PRIOR PRINTER'S NOS. 682, 3523 PRINTER'S NO. 3934
No. 614 Session of 1989
INTRODUCED BY BOWLEY, BLACK, YANDRISEVITS, VAN HORNE,
D. R. WRIGHT, VEON, DISTLER, F. TAYLOR, KOSINSKI, BELFANTI,
PRESTON, TRELLO, JADLOWIEC, BROUJOS, MERRY, SERAFINI, DeWEESE
AND FARGO, MARCH 6, 1989
AS RE-REPORTED FROM COMMITTEE ON APPROPRIATIONS, HOUSE OF
REPRESENTATIVES, AS AMENDED, JUNE 29, 1990
AN ACT
1 Amending the act of December 19, 1984 (P.L.1140, No.223),
2 entitled "An act relating to the development of oil and gas
3 and coal; imposing duties and powers on the Department of
4 Environmental Resources; imposing notification requirements
5 to protect landowners; and providing for definitions, for
6 various requirements to regulate the drilling and operation
7 of oil and gas wells, for gas storage reservoirs, for various
8 reporting requirements, including certain requirements
9 concerning the operation of coal mines, for well permits, for
10 well registration, for distance requirements, for well casing
11 requirements, for safety device requirements, for storage
12 reservoir obligations, for well bonding requirements, for a
13 Well Plugging Restricted Revenue Account to enforce oil and
14 gas well plugging requirements, for the creation of an Oil
15 and Gas Technical Advisory Board, for oil and gas well
16 inspections, for enforcement and for penalties," further
17 providing for definitions, well permits, well registration,
18 inactive status, plugging requirements, well reporting
19 requirements, bonding, the Oil and Gas Technical Advisory
20 Board, public nuisances, civil penalties, determination of
21 compliance, unlawful conduct, surcharges for new wells; and
22 further providing for local ordinances.
23 The General Assembly of the Commonwealth of Pennsylvania
24 hereby enacts as follows:
25 Section 1. The definitions of "alteration" and "well
26 operator" or "operator" in section 103 of the act of December
1 19, 1984 (P.L.1140, No.223), known as the Oil and Gas Act,
2 amended October 9, 1986 (P.L.1431, No.135), are amended and the
3 section is amended by adding a definition to read:
4 Section 103. Definitions.
5 The following words and phrases when used in this act shall
6 have the meanings given to them in this section unless the
7 context clearly indicates otherwise:
8 * * *
9 "Alteration." Any operation which changes the physical
10 characteristics of the well bore, including stimulation or
11 removing, repairing or changing the casing: Provided, however,
12 That, for the purpose of this act only, the term shall not
13 include:
14 (1) repairing or replacing of casing [with casing of the
15 same diameter and length in noncoal areas;
16 (2) repairing or replacing of production casing with
17 casing of the same or smaller diameter and length: Provided,
18 however, That] if the activity does not affect the depth or
19 diameter of the well bore, provided that the use or purpose
20 of the well does not change and provided that the activity
21 complies with regulations promulgated hereunder. However,
22 this exclusion shall not apply to production casings in coal
23 areas when said production casings are also the coal
24 protection casings and shall not apply when the method of
25 repairing or replacing the casing would affect the coal
26 protection casing;
27 [(3)] (2) nor shall it include stimulation [as a normal <--
28 initial completion procedure nor stimulation used to enhance
29 additional oil or gas zones within the same well bore.] OF A <--
30 WELL.
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1 * * *
2 "Orphan well." Any abandoned well which has been identified <--
3 to the department, DRILLED PRIOR TO THE EFFECTIVE DATE OF THIS <--
4 ACT that has not been affected or operated by the present owner
5 or operator, and which the present owner, operator or lessee has
6 received no economic benefit. This definition shall not include <--
7 any abandoned well which has been transferred in a lease or
8 through other change of ownership of the oil and gas rights by
9 an operator subsequent to the effective date of this act., <--
10 EXCEPT ONLY AS A LANDOWNER OR RECIPIENT OF A ROYALTY INTEREST
11 FROM THE WELL.
12 * * *
13 "Well operator" or "operator." The person designated as the
14 well operator or operator on the permit application or well
15 registration. Where a permit or registration was not issued, the
16 term shall mean any person who locates, drills, operates, alters
17 or plugs any well, or reconditions any well with the purpose of
18 production therefrom. In cases where a well is used in
19 connection with the underground storage of gas, the term also
20 means a "storage operator."
21 * * *
22 Section 2. Section 201(a) and (k) of the act, amended
23 October 9, 1986 (P.L.1431, No.133), are amended to read:
24 Section 201. Well permits.
25 (a) No person shall drill a well or alter any existing well,
26 except for alterations which satisfy the requirements of
27 subsection (j), without having first obtained a well permit
28 pursuant to subsections (b), (c), (d) and (e). A copy of the
29 permit shall be kept at the well site during drilling or
30 alteration of the well. However, no person shall be required to
19890H0614B3934 - 3 -
1 obtain a permit to redrill a nonproducing well, if:
2 (1) the redrilling has been evaluated and approved as
3 part of an order from the department authorizing the cleaning
4 out and plugging or replugging of a nonproducing well,
5 pursuant to section 13(c) of the act of December 18, 1984
6 (P.L.1069, No.214), known as the Coal and Gas Resource
7 Coordination Act; and
8 (2) the redrilling is incidental to the plugging or
9 replugging operation and the well subsequently is plugged
10 within 15 days of redrilling.
11 * * *
12 (k) No permit issued pursuant to this section or
13 registration issued pursuant to section 203 may be transferred
14 without prior approval of the department. Requests for approval
15 of such transfer shall be made on forms or in a manner
16 prescribed by the department. The department shall approve or
17 deny the transfer request within 45 days of receipt of a
18 complete and accurate application. The department shall only
19 have the authority to deny such request for the reasons set
20 forth in subsection (e)(4) or (5). Approval of the transfer
21 request shall permanently transfer responsibility to plug the
22 well under section 210 to the recipient of the transferred
23 permit or registration.
24 * * *
25 Section 3. Sections 203(a), 204, 210, 212(a) and 213 of the
26 act are amended to read:
27 Section 203. Well registration and identification.
28 (a) [Within one year from the effective date of this act,
29 every person owning or operating a well for which no drilling
30 permit was issued by the department shall register such well on
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1 forms or in a manner prescribed by the department, which shall
2 contain the following information:] Within one year of the
3 effective date of this amendatory act, every person who is the
4 owner or operator of a well in existence prior to April 18,
5 1985, which well has not been registered with the department and
6 for which no drilling permit has been issued by the department,
7 shall register such well with the department. Any well owner or
8 operator who registers a well pursuant to this subsection, and
9 any well owner or operator who has previously registered a well
10 pursuant to this act shall, within one year of the effective
11 date of this amendatory act, identify any abandoned well on
12 property such well owner or operator owns or leases for which <--
13 classification as an orphan well is being requested. AND REQUEST <--
14 APPROVAL FROM THE DEPARTMENT FOR CLASSIFICATION OF THE WELL AS
15 AN ORPHAN WELL. Information regarding wells to be registered or
16 identified shall be provided on forms or in a manner prescribed
17 by the department and shall include:
18 (1) The name and address of the well operator and, if
19 the well operator is a corporation, partnership or a person
20 nonresident of the Commonwealth, there shall be designated on
21 the well registration application the name and address of an
22 agent for such operator upon whom notices, orders, process or
23 other communications issued pursuant to this act may be
24 served.
25 (2) The well name of such well and the location of the
26 well indicated by a point on a 7 1/2 minute United States
27 Geological Survey topographic map or any other location
28 description sufficient to enable the department to locate the
29 well on the ground.
30 (3) The approximate date of the drilling, completion of
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1 said well and the approximate depth of said well, the
2 producing horizons, well construction information and
3 driller's logs, if available.
4 (4) An indemnity bond [or], an alternative fee in lieu
5 of bonding OR SUCH OTHER EVIDENCE OF FINANCIAL SECURITY <--
6 SUBMITTED BY THE WELL OPERATOR AND DEEMED APPROPRIATE BY THE
7 DEPARTMENT AND satisfying the requirements of section 215 or <--
8 such other evidence of financial security submitted by the
9 well operator and deemed appropriate by the department:
10 Provided, however, That no bond, alternative fee or other
11 evidence of financial security shall be required for
12 identification of an orphan well.
13 (5) A registration fee of $15 per well[, except that the
14 department may establish] or a blanket registration fee [not
15 to exceed $250 where] of $250 for multiple well registration
16 applications which are submitted simultaneously [for wells
17 that are part of the same development project. The blanket
18 registration fee shall bear a reasonable relationship to the
19 administrative costs associated with processing such multiple
20 well registration applications]. The registration fee shall
21 be waived for a period of one year from the effective date of
22 this amendatory act, and no fee shall be charged for
23 identification of an orphan well.
24 (a.1) Well owners or operators who discover abandoned wells
25 on property purchased or leased by them after expiration of the
26 one-year period provided in subsection (a) shall identify such
27 well to the department within 60 days of discovery and advise
28 the department if THAT they are seeking classification of such <--
29 well as an orphan well. No fee shall be required for such
30 identification.
19890H0614B3934 - 6 -
1 (a.2) Persons who are not well owners or operators and who
2 discover an abandoned well on property owned or leased by them
3 shall identify such well to the department within 60 days of
4 discovery and advise the department if THAT they are seeking <--
5 classification for such well as an orphan well. No fee shall be
6 required for such identification.
7 (a.3) Persons who, as a result of litigation or enforcement <--
8 proceedings initiated pursuant to this act, are determined to be
9 the owner of a well shall comply with the requirements of
10 subsection (a), including payment of any applicable registration
11 fee, within 30 days of the decision on ownership.
12 * * *
13 Section 204. Inactive status.
14 (a) Upon application, the department [may] shall grant
15 inactive status for a period of ten years for any permitted or
16 registered well [which satisfies] provided the following
17 requirements are met:
18 (1) the condition of the well is sufficient to prevent
19 damage to the producing zone or contamination of fresh water
20 or other natural resources or surface leakage of any
21 substance;
22 (2) the condition of the well is sufficient to stop the
23 vertical flow of fluids or gas within the well bore and
24 [which] is adequate to protect freshwater aquifers, [if]
25 unless the department determines the well poses a threat to
26 the health and safety of persons or property or to the
27 environment;
28 (3) [the applicant certifies that the well is of future
29 utility and presents a viable plan for utilizing the well
30 within a reasonable time] the operator anticipates future use
19890H0614B3934 - 7 -
1 of the well; and
2 (4) the applicant satisfies the bonding requirements of
3 section 215, except that the department may require
4 additional financial security for any well on which an
5 alternative fee is being paid in lieu of bonding under
6 section 215(d).
7 (b) The owner or operator of any well granted inactive
8 status shall be responsible for monitoring the mechanical
9 integrity of such well to insure that the requirements of
10 subsection (a)(1) and (2) are met and shall report the same on
11 an annual basis to the department in a manner and form as the
12 department shall prescribe by regulation.
13 [(c) Approval of inactive status under this section shall be
14 valid for a period of five years unless renewed pursuant to the
15 requirements of this section. The department shall have the
16 right to revoke such status and order the immediate plugging of
17 said well if it is in violation of this act or any other
18 statute, rule or regulation administered by the department or
19 upon receipt by the department of notice of bankruptcy
20 proceedings by the permittee.]
21 (c) Any well granted inactive status pursuant to subsection <--
22 (a) shall be returned to active status within ten years of the
23 date inactive status was granted: Provided, however, That an
24 owner or operator may request an extension of inactive status,
25 which request may be granted on a year-to-year basis if the
26 operator continues to meet the requirements of this section. An
27 operator who is granted inactive status for a well which is
28 returned to active status prior to expiration of the ten-year
29 period set forth in subsection (a) shall notify the department
30 that the well has been returned to active status and shall not
19890H0614B3934 - 8 -
1 be permitted to apply for another automatic ten-year period of
2 inactive status for such well; provided, however, that the
3 operator may request that the well be returned to inactive
4 status, and the department may grant such request on a year-to-
5 year basis if the operator continues to meet the requirements of
6 this section. The department shall approve or deny a request to
7 extend a period of inactive status or to return a well to
8 inactive status within 30 days of receipt of such request;
9 provided that such request shall not be unreasonably denied. If
10 the department issues an order denying a request to extend the
11 period of inactive status or to return a well to inactive
12 status, a well owner or operator aggrieved thereby shall have
13 the right to appeal the order to the Environmental Hearing Board
14 within 30 days of receipt of the order. During the period of any
15 such appeal, the well in question shall be granted inactive
16 status, provided the owner or operator thereof continues to meet
17 the requirements of this section for such well.
18 (C) ANY WELL GRANTED INACTIVE STATUS PURSUANT TO SUBSECTION <--
19 (A) SHALL BE PLUGGED IN ACCORDANCE WITH SECTION 210 OR RETURNED
20 TO ACTIVE STATUS WITHIN TEN YEARS OF THE DATE INACTIVE STATUS
21 WAS GRANTED, UNLESS THE OWNER OR OPERATOR APPLIES FOR AN
22 EXTENSION OF INACTIVE STATUS WHICH MAY BE GRANTED ON A YEAR-TO-
23 YEAR BASIS IF THE DEPARTMENT DETERMINES THAT THE OWNER OR
24 OPERATOR HAS DEMONSTRATED HIS ABILITY TO CONTINUE TO MEET THE
25 REQUIREMENTS OF THIS SECTION, AND THE OWNER OR OPERATOR
26 CERTIFIES THAT THE WELL WILL BE OF FUTURE USE WITHIN A
27 REASONABLE PERIOD OF TIME. AN OWNER OR OPERATOR WHO HAS BEEN
28 GRANTED INACTIVE STATUS FOR A WELL WHICH IS RETURNED TO ACTIVE
29 STATUS PRIOR TO EXPIRATION OF THE TEN-YEAR PERIOD SET FORTH IN
30 SUBSECTION (A) SHALL NOTIFY THE DEPARTMENT THAT THE WELL HAS
19890H0614B3934 - 9 -
1 BEEN RETURNED TO ACTIVE STATUS AND SHALL NOT BE PERMITTED TO
2 APPLY FOR ANOTHER AUTOMATIC TEN-YEAR PERIOD OF INACTIVE STATUS
3 FOR SUCH WELL. THE OWNER OR OPERATOR MAY MAKE APPLICATION TO
4 RETURN THE WELL TO INACTIVE STATUS, AND SUCH APPLICATION MAY BE
5 APPROVED ON A YEAR-TO-YEAR BASIS IF THE DEPARTMENT DETERMINES
6 THAT THE OWNER OR OPERATOR HAS DEMONSTRATED AN ABILITY TO
7 CONTINUE TO MEET THE REQUIREMENTS OF THIS SECTION, AND THE OWNER
8 OR OPERATOR CERTIFIES THAT THE WELL WILL BE OF FUTURE USE WITHIN
9 A REASONABLE PERIOD OF TIME. THE DEPARTMENT SHALL APPROVE OR
10 DENY AN APPLICATION TO EXTEND A PERIOD OF INACTIVE STATUS OR TO
11 RETURN A WELL TO INACTIVE STATUS WITHIN 30 DAYS OF RECEIPT OF
12 SUCH APPLICATION, AND SUCH APPLICATION SHALL NOT BE UNREASONABLY
13 DENIED. IF THE DEPARTMENT DENIES AN APPLICATION TO EXTEND THE
14 PERIOD OF INACTIVE STATUS OR TO RETURN A WELL TO INACTIVE
15 STATUS, A WELL OWNER OR OPERATOR AGGRIEVED THEREBY SHALL HAVE
16 THE RIGHT TO APPEAL SUCH DENIAL TO THE ENVIRONMENTAL HEARING
17 BOARD WITHIN 30 DAYS OF RECEIPT OF SUCH DENIAL. UPON CAUSE SHOWN
18 BY A WELL OWNER OR OPERATOR, THE BOARD MAY GRANT A SUPERSEDEAS
19 PURSUANT TO SECTION 4 OF THE ACT OF JULY 13, 1988 (P.L.530,
20 NO.94), KNOWN AS THE ENVIRONMENTAL HEARING BOARD ACT, IN ORDER
21 THAT THE WELL IN QUESTION MAY RETAIN INACTIVE STATUS DURING THE
22 PERIOD OF APPEAL.
23 (d) The department shall have the right to revoke inactive
24 status and order the immediate plugging of a well if it is in
25 violation of this act or rules or regulations promulgated
26 thereunder, or if the owner or operator demonstrates inability
27 to perform his obligations under this act or becomes financially
28 insolvent, or upon receipt by the department of notice of
29 bankruptcy proceedings by the permittee.
30 Section 210. Plugging requirements.
19890H0614B3934 - 10 -
1 (a) Upon abandoning any well, the owner or operator thereof
2 shall plug the well in a manner prescribed by regulation of the
3 department in order to stop any vertical flow of fluids or gas
4 within the well bore unless the department has granted inactive
5 status for such well pursuant to section 204[.] OR THE WELL HAS <--
6 BEEN APPROVED BY THE DEPARTMENT AS AN ORPHAN WELL PURSUANT TO
7 SECTION 203. Where the department determines that a prior owner
8 or operator received economic benefit from a well subsequent to <--
9 the effective date of the act of November 30, 1955 (P.L.756,
10 No.225), known as the Gas Operations Well-Drilling Petroleum and
11 Coal Mining Act, such prior owner or operator shall be
12 responsible for the plugging of the well., OTHER THAN ECONOMIC <--
13 BENEFIT DERIVED ONLY AS A LANDOWNER OR FROM A ROYALTY INTEREST,
14 SUBSEQUENT TO APRIL 18, 1979, FROM AN ORPHAN WELL OR FROM A WELL
15 WHICH HAS NOT BEEN REGISTERED, SUCH OWNER OR OPERATOR SHALL BE
16 RESPONSIBLE FOR THE PLUGGING OF THE WELL. Where, in the case of
17 gas wells penetrating workable coal seams which were drilled
18 prior to the effective date of the Gas Operations Well-Drilling
19 Petroleum and Coal Mining Act or which were permitted after such
20 date but not plugged in accordance with this act, the owner or
21 operator of such a well, or a coal operator or his agent,
22 proposes to plug such well for the purpose of allowing the
23 mining through of it, the gas well shall be cleaned out to a
24 depth of at least 200 feet below the coal seam in which the
25 mining through is proposed and unless impracticable, to a point
26 200 feet below the deepest minable coal seam. Such gas well
27 shall be plugged from that depth in accordance with the
28 provisions of section 13 of the act of December 18, 1984
29 (P.L.1069, No.214), known as the Coal and Gas Resource
30 Coordination Act, and the regulations of the department.
19890H0614B3934 - 11 -
1 (b) Prior to the abandonment of any well in an area
2 underlain by a workable coal seam, the well operator or owner
3 shall notify the coal operator, lessee or owner and the
4 department of his intention to plug and abandon any such well
5 and submit a plat, on a form to be furnished by the department,
6 showing the location of the well and fixing the date and time at
7 which the work of plugging will be commenced, which time shall
8 be not less than [72 hours] three working days after the time
9 when such notice is received, nor more than 30 days thereafter
10 in order that their representatives may be present at the
11 plugging of the well. Such notice may be waived by the
12 department and said coal operator, lessee or owner, and any of
13 them may likewise waive their right to be present, but such
14 waiver by coal operator, lessee or owner shall be in writing and
15 a copy thereof attached to the notice of abandonment, filed with
16 the department under this section. Whether or not such
17 representatives appear, the well operator may, if he has fully
18 complied with the requirements of this section, proceed at the
19 time fixed, to plug the well in the manner as prescribed by
20 regulation of the department. When such plugging has been
21 completed, a certificate shall be prepared and signed, on a form
22 to be furnished by the department, by two experienced and
23 qualified people who participated in the work setting forth the
24 time and manner in which the well has been plugged. One copy of
25 this certificate shall be mailed to each coal operator, lessee
26 or owner to whom notice was given by certified mail and another
27 copy shall be mailed to the department.
28 (c) Prior to the abandonment of any well, except an
29 uncompleted bore hole plugged immediately upon suspension of
30 drilling in an area not underlain by a workable coal seam, the
19890H0614B3934 - 12 -
1 well operator shall notify the department of his intention to
2 plug and abandon any such well and submit a plat, on a form to
3 be furnished by the department, showing the location of the well
4 and fixing the date and time at which the work of plugging will
5 be commenced, which time shall not be less than [72 hours] three
6 working days nor more than 30 days after the time [of mailing]
7 when such notice is received, in order that the department
8 representative may be present at the plugging of the well. Such
9 notice or waiting period may be verbally waived by the
10 department. In noncoal areas where more than one well has been
11 drilled as part of the same development project and these wells
12 are now to be plugged, it is required that the department be
13 given [72 hours'] three working days' notice prior to plugging
14 the first well of such project subject to waiver of notice
15 described herein. In the plugging of subsequent wells, no
16 additional notice shall be required if the plugging on the
17 project is continuous. If the plugging of subsequent wells is
18 delayed for any reason, notice shall be given to the department
19 of the continuation of such project. Whether or not such
20 department representative appears, the well operator may, if he
21 has fully complied with the requirements of this section,
22 proceed at the time fixed to plug the well in the manner as
23 prescribed by regulation of the department. When such plugging
24 has been completed, a certificate shall be prepared, on a form
25 to be furnished by the department, by two experienced and
26 qualified people who participated in the work, setting forth the
27 time and manner in which the well was plugged. A copy of this
28 certificate shall be mailed to the department.
29 (d) Whenever any well is to be abandoned immediately after
30 completion of drilling, the well operator shall give at least 24
19890H0614B3934 - 13 -
1 hours' notice by telephone, confirmed by certified mail, to the
2 department and to the coal operator, lessee or owner, if any,
3 fixing the date and time at which the work of plugging will be
4 commenced. Such notice may be waived by the department and said
5 coal operator, lessee or owner, and any of them may likewise
6 waive their right to be present. Whether or not any
7 representative of the department or of the coal operator, lessee
8 or owner, if any, appear, the well operator may, if he has fully
9 complied with the requirements of this section, proceed at the
10 time fixed, to plug the well in the manner provided by
11 regulation prescribed by the department. The well operator shall
12 prepare the certificate of plugging and mail copies of the same
13 as provided in subsections (b) and (c).
14 (e) If a well is an orphan well or abandoned without <--
15 plugging, the department shall have the right to enter upon the
16 well site and plug the orphan or abandoned well and to sell such
17 equipment, casing and pipe as may have been used in the
18 production of the well in order to recover the costs of
19 plugging. Said costs of plugging shall have priority over all
20 liens on said equipment, casing and pipe, and said sale shall be
21 free and clear of any such liens to the extent the costs of
22 plugging exceed the sale price. If the equipment price obtained
23 for casing and pipe salvaged at the abandoned well site is
24 inadequate to pay for the cost of plugging the well, the owner
25 or operator of the well shall be legally liable for the
26 additional costs of plugging the well.
27 (E) IF A WELL IS AN ORPHAN WELL OR ABANDONED WITHOUT <--
28 PLUGGING OR IF A WELL IS IN OPERATION BUT IS NOT REGISTERED
29 PURSUANT TO SECTION 203, THE DEPARTMENT SHALL HAVE THE RIGHT TO
30 ENTER UPON THE WELL SITE AND PLUG THE [ABANDONED] WELL AND TO
19890H0614B3934 - 14 -
1 SELL SUCH EQUIPMENT, CASING AND PIPE AT THE ABANDONED WELL OR
2 UNREGISTERED WELL SITE AS MAY HAVE BEEN USED IN THE PRODUCTION
3 OF THE WELL IN ORDER TO RECOVER THE COSTS OF PLUGGING. IN THE
4 CASE OF A WELL WHICH IS IN OPERATION BUT HAS NOT BEEN
5 REGISTERED, THE DEPARTMENT SHALL MAKE AN EFFORT TO DETERMINE
6 OWNERSHIP OF SUCH WELL AND PROVIDE WRITTEN NOTICE TO SUCH OWNER
7 OF PENDING ACTION WHICH MAY BE TAKEN PURSUANT TO THIS
8 SUBSECTION. IF THE DEPARTMENT CANNOT DETERMINE OWNERSHIP OF THE
9 WELL WITHIN 30 DAYS, IT MAY PROCEED PURSUANT TO THIS SUBSECTION.
10 [SAID COSTS] COSTS OF PLUGGING SHALL HAVE PRIORITY OVER ALL
11 LIENS ON SAID EQUIPMENT, CASING AND PIPE, AND SAID SALE SHALL BE
12 FREE AND CLEAR OF ANY SUCH LIENS TO THE EXTENT THE COSTS OF
13 PLUGGING EXCEED THE SALE PRICE. IF THE EQUIPMENT PRICE OBTAINED
14 FOR CASING AND PIPE SALVAGED AT THE ABANDONED WELL OR
15 UNREGISTERED WELL SITE IS INADEQUATE TO PAY FOR THE COST OF
16 PLUGGING THE ABANDONED OR UNREGISTERED WELL, THE OWNER OR
17 OPERATOR OF THE ABANDONED OR UNREGISTERED WELL SHALL BE LEGALLY
18 LIABLE FOR THE ADDITIONAL COSTS OF PLUGGING THE WELL.
19 Section 212. Well reporting requirements.
20 (a) Every well operator shall file with the department, on a
21 form provided by the department, an annual report specifying the
22 amount of production [from each well on an individual well
23 basis. Where said data is not available on a well basis, it may
24 be reported] on the most well-specific basis available. Annual
25 reports shall also specify the status of each well; however, in
26 subsequent years, only changes in the status need be reported.
27 [All such reports shall be kept confidential for one year after
28 the date the information is required to be filed hereunder. Upon
29 request of the well operator, the department shall extend the
30 period of confidentiality for four years. The total period of
19890H0614B3934 - 15 -
1 confidentiality shall not exceed] The department shall keep all
2 such reports confidential for five years: Provided, however,
3 That the [department] Commonwealth shall have the right to
4 utilize such information in enforcement proceedings, in making
5 designations or determinations under section 1927-A of the act
6 of April 9, 1929 (P.L.177, No.175), known as The Administrative
7 Code of 1929, or in aggregate form for statistical purposes.
8 * * *
9 Section 213. Notification and effect of well transfer.
10 The owner or operator of any well shall notify the
11 department, in writing, in such form as the department may
12 direct by regulation, of the sale, assignment, transfer,
13 conveyance or exchange by the owner or to the owner of such well
14 within 30 days after such sale, assignment, conveyance or
15 exchange. No such transfer shall relieve the well owner or
16 operator of any [liability] obligation accrued under this act,
17 nor shall it relieve him of the obligation to plug said well
18 until the requirements of section 215 have been met, after which
19 time the transferring owner or operator shall be relieved from
20 any obligation under this act including the obligation to plug
21 said well.
22 Section 4. Section 215 of the act, amended October 9, 1986
23 (P.L.1431, No.135), is amended to read:
24 Section 215. Bonding.
25 (a) (1) Except as provided in [subsections (d) and (d.1)]
26 subsection (d) hereof, upon filing an application for a well
27 permit and before continuing to operate any oil or gas well,
28 the owner or operator thereof shall file with the department
29 a bond for the well and the well site on a form to be
30 prescribed and furnished by the department. Any such bond
19890H0614B3934 - 16 -
1 filed with an application for a well permit shall be payable
2 to the Commonwealth and conditioned that the operator shall
3 faithfully perform all of the drilling, water supply
4 replacement, restoration and plugging requirements of this
5 act. Any such bond filed with the department for a well in
6 existence on the effective date of this act shall be payable
7 to the Commonwealth and conditioned that the operator shall
8 faithfully perform all of the water supply replacement,
9 restoration and plugging requirements of this act. The amount
10 of the bond required shall be in the amount of $2,500 per
11 well for at least two years following the effective date of
12 this act, after which time the bond amount may be adjusted by
13 the Environmental Quality Board every two years to reflect
14 the projected costs to the Commonwealth of performing well
15 plugging.
16 (2) In lieu of individual bonds for each well, an owner
17 or operator may file a blanket bond, on a form prepared by
18 the department, covering all of its wells in Pennsylvania as
19 enumerated on the bond form. A blanket bond shall be in the
20 amount of $25,000 for at least two years following the
21 effective date of this act, after which time the bond amount
22 may be adjusted by the Environmental Quality Board every two
23 years to reflect the projected costs to the Commonwealth of
24 performing well plugging.
25 (3) Liability under such bond shall continue until the
26 well has been properly plugged in accordance with this act
27 and for a period of one year after filing of the certificate
28 of plugging with the department. Each bond shall be executed
29 by the operator and a corporate surety licensed to do
30 business in the Commonwealth and approved by the secretary.
19890H0614B3934 - 17 -
1 The operator may elect to deposit cash, [bank] certificates
2 of deposit[,] or automatically renewable irrevocable [bank]
3 letters of credit from financial institutions chartered or
4 authorized to do business in Pennsylvania and regulated and
5 examined by the Commonwealth or a Federal agency which may be
6 terminated [by the bank] at the end of a term only upon the
7 [bank] financial institution giving 90 days prior written
8 notice to the permittee and the department or negotiable
9 bonds of the United States Government or the Commonwealth,
10 the Pennsylvania Turnpike Commission, the General State
11 Authority, the State Public School Building Authority or any
12 municipality within the Commonwealth, or United States
13 Treasury Bonds issued at a discount without a regular
14 schedule of interest payments to maturity, otherwise known as
15 Zero Coupon Bonds, having a maturity date of not more than
16 ten years after the date of purchase and at such maturity
17 date having a value of not less than $25,000, with the
18 department in lieu of a corporate surety. The cash deposit,
19 [bank] certificate of deposit, amount of such irrevocable
20 letter of credit or market value of such securities shall be
21 equal at least to the sum of the bond. The secretary shall,
22 upon receipt of any such deposit of cash, letters of credit
23 or negotiable bonds, immediately place the same with the
24 State Treasurer, whose duty it shall be to receive and hold
25 the same in the name of the Commonwealth, in trust, for the
26 purpose for which such deposit is made. The State Treasurer
27 shall at all times be responsible for the custody and
28 safekeeping of such deposits. The operator making deposit
29 shall be entitled from time to time to demand and receive
30 from the State Treasurer, on the written order of the
19890H0614B3934 - 18 -
1 secretary, the whole or any portion of any collateral so
2 deposited, upon depositing with him, in lieu thereof, other
3 collateral of the classes herein specified having a market
4 value at least equal to the sum of the bond, and also to
5 demand, receive and recover the interest and income from said
6 negotiable bonds as the same becomes due and payable. Where
7 negotiable bonds, deposited as aforesaid, mature or are
8 called, the State Treasurer, at the request of the owner
9 thereof, shall convert such negotiable bonds into such other
10 negotiable bonds of the classes herein specified as may be
11 designated by the owner. Where notice of intent to terminate
12 a letter of credit is given, the department shall give the
13 operator 30 days' written notice to replace the letter of
14 credit with other acceptable bond guarantees as provided
15 herein and, if the owner or operator fails to replace the
16 letter of credit within the 30-day notification period, the
17 department shall draw upon and convert such letter of credit
18 into cash and hold it as a collateral bond guarantee.
19 (b) No bond shall be fully released until all requirements
20 of this act identified in subsection (a) OR SECTION 213 are <--
21 fully met. Upon release of all of the bonds and collateral as
22 herein provided, the State Treasurer shall immediately return to
23 the owner the amount of cash or securities specified therein.
24 (c) If the well owner or operator fails or refuses to comply
25 with the applicable requirements of this act identified in
26 subsection (a), the regulations promulgated hereunder or the
27 conditions of the permit relating thereto, the department may
28 declare the bond forfeited and shall certify the same to the
29 Attorney General, who shall proceed to enforce and collect the
30 full amount of the bond and, where the owner or operator has
19890H0614B3934 - 19 -
1 deposited cash or securities as collateral in lieu of a
2 corporate surety, the department shall declare said collateral
3 forfeited and shall direct the State Treasurer to pay the full
4 amount of said funds into the Well Plugging Restricted Revenue
5 Account or to proceed to sell said security to the extent
6 forfeited and pay the proceeds thereof into the Well Plugging
7 Restricted Revenue Account. Should any corporate surety or
8 [bank] financial institution fail to promptly pay, in full, a
9 forfeited bond, it shall be disqualified from writing any
10 further bonds under the act or any other environmental act
11 administered by the department. Any person aggrieved by reason
12 of forfeiting the bond or converting collateral, as herein
13 provided, shall have a right to appeal to the Environmental
14 Hearing Board in the manner provided by law. Upon forfeiture of
15 a blanket bond for a violation occurring at one or more well
16 sites, the person whose bond is forfeited shall submit a
17 replacement bond to cover all other wells of which he is owner
18 or operator within ten days of said forfeiture. Failure to
19 submit said replacement bond constitutes a violation of this
20 section as to each of the wells owned or operated by said
21 person.
22 (d) (1) Any [well] operator of not more than 200 wells who <--
23 cannot obtain a bond for a well drilled prior to [the
24 effective date of this act] April 18, 1985, as required under
25 subsection (a), due to an inability to demonstrate sufficient
26 financial resources [shall submit to the department letters
27 of rejection from three separate bonding companies licensed
28 to do business in the Commonwealth. Such letters shall state
29 that the operator has been denied a bond and state the
30 grounds for denial of the bond. In] may, in lieu of the bond,
19890H0614B3934 - 20 -
1 [the operator shall] submit to the department a fee in the
2 amount of $50 per well, or a blanket fee of $500 for ten to
3 20 wells, or a blanket fee of $1,000 for [more than 20 wells]
4 21 to 100 wells, or a blanket fee of $2,000 for 101 to 200
5 wells, which shall be a [nonrefundable] fee paid each year
6 that the operator has not filed a bond with the department.
7 [The operator must demonstrate every three years a continued
8 inability to obtain a bond as prescribed above.] All fees
9 collected in lieu of a bond under this subsection shall be
10 [paid into the Well Plugging Restricted Revenue Account and
11 shall be used for the purposes authorized by this act.]
12 treated the same as bonds collected under subsection (a);
13 provided, however, that an operator may choose to pay a
14 nonrefundable blanket fee of $1,000 per year for more than 20
15 wells which fees shall be paid into the Abandoned Well
16 Plugging Fund and expended pursuant to section 601(b). The
17 Environmental Quality Board shall have the power, by
18 regulation, to increase the amount of the fees established
19 under this subsection [if it is found that the total moneys
20 collected hereunder are insufficient to reimburse the
21 Commonwealth for costs incurred in correcting violations on
22 wells covered under this subsection].
23 (2) An operator may continue to pay a fee in lieu of a
24 bond so long as no payments are missed for wells under this
25 provision and so long as the wells remain in compliance with
26 this act and regulations and permits issued thereunder. If an
27 operator has missed any payments for wells under this
28 subsection, the department shall order the operator to:
29 (i) immediately submit the appropriate bond amount
30 in full; or
19890H0614B3934 - 21 -
1 (ii) cease all operations and plug the wells in
2 accordance with section 210.
3 (3) An operator who, prior to the effective date of this
4 amendatory act, has paid a fee in lieu of bond for operation
5 of any well in existence prior to April 18, 1985, shall be
6 granted a credit in the amount of such fee against future
7 bonds or fees in lieu of bonds which shall be required
8 pursuant to this amendatory act.
9 (D) (1) ANY [WELL] OPERATOR OF NOT MORE THAN 200 WELLS WHO <--
10 CANNOT OBTAIN A BOND FOR A WELL DRILLED PRIOR TO [THE
11 EFFECTIVE DATE OF THIS ACT] APRIL 18, 1985, AS REQUIRED UNDER
12 SUBSECTION (A), DUE TO AN INABILITY TO DEMONSTRATE SUFFICIENT
13 FINANCIAL RESOURCES [SHALL SUBMIT TO THE DEPARTMENT LETTERS
14 OF REJECTION FROM THREE SEPARATE BONDING COMPANIES LICENSED
15 TO DO BUSINESS IN THE COMMONWEALTH. SUCH LETTERS SHALL STATE
16 THAT THE OPERATOR HAS BEEN DENIED A BOND AND STATE THE
17 GROUNDS FOR DENIAL OF THE BOND. IN] MAY, IN LIEU OF THE
18 BOND[, THE OPERATOR SHALL SUBMIT]:
19 (I) SUBMIT TO THE DEPARTMENT A FEE IN THE AMOUNT OF
20 $50 PER WELL, OR A BLANKET FEE OF $500 FOR TEN TO 20
21 WELLS, OR A BLANKET FEE OF $1,000 FOR MORE THAN 20 WELLS,
22 WHICH SHALL BE A NONREFUNDABLE FEE PAID EACH YEAR THAT
23 THE OPERATOR HAS NOT FILED A BOND WITH THE DEPARTMENT.
24 [THE OPERATOR MUST DEMONSTRATE EVERY THREE YEARS A
25 CONTINUED INABILITY TO OBTAIN A BOND AS PRESCRIBED
26 ABOVE.] ALL FEES COLLECTED IN LIEU OF A BOND UNDER THIS
27 SUBSECTION SHALL BE PAID INTO THE WELL PLUGGING
28 RESTRICTED REVENUE ACCOUNT AND SHALL BE USED FOR THE
29 PURPOSES AUTHORIZED BY THIS ACT. THE ENVIRONMENTAL
30 QUALITY BOARD SHALL HAVE THE POWER, BY REGULATION, TO
19890H0614B3934 - 22 -
1 INCREASE THE AMOUNT OF THE FEES ESTABLISHED UNDER THIS
2 SUBSECTION [IF IT IS FOUND THAT THE TOTAL MONEYS
3 COLLECTED HEREUNDER ARE INSUFFICIENT TO REIMBURSE THE
4 COMMONWEALTH FOR COSTS INCURRED IN CORRECTING VIOLATIONS
5 ON WELLS COVERED UNDER THIS SUBSECTION].
6 (II) (A) MAKE PHASED DEPOSITS OF COLLATERAL TO
7 FULLY COLLATERALIZE THE BOND. SUCH PAYMENT SHALL BE
8 BASED ON THE NUMBER OF WELLS THE OPERATOR OWNS OR
9 OPERATES. THE OPERATOR SHALL MAKE AN INITIAL DEPOSIT
10 AND SHALL, THEREAFTER, MAKE ANNUAL DEPOSITS IN
11 ACCORDANCE WITH THE SCHEDULE IN CLAUSE (B). INTEREST
12 ACCUMULATED BY THE COLLATERAL SHALL BECOME A PART OF
13 THE BOND UNTIL SUCH TIME AS THE COLLATERAL, PLUS
14 ACCUMULATED INTEREST, EQUALS THE AMOUNT OF THE
15 REQUIRED BOND. THE COLLATERAL SHALL BE DEPOSITED, IN
16 TRUST, WITH THE STATE TREASURER, AS PROVIDED IN THIS
17 SUBSECTION, OR WITH A BANK SELECTED BY THE DEPARTMENT
18 WHICH SHALL ACT AS TRUSTEE FOR THE BENEFIT OF THE
19 COMMONWEALTH, TO GUARANTEE THE OPERATOR'S COMPLIANCE
20 WITH THE DRILLING, WATER SUPPLY REPLACEMENT,
21 RESTORATION AND PLUGGING REQUIREMENTS OF THIS ACT.
22 THE OPERATOR SHALL BE REQUIRED TO PAY ALL COSTS OF
23 THE TRUST.
24 (B) AN OPERATOR OF UP TO TEN EXISTING WELLS WHO
25 DOES NOT INTEND TO OPERATE ADDITIONAL WELLS SHALL
26 DEPOSIT $250 PER WELL AND SHALL, THEREAFTER, ANNUALLY
27 DEPOSIT $50 PER WELL UNTIL THE OBLIGATIONS OF THIS
28 SECTION ARE FULLY MET. AN OPERATOR OF 11 TO 25 WELLS
29 OR AN OPERATOR OF UP TO TEN WELLS WHO APPLIES FOR ONE
30 OR MORE PERMITS FOR ADDITIONAL WELLS SHALL DEPOSIT
19890H0614B3934 - 23 -
1 $2,000 AND SHALL, THEREAFTER, ANNUALLY DEPOSIT
2 $1,150, PLUS $150 FOR EACH ADDITIONAL WELL TO BE
3 PERMITTED THAT YEAR, UNTIL THE OBLIGATIONS OF THIS
4 SECTION ARE FULLY MET. AN OPERATOR OR 26 TO 50 WELLS
5 SHALL DEPOSIT $3,000, AND SHALL, THEREAFTER, ANNUALLY
6 DEPOSIT $1,300, PLUS $400 FOR EACH ADDITIONAL WELL TO
7 BE PERMITTED THAT YEAR, UNTIL THE OBLIGATIONS OF THIS
8 SECTION ARE FULLY MET. AN OPERATOR OF 51 TO 100 WELLS
9 SHALL DEPOSIT $4,000 AND SHALL, THEREAFTER, ANNUALLY
10 DEPOSIT $1,500, PLUS $400 FOR EACH ADDITIONAL WELL TO
11 BE PERMITTED THAT YEAR, UNTIL THE OBLIGATIONS OF THIS
12 SECTION ARE FULLY MET. OPERATORS OF 101 TO 200 WELLS
13 SHALL DEPOSIT $8,000 AND SHALL, THEREAFTER, ANNUALLY
14 DEPOSIT $1,600, PLUS $1,000 FOR EACH ADDITIONAL WELL
15 TO BE PERMITTED THAT YEAR UNTIL THE OBLIGATIONS OF
16 THIS SECTION ARE FULLY MET. OPERATORS OF MORE THAN
17 200 WELLS SHALL FULLY BOND THEIR WELLS IMMEDIATELY.
18 THE DEPARTMENT SHALL REDUCE THE AMOUNT OF PHASED
19 COLLATERAL PAYMENTS OR THE PERIOD OF TIME OVER WHICH
20 PHASED COLLATERAL PAYMENTS SHALL BE MADE ON BEHALF OF
21 OWNERS OR OPERATORS WHO, PRIOR TO THE EFFECTIVE DATE
22 OF THIS AMENDATORY ACT, HAVE PAID A FEE IN LIEU OF
23 BOND PURSUANT TO SUBSECTION (D)(1)(I), AND WHO,
24 WITHIN ONE YEAR OF THE EFFECTIVE DATE OF THIS
25 AMENDATORY ACT, CHOOSE TO ENTER THE PHASED COLLATERAL
26 PROGRAM PURSUANT TO SUBSECTION (D)(1)(II) RATHER THAN
27 TO CONTINUE TO MAKE PAYMENTS IN LIEU OF BOND.
28 PAYMENTS MADE IN LIEU OF BOND PRIOR TO THE EFFECTIVE
29 DATE OF THIS AMENDATORY ACT SHALL NOT BE CREDITED IN
30 ANY OTHER MANNER, NOR SHALL THE DEPARTMENT BE
19890H0614B3934 - 24 -
1 REQUIRED TO REFUND SUCH FEES AT ANY TIME. THE
2 ENVIRONMENTAL QUALITY BOARD SHALL HAVE THE POWER, BY
3 REGULATION, TO CHANGE THE ANNUAL DEPOSITS ESTABLISHED
4 UNDER THIS CLAUSE IF IT IS FOUND TO BE NECESSARY TO
5 ACCOMMODATE A CHANGE IN THE AMOUNT OF THE BOND
6 REQUIRED UNDER THIS SECTION.
7 (2) AN OPERATOR MAY CONTINUE TO PAY A FEE IN LIEU OF
8 BOND OR MAKE PHASED DEPOSITS OF COLLATERAL TO FULLY
9 COLLATERALIZE THE BOND SO LONG AS THE OPERATOR DOES NOT MISS
10 ANY PAYMENTS FOR WELLS AS PROVIDED UNDER THIS SUBSECTION AND
11 SO LONG AS THE OPERATOR REMAINS IN COMPLIANCE WITH THE
12 PROVISIONS OF THIS ACT AND REGULATIONS AND PERMITS ISSUED
13 THEREUNDER. IF AN OPERATOR HAS MISSED ANY PAYMENTS FOR WELLS
14 AS PROVIDED UNDER THIS SUBSECTION, THE OPERATOR SHALL:
15 (I) IMMEDIATELY SUBMIT THE APPROPRIATE BOND AMOUNT
16 IN FULL; OR
17 (II) CEASE ALL OPERATIONS AND PLUG THE WELLS IN
18 ACCORDANCE WITH SECTION 210.
19 (d.1) (1) An individual who cannot obtain a bond to drill
20 new wells due to an inability to demonstrate financial
21 resources, as evidenced by [letters of rejection as required <--
22 under subsection (d)] statements of rejection from two
23 separate bonding companies licensed to do business in the
24 Commonwealth set forth on forms provided by the department,
25 RESOURCES, [AS EVIDENCED BY LETTERS OF REJECTION AS REQUIRED <--
26 UNDER SUBSECTION (D),] may meet the collateral bond
27 requirements of subsection (a) by making phased deposits of
28 collateral to fully collateralize the bond. Such individuals
29 shall be limited to drilling [two] ten new wells per calendar
30 year. The individual shall, for each well to be drilled,
19890H0614B3934 - 25 -
1 deposit $500 and shall, thereafter, annually deposit 10% of
2 the remaining bond amount for a period of ten years. Interest
3 accumulated by the collateral shall become a part of the bond
4 until such time as the collateral, plus accumulated interest,
5 equals the amount of the required bond. The collateral shall
6 be deposited, in trust, with the State Treasurer as provided
7 in subsection (a) or with a bank selected by the department
8 which shall act as trustee for the benefit of the
9 Commonwealth, to guarantee the individual's compliance with
10 the drilling, water supply replacement, restoration and
11 plugging requirements of this act. The individual shall be
12 required to pay all costs of the trust.
13 (2) Individuals may continue to use phased collateral to
14 obtain permits so long as they have not missed any payments
15 for wells drilled under this provision and so long as they
16 remain in compliance with this act[,] and regulations and
17 permits issued thereunder. If an individual has missed any
18 payments for wells under this subsection, the department <--
19 shall order the individual to: OPERATOR SHALL: <--
20 (i) immediately submit the appropriate bond amount
21 in full; or
22 (ii) cease all operations and plug the wells in
23 accordance with section 210.
24 For the purposes of this subsection an "individual" is defined
25 as an applicant who is a natural person doing business under his
26 own name.
27 (e) All remedies for violation of this act, the regulations
28 adopted hereunder or the conditions of permits are expressly
29 preserved. Nothing in [subsections (a), (b) and (c)] this
30 section shall be construed as an exclusive penalty or remedy for
19890H0614B3934 - 26 -
1 such violations of law. No action taken pursuant to [subsection
2 (c)] this section shall waive or impair any other remedy or
3 penalty provided in law.
4 (f) Owners or operators who have failed to meet the
5 requirements of this section prior to the effective date of this
6 amendatory act shall not be required to make payments pursuant
7 to this section on a retroactive basis as a condition of
8 obtaining a permit under this act.
9 SECTION 5. THE HEADING OF SECTION 508 OF THE ACT IS AMENDED <--
10 AND THE SECTION IS AMENDED BY ADDING A SUBSECTION TO READ:
11 SECTION 508. PRODUCTION OF MATERIALS; WITNESSES; DEPOSITIONS;
12 RIGHTS OF ENTRY; DETERMINATION OF COMPLIANCE.
13 * * *
14 (F) ANY PURCHASER OF OIL OR GAS SHALL, UPON REQUEST, PROVIDE
15 TO THE DEPARTMENT INFORMATION AS MAY BE NECESSARY FOR THE
16 DEPARTMENT TO DETERMINE OWNERSHIP OF FACILITIES FROM WHICH SUCH
17 OIL OR GAS WAS OBTAINED. SUCH INFORMATION SHALL BE KEPT
18 CONFIDENTIAL FOR A PERIOD OF FIVE YEARS. THE DEPARTMENT SHALL
19 HAVE THE RIGHT TO UTILIZE SUCH INFORMATION IN ENFORCEMENT
20 PROCEEDINGS.
21 Section 5 6. Sections 509 and 601 of the act are amended to <--
22 read:
23 Section 509. Unlawful conduct.
24 It shall be unlawful for any person to:
25 (1) Drill, alter, operate or utilize an oil or gas well
26 without a permit or registration from the department as
27 required by this act or in violation of the rules or
28 regulations adopted under this act, or orders of the
29 department, or in violation of any term or condition of any
30 permit issued by the department.
19890H0614B3934 - 27 -
1 (2) Conduct any activities related to drilling for, or
2 production of, oil and gas, contrary to the rules or
3 regulations adopted under this act, or orders of the
4 department, or any term or any condition of any permit, or in
5 any manner as to create a public nuisance or to adversely
6 affect the public health, safety, welfare or the environment.
7 (3) Refuse, obstruct, delay or threaten any agent or
8 employee of the department in the course of performance of
9 any duty under this act, including, but not limited to, entry
10 and inspection under any circumstances.
11 (4) Attempt to obtain a permit or identify a well as an
12 orphan well by misrepresentation or failure to disclose all
13 relevant facts.
14 (5) Cause the abandonment of a well by removal of casing
15 or equipment necessary for production without plugging the
16 well in a manner prescribed pursuant to section 210. The
17 owner or operator of a well may only temporarily remove
18 casing or equipment necessary for production if it is part of
19 the normal course of production activities.
20 Section 601. [Well Plugging Restricted Revenue Account.] Well
21 plugging funds.
22 (a) All fines, civil penalties, permit and registration fees
23 collected under this act [shall be paid into the State Treasury
24 into a restricted revenue account to be known as the Well
25 Plugging Restricted Revenue Account, hereby established, which
26 shall be administered by the department for the plugging and
27 sealing of abandoned wells and to cover the purposes of
28 administering this act. All the moneys from time to time paid
29 into the Well Plugging Restricted Revenue Account are
30 specifically appropriated, upon annual approval by the
19890H0614B3934 - 28 -
1 Governor,] are hereby appropriated to the Department of
2 Environmental Resources to carry out the purposes of this act.
3 (b) To aid in the indemnification of the Commonwealth for
4 the cost of plugging abandoned wells, there shall be added to
5 the permit fee established by the department under section 201
6 for new wells a $50 surcharge. All moneys [deposited in this
7 restricted revenue account from the surcharge] collected as a
8 result of this surcharge shall be paid into the State Treasury
9 into a restricted revenue account to be known as the Abandoned
10 Well Plugging Fund, hereby established, and shall be expended by
11 the department to plug abandoned wells which threaten the health
12 and safety of persons or property or pollution of the waters of
13 the Commonwealth.
14 (c) There is hereby created a restricted revenue account to
15 be known as the Orphan Well Plugging Fund. There shall be added
16 to the permit fee established by the department under section
17 201 for new wells a $100 surcharge for wells to be drilled to <--
18 3,800 feet in depth and a $250 surcharge for wells to be drilled
19 to greater than 3,800 feet in depth FOR OIL PRODUCTION AND A <--
20 $200 SURCHARGE FOR WELLS DRILLED FOR GAS PRODUCTION, which
21 surcharges shall be placed in the Orphan Well Plugging Fund and
22 shall be expended by the department to plug orphan wells. which <--
23 threaten the health and safety of persons or property or
24 pollution of the waters of the Commonwealth. If an operator
25 rehabilitates a well abandoned by another operator or an orphan
26 well, the permit fee and the surcharge for such well shall be
27 waived.
28 (d) If an operator approved by the department plugs a well <--
29 abandoned by another operator or an orphan well, which abandoned
30 or orphan well has been determined by the department to threaten
19890H0614B3934 - 29 -
1 the health and safety of persons or property or pollution of the
2 waters of the Commonwealth, and such plugging meets the
3 requirements of this act and rules and regulations promulgated
4 thereunder, the department shall compensate the operator or
5 provide the operator with a credit against bonds or fees in lieu
6 of bonds required pursuant to section 215 at a rate equal to the
7 operator's plugging costs or the department's engineering cost
8 estimate for plugging the well, whichever cost is lower.
9 Section 6 7. Section 602 of the act is amended to read: <--
10 Section 602. Local ordinances.
11 Except with respect to ordinances adopted pursuant to the act
12 of July 31, 1968 (P.L.805, No.247), known as the Pennsylvania
13 Municipalities Planning Code and the act of October 4, 1978
14 (P.L.851, No.166), known as the Flood Plain Management Act, all
15 local ordinances and enactments purporting to regulate oil and
16 gas well operations regulated by this act are hereby superseded.
17 No ordinance or enactment heretofore adopted, nor any ordinance
18 or enactment adopted by a municipality pursuant to this section <--
19 THE AFOREMENTIONED ACTS, may contain provisions which impose <--
20 conditions, requirements or limitations which duplicate,
21 supplement, vary, conflict or are inconsistent with the
22 provisions of this act or which interfere with the uniform
23 regulation of oil and gas well operations as provided for in
24 this act. The Commonwealth, by this enactment, hereby preempts
25 the regulation of oil and gas wells as herein defined.
26 Section 7 8. Section 603.1 of the act, added October 9, 1986 <--
27 (P.L.1431, No.135), is amended to read:
28 Section 603.1. Relationship to solid waste and surface mining.
29 (a) The obligation to obtain a permit and post a bond
30 pursuant to Articles III and V of the act of July 7, 1980
19890H0614B3934 - 30 -
1 (P.L.380, No.97), known as the Solid Waste Management Act, and
2 to provide public notice pursuant to section 1905-A(b)(1)(v) of
3 the act of April 9, 1929 (P.L.177, No.175), known as The
4 Administrative Code of 1929, for any pit, impoundment, method or
5 facility employed for the disposal, processing or storage of
6 residual wastes generated by the drilling of an oil or gas well
7 or from the production of such wells which is located on the
8 well site shall be satisfied if the owner or operator of the
9 well meets the following conditions:
10 (1) the well is permitted pursuant to the requirements
11 of section 201 or registered pursuant to the requirements of
12 section 203;
13 (2) the owner or operator satisfies the financial
14 security requirements of section 215 by obtaining a surety or
15 collateral bond for the well and well site; and
16 (3) the owner or operator maintains compliance with
17 [the] this act and any applicable regulations promulgated by
18 the Environmental Quality Board.
19 (b) Obligations under the act of December 19, 1984
20 (P.L.1093, No.219), known as the Noncoal Surface Mining
21 Conservation and Reclamation Act, or any rule or regulation
22 promulgated thereunder, for any borrow area where minerals are
23 extracted solely for the purpose of oil and gas well
24 development, including access road construction, shall be
25 satisfied if the owner or operator of the well meets the
26 conditions imposed under subsection (a)(1) and (2) and the owner
27 or operator maintains compliance with this act and any
28 applicable regulations promulgated by the Environmental Quality
29 Board.
30 [(b)] (c) Nothing in this section shall diminish any other
19890H0614B3934 - 31 -
1 duties or obligations that an owner or operator may have under
2 the Solid Waste Management Act. The provisions of this section
3 shall not apply to any waste which is classified as a hazardous
4 waste pursuant to the Solid Waste Management Act, or the
5 Resource Conservation and Recovery Act of 1976 (Public Law 94-
6 580, 90 Stat. 2795, 42 U.S.C. § 6901 et seq.).
7 [(c)] (d) As used in this section and sections 206 and 215,
8 the term "well site" means the areas occupied by all equipment
9 or facilities necessary for or incidental to the drilling,
10 production or plugging of a well.
11 Section 8 9. This act shall take effect in 30 days. <--
B10L58JAM/19890H0614B3934 - 32 -