The Pennsylvania Department of Environmental Protection (DEP) has ordered a local gas driller to stop operations after discovering natural gas and other contaminants in nearby private water supplies.

The cease and desist order requires Catalyst Energy Inc. to stop all drilling and hydraulic fracturing operations at 36 shallow, non-Marcellus Shale wells located in Forest County.

The DEP said an investigation found natural gas from Catalyst operations, as well as elevated levels of iron and manganese, in the water supplies serving two homes located near the drilling site.

The DEP got complaints in January about odd smelling and cloudy water in the area, and issued notices of violation to Catalyst in February and March for groundwater contamination. A follow-up investigation in late March confirmed the presence of natural gas in the water supplies.

Because of new well construction standards that went into effect in February, Catalyst must now figure out which wells caused the gas migration, and update the DEP every 10 days on the status of that investigation (see Shale Daily, Nov. 19, 2010). Catalyst also must immediately provide temporary water systems for the two houses and either fix or replace the contaminated water supplies by July 1.

Catalyst declined to comment about the order.

In 2010 the DEP gave Catalyst 36 permits to drill wells in the Yellow Hammer area of Hickory Township in Forest County. Since then the company drilled 22 wells, a combination of oil and natural gas wells, at an average depth between 1,500 and 3,000 feet, according to the DEP. Marcellus shale wells run 5,000 feet or more.

The DEP issued 27 notices of violation to Catalyst in 2010, of which it resolved half.

Although Forest County is located within the Marcellus fairway that runs from northeastern to southwestern Pennsylvania, drilling there is mostly for conventional supplies. Of the 1,716 wells drilled in the county over the past decade, only one is a producing Marcellus well, according to DEP reports.

Almost half of the sparsely populated county sits within the boundaries of the Allegheny National Forest and many of the property owners in the county use the area for second homes.

Gas migration is as old as drilling itself, but several recent cases have made national headlines.

In late 2010 Cabot Oil & Gas and the DEP agreed to a settlement over a gas migration case in Dimock (see Daily GPI, Dec. 17, 2010) that in part led to the new well standards in the state. Meanwhile, the Railroad Commission of Texas recently cleared Range Resources Corp. of charges that it fouled two North Texas water wells because of Barnett Shale drilling (see Daily GPI, March 23).

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