Pennsylvania

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    PA DEP Secretary John Hanger Summons Marcellus Shale Drilling Companies to a May Meeting

    PA DEP Sec. John Hanger The PA Department of Environmental Protection (DEP) is summoning all Marcellus gas drillers operating in Pennsylvania to meeting. MDN wouldn’t exactly use the term “mandatory attendance required” to describe the meeting, but reading between the lines it certainly seems that way.

    MDN welcomes the DEP keeping a close eye on drillers, especially in the aftermath of Dimock. However, the tone of the press release is confrontational and bullyish, rather than collaborative and respectful.

    From the official DEP summons press release:

    HARRISBURG—Department of Environmental [Protection] Secretary John Hanger announced today that he has called a meeting of oil and gas companies with permits to drill in the Marcellus Shale to discuss what steps the industry must take to prevent gas migrating from wells and polluting Pennsylvania’s natural resources, which can create a public safety risk.

    The meeting will be held on May 13 in Harrisburg.

    “The Department of Environmental Protection has a constitutional and statutory obligation to protect Pennsylvania’s environment. That right is not for sale and is not subject to compromise,” said Hanger.

    “Drilling for natural gas beneath our soil can be done responsibly without putting the citizens of Pennsylvania, their property or livelihoods at risk,” added Hanger. “I am urging the industry to come and discuss how to effectively and safely prevent gas migration, protect our natural resources, and ensure that what happened to the residents of Dimock Township, Susquehanna County, does not happen elsewhere.”

    Last week, DEP took further action against Cabot Oil & Gas Inc. after it failed to address migrating gas discovered in 2009 from drilling operations that contaminated groundwater and the drinking water supplies of 14 homes in the region.

    “Gas migration is unacceptable and the department is taking every precaution necessary to address this issue to protect our citizens and their communities,”   Hanger added. “In addition to increased oversight, the department has proposed tougher regulations to meet the growing demand and new drilling technologies including improving well construction standards to protect from gas migration.”

    PA DEP Press Release (Apr 20) – DEP to Meet With Drilling Companies to Discuss Ways to Prevent Dangerous Gas Migration Situations, Safeguard Homes, Water Supplies

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    Delaware River Basic Commission Continues to Obstruct Drilling in PA

    The Delaware River Basin Commission (DRBC) continues to obstruct drilling in the Marcellus Shale in Pennsylvania. The latest energy company to experience frustrations in dealing with the DRBC is Hess, which holds leases to 126,000 acres in Wayne County, PA:

    “It’s a big issue,” said Gene Linscomb, a Hess Corp. business manager based in Honesdale. “We’re asking them [the DRBC] for input.”*

    The thing is, the DRBC has not approved a single, solitary Marcellus shale operation in the watershed. Not one.

    The commission, a West Trenton, N.J.-based regulatory authority that has jurisdiction over water resources in the 13,539-square-mile Delaware River watershed, has yet to green light a single natural gas production well.*

    Hess has been asking the DRBC, repeatedly, what they want them to do so Hess can begin to drill.

    The [DRBC] has stated it does not intend to be a roadblock to natural gas development – something many Wayne County residents who signed leases do not believe.*

    So what is the DRBC doing? They’ve requested $250,000 to do a study about drilling in the Marcellus Shale in the watershed. They’re hoping to get federal money for the study “late this year.” In other words, they’re not doing anything. If you’re a landowner in the Delaware River Basin, or a drilling company, don’t hold your breath for drilling to begin any time soon.

    *Scranton Times Tribute (Apr 17) – Hess to Wayne County: ‘(We’re) here for the long term’

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    Opinion: How the AP and Other Media Outlets “Wag the Dog” Against Drilling in the Marcellus Shale

    Google News Search "Louis Matoushek" MDN notes with some amusement how news is manufactured—and is thankful blogs are around to help set the story straight. Case in point: A few days ago the Associated Press ran a single story about the “raging debate” over gas drilling in Northeast Pennsylvania. While the drilling debate is certainly ongoing, and there are plenty of people on both sides of the debate, the AP story would have us believe the forces of good (people against drilling) are rising up in overwhelming numbers to oppose the forces of evil (the nasty energy companies who want to rape and pillage the unspoiled landscape, along with the greedy landowners who enable them).

    That single AP anti-drilling story was picked up by no less than 250 media outlets, including large city newspapers, television stations and everything down to small town newspapers—all in the course of two days. One would have to be blind to miss the coverage and not think, “Maybe there are a lot of people opposed to drilling after all!” And all from a single story run again and again and again.

    The AP story starts this way:

    A few hundred yards from Louis Matoushek’s Wayne County farmhouse is a well that could soon produce not only natural gas, but a drilling boom in the wild and scenic Delaware River watershed.

    Energy companies have leased thousands of acres of land in Pennsylvania’s unspoiled northeastern tip, hoping to tap vast stores of gas in a sprawling rock formation—the Marcellus shale—that some experts believe could become the nation’s most productive gas field.*

    But wait, it’s not enough that the villainous drilling companies want to spoil the unspoiled land in PA. While that argument will sway some readers, let’s throw in the thing that works every time, the one thing that will magically turn everyone against drilling: Water.

    Standing in the way is a loose coalition of sporting groups, conservationists and anti-drilling neighbors. They contend that large-scale gas exploration so close to crucial waterways will threaten drinking water, ruin a renowned wild trout fishery, wreck property values, and transform a rural area popular with tourists into an industrial zone with constant noise and truck traffic.

    Both sides are furiously lobbying the Delaware River Basin Commission, the powerful federal-interstate compact agency that monitors water supplies for 15 million people, including half the population of New York City. The commission has jurisdiction because the drilling process will require withdrawing huge amounts of water from the watershed’s streams and rivers and because of the potential for groundwater pollution.*

    PA learns fast. They look over the border at New York where City politicians bleat about the New York City watershed as if drillers are about to poison the water supply of the entire City, and say, “Hey, if it works for them, maybe it will work for us.” And so, the shrill voices in PA have found their argument: Drilling pollutes water. Run the story (i.e. lie) enough times and after a while people will believe it.

    Don’t fall for the lie. And landowners: Make your voices heard!

    *Pittsburgh Tribute-Review/AP (Apr 19) – Gas-drilling foes fear for local water supplies

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    MarkWest Expands Marcellus Shale Gas Processing Capacity in West Virginia & Pennsylvania

    MarkWest Liberty Midstream & Resources—also known as MarkWest Energy—announced today it is expanding its processing and fractionation capacity in the Marcellus Shale in West Virginia (Marshall County) and Pennsylvania (Washington County). What exactly does that mean, and why should landowners care? MarkWest is a “midstream” company, providing processing, storage, transportation and marketing for natural gas. Think of midstream companies as bridges between energy companies that do the drilling, and the large pipelines that deliver natural gas to buyers. Along the way the gas must get from the well to a processor where it’s cleaned up and separated into different products. There are different types of chemical compounds in “natural gas” and impurities must be removed before it’s saleable. MarkWest provides processing, fractionation (a separation process), pipelines, compressor facilities and more.

    The MarkWest announcement means drillers will have more capacity to clean up, transport and market the gas they discover. More capacity expands the market. The MarkWest announcement says they have “reached definitive agreements” which will allow them to expand operations, but it does not say which energy companies those agreements have been made with.

    From the MarkWest press release:

    Read More “MarkWest Expands Marcellus Shale Gas Processing Capacity in West Virginia & Pennsylvania”

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    Range Resources Meets with Murrysville, PA Residents to Discuss Drilling Near Residential Areas

    The Pittsburgh Post-Gazette published a good account of a meeting between Range Resources and residents from the Murrysville (Westmoreland County, PA) area about Range’s plan to drill a Marcellus Shale gas well in that area.

    Range Resources has submitted a plan to drill on a 6.1-acre parcel that is near the intersection of Saltsburg and Logans Ferry roads, an area that is in close proximity to the Murrysville/Plum border, along with the heavily traveled Golden Mile Highway and several business and residential areas.

    A packed audience in the Franklin Regional High School auditorium listened intently, then lathered the Range Resources contingent with questions about how the drilling—scheduled to begin in late 2010 or early 2011—will affect those living in the affected area.*

    Water contamination, truck traffic, road damage and other questions were discussed in a 3-hour session with Range. Read the full article for more.

    *Pittsburg Post-Gazette (Apr 15) – Marcellus shale meeting held

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    PA DEP Takes Aggressive Action Against Cabot Oil & Gas over Dimock Township Methane Contamination

    The Pennsylvania Department of Environmental Protection (DEP) is not happy with what it says is lack of progress on the part of Cabot Oil & Gas in the remediation of methane contamination of water supplies in Dimock Township, PA. The DEP blames Cabot for the methane contamination. Cabot claims they really aren’t at fault and are being unfairly blamed for a naturally occurring phenomenon (migrating natural gas).*

    Today’s consent order from the DEP stipulates that Cabot must:

    • Plug three wells believed to be the source of the migrating methane gas—within 40 days.
    • Install permanent water treatment systems in the affected 14 homes.
    • Pay $30,000 per month in fines, starting in May, until all obligations are met.

    In addition:

    • The DEP is immediately suspending reviews of any pending Cabot permits to drill elsewhere in the entire state.
    • Cabot is barred from drilling any new gas wells in Dimock Township for at least one year.

    From the DEP press release:

    Read More “PA DEP Takes Aggressive Action Against Cabot Oil & Gas over Dimock Township Methane Contamination”

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    Chesapeake Energy’s Permit to Use State Route 1007 in Bradford County Revoked Until Damage is Repaired

    Bradford-County-SR-1007 Chesapeake Energy’s permit to use a PA State Route in Bradford County has been revoked—now a second time—by the Pennsylvania Department of Transportation (PennDOT).

    From the PennDOT press release:

    HARRISBURG, Pa., April 15 — A road use permit issued to Chesapeake Energy Corporation for moving its drilling trucks and other equipment over State Route 1007 in Bradford County was revoked because of the company’s failure to deal with severe damage to the roadway, Transportation Secretary Allen D. Biehler, P.E., announced today.

    Chesapeake was granted a permit to put heavy trucks and equipment on the road, known locally as Spring Hill Road in Tuscarora and Stevens townships. The road normally has a 10-ton weight restriction, and Chesapeake’s permit carried the understanding the company would be responsible for repairs.

    “Chesapeake may not use this route until it makes the required repairs,” Biehler said. “We understand the importance of Marcellus Shale drilling to the region’s economy, but we will remain vigilant in requiring action to keep the roads safe and properly maintained for public use.”

    PennDOT revoked the permit after Chesapeake failed to respond to two notices of unsafe conditions on the roadway. Under the terms of the permit, Chesapeake is to proactively monitor pavement conditions and immediately begin repairs as needed to keep the road safe.

    On March 1, PennDOT revoked Chesapeake’s permit for State Route 1001 in Bradford County for the same reasons. The permit was restored after the road was closed for about one week and the company made the required repairs.

    *PR Newswire (Apr 15) – PennDOT Revokes Road Use Permit for Chesapeake Energy Corporation on State Route 1007 in Bradford County Until Repairs Are Made

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    Lehman Township, PA Approves Encana Plan to Begin Drilling This Summer

    Encana has gotten a green light from the supervisors in Lehman Township (Luzerne County, PA) to begin drilling this summer. The board approved an ordinance allowing the drilling to begin. According to Township Zoning Board Solicitor Jack Haley, the supervisors had little choice:

    According to Haley, all authority to halt drilling operations in any municipality in Pennsylvania lies in the hands of state agencies, not local governments. The township’s rules are “superseded” by the state Oil and Gas Act, he said.

    The state Supreme Court already reviewed two similar cases, he added, and decided the only authority Lehman Township has applies to what roads EnCana can use.*

    As for the motion/ordinance and what it says about the roads:

    [Board of Supervisors Vice Chairman Ray] Iwanowski outlined six conditions to the motion: that EnCana put up $13,540 to maintain Firehouse Road through the total time it is used; EnCana put up $32,192 to maintain Peaceful Valley Road similarly; all traffic related to the drilling traverse on Firehouse Road toward state Route 118; no traffic will go on Old Route 115 in the township (near the school); EnCana provide adequate insurance coverage for the township, and that a legally binding agreement be signed by EnCana holding it to its commitment.*

    *Wilkes-Barre Times Leader (Apr 14) – Lehman Township says yes to gas drilling

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    Penn State to Monitor 50 Water Wells to Measure Marcellus Drilling Affects on Water Supplies

    Penn State will monitor water wells in Pennsylvania to see if they are affected by drilling activity. MDN applauds this effort:

    Penn State’s School of Forest Resources along with several Penn State Cooperative Extension county offices have received funding from the Center for Rural Pennsylvania and the Pennsylvania Water Resources Research Center to conduct a research study on the potential impacts of Marcellus gas drilling on rural drinking water supplies.

    The data collected from the study is for research purposes, Penn State officials said.

    About 50 private water wells will be selected for free water testing of 15 water quality parameters. Water samples will be collected by trained Penn State researchers both before and after nearby Marcellus gas well drilling has occurred.

    Interested residents of the southwest region of Pennsylvania can take the eligibility survey here, call Dana Rizzo at 724-837-1402 or e-mail.*

    *Fayette Daily Courier (Apr 12) – Ongoing Penn State study planned on impact of gas drilling

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    Joint Venture Between Reliance Industries and Atlas Energy Worth $3.5 Billion Over 10 Years

    Indian energy giant Reliance Industries Limited (RIL) has entered a joint venture with Atlas Energy (based in Pittsburgh). MDN previously reported on the rumors of an impending deal between the two companies. Reliance, India’s largest energy company and one of the largest energy companies in the world, will get 40 percent (120,000 acres) of Atlas Energy’s Marcellus Shale leases as part of the deal. The terms are a bit complex, but in the end, this is the largest deal to date between energy companies in the Marcellus Shale with a value of $3.5 billion over 10 years:

    Reliance will bear an acquisition cost of $339 million and pay an additional $1.36 billion as capital costs for the development programme over seven and a half years.

    However, the investment would be scaled up to $3.5 billion over the next 10 years, RIL CFO Alok Agarwal said today in Mumbai.

    The acreage will support the drilling of over 3,000 wells with a net resource potential of approximately 13.3 tcfe (5.3 tcfe net to RIL).*

    From the Atlas press statement:

    Atlas Energy, Inc. (“Atlas” or “the Company”) announces today its entry into a joint venture transaction with a wholly owned affiliate of Reliance Industries Limited (“Reliance”), the largest private sector company in India and a global energy leader, pursuant to which Atlas will transfer an interest in its Marcellus Shale position equal to 120,000 net acres in a transaction valued at $1.7 billion. Reliance will pay approximately $340 million in cash upon closing and an additional $1.36 billion in the form of a drilling carry. Atlas will serve as the development operator for the joint venture. Reliance will have the option to operate in certain project areas in the coming years outside of Atlas’ core operating areas of Fayette, Greene, Washington, and Westmoreland Counties in southwestern Pennsylvania.

    Read More “Joint Venture Between Reliance Industries and Atlas Energy Worth $3.5 Billion Over 10 Years”

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    PA Town Proactively Protecting Area Roads from Marcellus Drilling Truck Traffic

    The elected supervisors of Ross Township (Luzerne County, PA) are being proactive about protecting the roads in the township:

    In August, Municipal Solutions of Linden, Pa., visited the township and inspected the construction of the roads to determine weight limits. Supervisors started the process as a proactive measure to protect them from damage that might be caused by heavy trucks carrying Marcellus Shale gas drilling equipment through the township.

    Once weight limits are posted, it would require the gas exploration company to pay for any damages caused by trucks exceeding the weight limit.*

    Seems to MDN this is a common sense precaution that other communities may also want to adopt.

    *Wilkes-Barre Times Leader (Apr 7) – Ross Twp. addressing road protection

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    PA Secretary of Environmental Protection Says Marcellus Wastewater Discharge is Affecting Waterways

    The Pennsylvania Secretary of the Department of Environmental Protection (DEP), John Hanger, released a press statement yesterday expressing concerns over Marcellus drilling wastewater being released into PA waterways.

    From the DEP website:

    HARRISBURG — High levels of total dissolved solids pollution from natural gas drilling and other sources pose a real threat to Pennsylvania’s streams and rivers, including aquatic life, warned Department of Environmental Protection Secretary John Hanger today.

    “The treating and disposing of gas drilling brine and fracturing wastewater is a significant challenge for the natural gas industry because of its exceptionally high TDS concentrations,” said Hanger. “Marcellus drilling is growing rapidly and our rules must be strengthened now to prevent our waterways from being seriously harmed in the future.”

    Hanger pointed to recent examples where TDS impaired streams and affected major sources of drinking water.

    In 2008 and 2009, TDS levels exceeded drinking water standards along the Monongahela River, which is a major source of drinking water. Drinking water treatment plants do not have the equipment available to remove TDS, so any water polluted with TDS goes into Pennsylvania’s homes and businesses.

    Similarly, in early September 2009, excessive TDS levels led to an environmental disaster that wiped out 26 miles of Dunkard Creek in Greene County, as well as many miles of the creek in West Virginia. These high TDS concentrations, coupled with other factors such as temperature and nutrient concentrations, enabled golden algae to bloom and created an inhospitable environment for aquatic life. The algae released toxins to the water column that literally wiped out aquatic life, including at least 16 species of freshwater mussels and 18 species of fish.

    Dunkard Creek is an example of what can happen if TDS is not controlled, said Hanger, and the loss of this important public resource was an environmental and economic tragedy.

    TDS is a measure of all elements dissolved in water that can include carbonates, chlorides, sulfates, nitrates, sodium, potassium, calcium and magnesium. In addition to natural gas drilling, other sources of TDS include, abandoned mine drainage, agricultural runoff, and discharges from industrial or sewage treatment plants.*

    *DEP Press Release (Apr 6) – PA Must Take Action to Protect Water Resources from Drilling Wastewater, Other Sources of TDS Pollution

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    Proposed New Marcellus Wastewater Treatment Plant Shifts from Athens Township to Tuscarora Township

    After getting turned down by the supervisors in Athens Township, PA, Somerset Regional Water Resources is now planning to build a Marcellus wastewater treatment plant in nearby Tuscarora Township. Both Athens and Tuscarora are located in Bradford County in Northeastern Pennsylvania.

    A search of DEP permit applications confirms that Somerset has applied for a permit to use the former Cornell Manufacturing building (more recently Pendu Manufacturing) just off Route 6 in Tuscarora Township at the intersection of Township Roads 524 and 494. The new name for the facility, as stated in the permit application, is the Tuscarora Township Wastewater Treatment Facility. It is actually in the first phase of the permitting process, having completed the preliminary administrative review and now into what is known as the technical review.*

    Supervisors in Tuscarora have not yet been approached by Somerset to officially request permission to proceed, a step that will have to come soon in the process. If the supervisors approve the facility, it will also require approval from the PA State Department of Environmental Protection, which is estimated to take between 12-18 months.

    If all goes according to plan, the facility will employ about 40 people. It is projected there will be about 180 truck trips in and out of the facility per day once it’s operational.

    *Wyalusing Rocket-Courier (Apr 1) – Gas Well Water Treatment Plant Proposed at Former Cornell Plant in Tuscarora Township

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    Mud Spill at Drilling Site in Central PA Due to Human Error

    There was a mud spillage at a drilling site on Friday, April 2nd in Pennsylvania. The site is located on state-owned land—the Sproul State Forest in north-central Pennsylvania. The drilling was being done by Anadarko. According to reports:

    An estimated 8,000 to 12,000 gallons of mud used by Anadarko E&P Company Inc. for drilling operations overflowed at the well site due to human error, said Daniel Spandoni, spokesman for the Department of Environmental Protection in Williamsport.

    While about half of the mud spilled over the boundary of the well pad, it didn’t spread far enough to contaminate any surface waters, ground water or wetlands in the area, Spandoni said. A contractor began cleanup work Friday night. DEP officials have taken mud samples to determine a proper disposal method.

    The mud is used as a cooling agent in drilling operations. Since the mud that spilled is synthetic-based, it doesn’t contain any diesel fluids as some other agents do, said Spandoni.*

    *Hazelton Standard Speaker (Apr 2) – Mud spill at drilling site contained

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    Six Short-Line Railroads in Central PA Report Business is Up 40 Percent Because of Marcellus Drilling

    MDN previously reported on two short-line railroads that have seen their prospects dramatically improve with Marcellus drilling activity in Pennsylvania—the Wellsboro & Corning Railroad and the Reading & Northern Railroad. You can now add six more short-lines to the list—all of them owned by the North Shore Railroad Company.

    A system of six railroads in northcentral Pennsylvania, including the Lycoming Valley Railroad Co., is enjoying a 40 percent increase in business over last year’s first quarter, said chairman and CEO Richard Robey.

    “We have seen a substantial increase in business related to the Marcellus Shale gas well drilling,” Robey said Wednesday.

    Before that, the recession had sliced the railroads’ business by nearly 20 percent, as it hauled fewer loads of iron and steel products and scrap, food stuffs and plastics to manufacturers, he said.*

    Once again the main product being hauled is sand, which is mixed with water and chemicals and injected into well bores as part of the process to free trapped natural gas from the shale.

    *Charleston Daily Mail (Mar 31) – Railroads booming with Marcellus Shale business

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    PA Oil and Gas Association, Independent Oil and Gas Association Merging into One Organization

    From the press announcement:

    WEXFORD, PA – The Pennsylvania Oil and Gas Association (POGAM) and the Independent Oil and Gas Association of Pennsylvania (IOGA) today announced they have unanimously voted to merge their organizations to create a single, comprehensive trade association representing oil and natural gas interests throughout Pennsylvania.  The new organization, named the Pennsylvania Independent Oil and Gas Association (PIOGA), will represent approximately 700 members, including oil and natural gas producers, drilling contractors and service companies, as well as various professional firms, individuals and royalty owners.

    “The Pennsylvania Independent Oil and Gas Association will draw upon the combined expertise of our independent associations to better serve the needs of our member organizations, which represent the leading oil and natural gas producers working in the Commonwealth,” said PIOGA President and Executive Director Lou D’Amico. “By joining forces as one, unified voice, we will expand our mission to achieve even greater success for our members, including our role as liaison with other associations, companies, government and regulatory agencies to foster proactive communication, regulatory and policy development, work force and safety training, and continued education and growth within all segments of the industry.”

    PIOGA will be based in Wexford, Pa. and will employ a five-person staff, responsible for planning and implementing the association’s mission. In addition, PIOGA’s merged 29-member board will provide oversight, as well as govern the strategic planning and direction of key deliverables, while various committees oversee transportation, safety, environmental, and exploration and production initiatives. PIOGA will host an annual meeting, a large-scale conference and trade show, as well as yearly industry seminars, public educational meetings, and community events.

    “This merger is an important milestone in leveraging the industry’s common goal to operate under a unified framework that advances the responsible exploration and production of both the Marcellus Shale and other oil and gas producing formations throughout the Appalachian Basin,” said current POGAM Chairman Frederick Fesenmyer. “The entire industry is experiencing unprecedented growth, and the importance of a united, cohesive industry and community advocate cannot be overstated.  PIOGA will equally represent all facets of Pennsylvania’s oil and natural gas industry.”

    “We look forward to working closely with other states’ associations to collaborate on key initiatives that advance the industry and ensure the responsible development of our region’s promising domestic energy resources,” said current IOGA Chairman Craig Neal.

    The PIOGA board of directors will meet on April 1 to determine the structure and officers of the new association.

    *Pennsylvania Oil and Gas Association (Mar 30) – Members give unanimous approval to merge PA’s historic, independent oil and gas advocacy groups