RRC to Open Comment Period on Draft Chapter 1 Amendments

By: Michael K. Reer

On March 17, 2017, the Texas Railroad Commission will open a public comment period on a proposal to simultaneously repeal and adopt several subchapters in 16 Texas Administrative Code Chapter 1. According to the RRC memorandum accompanying the rule proposal, RRC staff propose to repeal and replace Chapter 1 to reorganize and update certain rules in order to clarify current RRC practice and procedures and to reflect certain statutory changes. The changes to Chapter 1 will likely impact the procedure used in contested case proceedings in front of RRC hearing examiners.

The public comment period will be open from March 17, 2017 until May 1, 2017.
Thursday, March 09, 2017

PA Wells, Gas Production Increase

By: Michael K. Reer

On March 2, 2017, the Pennsylvania Independent Fiscal Office released its 2016 4th Quarter Natural Gas Production Report. The IFO found that production of natural gas increased 6.8% in Pennsylvania in 2016. Pennsylvania operators drilled just 504 horizontal wells in 2016, the lowest number since IFO tracking began in 2011. Despite the low number of spud wells, IFO found significant signs of an industry rebound. For example, the number of wells spud by quarter reached a low point in the second quarter of 2016 (72) before noticeably rebounding in the third (146) and fourth (176) quarters. Moreover, the number of spud but not completed wells fell 5.1% in 2016 as operators completed wells drilled in prior years. Also, production from wells spud in 2014 began declining in 2016, by nearly 2%, which may incentivize operators to drill additional wells.

Susquehanna and Washington counties were the top producing counties in 2016, followed by Bradford, Greene, Lycoming, Wyoming, Tioga, Butler, Sullivan, and Fayette. The Commonwealth currently trails only Texas in domestic natural gas production.

The Pennsylvania Department of Environmental Protection announced March 3, 2017 that the Department has launched an iPad app for electronic field inspections at oil and natural gas production sites. The app will replace paper and clipboard inspections and allow operators to receive inspection results concerning erosion and sedimentation, waterways encroachment, waste management, and spill cleanup in a more timely fashion.
Wednesday, March 08, 2017

USGS Releases PA Test Results

By: Michael K. Reer

On March 6, 2017, the U.S. Geological Survey released the test results of 75 private drinking water wells in Lycoming County, in north-central Pennsylvania. USGS found that water from most of the sampled wells contain concentrations of radon that exceed a proposed, non-binding health standard for drinking water and that some wells contain concentrations of arsenic or methane that exceed existing drinking water standards.

USGS states in its press release that the tests were carried out in 2014, in part, to assess the natural characteristics of local groundwater and the potential effects of land uses, including natural gas production, on local water supplies. Significantly, USGS found that water wells near unconventional development were of similar quality to water wells previously sampled in Wayne County – where unconventional development is not permitted.

Pennsylvania does not have comprehensive regulations governing the drilling and maintenance of private drinking water wells. The relatively high number of naturally contaminated water wells in the Commonwealth highlights the importance of conducting comprehensive water quality sampling prior to unconventional development.
Tuesday, March 07, 2017

Colorado Report Finds Low Risk of Health Effects


In February 2017, the Colorado Department of Public Health and Environment issued an “Assessment of Potential Public Health Effects from Oil and Gas Operations in Colorado.” The Health Assessment Report concluded that, based on currently available air monitoring data, “the risk of harmful health effects is low for residents living near oil and gas operations.” Moreover, the assessment found that studies of populations living near oil and gas operations provide only “limited evidence of the possibility for harmful health effects,” which would need to be confirmed or disputed with “higher quality studies.”

According to the executive summary accompanying the assessment, the assessment was undertaken in response to published papers that have outlined “the potential chemical and non-chemical hazards from oil and gas operations.” The assessment notes that studies evaluating the relationship between living near oil and natural gas operations and the potential for certain adverse health effects have been widely publicized and have “led to heightened public and policy-maker concerns about whether or not harmful health effects occur in people living near oil and gas operations.” As these studies continue to develop, oil and natural gas operators may see an uptick in resident concerns regarding the alleged health effects of unconventional development. However, as the Colorado assessment makes clear, thus far the published literature has not provided concrete evidence that unconventional development is related to negative health outcomes.
Monday, March 06, 2017

EPA Withdraws ICR for Oil and Gas Operators


On March 2, 2017, the U.S. Environmental Protection Agency issued notice that the agency is withdrawing its requests that owners and operators in the oil and natural gas industry provide information on equipment and emissions at existing oil and natural gas facilities. Upon publication in the Federal Register, the notice will formally withdraw the Information Collection Request issued by EPA in 2016 to more than 15,000 owners and operators in the oil and natural gas industry.

The ICR was comprised of two parts, an “operator survey” that requested basic information on the numbers and types of equipment at onshore oil and gas production facilities and a “facility survey” that requested detailed information on sources of methane emissions and emissions control devices or practices.

EPA states in the notice that the “withdrawal is occurring because EPA would like to assess the need for the information that the agency was collecting through these requests, and reduce burdens on businesses while the Agency assesses such need. This also comes after the Agency received a letter on March 1, 2017 from nine state Attorneys General and the Governors of Mississippi and Kentucky, expressing concern with the burdens on businesses imposed by the pending requests.”
Friday, March 03, 2017

USGS Releases 2017 Induced Seismicity Forecast


On March 1, 2017, the U.S. Geological Survey released an updated hazard map that forecasts the likelihood of induced seismic events for the coming year. This is the second year that USGS has published an induced seismicity forecast. Previously, the agency only projected naturally occurring seismic events and identified “induced seismicity zones.” According to USGS, the overall seismic hazard for 2017 is lower than that forecasted in 2016. USGS attributes the decrease in induced seismic events to an overall decrease in oil and natural gas wastewater injection. USGS uses induced seismicity data from the previous 12 months to project induced seismic events over the coming year.

In shale basins of note:

Texas (including Permian, Eagle Ford, Barnett, and Haynesville):

In 2016, USGS projected that parts of the Barnett shale had a 5% chance of experiencing an induced seismic event. In 2017, USGS projects that, aside from a small portion of the Permian, Texas has a less than 1% chance of experiencing an induced seismic event. USGS has identified a small area southwest of Odessa as having a slightly elevated chance (1%-2%) of experiencing an induced seismic event.

Appalachia (including Marcellus and Utica):

Ohio, Pennsylvania, and West Virginia continue to have a very small chance of experiencing induced seismicity. The 2016 model identified Appalachia as having a less than 1% chance of experiencing an induced seismic event, but noted that Ashtabula and Youngstown, Ohio were two induced seismicity zones that could impact future forecasts. Both zones remained quiet throughout 2016.

Rockies/Upper Midwest (including Bakken, Denver, and Pierre):


Colorado and the Upper Midwest remain relatively unlikely to experience an induced seismic event in 2017. According to USGS, the Bakken does not have any recorded incidents of induced seismicity, and some of Colorado’s induced seismic events are likely unrelated to oil and natural gas development activities. Aside from a small area in south-central Colorado, USGS projects that the region has a less than 1% chance of experiencing an induced seismic event in 2017.

Oklahoma:

Despite the overall decrease in induced seismic events, parts of Oklahoma continue to have a greater than 10% chance of experiencing an induced seismic event. USGS notes in its press release that despite the decrease in overall seismic events in 2016, Oklahoma experienced the largest seismic event ever recorded in the state as well as the greatest number of large seismic events compared to any prior year.
Thursday, March 02, 2017

Ohio EPA Finalizes New Compressor Station GPs


On March 2, 2017, the Ohio Environmental Protection Agency finalized several general permits relating to natural gas compressor stations and similar facilities. The general permits are designed for facilities typically found near gathering lines leading to interstate transmission networks. In order to qualify for a general permit, the applicant must certify that it meets the corresponding regulatory criteria. The general permits are for minor sources only and may not be used by facilities that trigger the Clean Air Act’s New Source Review requirements.
Thursday, March 02, 2017

Trump Administration Orders Review of Waters of the U.S. Rule



On February 28, 2017, President Donald Trump signed an executive order that requires the U.S. Environmental Protection Agency and the U.S. Army Corps of Engineers to review the final “Waters of the U.S.” rulemaking published on June 29, 2015. The “Waters of the U.S.” rulemaking defines the scope of waters protected under the Clean Water Act. Several states and industry associations challenged the final rulemaking upon publication, alleging that the definition exceeds the scope permitted by the Clean Water Act. The U.S. Court of Appeals for the Sixth Circuit is currently reviewing challenges to the merits of the final rule. Additionally, a challenge to the Sixth Circuit’s jurisdiction to review the final rule is currently pending before the Supreme Court of the United States.

The executive order requires that EPA and ACOE consider whether the final rulemaking ensures “that the Nation’s navigable waters are kept free from pollution, while at the same time promoting economic growth, minimizing regulatory uncertainty, and showing due regard for the roles of the Congress and the States under the Constitution.” The executive order also requires that EPA and ACOE consider interpreting “Waters of the U.S.” in a manner consistent with Justice Antonin Scalia’s opinion in Rapanos v. U.S., 547 U.S. 715 (2006).

In Rapanos, Justice Scalia authored a plurality opinion that concluded that “Waters of the U.S.” – and therefore the jurisdiction of federal agencies under the Clean Water Act – includes only those relatively permanent, standing, or continuously flowing bodies of water. Conversely, Justice Scalia’s plurality opinion stated that water bodies that flow intermittently or ephemerally are not “Waters of the U.S.” Moreover, Justice Scalia’s opinion stated that wetlands are not jurisdictional based on a mere hydrologic connection to “Waters of the U.S.” Instead, for a wetland to be considered jurisdictional, there must be an inherent ambiguity concerning where the jurisdictional water ends and the wetland begins.  

Wednesday, March 01, 2017

PADEP Assesses Operator $1.2 Million Penalty

By:  Michael K. Reer 

On February 27, 2017, the Pennsylvania Department of Environmental Protection announced that it agreed to a $1.2 million civil penalty with an operator to settle violations related to a 2012 impoundment leak. According to the PADEP news release, in September 2012, testing of five private water supplies indicated that local groundwater was affected by a leak from an on-site oil and natural gas development impoundment. The impoundment was located in Donegal Township, Westmoreland County and was drained within one week of PADEP’s discovery of the leak. 

After notification, the operator provided effected households with bottled water and has since installed treatment systems. The operator has also agreed to remediate the site in accordance with the Pennsylvania Land Recycling and Environmental Remediation Standards Act, which will require remediation of the soil, groundwater, and surface waters impacted by the leak.

PADEP stated that the penalty amount will be paid to the Commonwealth’s Well Plugging Fund.

Monday, February 27, 2017

USGS to Release Updated Hazard Maps


On February 23, 2017, the U.S. Geological Survey announced

that it will release updated maps detailing the potential of natural and induced seismic events on March 1, 2017. The 2017 maps mark the second year that USGS has projected both natural and induced seismic risks. USGS previously stated that the best indicator of future induced seismic events in a given region is the number of induced seismic events that the region experienced in the previous 12 months. Therefore, the 2017 induced hazard map is likely to reflect recent seismic activities that USGS believes were induced by human activities such as wastewater injection, coal mining, and reservoir drawdowns.

Friday, February 24, 2017

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