DEP details plan to split drilling rules

HARRISBURG – A clause tucked into a Pennsylvania budget bill that directs the Department of Environmental Protection to split apart its regulations for traditional and shale gas wells will set back a major revision of the state's oil and gas rules, but agency officials say it will not require them to start over.

A fiscal code amendment inserted late in the budget process instructs the state's environmental rulemaking board to create separate rules for conventional wells — generally, shallow vertical wells — and unconventional wells that tap shale formations using technologies like horizontal drilling and hydraulic fracturing.

DEP has decided to divide the "Oil and Gas Wells" chapter of Pennsylvania's environmental protection regulations in two: Chapter 78 for conventional wells and Chapter 78a for unconventional wells, agency officials said at a citizens advisory board meeting on Tuesday.

"I don’t think that there are going to be substantive impacts to the bifurcation of those conventional and unconventional regulations," DEP Secretary E. Christopher Abruzzo said. "It will require a change in form."

He added that the change will delay the already more than two-year-old process of updating rules for oil and gas surface operations, which, he said, "not surprisingly, is a disappointment to me."

"While I certainly understand the concern of the folks from the conventional industry — and I am not questioning why they wanted to see these regulations separated — the reality is just the separation is going to necessarily delay the process," Mr. Abruzzo said. "We're going to do everything we can to limit that delay to just a couple of months, if at all possible."

The conventional oil and gas industry and its supporters lobbied for the changes, which were first proposed in identical House and Senate bills this spring and were endorsed by committees in each chamber. The full legislature never debated the measures before the text of the bills was inserted into a crucial budget bill less than two weeks before it was signed by Gov. Tom Corbett.

In public meetings, policy documents and private emails to the Corbett administration, the conventional industry pushed to separate the rules both to clarify the standards and as part of an effort to relax environmental regulations and enforcement they say threaten the small businesses that operate many traditional wells. But DEP officials indicated that they do not intend to soften the current rules, which agency leaders say already distinguish between conventional and unconventional operations.

"Essentially what we're doing is basically a change in format," DEP policy director Hayley Book told the committee. "We’re taking the existing Chapter 78 regulations, copying them into 78a, removing all references about conventional operations from 78a and removing all references to unconventional operations from Chapter 78."

DEP plans to move toward finalizing its regulatory update with two chapters instead of one, she said. The agency will issue an official notice of the draft of its final rule likely sometime next year and take public comments on the proposed changes.

The fiscal code amendment instructs the rulemaking board to write separate rules for the conventional and unconventional drilling industries under the state's oil and gas law "or other laws of this commonwealth" that relate to the industries, but DEP does not intend to split apart other regulations that might apply to the oil and gas industry, like those for air quality, water and waste.

"The Chapter 78 regulations are the only regulations that are exclusive to the oil and gas industry, and are the only regulations in which 'conventional' and 'unconventional' are used,” DEP spokeswoman Morgan Wagner said. "Splitting other regulations would not provide the clarity that splitting Chapter 78 would provide and would simply create identical, split regulations."

Laura Legere:

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