On March 8, 2013, the Federal Energy Regulatory Commission (FERC) issued an order authorizing Dominion Transmission, Inc.’s requests to build two new pipeline projects in New York and Pennsylvania. The two projects are the Tioga Area Expansion Project, which will include 15 miles of new 24-inch diameter pipeline in Tioga, Greene, Potter, and Clinton Counties, Pennsylvania, as well as Steuben County, New York, and the Sabinsville to Morrisville Project, which will include 3.56-miles of new 24-inch diameter pipeline and additional facilities in Tioga County, Pennsylvania. FERC’s authorization is conditioned upon Dominion placing the projects into service within two years.
A recent study by the Proceedings of the National Academies of Sciences concluded that Pennsylvania’s waterways show little evidence of damage from chemical spills from oil and gas operations. The Associated Press reports that the study covered almost 5,000 gas drilling sites around the state. The study noted a 5 percent increase in suspended solids downstream of drilling operations, but the study did not determine the source of the increased suspected solids, which are often associated with runoff from development. The study also noted a 10 percent increase in chloride levels downstream from plants accepting wastewater.
The Secretary of the Pennsylvania Public Utility Commission (PUC) published a letter in the March 9, 2013 issue of the Pennsylvania Bulletin containing information on the annual registration requirements for pipeline operators under the Gas and Hazardous Liquids Pipelines Act. The Act, more commonly known as Act 127, provides PUC with the authority to regulate gas and hazardous liquid pipelines that are not operated by public utilities. As explained in the letter, PUC is requiring Act 127 pipeline operators to submit a registration form by March 31, 2013, as well as a $250 annual registration fee. The form is to include information on the total amount of regulated pipeline mileage as of December 31, 2012, which will then be used to determine the amount of user fees that will be assessed for each operator in an invoice that PUC intends to send to each operator later in the year.
On March 6, 2013, the Allegheny County Health Department unanimously passed a recommendation that would require unconventional shale gas operators to notify the Department 24 hours prior to drilling a well, WTAE-TV reports. As previously reported, the Department has been contemplating the implementation of notification requirements for unconventional shale gas operators for some time. The 24-hour notification requirement is consistent with the many notification requirements for operators to make to the Pennsylvania Department of Environmental Protection in compliance with Act 13 of 2012. The recommendation must still be approved by both the Allegheny County Council and county executive Rich Fitzgerald before becoming effective.
Pennsylvania has been ranked third among all states for the number of new or expanded corporate facilities by Site Selection Magazine. The magazine also ranked Pittsburgh sixth among metropolitan areas with more than one million people. The Tribune-Review reports that it is the second consecutive year that Pennsylvania was among the top states and third for Pittsburgh in the top ten among large metropolitan markets. The editor in chief of the economic development publication indicated that the energy industry, including the oil and gas industry, helped the state’s ranking.
In another sign of the energy industry’s impact on the region, the Pittsburgh Technical Institute broke ground earlier this week on a $3.5 million energy technology center designed to educate individuals in the oil and gas electronics involved in extracting, transporting, and storing gas. The 15,392-square-foot facility, which is being funded partially by the Redevelopment Assistance Capital Program, is expected to be completed this fall. The Post-Gazette has more.
As a result of the booming gas market in Pennsylvania’s Marcellus shale, Columbia Gas Transmission Group submitted plans Monday with the Federal Energy Regulatory Commission (FERC) for a $210 million expansion to its Philadelphia network, the Philadelphia Inquirer reports. Columbia’s plans include installing a 20-inch-diameter pipeline on a 7.5-mile route in Gloucester County and a 26-inch-diameter pipeline for 8.9 miles in Chester County. Columbia expects FERC approval of the East Side Expansion Project by June 2014.
WJAC-TV reports that Aspen Fluid Logistics plans to continue its development of a wastewater treatment pilot system in Johnstown, Pennsylvania, despite weather and permitting challenges. The pilot project, which was announced last April, will treat up to 50,000 gallons per day of wastewater from oil and gas drilling operations. It is estimated that the project will bring more than 100 jobs to Cambria County and surrounding areas. If the pilot program is successful, company officials indicate that they hope to complete construction of a full water treatment facility, which would take at least two years.
On February 25, 2013, the Commonwealth Financing Authority (CFA) began accepting applications for the following five programs established and supported by the Act 13 Marcellus Legacy Fund:
1. Abandoned Mine Drainage and Abatement and Treatment Program
2. Baseline Water Quality Data Program
3. Greenways, Trails, and Recreation Program
4. Orphan or Abandoned Well Plugging Program
5. Watershed Restoration and Protection Program
These programs are jointly administered by the Department of Community and Economic Development, the Department of Conservation and Natural Resources, and the Department of Environmental Protection. The total funding available for these programs is $14 million dollars, which comes directly from impact fee payments made last year by natural gas operators. Applications are currently being accepted through July 31, 2013, and will be considered at CFA’s Nov. 13, 2013, meeting.
Despite a drop in the number of rigs within the Commonwealth, the Pocono Record reports that Pennsylvania gas production doubled in 2012. In 2011, there were 110 drilling rigs in Pennsylvania. That number dropped to 84 in 2012. Despite this, Pennsylvania produced 1.1 trillion cubic feet of gas, or roughly 9% of the country’s daily demand, between July and December 2012. Continuing with past trends, the vast majority of the top producing wells were in Northeastern Pennsylvania, and Bradford was the top producing county.
Allegheny County Council voted yesterday to approve a lease with CONSOL Energy Inc., permitting gas drilling at Pittsburgh International Airport, the Pittsburgh Tribune-Review reports. County Executive Rich Fitzgerald intends to sign the bill. CONSOL estimates that drilling will start no earlier than late 2014. Current estimates are that gas drilling at the airport could earn the Allegheny County Airport Authority $500 million dollars. Federal law requires that the revenue that the county receives from the lease must go directly to the airport. The Shale Energy Law Blog has more coverage on the airport lease here and here.
The Pennsylvania Senate Committee on Environmental Resources and Energy unanimously approved Senate Bill 411 on Tuesday. The Herald-Standard reports that the bill would provide liability protection from the perpetual treatment of mine water at its source when the end use is for hydraulic fracturing or industrial use. The bill would provide offer liability protection through a Pennsylvania Department of Environmental Protection process developed in the Environmental Good Samaritan Act. The issue was among the policy recommendations made by the Governor’s Marcellus Shale Advisory Commission in a 2011 report. The bill was previously approved by the Senate, but failed to get House approval during the last legislative session. The DEP also recently issued a white paper regarding the use of acid mine drainage in drilling operations.
On February 12, 2013, the Pennsylvania Department of Environmental Protection released its 2011 emissions data from the unconventional drilling industry, which accounts for emissions from natural gas production and processing facilities from “57 operators of unconventional wells and 40 mid-stream operators of 150 compressor stations.” In its Fact Sheet, the DEP notes that there were significant reductions for a number of air contaminants from 2008 (the last year that the DEP completed an emissions inventory) to 2011, including nitrogen oxides and sulfur oxides. In a press release, the Marcellus Shale Coalition noted that according to this 2011 air emissions data, “Marcellus Shale development accounts for less than 3 percent of nitrogen oxide (NOx) and 1 percent of the total volatile organic compounds (VOC) emitted each year in the Commonwealth.” Pursuant to the Oil and Gas Act of 2012 (Act 13), owners and operators of these point sources must report these air emissions annually to the DEP by March 1 each year. 2012 air emission data is due to the PADEP on March 1, 2013.
The Allegheny County Airport Authority has approved an oil and gas lease with CNX Gas Co. that could net the Authority as much as $500 million from an up-front payment and estimated royalties, the Pittsburgh Post-Gazette reports. The agreement provides the Authority with an upfront rental payment of $50 million and will cover the 9,263 acres of mineral rights controlled by the Authority. Authority representatives said CNX was tentatively planning to develop six to seven well pads on the property and to drill 45 to 50 wells on those pads. The deal still requires approval from the Allegheny County Council.
West Virginia Public Broadcasting reports that a new study has begun regarding the use of water in hydraulic fracturing in the Marcellus Shale in West Virginia, Pennsylvania, and Ohio. The Robert and Patricia Switzer Foundation is providing funding for the study, which is being undertaken by Downstream Strategies and the non-profit organization Earthworks, as well as Switzer Foundation scholars. The goal of the study is to develop a life cycle analysis of water involved in drilling and hydraulic fracturing. In addition to the amount of water used, the study will identify the source and the final destination of the water in order to compare water use for hydraulic fracturing to the water used for other types of energy production. The findings of the study are expected to be available by the end of 2013.