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Real Estate Law

Steptoe & Johnson PLLC: PA Marcellus Commission Issues Report, Recommendations

By Kristian E. White

On July 22nd, Pennsylvania Governor Tom Corbett's Marcellus Shale Advisory Commission released its report, setting forth 96 recommendations designed to ensure the responsible development of the Commonwealth's natural gas resources.   

The Commission suggested:

  • Increasing the cost of well bonding from $2,500 to $10,000 per deep well and the cost of blanket bonding from $25,000 up to $250,000 per blanket bond
  • Doubling the maximum civil penalties for violating the Oil and Gas Act  from $25,000 to $50,000 and the daily penalty from $1,000 to $2,000

With respect to the protection of water supplies, the Commission acknowledged that there have been incidents of groundwater contamination. However, the Commission found that such incidents were the result of operator negligence rather than the hydraulic fracturing process itself. Nevertheless, the Commission proposed:

  • Increasing the presumed liability associated with the contamination of water sources from 1,000 feet of a well to within 2,500 feet of a well, and from 6 months to 12 months of completion or alteration of a well 
  • Increasing setback distance from 200 to 500 feet for a private water well and 1,000 feet for a public water supply 
  • Well operators be responsible for the transporting, processing, and treatment/disposal of wastewater from high-volume wells (i.e., 80,000 gallons or more of water used).  
  • Pre-drilling notification be extended from 1,000 feet to 2,500 feet from the proposed well and to any municipality within 2,500 feet to help minimize public disturbances. 

The Commission made it clear that its goal is to encourage the growth of the natural gas industry in Pennsylvania, but not at the cost of environmental and public safety degradation.  Click here to see the full report.

Should you have any questions about this alert, please contact Kristian White.  For general questions involving energy law, please contact the Energy Team at Steptoe & Johnson PLLC.

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