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Leaders say gov. veto will hit county hard

Photo submitted to Warren County Industry leaders have called for separate regulations for conventional oil and gas operations such as this. An attempt in that direction was recently vetoed by Gov. Tom Wolf.

Last month, Gov. Tom Wolf vetoed a bill that would have created separate regulations for the conventional oil and gas industry.

He said SB 790 would have rolled back environmental regulations and “poses an unacceptable risk to the environment and public health and safety of our citizens.”

Environmental groups agree — the Pennsylvania Environmental Council was opposed “due to its weakening of environmental and public health protections” and the legislation’s “unraveled standards that have been in place and practiced by the industry for decades.”

But industry leaders in Warren County claim that the veto shows a “bias against fossil fuels” and “no sound science.”

Any legislation that impacts oil and gas regulations is going to hit Warren County hard.

This map shows all of the active oil and gas wells in the county. All are conventional except for one — the red dot just east of Youngsville.

According to the Department of Environmental Protection, there are 18,899 active oil and gas wells in the county.

The lion’s share of those wells are active oil wells — 15,371.

While wells can be found in every corner of Warren County, the density is much higher in the portion of the county that is also part of the Allegheny National Forest.

The industry has been a key fabric of the county’s economy since shortly after Col. Drake struck oil outside Titusville.

It wasn’t until earlier this decade as unconventional shale development started to enter the marketplace that the state rolled the regulations for both conventional and unconventional operations into one piece of legislation.

David Clark, president of the Pennsylvania Grade Crude Oil Coalition, said that’s like “regulating horse racing and NASCAR under the same rules.

“A separate bill was needed to recognize the very different characteristics of Pa. conventional wells, such as smaller footprint, smaller well pressures and radically different economics,” he added.

He explained that the recently-vetoed legislation was years in the works and included “a lengthy list of modernizations from Act 13 synch as limiting operations in floodplains, setbacks from wetlands and increased DEP enforcement authority, just to name a few.”

He also said the industry conceded on the issue of brine road spreading.

Citing a study that shows the conventional industry generates $1.4 billion in western Pennsylvania, Clark asked “Is it too much to ask for a law that actually fits that industry and not the very different Marcellus shale industry?

“I think that most hard-working intelligent citizens, who enjoy homes heated by natural gas, vehicles powered by gasoline and computers built from petrochemicals — all of which we produce — would agree that a separate bill for conventional oil and gas makes good sense.”

“The economic impact of not having a separate status for conventional operations has been devastating,” Arthur Stewart, secretary of the coalition added.

“Before the combined oil and gas statute was passed in 2012, Pa.’s conventional industry was routinely drilling several thousand new wells per year. Since then, conventional drilling has collapsed. In the last two years there have been less than 200 new conventional wells drilled, in the entire state, each year.”

He acknowledged that commodity prices have played a role in that decline “but much of the decline is associated with requirements for the unconventional shale industry.”

Stewart specifically cited requirements for well-casing that “make sense for high pressure unconventional wells” but are “not sensible for conventional wells, and the added costs lends to the unprofitability of drilling new conventional wells.”

Both Stewart and Clark detailed challenges with finding places to accept wastewater, as well.

“The impact to Warren County has been harsh,” Stewart added. “Local supply stores and service companies have closed.”

He said his business has had to eliminate overtime and other benefits for over 30 employees and said he has a “thick stack of applications from men and women who have been laid off.

“Many hours of negotiation were put into SB 790, and the bill contained numerous items requested by DEP. As chairman of the Pa. Crude Oil Development Advisory Council, I was personally involved in those efforts.

“I think the governor’s veto represents a bias against fossil fuels, no sound science.”

That sentiment, though, is by no means unanimous.

First and foremost — the governor himself: “At a time when the conventional industry is still incurring violations at three to four times the rate of the unconventional industry, this legislation is completely unacceptable,” he wrote in a letter to the General Assembly announcing the veto.

Data from DEP provided last week show 71 violations in 2020, down from 182 in 2019 and 252 in 2018. That’s down from 303 in 2013.

“(S)everal provisions in the bill relating to burdens of proof, municipal input, public participation and inadequate authority to regulate and enforce environmental standards run afoul of the Pennsylvania Constitution and, based on precedent, would likely not withstand judicial scrutiny,” Wolf added. “The substantive issues outlined herein only address a fraction of the concerns related to this legislation.”

Environmental groups have also opposed the legislation since the beginning.

A September 2019 letter to the Senate Environmental Resources and Energy Committee from the Pennsylvania Environmental Council and Environmental Defense Fund called on the state to redefine conventional and unconventional operations along the line of which “employs high volume fracturing.”

They raised concerns in several areas from orphaned wells to mechanical integrity and surface casing as well as bonding and plugging issues.

The Times Observer previously reported that the Environmental Defense Fund opposed the change, saying the legislation removed a state requirement that oil and gas drillers must provide replacement sources of drinking water if they if wells are contaminated by drilling operations. Likewise, the EDF opposed limits on oil and gas companies’ financial responsibility to clean up orphaned or abandoned wells.

With the veto in hand, where these issues go next isn’t clear.

The Pittsburgh Post-Gazette reported earlier this month that DEP indicated during an industry advisory committee meeting that it would be developing a set of rules for waste management and above-activities at conventional sites that could be presented in draft form to an environmental board sometime next year.

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