Sunday, November 1, 2015

Conventional Oil Producers Respond: It’s Time To Recognize There Is Life West Of Susquehanna River

Mark Cline, President of the PA Independent Petroleum Producers, Saturday responded to a story in the September 28 PA Environment Digest about the introduction of Senate Bill 1011 by Sen. Scott Hutchinson (R-Venango) which would force DEP to start over in updating the Chapter 78 drilling regulations and kill the current proposal.
Mr. Cline’s letter also includes a response to earlier article in the Digest in April entitled, “Analysis: Myth-- Conventional Oil and Gas Drilling Is Benign.”
PA Environment Digest invited Mr. Cline and PIPP to offer their perspective on the current controversy over DEP's Chapter 78 drilling regulations.
Here is his response in full--
My name is Mark Cline. I am the President of the Pennsylvania Independent Petroleum Producers and a member of the Conventional Oil and Gas Advisory Committee. I am writing in response to your Daily Environmental Blog from September 26, 2015.
The title of your entry “Senator Hutchinson Introduces Bill To Kill Conventional Drilling Regulations” is both inflammatory and false.  The purpose of Senator Hutchinson’s bill, SB1011, is to force our Pennsylvania Department of Environmental Protection to honor the legislative intent of Act 126 of 2014.  
This Act, passed by state legislators and signed by Governor Corbett, mandated the Department bifurcate the conventional and unconventional regulatory instruments of the Oil and Gas Act. DEP instead employed a word processing exercise and delivered two virtually identical documents in Chapter 78 for conventional operations and Chapter 78a for unconventional.  
It is not the intent of Senator Hutchinson or the conventional industry to “kill” regulations with regard to conventional operations.  
Conventional Operators have been effectively regulated for over thirty years in this Commonwealth. We simply want our regulations to make sense; furthermore, we demand our DEP to demonstrate need through empirical data for new regulations and to perform even a basic cost analysis as they are required to do via the regulatory review act.
To this date no data has been provided and only three of the initial 2013 regulation changes were accompanied with any kind of cost analysis.  Since its’ first publication in the Pennsylvania Bulletin in 2013 more than 20 new regulation changes have been piled on to the revised Chapter 78 regulations; all without data supporting the need for change nor cost analysis, as is required by law.
It is your claim that the Department, by releasing “hundreds of photographs in its most recent Oil and Gas Annual Report,” demonstrates the need for new, stricter regulations.  What is not stated by you or the Department are the following:
1) Operator, site, date and location information for most of the photos is not referenced.
2) The photos where the above information is listed are representative of only 6 conventional operators. According to the Department, as of 2013, there were an estimated 7,280 conventional operators working in Pennsylvania.
3) These photographs cover a span of eight years, with some dating back as far as 2007.
4) There are no photographs that depict the sites in question after they were remediated under existing regulations.
5) There are no photographs that depict a gap in the current regulations. All of the photos reflect conduct that is already in violation of existing regulations.
You then go on to say conventional operators have incurred three times as many violations as the unconventional. There have been 9,884 unconventional wells drilled in the Commonwealth as of my sitting down to write this response.
In that same time span there have been 29,269 conventional wells drilled. There are also over 100,000 additional conventional wells currently in safe operation. Considering this skewed ratio it is no surprise that the conventional operators incur more violations.
The bifurcation of Chapter 78 of the Oil and Gas Act was not contrary to the regulatory process, as you claim. Nor was it “slipped into the fiscal code.”  HB 2350 was unanimously passed by the House Environmental Resources and Energy Committee and SB 1378 was passed in a 7 to 4 majority by the Senate’s committee of the same name.  
It was then read aloud and signed into law by the Governor with the Fiscal Bill.  I would hardly consider that subterfuge.
Western Pennsylvania was the crucible of the Industrial Revolution. Conventional oil and gas as an industry has thrived on the backs of small, mostly family-owned businesses since its inception in 1859.  
These businesses were the backbone of an industry that almost single-handedly fueled the United States Military during the First and Second World Wars.  
So, if you perceive a romanticized pride in the notion that many of these businesses currently operate leases that have been passed down by their families for generations, then consider us romantics…but the reality is we are just hard working men and women trying to make a decent living by producing a commodity that enhances the lives of every single person in this country.  
We are not blind to the fact that there are over 325,000 abandoned oil and gas wells in our Commonwealth.  We might not be proud of this fact, but we own up to it.
Unlike many other industries in this state that have left behind millions of tons of industrial waste and thousands of acres of brownfield sites, the conventional oil and gas industry continuously works with our DEP and EPA to find ways to plug wells that can no longer claim a responsible owner.   
What you claim to be facts not myths.
1) Conventional wells cause water loss and contamination just like unconventional wells.
During the Conventional Oil and Gas Advisory meeting on March 26th in Harrisburg, Kurt Klapkowski made this statement; “Conventional industry’s impact is relatively temporary in nature. You don’t see long term impacts necessarily”. On the rare occasion that water supplies are affected by conventional activities it clears up in a short period of time. Also, polluting the waters of the Commonwealth is already a violation of the Oil and Gas Act.
2) Conventional wells have more violations than unconventional wells.  The DEP 2014 Oil and Gas Annual Report states: “In 2014, 1,449 violations were identified at conventional sites, and 412 violations were observed at unconventional well sites.” What it failed to point out from its own online reports was that:
a) Conventional well sites outnumbered unconventional well sites by more than 12:1 in 2014. (121,988 active conventional wells, 9,848 active unconventional wells).  This reveals that there was 1 violation for every 84 conventional wells, as opposed to 1 violation for every 24 unconventional wells.  
b) Of the 12,703 inspections of conventional operations conducted in 2014, 11,905 inspections did not reveal any violations. That is a 93.7% compliance rate. That is an amazing statistic given that the Department has turned up the heat on our industry in recent years with more inspectors conducting 24% more inspections than in 2008.
c) 40% of the violations identified in conventional operations (583) in 2014 were merely administrative violations, not environmental health and safety violations.
d) 12 operators were responsible for over 45% of all the violations identified.
3) Both unconventional and conventional industries employ frac’ing..  While this is true the techniques are completely different. The conventional industry drills vertical wells usually no more than 2,500 feet deep. Our fractures propagate no more than 150 feet horizontally from the well bore. A typical conventional frac stage uses a few thousand gallons of water and about 80 sacks of sand. Unconventional wells are much deeper and “kickoff” horizontally up to 9,000 feet in different directions. Along this 9,000 foot section dozens of stages are frac’d with millions of gallons of water and chemicals.
4) Conventional wells are drilled through the same sensitive aquifers.  This is true. There are very clear regulations that have been in place since the implementation of Act 223, The Oil and Gas Act of 1984 that protect these aquifers through the use of cemented-in casing strings.
5) Conventional wells create a bigger footprint on the land.  Even if you take all the 121,988 conventional well locations we are still 3.5 times smaller than the footprint of the unconventional.
a) Forty-three conventional locations can be on one unconventional location--
b) Conventional location roads are very small, usually 12 feet wide.
c) The unconventional industry builds two lane roads as they need larger roads to accommodate the heavy truck traffic. They do a better job of building roads than most townships and the Forest Service.
d) Conventional pipeline right-of-ways bear little to no impact as they are most often buried in the ditches of our location and access roads.
e) The unconventional need wide, expansive right-of-ways that impact many surface property owners for many miles.
I would like to say here that the conventional industry supports the unconventional industry and together we hope to work towards making the U.S. energy independent.
Of the conventional operators in the Commonwealth today, virtually all are small businesses. In a corner of the Commonwealth that Industry has largely abandoned, small business is what makes our economy work.
Thousands of Pennsylvanians rely on the conventional oil and gas industry of Pennsylvania to provide a living for their families.  The Chapter 78 regulations, if implemented and enforced as written, would be the end of this industry.
It is time that Harrisburg realizes that there is life West of the Susquehanna River. Environmentalists make the production of fossil fuels an issue of morality.  Are their very lives not enriched by the products produced by this industry?
The last time I checked, my DEP Oil and Gas Inspector was driving a Ford pickup powered by gasoline. Why is it not an issue of morality to potentially put thousands of people out of work and decimate communities that once helped make this State the crucible that forged a way of life worldwide?
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