Oil and Gas

Governor Tomblin calls special session of the West Virginia Legislature regarding legislation on development of shale gas.

Governor Tomblin called a Special Session of the West Virginia Legislature beginning on December 11, 2011, to consider legislation regarding development of shale gas formations using horizontal wells and hydraulic fracturing techniques.  

EPA Contemplating Discharge Limits for Wastewater Treatment Plants That Accept Hydraulic Fracturing Flowback

On November 16, 2011, the House Transportation and Infrastructure Subcommittee held a hearing to discuss potential regulations for the hydraulic fracturing of shale beds.  Among those testifying was James Hanlon, Director of EPA’s Office of Wastewater Management. Mr. Hanlon’s full testimony can be found at http://transportation.house.gov/hearings/Testimony.aspx?TID=6899.   Mr. Hanlon made clear that EPA is considering establishing new discharge standards for wastewater treatment plants that accept fracturing flowback water due to concerns of the potentially high concentrations of salts, radionuclides, heavy metals, and other materials that are potentially harmful to human health and the environment.  These regulations would be in addition to the pre-treatment standards EPA is currently developing for fracturing flowback water before it can be sent to wastewater treatment plants.

Aware of the growth potential of the shale gas extraction in many parts of the country, Mr. Hanlon stated that “EPA believes the initiation of a rulemaking, including the data collection necessary to better understand environmental impacts and available treatment options in support of such a rule, is an appropriate step.”  Hanlon went on to state that EPA’s wastewater treatment rules can be expected by 2014.

Many states have already begun to regulate, or in some cases ban, the disposal of fracturing flowback through sewage treatment plants.  Already there have been responses that this is a matter that should be left to the individual states to regulate.

Oil and Gas Source Determination & Calculations Workshop

The West Virginia Chapter of the Air & Waste Management Association (AWMA) will deliver a workshop entitled, Oil and Gas Source Determination & Calculations – Air Emissions Aggregation Analysis, on Wednesday, November 30, 2011 from 10:30 a.m. – Noon (followed by lunch).  Speakers for the event include Jerry Williams from the WVDEP, Division of Air Quality and Shyla Blackketter-Dwyer from Chesapeake Energy.  Cost of the workshop (which will be in Conference Room L-1 of the Chase Bank Building on Virginia Street in Charleston, West Virginia) is $15.

If you are interested in attending, RSVP by sending an email to billob@citynet.netby 5:00 p.m. EST on Monday, November 28, 2011.  Kathy Beckett, AWMA board member and Jackson Kelly PLLC member, coordinated this event between the West Virginia Division of Air Quality and the industry attorney, Shyla Dwyer of Chesapeake Energy.

U.S. EPA Announces 35-Day Extension for Final Oil & Natural Gas Air Standards

U.S. EPA has announced a new date of April 3, 2012, for promulgation of the final new source performance and air toxics standards for the oil and natural gas industry.  According to U.S. EPA’s Oil and Natural Gas Air Pollution Standards website, the plaintiff environmental groups in a citizen suit concerning EPA’s oil and natural gas air standards have agreed to a 35-day extension of the date for the final rule.  The agreement would extend the deadline for the final rule from February 28, 2012, to April 3, 2012.  U.S. EPA states it will post the final agreement on its website once the district court has approved the final agreement amending the consent decree.  The citizen suit is WildEarth Guardians v. Jackson, No. 1:09-CV-00089-CKK (D.D.C.). The proposed rule was published in the Federal Register on August 23, 2011 (76 Fed. Reg. 52,738).  For more information on the proposed rule, see article titled “EPA Proposes New Air Regulations Affecting Fracked Wells,” posted on the Jackson Kelly PLLC Oil and Gas Update on August 1, 2011.

This e-alert was authored by Gale Lea Rubrecht in the Firm’s Charleston, WV office.  For more information on the author, click here.

Women's Energy Network Appalachian Chapter

The Women's Energy Network (WEN) has launched its newest chapter: "Women's Energy Network Appalachian Chapter."  WEN is an association for women professionals that provides networking opportunities in the energy industry and fosters career and leadership development.  The Appalachian Chapter will facilitate social and professional networking opportunities in the region, cross-industry knowledge-sharing and educational opportunities among members from diverse professional backgrounds in all areas related to furthering women in the energy industry. The chapter's board of directors includes representatives from Alpha Natural Resources, Chesapeake Energy, CONSOL Energy, EQT, Jackson Kelly PLLC and Stone Energy Corporation.  WEN also has chapters in Texas and Louisiana.  Houston's president, Jeannie Gardner welcomed the new chapter stating, "The Board of Directors of WEN Houston are excited to welcome the Appalachian Chapter.  This region is rich with energy resources, and I believe it is a perfect choice for the location of a new WEN chapter to support the major economic development."

EPA Proposes to Extend 2012 GHG Reporting Deadline for Oil & Natural Gas Systems

EPA recently published a proposed rule proposing a one-time extension of the 2012 reporting deadline for Petroleum and Natural Gas Systems (subpart W) and other facilities and suppliers subject to source categories for which data collection began January 1, 2011 (76 Fed. Reg. 47,392; August 4, 2011).   Specifically, EPA is proposing a 6-month extension from March 31, 2012 to September 28, 2012.  The proposed rule would also amend specific provisions in the Mandatory Greenhouse Gas Reporting Rule to correct certain technical and editorial errors that have been identified since promulgation and to clarify or propose amendments to certain provisions that have been the subject of questions from reporting entities.  Comments are due September 19, 2011.  For more information about the technical clarifications and amendments that EPA is proposing for subpart W, continue reading.

EPA Proposes to Extend 2012 GHG Reporting Deadline for Oil & Natural Gas Systems

EPA recently published a proposed rule proposing a one-time extension of the 2012 reporting deadline for Petroleum and Natural Gas Systems (subpart W) and other facilities and suppliers subject to source categories for which data collection began January 1, 2011 (76 Fed. Reg. 47,392; August 4, 2011).   Specifically, EPA is proposing a 6-month extension from March 31, 2012 to September 28, 2012.  The proposed rule would also amend specific provisions in the Mandatory Greenhouse Gas Reporting Rule to correct certain technical and editorial errors that have been identified since promulgation and to clarify or propose amendments to certain provisions that have been the subject of questions from reporting entities.  Comments are due September 19, 2011.  For more information about the technical clarifications and amendments that EPA is proposing for subpart W, continue reading.

• Definition of “Gas Well”:  EPA is proposing to amend the definition for “gas well” in 40 CFR 98.238. The definition of gas well that was finalized in the rule left open the question of whether or not gas wells that included any hydrocarbon condensate are also considered gas wells. The proposed amendment would clarify the definition for “gas well” by stating that it includes gas wells that also produce natural gas including condensate.
• Threshold Clarifications: EPA is proposing to clarify that throughput thresholds for the onshore natural gas processing industry segment, glycol dehydrators, and onshore production storage tanks be based on an annual average throughput. 
• Greenhouse Gases to Report: EPA is proposing to clarify that the greenhouse gases to be reported under the “natural gas processing industry segment” include nitrous oxide (N2O) emissions, and not just carbon dioxide (CO2) and (CH4) emissions. In addition, EPA is proposing to clarify that CO2 and CH4 emissions are to be reported from the natural gas distribution industry segment.
• Calculating Greenhouse Gas Emissions: EPA is proposing several clarifications, corrections, and amendments to the equations, methodological options, and calculation methods throughout 40 CFR 98.233.    While EPA verbally describes these changes in the proposed rule, these and other technical corrections can best be viewed and understood on EPA’s redline of the proposed 2011 Technical Corrections, Clarifying and Other Amendments to the Mandatory Reporting of Greenhouse Gases Rule.
• Emission Factor Tables: EPA is proposing to revise the emission factors for high bleed, low bleed, and intermittent bleed pneumatic devices, which were on a CH4 basis, to account for the total hydrocarbon basis. These proposed revisions would apply to Table W-3 and Table W-4.   
• Other Technical Corrections: EPA is proposing to clarify that only the number of work-overs with hydraulic fracturing that vent gas to the atmosphere or flare gas needs to be reported. EPA is also proposing to correct the density parameter in Equation W-36.

For additional information, see EPA’s Fact Sheet, Information Sheet, and Frequently Asked Questions. 

This e-alert was authored by Gale Lea Rubrecht, Jackson Kelly PLLC. For more information on the author, see here.

WV DEP Issues Emergency Regulations Regarding Horizontal Wells

The West Virginia Department of Environmental Protection, Office of Oil and Gas, filed its emergency oil and gas rules relating to drilling horizontal wells as directed by Governor Tomblin in July. The rules will become effective after approval by the Secretary of State and can remain in effect for as long as fifteen months without legislative approval.

U.S. Secretary of Energy Advisory Board Issues Recommendations

On August 11, 2011 the Shale Gas Subcommittee of the Secretary of Energy Advisory Board issued its report that identifies measures that can be taken to reduce environmental impact and improve safety of shale gas production.   The full report can be found at http://www.shalegas.energy.gov/index.html. 

EPA Proposes to Extend BAMM for Reporting Greenhouse Gases

On June 27, 2011, the U.S. Environmental Protection Agency (EPA) published a proposed rule proposing to amend provisions related to best available monitoring methods in its regulations for Petroleum and Natural Gas Systems of the Greenhouse Gas Reporting Rule (76 Fed. Reg. 37,300).  In the final Subpart W: Petroleum and Natural Gas Systems of the Greenhouse Gas Reporting Rule that was published November 30, 2010 (75 Fed. Reg. 74,458), EPA requires specified data input requirements for determining greenhouse gas emissions but allows best available monitoring methods, also called BAMM, in lieu of the specified data input requirements in certain circumstances for specified emissions sources. BAMM includes supplier data, monitoring methods currently used by the facility that do not meet the specifications of a relevant subpart of the rule, engineering calculations, and/or other company records.  Originally, EPA had allowed the use of BAMM only through June 30, 2011, and had required that a request for an extension to use BAMM during calendar year 2011 beyond June 30, 2011, be submitted by April 30, 2011, and that a request for an extension beyond 2011 be submitted by September 30, 2011.  Earlier this year, EPA extended the April 30, 2011 deadline to July 31, 2011, and the June 30, 2011 deadline to September 30, 2011 (76 Fed. Reg. 22,825, April 25, 2011).  The proposed rule would extend the BAMM deadlines again.