Friday, July 31, 2020

DEP Unconventional Drilling Well Permit Fee Increase Effective August 1

The Environmental Quality Board published the final regulation increasing the DEP permit fee for unconventional drilling permits in the August 1 PA Bulletin.  It becomes effective August 1.
The fee will increase from $5,000 for nonvertical unconventional wells and $4,200 for vertical unconventional wells, to $12,500 for all unconventional well permit applications to administer the 2012 Oil and Gas Act.
This is the first fee increase since 2014.
DEP first started to develop this regulation in February 2018 with the Oil and Gas Technical Advisory Board-- over two and a half years ago.
The revenue projections done for the regulation were based on DEP receiving 2,000 permits a year.  Between January 1 and June 19, DEP received 535 unconventional well permits, a little more than half the number needed to adequately support the program.
In January, DEP did collect a penalty assessment of $30.6 million from ETC Northeast Pipeline for the 2018 explosion of the Revolution Pipeline in Beaver County that was deposited into the Fund supporting the Oil and Gas Management Program.  Read more here.
However, DEP has never used penalties as a way of raising money to support its regulatory programs and it would be bad public policy to do so.
Neither the Senate nor the House Environmental Resources and Energy Committees expressed their opposition to the final regulation to the Independent Regulatory Review Commission.
Related Article:
[Posted: July 31, 2020]  PA Environment Digest

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