Environmental Protection And Unconventional Well Development in ...

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September 12,
2012


Environmental Protection

And Unconventional

Well
Development

in
Pennsylvania

Overview of Well Development

3

Black Shale Formations


Marcellus


Utica


Rhinestreet


Huron


Upper Devonian


Dunkirk


Pipe Creek


Middlesex


Geneseo


Burket

Generalized Stratigraphic

Section for Oil and Gas Region

G

E

N

E

R

A

L

I

Z

E

D


Marcellus Shale Production Data (Base Map Depicts Thickness
of Organic Rich Material in Target Formation)

Marcellus Shale Advisory Commission

Marcellus Shale Advisory Commission


Executive Order 2011
-
01 Created the Marcellus Shale
Advisory Commission



March 8


July 22, 2011



Goal: outline a comprehensive plan with recommendations
on the safe and responsible development of unconventional
natural gas resources within Pennsylvania



8

A Comprehensive, Strategic Plan


96 Recommendations
outlining a comprehensive,
strategic plan for the responsible development of
natural gas drilling in the Commonwealth.


Every environmental protection recommendation
that needed to be accomplished through legislation
was included in the Act.


Unanimously approved
by the commission on
Friday, July 15, 2011.


Outlined the
first major update of Oil and Gas Act
in
nearly three decades.


9

Statutory and Regulatory Changes

Laws and Regulations



2012 Oil and Gas Act (Act 13)


25 Pa. Code Chapter 78 (Oil and Gas Wells)



Oil and Gas Conservation Law


Coal and Gas Resource Coordination Act


Clean Streams Law


25 Pa. Code Chapter 91 (General Provisions)


25 Pa. Code Chapter 93 (Water Quality Standards)


25 Pa. Code Chapter 95 (Wastewater Treatment
Requirements)


25 Pa. Code Chapter 102 (Erosion and Sediment Control)



11

Recent Regulatory Changes



Well Permit Fee Increase


Act 15 of 2010


Chapter 78 Well Construction Standards


Chapter 95 Regulation Revisions


Act 13 of 2012


Act 9 of 2012




12

Marcellus Well Permit Fees



Increased from
a $100 fixed
amount to
an average of
$3,220


The length of the well increases the fee


Allowed DEP to increase O & G staff


From
90

people in 2008


T
o
202

people in
2012

13

Act 15 of 2010



Repealed:


The
5 year
production
report confidentiality


Requires:



Marcellus operators
to report
production

every 6 months (instead of annually)


DEP to post all production reports
online

14

25 Pa Code, Chapter 78
regs


Took effect
February 5,
2011


prevent
methane
gas migration
,


require
drillers to
detail the
chemicals found in
flowback water,


Flowback water is the
~
10

30%
of frack water
that
returns to the surface within 30 days of
fracking.


require drillers to electronically
report production
and waste
volume data

15

Chapter 78 Well Construction Standards



Goal


further prevent gas migration and protect
water supplies



Comprehensive update to well construction, casing
and cementing standards



Expanded well completion reporting requirements,
including disclosure of hydraulic fracturing chemicals

15

Act 13/2012 Oil and Gas Act

ACT 13 of 2012


Consolidated the Oil and Gas Acts into 58 Pa.C.S. (Act 13)


Created six chapters


Ch. 23



Unconventional Gas Well Fee


Ch. 25



Oil and Gas Lease Fund


Ch. 27



Natural Gas Energy Development Program


Ch. 32


Development


Permitting & Notifications


Environmental
Protections & Enhancements


Inspections
& Enforcement


Ch. 33


Local Ordinances Relating to Oil and Gas Operation


Ch. 35



Responsibility for Fee


18

Permitting & Notifications

Drilling Permit


What’s New

Notice requirements


Host/adjacent
municipalities,


surface
landowner,


water
purveyors
with water
supplies
within
3,000 ft.



Storage
operators within 3,000 ft.


Compliance requirements


Permit
denials for continual
violations


Parent
and subsidiary compliance considered


Permit
denial for failure to pay Impact
Fee

20

Drilling Permit


What’s New


Water
Management Plan
Approval


Required
for water used in drilling and stimulation


No
adverse impacts to water quality/quantity


Maintain
designated and existing uses of water sources


Available
to third parties in the Ohio basin


Compliance
with WMP a condition of well
permit


Water
withdrawals in accordance with
:


Susquehanna
River Basin Commission


Delaware
River Basin Commission


Great
Lakes Commission

21

Drilling Permit


What’s New



Comments
on the Permit by


Municipality where proposed
well will be
located


Storage Operators within 3,000 ft. of well bore



Transparency



Well permit must be posted at well site prior to

o
earth disturbance
activities and

o
well
construction.

22

Drilling Permit


What’s New

N
otification of surface
land owners at the well
site


All drinking water supply owners within 1,000 feet


Setback Distances
-

Gas
wells must be at least


200
feet from
any drinking
water supplies.


100
feet from any stream
, spring
, or body of water.


100
-
feet from
any wetland greater than one
acre

23

Bonding Requirements

Old: $2,500/well or $25,000 blanket bond


New: two bond schedules:

o

< 6,000 feet

o
> 6,000 feet





Based on number of operating wells


Maximum blanket bond increased to $850,000






24

Chapter 95 Regulation Revisions



Limits the discharge of TDS from new or expanded
facilities that take oil and gas wastewater to drinking
water standards



Does not allow for new discharges that exceed 250
mg/l for chlorides and also removes radium



Increases the use of recycled water, promotes the
development of alternative forms of disposal

16

Notifications to DEP


Spud date (commencement of drilling)


Resumption of drilling

o
30
-
day (or longer) break in drilling


Cementing of all casing strings


Conducting pressure tests of the production
casing


Stimulation of a well


Abandoning or plugging of a well





25

Environmental Enhancements &
Protections

DEP District Oil & Gas Operations

45

Well Location Restrictions


Setbacks Increased for Unconventional Wells




Buildings & water
wells
-

from
200 ft. to

500
ft.



A water supply




-

1,000 ft.


Any water body
(stream
, spring,
or wetland > 1
acre





-
from
100 ft. to
300 ft.



Well pads
-

100
ft.



Any water body (stream, spring, or wetland > 1 acre



Variance/waiver possible


27

Well Location Restrictions

A well
site or well bore
is prohibited in a
Floodplain

if
site
will
have

a
pit or impoundment
for:


drill
cuttings,


flowback
water,


produced
water or


hazardous
materials,


chemicals
or
wastes

A well site or well bore is prohibited in a
Floodway

if site
will have a
tank
for containing:


hazardous materials,


chemicals,


condensate,


wastes,


flowback or produced
water

28

Protection of Water Supplies

Operators are required to:


Protect
drinking
water supplies
near gas wells
,


Restore
or
replace any
water supply determined by DEP
to be
polluted by nearby
gas well drilling.

Operators presumed
to be responsible
within
1,000
feet
if

it occurs within
six months
after


completion
of
drilling


alteration of the
gas well
.

31

Protection of Water Supplies

Rebuttable
Presumption Increase



From 1,000 ft. to
2,500 ft.

of the water supply


From
6 months to
12 months

after
well
completion,
drilling, stimulation or
alteration, whichever is later.


Operator must notify landowner or water purveyor that
rebuttable presumption may be void if the landowner
or water purveyor refuses to allow operator to conduct
pre
-
drilling or pre
-
alteration survey (3218(e.1))


30

Oil
& Gas
Pre
-
Drill Testing

Analyte (Inorganic)

Analyte (Trace Metal)

Analyte (Organic)

Alkalinity

Barium

Ethane*

Chloride

Calcium

Methane*

Conductivity

Iron*



Hardness

Magnesium

Analyte (Microbiology)

Oil and Grease

Manganese*

Total Coliform/E. Coli

pH*

Potassium



Sulfate

Sodium*



Total Dissolved Solids*

Strontium



Residue
-

Filterable



Total Suspended Solids



Residue


Non Filterable



33

Protection of Water Supplies

Restoration/Replacement of Water Supplies


Temporary Water


Permanent Water

Replacement Water
Quality


Must meet Safe Drinking Water Standards or pre
-
drilling conditions

Transparency


Any confirmed case
of subterranean water supply
contamination will be reported on DEP’s website.

32

Who does the Testing?

The gas
well company is required to hire
an
independent
state
-
certified water testing
laboratory to
conduct the
pre
-
drill testing.

35

Well Control Emergency Response

DEP may:


Enter into contracts with well control specialists to
provide response services in the event of an
emergency


The Well Control Specialist:


Shall be immune from civil liability for good faith
actions (except for breach of contract, intentional
tort or gross negligence)

34

Chemical Disclosure

Within 60 days of finishing hydraulic fracturing:


Operator must complete the chemical disclosure registry
form and


P
ost it using
the chemical disclosure registry at
www.FracFocus.org


37

Air Contaminant Emissions


Operators must submit a source report identifying and
quantifying actual air contaminant emissions to DEP


Annually by March 1 for the preceding calendar year


DEP submits the total air pollution emissions every three
years
to
EPA

39

Disposal of Drilling
Fluids

2010
-

new regs limit TDS discharges.


2,000 mg/L TDS
for new
& expanding treatment
facilities
.


Tighter
standards apply to wastewater

from
the
natural
gas industry


500 mg/L TDS
,


250
mg/L
chlorides
, and


10 mg/L barium &strontium


These are
based on
monthly averages
.

39

Act 9 0f 2012


Amended Title
35 (Health and Safety)
to require


Emergency regulations for well sites


A
a unique GPS coordinate address for


the
access road entrance and


The well site
.


Development an
emergency response plan


Posting of
a reflective sign at the
entrance

40

Inspections & Enforcement

Types of Inspections

Well Pad Inspections (Surface)



Water Quality Specialists



Erosion and Sedimentation Controls



Inspect waste containment

Well Drilling Inspections (Sub
-
surface)



Oil and Gas Inspectors



Perform inspections when well drilling commences and ongoing drilling activities



(setting casings, cementing jobs, etc.)



Inspect well fracturing operations


Other DEP Inspections



Air Quality



Waste Management



Water Management (Water Quality)

46

(New) Inspection Requirements

Inspections of E&S Controls


An operator may not commence drilling activities until
after

DEP has
conducted an inspection of the unconventional well site
after

the
installation of erosion and sedimentation (E&S) control measures.


Site Access


The person in charge of a well site property, facility, operation or
activity subject to Chapter 32 of Act 13 must provide to DEP and its
agents access to the site and facilities for inspection purposes or to
remediate or respond to a well control emergency.



47

(New) Inspection Requirements

Availability of Inspection Reports


Inspection Reports are available for public review at each DEP District
office (ongoing practice)



DEP will post inspection reports on its website. The reports will
include:


Nature and description of violations


Operator’s written response to violation, if available


Status of violation


Remedial steps taken by operator or DEP to address a violation


48

Enforcement

Permit Denial (New)



DEP may deny a permit if:



Applicant,
or any parent or subsidiary corporation
, is in continuing violation
of:


Act 13


Any other statute administered by the Department


Any Plan Approval, permit or order of the Department



(3211(e.1)(5))







45

Enforcement

Permit Revocation (New)


DEP may suspend or revoke
a
well permit or registration for
any well in
continuing violation of
:
(3251(b)(1))


Act 13


Clean
Streams Law


Solid Waste Management Act


Any other statute administered by DEP


OR if the likely result of a violation is an unsafe operation or environmental
damage


Prior to suspension or revocation of the permit


DEP shall provide written notice to the operator or its agent


(32519(c))







46

South Newark Basin Field

47

Comments & Questions