Oil and Gas Update Citizens Advisory Council April 21, 2015 - - PowerPoint PPT Presentation

Oil and Gas Update

Citizens Advisory Council April 21, 2015

Roadmap

• Overview
• Enforcement
• Integrity and Transparency
• Surface Activities Rulemaking
• Vision for the Future
• Question and Answer Session

6,251 7,429 7,599 8,557 5,904 7,084 5,976 3,991 4,780 4,278 491 500 1,000 1,500 2,000 2,500 3,000 3,500 4,000 4,500 5,000 5,500 6,000 6,500 7,000 7,500 8,000 8,500 9,000 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Year

Total Well Applications Received

03/12/2015

19 58 185 576 2,044 3,364 3,560 2,649 2,965 3,182 369

500 1,000 1,500 2,000 2,500 3,000 3,500 4,000 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

# of Permits Year

Unconventional Shale Well Permits Issued 03/12/2015

6,053 7,494 7,102 7,368 4,197 3,232 2,185 1,564 1,645 1,268 112

1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

# of Permits Year

Conventional Well Permits Issued 03/12/2015

8 37 116 332 818 1599 1960 1351 1207 1372 128 500 1000 1500 2000 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 # of Wells Drilled

Unconventional Shale Well Drilled

03/12/2015

3987 4663 4838 4657 2026 1733 1271 1019 956 789 54

1000 2000 3000 4000 5000 6000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

# of Wells Drilled Year

Conventional Wells Drilled

03/12/2015

Department of Environmental Protection Office of Oil and Gas Management Unconventional Wells Drilled in 2014

Department of Environmental Protection Office of Oil and Gas Management Conventional Wells Drilled in 2014

11,332 14,651 16,504 24,275 26,936 26,770 26,940 3,665 1,262 2,350 5,245 10,563 12,680 12,391 11,265 1,814 10,058 12,226 10,703 12,589 11,762 11,713 12,489 1,445 12 75 556 1,123 2,494 2,666 3,186 406 1,500 3,000 4,500 6,000 7,500 9,000 10,500 12,000 13,500 15,000 16,500 18,000 19,500 21,000 22,500 24,000 25,500 27,000 2008 2009 2010 2011 2012 2013 2014 2015

Compliance Inspections January - February

Total Inspections Unconventional Inspections Conventional Inspections Client/Site Inspections 03/12/2015

6,198 6,349 7,250 7,508 9,766 9,642 12,726 12,603 13,367 13,152 2,515 13 38 87 379 925 2,003 3,930 4,838 5,559 5,000 1,313 6,185 6,311 7,163 7,129 8,841 7,639 8,796 7,765 7,808 8,152 1,202 2,000 4,000 6,000 8,000 10,000 12,000 14,000 16,000 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Wells Inspected January - February

Total Wells Inspected Unconventional Wells Inspected Conventional Wells Inspected 03/12/2015

1,520 3,372 2,873 4,104 3,368 2,632 2,445 197 237 682 1,281 1,225 707 512 412 46 1,265 2,626 1,261 2,089 2,055 1,590 1,449 81 18 64 331 790 606 530 584 70 200 400 600 800 1,000 1,200 1,400 1,600 1,800 2,000 2,200 2,400 2,600 2,800 3,000 3,200 3,400 3,600 3,800 4,000 4,200 4,400 2008 2009 2010 2011 2012 2013 2014 2015

Total Violations Unconventional Violations Conventional Violations Client/Site Violations 03/12/2015

Compliance Violations January - February

747,149 1,901,221 9,770,775 78,417,407 193,494,838 270,501,154 435,039,135 629,236,438 894,940,091 1,146,799,269 1,405,371,222 1,697,464,205 1,940,749,367 2,129,829,933

• 350,000,000

150,000,000 650,000,000 1,150,000,000 1,650,000,000 2,150,000,000 Jan-Dec 2006 Jan-Dec 2007 Jan-Dec 2008 Jan-Dec 2009 Jul 2009- June 2010 Jul-Dec 2010 Jan-Jun 2011 Jul-Dec 2011 Jan-Jun 2012 Jul-Dec 2012 Jan-Jun 2013 Jul-Dec 2013 Jan-Jun 2014 Jul - Dec 2014

Unconventional Shale Wells Gas Production (MCF)

848 1,215 1,643 2,248 2,878 3,564 4,237 4,944 5,406 6,068 1,000 2,000 3,000 4,000 5,000 6,000 7,000 Jul 2009-June 2010 Jul-Dec 2010 Jan-Jun 2011 Jul-Dec 2011 Jan-Jun 2012 Jul-Dec 2012 Jan-Jun 2013 Jul-Dec 2013 Jan-Jun 2014 Jul - Dec 2014

Unconventional Shale Wells Reporting

Unconventional Shale Well 2013 – 2014 (Jan-Jun) Liquid Waste Summary

Recycled Treatment Prior To Recycling Other (2.2%) Injection Disposal Well Total: 48,614,321.1 Bbls

82.0% 5.8% 10.0%

• Compliance and Enforcement Policy

– “Standards and Guidelines for Identifying, Tracking, and Resolving Oil and Gas Violation” – Finalized: January 17, 2015

• Recent Enforcement Actions

Enforcement

16

• Background of Rulemaking
• Bifurcation
• Current Status
• Conventional and Unconventional Changes

Surface Activities Rulemaking

17

• Proposed regulation published 12/14/2013
• 90-day public comment period
• Nine public hearings – 300+ persons testified
• Public Comments

– Around 25,000 letters, emails, petitions, etc. – 1,200-1,500 unique comments/commentators – Around 22,000 form letters, petition signatures

Surface Activities Rulemaking

18

• Act 126 of 2014 requires regulations relating

to conventional oil and gas wells to be promulgated separately from regulations relating to unconventional wells.

• DEP is proceeding with one process to

promulgate separate rules.

• Chapter 78 – Conventional
• Chapter 78a – Unconventional

Bifurcation

19

• March 20, 2015 – Oil and Gas Technical

Advisory Board (TAB) – Ch. 78a (unconventional)

• March 26, 2015 – Conventional Oil and Gas

Advisory Committee (COGAC) – Ch. 78 (conventional)

• April 4, 2015 – Advanced Notice of Final

Rulemaking – 45 days public comment, 3 public hearings.

Current Status

20

• Requires operators to demonstrate that

streams and wetlands will be protected if the edge of the pad is within 100 feet of the resource

• Eliminates the use of waste storage pits for

unconventional operators

Protects Water Resources

21

• Requires centralized wastewater

impoundments to be permitted through more appropriate Residual Waste Regulations

• Requires existing centralized wastewater

impoundments to be upgraded and re- permitted, or closed within 3 years of the rule’s effective date

• Adds a new section to create a centralized

tank storage permit

Protects Water Resources (cont.)

22

• Expands impacts analysis of public resources
• Includes additional public resources for

consideration:

• Schools
• Playgrounds
• DEP-approved wellhead protection areas

Adds Public Resources Considerations

23

• Requires operators to identify active and

inactive wells within a specific area of the well bore and submit a report and plan to DEP at least 30 days prior to drilling

• Adds a monitoring plan component
• Makes explicit that water supply must be

restored to the better of pre-drill conditions or Safe Drinking Water Act standards

Protects Public Health and Safety

24

• Creates new Noise Mitigation section for

unconventional only

• Requires operators to prepare and implement

a site-specific noise mitigation plan for drilling, stimulation and servicing activities

• Gives DEP the ability to suspend operations

and modify the plan

• Adds requirements to inform surface

landowners of certain activities

Addresses Landowner Concerns

25

• Adds new notification requirements
• Requires all notifications to be submitted

electronically

• Requires all documents and reports to be filed

electronically

• Provides efficiencies for DEP inspections
• Sets the stage for more use of Internet-based

submission and management

Enhances Transparency and Data Management

26

• March/April 2015: Advisory committee review
• April 4, 2015: Advanced Notice of Final

Rulemaking

• Summer 2015: Additional advisory

committees discussions

• Late 2015: Final form to Environmental

Quality Board

• Spring 2016: Rules become effective

Next Steps

27

• Conceptual Changes Presentation – June 2014
• Proposed Rulemaking – Fall 2015
• Purpose: To update the Department’s

regulations relating to well construction and

• peration, including new casing and

cementing standards, new inactive status requirements, as well as new plugging standards.

Subchapter D Rulemaking

28

• Policy Initiatives

– Data Management – Health and Environment Studies – Staff and Industry Training – Public Engagement

Future Projects

29

Questions?

Scott Perry scperry@pa.gov 717-778-9438 Elizabeth Nolan elnolan@pa.gov 717-787-7060

These materials do not necessarily reflect the views of the Commonwealth, the Office of General Counsel or the PA Department of Environmental Protection.