Guest Author

A legal plan to control drilling

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by David Slottje, JD and Helen Holden Slottje, JD – Community Environmental Defense Council, Inc.
What comes to mind when you think about upstate New York? Rolling farmlands, fresh air, and the chirping of birds? Or heavy truck traffic at all hours of the day and night, the smell of chemicals in the air, distant views pockmarked with drilling rigs, and the stars blocked from sight by light pollution?

Many community groups and municipal leaders are becoming increasingly alarmed by the threats attendant to unconventional gas drilling. These communities are growing frustrated with what they perceive to be the unwillingness of state and federal politicians and agencies to act decisively. Can anything be done at the local level to protect the health and welfare of our communities? The answer is yes, at least in New York.

We are lawyers with the Community Environmental Defense Council, Inc., a pro bono, public interest environmental law firm based in Ithaca. It is our opinion that a New York municipality has the legal authority and right to use land-use laws of general applicability (such as zoning laws) to prohibit what we have termed “high-impact industrial uses,” either in certain zoning districts or throughout an entire town.

Furthermore, we believe this authority and power legally may be exercised in a manner that, depending upon the municipality’s particular definition of “high-impact industrial uses,” will have the incidental effect of prohibiting (within the town) land uses such as unconventional gas drilling.

Some people have heard that municipalities are legally restricted from enacting laws to prohibit certain uses, such as “adult entertainment,” and so they wonder whether those same restrictions might also apply to banning industrial uses. They do not.

Those restrictions on “adult entertainment” are very limited and very specific in nature, and have to do with protection of constitutional rights, specifically First Amendment rights, including free speech.

There is no question that exclusion of industrial uses is a proper and legitimate use of land-use laws.

The United States Supreme Court addressed this question in a 1974 case known as Village of Belle Terre. In Belle Terre, the court stated that the town had wide latitude to use its zoning laws to protect the public welfare, and that the public welfare is spiritual, as well as physical, aesthetic and monetary. The court specifically held that a town may use its police power “to lay out zones where the blessings of quiet seclusion and clean air make the area a sanctuary for people.”

And the New York Court of Appeals — the highest court of New York State — came to the same conclusion in a 1996 case called Gernatt Asphalt Products. This was a situation in which a town had used its zoning power to ban mining as a permitted use, and the people who wanted to mine challenged the ban, saying that the ban involved unconstitutional exclusionary zoning.

We have never held that the exclusionary zoning test, which is intended to prevent a municipality from improperly using the zoning power to keep people out, also applies to prevent the exclusion of industrial uses. […] A municipality is not obligated to permit the exploitation of any and all natural resources within the town as a permitted use, if limiting that use is a reasonable exercise of its police power to prevent damage to the rights of others and to promote the interests of the community as a whole. (Emphasis added.)

So, there should be no doubt that a New York State municipality has the legal right to use land-use laws to ban industrial uses.

You may have heard the opinion that New York has preempted the right of municipalities to ban certain specifically articulated industrial uses — oil and gas drilling and solution mining — within their boundaries.

We believe that the state has not preempted such activities, so long as they happen to fall within the definition of “high-impact industrial uses” contained in a town’s properly enacted zoning law.

There is a state statute (the “drilling statute”) that precludes municipalities from regulating the oil, gas, and solution mining industries, but we believe “regulating” means regulating the operational processes of the industry—that is, things such as how deep they can drill or mine, and imposition of bonding requirements. Municipalities may, in fact, prohibit such industries outright, either in certain zoning districts or throughout an entire town.

The drilling statute language regarding regulation is almost identical to the language regarding regulation that was previously used in the context of the mineral mining statute, and in that context the Court of Appeals made it crystal clear that the scope of preempted regulation meant regulation related to operational processes, and that municipalities absolutely could prohibit mining outright, whether in certain zoning districts or throughout an entire town.

Simply put, our recommendation to New York State municipalities seeking to preserve their character and avoid industrialization is to adopt a zoning law or amendment that specifically prohibits high-impact industrial uses within the municipality, and to utilize a definition of “high-impact industrial use” which encompasses unconventional gas drilling and any other uses determined to be inimical to the municipality’s desired character and goals.

We do not believe that our interpretation is particularly bold, or visionary, or out-of-the box. Embracing our approach does not involve attempting to create new law, or attempting to overturn any law, or even trying to distinguish a holding in an unfavorable judicial decision.

There are people out there who do not agree with our approach. Our view is that the vast majority of them are people who have a financial stake in seeing drilling go forward: drilling companies and their lawyers, landowners who favor drilling, and their lawyers—many of whom will receive substantial fees if drilling is allowed to proceed.

We would be happy to speak with the representatives of any municipality, or any community group, who wish to discuss the concepts we are recommending, the specifics of creating the type of law we are suggesting, or how to minimize political and legal “push-back” risks. We are pro bono attorneys, which means we do not charge for our time.

David Slottje is executive director and senior attorney, and Helen Holden Slottje is managing attorney, at the Community Environmental Defense Council, Inc. (CEDC). Both are members of the Club’s Atlantic Chapter. CEDC is a 501(c)(3) non-profit, pro bono, public interest environmental law firm. For more information about CEDC or to contact the authors, visit CEDC’s web site.

Copyright SierraClub 2009

Guest Author

Press Release: CPNY – Attorney General’s Lawsuit Recognizes Dangers of Fracking

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AG’s Action Compels Feds to Protect Public Health

WATKINS GLEN, NY – A lawsuit by New York Attorney General Eric T. Schneiderman toforce the federal government to conduct a full environmental impact study of natural gasdrilling is a recognition of the considerable risks posed by hydraulic fracking, say membersof the grassroots Coalition to Protect New York.

“It’s regrettable that our attorney general has to go to court to force the federal governmentto do what it’s required to do under current law – protect the health and safety of itscitizens,” said Jack Ossont, spokesman for CPNY, which opposes the destructive process offracking. “We have no doubt that any rational, independent analysis of fracking will clearlyshow that the dangers far outweigh any short-term economic gains, which will benefit onlya very few anyway.”

Yesterday, Schneiderman filed a lawsuit against the federal government for its failure tocommit to a full environmental review of proposed regulations that would allow drillingfor shale gas – including the harmful technique known as fracking – in the Delaware RiverBasin.

The National Environmental Policy Act requires federal agencies to conduct a full reviewof actions that may cause significant environmental impacts. But, ignoring this law, theDelaware River Basin Commission– with the approval of its supporting federal agenciesincluding the US Army Corps of Engineers and the Environmental Protection Agency –proposed regulations allowing gas development in the Basin without undertaking any suchreview.

The proposed regulations allow high-volume hydraulic fracturing combined withhorizontal drilling (fracking) within the Basin. Fracking has been proven to pose graverisks to the environment, health, and communities. It involves the withdrawal of largevolumes of water from creeks and streams, frequent contamination of drinking watersupplies, the generation of millions of gallons of toxic waste that has to go somewhere,increased noise, dust and air pollution, and potential harms to community infrastructureand character from increased industrial activity.

“We want to thank the attorney general and all the groups involved in this matter, for pushing for an environmental impact study on fracking that should have beendone long ago,” said Ossont.

Kevin Bunger, a member of CPNY, said the attorney general’s lawsuit should allow for a full,independent, peer-reviewed study of the impacts of fracking.

“It’s irresponsible that we’ve allowed fracking to take place throughout the Northeastwithout any non-industry-funded, comprehensive analysis of its impacts on theenvironment and human health,” he said. “Of course, it hasn’t been done because a multi-state, multi-institutional, large-scale study would prove what we already know from avast array of evidence: that fracking contaminates drinking water and leads to wide-scale,probably irreversible pollution.”

CPNY members’ awareness of the destructive effects of fracking is also behind the group’sopposition to a landmark water withdrawal bill (S3798) now under consideration inthe state senate that would give away billions of gallons of New York’s waters to largeindustrial users, including the methane gas industry which requires vast amounts of waterfor its fracking operations. The assembly has already passed its version of the bill.

“There is considerable pressure on our elected officials to open our state to widespread,unregulated fracking,” said Ossont. “It’s up to the citizens of New York to tell our senatorsand representatives to do the right thing: stop and consider all the impacts. We’re beingtold that the methane gas beneath our feet presents a golden opportunity for our state andour country. But it’s fool’s gold. Fracking would ruin our environment and literally destroyour way of life.”

Contact: Jack Ossont, Coalition to Protect New York, (607) 243-7262

FracTracker Alliance

New Data.FracTracker Feature: Collecting Data with Forms

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Data.FracTracker users are now able to create a form (either as a link or an embed into another page) where people can enter new records into an editable dataset. This has applications for those of you who brave the elements collecting data in the field.

We at CHEC are very excited about this new, incredibly important feature and would like to thank Rhiza Labs for developing it. To learn more about how to use a form to enter data into Data.FracTracker click here, or press the “DataTool” button at the top of this page to try it out yourself.

Matt Kelso, BA

Problems with Abandoned and Orphaned Wells

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Left: Cabin Run orphaned oil well, Morgan County, Ohio. Many of the older oil and gas wells were either perfunctorily plugged, or else not at all. Right: The Pennsylvania DEP thinks this Bradford Township explosion in McKean County, PA might have been due to a nearby abandoned gas well that was drilled in 1881.

In April of 2000, the Pennsylvania Department of Environmental Protection (DEP) released a plan for dealing with the approximately 8,000 abandoned and orphaned oil and gas wells throughout the Commonwealth. This report singled out 550 wells that were especially problematic, and of those, 129 were flagged as the highest priority, with a point score of 30 or greater on their internal scale.

Eleven years later, there are over 8,500 abandoned and orphaned wells, and 186 with a point score of 30 or greater. Most likely, this increase doesn’t suggest newly abandoned wells so much as the discovery of additional old ones. After all, according to Independant Petroleum Association of America estimates, over 325,000 oil and gas wells were drilled statewide between 1859 and 2000. The DEP has no information on more than half of those wells–about 184,000.  Therefore, the actual number of abandoned and orphaned wells in Pennsylvania could be much higher than the estimates provided above.

Abandoned wells are those that have been out of production for a year or more, and orphaned wells are wells that were abandoned prior to 1985, and from which the current landholder or operator didn’t receive any economic benefits.  When wells are designated as orphaned, the DEP is responsible for plugging them.  As of February, there are 6,251 wells classified as orphaned and 2,272 abandoned wells.

Reasons for Concern

Obviously, the prospects of houses suddenly exploding, as in the picture above, is reason enough to be concerned, and yet there are a variety of ways in which abandoned oil and gas wells can impact Pennsylvania’s environment and the health and well being of our residents. Most unplugged wells release some amount of oil, gas, condensate, or brine, which can kill vegetation, damage fragile riparian ecosystems, and contaminate aquifers. There is also the possibility of injury due to the sudden release of pressure. Some abandoned wells are 30 inch diameter open holes that are obviously a danger for children to fall into.

May 30, 2011 sinkhole in Allentown, PA
There is also the possibility that the presence of wells, whether active or or not, will aggravate unstable geologic formations, which are fairly common in Pennsylvania, due to mining activities in the west and soluble limestone formations in the east. This recent Allentown sinkhole was reportedly caused by a water leak, and caused significant property damage.

To give an example of the potential impact of abandoned oil and gas wells, here are some of the comments from the Abandoned and Orphaned Wells Program, with corresponding point scores:


Comments on abandoned wells and their corresponding point scores.

It is not always clear why a well was given a particular priority rating.  Indeed, there are many instances where ratings are zero, but the comments give reason for concern, such as “Oil in water supply” and “Well intact, near implement dealer facility, is a fire hazard.” Additionally, less than 15 percent of the abandoned wells listed give any comment at all.

Incidents in McKean County


Recent explosion incidents in McKean County, PA. Please click on the gray compass rose and double chevron to hide those menus.

The Bradford Township fire mentioned above (the more southern of the two), is about half a mile from the nearest abandoned well on the list.  However, the suspected well, Rogers 9, was apparently only 300 feet away. Presumably, this well was not known about until the incident occurred.  Rogers 9 was drilled in 1881.

The other incident, in Foster Township, is at the northern edge of a tight cluster of recent drilling activity.  It is entirely possible that there are abandoned wells in that region too, but again, nothing is on our list in the immediate vicinity.

This information leads one to suspect that one of the fires was probably due to recent activity, while the other was caused by a long-forgotten well. Whether or not that was the case, it is clear that drilling holes in the earth near where people live can have an adverse effect for a very long time.

Well Plugging

While well plugging technology has obviously improved over the years, that doesn’t necessarily mean that it is always done right. A single $25,000 bond currently is the only insurance that an operator will plug all of their wells statewide, once they are no longer in production. In most cases, that is probably adequate, since there are non-monetary incentives for the operator to stay in good graces with the DEP. However, there are numerous smaller operators with wells still in production, including some residents who have their own private wells.

In these cases, the carrot of getting the bond money returned may not match the cost of plugging the well properly, especially if multiple wells are involved. In this 1998 document, the DEP put the average cost of plugging a well between $6,000 and $22,000. Last year, the DEP plugged 11 wells in Erie County for a cost of $137,348, or a cost of about $12,500 each.

According to the Bradford Era, over 2,700 wells have already been plugged statewide under the program. In McKean County, more than 950 wells have been plugged since 1989, at a cost of over $6.5 million.

As mentioned above, the DEP assumes responsibility for plugging the orphaned wells. The money for this comes from $150 fees added to oil permit applications, and $250 fees for gas permits. Money is clearly a limiting factor in how many wells the DEP can to plug. Those 11 Erie County wells required funds from 550 new gas permits. If those wells represent the average current price for plugging a well, then the 6,251 orphaned wells still on the list would cost over $78 million to plug, requiring the permit fees from 312,550 new wells. And that is still not including the approximately 184,000 abandoned wells that the DEP doesn’t even know about.

Maybe it is time for a new strategy.

Matt Kelso, BA

Marcellus Shale Violations per Inspection and Enforcements per Violation

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Please Note

This post is provided for archival purposes only

Marcellus Shale violations issued by the Pennsylvania DEP from January through April, 2011.

Violation information from April was recently posted on the Department of Environmental Protection (DEP) website, and two new violations datasets have been posted on our DataTool as well, including:

As the titles indicate, these datasets contain inspection and enforcement data in addition to violations, which allow us to take a closer look at both violations per inspection and enforcements actions per violation.

Violations per Inspection

Marcellus Shale violations per inspection, 2010. For a dynamic, zoomable view, please click the map.

[map archived]
Marcellus Shale violations per inspection, January through April 2011

In 2010, Marcellus Shale wells in the northeastern portion of the state had a noticeably higher number of violations per inspection than the southwest.  This trend is less pronounced so far in 2011.  I should point out that since each inspection on this report lead to at least one violation, it is more accurate to think of this category as “violations per inspection yielding violations”, a cumbersome but significant distinction.

Enforcements per Violation

Marcellus Shale enforcement actions per violation, 2010

[map archived]

Marcellus Shale enforcement actions per violation, January through April, 2011

While the northeastern portion of Pennsylvania has a higher number of violations issued per inspection, the southwest has a higher number of enforcement actions, a category which includes fines and other restrictions imposed on drilling operators by the DEP.  This trend seems to continue into 2011, with relatively minor changes in distribution.

FracTracker Alliance

Data Transparency Bill Will Aid Emergency Response

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Fire in Hopewell Township PA,
Southwestern PA on 3-31-10

Earlier this week, a Pennsylvania Senate committee approved a bill that would require natural gas drilling companies to provide emergency response information to local authorities. Here are the key requirements of drilling companies that are being proposed:

  • Post emergency response information at each well site
  • Register distinct geographic coordinates for each drilling site with the PA Department of Environmental Protection and local authorities
  • File response plans with the local authorities, local 911 center, PA DEP, and PA Emergency Management Agency

Inadequate data transparency of this type has been a significant public health concern ever since natural gas drilling first began in the Marcellus Shale region in PA.Marcellus Shale sites are often drilled in rural, remote areas without exact location information or clear emergency plans. If passed into law, this legislation stands to decrease the response time in the event of an emergency at a well site, reducing the impact that drilling incidents may have on public health and the environment.

To demonstrate why improving the quality and expediency of emergency response to shale gas drilling incidents is an important endeavor, below is a map created on FracTracker’s DataTool showing only the location of violations issued by the PA DEP in 2010 to companies that were drilling into the Marcellus Shale layer. If you press “Click to see more details on this map,” you can use the DataTool to filter the dataset even further in order to see which of these violations was an environmental health and safety violation, not just administrative in nature:

(Darker diamonds indicate there was more than one violation issued in that area. Zoom in to learn more.)

Matt Kelso, BA

Year to Date Drilling Activity in Pennsylvania

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Year to date drilled wells in Pennsylvania. Click the map for a larger, dynamic view.

I have updated the 2011 drilled wells information on FracTracker’s DataTool. There are several interesting trends to point out, including:

  • Percentage of wells from the Marcellus Shale formation
  • Drilling operator trends
  • Non Marcellus horizontal well data

Marcellus Shale and Other Formations

So far in 2011, 587 Marcellus Shale wells have been drilled in Pennsylvania, compared to only 281 from other formations. This means that for the first time, Marcellus wells account for over two thirds of the drilling activity statewide.


In less than three and a half years, the Marcellus Shale went from representing 5% of all oil and gas wells drilled in Pennsylvania to 68%.


Drilling trends over time in Pennsylvania.

While part of the reason for the Marcellus Shale’s increased prominence in the oil and gas industry in Pennsylvania is that activity in the formation is rapidly increasing, it is also true that activities in other formations are decreasing rather dramatically.

We can also take a look at drilling activity by county for both Marcellus Shale and other oil and gas wells.


Marcellus Shale and other wells drilled to date in 2011 by county.

Much of the above chart has to do with where the hydrocarbon resources are. It is interesting to note though, that the county with the most Marcellus wells (Bradford) has no wells in other formations, and that the county with the most non Marcellus wells (Forest) has no Marcellus wells at all.

Drilling Operators and the Marcellus Shale

Of the 91 operators that have drilled oil and gas wells so far this year in Pennsylvania, 60 had no Marcellus Shale wells, 25 had only Marcellus Shale wells, and seven had wells in both categories.


Most operators drill in either the Marcellus Shale or other formations, but not both.

There is surprisingly little overlap in this chart. But what about the operators with wells in both categories?


Marcellus and non Marcellus wells for operators with both categories in 2011.

Even still, most of the operators specialize in one kind or the other. Taken together, these two charts show that operators which drill in the Marcellus Shale are specialists, with very few wells drilled in other formations.

Non Marcellus Horizontal Wells

It is well known that the combination of hydraulic fracturing and horizontal drilling techniques allowed for the profitable extraction of natural gas from the Marcellus Shale. For that reason, it isn’t surprising that most of the Marcellus wells are drilled horizontally. What is interesting is that the technique is now being used in other formations as well.


Five Non Marcellus Shale wells have been horizontally drilled so far in 2011.


Non Marcellus horizontal wells so far in 2011.

There isn’t much of a trend in which companies drilled these five wells, with two of the companies active in the Marcellus Shale and two of them not. Spatially, all four of the counties are in the western portion of the state, with Clarion County somewhat to the north of the other three.

Matt Kelso, BA

2010 Fines for Marcellus Shale Violations

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In yesterday’s Post-Gazette, Don Hopey discussed an analysis by PennFuture which saw a notable decline in fines in the first quarter of 2011, as compared to the same period last year. The implication is that the DEP is not backing up violations with fines under Governor Corbett’s administration to the same degree that it did under former Governor Rendell. In the former administration, PennFuture calculated an enforcement action was handed out for every 1.7 violations, and now the rate is one per every 8.7 violations.

I think this is a worthwhile trend to keep an eye on, with the caveat that it is still early in Governor Corbett’s tenure, and that violation data varies widely from month to month.

It is also possible that the DEP under the Corbett administration will still issue fines for significant events. In fairness, I came across this article of fines issued over eight months after an incident by the DEP under Rendell. I think we need more time to see if the new administration’s patterns of reduced fines per violation hold.

That said, Marcellus Shale fines and enforcements under the Rendell administration is hardly a sensible target for comparison. The fines issued in 2010 were at once paltry and erratic.

Industry sources indicate that Marcellus Shale wells cost between $5 million to $6.4 million to drill. Last year in Pennsylvania, there were 1,454 Marcellus Wells drilled in the Commonwealth, meaning that the total cost of operations for the year for the industry is somewhere in the mind-boggling range of $7.2 billion to $9.3 billion. How much of that cost was fines issued by the DEP? $775,650.22. Even using the conservative figure of $5 million per well, DEP fines only account for 0.01 percent of operating costs–hardly any impediment at all. In essence, with the change in administration the DEP went from collecting fines in Monopoly money to asking drilling operators to sit down for a while and think about what they’ve done.

Over 45 percent of the fines issued for the Marcellus Shale in 2010 went to EOG Resources, the operator for a major blowout in Clearfield County. That was far from the only major incident in 2010, but the DEP was clearly mad about the incident, posting an entire section about the incident on their website. The $353,400 fined to EOG for this incident went to cover the DEP’s cost of response and investigation.

The two operators with the highest fines issued for Marcellus Shale operation in 2010 are toward the top of companies with the largest number of violations per year. That said, those companies at the very top were fined a significantly lower amount.

When we look at fines per violation, in addition to the same two operators that stood out in the last graph, we see several companies with relatively few violations having a significant number of fines per violation.

From an outside perspective, it is difficult to determine what sorts of factors go into whether or not a fine is issued, and if so, for how much. If the goal is simply to recoup costs of the DEP response and investigation, one wonders why there isn’t a fine more often, since every violation issued costs the DEP some resources to evaluate, process, and issue. And if fines are to act as a deterrent, they should include punitive damages, not just actual costs.

Keep in mind that the $7.2 billion to $9.3 billion range is just for Marcellus Shale wells, which last year represented about half of all oil and gas wells drilled in Pennsylvania. The industry is huge. One way we could have the oil and gas industry benefit all Pennsylvanians is by paying for the expenses of their DEP oversight, through permit fees and fines. That taxpayer savings could then be applied to other programs to help address the overall budget issue. Such an arrangement would be a huge boon to Pennsylvania, and while they might complain, the industry would barely notice if their cost per well went up by a few thousand dollars. Such an arrangement would also allow for the DEP to keep up with a rapidly expanding industry in a time of fiscal austerity that is sweeping the Commonwealth, and the nation as a whole.

  1. Other sources, such as the Marcellus Drilling News report higher fine totals, but that includes a broader time frame. See Sean Hamill’s Post-Gazette article.
FracTracker Alliance

FracTracker Webinar Reminder

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Today we will be hosting Webinar #7 in the FracTracker training series. This afternoon’s webinar will cover the various programs working in collaboration with the the FracTracker system, a quick piece about the Data Index, and changes to the blog that are coming soon.  If you can’t make the webinar, the recording will be available online after the event here.

Webinar Details

Date: Monday, May 16, 2011
Time: 12:00 pm, Eastern Daylight Time (New York, GMT-04:00)
Meeting Number: 646 482 139
Meeting Password: FTwebinar7

To View & Listen to the Webinar Using Your Computer

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  4. Click “Join Now”.
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To Listen to the Audio Portion Only

(Use this option only if the first one does not work on your computer.)

  1. To receive a call back, provide your phone number when you join the meeting, or call the number below and enter the access code.
  2. Call-in toll-free number (US/Canada): 1-866-469-3239
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Webinar Tips

If you have not participated in any of our previous webinars, please click here to make sure you can view UCF (Universal Communications Format) rich media files prior to the launch of the session today.

For questions concerning this meeting, please contact Samantha Malone in advance of the scheduled meeting time at: slm75@pitt.edu.

IMPORTANT NOTICE: The WebEx service includes a feature that allows audio and any documents and other materials exchanged or viewed during the session to be recorded. By joining this session, you automatically consent to such recordings. If you do not consent to the recording, do not join the session.

FracTracker Alliance

New Report: In the Shadow of the Marcellus Boom

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Just last week, PennEnvironment released a new study, In the Shadow of the Marcellus Boom, at press conferences in Scranton and Pittsburgh, plus a national teleconference. The report looks at the proximity of schools, hospitals and day care facilities to permitted Marcellus Shale gas wells. Their aim was to demonstrate the risks of shale gas extraction to vulnerable populations. Press release.

Below is a map of the day care, school and hospital facilities located within 2 miles of a permitted Marcellus well site:

 

Instructions:

  • Use the legend to toggle the information displayed on the map on or off.
  • Select an area of interest using the zoom bar in the lower-left corner plus the hand tool to pan, or use the zoom selection tool.
  • To obtain information about any point on the map, select the “i” tool in the gray toolbar and click on a point of interest. Click again within the dialog box to drill down and see more details for each point.
  • You can toggle between terrain, satellite, and street view with the buttons on the lower right of the map.