PRINTER'S NO.  2689

  

THE GENERAL ASSEMBLY OF PENNSYLVANIA

  

HOUSE BILL

 

No.

1950

Session of

2011

  

  

INTRODUCED BY ELLIS, S. H. SMITH, TURZAI, SAYLOR, REED, ADOLPH, MAJOR, STEVENSON, VEREB, ROSS, GROVE, MARSHALL, HELM, VULAKOVICH, P. COSTA, GERGELY, OBERLANDER, READSHAW, MOUL, CHRISTIANA, TALLMAN AND EVERETT, NOVEMBER 1, 2011

  

  

REFERRED TO COMMITTEE ON FINANCE, NOVEMBER 1, 2011  

  

  

  

AN ACT

  

1

Amending Titles 27 (Environmental Resources) and 58 (Oil and

2

Gas) of the Pennsylvania Consolidated Statutes, requiring

3

rents and royalties from oil and gas leases of Commonwealth

4

land to be placed in a special fund to be used for

5

conservation, recreation, dams, flood control and certain

6

interfund transfers; authorizing the Secretary of

7

Conservation and Natural Resources to determine the need for

8

and location of such projects and to acquire the necessary

9

land; providing for interfund transfers; authorizing counties

10

to impose and collect an unconventional gas well impact fee;

11

providing for distribution of fees and for the Oil and Gas

12

Lease Fund; consolidating the Oil and Gas Act; and repealing

13

an act relating to the establishment of the Oil and Gas Lease

14

Fund and the Oil and Gas Act.

15

The General Assembly of the Commonwealth of Pennsylvania

16

hereby enacts as follows:

17

Section 1.  Title 27 of the Pennsylvania Consolidated

18

Statutes is amended by adding chapters to read:

19

CHAPTER 33

20

OIL AND GAS

21

Subchapter

22

A.  (Reserved)

23

B.  Oil and Gas Lease Fund

 


1

SUBCHAPTER A

2

(RESERVED)

3

SUBCHAPTER B

4

OIL AND GAS LEASE FUND

5

Sec.

6

3301.  Definitions.

7

3302.  Oil and Gas Lease Fund.

8

3303.  Powers and duties of secretary.

9

3304.  Appropriation of moneys.

10

3305.  Interfund transfers.

11

§ 3301.  Definitions.

12

The following words and phrases when used in this chapter

13

shall have the meanings given to them in this section unless the

14

context clearly indicates otherwise:

15

"Department."  The Department of Conservation and Natural

16

Resources of the Commonwealth.

17

"Fund."  The Oil and Gas Lease Fund established by this

18

subchapter.

19

"Secretary."  The Secretary of Conservation and Natural

20

Resources of the Commonwealth.

21

§ 3302.  Oil and Gas Lease Fund.

22

(a)  Establishment.--The Oil and Gas Lease Fund is

23

established in the State Treasury.

24

(b)  Deposits.--All rents and royalties from oil and gas

25

leases of any land owned by the Commonwealth, except rents and

26

royalties received from game and fish lands, shall be placed in

27

the fund to be used exclusively:

28

(1)  for conservation, recreation, dams or flood control;

29

(2)  to match any Federal grants which may be made for

30

any of the purposes enumerated in this subchapter; and

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1

(3)  for interfund transfers as provided in section 3305

2

(relating to interfund transfers).

3

§ 3303.  Powers and duties of secretary.

4

The secretary shall have the following powers and duties:

5

(1)  To determine, in the secretary's discretion, the

6

need for and the location of any project authorized by this

7

chapter.

8

(2)  To acquire in the name of the Commonwealth by

9

purchase, condemnation or otherwise such lands as may be

10

needed.

11

§ 3304.  Appropriation of moneys.

12

All the moneys from time to time paid into the fund are

13

specifically appropriated on a continuing basis to the

14

department to carry out the purposes of this subchapter.

15

§ 3305.  Interfund transfers.

16

Transfers shall be made between funds in the State Treasury

17

as follows:

18

(1)  On July 1, 2013, and each July 1 thereafter, an

19

amount equal to 25% of the total moneys received from the

20

prior fiscal year shall be transferred from the fund to the

21

Environmental Stewardship Fund for the purpose of plugging

22

abandoned oil and gas wells and other uses authorized by law

23

for the Environmental Stewardship Fund.

24

(2)  (i)  Beginning July 1, 2014, a total of $40,000,000

25

shall be transferred from the fund to the Hazardous Sites

26

Cleanup Fund for the purpose of remedial response or

27

remedy at oil and gas well sites and other uses

28

authorized by law for the Hazardous Sites Cleanup Fund.

29

(ii)  On July 1, 2015, and each July 1 thereafter,

30

the following shall apply:

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1

(A)  the sum of the amount transferred under

2

subparagraph (i) during the prior fiscal year; and

3

(B)  an amount equal to the percentage change in

4

the Consumer Price Index for All Urban Consumers from

5

the prior fiscal year, multiplied by the amount in

6

clause (A),

7

shall be transferred from the fund to the Hazardous Sites

8

Cleanup Fund for the purpose specified in subparagraph

9

(i).

10

(3)  On July 1, 2013, and each July 1 thereafter, an

11

amount equal to 5% of the total moneys received from the

12

prior fiscal year, but not to exceed $5,000,000, shall be

13

transferred from the fund to the several counties, school

14

districts and townships entitled to receive payment from the

15

Commonwealth in lieu of taxes under the act of May 17, 1929

16

(P.L.1798, No.591), referred to as the Forest Reserves

17

Municipal Financial Relief Law. The moneys transferred under

18

this paragraph shall be allocated to each county, school

19

district and township based on the number of acres of land in

20

the county, school district or township to which the payment

21

under that act applies in proportion to the aggregate number

22

of acres of all such lands of the counties, school districts

23

and townships in this Commonwealth.

24

(4)  On July 1, 2013, and each July 1 thereafter, a total

25

of $15,000,000 shall be transferred from the fund to the

26

Conservation District Fund. These funds shall be distributed

27

in a manner consistent with the act of May 15, 1945 (P.L.547,

28

No.217), known as the Conservation District Law, and the

29

provisions of the State Conservation Commission's

30

Conservation District Fund Allocation Program—Statement of

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1

Policy under 25 Pa. Code Ch. 83 Subch. B (relating to

2

Conservation District Fund Allocation Program—Statement of

3

Policy).

4

CHAPTER 35

5

WELLS

6

Subchapter

7

A.  Unconventional Gas Wells

8

B.  (Reserved)

9

SUBCHAPTER A

10

UNCONVENTIONAL GAS WELLS

11

Sec.

12

3501.  Short title.

13

3502.  Definitions.

14

3503.  Unconventional gas well impact fee.

15

3504.  (Reserved).

16

3505.  (Reserved).

17

3506.  Administration.

18

3506.1.  Well information.

19

3506.2.  Payment confirmation.

20

3506.3.  County authority.

21

3506.4.  Enforcement.

22

3506.5.  Examinations.

23

3507.  Deposit of fees.

24

3508.  Allocation and distribution of fees.

25

3509.  Calculation of payments.

26

3510.  Recordkeeping and State reporting.

27

3511.  Expiration.

28

§ 3501.  Short title.

29

This subchapter shall be known and may be cited as the

30

Unconventional Gas Well Impact Act.

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1

§ 3502.  Definitions.

2

The following words and phrases when used in this subchapter

3

shall have the meanings given to them in this section unless the

4

context clearly indicates otherwise:

5

"Association."  A partnership, limited partnership or any

6

other form of unincorporated enterprise owned or conducted by

7

two or more persons.

8

"Coal bed methane."  Gas that can be produced from coal beds,

9

coal seams, mined-out areas or gob wells.

10

"Corporation."  A corporation, joint stock association,

11

limited liability company, business trust or any other

12

incorporated enterprise organized under the laws of the United

13

States, this Commonwealth or any other state, territory or

14

foreign country or dependency.

15

"Department."  The Department of Environmental Protection of

16

the Commonwealth.

17

"Highway mileage."  The number of miles of public roads and

18

streets most recently certified by the Department of

19

Transportation as eligible for distribution of liquid fuels

20

funds under the act of June 1, 1956 (1955 P.L.1944, No.655),

21

referred to as the Liquid Fuels Tax Municipal Allocation Law.

22

"Municipality."  A city, borough, incorporated town or

23

township.

24

"Natural gas."  A fossil fuel consisting of a mixture of

25

hydrocarbon gases, primarily methane, possibly including ethane,

26

propane, butane, pentane, carbon dioxide, oxygen, nitrogen and

27

hydrogen sulfide and other gas species. The term includes gas

28

from oil fields known as associated gas or casing head gas,

29

natural gas fields known as nonassociated gas, coal beds, shale

30

beds and other formations. The term does not include coal bed

- 6 -

 


1

methane.

2

"Nonproducing well."  A natural gas well that produces an

3

average of less than 90,000 cubic feet of natural gas per day

4

during a calendar year.

5

"Operator."  A person or its subsidiary, affiliate or holding

6

company that holds a permit or other authorization to engage in

7

the business of severing natural gas for sale, profit or

8

commercial use from an unconventional well in this Commonwealth.

9

The term does not include a person who severs natural gas from a

10

storage field.

11

"Person."  A natural person or a corporation, fiduciary,

12

association or other entity, including the Commonwealth and any

13

of its political subdivisions, instrumentalities and

14

authorities. When the term is used in a provision prescribing

15

and imposing a penalty or imposing a fine or both, the term

16

shall include a member of an association and an officer of a

17

corporation.

18

"Rate."  The rate under section 3503 (relating to

19

unconventional gas well impact fee).

20

"Reporting period."  The fiscal year in which a well impact

21

fee is assessed.

22

"Unconventional gas well."  A bore hole drilled or being

23

drilled for the purpose of or to be used for producing oil or

24

gas from a geologic shale formation existing below the base of

25

the Elk Sandstone or its geologic equivalent stratigraphic

26

interval where oil or gas generally cannot be produced at

27

economic flow rates or in economic volumes except by wells

28

stimulated by hydraulic fracture treatments, a horizontal well

29

bore or by using multilateral well bores or other techniques to

30

expose more of the formation of the well bore.

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1

"Unconventional gas well impact fee."  A fee that is adopted

2

under section 3503 (relating to unconventional gas well impact

3

fee) on each unconventional well producing natural gas within

4

this Commonwealth.

5

§ 3503.  Unconventional gas well impact fee.

6

(a)  Imposition.--By enactment of an ordinance by the

7

governing body of a county, except as set forth in subsection

8

(b), a county may impose an unconventional gas well impact fee

9

on each unconventional gas well that is located on a well pad

10

and produces natural gas within the county.

11

(b)  Exemptions.--The unconventional gas well impact fee

12

shall not be imposed on:

13

(1)  nonproducing wells; or

14

(2)  unconventional gas wells in which the natural gas is

15

used directly by a consumer.

16

(c)  Fee for existing unconventional wells.--The fee for an

17

unconventional well producing natural gas which is in existence

18

on the effective date of the ordinance under subsection (a)

19

shall be as follows:

20

(1)  For the first year of production following the

21

effective date of the ordinance, not more than $40,000.

22

(2)  For the second year of production following the

23

effective date of the ordinance, not more than $30,000.

24

(3)  For the third year of production following the

25

effective date of the ordinance, not more than $20,000.

26

(4)  For the fourth year of production through the tenth

27

year of production following the effective date of the

28

ordinance, not more than $10,000.

29

(d)  Fee for new unconventional wells.--The fee for an

30

unconventional well producing natural gas drilled after the

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1

effective date of the ordinance under subsection (a) shall be as

2

follows:

3

(1)  For the first year of production, not more than

4

$40,000.

5

(2)  For the second year of production, not more than

6

$30,000.

7

(3)  For the third year of production, not more than

8

$20,000.

9

(4)  For the fourth year of production through the tenth

10

year of production, not more than $10,000.

11

(e)  Vertical unconventional well fee.--

12

(1)  The fee for an unconventional vertical well shall be

13

not more than 25% of the fee established in subsections (c)

14

and (d).

15

(2)  For purposes of this subsection, an unconventional

16

vertical well shall be defined as an unconventional well

17

producing oil or gas from a geologic shale formation existing

18

below the base of the Elk Sandstone or its geologic

19

equivalent stratigraphic interval and utilizes hydraulic

20

fracture treatment through a single vertical well bore.

21

(f)  Prohibition.--

22

(1)  Under no circumstances may an operator make an

23

unconventional gas well impact fee, or any other levy related

24

to the removal or extraction of natural gas, an obligation,

25

indebtedness or liability of a landowner, leaseholder or

26

other person in possession of real property upon which such

27

removal or extraction occurs.

28

(2)  An agreement between an operator and a landowner,

29

leaseholder or other person in possession of real property

30

upon which removal or extraction of natural gas occurs that

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1

violates paragraph (1) shall be null and void.

2

(g)  Retroactivity prohibited.--No fee shall be imposed to

3

cover a period of natural gas production which occurred prior to

4

the effective date of the ordinance.

5

§ 3504.  (Reserved).

6

§ 3505.  (Reserved).

7

§ 3506.  Administration.

8

(a)  Report.--By April 1 of the year after enactment of an

9

ordinance imposing a fee under this chapter and each April 1

10

thereafter, each producer shall submit a report and payment of

11

the fee with the county on a form prescribed by the department

12

for the previous calendar year. The report shall include the

13

following:

14

(1)  The number of unconventional wells of a producer in

15

each municipality within the county.

16

(2)  The total number of cubic feet of natural gas

17

severed by the producer for each unconventional well

18

identified under paragraph (1) during the previous calendar

19

year.

20

(3)  The date that each unconventional well identified

21

under paragraph (1) began or ceased the production of natural

22

gas.

23

(b)  Fee due date.--The fee imposed under this chapter shall

24

be due by April 1 of the year after enactment of an ordinance

25

imposing the fee and each April 1 thereafter. The fee shall

26

become delinquent if not remitted to the county on the reporting

27

date.

28

§ 3506.1.  Well information.

29

(a)  List.--Upon request, the department shall provide a

30

county with a list of all unconventional wells that have

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1

received a well permit from the department issued under this

2

chapter. The list shall be updated on a monthly basis. In lieu

3

of providing the list to each county, the department may

4

maintain a list on its publicly accessible Internet website if

5

the list is updated on a monthly basis.

6

(b)  Updates.--A producer shall notify the county within 30

7

days from the date the unconventional well began or ceased the

8

production of natural gas.

9

§ 3506.2.  Payment confirmation.

10

Prior to issuing a permit to drill an unconventional well in

11

this Commonwealth, the department shall require the permit

12

applicant to certify in its well permit application that the

13

producer has paid all fees that may be owed under this chapter.

14

The department may deny a well permit application if it finds

15

that the producer falsified this certification.

16

§ 3506.3.  County authority.

17

(a)  Powers.--A county may make all inquiries and

18

determinations necessary to calculate and collect a fee imposed

19

under this chapter, including, if applicable, interest and

20

penalties.

21

(b)  Notice.--If a county determines that a fee imposed under

22

this chapter has not been paid in full, it may issue a notice of

23

the amount due and demand for payment and shall set forth the

24

basis for the determination.

25

(c)  Address.--Notice of failure to pay the correct fee shall

26

be sent to the producer at its registered address via certified

27

mail.

28

(d)  Time period.--A county may challenge the amount of a fee

29

paid under this chapter within three years after the date the

30

report under this chapter is filed.

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1

(e)  Intent.--If no report is filed or a producer files a

2

false or fraudulent return with the intent to evade a fee, an

3

assessment of the amount owed may be made at any time.

4

§ 3506.4.  Enforcement.

5

(a)  Assessment.--A county may assess interest on any

6

delinquent fee imposed under this chapter at the rate prescribed

7

under section 806 of the act of April 9, 1929 (P.L.343, No.176),

8

known as The Fiscal Code.

9

(b)  Penalty.--In addition to the interest under subsection

10

(a), if a producer fails to make timely payment of the fee, a

11

penalty shall be added to the amount of the fee due. The amount

12

of the penalty shall be 5% for each month, or fraction of a

13

month, during which the failure continues, not to exceed 25% in

14

the aggregate.

15

(c)  Timely payment.--If a county determines that a producer

16

has not made a timely payment of the fee, the county shall send

17

a written notice of the amount of the deficiency to the producer

18

within 30 days from the date of determining the deficiency. If

19

the producer has not provided a complete and accurate statement

20

of the volume of natural gas extracted for the payment period,

21

the county may estimate the volume in its deficiency notice.

22

(d)  Remedies.--The remedies provided under this chapter

23

shall be in addition to any other remedies provided at law or in

24

equity.

25

(e)  Lien.--Fines, fees, interest and penalties shall be

26

collectible in the manner provided by law for the collection of

27

debts. If the producer liable to pay any amount neglects or

28

refuses to pay the amount after demand, the amount, together

29

with costs that may accrue, shall be a judgment in favor of the

30

county upon the property of the producer, if the judgment has

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1

been entered and docketed of record by the prothonotary of the

2

county where the property is situated.

3

§ 3506.5.  Examinations.

4

(a)  Access.--A county which has imposed a fee under this

5

chapter, or its authorized agents or representatives, shall:

6

(1)  Have access to the books, papers and records of any

7

producer in order to verify the accuracy and completeness of

8

a report filed or fee paid under this chapter.

9

(2)  Require and compel the preservation and production

10

of all books, papers and records for any period deemed proper

11

not to exceed three years from the end of the calendar year

12

to which the records relate.

13

(3)  Examine any employee of a producer concerning the

14

severing of natural gas subject to a fee or any matter

15

relating to the enforcement of this chapter.

16

(b)  Unauthorized disclosure.--

17

(1)  Any information obtained by a county as a result of

18

any report, examination, investigation or hearing under this

19

chapter shall be confidential and shall be exempt from

20

disclosure under the provisions of the act of February 14,

21

2008 (P.L.6, No.3), known as the Right-to-Know Law, and shall

22

not be disclosed except in accordance with judicial order or

23

as otherwise provided by law.

24

(2)  An individual unlawfully divulging the information

25

described under this subsection commits a misdemeanor and

26

shall, upon conviction, be sentenced to pay a fine of not

27

more than $1,000 and costs of prosecution or to imprisonment

28

for not more than one year, or both.

29

§ 3507.  Deposit of fees.

30

(a)  Establishment.--Each county imposing a fee under this

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1

chapter shall establish an interest-bearing account designed

2

solely for fees.

3

(b)  Deposit.--All fees collected by a county imposing a fee

4

under this chapter shall be deposited into the account described

5

under subsection (a).

6

§ 3508.  Allocation and distribution of fees.

7

(a)  Allocation of fees.--The fees deposited into the account

8

established under section 3507 (relating to deposit of fees)

9

shall be allocated as follows:

10

(1)  Seventy-five percent of the fees shall be allocated

11

to the county and its municipalities in the manner provided

12

under subsection (b).

13

(2)  Twenty-five percent of the fees shall be allocated

14

to the Commonwealth and distributed in the manner provided

15

under subsections (c) and (d).

16

(b)  Distribution of fees to county and municipalities.--The

17

fees allocated to the county and its municipalities under

18

subsection (a)(1) shall be distributed as follows:

19

(1)  Thirty-six percent of the fees shall be retained by

20

the county where the producing unconventional wells are

21

located.

22

(2)  Thirty-seven percent of the fees shall be

23

distributed to the municipalities where producing

24

unconventional wells are located. The amount for each

25

municipality shall be determined using a formula that divides

26

the number of producing unconventional wells in the

27

municipality by the number of producing unconventional wells

28

in the county and multiplies the resulting percentage by the

29

amount available for distribution under this subparagraph.

30

(3)  Twenty-seven percent of the fees shall be

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1

distributed to all municipalities in the county where

2

producing unconventional wells are located as follows:

3

(i)  Fifty percent shall be distributed to all

4

municipalities using a formula that divides the

5

population of the municipality within the county by the

6

total population of the county and multiplies the

7

resulting percentage by the amount available for

8

distribution to the county under this subparagraph.

9

(ii)  Fifty percent shall be distributed to each

10

municipality using a formula that divides the highway

11

mileage of the municipality within the county by the

12

total highway mileage of the county and multiplies the

13

resulting percentage by the amount available for

14

distribution to the county under this subparagraph.

15

(c)  Distribution of fees to Commonwealth.--The fees

16

allocated to the Commonwealth under subsection (a)(2) shall be

17

remitted to the Commonwealth for deposit into a restricted

18

account in the General Fund of the Commonwealth dedicated solely

19

for fees. The funds are hereby appropriated and shall be

20

distributed as follows and as set forth under subsection (e):

21

(1)  Seventy percent to the Department of Transportation

22

for road, bridge, rail and other transportation

23

infrastructure improvements to address impacts from

24

unconventional national gas development.

25

(2)  Ten and one-half percent to the department, not to

26

exceed $10,000,000 annually, for the regulation of

27

unconventional gas wells and the plugging of abandoned and

28

orphan gas wells within the Commonwealth.

29

(3)  Seven and one-half percent to the Public Utility

30

Commission, not to exceed $2,000,000 annually, for the

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1

enhancement, inspection and enforcement of pipeline safety

2

standards as required by law related to the safe transport of

3

gas and hazardous liquids.

4

(4)  Four and one-half percent to the Pennsylvania

5

Emergency Management Agency, not to exceed $2,000,000

6

annually, for emergency response planning, training and

7

coordination associated with unconventional natural gas

8

production activity within the Commonwealth.

9

(5)  Three and three-quarters percent to the Department

10

of Health, not to exceed $2,000,000 annually, for collecting

11

and disseminating information, preparing and conducting

12

health care provider outreach and education and investigating

13

health-related complaints and other uses associated with

14

unconventional natural gas production activity within this

15

Commonwealth.

16

(6)  Three and three-quarters percent to the Office of

17

State Fire Commissioner, not to exceed $2,000,000 annually,

18

for the development, delivery and sustainment of training

19

programs for first responders and acquisition of specialized

20

equipment necessary for emergency response.

21

(d)  Additional distribution of fees to Department of

22

Transportation.--In addition to the distribution of fees to the

23

Department of Transportation under subsection (c)(1), any funds

24

remaining in the restricted account after distribution of fees

25

under subsection (c)(2), (3), (4), (5) and (6) are hereby

26

appropriated shall be distributed to the Department of

27

Transportation.

28

(e)  Continuing nature.--

29

(1)  The distributions under subsections (c) and (d)

30

shall be executive authorizations.

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1

(2)  The appropriations under subsections (c) and (d)

2

shall be continuing appropriations. Those appropriations

3

shall not lapse at the end of any fiscal year.

4

(f)  Timing of distribution.--A county shall distribute the

5

fees authorized under this chapter within 45 days after the date

6

the fees are received.

7

(g)  Use of funds by counties and municipalities.--A county

8

or municipality receiving fees under this section shall make use

9

of the fees received only for the following purposes associated

10

with unconventional natural gas production within the county or

11

municipality:

12

(1)  Construction, reconstruction, maintenance and repair

13

of roadways, bridges and public infrastructure.

14

(2)  Water, storm water and sewer systems, including

15

construction, reconstruction, maintenance and repair.

16

(3)  Emergency preparedness and response, including

17

police, fire, hazardous material response, 911, equipment

18

acquisition, responder recruitment and other services.

19

(4)  Preservation and reclamation of surface and

20

subsurface waters and water supplies, including drinking

21

water monitoring and testing.

22

(5)  Records management, geographic information systems

23

and information technology.

24

(6)  Projects that increase the availability of

25

affordable housing, either for sale or rental, to residents

26

whose annual income is less than the area median income.

27

(7)  Delivery of social services, including domestic

28

relations, drug and alcohol treatment, job training and

29

counseling.

30

(8)  Assistance to the county conservation district for

- 17 -

 


1

inspection, oversight and enforcement of unconventional

2

natural gas development.

3

(9)  County or municipal planning.

4

(10)  Local tax reduction.

5

§ 3509.  Calculation of payments.

6

(a)  General rule.--The county treasurer of a county that

7

imposes and collects the unconventional gas well impact fee

8

shall certify the number of all unconventional gas wells located

9

within each municipality of the county based upon the

10

appropriate reports provided by the department.

11

(b)  Payments to municipalities.--The county treasurer of a

12

county that imposes and collects the unconventional gas well

13

impact fee shall pay to municipalities the amounts required

14

under this subchapter.

15

§ 3510.  Recordkeeping and State reporting.

16

(a)  General rule.--Commencing in calendar year 2012 and each

17

year thereafter, before December 1, each county that imposes and

18

collects the unconventional gas well impact fee authorized by

19

this subchapter shall prepare and deliver a report to the

20

Secretary of the Senate and the Chief Clerk of the House of

21

Representatives detailing the expenditure of the funds collected

22

under this subchapter.

23

(b)  Audit.--The Department of Community and Economic

24

Development may audit a county's and municipality's expenditure

25

of the funds.

26

(c)  Availability of records.--A county and municipality that

27

receives the funds shall make its financial records and other

28

documents relating to its expenditure of the funds available to

29

the department.

30

(d)  Time.--Reports shall be prepared no later than June 30

- 18 -

 


1

of the year following the initial receipt of any fees

2

distributed under this section and each June 30 thereafter.

3

(e)  Location.--Reports shall be published on the county or

4

municipality's publicly accessible Internet website. If a

5

municipality does not maintain a publicly accessible Internet

6

website, the municipality shall provide its report to the

7

county, which shall publish the municipality's report on the

8

county's publicly accessible Internet website.

9

§ 3511.  Expiration.

10

(a)  Notice.--The Secretary of the Commonwealth shall, upon

11

the effective date of an act authorizing a severance tax on each

12

unconventional well producing gas in this Commonwealth, submit

13

for publication in the Pennsylvania Bulletin notice of that

14

fact.

15

(b)  Date.--This chapter shall expire on the date of the

16

publication of the notice under subsection (a).

17

SUBCHAPTER B

18

(RESERVED)

19

Section 2.  Title 58 is amended by adding parts to read:

20

PART I

21

PRELIMINARY PROVISIONS

22

(RESERVED)

23

PART II

24

(RESERVED)

25

PART III

26

UTILIZATION

27

Chapter

28

31.  (Reserved)

29

32.  Development

30

CHAPTER 31

- 19 -

 


1

(RESERVED)

2

CHAPTER 32

3

DEVELOPMENT

4

Subchapter

5

A.  Preliminary Provisions

6

B.  General Requirements

7

C.  Underground Gas Storage

8

D.  Eminent Domain

9

E.  Enforcement and Remedies

10

F.  Miscellaneous Provisions

11

SUBCHAPTER A

12

PRELIMINARY PROVISIONS

13

Sec.

14

3201.  Scope of chapter.

15

3202.  Declaration of purpose.

16

3203.  Definitions.

17

§ 3201.  Scope of chapter.

18

This chapter relates to oil and gas.

19

§ 3202.  Declaration of purpose.

20

The purposes of this chapter are to:

21

(1)  Permit optimal development of oil and gas resources

22

of this Commonwealth consistent with protection of the

23

health, safety, environment and property of Pennsylvania

24

citizens.

25

(2)  Protect the safety of personnel and facilities

26

employed in coal mining or exploration, development, storage

27

and production of natural gas or oil.

28

(3)  Protect the safety and property rights of persons

29

residing in areas where mining, exploration, development,

30

storage or production occurs.

- 20 -

 


1

(4)  Protect the natural resources, environmental rights

2

and values secured by the Constitution of Pennsylvania.

3

§ 3203.  Definitions.

4

The following words and phrases when used in this chapter

5

shall have the meanings given to them in this section unless the

6

context clearly indicates otherwise:

7

"Abandoned well."  Any of the following:

8

(1)  A well:

9

(i)  that has not been used to produce, extract or

10

inject any gas, petroleum or other liquid within the

11

preceding 12 months;

12

(ii)  for which equipment necessary for production,

13

extraction or injection has been removed; or

14

(iii)  considered dry and not equipped for production

15

within 60 days after drilling, redrilling or deepening.

16

(2)  The term does not include wells granted inactive

17

status.

18

"Alteration."  An operation which changes the physical

19

characteristics of a well bore, including stimulation or

20

removing, repairing or changing the casing. For the purpose of

21

this chapter only, the term does not include:

22

(1)  Repairing or replacing of the casing if the activity

23

does not affect the depth or diameter of the well bore, the

24

use or purpose of the well does not change and the activity

25

complies with regulations promulgated under this chapter,

26

except that this exclusion does not apply:

27

(i)  to production casings in coal areas when the

28

production casings are also the coal protection casings;

29

or

30

(ii)  when the method of repairing or replacing the

- 21 -

 


1

casing would affect the coal protection casing.

2

(2)  Stimulation of a well.

3

"Board."  The Oil and Gas Technical Advisory Board.

4

"Bridge."  An obstruction placed in a well at any depth.

5

"Building."  An occupied structure with walls and roof within

6

which persons live or customarily work.

7

"Casing."  A string or strings of pipe commonly placed in

8

wells drilled for natural gas or petroleum.

9

"Cement" or "cement grout."  Any of the following:

10

(1)  Hydraulic cement properly mixed with water only.

11

(2)  A mixture of materials adequate for bonding or

12

sealing of well bores as approved by regulations promulgated

13

under this chapter.

14

"Coal mine."  Any of the following:

15

(1)  Operations in a coal seam, including excavated

16

portions, abandoned portions and places actually being

17

worked.

18

(2)  Underground workings and shafts, slopes, tunnels and

19

other ways and openings, including those which are in the

20

course of being sunk or driven, along with all roads and

21

facilities connected with them below the surface.

22

"Coal operator."  A person that operates or proposes to

23

operate a coal mine as an owner or lessee.

24

"Completion of a well."  The date after treatment, if any,

25

that the well is properly equipped for production of oil or gas,

26

or, if the well is dry, the date that the well is abandoned.

27

"Department."  The Department of Environmental Protection of

28

the Commonwealth.

29

"Drilling."  The drilling or redrilling of a well or the

30

deepening of an existing well.

- 22 -

 


1

"Environmental law."  Any of the following:

2

(1)  A Federal statute pertaining to oil and gas

3

operations, public health, safety, natural resources or the

4

environment.

5

(2)  A Federal regulation, rule, administrative order or

6

agency interpretation or guidance pertaining to oil and gas

7

operations, public health, safety, natural resources or the

8

environment.

9

(3)  A Federal judicial decision pertaining to oil and

10

gas operations, public health, safety, natural resources or

11

the environment.

12

(4)  A Commonwealth statute pertaining to oil and gas

13

operations, public health, safety, natural resources or the

14

environment. The term includes any of the following:

15

(i)  The act of June 22, 1937 (P.L.1987, No.394),

16

known as The Clean Streams Law.

17

(ii)  The act of January 8, 1960 (1959 P.L.2119,

18

No.787), known as the Air Pollution Control Act.

19

(iii)  The act of July 7, 1961 (P.L.518, No.268),

20

known as the Delaware River Basin Compact.

21

(iv)  The act of July 25, 1961 (P.L.825, No.359),

22

known as the Oil and Gas Conservation Law.

23

(v)  The act of July 17, 1968 (P.L.368, No.181),

24

referred to as the Susquehanna River Basin Compact Law.

25

(vi)  The act of October 4, 1978 (P.L.864, No.167),

26

known as the Storm Water Management Act.

27

(vii)  The act of November 26, 1978 (P.L.1375,

28

No.325), known as the Dam Safety and Encroachments Act.

29

(viii)  The act of July 7, 1980 (P.L.380, No.97),

30

known as the Solid Waste Management Act.

- 23 -

 


1

(ix)  The act of June 23, 1982 (P.L.597, No.170),

2

known as the Wild Resource Conservation Act.

3

(x)  The act of May 1, 1984 (P.L.206, No.43), known

4

as the Pennsylvania Safe Drinking Water Act.

5

(xi)  The act of July 10, 1984 (P.L.688, No.147),

6

known as the Radiation Protection Act.

7

(xii)  The act of October 5, 1984 (P.L.734, No.159),

8

known as the Worker and Community Right-to-Know Act.

9

(xiii)  The act of December 18, 1984 (P.L.1069,

10

No.214), known as the Coal and Gas Resource Coordination

11

Act.

12

(xiv)  The act of December 19, 1984 (P.L.1093,

13

No.219), known as the Noncoal Surface Mining Conservation

14

and Reclamation Act.

15

(xv)  The act of October 18, 1988 (P.L.756, No.108),

16

known as the Hazardous Sites Cleanup Act.

17

(xvi)  The act of July 6, 1989 (P.L.169, No.32),

18

known as the Storage Tank and Spill Prevention Act.

19

(xvii)  The act of December 7, 1990 (P.L.639,

20

No.165), known as the Hazardous Material Emergency

21

Planning and Response Act.

22

(xviii)  The act of May 19, 1995 (P.L.4, No.2), known

23

as the Land Recycling and Environmental Remediation

24

Standards Act.

25

(xix)  The act of July 4, 2008 (P.L.526, No.43),

26

known as the Great Lakes-St. Lawrence River Basin Water

27

Resources Compact.

28

(xx)  The provisions of 27 Pa.C.S. Ch. 31 (relating

29

to water resources planning)

30

(xxi)  The provisions of 27 Pa.C.S. Ch. 41 (relating

- 24 -

 


1

to environmental laboratory accreditation).

2

(xxii)  The provisions of 27 Pa.C.S. Ch. 62 (relating

3

to waste transportation safety).

4

(xxiii)  The provisions of 30 Pa.C.S. (relating to

5

fish).

6

(xxiv)  The provisions of 34 Pa.C.S. (relating to

7

game).

8

(5)  A regulation, rule, administrative order or agency

9

interpretation or guidance of a Commonwealth agency

10

pertaining to oil and gas operations, public health, safety,

11

natural resources or the environment.

12

(6)  A decision of a court of this Commonwealth

13

pertaining to oil and gas operations, public health, safety,

14

natural resources or the environment.

15

"Fresh groundwater."  Water in that portion of the generally

16

recognized hydrologic cycle which occupies the pore spaces and

17

fractures of saturated subsurface materials.

18

"Gas."  Any of the following:

19

(1)  A fluid, combustible or noncombustible, which is

20

produced in a natural state from the earth and maintains a

21

gaseous or rarified state at standard temperature of 60

22

degrees Fahrenheit and pressure 14.7 PSIA.

23

(2)  Any manufactured gas, byproduct gas or mixture of

24

gases.

25

"Inactivate."  To shut off the vertical movement of gas in a

26

gas storage well by means of a temporary plug or other suitable

27

device or by injecting bentonitic mud or other equally nonporous

28

material into the well.

29

"Linear foot."  A unit or measurement in a straight line on a

30

horizontal plane.

- 25 -

 


1

"Oil."  Hydrocarbons in liquid form at standard temperature

2

of 60 degrees Fahrenheit and pressure 14.7 PSIA, also referred

3

to as petroleum.

4

"Oil and gas operations."  Any of the following:

5

(1)  Exploration for oil and gas. This paragraph includes

6

the conduct of seismic operations.

7

(2)  Siting and locating of oil and gas wells.

8

(3)  Drilling, stimulation and completion of oil and gas

9

wells.

10

(4)  Generation, processing, treatment, storage,

11

transportation and disposal of fresh water, wastewater,

12

wastes, chemicals and other materials directly associated

13

with drilling, stimulation and completion of oil and gas

14

wells.

15

(5)  Production, gathering and collection of oil or gas.

16

(6)  Compression, transmission, measurement and storage

17

of oil or gas.

18

(7)  Reclamation activities.

19

(8)  Construction and use of drilling rigs and pipelines.

20

This paragraph includes equipment directly related to the

21

activities set forth in this paragraph.

22

(9)  Construction and use of access roads, well sites,

23

drilling pads, impoundments, compression stations, processing

24

stations, meter stations and storage tanks. This paragraph

25

includes buildings, facilities or structures, which are

26

directly related to the activities set forth in this

27

paragraph. This paragraph does not include ancillary support,

28

supply and service facilities, the location of which is not

29

dependent on the location of specific wells or pipelines.

30

"Operating coal mine."  Any of the following:

- 26 -

 


1

(1)  An underground coal mine which is producing coal or

2

has been in production of coal at any time during the 12

3

months immediately preceding the date its status is put in

4

question, including contiguous worked-out or abandoned coal

5

mines to which it is connected underground.

6

(2)  An underground coal mine to be established or

7

reestablished under paragraph (1).

8

"Operating well."  A well that is not plugged and abandoned.

9

"Orphan well."  A well abandoned prior to April 18, 1985,

10

that has not been affected or operated by the present owner or

11

operator and from which the present owner, operator or lessee

12

has received no economic benefit other than as a landowner or

13

recipient of a royalty interest from the well.

14

"Outside coal boundaries."  When used in conjunction with the

15

term "operating coal mine," the boundaries of the coal acreage

16

assigned to the coal mine under an underground mine permit

17

issued by the Department of Environmental Protection.

18

"Owner."  A person who owns, manages, leases, controls or

19

possesses a well or coal property. The term does not apply to

20

orphan wells, except where the Department of Environmental

21

Protection determines a prior owner or operator benefited from

22

the well as provided in section 3220(a) (relating to plugging

23

requirements).

24

"Person."  An individual, association, partnership,

25

corporation, political subdivision or agency of the Federal

26

Government, State government or other legal entity.

27

"Petroleum."  Hydrocarbons in liquid form at standard

28

temperature of 60 degrees Fahrenheit and pressure 14.7 PSIA,

29

also referred to as oil.

30

"Pillar."  A solid block of coal surrounded by either active

- 27 -

 


1

mine workings or a mined-out area.

2

"Plat."  A map, drawing or print accurately drawn to scale

3

showing the proposed or existing location of a well or wells.

4

"Reservoir protective area."  The area surrounding a storage

5

reservoir boundary, but within 2,000 linear feet of the storage

6

reservoir boundary, unless an alternate area has been designated

7

by the Department of Environmental Protection, which is deemed

8

reasonably necessary to afford protection to the reservoir,

9

under a conference held in accordance with section 3251

10

(relating to conferences).

11

"Retreat mining."  Removal of coal pillars, ribs and stumps

12

remaining after development mining has been completed in that

13

section of a coal mine.

14

"Secretary."  The Secretary of Environmental Protection of

15

the Commonwealth.

16

"Storage operator."  A person who operates or proposes to

17

operate a storage reservoir as an owner or lessee.

18

"Storage reservoir."  That portion of a subsurface geological

19

stratum into which gas is or may be injected for storage

20

purposes or to test suitability of the stratum for storage.

21

"Unconventional well."  A bore hole drilled or being drilled

22

for the purpose of or to be used for producing oil or gas from a

23

geological shale formation existing below the base of the Elk

24

Sandstone or its geologic equivalent stratigraphic interval

25

where oil or gas generally cannot be produced at economic flow

26

rates or in economic volumes except by one of the following:

27

(1)  Vertical or horizontal well bores stimulated by

28

hydraulic fracture treatments.

29

(2)  Using multilateral well bores or other techniques to

30

expose more of the formation of the well bore.

- 28 -

 


1

"Water management plan."  A plan associated with drilling or

2

completing a well in an unconventional formation that

3

demonstrates that the withdrawal and use of water sources

4

protects those sources as required by law and protects public

5

health, safety and welfare.

6

"Water purveyor."  Any of the following:

7

(1)  The owner or operator of a public water system as

8

defined in section 3 of the act of May 1, 1984 (P.L.206,

9

No.43), known as the Pennsylvania Safe Drinking Water Act.

10

(2)  Any person subject to the act of June 24, 1939

11

(P.L.842, No.365), referred to as the Water Rights Law.

12

"Water source."

13

(1)  Any of the following:

14

(i)  Waters of this Commonwealth.

15

(ii)  A source of water supply used by a water

16

purveyor.

17

(iii)  Mine pools and discharges.

18

(iv)  Any other waters that are used for drilling or

19

completing a well in an unconventional formation.

20

(2)  The term does not include flowback or production

21

waters or other fluids:

22

(i)  which are used for drilling or completing a well

23

in an unconventional formation; and

24

(ii)  which do not discharge into waters of this

25

Commonwealth.

26

"Well."  A bore hole drilled or being drilled for the purpose

27

of, or to be used for, producing, extracting or injecting gas,

28

petroleum or another liquid related to oil or gas production or

29

storage, including brine disposal, but excluding a bore hole

30

drilled to produce potable water. The term does not include a

- 29 -

 


1

bore hole drilled or being drilled for the purpose of, or to be

2

used for:

3

(1)  Systems of monitoring, producing or extracting gas

4

from solid waste disposal facilities, if the bore hole is a

5

well subject to the act of July 7, 1980 (P.L.380, No.97),

6

known as the Solid Waste Management Act, which does not

7

penetrate a workable coal seam.

8

(2)  Degasifying coal seams, if the bore hole is:

9

(i)  used to vent methane to the outside atmosphere

10

from an operating coal mine; regulated as part of the

11

mining permit under the act of June 22, 1937 (P.L.1987,

12

No.394), known as The Clean Streams Law, and the act of

13

May 31, 1945 (P.L.1198, No.418), known as the Surface

14

Mining Conservation and Reclamation Act; and drilled by

15

the operator of the operating coal mine for the purpose

16

of increased safety; or

17

(ii)  used to vent methane to the outside atmosphere

18

under a federally funded or State-funded abandoned mine

19

reclamation project.

20

"Well control emergency."  An incident during drilling,

21

operation, workover or completion that, as determined by the

22

department, poses a threat to public health, welfare or safety,

23

including a loss of circulation fluids, kick, casing failure,

24

blowout, fire and explosion.

25

"Well control specialist."  Any person trained to respond to

26

a well control emergency with a current certification from a

27

well control course accredited by the International Association

28

of Drilling Contractors or other organization approved by the

29

department.

30

"Well operator" or "operator."  Any of the following:

- 30 -

 


1

(1)  The person designated as operator or well operator

2

on the permit application or well registration.

3

(2)  If a permit or well registration was not issued, a

4

person who locates, drills, operates, alters or plugs a well

5

or reconditions a well with the purpose of production from

6

the well.

7

(3)  If a well is used in connection with underground

8

storage of gas, a storage operator.

9

"Wetland."  Areas inundated or saturated by surface or

10

groundwater at a frequency and duration sufficient to support,

11

and which normally support, a prevalence of vegetation typically

12

adapted for life in saturated soil conditions, including swamps,

13

marshes, bogs and similar areas.

14

"Workable coal seams."  A coal seam which:

15

(1)  is actually being mined in the area in question

16

under this chapter by underground methods; or

17

(2)  in the judgment of the Department of Environmental

18

Protection, can reasonably be expected to be mined by

19

underground methods.

20

SUBCHAPTER B

21

GENERAL REQUIREMENTS

22

Sec.

23

3211.  Well permits.

24

3212.  Permit objections.

25

3212.1.  Comments by municipalities.

26

3213.  Well registration and identification.

27

3214.  Inactive status.

28

3215.  Well location restrictions.

29

3215.1.  General restrictions.

30

3216.  Well site restoration.

- 31 -

 


1

3217.  Protection of fresh groundwater and casing requirements.

2

3218.  Protection of water supplies.

3

3219.  Use of safety devices.

4

3219.1.  Well control emergency response.

5

3220.  Plugging requirements.

6

3221.  Alternative methods.

7

3222.  Well reporting requirements.

8

3223.  Notification and effect of well transfer.

9

3224.  Coal operator responsibilities.

10

3225.  Bonding.

11

3226.  Oil and Gas Technical Advisory Board.

12

§ 3211.  Well permits.

13

(a)  Permit required.--No person shall drill or alter a well,

14

except for alterations which satisfy the requirements of

15

subsection (j), without having first obtained a well permit

16

under subsections (b), (c), (d) and (e), or operate an abandoned

17

or orphan well unless in compliance with subsection (l). A copy

18

of the permit shall be kept at the well site during drilling or

19

alteration of the well. No person shall be required to obtain a

20

permit to redrill a nonproducing well if the redrilling:

21

(1)  has been evaluated and approved as part of an order

22

from the department authorizing cleaning out and plugging or

23

replugging a nonproducing well under section 13(c) of the act

24

of December 18, 1984 (P.L.1069, No.214), known as the Coal

25

and Gas Resource Coordination Act; and

26

(2)  is incidental to a plugging or replugging operation

27

and the well is plugged within 15 days of redrilling.

28

(b)  Plat.--

29

(1)  The permit application shall be accompanied by a

30

plat prepared by a competent engineer or a competent

- 32 -

 


1

surveyor, on forms furnished by the department, showing the

2

political subdivision and county in which the tract of land

3

upon which the well to be drilled is located; a list of

4

municipalities adjacent to the well site; the name of the

5

surface landowner of record and lessor; the name of all

6

surface landowners and water purveyors whose water supplies

7

are within 1,000 feet of the proposed well location or, in

8

the case of an unconventional well, within 2,500 feet of the

9

proposed well location; the name of the owner of record or

10

operator of all known underlying workable coal seams; the

11

acreage in the tract to be drilled; the proposed location of

12

the well determined by survey, courses and distances of the

13

location from two or more permanent identifiable points or

14

landmarks on the tract boundary corners; the proposed angle

15

and direction of the well if the well is to be deviated

16

substantially from a vertical course; the number or other

17

identification to be given the well; the workable coal seams

18

underlying the tract of land upon which the well is to be

19

drilled or altered and which shall be cased off under section

20

3217 (relating to protection of fresh groundwater and casing

21

requirements); and any other information needed by the

22

department to administer this chapter.

23

(2)  The applicant shall forward by certified mail a copy

24

of the plat to the surface landowner; the municipality in

25

which the tract of land upon which the well to be drilled is

26

located; the municipalities adjacent to the well; all surface

27

landowners and water purveyors, whose water supplies are

28

within 1,000 feet of the proposed well location or, in the

29

case of an unconventional well, within 2,500 feet of the

30

proposed well location; the owner and lessee of any coal

- 33 -

 


1

seams; and each coal operator required to be identified on

2

the well permit application.

3

(b.1)  Notification.--The applicant shall submit proof of

4

notification with the well permit application. Notification of

5

surface owners shall be performed by sending notice to those

6

persons to whom the tax notices for the surface property are

7

sent, as indicated in the assessment books in the county in

8

which the property is located. Notification of surface

9

landowners or water purveyors whose water supplies are within

10

1,000 feet of the proposed well location shall be on forms, and

11

in a manner prescribed by the department, sufficient to identify

12

the rights afforded those persons under section 3218 (relating

13

to protection of water supplies) and to advise them of the

14

advantages of taking their own predrilling or prealteration

15

survey.

16

(b.2)  Approval.--If the applicant submits to the department

17

written approval of the proposed well location by the surface

18

landowner and the coal operator, lessee or owner of any coal

19

underlying the proposed well location and no objections are

20

raised by the department within 15 days of filing, or if no

21

approval has been submitted and no objections are made to the

22

proposed well location within 15 days from receipt of notice by

23

the department, the surface landowner or any coal operator,

24

lessee or owner, the written approval shall be filed and become

25

a permanent record of the well location, subject to inspection

26

at any time by any interested person.

27

(c)  Applicants.--If the applicant for a well permit is a

28

corporation, partnership or person that is not a resident of

29

this Commonwealth, the applicant shall designate the name and

30

address of an agent for the operator who shall be the attorney-

- 34 -

 


1

in-fact for the operator and who shall be a resident of this

2

Commonwealth upon whom notices, orders or other communications

3

issued under this chapter may be served and upon whom process

4

may be served. Each well operator required to designate an agent

5

under this section shall, within five days after termination of

6

the designation, notify the department of the termination and

7

designate a new agent.

8

(d)  Permit fee.--Each application for a well permit shall be

9

accompanied by a permit fee, established by regulation of the

10

department, which bears a reasonable relationship to the cost of

11

administering this chapter.

12

(e)  Issuance of permit.--The department shall issue a permit

13

within 45 days of submission of a permit application unless the

14

department denies the permit application for one or more of the

15

reasons set forth in subsection (e.1), except that the

16

department shall have the right to extend the period for 15 days

17

for cause shown upon notification to the applicant of the

18

reasons for the extension. The department may impose permit

19

terms and conditions necessary to assure compliance with this

20

chapter or other laws administered by the department.

21

(e.1)  Denial of permit.--The department may deny a permit

22

for any of the following reasons:

23

(1)  The well site for which a permit is requested is in

24

violation of any of this chapter or issuance of the permit

25

would result in a violation of this chapter or other

26

applicable law.

27

(2)  The permit application is incomplete.

28

(3)  Unresolved objections to the well location by coal

29

mine owner or operator remain.

30

(4)  The requirements of section 3225 (relating to

- 35 -

 


1

bonding) have not been met.

2

(5)  (i)  Either:

3

(A)  the department finds that the applicant, or

4

any parent or subsidiary corporation of the

5

applicant, is in continuing violation of this

6

subchapter, any other statute administered by the

7

department, any rule or regulation promulgated under

8

this subchapter or a statute administered by the

9

department or any plan approval, permit or order of

10

the department, unless the violation is being

11

corrected to the satisfaction of the department; or

12

(B)  the applicant, or any parent or subsidiary

13

corporation of the applicant, has shown a lack of

14

intention or ability to comply with the laws, rules,

15

regulations, approvals, permits or orders referred to

16

under clause (A).

17

(ii)  The right of the department to deny a permit

18

under subparagraph (i) shall not take effect until:

19

(A)  the department has taken a final action on

20

the violations;

21

(B)  (I)  the applicant has not appealed the

22

final action in accordance with the act of July

23

13, 1988 (P.L.530, No.94), known as the

24

Environmental Hearing Board Act; or

25

(II)  if an appeal has been filed, no

26

supersedeas has been issued.

27

(e.2)  Expedited review of applications.--

28

(1)  The department may provide expedited reviews of

29

applications within time frames specified by the department

30

to applicants for permits and other approvals if the

- 36 -

 


1

applicant pays an additional fee determined by the department

2

based upon any incremental costs to the department associated

3

with the review. The reviews may be performed by persons

4

selected by the department who are not Commonwealth employees

5

if the department is the entity that takes action on the

6

application or by county conservation districts under an

7

agreement with the department.

8

(2)  The permits and approvals may be those issued by the

9

department under this act and for activities associated with

10

oil and gas activities under the following:

11

(i)  The act of June 22, 1937 (P.L.1987, No.394),

12

known as The Clean Streams Law.

13

(ii)  The act of January 8, 1960 (1959 P.L.2119,

14

No.787), known as the Air Pollution Control Act.

15

(iii)  The act of November 26, 1978 (P.L.1375,

16

No.325), known as the Dam Safety and Encroachments Act.

17

(iv)  The act of July 7, 1980 (P.L.380, No.97), known

18

as the Solid Waste Management Act.

19

(v)  The act of May 1, 1984 (P.L.206, No.43), known

20

as the Pennsylvania Safe Drinking Water Act.

21

(vi)  The act of July 10, 1984 (P.L.688, No.147),

22

known as the Radiation Protection Act.

23

(vii)  The act of December 19, 1984 (P.L.1093,

24

No.219), known as the Noncoal Surface Mining Conservation

25

and Reclamation Act.

26

(viii)  The act of October 18, 1988 (P.L.756,

27

No.108), known as the Hazardous Sites Cleanup Act.

28

(ix)  The act of July 6, 1989 (P.L.169, No.32), known

29

as the Storage Tank and Spill Prevention Act.

30

(3)  The department may implement this subsection by

- 37 -

 


1

policy or by regulation promulgated by the Environmental

2

Quality Board.

3

(4)  The department shall consider relevant factors in

4

administering this section, including:

5

(i)  Legal requirements under applicable Federal and

6

State laws and regulations, including requirements for

7

public comment, and review by the Environmental

8

Protection Agency.

9

(ii)  Administrative completeness of applications.

10

(iii)  Adjustment of fees over time based on changes

11

in program costs.

12

(iv)  Applications submitted under seal by a

13

professional engineer, professional geologist or other

14

person licensed by the Department of State.

15

(v)  Actual or potential impacts to Federal and State

16

threatened and endangered species.

17

(5)  This subsection shall not apply to permits or

18

approvals for activities that may impact:

19

(i)  A water that is classified as high quality or

20

exceptional value under 25 Pa. Code Ch. 93 (relating to

21

water quality standards).

22

(ii)  Exceptional value wetlands as determined under

23

25 Pa. Code Ch. 105 (relating to dam safety and waterway

24

management).

25

(iii)  Public water supplies.

26

(6)  Fees collected under this subsection shall be

27

deposited into the fund for which fees are otherwise

28

deposited for the applicable permit or approval.

29

(f)  Drilling.--

30

(1)  Upon issuance of a permit, the well operator may

- 38 -

 


1

drill at the location shown on the plat after providing the

2

department, the surface landowner and the local political

3

subdivision in which the well is to be located 24 hours'

4

notice of the date that drilling will commence.

5

(2)  The unconventional well operator shall provide the

6

department 24 hours' notice prior to cementing all casing

7

strings, conducting pressure tests of the production casing,

8

stimulation and abandoning or plugging an unconventional

9

well.

10

(3)  In noncoal areas where more than one well is to be

11

drilled as part of the same development project, only the

12

first well of the project need be located by survey.

13

Remaining wells of the project shall be shown on the plat in

14

a manner prescribed by regulation.

15

(4)  Prior to drilling each additional project well, the

16

well operator shall notify the department and provide

17

reasonable notice of the date on which drilling will

18

commence.

19

(5)  Whenever, before or during the drilling of a well

20

not within the boundaries of an operating coal mine, the well

21

operator encounters conditions of a nature which renders

22

drilling of the bore hole or a portion thereof impossible, or

23

more hazardous than usual, the well operator, upon verbal

24

notice to the department, may immediately plug all or part of

25

the bore hole, if drilling has occurred, and commence a new

26

bore hole not more than 50 feet from the old bore hole if the

27

location of the new bore hole does not violate section 3215

28

(relating to well location restrictions) and, in the case of

29

a well subject to act of July 25, 1961 (P.L.825, No.359),

30

known as the Oil and Gas Conservation Law, if the new

- 39 -

 


1

location complies with existing laws, regulations and spacing

2

orders and the new bore hole is at least 330 feet from the

3

nearest lease boundary.

4

(6)  Within ten days of commencement of the new bore

5

hole, the well operator shall file with the department a

6

written notice of intention to plug, a well record, a

7

completion report, a plugging certificate for the original

8

bore hole and an amended plat for the new bore hole.

9

(7)  The well operator shall forward a copy of the

10

amended plat to the surface landowner identified on the well

11

permit application within ten days of commencement of the new

12

well bore.

13

(g)  Posting.--The well permit number and operator's name,

14

address and telephone number shall be conspicuously posted at

15

the drilling site prior to commencement of drilling.

16

(h)  Labeling.--The well operator shall install the permit

17

number issued by the department in a legible, visible and

18

permanent manner on the well upon completion.

19

(i)  Expiration.--Well permits issued for drilling wells

20

under this chapter shall expire one year after issuance unless

21

operations for drilling the well are commenced within the period

22

and pursued with due diligence or unless the permit is renewed

23

in accordance with regulations of the department. If drilling is

24

commenced during the one-year period, the well permit shall

25

remain in force until the well is plugged in accordance with

26

section 3220 (relating to plugging requirements) or the permit

27

is revoked. A drilling permit issued prior to April 18, 1985,

28

for a well which is an operating well on April 18, 1985, shall

29

remain in force as a well permit until the well is plugged in

30

accordance with section 3220. Nothing in this subsection shall

- 40 -

 


1

be construed to rescind the provisions pertaining to drilling

2

permits contained in Chapter 34.

3

(j)  Exceptions.--The Environmental Quality Board may

4

establish by regulation certain categories of alterations of

5

permitted or registered wells for which permitting requirements

6

of this section shall not apply. A well operator or owner who

7

proposes to conduct the alteration activity shall first obtain a

8

permit or registration modification from the department. The

9

Environmental Quality Board shall promulgate regulations as to

10

the requirements for modifications.

11

(k)  No transfer permitted.--No permit issued under this

12

section or registration issued under section 3213 (relating to

13

well registration and identification) may be transferred without

14

prior approval of the department. A request for approval of a

15

transfer shall be on the forms, and in the manner, prescribed by

16

the department. The department shall approve or deny a transfer

17

request within 45 days of receipt of a complete and accurate

18

application. The department may deny a request only for reasons

19

set forth in subsection (e.1)(4) and (5). Approval of a transfer

20

request shall permanently transfer responsibility to plug the

21

well under section 3220 to the recipient of the transferred

22

permit or registration.

23

(l)  Regulations.--The Environmental Quality Board may

24

establish by regulation requirements for the permitting and

25

operation of abandoned or orphan wells. A person who proposes to

26

conduct abandoned or orphan well operations shall first obtain a

27

permit to operate an abandoned or orphan well.

28

(m)  Water management.--The following shall apply to water

29

management:

30

(1)  No person may withdraw or use water from water

- 41 -

 


1

sources within this Commonwealth for the drilling or

2

hydraulic fracture stimulation of any natural gas well

3

completed in an unconventional gas formation, whether on or

4

off of the land where the gas well is located, except in

5

accordance with a water management plan approved by the

6

department.

7

(2)  The department shall review and approve water

8

management plans based upon a determination that the proposed

9

withdrawal, when operated in accordance with the proposed

10

withdrawal operating conditions set forth in the plan,

11

including conditions relating to quantity, withdrawal rate

12

and timing and any passby flow conditions, will:

13

(i)  not adversely affect the quantity or quality of

14

water available to other users of the same water sources;

15

(ii)  protect and maintain the designated and

16

existing uses of water sources; and

17

(iii)  not cause adverse impact to water quality in

18

the watershed considered as a whole.

19

(3)  (i)  The criteria under paragraph (2) shall be

20

presumed to be achieved if the proposed water withdrawal

21

has been approved by and is operated in accordance with

22

conditions established by the Susquehanna River Basin

23

Commission, the Delaware River Basin Commission or the

24

Great Lakes Commission, as applicable.

25

(ii)  Notwithstanding subparagraph (i), the

26

department may establish additional requirements as

27

necessary to comply with the laws of this Commonwealth.

28

(4)  In addition to the requirements under paragraphs

29

(1), (2) and (3), compliance with a department-approved water

30

management plan shall be a condition of any permit issued

- 42 -

 


1

under this chapter for the drilling or hydraulic fracture

2

stimulation of any natural gas well completed in an

3

unconventional formation and shall be deemed to satisfy the

4

laws of this Commonwealth.

5

§ 3212.  Permit objections.

6

(a)  General rule.--If a well referred to in section 3211(b)

7

(relating to well permits) will be located on a tract whose

8

surface is owned by a person other than the well operator, the

9

surface landowner affected shall be notified of the intent to

10

drill and may file objections, in accordance with section 3251

11

(relating to conferences), based on the assertion that the well

12

location violates section 3215 (relating to well location

13

restrictions) or that information in the application is untrue

14

in any material respect, within 15 days of the receipt by the

15

surface owner of the plat under section 3211(b). Receipt of

16

notice by the surface owner shall be presumed to have occurred

17

15 days from the date of the certified mailing when the well

18

operator submits a copy of the certified mail receipt sent to

19

the surface owner and an affidavit certifying that the address

20

of the surface owner to which notice was sent is the same as the

21

address listed in the assessment books in the county where the

22

property is located. If no objection is filed or none is raised

23

by the department within 15 days after receipt of the plat by

24

the surface landowner, or, if written approval by the surface

25

landowner is filed with the department and no objection is

26

raised by the department within 15 days of filing, the

27

department shall proceed to issue or deny the permit.

28

(b)  Special circumstances.--If a well referred to in section

29

3211(b) will penetrate within the outside coal boundaries of an

30

operating coal mine or a coal mine already projected and platted

- 43 -

 


1

but not yet being operated, or within 1,000 linear feet beyond

2

those boundaries, and, in the opinion of the coal owner or

3

operator, the well or a pillar of coal about the well will

4

unduly interfere with or endanger the mine, the coal owner or

5

operator affected may file objections under section 3251 to the

6

proposed location within 15 days of the receipt by the coal

7

operator of the plat under section 3211(b). If possible, an

8

alternative location at which the proposed well could be drilled

9

to overcome the objections shall be indicated. If no objection

10

to the proposed location is filed or if none is raised by the

11

department within 15 days after receipt of the plat by the coal

12

operator or owner, or, if written approval by the coal operator

13

or owner of the location is filed with the department and no

14

objection is raised by the department within 15 days of filing,

15

the department shall proceed to issue or deny the permit.

16

(c)  Procedure upon objection.--If an objection is filed by a

17

coal operator or owner or made by the department, the department

18

shall fix a time and place for a conference under section 3251

19

not more than ten days from the date of service of the objection

20

to allow the parties to consider the objection and attempt to

21

agree on a location. If they fail to agree, the department, by

22

an appropriate order, shall determine a location on the tract of

23

land as near to the original location as possible where, in the

24

judgment of the department, the well can be safely drilled

25

without unduly interfering with or endangering the mine as

26

defined in subsection (b). The new location agreed upon by the

27

parties or determined by the department shall be indicated on

28

the plat on file with the department and become a permanent

29

record upon which the department shall proceed to issue or deny

30

the permit.

- 44 -

 


1

(d)  Survey.--Within 120 days after commencement of drilling

2

operations, the coal operator shall accurately locate the well

3

by a closed survey on the same datum as the mine workings or

4

coal boundaries are mapped, file the results of the survey with

5

the department and forward a copy by certified mail to the well

6

operator.

7

§ 3212.1.  Comments by municipalities.

8

(a)  General rule.--The municipality where the tract of land

9

upon which the unconventional well to be drilled is located may

10

submit written comments to the department describing local

11

conditions or circumstances which the municipality has

12

determined should be considered by the department in rendering

13

its determination on the unconventional well permit. A comment

14

under this subsection must be submitted to the department within

15

15 days of the receipt of the plat under section 3211(b)

16

(relating to well permits). The municipality shall

17

simultaneously forward a copy of its comments to the permit

18

applicant and all other parties entitled to a copy of the plat

19

under section 3211(b), who may submit a written response. A

20

written response must be submitted to the department within ten

21

days of receipt of the comments of the municipality.

22

(b)  Consideration by department.--Comments and responses

23

under subsection (a) may be considered by the department in

24

accordance with section 3215(d) (relating to well location

25

restrictions).

26

(c)  No extension of time period.--The process outlined in

27

this section shall not extend the time period for the issuance

28

or denial of a permit beyond the time period set forth in this

29

chapter.

30

§ 3213.  Well registration and identification.

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1

(a)  General rule.--On or before July 5, 1996, each person

2

who owned or operated a well in existence prior to April 18,

3

1985, which has not been registered with the department and for

4

which no drilling permit has been issued by the department,

5

shall register the well with the department. A well owner or

6

operator who registers under this subsection and a well owner or

7

operator who has previously registered a well under this chapter

8

shall, on or before July 5, 1996, identify any abandoned well on

9

property which the well owner or operator owns or leases and

10

request approval from the department for classification of the

11

well as an orphan well. Information regarding wells to be

12

registered or identified shall be provided on a form, or in a

13

manner, prescribed by the department, and shall include:

14

(1)  The name and address of the well operator and, if

15

the well operator is a corporation, partnership or person

16

nonresident of this Commonwealth, the name and address of an

17

agent for the operator upon whom notices, orders, process or

18

other communications issued under this chapter may be served.

19

(2)  The well name and the location of the well indicated

20

by a point on a 7 1/2 minute United States Geological Survey

21

topographic map or any other location description sufficient

22

to enable the department to locate the well on the ground.

23

(3)  The approximate date of drilling and completing the

24

well, its approximate depth and producing horizons, well

25

construction information and, if available, driller's logs.

26

(4)  An indemnity bond, an alternative fee in lieu of

27

bonding or other evidence of financial security submitted by

28

the well operator and deemed appropriate by the department

29

and satisfying the requirements of section 3225 (relating to

30

bonding). No bond, alternative fee or other evidence of

- 46 -

 


1

financial security shall be required for identification of an

2

orphan well. For wells drilled prior to January 30, 1956,

3

which have not been bonded, the well operator shall have five

4

years to comply with the provisions of this paragraph.

5

(5)  A registration fee of $15 per well or blanket

6

registration fee of $250 for multiple well registration

7

applications submitted simultaneously. The registration fee

8

shall be waived until July 5, 1996, and no fee shall be

9

charged for identification of an orphan well.

10

(a.1)  Orphan wells.--After July 5, 1996, a well owner, well

11

operator or other person discovering an abandoned well on

12

property purchased or leased by the well owner, well operator or

13

other person shall identify it to the department within 60 days

14

of discovery and advise the department that he is seeking

15

classification of the well as an orphan well. No fee shall be

16

required for identification.

17

(b)  Extension.--The department may extend the one-year time

18

period under subsection (a) for good cause shown. The extension

19

may not exceed a period ending two years from April 18, 1985.

20

The department may adopt and promulgate guidelines designed to

21

ensure a fair implementation of this section, recognizing the

22

practical difficulties of locating unpermitted wells and

23

complying with the reporting requirements of this chapter.

24

(c)  Installation of registration number.--The well operator

25

shall install the registration number issued by the department

26

in a legible, conspicuous and permanent manner on the well

27

within 60 days of issuance.

28

(d)  Definition.--For purposes of subsection (a)(4) and (5),

29

the term "owner" does not include an owner or possessor of

30

surface real property, on which an abandoned well is located,

- 47 -

 


1

who did not participate or incur costs in, and had no right of

2

control over, the drilling or extraction operation of the

3

abandoned well.

4

§ 3214.  Inactive status.

5

(a)  General rule.--Upon application, the department shall

6

grant inactive status for a period of five years for a permitted

7

or registered well, if the following requirements are met:

8

(1)  the condition of the well is sufficient to prevent

9

damage to the producing zone or contamination of fresh water

10

or other natural resources or surface leakage of any

11

substance;

12

(2)  the condition of the well is sufficient to stop the

13

vertical flow of fluids or gas within the well bore and is

14

adequate to protect freshwater aquifers, unless the

15

department determines the well poses a threat to the health

16

and safety of persons or property or to the environment;

17

(3)  the operator anticipates construction of a pipeline

18

or future use of the well for primary or enhanced recovery,

19

gas storage, approved disposal or other appropriate uses

20

related to oil and gas well production; and

21

(4)  the applicant satisfies the bonding requirements of

22

sections 3213 (relating to well registration and

23

identification) and 3225 (relating to bonding), except that

24

the department may require additional financial security for

25

a well on which an alternative fee is being paid in lieu of

26

bonding under section 3225(d).

27

(b)  Monitoring.--The owner or operator of a well granted

28

inactive status shall be responsible for monitoring the

29

mechanical integrity of the well to ensure that the requirements

30

of subsection (a)(1) and (2) are met and shall report the same

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1

on an annual basis to the department in the manner and form

2

prescribed by departmental regulations.

3

(c)  (Reserved).

4

(d)  Return to active status.--A well granted inactive status

5

under subsection (a) shall be plugged in accordance with section

6

3220 (relating to plugging requirements) or returned to active

7

status within five years of the date inactive status was

8

granted, unless the owner or operator applies for an extension

9

of inactive status which may be granted on a year-to-year basis

10

if the department determines that the owner or operator has

11

demonstrated ability to continue meeting the requirements of

12

this section and the owner or operator certifies that the well

13

will be of future use within a reasonable period of time. An

14

owner or operator who has been granted inactive status for a

15

well which is returned to active status prior to expiration of

16

the five-year period set forth in subsection (a) shall notify

17

the department that the well has been returned to active status

18

and shall not be permitted to apply for another automatic five-

19

year period of inactive status for the well. The owner or

20

operator may make application to return the well to inactive

21

status, and the application may be approved on a year-to-year

22

basis if the department determines that the owner or operator

23

has demonstrated an ability to continue meeting the requirements

24

of this section and the owner or operator certifies that the

25

well will be of future use within a reasonable period of time.

26

The department shall approve or deny an application to extend a

27

period of inactive status or to return a well to inactive status

28

within 60 days of receipt of the application, and the

29

application shall not be unreasonably denied. If the department

30

has not completed its review of the application within 60 days,

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1

the inactive status shall continue until the department has made

2

a determination on the request. If the department denies an

3

application to extend the period of inactive status or to return

4

a well to inactive status, a well owner or operator aggrieved by

5

the denial shall have the right to appeal the denial to the

6

Environmental Hearing Board within 30 days of receipt of the

7

denial. Upon cause shown by a well owner or operator, the board

8

may grant a supersedeas under section 4 of the act of July 13,

9

1988 (P.L.530, No.94), known as the Environmental Hearing Board

10

Act, so that the well in question may retain inactive status

11

during the period of the appeal.

12

(e)  Revocation of inactive status.--The department may

13

revoke inactive status and order immediate plugging of a well if

14

the well is in violation of this chapter or rules or regulations

15

promulgated under this chapter or if the owner or operator

16

demonstrates inability to perform obligations under this chapter

17

or becomes financially insolvent, or upon receipt by the

18

department of notice of bankruptcy proceedings by the permittee.

19

§ 3215.  Well location restrictions.

20

(a)  General rule.--Wells may not be drilled within 200 feet,

21

or, in the case of an unconventional well, 500 feet measured

22

horizontally from any existing building or existing water well

23

without written consent of the owner of the building or water

24

well. Unconventional wells may not be drilled within 1,000 feet

25

measured horizontally from any existing water well, surface

26

water intake, reservoir or other source used by a water

27

purveyor. If the distance restriction would deprive the owner of

28

the oil and gas rights of the right to produce or share in the

29

oil or gas underlying the surface tract, the well operator may

30

be granted a variance from the distance restriction upon

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1

submission of a plan identifying the additional measures,

2

facilities or practices to be employed during well site

3

construction, drilling and operations. The variance, if granted,

4

shall include additional terms and conditions required by the

5

department to ensure safety and protection of affected persons

6

and property, including insurance, bonding, indemnification and

7

technical requirements.

8

(b)  Limitation.--No well site may be prepared or well

9

drilled within 100 feet, or, in the case of an unconventional

10

well, 300 feet measured horizontally from a stream, spring or

11

body of water as identified on the most current 7 1/2 minute

12

topographic quadrangle map of the United States Geological

13

Survey or within 100 feet, or, in the case of an unconventional

14

well, 300 feet of any wetlands greater than one acre in size.

15

The department may waive the distance restrictions upon

16

submission of a plan identifying additional measures, facilities

17

or practices to be employed during well site construction,

18

drilling and operations. The waiver, if granted, shall impose

19

permit conditions necessary to protect the waters of the

20

Commonwealth.

21

(c)  Impact.--On making a determination on a well permit, the

22

department shall consider impact of the proposed well on public

23

resources, including, but not limited to:

24

(1)  Publicly owned parks, forests, game lands and

25

wildlife areas.

26

(2)  National or State scenic rivers.

27

(3)  National natural landmarks.

28

(4)  Habitats of rare and endangered flora and fauna and

29

other critical communities.

30

(5)  Historical and archaeological sites listed on the

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1

Federal or State list of historic places.

2

(d)  Consideration of municipality comments.--The department

3

may consider the comments submitted under section 3212.1

4

(relating to comments by municipalities) in making a

5

determination on a well permit. Notwithstanding any other law,

6

no municipality shall have a right of appeal or other form of

7

review from the department's decision.

8

(e)  Public resources impact criteria.--The Environmental

9

Quality Board may develop by regulation criteria for the

10

department to utilize for conditioning a well permit based on

11

its impact to the public resources identified under subsection

12

(c).

13

(f)  Floodplains.--

14

(1)  No well site may be prepared or well drilled within

15

any floodplain if the well site will have:

16

(i)  a pit or impoundment containing drilling

17

cuttings, flowback water, produced water or hazardous

18

materials, chemicals or wastes within the floodplain; or

19

(ii)  a tank containing hazardous materials,

20

chemicals, condensate, wastes, flowback or produced water

21

within the floodway.

22

(2)  A well site shall not be eligible for a floodplain

23

restriction waiver if the well site will have a tank

24

containing condensate, flowback or produced water within the

25

flood fringe unless all the tanks have adequate floodproofing

26

in accordance with the National Flood Insurance Program

27

standards and accepted engineering practices.

28

(3)  The department may waive restrictions upon

29

submission of a plan that shall identify the additional

30

measures, facilities or practices to be employed during well

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1

site construction, drilling and operations. The waiver, if

2

granted, shall impose permit conditions necessary to protect

3

the waters of this Commonwealth.

4

(4)  Best practices to ensure the protection of the

5

waters of this Commonwealth must be utilized for the storage

6

and handling of all water, chemicals, fuels, hazardous

7

materials or solid waste on a well site located in a

8

floodplain. The department may request that the well site

9

operator submit a plan for the storage and handling of

10

materials for approval by the department and may impose

11

conditions or amend permits to include permit conditions as

12

are necessary to protect the environment, public health and

13

safety.

14

(5)  Unless otherwise specified by the department, the

15

boundary of the floodplain shall be as indicated on maps and

16

flood insurance studies provided by the Federal Emergency

17

Management Agency. In an area where no Federal Emergency

18

Management Agency maps or studies have defined the boundary

19

of the 100-year frequency floodplain, absent evidence to the

20

contrary, the floodplain shall extend from:

21

(i)  any perennial stream up to 100 feet horizontally

22

from the top of the bank of the perennial stream; or

23

(ii)  from any intermittent stream up to 50 feet

24

horizontally from the top of the bank of the intermittent

25

stream.

26

§ 3215.1.  General restrictions.

27

(a)  Security fencing.--Security fencing shall be installed

28

at the oil or gas well site to secure all permanent buildings,

29

facilities, structures and equipment at the site and to protect

30

the public. Warning signs shall be placed on the security

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1

fencing providing notice of potential dangers and providing

2

contact information in case of an emergency.

3

(b)  Temporary operations.--The following shall apply to

4

temporary operations:

5

(1)  Except as provided under subsection (a) and

6

paragraph (2), temporary security fencing shall be installed

7

at the oil or gas well site to secure all buildings,

8

facilities, structures and equipment at the site and to

9

protect the public. Warning signs shall be placed at the well

10

site providing notice of potential dangers and providing

11

contact information in case of an emergency.

12

(2)  In lieu of security fencing under paragraph (1), a

13

well owner or operator may establish a guard station with 24

14

hour staffing at the entrance of the site to prevent

15

unauthorized access.

16

(c)  Lighting.--Lighting at the well site and at other

17

buildings, facilities and structures directly related to oil and

18

gas operations, either temporary or permanent, shall be directed

19

downward and inward toward the activity, to the extent

20

practicable, so as to minimize the glare on public roads and

21

nearby buildings within 100 feet of the well site, building,

22

facility or structure.

23

(d)  Noise regulations.--Well owners and operators shall

24

comply with all applicable noise regulations promulgated by the

25

Federal Energy Regulatory Commission, except that the noise

26

level from permanent oil and gas operations may not exceed 60

27

dBA at the nearest property line of the tract of land upon which

28

oil and gas operations are being conducted.

29

(e)  Atmospheric discharge.--Well owners and operators shall

30

comply with each applicable environmental law governing the

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1

discharge of gases, vapors and odors into the atmosphere. The

2

discharge of gases, vapors and odors during oil and gas

3

operations may not unreasonably interfere with the comfortable

4

enjoyment of life or property.

5

§ 3216.  Well site restoration.

6

(a)  General rule.--Each oil or gas well owner or operator

7

shall restore the land surface within the area disturbed in

8

siting, drilling, completing and producing the well.

9

(b)  Plan.--During and after earthmoving or soil disturbing

10

activities, including, but not limited to, activities related to

11

siting, drilling, completing, producing and plugging the well,

12

erosion and sedimentation control measures shall be implemented

13

in accordance with an erosion and sedimentation control plan

14

prepared in accordance with the act of June 22, 1937 (P.L.1987,

15

No.394), known as The Clean Streams Law.

16

(c)  Pits, drilling supplies and equipment.--Within nine

17

months after completion of drilling of a well, the owner or

18

operator shall restore the well site, remove or fill all pits

19

used to contain produced fluids or industrial wastes and remove

20

all drilling supplies and equipment not needed for production.

21

Drilling supplies and equipment not needed for production may be

22

stored on the well site if express written consent of the

23

surface landowner is obtained.

24

(d)  Items related to production or storage.--Within nine

25

months after plugging a well, the owner or operator shall remove

26

all production or storage facilities, supplies and equipment and

27

restore the well site.

28

(e)  Clean Streams Law.--Restoration activities required by

29

this chapter or in regulations promulgated under this chapter

30

shall also comply with all applicable provisions of The Clean

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1

Streams Law.

2

(f)  Violation of chapter.--Failure to restore the well site

3

as required in this chapter or regulations promulgated under

4

this chapter constitutes a violation of this chapter.

5

(g)  Extension.--

6

(1)  The restoration period may be extended by the

7

department for an additional period of time not to exceed two

8

years upon demonstration by the well owner or operator that:

9

(i)  the extension will result in less earth

10

disturbance, increased water reuse or more efficient

11

development of the resources; or

12

(ii)  site restoration cannot be achieved due to

13

adverse weather conditions or a lack of essential fuel,

14

equipment or labor.

15

(2)  The demonstration under paragraph (1) shall do all

16

of the following:

17

(i)  Include a site restoration plan that shall

18

provide for:

19

(A)  the timely removal or fill of all pits used

20

to contain produced fluids or industrial wastes;

21

(B)  the removal of all drilling supplies and

22

equipment not needed for production;

23

(C)  the stabilization of the well site that

24

shall include interim postconstruction storm water

25

management best management practices; or

26

(D)  other measures to be employed to minimize

27

accelerated erosion and sedimentation in accordance

28

with The Clean Streams Law.

29

(ii)  Provide for returning the portions of the site

30

not occupied by production facilities or equipment to

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1

approximate original contours and making them capable of

2

supporting the uses that existed prior to drilling the

3

well.

4

(3)  The department may condition an extension under this

5

subsection as is necessary in accordance with The Clean

6

Streams Law.

7

§ 3217.  Protection of fresh groundwater and casing

8

requirements.

9

(a)  General rule.--To aid in protection of fresh

10

groundwater, well operators shall control and dispose of brines

11

produced from the drilling, alteration or operation of an oil or

12

gas well in a manner consistent with the act of June 22, 1937

13

(P.L.1987, No.394), known as The Clean Streams Law, or any rule

14

or regulation promulgated under The Clean Streams Law.

15

(b)  Casing.--To prevent migration of gas or fluids into

16

sources of fresh groundwater and pollution or diminution of

17

fresh groundwater, a string or strings of casing shall be run

18

and permanently cemented in each well drilled through the fresh

19

water-bearing strata to a depth and in a manner prescribed by

20

regulation by the department.

21

(c)  Procedure when coal has been removed.--If a well is

22

drilled at a location where coal has been removed from one or

23

more coal seams, the well shall be drilled and cased to prevent

24

migration of gas or fluids into the seam from which coal has

25

been removed in a manner prescribed by regulation of the

26

department. The department and the coal operator, owner or

27

lessee shall be given at least 72 hours' notice prior to

28

commencement of work protecting the mine.

29

(d)  Procedure when coal has not been removed.--If a well is

30

drilled at a location where the coal seam has not been removed,

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1

the well shall be drilled to a depth and of a size sufficient to

2

permit placement of casing, packers in and vents on the hole at

3

the points and in the manner prescribed by regulation to exclude

4

gas or fluids from the coal seam, except gas or fluids found

5

naturally in the seam itself, and to enable monitoring the

6

integrity of the production casing.

7

§ 3218.  Protection of water supplies.

8

(a)  General rule.--A well operator who affects a public or

9

private water supply by pollution or diminution shall restore or

10

replace the affected supply with an alternate source of water

11

adequate in quantity or quality for the purposes served by the

12

supply.

13

(b)  Pollution or diminution of water supply.--A landowner or

14

water purveyor suffering pollution or diminution of a water

15

supply as a result of the drilling, alteration or operation of

16

an oil or gas well may so notify the department and request that

17

an investigation be conducted. Within ten days of notification,

18

the department shall investigate the claim and make a

19

determination within 45 days following notification. If the

20

department finds that the pollution or diminution was caused by

21

drilling, alteration or operation activities or if it presumes

22

the well operator responsible for pollution under subsection

23

(c), the department shall issue orders to the well operator

24

necessary to assure compliance with subsection (a), including

25

orders requiring temporary replacement of a water supply where

26

it is determined that pollution or diminution may be of limited

27

duration.

28

(c)  Presumption.--Unless rebutted by a defense established

29

in subsection (d), it shall be presumed that a well operator is

30

responsible for pollution of a water supply if:

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1

(1)  except as set forth in paragraph (2):

2

(i)  the water supply is within 1,000 feet of an oil

3

or gas well; and

4

(ii)  the pollution occurred within six months after

5

completion of drilling or alteration of the oil or gas

6

well; or

7

(2)  in the case of an unconventional well:

8

(i)  the water supply is within 2,500 feet of the

9

unconventional well; and

10

(ii)  the pollution occurred within 12 months of the

11

later of completion, drilling or alteration of the

12

unconventional well.

13

(d)  Defenses.--To rebut the presumption established under

14

subsection (c), a well operator must affirmatively prove any of

15

the following:

16

(1)  The pollution existed prior to the drilling or

17

alteration activity as determined by a predrilling or

18

prealteration survey.

19

(2)  The landowner or water purveyor refused to allow the

20

operator access to conduct a predrilling or prealteration

21

survey.

22

(3)  The water supply is not within 1,000 feet of the

23

well.

24

(4)  The pollution occurred more than six months after

25

completion of drilling or alteration activities.

26

(5)  The pollution occurred as the result of a cause

27

other than the drilling or alteration activity.

28

(e)  Independent certified laboratory.--An operator electing

29

to preserve a defense under subsection (d)(1) or (2) shall

30

retain an independent certified laboratory to conduct a

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1

predrilling or prealteration survey of the water supply. A copy

2

of survey results shall be submitted to the department and the

3

landowner or water purveyor in the manner prescribed by the

4

department.

5

(f)  Other remedies preserved.--Nothing in this section shall

6

prevent a landowner or water purveyor claiming pollution or

7

diminution of a water supply from seeking any other remedy at

8

law or in equity.

9

§ 3219.  Use of safety devices.

10

Any person engaged in drilling an oil or gas well shall equip

11

it with casings of sufficient strength, and other safety devices

12

as are necessary, in the manner prescribed by regulation of the

13

department, and shall use every effort and endeavor effectively

14

to prevent blowouts, explosions and fires.

15

§ 3219.1.  Well control emergency response.

16

(a)  Contracts.--The department may enter into contracts with

17

well control specialists in order to provide adequate emergency

18

response services in the event of a well control emergency.

19

(b)  Civil immunity.--Except as set forth in subsection (c),

20

a well control specialist with which the department has entered

21

into a contract under subsection (a) shall be immune from civil

22

liability for actions taken in good faith to carry out its

23

contractual obligations.

24

(c)  Nonapplicability.--Subsection (b) shall not apply to

25

damage arising from any of the following:

26

(1)  Breach of the contract under subsection (a).

27

(2)  An intentional tort.

28

(3)  Gross negligence.

29

§ 3220.  Plugging requirements.

30

(a)  General rule.--Upon abandoning a well, the owner or

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1

operator shall plug it in the manner prescribed by regulation of

2

the department to stop vertical flow of fluids or gas within the

3

well bore, unless the department has granted inactive status for

4

the well or it has been approved by the department as an orphan

5

well. If the department determines that a prior owner or

6

operator received economic benefit, other than economic benefit

7

derived only as a landowner or from a royalty interest, after

8

April 18, 1979, from an orphan well or an unregistered well, the

9

owner or operator shall be responsible for plugging the well. In

10

the case of a gas well penetrating a workable coal seam which

11

was drilled prior to January 30, 1956, or which was permitted

12

after that date but not plugged in accordance with this chapter,

13

if the owner or operator or a coal operator or an agent proposes

14

to plug the well to allow mining through it, the gas well shall

15

be cleaned to a depth of at least 200 feet below the coal seam

16

through which mining is proposed and, unless impracticable, to a

17

point 200 feet below the deepest mineable coal seam. The gas

18

well shall be plugged from that depth in accordance with section

19

13 of the act of December 18, 1984 (P.L.1069, No.214), known as

20

the Coal and Gas Resource Coordination Act, and the regulations

21

of the department.

22

(b)  Areas underlain by coal.--Prior to the plugging and

23

abandonment of a well in an area underlain by a workable coal

24

seam, the well operator or owner shall notify the department and

25

the coal operator, lessee or owner and submit a plat, on a form

26

to be furnished by the department, showing the location of the

27

well and fixing the date and time plugging will commence, which

28

shall be not less than three working days, nor more than 30

29

days, after the notice is received, to permit representatives of

30

the persons notified to be present at the plugging. Notice and

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1

the right to be present may be waived by the department and the

2

coal operator, lessee or owner, but waiver by the coal operator,

3

lessee or owner shall be in writing and a copy shall be attached

4

to the notice of abandonment filed with the department under

5

this section. Whether or not representatives attend, if the well

6

operator has fully complied with this section, the well operator

7

may proceed, at the time fixed, to plug the well in the manner

8

prescribed by regulation of the department. When plugging has

9

been completed, a certificate shall be prepared and signed, on a

10

form to be furnished by the department, by two experienced and

11

qualified people who participated in the work setting forth the

12

time and manner in which the well was plugged. One copy of the

13

certificate shall be mailed to each coal operator, lessee or

14

owner to whom notice was given by certified mail and another

15

shall be mailed to the department.

16

(c)  Abandoned wells.--Prior to abandonment of a well, except

17

an uncompleted bore hole plugged immediately upon suspension of

18

drilling in an area not underlain by a workable coal seam, the

19

well operator shall notify the department of the intention to

20

plug and abandon the well and submit a plat, on a form to be

21

furnished by the department, showing the location of the well

22

and fixing the date and time at which plugging will commence,

23

which shall be not less than three working days, nor more than

24

30 days, after the notice is received, to permit a department

25

representative to be present at the plugging. The notice or

26

waiting period may be verbally waived by the department. In

27

noncoal areas where more than one well has been drilled as part

28

of the same development project and the wells are now to be

29

plugged, the department shall be given three working days'

30

notice prior to plugging the first well of the project, subject

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1

to waiver of notice described in subsection (b). In the plugging

2

of subsequent wells, no additional notice shall be required if

3

plugging on the project is continuous. If plugging of subsequent

4

wells is delayed for any reason, notice shall be given to the

5

department of continuation of the project. Whether or not a

6

representative attends, if the well operator has fully complied

7

with this section, the well operator may proceed, at the time

8

fixed, to plug the well in the manner prescribed by regulation

9

of the department. When plugging has been completed, a

10

certificate shall be prepared, on a form to be furnished by the

11

department, by two experienced and qualified people who

12

participated in the work setting forth the time and manner in

13

which the well was plugged. A copy of the certificate shall be

14

mailed to the department.

15

(d)  Wells abandoned upon completion of drilling.--If a well

16

is to be abandoned immediately after completion of drilling, the

17

well operator shall give at least 24 hours' notice by telephone,

18

confirmed by certified mail, to the department and to the coal

19

operator, lessee or owner, if any, fixing the date and time when

20

plugging will commence. Notice and the right to be present may

21

be waived by the department and the coal operator, lessee or

22

owner, if any. Whether or not representatives of the department

23

or coal operator, lessee or owner, if any, attend, if the well

24

operator has fully complied with the requirements of this

25

section, the well operator may proceed, at the time fixed, to

26

plug the well in the manner provided by regulation of the

27

department. The well operator shall prepare the certificate of

28

plugging and mail copies of the same as provided in subsection

29

(b).

30

(e)  Orphan wells.--If a well is an orphan well or abandoned

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1

without plugging, or if a well is in operation but not

2

registered under section 3213 (relating to well registration and

3

identification), the department may enter upon the well site and

4

plug the well and to sell equipment, casing and pipe at the site

5

which may have been used in production of the well in order to

6

recover the costs of plugging. The department shall make an

7

effort to determine ownership of a well which is in operation

8

but has not been registered and provide written notice to the

9

owner of pending action under this subsection. If the department

10

cannot determine ownership within 30 days, it may proceed under

11

this subsection. Costs of plugging shall have priority over all

12

liens on equipment, casing and pipe, and the sale shall be free

13

and clear of those liens to the extent that the cost of plugging

14

exceeds the sale price. If the amount obtained for casing and

15

pipe salvaged at the site is inadequate to pay for plugging, the

16

owner or operator of the abandoned or unregistered well shall be

17

liable for the additional costs.

18

(f)  Definition.--For purposes of this section, the term

19

"owner" does not include the owner or possessor of surface real

20

property, on which an abandoned well is located, who did not

21

participate or incur costs in and had no right of control over

22

the drilling or extraction operation of the abandoned well.

23

§ 3221.  Alternative methods.

24

A well operator may request permission to use a method or

25

material other than those required by this chapter for casing,

26

plugging or equipping a well in an application to the department

27

which describes the proposed alternative in reasonable detail

28

and indicates the manner in which it will accomplish the goals

29

of this chapter. Notice of filing of the application shall be

30

given by the well operator by certified mail to any affected

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1

coal operators, who may, within 15 days after the notice, file

2

objections to the proposed alternative method or material. If no

3

timely objections are filed or raised by the department, the

4

department shall determine whether to allow use of the proposed

5

alternative method or material.

6

§ 3222.  Well reporting requirements.

7

(a)  General rule.--Except as provided in subsection (a.1),  

8

each well operator shall file with the department, on a form

9

provided by the department, an annual report specifying the

10

amount of production, on the most well-specific basis available,

11

along with the status of each well, except that in subsequent

12

years only changes in status must be reported. The Commonwealth

13

may utilize reported information in enforcement proceedings, in

14

making designations or determinations under section 1927-A of

15

the act of April 9, 1929 (P.L.177, No.175), known as The

16

Administrative Code of 1929, or in aggregate form for

17

statistical purposes.

18

(a.1)  Marcellus Shale formation wells.--Each operator of an

19

unconventional well shall file with the department, on a form

20

provided by the department, a semiannual report specifying the

21

amount of production on the most well-specific basis available.

22

The initial report under this subsection shall be filed on or

23

before August 15, 2010, and shall include production data from

24

the preceding calendar year and specify the status of each well.

25

In subsequent reports, only changes in status must be reported.

26

Subsequent semiannual reports shall be filed with the department

27

on or before February 15 and August 15 of each year and shall

28

include production data from the preceding reporting period. The

29

Commonwealth may utilize reported information in enforcement

30

proceedings, in making designations or determinations under

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1

section 1927-A of The Administrative Code of 1929 or in

2

aggregate form for statistical purposes. Beginning November 1,

3

2010, the department shall make the reports available on its

4

publicly accessible Internet website. Costs incurred by the

5

department to comply with the requirements of this subsection

6

shall be paid out of the fees collected under section 3211(d)

7

(relating to well permits).

8

(b)  Collection of data.--

9

(1)  Well operators shall maintain a record of each well

10

drilled or altered.

11

(2)  A record containing the information required by the

12

department shall be filed within 30 days of cessation of

13

drilling of each well.

14

(3)  A completion report containing any additional

15

required information shall be filed within 30 days after

16

completing the well and shall be kept on file by the

17

department.

18

(4)  (i)  The completion report shall include a

19

stimulation record. At a minimum, the stimulation record

20

shall contain pump rates, pressures, total volume used to

21

stimulate the well, a list of hazardous and other

22

chemicals used to stimulate the well, volume of water

23

used, identification of water sources used under a

24

department-approved water management plan and depth at

25

which potable aquifers are encountered during drilling.

26

The well operator may designate specific portions of the

27

stimulation record as containing a trade secret or

28

confidential proprietary information. The department

29

shall prevent disclosure of designated confidential

30

information to the extent permitted under the act of

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1

February 14, 2008 (P.L.6, No.3), known as the Right-to-

2

Know Law.

3

(ii)  The completion report shall identify:

4

(A)  whether methane was encountered in other

5

than a target formation; and

6

(B)  the country of origin and manufacture of the

7

steel products used in the construction of the well.

8

(iii)  The completion report shall be kept on file by

9

the department and posted on the department's publicly

10

accessible Internet website.

11

(5)  Upon request of the department, the well operator

12

shall, within 90 days of completion or recompletion of

13

drilling, submit a copy of any electrical, radioactive or

14

other standard industry logs which have been run. No

15

information under this paragraph shall be required unless the

16

well operator has compiled the information in the ordinary

17

course of business.

18

(6)  Upon request by the department within one year, the

19

well operator shall file a copy of drill stem test charts,

20

formation water analysis, porosity, permeability or fluid

21

saturation measurements, core analysis and lithologic log or

22

sample description or other similar data as compiled. No

23

information under this paragraph shall be required unless the

24

well operator had it compiled in the ordinary course of

25

business, and interpretation of data under this paragraph is

26

not required to be filed.

27

(c)  Drill cuttings and core samples.--Upon notification by

28

the department prior to commencement of drilling, the well

29

operator shall collect any additional data specified by the

30

department, including representative drill cuttings and samples

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1

from cores taken and any other geological information that the

2

operator reasonably can compile. Interpretation of the data is

3

not required to be filed.

4

(d)  Retention and filing of data.--Data required under

5

subsection (b) and drill cuttings required under subsection (c)

6

shall be retained by the well operator and filed with the

7

department no more than three years after completion of the

8

well. Upon request, the department shall extend the deadline up

9

to five years from the date of completion of the well. The

10

department shall be entitled to utilize information collected

11

under this subsection in enforcement proceedings, in making

12

designations or determinations under section 1927-A of The

13

Administrative Code of 1929 and in aggregate form for

14

statistical purposes.

15

§ 3223.  Notification and effect of well transfer.

16

The owner or operator of a well shall notify the department

17

in writing within 30 days, in a form directed by regulation, of

18

sale, assignment, transfer, conveyance or exchange by or to the

19

owner of the well. A transfer shall not relieve the well owner

20

or operator of an obligation accrued under this chapter, nor

21

shall it relieve the owner or operator of an obligation to plug

22

the well until the requirements of section 3225 (relating to

23

bonding) have been met, at which time the transferring owner or

24

operator shall be relieved from all obligations under this

25

chapter, including the obligation to plug the well.

26

§ 3224.  Coal operator responsibilities.

27

(a)  General rule.--At any time prior to removing coal or

28

other underground materials from, or extending the workings in,

29

a coal mine within 500 feet of an oil or gas well of which the

30

coal operator has knowledge, or within 500 feet of an approved

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1

well location of which the coal operator has knowledge, the coal

2

operator, by certified mail, shall forward to or file with the

3

well operator and the department a copy of the relevant part of

4

all maps and plans which it is presently required by law to

5

prepare and file with the department, showing the pillar which

6

the coal operator proposes to leave in place around each oil or

7

gas well in the projected workings. Thereafter, the coal

8

operator may proceed with mining operations in the manner

9

projected on the maps and plans, but the operator may not remove

10

coal or cut a passageway within 150 feet of the well or approved

11

well location without written approval under this section. If,

12

in the opinion of the well operator or the department, the plan

13

indicates that the proposed pillar is inadequate to protect

14

either the integrity of the well or public health and safety,

15

the affected well operator shall attempt to reach an agreement

16

with the coal operator on a suitable pillar, subject to approval

17

of the department. Upon failure to agree, the well operator may,

18

within ten days after receipt of the proposed plan under this

19

section, file objections under section 3251 (relating to

20

conferences), indicating the size of the pillar to be left as to

21

each well. If objections are not timely filed and the department

22

has none, the department shall grant approval, reciting that

23

maps and plans have been filed, no objections have been made

24

thereto and the pillar proposed to be left for each well is

25

approved in the manner as projected.

26

(b)  Objections.--If an objection is filed by the well

27

operator or raised by the department, the department shall order

28

that a conference be held under section 3251 within ten days of

29

the filing of objections. At the conference, the coal operator

30

and the person who has objected shall attempt to agree on a

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1

proposed plan, showing the pillar to be left around each well,

2

which will satisfy the objections and receive department

3

approval. If an agreement is reached, the department shall grant

4

approval to the coal operator, reciting that a plan has been

5

filed and the pillar to be left for each well is approved

6

pursuant to the agreement. If an agreement is not reached on a

7

plan showing the pillar to be left with respect to a well, the

8

department, by appropriate order, shall determine the pillar to

9

be left with respect to the well. In a proceeding under this

10

section, the department shall follow as nearly as is possible

11

the original plan filed by the coal operator. The department

12

shall not require the coal operator to leave a pillar in excess

13

of 100 feet in radius, except that the department may require a

14

pillar of up to 150 feet in radius if the existence of unusual

15

conditions is established. Pillars determined by the department

16

shall be shown on maps or plans on file with the department as

17

provided in subsection (a), and the department shall approve the

18

pillar to be left for each well.

19

(c)  Pillars of reduced size.--Application may be made at any

20

time to the department by the coal operator to leave a pillar of

21

a size smaller than shown on the plan approved or determined by

22

the department under this section. If an application is filed,

23

the department shall:

24

(1)  follow the appropriate procedure under subsection

25

(a) or (b);

26

(2)  by appropriate order, determine a plan involving a

27

pillar of a smaller size as to any well covered by the

28

application; and

29

(3)  grant approval for the pillar to be left with

30

respect to each well.

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1

(d)  Violation.--No coal operator, without written approval

2

of the department after notice and opportunity for a hearing

3

under this section, shall remove coal or cut a passageway so as

4

to leave a pillar of smaller size, with respect to an oil or gas

5

well, than that approved by the department under this chapter.

6

(e)  Limitation.--With regard to a coal pillar required by

7

law to be left around a well drilled prior to April 18, 1985,

8

nothing in this chapter shall be construed to:

9

(1)  require a well operator to pay for the coal pillar;

10

(2)  affect a right which a coal operator may have had

11

prior to April 18, 1985, to obtain payment for the coal

12

pillar; or

13

(3)  affect a duty or right which a storage operator or

14

landowner may have had prior to April 18, 1985, to pay or not

15

pay for the coal pillar.

16

(f)  Mining through plugged wells.--A coal operator who

17

intends to mine through a plugged oil or gas well or otherwise

18

completely remove any pillar from around that well shall file a

19

plan under subsection (a) which shall be subject to all of the

20

provisions of this section. No coal operator may mine through a

21

plugged oil or gas well of which he has knowledge until written

22

approval has been granted by the department in accordance with

23

this section. The Bureau of Deep Mine Safety in the department

24

shall have the authority to establish conditions under which the

25

department may approve a coal operator's plan to mine through a

26

plugged oil or gas well.

27

§ 3225.  Bonding.

28

(a)  General rule.--The following shall apply:

29

(1)  Except as provided in subsection (d), upon filing an

30

application for a well permit, and before continuing to

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1

operate an oil or gas well, the owner or operator of the well

2

shall file with the department a bond covering the well and

3

well site on a form to be prescribed and furnished by the

4

department. A bond filed with an application for a well

5

permit shall be payable to the Commonwealth and conditioned

6

upon the operator's faithful performance of all drilling,

7

water supply replacement, restoration and plugging

8

requirements of this chapter. A bond for a well in existence

9

on April 18, 1985, shall be payable to the Commonwealth and

10

conditioned upon the operator's faithful performance of all

11

water supply replacement, restoration and plugging

12

requirements of this chapter. The amount of the bond required

13

shall be in the following amounts and may be adjusted by the

14

Environmental Quality Board every two years to reflect the

15

projected costs to the Commonwealth of plugging the well:

16

(i)  For wells with a total well bore length less

17

than 6,000 feet:

18

(A)  For operating up to 50 wells, $4,000 per

19

well; but no bond may be required under this clause

20

in excess of $35,000.

21

(B)  For operating 51 to 150 wells, $35,000 plus

22

$4,000 per well for each well in excess of 50 wells;

23

but no bond may be required under this clause in

24

excess of $60,000.

25

(C)  For operating 151 to 250 wells, $60,000 plus

26

$4,000 per well for each well in excess of 150 wells;

27

but no bond may be required under this clause in

28

excess of $100,000.

29

(D)  For operating more than 250 wells, $100,000

30

plus $4,000 per well for each well in excess of 250

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1

wells; but no bond may be required under this clause

2

in excess of $250,000.

3

(ii)  For wells with a total well bore length greater

4

than 6,000 feet:

5

(A)  For operating up to 25 wells, $10,000 per

6

well; but no bond may be required under this clause

7

in excess of $60,000.

8

(B)  For operating 26 to 50 wells, $60,000 plus

9

$10,000 per well for each well in excess of 25 wells;

10

but no bond may be required under this clause in

11

excess of $120,000.

12

(C)  For operating 51 to 150 wells, $120,000 plus

13

$10,000 per well for each well in excess of 50 wells;

14

but no bond may be required under this clause in

15

excess of $180,000.

16

(D)  For operating more than 150 wells, $180,000

17

plus $10,000 per well for each well in excess of 150

18

wells; but no bond may be required under this clause

19

in excess of $250,000.

20

(2)  In lieu of individual bonds for each well, an owner

21

or operator may file a blanket bond for the applicable amount

22

under paragraph (1), on a form prepared by the department,

23

covering all of its wells in this Commonwealth, as enumerated

24

on the bond form.

25

(3)  Liability under the bond shall continue until the

26

well has been properly plugged in accordance with this

27

chapter and for a period of one year after filing of the

28

certificate of plugging with the department. Each bond shall

29

be executed by the operator and a corporate surety licensed

30

to do business in this Commonwealth and approved by the

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1

secretary. In lieu of a corporate surety, the operator may

2

deposit with the department:

3

(i)  cash;

4

(ii)  certificates of deposit or automatically

5

renewable irrevocable letters of credit, from financial

6

institutions chartered or authorized to do business in

7

this Commonwealth and regulated and examined by the

8

Commonwealth or a Federal agency, which may be terminated

9

at the end of a term only upon 90 days' prior written

10

notice by the financial institution to the permittee and

11

the department;

12

(iii)  negotiable bonds of the United States

13

Government or the Commonwealth, the Pennsylvania Turnpike

14

Commission, the General State Authority, the State Public

15

School Building Authority or any municipality within the

16

Commonwealth; or

17

(iv)  United States Treasury Bonds issued at a

18

discount without a regular schedule of interest payments

19

to maturity, otherwise known as Zero Coupon Bonds, having

20

a maturity date of not more than ten years after the date

21

of purchase and at the maturity date having a value of

22

not less than the applicable amount under paragraph (1).

23

The cash deposit, certificate of deposit, amount of the

24

irrevocable letter of credit or market value of the

25

securities shall be equal at least to the sum of the

26

bond.

27

(4)  The secretary shall, upon receipt of a deposit of

28

cash, letters of credit or negotiable bonds, immediately

29

place the same with the State Treasurer, whose duty it shall

30

be to receive and hold the same in the name of the

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1

Commonwealth, in trust, for the purpose for which the deposit

2

is made.

3

(5)  The State Treasurer shall at all times be

4

responsible for custody and safekeeping of deposits. The

5

operator making the deposit shall be entitled from time to

6

time to demand and receive from the State Treasurer, on the

7

written order of the secretary, the whole or any portion of

8

collateral deposited, upon depositing with the State

9

Treasurer, in lieu of that collateral, other collateral of

10

classes specified in this section having a market value at

11

least equal to the sum of the bond, and also to demand,

12

receive and recover the interest and income from the

13

negotiable bonds as they become due and payable.

14

(6)  If negotiable bonds on deposit under this subsection

15

mature or are called, the State Treasurer, at the request of

16

the owner of the bonds, shall convert them into other

17

negotiable bonds, of classes specified in this section,

18

designated by the owner.

19

(7)  If notice of intent to terminate a letter of credit

20

is given, the department shall give the operator 30 days'

21

written notice to replace the letter of credit with other

22

acceptable bond guarantees as provided in this section. If

23

the owner or operator fails to timely replace the letter of

24

credit, the department shall draw upon and convert the letter

25

of credit into cash and hold it as a collateral bond

26

guarantee.

27

(b)  Release.--No bond shall be fully released until the

28

requirements of subsection (a) and section 3223 (relating to

29

notification and effect of well transfer) have been fully met.

30

Upon release of bonds and collateral under this section, the

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1

State Treasurer shall immediately return to the owner the

2

specified amount of cash or securities.

3

(c)  Noncompliance.--If a well owner or operator fails or

4

refuses to comply with subsection (a), regulations promulgated

5

under this chapter or conditions of a permit relating to this

6

chapter, the department may declare the bond forfeited and shall

7

certify the same to the Attorney General, who shall proceed to

8

enforce and collect the full amount of the bond and, if the well

9

owner or operator has deposited cash or securities as collateral

10

in lieu of a corporate surety, the department shall declare the

11

collateral forfeited and direct the State Treasurer to pay the

12

full amount of the funds into the Well Plugging Restricted

13

Revenue Account or to sell the security to the extent forfeited

14

and pay the proceeds into the Well Plugging Restricted Revenue

15

Account. If a corporate surety or financial institution fails to

16

pay a forfeited bond promptly and in full, the corporate surety

17

or financial institution shall be disqualified from writing

18

further bonds under this chapter or any other environmental law

19

administered by the department. A person aggrieved by reason of

20

forfeiting the bond or converting collateral, as provided in

21

this section, shall have a right to appeal to the Environmental

22

Hearing Board in the manner provided by law. Upon forfeiture of

23

a blanket bond for a violation occurring at one or more well

24

sites, the person whose bond is forfeited shall, within ten days

25

of the forfeiture, submit a replacement bond to cover all other

26

wells of which the person is an owner or operator. Failure to

27

submit the replacement bond constitutes a violation of this

28

section as to each of the wells owned or operated by the person.

29

(d)  Alternatives to certain bonds.--The following shall

30

apply:

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1

(1)  An operator of not more than 200 wells who cannot

2

obtain a bond for a well drilled prior to April 18, 1985, as

3

required under subsection (a), due to inability to

4

demonstrate sufficient financial resources may, in lieu of

5

the bond:

6

(i)  Submit to the department a fee in the amount of

7

$50 per well, a blanket fee of $500 for ten to 20 wells

8

or a blanket fee of $1,000 for more than 20 wells, which

9

shall be a nonrefundable fee paid each year that the

10

operator has not filed a bond with the department. All

11

fees collected in lieu of a bond under this subsection

12

shall be used for the purposes authorized by this

13

chapter. The Environmental Quality Board shall have the

14

power, by regulation, to increase the amount of the fees

15

established under this subsection.

16

(ii)  Make phased deposits of collateral to fully

17

collateralize the bond, subject to the following:

18

(A)  Payment shall be based on the number of

19

wells owned or operated. The operator shall make an

20

initial deposit and make annual deposits in

21

accordance with the schedule in clause (B). Interest

22

accumulated by the collateral shall become a part of

23

the bond until the collateral plus accumulated

24

interest equals the amount of the required bond. The

25

collateral shall be deposited, in trust, with the

26

State Treasurer as provided in this subsection or

27

with a bank selected by the department which shall

28

act as trustee for the benefit of the Commonwealth to

29

guarantee the operator's compliance with the

30

drilling, water supply replacement, restoration and

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1

plugging requirements of this chapter. The operator

2

shall be required to pay all costs of the trust.

3

(B)  An operator of up to ten existing wells who

4

does not intend to operate additional wells shall

5

deposit $250 per well and shall, thereafter, annually

6

deposit $50 per well until the obligations of this

7

section are fully met. An operator of 11 to 25 wells

8

or an operator of up to ten wells who applies for one

9

or more permits for additional wells shall deposit

10

$2,000 and shall, thereafter, annually deposit $1,150

11

plus $150 for each additional well to be permitted

12

that year until the obligations of this section are

13

fully met. An operator of 26 to 50 wells shall

14

deposit $3,000 and shall, thereafter, annually

15

deposit $1,300 plus $400 for each additional well to

16

be permitted that year until the obligations of this

17

section are fully met. An operator of 51 to 100 wells

18

shall deposit $4,000 and shall, thereafter, annually

19

deposit $1,500 plus $400 for each additional well to

20

be permitted that year until the obligations of this

21

section are fully met. Operators of 101 to 200 wells

22

shall deposit $8,000 and shall, thereafter, annually

23

deposit $1,600 plus $1,000 for each additional well

24

to be permitted that year until the obligations of

25

this section are fully met. Operators of more than

26

200 wells shall fully bond their wells immediately.

27

(C)  The department shall reduce the amount of

28

phased collateral payments or the period of time over

29

which phased collateral payments shall be made on

30

behalf of owners or operators who, prior to August 1,

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1

1992, have paid a fee in lieu of bond under

2

subparagraph (i), and who, by August 1, 1993, choose

3

to enter the phased collateral program under this

4

subparagraph rather than continue to make payments in

5

lieu of bond. Payments made prior to August 1, 1992,

6

in lieu of bond shall not be credited in any other

7

manner, and the department shall not be required to

8

refund the fees. The Environmental Quality Board, by

9

regulation, may change the annual deposits

10

established under clause (B) if necessary to

11

accommodate a change in the amount of the bond

12

required under this section.

13

(2)  An operator may continue to pay a fee in lieu of

14

bond or make phased deposits of collateral to fully

15

collateralize the bond so long as the operator does not miss

16

a payment under this subsection and remains in compliance

17

with this chapter. If an operator misses a payment under this

18

subsection, the operator shall immediately:

19

(i)  submit the appropriate bond amount in full; or

20

(ii)  cease all operations and plug all wells.

21

(d.1)  Individuals.--The following shall apply:

22

(1)  An individual who is unable to obtain a bond to

23

drill new wells due to inability to demonstrate financial

24

resources may meet the collateral bond requirements of

25

subsection (a) by making phased deposits of collateral to

26

fully collateralize the bond. The individual shall be limited

27

to drilling ten new wells per calendar year and, for each

28

well to be drilled, deposit $500 and make an annual deposit

29

of 10% of the remaining bond amount for a period of ten

30

years. Interest accumulated shall become a part of the bond

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1

until the collateral plus accumulated interest equals the

2

amount of the required bond. The collateral shall be

3

deposited in trust with the State Treasurer under subsection

4

(a) or with a bank selected by the department which shall act

5

as trustee for the benefit of the Commonwealth to guarantee

6

the individual's compliance with the drilling, water supply

7

replacement, restoration and plugging requirements of this

8

chapter. The individual shall pay all costs of the trust.

9

(2)  Individuals may continue to use phased collateral to

10

obtain permits if they have not missed a payment for a well

11

drilled under this provision and remain in compliance with

12

this chapter. If an individual misses a payment, the

13

individual shall:

14

(i)  immediately submit the appropriate bond amount

15

in full; or

16

(ii)  cease all operations and plug all wells.

17

(3)  For purposes of this subsection, an "individual"

18

means a natural person doing business under his own name.

19

(e)  Reservation of remedies.--All remedies violating this

20

chapter, regulations adopted under this chapter and conditions

21

of permits are expressly preserved. Nothing in this section

22

shall be construed as an exclusive penalty or remedy for

23

violations of law. No action taken under this section shall

24

waive or impair any other remedy or penalty provided in law.

25

(f)  Change of law.--Owners or operators who have failed to

26

meet the requirements of this section prior to August 1, 1992,

27

shall not be required to make payments under this section on a

28

retroactive basis as a condition of obtaining a permit under

29

this chapter, nor shall the failure be deemed a violation of

30

this chapter.

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1

§ 3226.  Oil and Gas Technical Advisory Board.

2

(a)  Creation of board.--The Oil and Gas Technical Advisory

3

Board is created, consisting of the following members, all of

4

whom shall be chosen by the Governor and shall be residents of

5

this Commonwealth:

6

(1)  Three individuals, each of whom shall be:

7

(i)  a petroleum engineer;

8

(ii)  a petroleum geologist; or

9

(iii)  an experienced driller representative of the

10

oil and gas industry with three years of experience in

11

this Commonwealth.

12

(2)  One mining engineer from the coal industry with

13

three years of experience in this Commonwealth.

14

(3)  One geologist or petroleum engineer with three years

15

of experience in this Commonwealth, who shall be chosen from

16

a list of three names submitted by the Citizens Advisory

17

Council to the Governor and who shall sit as a representative

18

of the public interest.

19

(b)  Reimbursement.--Board members shall not receive a salary

20

but shall be reimbursed for all necessary expenses incurred in

21

the performance of their duties.

22

(c)  Majority vote.--All actions of the board shall be by

23

majority vote. The board shall meet as called by the secretary,

24

but not less than semiannually, to carry out its duties under

25

this chapter. The board shall select a chairman and other

26

officers deemed appropriate.

27

(d)  Consultation.--The department shall consult with the

28

board in the formulation, drafting and presentation stages of

29

all regulations of a technical nature promulgated under this

30

chapter. The board shall be given a reasonable opportunity to

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1

review and comment on all regulations of a technical nature

2

prior to submission to the Environmental Quality Board for

3

initial consideration. The written report of the board shall be

4

presented to the Environmental Quality Board with any regulatory

5

proposal. The chairman of the board shall be invited to

6

participate in the presentation of all regulations of a

7

technical nature before the Environmental Quality Board to the

8

extent allowed by procedures of the Environmental Quality Board.

9

Nothing herein shall preclude any member of the board from

10

filing a petition for rulemaking with the Environmental Quality

11

Board in accordance with procedures established by the

12

Environmental Quality Board.

13

SUBCHAPTER C

14

UNDERGROUND GAS STORAGE

15

Sec.

16

3231.  Reporting requirements for gas storage operations.

17

3232.  Reporting requirements for coal mining operations.

18

3233.  General gas storage reservoir operations.

19

3234.  Gas storage reservoir operations in coal areas.

20

3235.  Inspection of facilities and records.

21

3236.  Reliance on maps and burden of proof.

22

3237.  Exemptions and prohibitions.

23

§ 3231.  Reporting requirements for gas storage operations.

24

(a)  General rules.--The following shall apply:

25

(1)  A person injecting into or storing gas in a storage

26

reservoir underlying or within 3,000 linear feet of a coal

27

mine operating in a coal seam that extends over the storage

28

reservoir or reservoir protective area shall, within 60 days,

29

file with the department a copy of a map and certain data in

30

the form and manner provided in this subsection or as

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1

otherwise prescribed by regulation of the department.

2

(2)  A person injecting gas into or storing gas in a

3

storage reservoir which is not under or within 3,000 linear

4

feet of, but less than 10,000 linear feet from, a coal mine

5

operating in a coal seam that extends over the storage

6

reservoir or reservoir protective area shall file the map and

7

data within 60 days or a longer period set by departmental

8

regulation.

9

(3)  A person proposing to inject or store gas in a

10

storage reservoir located as defined in paragraph (1) or (2)

11

shall file the appropriate required map and data with the

12

department not less than six months prior to starting the

13

actual injection or storage.

14

(4)  A map required by this subsection shall be prepared

15

by a competent engineer or geologist, showing:

16

(i)  the stratum in which the existing or proposed

17

storage reservoir is or is proposed to be located;

18

(ii)  the geographic location of the outside

19

boundaries of the storage reservoir and reservoir

20

protective area;

21

(iii)  the location of all known oil or gas wells in

22

the reservoir or within 3,000 linear feet thereof which

23

have been drilled into or through the storage stratum,

24

indicating which have been or are to be cleaned out and

25

plugged or reconditioned for storage along with the

26

proposed location of all additional wells which are to be

27

drilled within the storage reservoir or within 3,000

28

linear feet thereof.

29

(5)  The following, if available, shall be furnished for

30

all known oil or gas wells which have been drilled into or

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1

through the storage stratum within the storage reservoir or

2

within 3,000 linear feet thereof: name of the operator, date

3

drilled, total depth, depth of production if the well was

4

productive of oil or gas, the initial rock pressure and

5

volume, the depths at which all coal seams were encountered

6

and a copy of the driller's log or other similar information.

7

At the time of the filing of the maps and data, a statement

8

shall be filed:

9

(i)  detailing efforts made to determine that the

10

wells shown are accurately located on the map;

11

(ii)  affirming that the wells shown represent, to

12

the best of the operator's knowledge, all oil or gas

13

wells which have ever been drilled into or below the

14

storage stratum within the proposed storage reservoir or

15

within the reservoir protective area;

16

(iii)  stating whether the initial injection is for

17

testing purposes;

18

(iv)  stating the maximum pressure at which injection

19

and storage of gas is contemplated; and

20

(v)  providing a detailed explanation of the methods

21

to be used or which previously have been used in

22

drilling, cleaning out, reconditioning and plugging wells

23

in the storage reservoir or within the reservoir

24

protective area.

25

(6)  The map and data required to be filed under

26

paragraph (5) shall be amended or supplemented semiannually

27

if material changes occur. The department may require a

28

storage operator to amend or supplement the map or data at

29

more frequent intervals if material changes have occurred

30

justifying the earlier filing.

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1

(b)  Other reporting requirements.--A person who is injecting

2

gas into or storing gas in a storage reservoir not at the time

3

subject to subsection (a), by a process other than that of

4

secondary recovery or gas recycling, shall, within 60 days, or a

5

longer period set by departmental regulations, file maps and

6

data required by departmental regulation and as follows:

7

(1)  A person who, after April 18, 1985, proposes to

8

inject or store gas in a storage reservoir in an area not

9

covered by subsection (a) by a process other than that of

10

secondary recovery or gas recycling shall file the required

11

map and data with the department not less than six months

12

prior to the starting of actual injection or storage.

13

(2)  The map shall be prepared by a competent engineer or

14

competent geologist and show:

15

(i)  the stratum in which the existing or proposed

16

storage reservoir is or is to be located;

17

(ii)  the geographic location of the outside

18

boundaries of the storage reservoir; and

19

(iii)  the location of all known oil or gas wells

20

within the reservoir, or within 3,000 linear feet

21

thereof, which have been drilled into or through the

22

storage stratum, indicating which have been or are to be

23

cleaned out and plugged or reconditioned for storage and

24

the proposed location of all additional wells which are

25

to be drilled within the storage reservoir or within

26

3,000 linear feet thereof.

27

(3)  The following, if available, shall be furnished for

28

all known oil or gas wells which have been drilled into or

29

through the storage stratum within the storage reservoir or

30

within 3,000 linear feet thereof: name of the operator, date

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1

drilled, total depth, depth of production if the well was

2

productive of oil or gas, the initial rock pressure and

3

volume and a copy of the driller's log or other similar

4

information. At the time of the filing of the maps and data,

5

a statement shall be filed:

6

(i)  detailing efforts made to determine that the

7

wells shown are accurately located on the map;

8

(ii)  affirming that the wells shown represent, to

9

the best of the operator's knowledge, all oil or gas

10

wells which have ever been drilled into or below the

11

storage stratum within the proposed storage reservoir;

12

(iii)  stating whether the initial injection is for

13

testing purposes;

14

(iv)  stating the maximum pressure at which injection

15

and storage of gas is contemplated; and

16

(v)  providing a detailed explanation of the methods

17

to be used or which previously have been used in

18

drilling, cleaning out, reconditioning and plugging wells

19

in the storage reservoir.

20

(4)  The map and data required to be filed under

21

paragraph (3) shall be amended or supplemented semiannually

22

if material changes occur. The department may require a

23

storage operator to amend or supplement the map or data at

24

more frequent intervals if material changes have occurred

25

justifying the earlier filing.

26

(c)  Political subdivisions.--Storage operators shall give

27

notice to the department of the name of each political

28

subdivision and county in which the operator maintains and

29

operates a gas storage reservoir.

30

(d)  Notice to affected persons.--At the time of the filing

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1

of maps and data and the filing of amended or supplemental maps

2

or data required by this section, the person filing the

3

information shall give written notice of the filing to all

4

persons who may be affected under the provisions of this chapter

5

by the storage reservoir described in the maps or data. Notices

6

shall contain a description of the boundaries of the storage

7

reservoir. When a person operating a coal mine or owning an

8

interest in coal properties which are or may be affected by the

9

storage reservoir requests, in writing, a copy of any map or

10

data filed with the department, the copy shall be furnished by

11

the storage operator.

12

(e)  Outside boundaries.--For purposes of this chapter, the

13

outside boundaries of a storage reservoir shall be defined by

14

the location of those wells around the periphery of the storage

15

reservoir which had no gas production when drilled in the

16

storage stratum. The boundaries shall be originally fixed or

17

subsequently changed if, based on the number and nature of the

18

wells and the geological and production knowledge of the storage

19

stratum, its character, permeability, distribution and operating

20

experience, it is determined in a conference under section 3251

21

(relating to conferences) that modifications should be made.

22

(f)  Inapplicability of section.--The requirements of this

23

section shall not apply to the operator of an underground gas

24

storage reservoir so long as the reservoir is located more than

25

10,000 linear feet from an operating coal mine, except that the

26

storage operator shall give notice to the department of the name

27

of each political subdivision and county in which the operator

28

maintains and operates a gas storage reservoir. In political

29

subdivisions and counties where both gas storage reservoirs and

30

coal mines are being operated, the department may request the

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1

storage operator to furnish maps showing geographical locations

2

and outside boundaries of the storage reservoirs. The department

3

shall keep a record of the information and promptly notify the

4

coal operator and the storage operator when notified by them

5

that the coal mine and storage reservoir are within 10,000

6

linear feet of each other.

7

§ 3232.  Reporting requirements for coal mining operations.

8

(a)  General rule.--A person owning or operating a coal mine

9

shall file with the department a map prepared and sealed by a

10

competent individual licensed as a professional engineer or

11

professional land surveyor under the provisions of the act of

12

May 23, 1945 (P.L.913, No.367), known as the Engineer, Land

13

Surveyor and Geologist Registration Law, showing the outside

14

coal boundaries of the operating coal mine, the existing

15

workings and exhausted areas and the relationship of the

16

boundaries to identifiable surface properties and landmarks. A

17

person owning or operating an operating coal mine which has been

18

penetrated by a well shall furnish a mine map to the department

19

each year indicating the excavations for the preceding year and

20

the projections for the ensuing year. The map required by this

21

subsection shall be furnished to a person storing or

22

contemplating the storage of gas in the vicinity of operating

23

coal mines, upon written request, by the coal operator, and the

24

person and the department shall thereafter be informed of any

25

boundary changes at the time the changes occur. The department

26

shall keep a record of the information and promptly notify the

27

coal operator and storage operator when notified by them that

28

the coal mine and the storage reservoir are within 10,000 linear

29

feet of each other.

30

(b)  Mines near certain reservoirs.--A person owning or

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1

operating any coal mine which is or which comes within 10,000

2

linear feet of a storage reservoir and where the coal seam being

3

operated extends over the storage reservoir or reservoir

4

protective area shall, within 45 days after receiving notice

5

from the storage operator of that fact, file with the department

6

and furnish to the person operating the storage reservoir a map

7

in the form required by subsection (a) showing, in addition to

8

the requirements of subsection (a), existing and projected

9

excavations and workings of the operating coal mine for the

10

ensuing 18-month period and the location of oil or gas wells of

11

which the coal operator has knowledge. The person owning or

12

operating the coal mine shall, each six months thereafter, file

13

with the department and furnish to the person operating the

14

storage reservoir a revised map showing any additional

15

excavations and workings, together with the projected

16

excavations and workings for the then ensuing 18-month period,

17

which may be within 10,000 linear feet of the storage reservoir.

18

The department may require a coal operator to file revised maps

19

at more frequent intervals if material changes have occurred

20

justifying earlier filing. The person owning or operating the

21

coal mine shall also file with the department and furnish the

22

person operating the reservoir prompt notice of any wells which

23

have been cut into, together with all available pertinent

24

information.

25

(c)  Mines near gas storage reservoirs.--A person owning or

26

operating a coal mine who has knowledge that it overlies or is

27

within 2,000 linear feet of a gas storage reservoir shall,

28

within 30 days, notify the department and the storage operator

29

of that fact.

30

(d)  Mines projected to be near storage reservoirs.--When a

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1

person owning or operating a coal mine expects that, within the

2

ensuing nine-month period, the coal mine will be extended to a

3

point which will be within 2,000 linear feet of any storage

4

reservoir, the person shall notify the department and storage

5

operator in writing of that fact.

6

(e)  New mines.--A person intending to establish or

7

reestablish an operating coal mine which will be over a storage

8

reservoir or within 2,000 linear feet of a storage reservoir or

9

may, within nine months thereafter, be expected to be within

10

2,000 linear feet of a storage reservoir shall immediately

11

notify the department and storage operator in writing. Notice

12

shall include the date on which the person intends to establish

13

or reestablish the operating coal mine.

14

(f)  Misdemeanor.--A person who serves notice as required by

15

this subsection of an intention to establish or reestablish an

16

operating coal mine, without intending in good faith to

17

establish or reestablish the mine, is liable for continuing

18

damages to a storage operator injured by the improper notice and

19

commits a misdemeanor subject to the penalties of section 3255

20

(relating to penalties).

21

§ 3233.  General gas storage reservoir operations.

22

(a)  General rule.--A person who operates or proposes to

23

operate a storage reservoir, except one filled by the secondary

24

recovery or gas recycling process, shall:

25

(1)  Use every known method which is reasonable under the

26

circumstances for discovering and locating all wells which

27

have or may have been drilled into or through the storage

28

reservoir.

29

(2)  Plug or recondition, as provided in departmental

30

regulations, all known wells drilled into or through the

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1

storage reservoir, except to the extent otherwise provided in

2

subsections (b) and (c).

3

(b)  Wells to be plugged.--To comply with subsection (a),

4

wells which are to be plugged shall be plugged in the manner

5

specified in section 3220 (relating to plugging requirements).

6

(b.1)  Wells plugged prior to enactment of section.--If a

7

well located in the storage reservoir area has been plugged

8

prior to April 18, 1985, and on the basis of data, information

9

and other evidence submitted to the department, it is determined

10

that the plugging was done in the manner required by section

11

3220 or approved as an alternative method under section 3221

12

(relating to alternative methods) and the plugging is still

13

sufficiently effective to meet the requirements of this chapter,

14

the obligations under subsection (a) with regard to plugging the

15

well shall be considered to have been fully satisfied.

16

(c)  Wells to be reconditioned.--The following shall apply:

17

(1)  To comply with subsection (a), wells which are to be

18

reconditioned shall, unless the department by regulation

19

specifies a different procedure, be cleaned out from the

20

surface through the storage horizon, and the producing casing

21

and casing strings determined not to be in good physical

22

condition shall be replaced with new casing, using the same

23

procedure as is applicable to drilling a new well under this

24

chapter. In the case of wells to be used for gas storage, the

25

annular space between each string of casing and the annular

26

space behind the largest diameter casing to the extent

27

possible shall be filled to the surface with cement or

28

bentonitic mud or a nonporous material approved by the

29

department under section 3221. At least 15 days prior to

30

reconditioning, the storage operator shall give notice to the

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1

department, setting forth in the notice the manner in which

2

it is planned to recondition the well and any pertinent data

3

known to the storage operator which will indicate the

4

condition of the well existing at that time. In addition, the

5

storage operator shall give the department at least 72 hours'

6

notice of the time when reconditioning is to begin. If no

7

objections are raised by the department within ten days, the

8

storage operator may proceed with reconditioning in

9

accordance with the plan as submitted. If objections are made

10

by the department, the department may fix a time and place

11

for a conference under section 3251 (relating to conferences)

12

at which the storage operator and department shall endeavor

13

to agree on a plan to satisfy the objections and meet the

14

requirements of this section. If no agreement is reached, the

15

department may, by an appropriate order, determine whether

16

the plan as submitted meets the requirements of this section

17

or what changes, if any, are required. If, in reconditioning

18

a well in accordance with the plan, physical conditions are

19

encountered which justify or necessitate a change in the

20

plan, the storage operator may request that the plan be

21

changed. If the request is denied, the department shall fix a

22

conference under section 3251 and proceed in the same manner

23

as with original objections. An application may be made in

24

the manner prescribed by section 3221 for approval of an

25

alternative method of reconditioning a well. If a well

26

located within the storage reservoir was reconditioned, or

27

drilled and equipped, prior to April 18, 1985, the

28

obligations imposed by subsection (a), as to reconditioning

29

the well, shall be considered fully satisfied if, on the

30

basis of the data, information and other evidence submitted

- 92 -

 


1

to the department, it is determined that:

2

(i)  The conditioning or previous drilling and

3

equipping was done in the manner required in this

4

subsection, in regulations promulgated under this chapter

5

or in a manner approved as an alternative method in

6

accordance with section 3221.

7

(ii)  The reconditioning or previous drilling and

8

equipping is still sufficiently effective to meet the

9

requirements of this chapter.

10

(2)  If a well requires emergency repairs, this chapter

11

shall not be construed to require the storage operator to

12

give any notice required by this subsection before making the

13

repairs.

14

(d)  Exception.--The requirements of subsection (a) shall not

15

apply to injection of gas into a stratum when the sole purpose

16

of injection, referred to in this subsection as testing, is to

17

determine whether the stratum is suitable for storage purposes.

18

Testing shall be conducted only in compliance with the following

19

requirements:

20

(1)  The person testing or proposing to test shall comply

21

with section 3231 (relating to reporting requirements for gas

22

storage operations) and verify the statement required to be

23

filed by that section.

24

(2)  The storage operator shall give at least six months'

25

written notice to the department of the fact that injection

26

of gas for testing purposes is proposed.

27

(3)  If the department has objections, the department

28

shall fix a time and place for a conference under section

29

3251, not more than ten days from the date of notice to the

30

storage operator, at which time the storage operator and

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1

department shall attempt to resolve the issues presented. If

2

an agreement cannot be reached, the department may issue an

3

appropriate order.

4

(e)  Failure to execute lawful order.--In a proceeding under

5

this chapter, if the department determines that an operator of a

6

storage reservoir has failed to carry out a lawful order issued

7

under this chapter, the department may require the operator to

8

suspend operation of the reservoir and withdraw the gas until

9

the violation is remedied, in which case the storage operator,

10

limited by due diligence insofar as existing facilities utilized

11

to remove gas from the reservoir will permit, shall:

12

(1)  if possible, remove the amount required by the

13

department to be removed; or

14

(2)  in any event, remove the maximum amount which can be

15

withdrawn in accordance with recognized engineering and

16

operating procedures.

17

(f)  Duty of storage reservoir operator.--The following shall

18

apply:

19

(1)  A person owning or operating a storage reservoir

20

subject to this chapter shall have a duty to:

21

(i)  Maintain all wells drilled into or through the

22

reservoir in a condition, and operate them in a manner,

23

sufficient to prevent the escape of gas.

24

(ii)  Operate and maintain the reservoir and its

25

facilities as prescribed by departmental regulations and

26

at a pressure which will prevent gas from escaping, but

27

the pressure shall not exceed the highest rock pressure

28

found to have existed during the production history of

29

the reservoir or another high pressure limit approved by

30

the department after holding a conference under section

- 94 -

 


1

3251 based on geological and production knowledge of the

2

reservoir, its character, permeability distribution and

3

operating experience.

4

(2)  The duty under paragraph (1) shall not be construed

5

to include inability to prevent the escape of gas when gas

6

escapes as a result of an act of God or a person not under

7

the control of the storage operator. In that instance, the

8

storage operator shall have a duty to take action reasonably

9

necessary to prevent further escape of gas. This paragraph

10

does not apply to a well which the storage operator failed to

11

locate and make known to the department.

12

§ 3234.  Gas storage reservoir operations in coal areas.

13

(a)  General rule.--A person operating a storage reservoir

14

which underlies or is within 2,000 linear feet of a coal mine

15

operating in a coal seam that extends over the storage reservoir

16

or the reservoir protective area shall:

17

(1)  Use every known reasonable method for discovering

18

and locating all wells which have or may have been drilled

19

into or through the storage stratum in the acreage lying

20

within the outside coal boundaries of the operating coal mine

21

overlying the storage reservoir or the reservoir protective

22

area.

23

(2)  Plug or recondition, as provided by section 3220

24

(relating to plugging requirements) and subsection (e), all

25

known wells, except to the extent provided in subsections

26

(e), (f), (g) and (h), drilled into or through the storage

27

stratum and located within the portion of the acreage of the

28

operating coal mine overlying the storage reservoir or the

29

reservoir protective area. If an objection is raised as to

30

use of a well as a storage well and after a conference under

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1

section 3251 (relating to conferences), it is determined by

2

the department, taking into account all circumstances and

3

conditions, that the well should not be used as a storage

4

well, the well shall be plugged unless, in the opinion of the

5

storage operator, the well may be used as a storage well in

6

the future, in which case, upon approval of the department

7

after taking into account all circumstances and conditions,

8

the storage operator may recondition and inactivate the well

9

rather than plug it.

10

(3)  The requirements of paragraph (2) shall be deemed to

11

have been fully complied with if, as the operating coal mine

12

is extended, all wells which from time to time come within

13

the acreage described in paragraph (2) are reconditioned or

14

plugged as provided in section 3220 and subsection (e) or (f)

15

so that, by the time the coal mine has reached a point within

16

2,000 linear feet of the wells, they will have been

17

reconditioned or plugged in accordance with section 3220 and

18

subsection (e) or (f).

19

(b)  Verified statement.--A person operating a storage

20

reservoir referred to in subsection (a) shall file with the

21

department and furnish a copy to the person operating the

22

affected operating coal mine a verified statement setting forth:

23

(1)  That the map and any supplemental maps required by

24

section 3231(a) (relating to reporting requirements for gas

25

storage operations) have been prepared and filed in

26

accordance with section 3231.

27

(2)  A detailed explanation of what the storage operator

28

has done to comply with the requirements of subsection (a)(1)

29

and (2) and the results of those actions.

30

(3)  Such additional efforts, if any, as the storage

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1

operator is making and intends to make to locate all wells.

2

(4)  Any additional wells that are to be plugged or

3

reconditioned to meet the requirements of subsection (a)(2).

4

(b.1)  Order of department.--If the statement required under

5

subsection (b) is not filed by the storage reservoir operator

6

within the time specified by this chapter or the regulations of

7

the department, the department may order the operator to file

8

the statement.

9

(c)  Procedure.--Within 120 days after receipt of a statement

10

required by this section, the department may direct that a

11

conference be held in accordance with section 3251 to determine

12

whether the requirements of section 3231 and subsection (a) have

13

been fully met. At the conference, if any person believes the

14

requirements have not been fully met, the parties shall attempt

15

to agree on additional actions to be taken and the time for

16

completion, subject to approval of the department. If an

17

agreement cannot be reached, the department shall make a

18

determination and, if the department determines any requirements

19

have not been met, the department shall issue an order

20

specifying in detail the extent to which the requirements have

21

not been met and the actions which the storage operator must

22

complete to meet the requirements. The order shall grant as much

23

time as is reasonably necessary to fully comply. If the storage

24

operator encounters conditions not known to exist at the time of

25

issuance of the order and which materially affect the validity

26

of the order or the ability of the storage operator to comply

27

with it, the storage operator may apply for a rehearing or

28

modification of the order.

29

(d)  Notification.--If, in complying with subsection (a), a

30

storage operator, after filing the statement provided for in

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1

subsection (b), plugs or reconditions a well, the storage

2

operator shall notify the department and the coal operator

3

affected, in writing, setting forth facts indicating the manner

4

in which the plugging or reconditioning was done. Upon receipt

5

of the notification, the coal operator or department may request

6

a conference under section 3251.

7

(e)  Plugging wells.--In order to meet the requirements of

8

subsection (a), wells which are to be plugged shall be plugged

9

in the manner specified in regulations promulgated under section

10

3211 (relating to well permits). When a well located within the

11

storage reservoir or the reservoir protective area has been

12

plugged prior to April 18, 1985, and, on the basis of the data

13

information and other evidence submitted to the department, it

14

is determined that the plugging was done in the manner required

15

by section 3220, or in a manner approved as an alternative

16

method in accordance with section 3221 (relating to alternative

17

methods), and the plugging is still sufficiently effective to

18

meet the requirements of this chapter, the requirements of

19

subsection (a) as to plugging the well shall be considered to

20

have been fully satisfied.

21

(f)  Reconditioned wells.--The following shall apply:

22

(1)  In order to comply with subsection (a), unless the

23

department by regulation specifies a different procedure,

24

wells which are to be reconditioned shall be cleaned out from

25

the surface through the storage horizon, and the following

26

casing strings shall be pulled and replaced with new casing,

27

using the procedure applicable to drilling a new well under

28

this chapter:

29

(i)  the producing casing;

30

(ii)  the largest diameter casing passing through the

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1