New rules for water withdrawals from the SRBC

Beginning on Oct. 15, the Susquehanna River Basin Commission will require that every natural gas operator that seeks to draw water from the basin to develop wells in the Marcellus Shale will need to get prior approval from the commission.

In the past, only operators that consumed an average of 20,000 gallons per day or more during any consecutive 30-day period or withdrew 100,000 gallons per day or more during any consecutive 30-day period, were required to get prior approval.

The rule change marks the first time in the commission's history that such prior approval has been imposed on a class of projects, according to commission executive director Paul Swartz. "After careful consultation with the commissioners and my technical and legal staff, I decided it would be prudent to impose the more stringent provision on the natural gas industry to give us the ability to review and regulate the industry's individual and cumulative impacts on water resources," he said in a news release on Aug. 15.

According to Paula Ballaron, the commission's regulatory program director, gas companies were taking up a lot of the commission's time asking questions about how to "just skim under the radar" of the commission's regulations. "A lot of the effort, at least initially, was being spent on avoiding the whole thing," she said. Now, the commissions' exchanges with gas companies can be directed toward ensuring proper compliance with the regulations that apply to everyone.

Because the additional applications will probably strain the commission and slow down the gas companies, the commission is proposing new rules that would provide a "more streamlined administrative procedure for reviewing consumptive water uses by the natural gas industry." Specifically, the proposed rule change calls for expanding the "approval by rule" procedure, so that it is available regardless of the water source a gas company wants to draw from. Approval by rule currently only allows companies to buy water from public water supplies while waiting for approval to draw surface water from the basin's rivers and streams.

The proposed rules will be released for public comment at the commission's quarterly public meeting on Sept. 11 at Bucknell University.

Potential economic impact study

Penn State Professor Timothy Kelsey has written a paper, 'Potential Economic Impacts of Marcellus Shale in Pennsylvania: Reflections on the Perryman Group Analysis from Texas.'

Kelsey's report refers to a study of the Barnett Shale in Texas by Texas-based economic consultants Perryman Group. The Perryman Group completed its study this year.


In his report, Kelsey writes that many sectors in the state's economy will benefit from natural gas exploration and drilling, with opportunities for a number of industries, including construction, retail and trade.

He says the two-fold economic challenge is:
1- Finding ways to help local businesses and workers compete for the new business opportunities arising from natural gas
2- Finding ways to encourage businesses, workers, and royalty owners to spend locally


Kelsey also states that local jurisdictions will face "higher service costs due to natural gas exploration."

He adds, "In other words, local jurisdictions with natural gas wells very likely will face higher demands for services and thus higher costs, and yet receive little new revenues to pay for those services."

Chief Oil and Gas meeting

Chief Oil and Gas LLC has scheduled a 'community meeting' for Tuesday, Aug. 25, at the Harford Fire Hall. The meeting runs from 5 to 9 p.m. According to a Chief spokeswoman, the company is holding the meeting to inform the public about Chief's operations. She noted the company holds community meetings before they begin drilling wells in an area.

The Harford fire hall is located on Fair Hill Road. Any questions, call, 1-866-770-5827


-- Josh Mrozinski

DEP Says Municipalities Have Some Say Over Gas Development

The state Department of Environmental Protection recently weighed in on the role local municipalities can play in regulating oil and gas development.

The issue is at the heart of a Supreme Court case, scheduled to be argued in September, over oil and gas ordinances adopted in Salem Township in Westmoreland County and Oakmont Borough in Allegheny County. Those ordinances were challenged in court by gas companies or industry groups.

The state law that regulates gas drilling, the 1984 Oil and Gas Act, explicitly precludes municipalities from regulating anything already outlined in the act. How wells will be permitted and plugged, what safety features and environmental controls are necessary, and how well sites must be restored are all outside local control.

But DEP filed friend of the court briefs in the cases stating that "the Department does not support a reading of the (Oil and Gas) Act that eliminates any municipal regulation of oil and gas well activities that bear only a tangential relationship to the features" already regulated by act.

DEP also states that municipalities "retain the authority to make land use determinations" as long as they are not redundant or do not conflict with the act.

In the Oakmont case, DEP held that the Commonwealth Court was wrong to say that the Oil and Gas Act preempts a municipality's right to limit gas drilling to certain zoning districts. A municipality must allow for gas drilling to occur somewhere, but the Municipalities Planning Code-- which regulates how towns and cities make zoning laws-- "does not require that mineral development be allowed in each and every zoning district," the Department argued. In essence, DEP said that municipalities can regulate where wells are drilled, as long as they do not try to regulate any aspect of how wells are drilled.

DEP noted that the court also mistakenly conflated setback limitations in the Oil and Gas Act (which determine how far away from structures and water sources a gas well can be drilled) with an understanding that gas operators have "unconditional permission to locate oil and gas operations 'anywhere' in a municipality" outside those minimum setback distances.

This reading, if adopted by the Supreme Court, could have profound implications for municipalities seeking to limit where gas wells can be drilled, particularly since most wells are planned for agricultural or residential zones where industry is not traditionally prevalent.

The DEP was less definitive in the Salem case, which challenged a more wide-ranging ordinance that regulated everything from the placement of access roads and pipelines, to the installation of tire-cleaning surfaces, to water-quality testing associated with oil and gas development.

The court acted properly in that case, the DEP argued, except that it failed to allow for local control over grading and slope standards for wells-- a fact that had been established by a previous precedent.

DEP relied on the court's description of the Salem ordinance for its opinion and was careful to tailor its agreement with the court's decision to that "limited description."

In its decision, the Westmoreland County Court had thrown out the Salem ordinance wholesale, without addressing the particular aspects of the ordinance piece by piece-- much to the dismay of the township's solicitor who had hoped to press the court for a finding on each specific issue.

Wine country visit yeilds gas

I went to the Finger Lakes region to visit wineries, but saw something that reminded me of Northeastern Pennsylvania:
A four-acre drill pad overlooking Keuka Lake.
In the middle of the gravel was a cement platform with some plumbing on top, waiting for a gathering pipe to carry the precious gas away.
The pad was just down the road from the quaint farmhouse bed and breakfast I stayed at. Turns out, the co-owner Keuka Overlook Bed & Breakfast, Bob Barrett, is also on the Barrington Township Zoning Board.
The Finger Lakes region is full of very practical farmers. While some have complained as the well was being drilled and trucks hauled in gravel, Mr. Barrett said since activity there has quieted so has the grumbling.
“The gas company was very straightforward and direct,” he said. “The roads took a beating, but they said the roads will be restored.”
Mr. Barrett tells me I also passed a portion of the 77-mile natural gas pipeline known as the Empire Connector being interred nearby, but I missed that. He said those crews are restoring the land to its prior condition or better. So far, he said the gas and pipeline companies have been responsible.
“There are lots of things that will be necessary in the future that we ought to accept and sacrifice for now,” he said.
-- David Falchek