During the first quarter, conventional oil and gas drillers were issued 77 NOVs and unconventional shale gas drillers 8 NOVs for the same violation. Read more here.
This continues the pattern of well abandonment that is pervasive in the conventional oil and gas drilling industry. Read more here.
DEP records show the agency has less than $15 per well available to plug the over 100,500 active conventional oil and gas wells that now have permits because of woefully inadequate well plugging bonding requirements. Read more here.
The average cost to taxpayers to pay to plug a well is $33,000. Read more here.
It would cost taxpayers over $3.3 billion to plug these inadequately bonded wells, if operators walked away, and they try to do that almost every day.
In addition, any conventional oil and gas well drilled before April 1985 is exempt entirely from the need to post any bond.
It would cost taxpayers over $1.8 billion to plug these wells.
This means state taxpayers are on the hook to pay for over $5.1 billion in well plugging and cleanup costs.
DEP Federal ‘Orphan’ Well List Includes Unconventional, Conventional Wells
Twenty-seven percent of the wells on the list of “orphan and abandoned” oil and gas wells DEP hopes to plug at taxpayer expense under the new federal well plugging program are active conventional wells that DEP lists as having identified owners, according to Ankit Jain, Associate Attorney for the Sierra Club. Read more here.
Jain also noted there are at least 57 unconventional shale gas wells on DEP’s list. Read more here.
Jain said the Sierra Club is concerned these 7,300 active wells would be plugged at taxpayer expense [about $241 million] when it is the owners that benefited from the wells who should be footing the bill.
The list again shows the issue of having state and federal taxpayers pay to plug and clean up both conventional and unconventional wells abandoned by their owners is very real in Pennsylvania.
That’s why having adequate bonding to cover this potential $5.1 billion in taxpayer liability from oil and gas wells is so important.
Bill Would Block Well Plugging Bond Reform
But, on June 30, Republicans on the Senate Environmental Resources and Energy Committee voted to report out House Bill 2644 (Causer-R-Cameron) blocking any increase in conventional oil and gas well plugging bonds, exempting pre-1985 wells (which is most of them) from any bonding leaving taxpayers liable for $5.1 billion in cleanup costs. Read more here.
The vote was seven to four with all Republicans supporting, all Democrats opposed.
Sen. Scott Hutchinson (R-Venango) said at the meeting the bill is designed to lock in place inadequate well bonding amounts that only the General Assembly can change in law, which they have never done.
The bill is in response to a rulemaking petition the Environmental Quality Board accepted in November to increase the bonding amounts for both conventional and unconventional oil and gas wells to the cost taxpayers would have to pay to plug them if abandoned by drilling companies. Read more here.
The EQB is empowered by law to make these changes.
DEP may report back to the EQB on the petition at its next scheduled meeting on July 12 and has not yet taken a position on the issue.
Increasing bond amounts to the real taxpayer cost of plugging and closing the loophole in state law that exempts wells drilled before April 1985 from any bonding requirement will go a long way to protecting taxpayers from billions of dollars in liability for plugging these wells if drilling companies walk-- and they are walking way-- particularly the conventional drillers. Read more here.
The other issue is staffing for DEP’s Oil and Gas Program.
The Oil and Gas Program faces a $10.5 million annual funding deficit, nearly half of the approximately $25 million it costs to regulate conventional and unconventional drilling. This deficit has also cut staff from a full complement of 226 positions to 190. Read more here.
The bottomline is DEP can only catch companies trying to abandon new wells if they have the staff to do it.
Conventional Drillers - 2nd Qtr
The conventional companies issued NOVs for abandoning wells without plugging them in the second quarter were-- Apex Energy, Bear Lake Properties*, Betz Oil*, BV Gas, Champion Bolt Corp., Energy Exploration & Dev. Ltd, Energy Investors, FM Sloan, Inc., Fortress Energy Corp, Glenn D. Gavin & John R. Gavin III, Hyde Park Foundry, Martin B. Simmons*, Marvin Sanders Oil*, Medina Res. Dev., Michael Harjn, Mid East Oil, Millcreek Twp. School District*, Nucomer Energy, Ows Acquisition*, PA Mineral Services*, People’s Natural Gas, Pierce & Petersen, PPP Future Dev., Repsol Oil & Gas USA, River Ridge Gravel, Snow & Snow Oil, Tatonka Oil Co. and VEC Energy. [*repeat NOVs from first quarter]
The well locations were in Erie, Fayette, McKean, Mercer, Venango, Warren, Washington and Westmoreland counties.
Conventional companies with the most violations were-- River Ridge Gravel and People’s Natural Gas (for wells near a natural gas storage facility in Washington County).
The most frequent kinds of NOVs issued by DEP to these companies, aside from attempted well abandonment, included things like defective casing and cementing allowing methane and fluid leaks, improper waste disposal and failure to monitor the integrity of wells.
It’s worth a few minutes to browse through DEP’s second quarter compliance report just to see the hundreds of violations racked up by the oil and gas industry in Pennsylvania.
Warning: The average person is likely to be shocked at the number and extent of the violations documented by DEP day in and day out.
Click Here for the complete list of second quarter NOVs issued by DEP’s Oil and Gas Program in 2022 (remembering there are duplicates).
Click Here for the complete list of NOVs issued by DEP during the first quarter.
Prior 6 Years - Conventional
From 2016 to 2021, DEP issued 4,270 notices of violation to conventional drillers for attempting to abandon their wells. Read more here.
Unconventional Shale Gas - 2nd Qtr
In the second quarter, DEP issued 21 NOVs to six unconventional shale gas drillers for abandoning unconventional shale gas wells without plugging them on pads in Butler, Clinton, Lycoming, Mercer and Westmoreland counties.
Big Dog Energy [a crypto currency mining operation] received the largest number of NOVs-- nine-- more than the entire number of NOVs issued to unconventional shale gas well owners in the first quarter.
DEP issued eight NOVs to five unconventional shale gas drillers for the same violation in the first quarter of 2022. Read more here.
The companies in the second quarter included Big Dog Energy (9), Diversified Energy (3), Frontier Natural Resources (4)*, Mountain V Oil & Gas (1), Pin Oak Energy Partners (1)*, and Range Resources Appalachia (3)*. [*Repeats from first quarter.]
The unconventional shale gas company with the most NOVs overall in the second quarter was Chesapeake Energy Appalachia.
The list of most frequent kinds of NOVs issued by DEP to these companies, aside from attempted well abandonment, included things like defective casing and cementing allowing methane and fluid leaks, improper waste disposal and failure to monitor the integrity of wells.
Again, it’s worth a few minutes to browse through DEP’s compliance report just to see the hundreds of violations racked up by the oil and gas industry.
Click Here for the complete list of second quarter NOVs issued by DEP’s Oil and Gas Program in 2022 (remembering there are duplicates).
Click Here for the complete list of NOVs issued by DEP during the first quarter.
Prior Six Years - Unconventional
DEP issued 12 unconventional shale gas drillers notices of violation for abandoning gas wells without plugging them at 35 wells pads (each with multiple wells) in 17 counties between 2016 and 2022 (through February). Read more here.
[Note: If you believe your company is listed incorrectly, contact DEP’s Oil and Gas Management Program.]
(Photo: Abandoned conventional oil and gas wells.)
Related Articles:
-- Republicans On Senate Committee Report Out Bill Exempting Conventional Oil & Gas Wells From Plugging Bonds Sticking Taxpayers With $5.1 Billion In Cleanup Liability [6.30.22]
-- New Abandoned Wells: DEP Records Show Abandoning Oil & Gas Wells Without Plugging Them Is Pervasive In Conventional Drilling Industry; Who Is Protecting Taxpayers? [2.23.22]
-- 12 Unconventional Shale Gas Drillers Issued DEP Notices Of Violation For Abandoning Wells Without Plugging Them At 35 Well Pads In 17 Counties [3.2.22]
-- DEP Federal ‘Orphan’ Well Plugging List Includes 7,300 Active Conventional Wells With Identified Owners; DEP Says Cost Recovery A Priority [5.23.22]
-- New Penn State Study Finds Runoff From Conventional Oil & Gas Wastewater Dumped On Unpaved Roads Contains Pollutants That Exceed Human-Health, Environmental Standards [5.27.22]
-- On-Site Conventional Oil & Gas Drilling Waste Disposal Plans Making Hundreds Of Drilling Sites Waste Dumps [6.6.22]
-- Conventional Oil & Gas Drillers Dispose Of Drill Cuttings By ‘Dusting’ - Blowing Them On The Ground, And In The Air Around Drill Sites [5.2.22]
-- DEP Advises 18 Municipalities Where Road Dumping Of Conventional Oil & Gas Drilling Wastewater Is Occurring The Practice Is Illegal And Considered Waste Disposal [5.31.22]
-- Senate Budget Hearings: PA’s Experience With New Pipeline Construction Shows State Laws Not Strong Enough To Prevent Environmental Damage, Protect Public Safety [2.2.22]
PA Environment Digest:
-- Links To Oil & Gas Drilling Articles
[Posted: July 5, 2022] PA Environment Digest
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