COAL AND GAS RESOURCE COORDINATION ACT - MINIMUM DISTANCE BETWEEN GAS
     WELLS, VOLUNTARY AGREEMENTS AND VALIDITY OF VOLUNTARY AGREEMENTS
                 Act of Nov. 29, 2004, P.L. 1341, No. 171             Cl. 58
                             Session of 2004
                               No. 2004-171

     HB 2804

                                  AN ACT

     Amending the act of December 18, 1984 (P.L.1069, No.214),
        entitled "An act requiring coordination of coal mine and gas
        well operators; authorizing Department of Environmental
        Resources enforcement powers; and providing penalties,"
        further providing for minimum distance between gas wells, for
        voluntary agreements and for validity of voluntary
        agreements.

        The General Assembly of the Commonwealth of Pennsylvania
     hereby enacts as follows:

        Section 1.  Sections 7, 8 and 9 of the act of December 18,
     1984 (P.L.1069, No.214), known as the Coal and Gas Resource
     Coordination Act, are amended to read:
      Section 7.  Minimum distance between gas wells.
        (a)  No permit for a gas well covered by this act may be
     issued to drill a new gas well, or reopen a gas well which has
     been plugged in accordance with the Gas Operations Well-Drilling
     Petroleum and Coal Mining Act, unless the proposed gas well is
     located not less than 1,000 feet from any other well. [and not
     less than 330 feet from the boundary of the tract on which the
     gas well is to be located.] For the purpose of this section,
     "other well" shall not include any:
            (1)  Oil or gas well or injection well which does not
        penetrate a workable coal seam.
            (2)  Oil or gas well or injection well which has been
        plugged in accordance with this act or any other act of this
        Commonwealth which would meet State and Federal requirements
        for the safe mining through of a gas well.
            (3)  Nonproducing oil or gas well which was drilled and
        abandoned prior to November 30, 1955.
            (4)  Storage well.
        (b)  The department shall, upon request of the permit
     applicant or the owner of the workable coal seam which underlies
     the proposed gas well, grant an exception from the minimum 1,000
     feet distance requirement of subsection (a), where the permit
     applicant and the owner of the workable coal seam consent in
     writing. In no case shall the minimum distance between the
     proposed gas well and any other well be less than 900 feet
     pursuant to this subsection.
        (c)  The department shall, upon the request of the permit
     applicant or the owner of the workable coal seam which underlies
     the proposed gas well, grant an exception to the requirements of
     subsection (a), where the vertical distance between the
     producing formation of the proposed gas well and the producing
     formation of any other well is 1,000 feet or greater, where the
     permit applicant and the owner of the workable coal seam consent
     in writing.
        [(d)  The department shall, upon request of the permit
     applicant, grant an exception from the requirement that a gas
     well may not be located less than 330 feet from the boundary of
     the tract on which the gas well is to be located if any of the
     following conditions are proven:
            (1)  The proposed gas well must be located within 330
        feet of the boundary to conform to the requirements of the
        Gas Operations Well-Drilling Petroleum and Coal Mining Act.
            (2)  The topography of the tract on which the proposed
        gas well is to be located is such that it cannot be located
        any place on the tract which is not within 330 feet of the
        boundary of the tract.
            (3)  The nature, character or location of the producing
        formations sought to be drilled are such that drilling the
        gas well more than 330 feet from the boundary of the tract
        would not be efficient or economical or would prevent removal
        of the maximum amount of gas.
            (4)  Locating the proposed gas well less than 330 feet
        from the boundary of the tract is necessary to protect
        property or to protect against potential injury to any
        natural person.
            (5)  If the proposed gas well must be located within 330
        feet to take advantage of any exception pursuant to
        subsection (b) or (c) or this subsection.
            (6)  If the proposed gas well must be located within 330
        feet as the result of any recommendation of the panel
        provided for in section 12.
      Section 8.  Voluntary agreements.
        The owners of adjoining rights in oil and gas properties may
     agree to combine the rights in order to establish a tract to
     conform to the requirements of section 7. The agreements shall
     be in writing.
      Section 9.  Validity of voluntary agreements.
        No agreement entered into for the purpose of complying with
     section 7 or for the purpose of bringing about the integrated
     development or operation of gas properties shall be held to
     violate any statute of this Commonwealth prohibiting monopolies
     or acts, arrangements, agreements, contracts, combinations or
     conspiracies in restraint of trade or commerce.]
        Section 2.  This act shall take effect immediately.

     APPROVED--The 29th day of November, A. D. 2004.

     EDWARD G. RENDELL