Oil and Gas

Unanimously Passed Drilling Emergency Response Bill to be Signed by PA Governor

Although a comprehensive Pennsylvania Marcellus Shale bill is still heavily under negotiations, Governor Tom Corbitt is set to sign legislation that was unanimously passed by the Senate this week.  The legislation is designed to provide an emergency response plan and accurate GPS coordinates for each Marcellus Shale well site in Pennsylvania.  The measure introduced by Sen. Lisa Baker, a Luzerne County Republican, requires drillers to inform state and local officials of well pad locations and access roads.  They also must submit an emergency response plan to those officials, and post a reflective sign at the entrance to each well site with the address, GPS coordinates, the operator's emergency contact number and anything else state regulators decide to require.  The provisions of this law are to become effective immediately upon the Governor’s signature.  To view a full copy of the bill, click here.

http://www.legis.state.pa.us/CFDOCS/Legis/PN/Public/btCheck.cfm?txtType=HTM&sessYr=2011&sessInd=0&billBody=S&billTyp=B&billNbr=0995&pn=1844

Presentation On West Virginia Natural Gas Horizontal Well Control Act

On Tuesday, December 20, 2011, members of the Jackson Kelly PLLC Oil and Gas Industry Group conducted a briefing conference call to provide a substantive overview of the 105-page H.B. 401 that was passed by the WV Legislature to govern horizontal well operations. The new law became effective on December 14, 2011. If you missed it, we have attached a copy of the slides used during the presentation. Or, you may click here for a link to the PowerPoint presentation or click here to view it as a PDF file. You may save, print and use the slide presentation in either format.  The presentation contains information you and others at your company can use to learn about the content of this important legislation. 

Marcellus Legislation Approved

The West Virginia Legislature passed legislation regulating Marcellus shale in West Virginia.  As reported on Monday, the bill proposed by Governor Earl Ray Tomblin during the special session this week, referred to as the Natural Gas Horizontal Well Control Act, requires higher permit fees, adds buffer zone provisions and more regulatory oversight of horizontal gas drilling and production activities in West Virginia.  The House of Delegates made several amendments to the bill Tuesday prior to its passage.  The bill will now be sent to Governor Tomblin for his signature.  The amendments to the Governor’s bill include the following:

• Requiring the West Virginia DEP to submit a report to the Legislature on the number of waivers granted regarding casing and cement standards and programs; 
   
• Requiring the West Virginia DEP to propose emergency and legislative rules pertaining to drilling in karst formations; 
   
• Requiring newspaper publication of a notice of permit applications and providing an opportunity for the public to submit written comments; 
   
• Requiring DEP to prepare a report to the Legislature on noise, light, dust and volatile organic compounds and their relationship to well location restrictions for occupied dwellings; 
   
• Allowing DEP to propose guidelines and procedures for controlling and mitigating levels of noise, light, dust and volatile organic compounds in relation to horizontal drilling activities; 
   
• Exempting certain wells from the Natural Gas Horizontal Well Control Act; and 
   
• Establishing criminal penalties and offenses for certain activities. 

Click below to read the entire bill as amended.
http://www.legis.state.wv.us/Bill_Status/bills_text.cfm?billdoc=hb401%20eng.htm&yr=2011&sesstype=4X&i=401

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.  

Special Session for West Virginia Legislature

Governor Earl Ray Tomblin reportedly will call the legislature into special session beginning Sunday evening at 5 p.m. to deal with policies on the development of Marcellus shale in West Virginia.  A special legislative committee has been working on and approved a bill last month addressing Marcellus shale development. The bill includes increases in permit drilling fees, requirements for casing for the drilling area, and rules regarding proximity of drilling sites to residences.  Reportedly, representatives of the Tomblin administration met with stakeholders this week in an effort to reach a compromise on the legislation.  It is anticipated that Governor Tomblin's bill will include several proposed changes to the committee's bill.  Governor Tomblin announced yesterday that he would probably call the legislature into special session next week to deal with Marcellus shale policy during the 25^th Annual Project BEST breakfast at Oglebay Park’s Wilson Lodge.  We will update with details of the Governor’s bill as soon as it is made available.

West Virginia Legislature Joint Select Committee on Marcellus Shale Adds Final Amendments and Approves Bill, Seeks Special Session

The West Virginia Legislature’s Joint Select Committee on Marcellus Shale recently added final amendments and approved a bill regarding regulations to Marcellus drilling activities, and asked Governor Earl Ray Tomblin to call a special session of the Legislature to take up the measure immediately.  Previous attempts to pass legislation regulating Marcellus Shale drilling have been unsuccessful, and advocates from both industry and environmental groups remain concerned over the scope of the bill.

U.S. Senate Committee Holds Field Hearing in Charleston Regarding Marcellus Regulation

On Monday, November 14, 2011, the U.S. Senate Energy and Natural Resources Committee held a field hearing at the Robert C. Byrd U.S. District Courthouse in Charleston, WV regarding Marcellus Shale Gas development and production in West Virginia.  Senator Joe Manchin chaired the hearing, and was joined by all three of West Virginia’s House of Representatives members, Congressman David McKinley, Congresswoman Shelley Moore Capito, and Congressman Nick Rahall.  The focus of the hearing was whether the states or the federal government should have the primary role in regulating the oil and gas industry as activity in the Marcellus and other shale plays continues to grow.  On hand to provide testimony were several industry, environmental, and state officials, including DEP Secretary Randy Huffman, Chesapeake Energy’s Scott Rotruck, EQT’s Kevin West, and EPA Regional Water Protection Director Jon Capacasa.

SEAB Shale Gas Production Subcommittee Reports

Following President Barack Obama’s declaration that “recent innovations have given us the opportunity to tap large reserves – perhaps a century’s worth” of shale gas on March 31, 2011, he instructed Secretary of Energy, Steven Chu, to form a subcommittee of the Secretary of Energy Advisor Board (SEAB) “to make recommendations to address the safety and environmental performance of shale gas production.”  SEAB Shale Gas Production Subcommittee – 90 Day Report (August 18, 2011).  In response to that charge, the SEAB Shale Gas Production Subcommittee has produced two 90 Day Reports, on August 18, 2011 and November 18, 2011.  These reports are available at http://www.shalegas.energy.gov/.

U.S. Forest Service Proposes to Ban Fracking in George Washington National Forest

The U.S. Forest Service is proposing a Revised Land and Resource Management Plan (RLRMP) for the George Washington National Forest (GWNF) in Virginia and West Virginia.   The plan, which is mandated to be periodically updated, generally every 10-15 years, by the National Forest Management Act of 1976 provides the basis for land management decisions, including leasing and permitting of oil and gas exploration and production within the GWNF.   Development of the RLRMP is subject to NEPA, so the draft plan is accompanied by a draft environmental impact statement (DEIS).    The plan proposes to allow oil and gas drilling within the GWNF, but will prohibit horizontal drilling and use of fracking fluids in drilling, at least until the U.S.F.S. is satisfied that there would be no adverse impacts of water quality in the area.   This proposed moratorium has not been adequately supported by scientific data and is at odds with the Reasonably Foreseeable Development Scenario for Oil and Gas for the GWNF which was prepared by the Department of the Interior and the Bureau of Land Management for GWNF in October, 2010.    The proposed plan revisions would have the effect of severely limiting, or restricting entirely, commercial development of the Marcellus Shale formation within the GWNF.   

In addition to the fracking and horizontal drilling issues, the DEIS raises issues regarding potential for unacceptable stream and aquifer depletions attributable to fracking which would have an adverse impact on certain species, wetlands and habitat.   These concerns could be the basis for additional lease terms limiting the amount of water that could be used for oil and gas development. 

The affected counties in West Virginia include Hardy, Hampshire and Pendleton, all of which have lands within the GWNF.  Comments on the proposed RLRMP are due not later than Monday, October 17, 2011.

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.