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Pennsylvania Oil/Gas Trade Groups Step-Up Fight Against State Regulators

The Pennsylvania Independent Oil and Gas Association (PIOGA) is considering legal action against Democratic Gov. Tom Wolf's administration for a series of moves that led to changes at the state Department of Environmental Protection (DEP) and new draft rules for the industry that are expected to be implemented next year.

In a letter to members of the Oil and Gas Technical Advisory Board (TAB), which consults the DEP about rules and regulations related to the oil and gas industry, PIOGA questioned the administration's move to dismiss former board members and appoint new ones under the leadership of Wolf's pick for DEP secretary, John Quigley, a former environmental advocate (see Shale Daily, Feb. 23; Jan. 14).

That announcement came just before the DEP proposed earlier this month to tighten regulations on the industry after four years of work to revise Chapter 78 of the state code, which sets out environmental protection standards (see Shale Daily, March 9; May 13, 2014).

"It appears that the purged TAB members' extensive and constructive but critical commentary of the Chapter 78 rulemaking may have played some role in their removal," wrote PIOGA General Counsel Kevin Moody in the letter. "As the governor's appointees, you are placed in a difficult political position by being asked to approve changes to TAB's bylaws that go beyond the statutory directives to reflect the governor's view of what TAB should be,"

PIOGA claims that despite broad changes that were passed with the omnibus oil and gas law Act 13 of 2012, the general assembly never made any changes to TAB's provision in the law (seeShale Daily, Feb. 15, 2012). In addition to appointing new members to the board, the administration also appointed four new non-voting members, including those from the Pennsylvania Environmental Council and Carnegie Mellon University, to better represent the public's interests. But under state law, the group is expected to be made up of five industry-related members.

"While your situation presents a political problem, it does not present a dilemma because your legal obligation is clear," Moody wrote. "Your oaths of office require you to act in accordance with law, and the law concerning TAB's composition and scope is clear -- and it does not provide for the appointment of additional members, whether voting or non-voting, for any purpose, no matter how laudable."

A DEP representative said the agency staunchly disagrees with the letter and noted that state law sets a minimum of five voting members on the board. The agency added that it remains committed to transparency as well.

PIOGA's objections come less than a month after the Marcellus Shale Coalition (MSC) blasted the recently proposed Chapter 78 changes at this year's first TAB meeting. Under Quigley, the DEP is proposing several new provisions that are currently open for public comment until May 19.

The proposals call for centralized wastewater impoundments to either close within three years of the new rules' implementation, or be upgraded and re-permitted. Public resources, such as schools, playgrounds and drinking water protection areas will require additional consideration and the draft regulations would also establish new requirements for noise control, tighter standards for drilling near waterways and locating orphaned, abandoned and active wells, among other things.

The MSC not only questioned the legality of some of those changes, but also said if implemented, the oil and gas industry would be subject to more stringent regulations than other industries.

Earlier this month, sources told NGI's Shale Daily that the regulatory landscape under the new administration has markedly shifted, but attitudes were mixed about how strained the relationship between the DEP, the administration and the industry has become (see Shale Daily, April 8).

Lawmakers are now entering the fray as well. Republican state Rep. John Maher, chairman of the House Environmental Resources and Energy Committee, recently sent a letter to Quigley questioning the administration's move to expand TAB with non-voting members. The Wolf administration has not directly commented about changes at the DEP or the Chapter 78 update.

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