The West Virginia Department of Environmental Protection Division of Air Quality recently issued the draft Class II General Permit G70-A for the Prevention and Control of Air Pollution in regard to the Construction, Modification, Relocation, Administrative Update and Operation of Natural Gas Production Facilities Located at the Well Site. The Notice of Intent to approve the permit indicates that the public may provide written comments regarding the permit to the Division of Air Quality, and that all such comments and requests for a public meeting regarding the permit must be received before 5:00 p.m. on Monday, April 29, 2013. The Draft Engineering Evaluation/Fact Sheet regarding Class II General Permit G70-A can be found here.
Typically, midstream or infrastructure investments by oil and gas companies follow drilling. But in Ohio billions of dollars are currently being poured into pipelines and facilities, including those currenlty under construction in Kensington and Scio, in anticipation of production of the Utica Shale formation. Given the estimated ultimate recovery projected for wells drilled in the Utica, and the recent surge in natural gas and oil production around the United States, experts predict that such investments will occur for the next twenty years. The midstream projects include laying more than a thousand miles of pipeline and the construction of processing facilities and compressor stations. In each kind of midstream project there are dozens of business opportunities that are providing jobs to local companies, ranging from biologists, arborists and chemists to construction specialists, mechanics, manufacturers and laborers.
As reported in Wheeling News-Register, several proposals related to oil & gas development introduced by members of the West Virginia Legislature did not receive enough support to make it to a vote before the Legislature adjourned its 2013 Regular Legislative Session on April 13th. One bill proposed the creation of a “West Virginia Future Fund,” funded with severance tax revenues, which would be used to finance future infrastructure, education and other investments. Other failed legislative proposals include a bill to monitor seismic activity near production and injection wells, a bill that would require landmen that are not members of the American Association of Professional Landmen to, among other things, take an ethics class, and a bill to integrate co-tenant lessors of oil and gas interests into a proposed drilling unit under very specific circumstances.
Magnum Hunter, working through its subsidiary Triad Hunter, spudded its first horizontal well in Ohio’s Utica Shale formation. The well is located in Washington County, just north of Noble County. It is just the second well permitted in Washington County.
Magnum Hunter has approximately 79,000 acres in the Utica play with about half being in the “wet gas” window located in southeast Ohio. The Washington County well will be fractured and tested this summer.
Updating a previous post, this week Sally Jewell was reportedly approved by the Senate in a 87 to 11 vote to serve as the next Secretary of the U.S. Department of the Interior. Jewell will oversee over 500 million acres of national parks and public land, and over 1 billion acres offshore.
On April 10, 2013, the Oneida County Board of Legislature reportedly approved a resolution that prohibits the extraction of shale gas on property owned by the county. Oneida County is located in central New York to the east of Syracuse. The resolution provides that the ban on shale gas extraction will remain in place until further study of the potential environmental and public health impacts of hydrofracking is completed.
The U.S. Environmental Protection Agency’s proposed revisions (described in an earlier post) to certain new source performance standards affecting the oil and natural gas sector were published today in the Federal Register, marking the beginning of the public comment period. Comments are due on May 13, 2013.
The U.S. Department of Transportation’s Pipeline and Hazardous Materials Safety Administration (PHMSA) recently released updated enforcement guidance for complying with its operator qualification (OQ) and hazardous liquid integrity management program (IMP) requirements. PHMSA’s OQ requirements establish minimum federal safety standards for the qualification of individuals who perform covered tasks. A covered task is an activity identified by the operator that is performed on a pipeline facility, is an operations and maintenance task, is performed as a requirement of the pipeline safety regulations, and which affects the operation or integrity of the pipeline. PHMSA’s IMP requirements apply to hazardous liquid and carbon dioxide pipelines that could affect a high consequence area (HCA) in the event of a leak or failure. HCAs include commercially navigable waterways, certain populated areas, and other areas that are unusually sensitive to environmental damage. PHMSA’s enforcement guidance provides information on each of the regulatory provisions, including a recitation of the applicable text, summaries of the relevant interpretations, advisory bulletins, and other reference materials, and examples of situations that might result in probable violations.
Akron city council has approved plans for the first natural gas filling station and truck terminal in the city, operated by J Rayl Transport. The company plans to convert their entire truck fleet from diesel to natural gas, or a combination of the two. The company cites the cheaper cost of natural gas, its ready availability and the fact that it is a cleaner burning fuel source as its reasons for the changeover.
Updating a previous post, The Intelligencer reports that the West Virginia Senate declined to consider legislation that would have allowed un-leased land to be included in drilling units. Senator Brooks McCabe (D-Kanawha), who introduced Senate Bill No. 616, stated that “I don’t want to speculate whether it was for a lack of support, or if it was just introduced too late in the session. It just never got any traction.”
According to The Republic, Federal District Court Judge Irene Keeley has temporarily deferred ruling and is seeking guidance from the West Virginia Supreme Court of Appeals on a vital oil and gas drilling issue. Judge Keeley seeks to have the State’s highest court weigh in on whether West Virginia law permits a natural gas drilling company to use one owner’s land to drill horizontal wells designed to capture gas from neighboring tracts. The outcome will have far reaching implications, both legal and economic, on the State’s economy, and will affect the individual drilling companies operating in the State of West Virginia. The parties to the case are currently scheduled to submit appropriate filings to the Federal Court by April 29th.
On April 1, 2013, Dominion announced that it was submitting an application to the Federal Energy Regulatory Commission (FERC) for a $3.4 billion to $3.8 billion natural gas liquefaction project at its existing Dominion Cove Point LNG Terminal located on the Chesapeake Bay in Lusby, Maryland, the Pittsburgh Post-Gazette reports. Cove Point will serve both the Marcellus and Utica shale plays. Subject to receipt of regulatory approvals, Dominion plans to start construction on the 5.25-MTPA (million tons per annum) facility in 2014 and put the liquefaction facilities in service in 2017.
On April 3, 2013, the PADEP issued a press release informing the public that it had released additional information and details regarding its ongoing comprehensive radiation study of oil and gas development in Pennsylvania, which was originally announced by PADEP on January 24, 2013. The additional information includes PADEP’s:
According to the press release, PADEP “will sample and analyze radioactivity levels of flowback waters, treatment solids, drill cuttings and drilling equipment, along with the transportation, storage and disposal of drilling wastes.” PADEP noted that it plans to begin sampling this month.
The Independent Oil & Gas Association of New York reportedly filed a formal complaint with New York’s Joint Commission on Public Ethics on March 26, 2013, requesting an investigation into whether the group known as “Artists Against Fracking” is violating state lobbying laws. Artists Against Fracking consists of several high-profile celebrities, including Yoko Ono and her son Sean Lennon, who are outspoken opponents of hydraulic fracturing. The complaint asserts that neither Artists Against Fracking nor the individual members are registered as lobbyists in New York, and that the group has failed to disclose its spending in opposition to hydraulic fracturing. Reported statements offered by a former New York lobbying regulator, David Grandeau, suggest that advocates who spend more than $5,000 are required to register. A spokesman for Artists Against Fracking, David Fenton, said the group and its members do not have to register as lobbyists “when they use their own money to express an opinion.”
On April 2, 2013, the U.S. Environmental Protection Agency (EPA) withdrew a direct final rule it issued in February 2013 that required oil and natural gas companies to submit by June 30th of each year a request to use alternative calculation methods for reporting greenhouse gas emissions. EPA received adverse comments on the direct final rule, and will instead address this issue through the proposed rulemaking process.