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Pennsylvania Ruling Leaves DEP With 'Nothing to Waive'

Pennsylvania Gov. Tom Corbett's energy executive said "it's not surprising or alarming" that the state Department of Environmental Protection (DEP) has never denied an operator's request for a waiver to the stream and wetland setback requirements enshrined in Act 13, the state's omnibus Marcellus Shale law.

But in an interview Friday, Patrick Henderson conceded that last month's state Supreme Court ruling that struck down portions of the law left the DEP "with nothing to waive right now," and a host of legislative fixes that needed to be made.

In a 162-page opinion issued on Dec. 19, the high court struck down portions of Act 13 and zeroed in on the DEP's ability to issue the waivers (see Shale Daily, Dec. 20, 2013). Since several parts of the law were intertwined, they were all invalidated.

Under Act 13, well pads and unconventional gas wells could not be within 100 and 300 feet, respectively, of a stream or wetland. But the law stipulated that operators could request a waiver on the grounds that they submit a plan to the DEP showing it would take other steps to ensure waterways were protected.

Henderson confirmed that the DEP issued waivers for 74 well pads and 147 unconventional gas wells during 2013. But he emphasized that operators went through an intensive process to get the waivers.

"The DEP -- through technical guidance, documents and a whole host of other policies -- has laid [the process] out to the operators in advance," Henderson said. "If they are going to come in for a waiver, they are going to need to demonstrate why they believe they qualify for one, and how they are going to protect that waterway, what additional measures they are going to take.

"DEP has laid out what they are going to be looking for if operators are going to be operating in certain terrains or habitats. The applicant is going to have a fairly good idea of what DEP wants."

Henderson said the state's Oil & Gas Act mandated that the DEP either issue or deny a permit within 45 days, but Act 13 gave regulators the option of extending it an additional 15 days, to 60 days total, if operators requested a waiver.

"There is back-and-forth [during that time frame]," Henderson said. "They will talk with DEP to see if their actions are sufficient. It's a process. And the numbers bear out that only about 5% of the permit applications that come in seek a waiver to be within that setback."

The ruling has the potential to adversely impact nearly half of the rural townships where drilling is currently taking place because they haven't enacted zoning ordinances or other environmental protections. Corbett said as much, calling the ruling "unacceptable" and pleading with oil and gas operators and their supporters to adhere to Act 13's old requirements (see Shale Daily, Jan. 6; Dec. 27, 2013). In the meantime, the DEP and the state Public Utilities Commission have filed a motion asking the Supreme Court to reconsider its decision (see Shale Daily, Jan. 3).

Henderson said the state was entering an interim period where operators would be asked to voluntarily adhere "to the spirit and intent" of Act 13.

"Long range, we would like to see the setbacks and a waiver process that meets the court's blessing ultimately re-enacted by the legislature," he said. "We would like that certainty written into the statute for the benefit of waterways. But we're not going to be able to get there until some of the other court matters are resolved at the Commonwealth Court.

"Technically, there's actually nothing for the DEP to waive right now because the court struck down the setbacks. We have called upon the industry to anticipate being 100 or 300 feet or greater from the waterway. And in those 5% of cases, to work with DEP on what those additional protective measures should be."

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