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Pennsylvania’s Legacy Oil, Gas Production Addressed in Legislation

Republican lawmakers in the Pennsylvania House and Senate have introduced companion bills that would enact an updated version of the Oil and Gas Act of 1984 to clarify language and address the current challenges facing conventional producers

State Rep. Martin Causer introduced House Bill (HB) 2154 in an ongoing fight to “ensure fair regulation” for the state’s legacy producers. State Sen. Scott Hutchinson, who has been pushing for similar legislation since last year, has also introduced Senate Bill (SB) 1088.

The legislation comes almost two years after the General Assembly passed a bill Hutchinson sponsored that scrapped what would have been new regulations for the conventional industry and required the state Department of Environmental Protection to rewrite the package.

Those rules were written at the same time as those for unconventional producers. Opponents of the conventional rules successfully argued that they were too burdensome and similar to those drafted for better-financed shale producers. While shale gas production has continued to increase in the state, the glut has pushed down prices and hit the conventional industry hard.

Causer said his proposal to redraft the Oil and Gas Act includes several regulatory updates and clarifications, and would serve as the legislative framework for any future changes to rules impacting the conventional oil and gas industry. The legislation, his office said, has been developed in large part by the Penn Grade Crude Advisory Council, which was created in 2016 to advise and assist the DEP in crafting regulations for the state’s more than 150-year old conventional industry.

While legacy producers operate under the Oil and Gas Act, the state’s omnibus energy law, Act 13 of 2012, required the DEP to update environmental protection standards for producers. Act 13 was crafted in response to the advent of unconventional drilling and does not mention conventional producers or the shallower wells they develop. But the law stipulated that regulations would have to be promulgated to meet its requirements, which has indirectly extended to conventional producers.

“Although Act 13 was intended to address new issues with the unconventional industry, it also placed an unbearable burden on the much smaller conventional producers, Causer said. “The operations are very different, and the regulations must be as well.”

Both Hutchinson and Causer represent districts that include parts of Northwest Pennsylvania, which has long been home to the state’s legacy producers. HB 2154 was last referred to the House Environmental Resources and Energy Committee, while SB 1088 was referred to the Senate energy committee.

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