

Click Here for a copy of the letter.

The meeting will be held in Room G-50 of the Irvis Building starting at 12:30. Committee meetings are typically webcast through the House Republican Caucus website.

The bill is also scheduled for action by the full House and is expected to move quickly.

Rep. John Maher (R-Allegheny) serves as Majority Chair of the House Environmental Committee and can be contacted by calling 717-783-1522 or sending email to: jmaher@pahousegop.com.  Rep. Mike Carroll serves as Minority Chair and can be contacted by calling 717-787-3589 or sending email to: mcarroll@pahouse.net.

NewsClips:

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Related Stories:

PEC, EDF: Conventional Oil & Gas Bill Will Reverse, Weaken Environmental Protection Standards For Fracking

PennFuture: Senate Bill 1088 Would Roll Back Conventional Drilling Rules To 1984 Levels

DEP Launches Good Samaritan Outreach To Promote Abandoned Oil & Gas Well Plugging Projects

[Posted: April 26, 2018]

4/30/2018