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Pennsylvania DEP Plans to Implement New Shale Regulations Next Month

Five years after it began drafting an overhaul of environmental regulations for shale gas drillers, the Pennsylvania Department of Environmental Protection (DEP) expects to publish the new rules in the state bulletin Oct. 8 when they are to finally go into effect, according to a top agency official.

Deputy Secretary of the DEP's Office of Oil and Gas Management Scott Perry was on hand Wednesday at the Marcellus Shale Coalition's (MSC) Shale Insight conference in Pittsburgh to give industry representatives an update on the regulatory package and answer questions about how the agency plans to implement it. There was clearly confusion about how the process will unfold among those who attended Perry's panel.

"What I'm really here to do is to demonstrate the department's commitment to successful implementation of these rules," Perry said, "to demonstrate that the industry has a willing partner in DEP for cooperative, collaborative efforts to successfully implement some new rules."

Many of the regulations that will be adopted, a package hundreds of pages thick, Perry said, are based on existing department policies that will be codified in state law. Even if they didn't become final, he added, the industry itself is already practicing and in compliance with many of the rules.

"It's a smaller section of truly new things, and even within the truly new areas, I think there are a number of practices that are industry practices already," he said.

The DEP began drafting the rules in 2011. It's taken an unusual amount of controversy to get to this point. Earlier this year, the agency sent the package our for review (see Shale DailyJan. 6). The Environmental Quality Board and the Independent Regulatory Review Commission have approved it and the state Attorney General's (AG) office has as well (see Shale DailyAug. 15).

The rules were written in tandem with those for the conventional oil and gas industry. In June, the General Assembly approved legislation to scrap the conventional rules and require the DEP to start those over (see Shale DailyJune 15). Lawmakers on both sides of the aisle accused the agency of ignoring Act 126 of 2014, which required it to adopt separate regulations for both industries.

Attendees of Wednesday's panel weren't quite clear on when the rules would be published and go into effect, saying they had expected them sometime earlier this month or next. After the AG completed its review in August, the package was sent to the Legislative Reference Bureau, which is responsible for compiling and drafting the regulations for the state bulletin. Perry said DEP recently received the draft from the bureau and expects to publish the regulations on Oct. 8.

The new rules are designed to reduce impacts on public resources, such as schools and parks, help prevent spills, strengthen waste management and require stronger well site restoration. Perry said major changes included in the packet are the elimination of temporary waste storage pits; the re-permitting of centralized impoundments, and a stipulation that requires fresh water impoundments to be registered and restored. Operators will also be expected to conduct reviews of abandoned and active wells near their pads prior to drilling. Monthly waste reporting, instead of two times per year, will also take effect in January 2017 with the first report due to the state in March 2017.

"One of the comments I got after we put the rules out is that 'we didn't get anything,' the industry didn't get anything," Perry said. "'We had all these comments and DEP didn't listen.' I don't think that's true. Some of the things you didn't get were what the public wanted the most. The number one comment: moratorium, ban it. Number two, give a half mile setback from schools and these other structures. We're an agency based on science and facts, there's no basis in science or facts for either one of these things, in my opinion."

Perry said it was clear that some criticizing the rules or those confused by them have not read them and suggested that stakeholders could find many of their answers on the comment response section of the DEP's website. Perry said if a well has already been permitted and stimulation has started at the time the rules go into effect, then operators would not have to amend their well permits.

If a well is re-fracked, however, operators would be subject to additional requirements. If permits are renewed, he added, then the new rules would also apply.

Drilling near public resources such as schools, playgrounds and drinking water protection areas will now require additional considerations. Under the new regulations, operators have to conduct a review of impacts to public resources and develop mitigation measures for the DEP and other state agencies to review.

"I know that with the public resource and protection piece, there's some consternation about that, even the legality of it," Perry said. "This is a section quite frankly, that as an environmental regulator, I feel is very important...While we might have a disagreement with industry over its validity, I feel it's an important piece."

The Pennsylvania Independent Oil and Gas Association recently lost a lawsuit in which it alleged the DEP is overstepping its authority by enforcing those public resource protection requirements (see Shale DailySept. 2). Perry said DEP officials plan to attend the MSC's annual meeting next month to participate in breakout sessions where agency officials can again answer questions about how the new rules are being implemented.

Attendees also said they were concerned about how uniformly the regulations would be enforced at the DEP's six regional offices across the state. Perry said the agency has spent considerable time trying to get personnel on the same page about the new rules before their implementation.

The regulations had previously established a new requirement for noise control and mitigation. It would have required operators to prepare and implement a site-specific noise mitigation plan for drilling, stimulation and other development activities. Operators would have been required to evaluate the effectiveness of those measures, but the standard was dropped from the final rulemaking.

Perry did tell attendees that they should eventually expect a directive on noise abatement, and he said the agency would soon begin reaching out to talk with the industry about a technical guidance document.

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