the pioga press - feburary 2015

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February 2015 • Issue 58 The PIOGA press The monthly newsletter of the Pennsylvania Independent Oil & Gas Association (Continues on page 2) (Continues on page 34) ® “T his is about striking the right balance,” Governor Tom Wolf asserted as he signed an executive order on January 29 that reinstates a moratorium on new oil and gas leasing of state forest and park lands. The action rolls back the clock to late 2010, when then- Governor Ed Rendell issued an executive order near the end of his term imposing a similar leasing moratorium after he had used money from leasing to help balance the budget. Last May, Wolf’s predecessor, Tom Corbett, amended the moratorium—also to provide money to help balance the budget—to allow leasing, provided that under such agreements the natural gas could be accessed with no additional long-term surface disturbance on state lands or if drilling could occur horizontally from adjacent private lands. The current state budget includes $95 million in revenue from this new leasing. Wolf had declared during his campaign for governor that he would reinstate the full moratorium if elected. Signing his execu- tive order at Benjamin Rush State Park in Philadelphia, the new Wolf reinstates Rendell leasing moratorium governor said: “Natural gas development is vital to Pennsylvania’s economy, but so is the economic and environ- mental viability of our parks and forests. This is about striking the right balance. Our state parks and forests are unique assets that should be preserved, protected and utilized by our residents for recreational purposes.” Wolf’s executive order states that leasing of state parks is con- trary to the longstanding policy of the Department of Conservation and Natural Resources (DCNR) and that recreation and education usage of state parks account for 38 million visitors annually, support more than 13,000 jobs and generate $1.2 bil- lion for the state’s economy. Nominees for DEP and DCNR G overnor Tom Wolf’s nominees to lead the Department of Environmental Protection and the Department of Conservation and Natural resources both are former DCNR officials with ties to the anti-drilling activist group PennFuture. The DEP nominee is John Quigley, a former two-term mayor of Hazelton who served as DCNR secretary in the Rendell administration from 2009 to 2011. Prior to his appointment as secretary, Quigley worked for DCNR in several capacities, including overseeing strategic initiatives and operations, and as chief of staff. After leaving DCNR he served as a strategic advi- sor and consultant to PennFuture. It was his second stint with the group, having previously served as government relations manag- er. Most recently he was the principal of the consulting firm John H Quigley LLC. He is a graduate of Bloomsburg University with a degree in economics, and holds a master of public adminis- tration degree from Lehigh University. To give an insight into his perception of the industry, Quigley said this about shale-gas development during testimony in 2011 before the House Democratic Policy Committee: “All Pennsylvanians will feel the industry’s impacts. Damage to water. Damage to soil quali- ty. Habitat fragmentation. Air pollution Moratorium: “A lose-lose for Pennsylvania” . . 2 Impact fee adjusted upward . . . . . . . . . . . . . . 4 Coming up: PIOGA Winter Meeting . . . . . . . . 7 TENORM management considerations . . . . . 8 DEP’s TENORM report . . . . . . . . . . . . . . . . . . 8 Court limits Robinson Twp. applicability . . . . 13 Rehearing rejected in forest leasing case . . 14 “Community rights” ordinance struck down . 15 Congress looks to speed up LNG exports . . 16 January Spud Report . . . . . . . . . . . . . . . . . . 20 Lawmakers hit the ground running . . . . . . . . 24 Meet PIOGA’s newest board member . . . . . 27 Is your company an “Opportunity Maker?” . . 28 OSHA focuses on fracking operations . . . . . 31 Member newsletter submissions. . . . . . . . . . 32 Member Profile: HGA . . . . . . . . . . . . . . . . . . 32 PIOGA Member News . . . . . . . . . . . . . . . . . 33 Oil & Gas Trends . . . . . . . . . . . . . . . . . . . . . . 36 New members . . . . . . . . . . . . . . . . . . . . . . . . 38 Calendar of Events . . . . . . . . . . . . . . . . . . . . 39 PIOGA contacts . . . . . . . . . . . . . . . . . . . . . . 39 Tom Wolf signs his leasing moratorium at Benjamin Rush State Park in Philadelphia. (Associated Press photo)

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The monthly journal of the Pennsylvania Independent Oil & Gas Association (PIOGA).

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Page 1: The PIOGA Press - Feburary 2015

February 2015 • Issue 58

The

PIOGA pressThe monthly newsletter of the Pennsylvania Independent Oil & Gas Association

(Continues on page 2)

(Continues on page 34)

®

“This is about striking the right balance,” GovernorTom Wolf asserted as he signed an executive orderon January 29 that reinstates a moratorium on new

oil and gas leasing of state forest and park lands.The action rolls back the clock to late 2010, when then-

Governor Ed Rendell issued an executive order near the end ofhis term imposing a similar leasing moratorium after he had usedmoney from leasing to help balance the budget. Last May, Wolf’spredecessor, Tom Corbett, amended the moratorium—also toprovide money to help balance the budget—to allow leasing,provided that under such agreements the natural gas could beaccessed with no additional long-term surface disturbance onstate lands or if drilling could occur horizontally from adjacentprivate lands. The current state budget includes $95 million inrevenue from this new leasing.

Wolf had declared during his campaign for governor that hewould reinstate the full moratorium if elected. Signing his execu-tive order at Benjamin Rush State Park in Philadelphia, the new

Wolf reinstates Rendell leasing moratoriumgovernor said: “Natural gas development is vital toPennsylvania’s economy, but so is the economic and environ-mental viability of our parks and forests. This is about strikingthe right balance. Our state parks and forests are unique assetsthat should be preserved, protected and utilized by our residentsfor recreational purposes.”

Wolf’s executive order states that leasing of state parks is con-trary to the longstanding policy of the Department ofConservation and Natural Resources (DCNR) and that recreationand education usage of state parks account for 38 million visitorsannually, support more than 13,000 jobs and generate $1.2 bil-lion for the state’s economy.

Nominees for DEP and DCNR

Governor Tom Wolf’s nominees to lead the Department ofEnvironmental Protection and the Department ofConservation and Natural resources both are former

DCNR officials with ties to the anti-drilling activist groupPennFuture.

The DEP nominee is John Quigley, a former two-term mayorof Hazelton who served as DCNR secretary in the Rendelladministration from 2009 to 2011. Prior to his appointment assecretary, Quigley worked for DCNR in several capacities,including overseeing strategic initiatives and operations, and aschief of staff. After leaving DCNR he served as a strategic advi-sor and consultant to PennFuture. It was his second stint with thegroup, having previously served as government relations manag-er. Most recently he was the principal of the consulting firm JohnH Quigley LLC.

He is a graduate of BloomsburgUniversity with a degree in economics,and holds a master of public adminis-tration degree from Lehigh University.

To give an insight into his perceptionof the industry, Quigley said this aboutshale-gas development during testimonyin 2011 before the House DemocraticPolicy Committee: “All Pennsylvanianswill feel the industry’s impacts.Damage to water. Damage to soil quali-ty. Habitat fragmentation. Air pollution

Moratorium: “A lose-lose for Pennsylvania” . . 2Impact fee adjusted upward . . . . . . . . . . . . . . 4Coming up: PIOGA Winter Meeting . . . . . . . . 7TENORM management considerations . . . . . 8DEP’s TENORM report . . . . . . . . . . . . . . . . . . 8Court limits Robinson Twp. applicability . . . . 13Rehearing rejected in forest leasing case . . 14“Community rights” ordinance struck down . 15Congress looks to speed up LNG exports . . 16January Spud Report . . . . . . . . . . . . . . . . . . 20Lawmakers hit the ground running . . . . . . . . 24

Meet PIOGA’s newest board member . . . . . 27Is your company an “Opportunity Maker?” . . 28OSHA focuses on fracking operations . . . . . 31Member newsletter submissions. . . . . . . . . . 32Member Profile: HGA . . . . . . . . . . . . . . . . . . 32PIOGA Member News . . . . . . . . . . . . . . . . . 33Oil & Gas Trends. . . . . . . . . . . . . . . . . . . . . . 36New members. . . . . . . . . . . . . . . . . . . . . . . . 38Calendar of Events . . . . . . . . . . . . . . . . . . . . 39PIOGA contacts . . . . . . . . . . . . . . . . . . . . . . 39

Tom Wolf signs his leasing moratorium at Benjamin Rush StatePark in Philadelphia. (Associated Press photo)

Page 2: The PIOGA Press - Feburary 2015

Page 2 The PIOGA Press

Moratorium: Continued from page 1

While there has been no leasing of state park lands, there hasbeen some oil and gas development in parks where subsurfacerights are privately held. According to DCNR, only about 20 per-cent of the subsurface rights under state parks are publicallyowned, and 61 of the state’s 117 parks are above the MarcellusShale. Two Western Pennsylvania parks where conventional gasdrilling has occurred in recent years are Maurice K. GoddardState Park and Oil Creek State Park. Notably, Oil Creek StatePark, which celebrates the heritage of the oil and gas industry,was the subject of the 2009 Belden & Blake decision in whichthe state Supreme Court ruled that DCNR could not impose con-ditions on the development of privately held oil and gas rights.

More than 673,000 acres of the 2.2-million-acre state forestsystem are currently open to oil and gas development throughleases issued by DCNR (385,400 acres) or because of privatelyowned mineral rights underlying the state lands (290,000 acres).About 1.5 million acres of state forest are atop the MarcellusShale.

Since 2008, DCNR has issued three shale-specific leases thathave generated $413 million in bonus bid revenue and, accordingto a June 2014 fact sheet, $285 million in royalty payments.

Regarding leasing of state forest land, the executive orderstates that aside from the acreage listed above, a 2010 analysisby DCNR concluded that additional leasing is inappropriatebecause the remaining lands are “vital for maintaining purewater, wild and natural ecosystems and valuable recreationalopportunities that support Pennsylvania’s eco-tourism industry.”

The executive order also cites data gathered through 2012 by

DCNR as part of a project monitoring the impacts of shale devel-opment on the state forest system. The order quotes the depart-ment’s findings that “there are clearly impacts and tradeoffs thatare associated” with oil and gas development on state forestlands and it goes on to list impacts ranging from degraded wildcharacter and heavy truck traffic to loss of scenic vistas and inva-sive species and that “additional longitudinal research and moni-toring” of impacts is necessary before allowing more leasing.The need for additional study was the same rationale Rendell

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‘A lose-lose for Pennsylvania’

PIOGA President & Executive Director Lou D’Amicoissued the following statement regarding GovernorWolf’s executive order halting former Governor

Corbett’s directive allowing non-surface-impact leasing ofstate forest and park lands and reinstating the Rendell-eramoratorium on any additional leasing:

“This action is extremely unfortunate in that it eliminatesland with proven energy reserves from potential natural gasdevelopment that would not be impacted in any way duringthe process of drilling and completing a well. This decisionwill eliminate a long-term financial windfall for theCommonwealth that has already returned more than $700 mil-lion in the past seven years at a time when Pennsylvania isdesperate for new sources of revenue. Finally, the irony of thisadministration preventing drilling for a resource that they arealso seeking to tax cannot be overlooked. This is a lose-losefor Pennsylvania’s taxpayers and energy consumers.”

Page 3: The PIOGA Press - Feburary 2015

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Page 4 The PIOGA Press

used to “shut the barn door’ after he allowed the leasing moneyto escape to help balance the budgets.

However, when releasing the June 2014 report from which theabove negative findings were gleaned(dcnr.state.pa.us/forestry/NaturalGas/monitoringreport), then-DCNR Secretary Ellen Ferretti contended that “the breadth anddepth of this report demonstrates that shale gas production onstate forests is being carefully managed.”

DCNR has approved more than 1,000 shale gas wells onleased forest lands, and about 600 of them have been drilled on230 well pads. In last year’s report, the agency said it expectsroughly 3,000 gas wells ultimately will be drilled to develop theacreage the state has already leased.

As Energy In Depth highlighted in a blog post, DCNR’s shalegas monitoring report also offered these beneficial findings:

• “Modern shale-gas leases restrict surface disturbance in sen-sitive areas and limit overall surface disturbance to approximate-ly 2 percent of the acreage within the lease tract.”

• “Initial water monitoring results have not identified any sig-nificant impacts due to shale-gas development.”

• “There has been a marked decrease in several major air pol-lutants, such as sulfur, nitrogen oxides, and carbon dioxide. Thisis due, in part, to the increased use of natural gas for power gen-eration, the shutdown of several major facilities, and the installa-tion of air pollution control equipment.”

• “Approximately 15 percent of all shale gas produced inPennsylvania comes from state forest lands. This gas is sold anddistributed across the eastern and Midwestern United States toservice energy markets on a daily basis.”

Unfortunately, Governor Wolf chose to emphasize the minornegatives and sweep the considerable positives under the rugwhen issuing the moratorium and offering the rationale for hisaction.

The core of the resolution-style Executive Order 2014-03states: “As of the date of this Executive Order, to protect thelands of the Commonwealth that are held in trust for its citizensand for future generations, and subject to future advice and rec-ommendations made by DCNR, no State Park and State Forestlands owned and/or managed by DCNR shall be leased for oiland gas development.”

What about the PEDF court decision?Last month, we reported on a Commonwealth Court decision

in a lawsuit by the Pennsylvania Environmental DefenseFoundation (PEDF) challenging both the use of oil and gas leas-ing revenue for general state budgetary purposes and GovernorCorbett’s directive that DCNR offer additional non-surface-impact leases for state lands. As part of that ruling, the courtfound that DCNR, not the governor, has the exclusive authorityto decide whether to lease lands the agency administers.

In its January 7 ruling, the court found that per theConservation and Natural Resources Act (CNRA)—the 1995 lawthat created DCNR—decisions on oil and gas leasing are up tothe secretary of DCNR. The court found that although appointedagency heads “serve at the pleasure of the governor,” their pri-mary duty is to serve “the people of this Commonwealth,” whoexpect those officials to defend the environmental rights definedin the state constitution “even when faced with overwhelmingpolitical pressure, perhaps from the governor, to act against theirbetter judgment.”

“This is not to say that the Governor, as the chief executive,and the General Assembly are precluded from attempting toinfluence DCNR’s leasing decisions,” Judge P. Kevin Brobsonwrote in the majority opinion. But based on the CNRA, “the ulti-mate decision lies exclusively with DCNR, and DCNR, there-fore, is accountable for making the decision to lease and, if chal-lenged, justifying it.”

In light of this ruling, it’s logical to ask, if it’s impermissiblefor the governor to tell DCNR it must lease additional statelands, does it follow suit that the governor cannot prohibit thedepartment from leasing?

PIOGA General Counsel & Vice President GovernmentAffairs Kevin Moody thinks the answer is yes. “Based on theway Wolf’s executive order is worded, that’s what he is doing,”Moody said.

“The governor’s order states that he “direct(s)” the moratori-um to be put into place and that the action is ‘consistent with therecommendations by the acting secretary of Conservation andNatural resources’ not to lease additional state lands and is “sub-ject to future advice and recommendations made by DCNR.’That language,” Moody explains, clearly states that the governoris making the decision and DCNR is merely advising and recom-mending.”

“Regardless of the semantics, or whether the moratorium istechnically legal in light of the Commonwealth Court decision,we think Governor Wolf is making the wrong choice for theCommonwealth,” Moody continued. “At a time when the state isfacing a huge budget deficit, the governor is turning down manymillions of dollars in new revenue that can be raised withoutadditional long-term surface disturbance on state lands—and it’smoney that doesn’t come from raising anyone’s taxes.” ■

2014 i mpact fee adjusted upward

The Pennsylvania Public Utility Commission hasreleased the impact fee amounts that unconventionalwell operators must pay for the 2014 calendar year.

For a horizontal well spud in 2014, the fee increased by $300to $50,300. Vertical unconventional wells spud last yearincreased from $10,000 to $10,100.

Act 13 of 2012 directs the PUC to adjust the impact feeseach year based on the average price of gas and the consumerprice index. The NYMEX average annual price for naturalgas for 2014 was $4.145, compared against $3.562 in 2013.An adjustment of 0.6 percent also was made based on the fed-eral consumer price index for the region.

During 2014, 1,372 unconventional wells were spud, com-pared against 1,207 in 2013.

The adjustments for 2014 payments were published in theFebruary 7 Pennsylvania Bulletin.

2014 impact fee scheduleYear spud Horizontal Vertical2014 $50,300 $10,1002013 $40,200 $8,0002012 $30,200 $6,000Prior to 2012 $20,100 $4,000

Page 5: The PIOGA Press - Feburary 2015

February 2014 Page 5February 2015 Page 5

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PIOGA’s Winter Meeting is coming up Tuesday andWednesday, February 24-25, at beautiful Seven SpringsMountain Resort in Champion. As usual, it will be an

excellent mix of learning, networking and fun.The fun actually starts on Monday the 23rd with an optional

clay shoot on the Seven Springs course (weather permitting)from 11 a.m. to 2 p.m. The $100 fee includes lunch. Equipmentand ammo will be available directly through Seven Springs. Ifyou have a desire to hit the slopes, Seven Springs is offering dis-counted downhill skiing rates for February 23-25 (download theevent brochure for details).

Tuesday’s meeting runs from 9 a.m. to 5 p.m. Conference pre-sentations include:

• Review of PIOGA’s 2014 AccomplishmentsLou D’Amico, PIOGA President & Executive Director

• Legal Review and Outlook for 2015Kevin Moody, PIOGA Vice President & General Counsel

• Severance Tax ProposalsLou D’Amico, PIOGA

• Air Quality Challenges in 2015—EPA and MethaneRon Cusano, Schnader Harrison Segal & Lewis, LLPRoy Rakiewicz, ALL4, Inc.

• State Environmental Regulatory IssuesPIOGA Environmental Committee representatives

• Combatting the Crazies—Public Relations and PublicEducationDan Weaver, PIOGA Director of Public OutreachDave Mashek, Meinert/Mashek Communications

A new addition to our event is the Product and ServiceShowcase. It will provide member companies with the opportu-nity to present information about exciting new products to othermembers. There will be two blocks of concurrent Showcase ses-sions on Tuesday, running from 11 a.m. to 12:15 p.m. and thenfrom 3:45-5 p.m. Among the Showcase companies making pre-sentations are:

• AM Health & Safety, Inc.• Community Bank• Fortis Energy Services• Guttman Energy• MHF Services• PIC Appalachia• Profire Energy, Inc.• Tensar International CorporationAfter Tuesday’s sessions adjourn, a PIOGA Political Action

Committee reception ($50 minimum donation) will take place,followed by dinner and the always-popular, free-to-all-partici-pants Monte Carlo Night.

The Wednesday conference sessions go from 8:30 a.m. to12:15 p.m. and include:

•Pennsylvania Legislative Outlook for 2015Dick Gmerek, Gmerek Government Relations

• Federal legislative and Regulatory Outlook for 2015Samantha McDonald, Independent Petroleum Associationof America

• The Unconventional Well Impact Fee—the BenefitsBradford County Commissioner Doug McLinkoWashington County Commissioner Diana Irey Vaughan

Looking forward to seeing you at Seven Springs

Joe Baran, Bertison-George, LLC• Condensate and Natural Gas Liquids Safety Awareness

Wayne Vanderhoof, RJR Safety, Inc.Visit the Winter Meeting event page at www.pioga.org for any

program updates, along with online registration (onsite registra-tion is available as well for those making the last-minute deci-sion to attend), lodging and sponsorship opportunities.

See you at Seven Springs! ■

PIOGA Winter Meeting

Page 8: The PIOGA Press - Feburary 2015

Page 8 The PIOGA Press

About DEP’s TENORM study

The Department of Environmental Protection on January15 announced the results of its TENORM study, whichanalyzed the naturally occurring levels of radioactivity

associated with oil and natural gas development. While thestudy outlines recommendations for further study, it conclud-ed there is little potential for harm to workers or the publicfrom radiation exposure due to oil and gas development.

“The study report is the culmination of a multi-year effortand represents what we believe to be the most comprehensiveradiological study of the oil and gas industry ever conducted,”said Vince Brisini, DEP Deputy Secretary for Waste, Air,Radiation and Remediation. “While the recommendations forfuture actions contained in the report call for additional stud-ies and efforts, we now have data to inform the managementof natural gas resources and resultant wastes for environmen-tal and health protection.”

In January 2013, DEP began studying radioactivity levelsin flowback waters, treatment solids and drill cuttings, as wellas transportation, storage and disposal of drilling wastes. Thisincluded a study of radon levels in natural gas to ensure thatpublic health and the environment continue to be protected.

In summary, the peer-reviewed study concluded that:• There is little potential for additional radon exposure to

the public due to the use of natural gas extracted from geolog-ic formations in Pennsylvania.

• There is little or limited potential for radiation exposureto the public and workers from the development, completion,production, transmission, processing, storage and end use ofnatural gas. There are, however, potential radiological envi-ronmental impacts from fluids if spilled. Radium should beadded to the state’s spill protocol to ensure cleanups are ade-quately characterized. There are also site-specific circum-stances and situations where the use of personal protectiveequipment by workers or other controls should be evaluated.

• There is little potential for radiation exposure to workersand the public at facilities that treat oil and gas wastes. How -ever, there are potential radiological environmental impactsthat should be studied at all facilities that treat wastes todetermine if any areas require remediation. If elevated radio-logical impacts are found, the development of radiologicaldischarge limitations and spill policies should be considered.

• There is little potential for radiation exposure to the pub-lic and workers from landfills receiving waste from the oiland gas industry. However, filter cake from facilities treatingwastes could have a radiological environmental impact ifspilled, and there is also a potential long-term disposal issue.Disposal protocols should be reviewed to ensure the safety oflong-term disposal of waste containing TENORM.

• While limited potential was found for radiation exposureto recreationists using roads treated with brine from conven-tional natural gas wells, further study of radiological environ-mental impacts from the use of brine from the oil and gasindustry for dust suppression and road stabilization should beconducted.

By Richard W. ZinkDirector, Energy ServicesMHF Services

Recent regulatory activity in the areaof naturally occurring radioactive(NORM) material by the

Department of Environmental Protection hasraised questions as to who is impacted, howto comply and what impact the changes will have on oil and gascompanies operating in the Commonwealth. Many answers tothese questions can be found by benchmarking other industrieswith years of experience in managing similar materials in heavilyregulated environments.

Recent DEP TENORM study The good news is the Pennsylvania study concluded, among

other things, that no immediate risks to workers or the generalpublic exists from NORM or technologically enhanced NORM(TENORM) impacted waste generated, transported and disposedof during oil and gas exploration and production in the Common -wealth, with the possible exception of spills (see article at right).

Spills of impacted material can happen anytime during gener-ation, processing and disposal,including transit. It is important tonote that risk to the general publicin the case of an accident in transitdepends on spilled material and istherefore greatly influenced by thequality and type of packaging used.The physical characteristics of thematerials influence both the pack-aging and migration of spilledmaterials. Liquid and high mois-ture content (wet) sludge materials could migrate a distance fromthe incident site. Conversely, dry or dusty materials can becomeairborne and be carried by wind or traffic away from the incidentsite. A key component to any spill response plan is to be surethat your contractors are familiar with the risks and ways to min-imize the risks to themselves and to the public in the case of arelease.

Risks to workers were acknowledged at varying levels de -pending upon the type of materials handled and processesinvolved. Routine handling of TENORM material at sites of pro-duction, recycling or processing will result in increasing levels ofradioactive material and exposure in the workplace. Training andoperational plans/procedures should address all potential hazardsincluding TENORM. To ensure exposure remains as low as rea-sonable achievable, enhanced physical or mechanical controlscan be considered, as well as modified personal protection meas-ures to include and perhaps highlight a robust respiratory protec-tion program.

Sampling, testing and disposal programs should be carefullyevaluated by experienced professionals to ensure the long-termsafety of the worker, the public and the environment. Disposaloptions in particular should be evaluated for, their security, long-term viability and risk potential.

TENORM management considerations

Page 9: The PIOGA Press - Feburary 2015

February 2014 Page 9February 2015 Page 9

Energy andNatural Resources

Page 10: The PIOGA Press - Feburary 2015

Page 10 The PIOGA Press

Radioactive materials management program elementsWhile it is difficult to predict what federal agencies or indi-

vidual state regulating bodies will do next, what we can do is usetools at hand to implement prudent and responsible policies.Approaching the issue of proper radioactive waste managementis something that has been developed and refined over manydecades within both private industry and government. Your pro-grams, if based on these accepted practices, will ensure compli-ance and insulate your company from increasing regulatoryscrutiny.

There are existing standards such as Nuclear RegulatoryCommission (NRC) Regulatory Guidance 1.86, which addressesthe termination of operating licenses for nuclear reactors. It pro-vides an industry standard for returning equipment and facilitiessafely back to general public use and can be used by the oil andgas industry to set guidelines under which it will manage itsradiation-impacted equipment and facilities.

Additional NRC guidance provides health and safety profes-sionals with tools to enhance waste management programs. NRCBulletin 79-19, for example, addresses the packaging of low-level radioactive waste (LLRW) for transport and burial. It iden-tifies the program control requirements for LLRW generators tofollow to ensure waste is properly processed and packaged.Facilities operating under the NRC regulations also have pro-grams in place for plant and process controls, radiological sur-veys, monitoring of personnel and facility, air quality issues, res-piratory protection programs, contamination control, training andrecordkeeping

In industries which have well defined radiation protection pro-grams a simple principal known as ALARA is something that is

widely applied. ALARA is an acronym which means “as low asreasonably achievable.” This refers to benchmarks set by firms tomonitor exposures and incidents which can lead to exposures. Itdrives the company’s approach to every aspect of work whichinvolves radioactive material. ALARA becomes a part of theoverall company culture. It is encompassed in guiding principlesand procedures and drives everyday practices. IncorporatingALARA principals as part of an overall radioactive material pro-tection program is highly recommended

Packaging, transportation and disposal Distinguishing between U.S. Department of Transportation

(DOT) and other agency regulatory guidance: 49 CFR 172Subpart H, Training, details federal training requirements forhazardous material workers and should be used to establish thetraining program for all workers involved with packaging andtransporting hazardous waste. In addition, disposal facilitieslicensed by the Nuclear Regulatory Commission or AgreementStates have well defined waste acceptance criteria to whichworkers must be trained, in order to ensure waste is compliantand acceptable for disposal.

There are several types of landfills that may pro-vide protective disposal for solid residuals contain-ing radionuclides. The appropriate landfill candepend on the amount, concentration, and physicaland chemical attributes of the RAM material,Disposal at a municipal or industrial solid wastelandfill may be an option for systems disposing ofnon-hazardous waste. These landfills are regulatedunder RCRA Subtitle D. Municipal solid waste land-fills may have restrictions on the amount of radioac-tivity they accept. These landfills may accept non-hazardous, solid, and TENORM wastes from allwater systems, and hazardous waste fromConditionally Exempt Small Quantity Generators(CESQG) (40 CFR 258). Industrial solid waste land-fills may also accept non-hazardous solid TENORMwaste, and may be better equipped to handle suchwaste as it is more like the waste that industriallandfills typically handle (e.g., sludge and ash).Generally, wastes containing less than 3 pCi/g ofradium or 30 pCi/g of uranium can be disposed of inthese landfills – treatment residuals will likely exceedthese concentrations, however.

Hazardous waste landfills (regulated under RCRASubtitle C) may accept hazardous waste (though notmixed waste) from all generator classes. However,

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February 2014 Page 11February 2015 Page 11

they vary in their ability to accept TechnologicallyEnhanced Naturally Occurring RadioactiveMaterials (TENORM) wastes. Some hazardous wastelandfills have explicit permit conditions while othersmay have to request state approval before acceptingTENORM wastes.... (EPA online resources)

Commercially viable options for the disposal of a wide rangeof TENORM waste materials exist, but are limited in number.Fully licensed radiation waste disposal options should be consid-ered carefully in your firm’s long-term management program.Although these options may require long-distance transportationand disposal rates greater than those of other options, the securi-ty and lower long-term liability risk may be attractive to somefirms.

Top-to-bottom reviewsDuring the evaluation of your TENORM program there are a

number of questions that must be asked. The most basic question is: Are you or your contractors han-

dling TENORM as part of your operations? If that answer is yes,or you are not sure, your path will start there. Look internally orseek qualified subcontractors to ask the “who, what and where”to a level of detail that uncovers all known or suspected sources.Evaluate what level of sophistication each vendor has in place toproperly manage the materials and work with them to enhanceand standardize the programs to meet your administrative policycriteria. A word of caution: A customized program set up specif-ically for each entity that you engage is something which is verydifficult to implement, monitor and manage.

What waste types are being generated? The program for wastecharacterization is critical. Waste streams must be identified,with radionuclides and concentrations determined utilizing stan-dardized methods. Keep in mind that as with all proper wastemanagement programs, the generator has responsibility for thewaste. Also, that through each step the waste is properly charac-terized at origin, and while it is prepared for disposal it is stored,handled, packaged and ultimately transported for disposal in amanner consistent with all laws related to that specific wastetype. For wastes generated in the processing of materials frommany and varied locations, this effort takes on a level of com-plexity not typical in other industries. It is for this reason that avigilant and well-formed plan be formulated and adhered tothroughout operations. Evaluating the processes of your contrac-tors may lead to policy which guides how you manage your spe-cific waste and recycled materials.

In addition, ask whether all individuals and entities involvedare qualified to manage the materials being generated. Do theyhave the requisite training, certifications, licensing and experi-ence to engage in the work contemplated? Have qualified profes-sionals been consulted or placed on staff to address the issuesassociated with radioactive materials? Facilities must engage cer-tified health physics personnel to properly establish a radiationand waste control program as well as to perform routine monitor-ing, audits and recordkeeping.

In the end, it is likely that industry will set a responsible stan-dard to be met and that will affect change as much or more thanthose changes dictated by state or federal regulatory agencies.Taking a proactive posture that is based in sound and provenprincipals will produce the best long-term solutions. ■

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Page 13: The PIOGA Press - Feburary 2015

February 2014 Page 13February 2015 Page 13

The evolution of Act 13:Commonwealth Court limitsapplicability of RobinsonTownship plurality opinion

Pennsylvania’s evolving law regarding regulation of oil andgas development has undergone yet another change, thistime in a footnote to the Commonwealth Court’s January

7, 2015 en banc opinion in Pennsylvania Environmental DefenseFoundation v. Commonwealth 2015 Pa. Commw. LEXIS 9(2015). The Pennsylvania Environmental Defense Foundation(PEDF) case, in which PIOGA filed an amicus brief, rejectedconstitutional challenges to the leasing of state land for naturalgas development and to the use of funds generated by those leas-es. In doing so, the Commonwealth Court took the opportunityto clarify the legal weight to be given to the analysis of the plu-rality decision in Robinson Township v. Commonwealth, 83 A.2d901 (2013) interpreting Article I, Section 27 of the PennsylvaniaConstitution (the Environmental Rights Amendment).

By way of background, in Robinson Township the SupremeCourt invalidated various sections of Act 13, the GeneralAssembly’s 2012 comprehensive update to the former Oil andGas Act. The three-justice plurality opinion in RobinsonTownship, authored by Chief Justice Castille, introduced a newand much more extensive interpretation and application of theEnvironmental Rights Amendment (ERA), finding that it impos-es on the Commonwealth and its municipalities a fiduciary dutyto “conserve and maintain” natural resources. According to theplurality, this “implicates a duty to prevent and remedy thedegradation, diminution, or depletion of our public naturalresources.” The plurality found that this duty is two-fold, com-prised of “a duty to refrain from permitting or encouraging thedegradation, diminution, or depletion of public naturalresources” and a duty “to act affirmatively to protect the environ-ment, via legislative action.” As a result, the plurality found thatcertain provisions of Act 13, including the provision limitinglocal regulation of oil and gas development, failed to satisfythese duties. Justice Baer provided the fourth vote in support ofthis ruling, although he did so on substantive due processgrounds and not the ERA.

In articulating its interpretation of the ERA, the pluralityopinion did not define the scope of the duty or provide a test fordetermining whether its requirements are satisfied, thus creatinguncertainty regarding what the law requires of governmentsbefore they take action that may impact natural resources.Heralding the Robinson Township decision as breathing new lifeinto the ERA, numerous parties, including the PEDF, tookadvantage of this uncertainty to contest government actionsbefore a variety of tribunals.

For example, residents in several municipalities have chal-lenged the validity of local zoning ordinances before their zoninghearing boards, arguing that the existing oil and gas regulationsdo not go far enough to satisfy the ERA, as interpreted andapplied in Robinson Township. Others have appealed permitsissued by the Department of Environmental Protection to theEnvironmental Hearing Board, arguing that the agency’s fiduci-

ary duty prohibits it from authorizing oiland gas development. In the absence ofapplicable guidance in the RobinsonTownship plurality opinion, these partieshave asserted their own interpretation as towhat the ERA means, insisting, for exam-ple, that the applicable agency must under-take a constellation of environmental orhealth and safety studies before allowing(via permitting or legislation) oil and gasdevelopment. In the case of local zoningregulations, these challenges also haveincluded claims that ordinances that permitoil and gas operations in agricultural andresidential zoning districts violate the ERA.

In the case decided in January, the PEDFchallenged Fiscal Code amendments permit-ting the transfer of monies from the Oil andGas Lease Fund—a depository for all rentsand royalties paid from oil and gas leases onCommonwealth lands, which is traditionallyused to maintain and conserve public natu-ral resources—to fund the Depart -ment of Conservation and NaturalResources’ operations, theTreasury, and the GeneralAppropriations Act of 2014. All together, the challenged legisla-tive enactments envision spending well over or in excess of $250million from the lease fund in FY 2014-2015. PEDF argued,among other things, that these amendments violated the ERAbecause they fail to fulfill the duty to conserve and maintain thepublic natural resources for the benefit of the people.

In a critical footnote, the Commonwealth Court in PEDF stat-ed that the Robinson Township decision is not binding precedent,but merely persuasive authority “to the extent it is consistentwith binding precedent from [the Commonwealth] Court and theSupreme Court on the same subject.” The court also acknowl-edged the remaining legitimacy of the pre-existing multifactorialtest for constitutionality under the ERA expressed by theCommonwealth Court in Payne v. Kassab, 312 A.2d 86, 94 (Pa.Commw. Ct. 1973) (en banc), aff’d, 361 A.2d 263 (Pa. 1976).

Unlike the Robinson Township plurality opinion, the Paynedecision and its progeny emphasized the need for the Common -wealth to balance its duties under the ERA against other dutiesowed by the Commonwealth to its citizens; those cases acknowl-edge that the protections of the ERA are not absolute, and werenot intended to prohibit development. Importantly, the PEDFdecision confirms that Payne, not Robinson Township, containsthe operative test for deciding challenges brought under theERA. As a result, the Commonwealth Court unanimously1 heldin PEDF that the challenged appropriations were constitutionallysound, declaring a “decision by the General Assembly…to vestin itself the power to appropriate certain monies in the LeaseFund does not by itself infringe upon the rights afforded…underthe Environmental Rights Amendment.”

Notably, a Commonwealth Court en banc decision—like thatin PEDF—can be overturned only by a subsequent en banc deci-sion of that court or a ruling from the state Supreme Court. As aresult, the Commonwealth Court’s brief consideration of theRobinson Township plurality decision and its conclusion that it is

Krista-AnnStaley, Esq.

Blaine A. Lucas,Esq.

Authors:

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Page 14 The PIOGA Press

not binding precedent, along with its clarification that the Paynetest is still authoritative, may significantly limit the persuasive-ness of Robinson Township-inspired constitutional argumentsbefore local zoning and state environmental tribunals, at leastuntil there is a definitive ruling from the Supreme Court.2 ■

1 Judge Cohn-Jubelirer authored a dissenting opinion unrelated to this issue.2 On February 3, the Commonwealth Court denied a PEDF application for rear-gument (see article below).

Court rejects PEDF request forrehearing in leasing decision

In a one-sentence order, the Commonwealth Court early thismonth denied a request from the Pennsylvania EnvironmentalDefense Foundation (PEDF) to reconsider the court’s deci-

sion on how revenue from oil and gas leasingin state forests canbe used.

In a near-unanimous decision, the Commonwealth Court hadruled on January 7 that the General Assembly acted within itsconstitutional authority by balancing budgets in recent years withfunds transferred from the Oil and Gas Lease Fund, a dedicatedaccount to be used by the Department of Conservation andNatural Resources (DCNR) for conservation, recreation andflood control (January PIOGA Press, page 8). The PEDF askedto reargue the case, stating that the court did not address thegroup’s central point: that the state failed to perform its dutyunder Article I, Section 27 of the Pennsylvania Constitution—otherwise known as the Environmental Rights Amendment.

“Although the Environmental Rights Amendment places anaffirmative duty on the Commonwealth to ‘prevent and remedythe degradation, diminution, or depletion of our public naturalresources’—i.e., to conserve and maintain, the EnvironmentalRights Amendment does not also expressly command that allrevenues derived from the sale or leasing of theCommonwealth’s natural resources must be funneled to thosepurposes and those purposes only,” Judge P. Kevin Brobsonwrote in January’s majority opinion.

On February 3, the Commonwealth Court issued an ordersimply saying that after considering the PEDF’s request forreconsideration, it is denied.

In a posting on its website made before the court turned asidethe request, the PEDF stated: “It is still PEDF’s intent to file anappeal with the Pennsylvania Supreme Court, but PEDF wants togive the Commonwealth Court a chance to correct the record oftheir [January 7] opinion before the appeal is filed.” ■

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Page 15: The PIOGA Press - Feburary 2015

February 2014 Page 15February 2015 Page 15

An article in the January PIOGA Press discusses the pro-liferation of so-called “community bill of rights” ordi-nances across the nation and PIOGA’s involvement in a

federal court case contesting such an ordinance in GrantTownship, Indiana County. Since that was written, a federaljudge has struck down as unconstitutional one of these ordi-nances, in Mora County, New Mexico.

Community bill of rights ordinances typically target a particu-lar industry or activity, stripping corporations of all rights grant-ed to “persons” unde r state and federal constitutions and pro-hibiting corporations from challenging the validity of the ordi-nance; bestowing personal “rights” on “natural communities andecosystems;” and invalidating state and federal permits and lawsthat are inconsistent with the ordinance.

The New Mexico ordinance, crafted by the Pennsylvania-based Community Environmental Legal Defense Fund (CELDF),bans drilling and hydraulic fracturing. However, in a 199-pageorder issued last month, U.S. District Court Judge JamesBrowning found the ordinance violated the U.S. Constitution byattempting to discard corporate rights protected by federal caselaw. The Mora County ordinance states that oil and gas compa-nies “shall not have the rights of ‘persons’ afforded by the UnitedStates and New Mexico Constitutions,” including First Amend -ment rights and due process. The judge also found the ordinanceviolates state law by banning practices that the state allows.

The ordinance, enacted in 2013, was challenged by SWEPI, asubsidiary of Royal Dutch Shell, and two private landowners.

Located in northeast New Mexico, Mora County has no activeoil and gas wells within its boundaries.

According to one report, the county may be on the hook forup to hundreds of thousands of dollars in legal fees. When theplaintiffs who challenged the county ordinance filed the case,they called for Mora County to pick up all court costs in thejudge ruled in their favor, according to the Watchdog.org.

Meanwhile, the CELDF is attempting to paint its New Mexicoloss as a win. In response to the court’s ruling, the organization’sexecutive director, Thomas Linzey, Esq., stated, “With this deci-sion, the court affirms what our communities already know, thatthe existing structure of law denies local, democratic self-gover-nance. The existing structure of law denies communities theauthority to protect themselves from fracking. The existingstructure of law denies communities the authority to protect theirwater and the natural environment.”

Linzey added, “As with communities in other states, NewMexico communities must grapple with the way that the law isconstructed by building a statewide movement that eventuallychanges the state constitution to recognize the people’s right toadopt laws like Mora’s.”

The CELDF is also behind the Grant Township ordinance inPennsylvania that bans disposal wells. The ordinance is beingchallenged by PIOGA member company Pennsylvania GeneralEnergy, which holds permits from the U.S. EnvironmentalProtection Agency and the Pennsylvania Department ofEnvironmental Protection for an underground injection controlwell. PIOGA has petitioned to intervene in the lawsuit. ■

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Page 16: The PIOGA Press - Feburary 2015

Page 16 The PIOGA Press

By Joyce Turkaly,Director, Natural Gas Market Development

Currently the U.S. has free trade agreements (FTA) with 20countries. Both free trade and non-free trade countries arebeing sought out as potential partners for liquefied natural

gas (LNG) export. The application process starts with theDepartment of Energy Office of Fossil Energy or (DOE/FE).DOE, acting under the authority of the Natural Gas Act, reviewstrade applications with free trade countries without “modificationor delay” and grants a license. While this is good news, the mar-ket is dictating a need for additional product to countries that theU.S. does not currently consider free trade countries.

In 2010, DOE began receiving applications from the lower 48states and responded by issuing conditional orders of approvalthat were contingent upon completion of an environmentalimpact statement as part of the National Environmental PolicyAct (NEPA) process. In August, 2014, DOE said it would act onLNG export applications to non-FTA counties only after theenvironmental review had been completed, suspending the priorpractice of issuing “conditional” orders. This new procedure hasan impact on how LNG projects are compiled and how theagency reviews them. Without the conditional approval, manyprojects have to secure the financing up front, without any indi-cation of a final order; whereas in the past, the conditionalapproval served as a better indicator of final approval.

An applicant must also seek authorization from the FederalEnergy Regulatory Commission (FERC). FERC is responsiblefor authorizing the siting and construction of onshore and near-

shore LNG import or export facilities under Section 3 of theNatural Gas Act. Because the construction and operation of afacility will have more impact than the import or export of theactual commodity, FERC is viewed as the lead agency (for pur-poses of complying with the NEPA 1969). FERC also retainsoversight once the facility is built and operating.

Non-FTA applications require DOE to post a notice of appli-cation in the Federal Register for comments, protest, andmotions to intervene and to evaluate the application to make apublic interest consistency determination. This last part aboutDOE’s evaluation of “what is in the public interest” and the time,expense and uncertainty of the NEPA process to enforce any sortof agency ownership of timeline has been heavily debated amongvarious stakeholders. The issue of delayed permitting is not any-thing new to the energy industry; however, given that many ofour legislative leaders would like to encourage a more aggressivetimeline on the approval process, new legislation is being intro-duced in both the House and Senate.

To date, the Energy Department has approved 10.56 Bcf/dayin exports to non-FTA countries. Utilizing federal EnergyInformation Administration ( EIA) data for comparison, U.S. nat-ural gas production is 71 Tcf/day and consumption is 26 Tcf/day.

“Exports would have a ‘marginal’ impact on U.S. natural gasprices while bringing economic gains,” said Adam Sieminski,head of the EIA, DOE’s statistics arm.

When taking into account all of the major shale plays,Pennsylvania has accounted for a 13.5 Tcf/day Y-O-Y increasewhen compared to 2013. It is estimated that by the end of 2016,U.S. production is expected to be 80 Tcf/day or more. For thoseof us monitoring production numbers from our state alone, onehas to wonder why the concern over exports. To put the currentapproved export numbers in perspective, this equates to non-FTAexport approval permits for 15 percent of overall U.S. natural gasproduction. A large majority of bi-directional pipelines will takeproduct from our region to markets abroad such as India,Norway and the Netherlands. Half of the world’s re-gas capacityis located in Asia, which accounts for about 71 percent of globalLNG demand with a combined capacity of around 50 percent formarkets in Japan and Korea.

Speeding up the processFiling a FERC application and receiving DOE approval has

been known to take anywhere from 18 to 36 months; however,once approved, additional “trains” for incremental volumes seemto have less of an issue. Pre-filed in July 2010, the first NorthAmerican LNG export terminal to receive final FERC approval

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Page 17: The PIOGA Press - Feburary 2015

February 2014 Page 17February 2015 Page 17

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22 months later was Cheniere Energy’s Sabine Pass, Louisiana,liquefaction project. Currently under construction, this facility isperhaps the largest industrial project in the U.S., with a price tagof $19 billion and the largest permitted capacity of 2.76 Bcf/d.At a recent event, Corey Grindal, spokesperson for the project,said testing of the facility will begin in Q2 2015. Other projectsapproved and under construction are Sempra-Cameron LNGHackberry, Louisiana; Freeport LNG Dev/Freeport LNG expan-sion and liquefaction in Freeport, Texas; Lake Charles ExportLLC, Lake Charles, Louisiana; and Dominion Cove Point LNGin Cover Point, Maryland.

Twenty-two other applications filed in 2010 for natural gasexport to non-free trade countries are in some stage of review.There are 25 LNG importing countries in Europe, Asia, SouthAmerica, Central America, North America and the Middle East,up from 17 in 2007. Developing countries, including Poland,Croatia, Bangladesh, Jamaica, Colombia, Panama, El Salvador,Costa Rica and Lebanon, among others, have plans to enter theglobal LNG trade by building LNG terminals as well.

For more information on the status of approved, proposed andpotential projects, please see www.ferc.gov/industries/gas/indus-act/lng/lng-approved.pdf

While natural gas producers view exports as a way to earnhigher prices than are available in domestic markets, some legis-lators are viewing this new market potential as a way to helpeastern European countries avoid having to buy gas from Russia.Pennsylvania Congressman Tom Marino of Lycoming Countywas invited to speak at January’s Williamsport Chamber break-fast. As a member of the NATO parliamentary alliance, Marinotravels to Europe four times a year to meet with the 27 otherNATO countries, where they discuss many issues, with economicissues being one. It was here where Marino first heard of theinterest in purchasing gas from the U.S. rather than Russia.

“OPEC knows Pennsylvania means Marcellus Shale,” he said,noting that one OPEC member commented to him directly bysaying, “Pennsylvania and the United States could be the nextSaudi Arabia of the 21st century, but we don’t believe you havethe backbone to do it.”

This “game on” comment may have been the impetus behindMarino’s bipartisan legislation called the RAPID Act.Reintroduced this session as H.R.348, the Responsibly andProfessionally Invigorating Development Act is intended toreform and expedite the approval and completion of critical ener-gy and infrastructure projects.

RAPID was passed by the House in March 2014, but did notmake it past the desk of then-Senate Majority Leader HarryReid. Recognizing that permits can be handed out in states with-in a year, this piece of legislation reviews permitting underNEPA that involves the courts. All federal actions interpreted bythe courts that would include privately financed projects likepipelines or projects would stand to benefit. Recognizing thatpipeline and end-use projects will only help Pennsylvania’s eco-nomic outlook, Congressman Marino’s legislation codifies con-cepts, definitions and best practices for NEPA to ensure the fed-eral review and permitting process is efficient and transparent.Stressing as a “key” part of the act, lead agencies will manageenvironmental reviews from start to finish. Citing that federal,state and local agencies have not been very effective in workingwith one another, this legislation will place the lead agency incharge of the timeline, to manage environmental reviews includ-

ing inviting and designating participating cooperating agenciesand setting deadlines—which are important. The legislation alsoestablishes a 180-day statute of limitations to bring suit.

The RAPID Act would ensure all relevant agencies can partic-ipate—but if an agency chooses not to participate, then it cannotoppose the environmental document or project, thereby eliminat-ing the ability to stall or oppose the project based on other evi-dence. Agencies can only comment on issues within their juris-diction and the lead agency can adopt existing relevant docu-ments (if something has been done in the past several years andis considered relevant under state law that satisfies or exceedsNEPA standards and applies to a specific project); can skip thereview and scientific study. On the environmental assessment themaximum timeline is 36 months for environmental impact state-ment, although Marino believes that time frame can be trimmed.In order to get this done, audience members were encouraged tosupport this bill.

Closing, he remarked that the eastern Marcellus needs themarkets for dry gas to find its way to Cove Point, Maryland,where it will be liquefied and exported to markets in Asia andEurope.

“Business is going to have to get involved,” he urged. Congressman Bill Johnson of Ohio sponsored a bill entitled

the “LNG Permitting and Certainty and Transparency Act” (H.R.351) that now incorporates RAPID as part of his proposed legis-lation. On January 28, the House approved (277-133) this bill tofurther expedite the approval process. Even President Obama hastalked about permitting and streamlining reform. For more infor-mation on H.R. 351, visit billjohnson.house.gov/legislation/cosponsoredbills.htm. ■

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The data show below comes from the Department ofEnvironmental Protection. A variety of interactive reports are

OPERATOR WELLS SPUD API # COUNTY MUNICIPALITY OPERATOR WELLS SPUD API # COUNTY MUNICIPALITY

available at www.portal.state.pa.us/portal/server.pt/community/oil_and_gas_reports/20297.

The table is sorted by operator and lists the total wells report-ed as drilled last month. Spud is the date drilling began at a wellsite. The API number is the drilling permit number issued to thewell operator. An asterisk (*) after the API number indicates anunconventional well.

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February 2014 Page 21February 2015 Page 21

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February 2015 Page 23

1/19/15 083-56659 McKean Wetmore Twp1/26/15 083-56660 McKean Wetmore Twp

Range Resources Appalachia 10 1/2/15 081-21526* Lycoming Mifflin Twp1/2/15 081-21515* Lycoming Mifflin Twp1/27/15 125-27437* Washington Canton Twp1/27/15 125-27381* Washington Canton Twp1/27/15 125-27580* Washington Canton Twp1/27/15 125-27404* Washington Canton Twp1/16/15 125-27397* Washington Somerset Twp1/16/15 125-27398* Washington Somerset Twp1/16/15 125-27395* Washington Somerset Twp1/16/15 125-27399* Washington Somerset Twp

RE Gas Dev LLC 4 1/5/15 019-22348* Butler Muddycreek Twp1/6/15 019-22349* Butler Muddycreek Twp1/28/15 019-22377* Butler Penn Twp1/28/15 019-22378* Butler Penn Twp

Seneca Resources Corp 4 1/5/15 047-24902* Elk Jones Twp1/7/15 047-24901* Elk Jones Twp1/14/15 047-24900* Elk Jones Twp1/22/15 047-24905* Elk Jones Twp

Southwestern Energy Prod Co 17 1/14/15 115-21926* Susquehanna Franklin Twp1/2/15 115-21863* Susquehanna Great Bend Twp1/2/15 115-21864* Susquehanna Great Bend Twp1/3/15 115-21845* Susquehanna Great Bend Twp

1/24/15 115-21445* Susquehanna Jackson Twp1/31/15 115-21446* Susquehanna Jackson Twp1/31/15 115-21927* Susquehanna Jackson Twp1/31/15 115-21928* Susquehanna Jackson Twp1/12/15 115-21925* Susquehanna New Milford Twp1/12/15 115-21860* Susquehanna New Milford Twp1/27/15 115-21414* Susquehanna New Milford Twp1/27/15 115-21415* Susquehanna New Milford Twp1/27/15 115-21416* Susquehanna New Milford Twp1/27/15 115-21417* Susquehanna New Milford Twp1/27/15 115-21418* Susquehanna New Milford Twp1/27/15 115-21940* Susquehanna New Milford Twp1/26/15 125-27411* Washington Donegal Twp

Trimont Energy LLC 1 1/12/15 121-45782 Venango Allegheny TwpVantage Energy Appalachia II 2 1/8/15 059-26742* Greene Franklin Twp

1/8/15 059-26743* Greene Franklin TwpBrooks A Whilton 1 1/27/15 123-47545 Warren Mead TwpWilmoth Interests Inc 3 1/14/15 083-56634 McKean Wetmore Twp

1/21/15 083-56636 McKean Wetmore Twp1/30/15 083-56635 McKean Wetmore Twp

Xite Energy Inc 2 1/5/15 121-45647 Venango Cornplanter Twp1/22/15 121-45649 Venango Cornplanter Twp

XTO Energy Inc 1 1/19/15 019-22352 Butler Donegal Twp

OPERATOR WELLS SPUD API # COUNTY MUNICIPALITY OPERATOR WELLS SPUD API # COUNTY MUNICIPALITY

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A new state legislative session begins

In the last legislative session, PIOGA monitored more than200 bills, 65 of which were considered high priority. Nowa new two-year session of the Pennsylvania General

Assembly has begun, and based on what we are seeing so far,it appears PIOGA again will be very active looking out forthe industry’s interests in Harrisburg.

PIOGA’s biggest challenge will be fending off attempts toimpose a severance tax on unconventional gas. Even though anumber of lawmakers have indicated they will introduce billsin the weeks ahead—and Governor Tom Wolf campaigned onthe promise of a 5-percent tax on gas production that wouldbe used to help fund education—the real push for a severance

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February 2014 Page 25February 2015 Page 25

tax is most likely to come at budget time late this spring.In December, lawmakers began filing co-sponsorship memos,

which are essentially trial balloons to attract support in the formof additional sponsors for legislation they hope to introduce.Some of the co-sponsorship memos have advocated severancetaxes, while others would:

• Require that new Class IID disposal wells be set back atleast 1,000 feet from drinking water sources and occupied struc-tures.

• Create an impact fee on pipeline construction.• Mandate that pipelines be made of domestically manufac-

tured steel.• Require air quality monitoring systems near all compressor

stations, processing plants and water impoundments.• Create an exemption from any severance tax for gas sold to

a manufacturing facility within 5 miles of the production site.These and other industry-related bills will end up being for-

mally introduced in the coming weeks and months. Whether theywill advance beyond their initial committee assignment dependson many factors. Without broad bipartisan backing, legislationintroduced by Democrats probably will not succeed—and neitherwill many Republican-sponsored bills unless they have the sup-port of their leadership. PIOGA continually monitors bill intro-ductions and concentrates efforts to support or oppose those pro-posals that have a strong chance of passage.

Three industry-related Senate bills already have seen somemovement. The Senate Environmental Resources & EnergyCommittee on January 21 approved Senate Bills 147, 148 and279—all proposals which had been offered last session.

SB 147, sponsored by the committee’s majority chairman,

Gene Yaw (R-Lycoming County), allows royalty owners theauthority to inspect producers’ records to verify the accuracy ofroyalty payments. SB 148, another Yaw bill, prohibits producersfrom retaliating against a royalty owner by terminating a lease orstopping development because the royalty owner questioned theaccuracy of payments.

Sponsored by Senator Scott Hutchinson (R-Venango), SB 279creates the Penn Grade Crude Development Advisory Council,which would make recommendations regarding Department ofEnvironmental Protection regulations and policies that impact theconventional oil and gas industry, promote the long-term viabili-ty of the conventional industry, and develop a joint workinggroup with the department to explore and develop an environ-mentally responsible and economically viable option for manag-ing produced water.

PIOGA strongly supports the Hutchinson bill as a means ofhelping struggling conventional producers who have been hithard by both low product prices and onerous regulations. Thecouncil would include two PIOGA members on its roster.

On January 28, SB 147 and 148 were approved unanimouslyby the full Senate and then were referred to the HouseEnvironmental Resources & Energy Committee. As of this writ-ing, SB 279 had not been brought before the full Senate.

Other billsPIOGA also is actively watching the legislation shown below.

At this writing, none has advanced beyond being assigned to acommittee.

SB 53, sponsored by Senator Stewart Greenleaf (R-Montgomery), requires producers, prior to the execution of any

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gas mineral rights lease agreement, to disclose to the landownerthe potential liability he may encounter by allowing gas drillingon his property. Any gas leasing agreement also must contain anindemnification provision that protects the landowner from anyand all liability.

SB 64 (Greenleaf) allocates $3 million annually from uncon-ventional well impact fee revenue to be used by the Departmentof Health to determine if health services are adequate in areaswhere drilling occurs, provide health care providers with trainingin occupational and environmental medicine, and conductresearch on the effects of air quality where drilling occurs.

SB 145 (Yaw), requires new leases for unconventional reser-voirs to include a Pugh clause to define, following the primaryportion of the lease, what happens to the portion of the acreage aproperty owner leased that does not either contain a well or isnot included within a pool or unit.

SB 257 (Senator Wayne Fontana, D-Allegheny) requires DEPto provide private water supply owners with the complete resultsof all water testing conducted related to oil and gas activity. Thedepartment also would be directed to publish water testingresults online in an aggregate form that protects the water supplyowners’ confidentiality.

SB 347 (Senator John Yudichak, D-Carbon) gives DEP addi-tional time to conduct investigations into suspected water con-tamination by gas migration; requires DEP to inspect unconven-tional well sites at least annually once the well is in production;requires the department to maintain records on the generation,transportation and disposal of drill cuttings; requires DEP topublish lists of probable causes of water supply contamination ifsupported by credible evidence; and requires that well inspection

reports include the written comments of the inspector as theyrelate to the well site.

SB 367 (Senator Donald White, R-Indiana) requires the oper-ators of all natural gas gathering lines to participate in the PAOne Call system.

SB 375 (Senate President Pro Tem Joe Scarnati, R- Jefferson)creates a nine-member advisory panel that would meet at leasttwice a year to consult with experts to analyze the health effectsof natural gas extraction. In 2011, former Governor TomCorbett’s Marcellus Shale Advisory Commission recommendedthat the state monitor public health impacts from drilling, but thelegislature never allocated funding for it.

SB 395 (Senator James Brewster, D-Allegheny) creates a sev-erance tax on top of the current unconventional well impact feeso that the cumulative tax rate on natural gas production wouldbe 5 percent. The new revenue from the increased levy would beused to provide additional state funding to public school districts.

HB 67 (Representative Robert Godshall, R-Montgomery)amends the Dormant Oil and Gas Act to provide that an interestin oil or gas is deemed abandoned after 20 years in the absenceof the issuance of a drilling permit, production of oil or gas, oruse for underground gas storage. The legislation provides for theprotection of oil and gas interests from abandonment if the hold-er of the subsurface rights files notice in the county’s recorder ofdeeds office stating the owner’s desire to preserve the interest.

HB 151 (Representative W. Curtis Thomas, D-Philadelphia)requires that pipeline operators that purchase or obtain easementsfor public land, agricultural easements or permanently preservedland for new or expanded pipelines provide an equivalent amountof land to the county for recreational use. After completion of apipeline project, the operator must ensure that stormwater runoffdoes not exceed the runoff amounts that existed prior to the proj-ect.

HB 252 (Representative Karen Boback, R-Wyoming) createsa registry is to evaluate the potential public health impacts asso-ciated with drilling in the Marcellus Shale for individuals wholive in close proximity to production sites. The initiative wouldbe funded by an annual allocation of $1 million from impact feerevenues.

Research and commentThis is an active time for bill introductions, so the list above

should not be considered comprehensive. The Members sectionof PIOGA’s website contains a list of PIOGA’s high-prioritybills, updated on a weekly basis while the legislature is in ses-sion (please contact us if you need the member password toaccess the report). You can find the status of any piece of legisla-tion at www.legis.state.pa.us/cfdocs/legis/home/bills.

PIOGA’s Legislative Committee is interested in hearing frommembers who have concerns about the potential impact of legis-lation on their business. You can provide input to the committeechairs, Ben Wallace of Penneco Oil Company ([email protected]) and Holly Christie of Steptoe & Johnson([email protected]). ■

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February 2014 Page 27February 2015 Page 27

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Meet PIOGA’s new board member: Joy M. Ruff – Dawood Engineering

Joy M. Ruff has over 20 yearsof experience in municipalplanning and community

development. She is a member ofthe American Institute of CertifiedPlanners and is active in thePennsylvania Chapter of theAmerican Planning Association.Over the course of her career, Joyhas specialized in public involve-ment and government relations.

She works for DawoodEngineering as the Director ofPlanning and CommunityRelations. Founded in 1992, Dawood Engineering provides con-sulting services for a wide range of industries encompassing landdevelopment, transportation, and oil and gas. Joy manages clientrelationships across public and private sectors and serves as thecompany’s representative to various oil and gas associations. Herengagement with industry organizations keeps her apprised ofregulatory and legislative activities that affect Dawood’s energysector clients.

As Dawood’s representative to the PIOGA Board ofDirectors, Joy offers a proven track record of developing suc-cessful communication strategies and outreach campaigns.

“Many people are suggesting that this year will be pivotal tothe oil and gas industry in Pennsylvania—for conventional andunconventional producers and midstream operators,” she says. “Ihope to strengthen our approach and organize around the collec-tive goal to protect the many businesses engaged in the oil andgas supply chain.”

Joy is active on the PIOGA Legislative Committee. Sincejoining the committee, she has led a strategic planning initiativeto streamline the legislative review process and deliver a legisla-tive engagement plan that will inform PIOGA members ofemerging issues and influence decision makers in Harrisburg.

Joy began working with the oil and gas industry when shewas hired as a community outreach manager for the MarcellusShale Coalition (MSC) in 2011. While working for the MSC, shemade significant contributions to educate the public about the oiland gas industry and to help companies comply with an ever-changing regulatory environment. Joy developed and implement-ed a statewide education campaign to heighten awareness of theeconomic benefits of responsible shale development to localcommunities across Pennsylvania, which resulted in significantmedia coverage and increased knowledge of the Act 13 impactfee. She worked closely with unconventional operators and serv-ice companies to prepare formal comments to government agen-cies and advocacy support materials promoting oil and gas devel-opment in Pennsylvania.

Joy has extensive experience with local governments, whichcomes from working as both a private planning consultant andprofessional planner for the Pennsylvania Department ofCommunity and Economic Development. Working for theCommonwealth, Joy administered the Land Use Planning andTechnical Assistance Program for 24 counties in Western

Pennsylvania. Her strong local government knowledge comesfrom several years of providing technical assistance for planningand implementation of economic and community developmentactivities. As a planning consultant, Joy has authored numerousplanning studies including multi-county, county and multi-municipal comprehensive plans.

Joy contributes a significant amount of time to the MarcellusShale Coalition, leading the Land Affairs work group. Thisdiverse group includes MSC member companies that work tobuild relationships with governmental, non-governmental, andother stakeholder organizations that have missions of environ-mental stewardship, natural resource conservation or expansionof species and supporting habitats. In this role, she is responsiblefor organizing educational forums with industry and conservationstakeholders.

Joy is adept at navigating the divide between business inter-ests, the regulatory environment and the public. “Until the adventof Marcellus, I thought the most controversial meetings werepublic hearings for zoning ordinances,” she says. “However, afterthe last several years and countless public hearings, open houseforums and work group meetings, I understand that there arecomplex forces at work to thwart the production of oil and gas inPennsylvania. Armed with this experience, I hope to be aresource to PIOGA and help build partnerships at local, countyand state levels.” ■

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Mama says,‘You’re special’?These services will help you to position yourcompany as an ‘Opportunity Maker’ in the eyesof current and prospective talent

By Aaron KahnWealth Management Strategies, Inc.

What makes you special? Specifically, how have youpositioned your company to stand out in the eyes oftalent who will help you fulfill and evolve your mis-

sion better than the competition? The Pennsylvania Departmentof Labor & Industry reported in December that employment incore industries related to Marcellus Shale production inPennsylvania increased 96.7 percent from June 2010 throughJune 2014. As a result, the duty of competing for the industry’smost qualified talent has fallen on management teams and the C-suite. So as a business owner, what are you to do? Simply put:Commit to positioning your company as an Opportunity Maker.

By merely existing, you create opportunities on macro andmicro scales. Your presence affects the oil and gas industry as awhole, the communities where you are headquartered and oper-ate, but most importantly, in the personal and professional livesof your employees. This group of people relies on you to buildand maintain a stage that will enable them to perform at theirbest. The infrastructure you provide your employees is one of thephysical elements of being an Opportunity Maker, but the largely

intangible factors will ultimately set your company apart. As a business owner, you have the capacity to make benefits

available to your employees, which will be of exponentiallygreater reward to the company. The tech sector, for example, isfamed for innovative benefits afforded to its employees. Perkslike napping pods, in-house dry-cleaning and a gourmet cafeteriafulfill a dual function. Primarily, these atypical offerings attractthe attention of applicants. While stirring buzz in the talent poolis significant, such perks serve a much higher purpose, which isto eliminate peripheral concerns from impeding the employee’sfocus at work.

That is the key. Opportunity Makers generate success forthemselves by enabling their workforce to enthusiastically oper-ate at their peak, on a consistent basis. When your company cre-ates a job, you are fulfilling only the first step. In the eight-plushours that individuals will be completing their assigned taskseach day, what external distractions might be hindering their bestefforts and congruently reducing the return on your investment inthese employees?

A 2014 study by professional firm Towers Watson, found that70 percent of the 32,000 employees surveyed globally “felt theirorganization should understand them to the same degree they areexpected to understand customers.” Your customers chose towork with your company because they perceived an opportunityto improve their situation. Current and prospective employeeshave, or will have, the same mindset—so what services are youoffering to the market place of talent?

ConsultationPut yourself in the shoes of Tom Cruise’s character from the

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1996 film Jerry Maguire when he pleads with Cuba GoodingJr.’s character to, “Help me help you!” That level of concern anddesire needs to be communicated to your employees, so that theyknow their plights will be addressed if the company is madeaware. If you go so far as to make experts available to employ-ees, you are creating an opportunity for the employee to improvehis or her life outside of work, and with that comes an elevatedloyalty to your company.

When you launch an employer-sponsored wellness program,you are delivering opportunities to your employees that will helpto improve their lives outside of work hours. The goal is to liber-ate external distractions and enable your teams to put forth theirbest effort at work. Wellness program topics can vary widely, butoften encompass at least one of the following three categories:

1. Physical. This may be the most obvious type of wellnessprogram, but it is also the most extensive. With the advent of somany new ways to foster and maintain a healthy lifestyle,employers have near-limitless ways to encourage physical well-ness among their staff. To generate the strongest attendance, sur-vey your employees about the areas of physical wellness thatconcern them the most. If your response is low, try starting smalland then let the program develop naturally. For example, one-hour “lunch & learn” sessions from nutritionists can be as littleas $150. If these sessions are received well, consider organizinga yoga or group fitness class at the office.

2. Financial. Advice about money is so widely availabletoday that most individuals don’t know where to start. If theyeventually find a starting point, they often have limited avenuesto verify the quality and accuracy of the information. Worse yet,the content your employees read may lack any suitability as itrelates to their unique situation. For company retirement plansthat Wealth Management Strategies, Inc. manages, the firm’sadvisors (including myself) meet privately with each plan partici-pant, annually. By offering as little as one hour per year to eachemployee, feedback from the owners is that productivity is high-er, because money is a reduced concern among the workforce.

3. Legal. Just as an individual’s physical or financial livesmight be in disrepair, legal troubles can often be the cause ofprolonged distraction. What’s more, the hourly expense of con-sulting with an attorney may dissuade your employees fromseeking an opinion on a relatively minor issue, which then quick-ly snowballs. Some companies have been hesitant to make legalconsultation available to employees, for fear that the companywill become entangled in each individual’s legal trouble. By con-trast, you are purely making an objective and qualified expertavailable to offer guidance so that your employees are not sad-dled with navigating the legal system entirely alone.

MotivationEmployees need to take ownership of their work and feel

invested in the success of the company. There are as many formsof incentives as there are types of employees, so make yourworkforce part of the design process for your motivation pro-gram. Their feedback will help to jumpstart your list of possibleenticements while homing in on what’s most important to thepeople it’s meant to excite. One of the most unique incentiveprograms comes in the form of discretionary contributions to401(k) plans.

A discretionary contribution to a 401(k) plan is just oneoption of many, but its outstanding quality is the flexibility

afforded to the employer while making the employee’s dailyefforts a tangible part of the company’s success. Think of it likea bonus program in which the money goes directly into youremployee’s 401(k) accounts. When considering a discretionarycontribution too, make sure that employees know the thresholdthat the company must meet for the contribution to be consid-ered.

At the end of the year, the employer has the option to decideif a contribution to employees’ 401(k) accounts should be madeand if so, how much that contribution will be. If a contribution isultimately made, up to 25 percent of an employee’s (andowner’s) eligible compensation is deductible from companyincome. This is not automatically permitted in all 401(k) plans,however. Discretionary contributions must be elected in the planadoption agreement, where it will be stipulated whether allemployees receive this contribution or just those who activelyparticipate in the 401(k) plan.

To add an elevated level of functionality to the 401(k) plan,attach a vesting schedule to your contributions. This schedule isused to create loyalty throughout your workforce and penalizesthe employee for leaving before becoming 100 percent vested inthe company contributions. Vesting schedules for retirementplans come in two forms—cliff or graded—and should be dis-cussed with your plan administrator and advisor.

CompensationNo matter how appealing you make a job, if your employees

feel underpaid, their attention will be fixated on meeting orexceeding the industry average. To provide reasonable compen-sation, you need to explore both cash-based compensation and

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benefits. Competing in the sphere of cash-based compensation isdependent upon what the company can afford first and then com-paring that budget with a range the industry pays as a whole.

The other half of the pie is the design of your benefits pack-age, which can be decidedly more complicated. In general, bene-fits fall into one of two categories: health benefits or other fringebenefits. Luckily, with all of this complication comes opportuni-ties for tax deductions for the company. However, the deductibil-ity of benefits varies widely, so be sure to include your CPA inthe process.

By taking the time to learn about your employees and what ismost important to them, you will become an Opportunity Makerorganically. You will see a renewed level of enthusiasm and dedi-cation from your team, while attracting new talent who will con-tinue to bring out the best in your company.

So, let’s think again about what makes your company special.Well, if you’re reading this article, you are able to operate suc-cessfully in a heavily competitive space. You also had the fore-sight to establish a business in an industry that is helping to fos-ter America’s energy independence. An outside observer will rec-ognize these accomplishments in a heartbeat—but what about thepeople who help to nurture your success? ■

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Safety Committee CornerSafety Committee CornerWhat you need to know aboutOSHA’s intensifying focus onfracking operationsBy Cressinda “Chris” D. Schlag, Esq.Burns White LLC

Over the past couple of years, the Occupational Health andSafety Administration has intensified its focus on the oiland gas industry, leading to several proposals for new

regulations and the publication of multiple bulletins specific toperceived hazards in oil and gas operations. OSHA’s most recentpublication comes in the form of a guideline, titled HydraulicFracturing and Flowback Hazards Other than Respirable Silica(www.osha.gov/Publications/OSHA3763.pdf), which was draftedin the form of an educational bulletin.

The guideline and its appendices emphasize that the agencyhas shifted its focus to oil and gas operations for the primarypurpose of reducing reportable injuries and fatalities, which arebelieved by OSHA to occur in the oil and gas extraction industryat a higher rate than most of the U.S. general industry.

While the guideline clearly states that its purpose is informa-tional and is not a standard or regulation, the guideline then pro-ceeds to warn employers that they can be cited under the GeneralDuty Clause for failing to adequately protect against knownindustry hazards. An employer could therefore be cited for fail-ing to protect against one of the hazards identified by the guide-line under the General Duty Clause if the employer failed to takereasonable steps to prevent or abate the hazard.

After identifying primary tasks and issues associated withhydraulic fracturing and flowback operations, the guide empha-sizes hazards OSHA has identified as being present during on-

site transportation of materials, rigging up and rigging down pro-cedures, mixing and injecting fracking fluids, flowback opera-tions, and operations involving hydrogen sulfide and volatileorganic compounds. The guideline then proceeds to suggest “pre-vention strategies” or methods for controlling OSHA’s identifiedhazards.

Although the guideline is advisory in nature and does not con-stitute a regulatory standard, it clearly identifies the hazards thatOSHA will be looking for during oil and gas site inspections.OSHA inspectors may also point to the publication as a form ofnotice of oil and gas industry recognized hazards, such thatemployers will be expected to have sufficiently protected theiremployees against these hazards during oil and gas operations.Employers in the oil and gas industry should therefore take timeto review OSHA’s guideline as well as their own workplace poli-cies, practices, and training to ensure that any potential liabilitiesrelated to oil and gas operations are minimized. ■

For more information on OSHA’s guideline or regulatoryrequirements specific to your business, contact any member ofthe Burns White Occupational Safety and Health or Energyteams at www.burnswhite.com.

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HGA is a multi-disciplined project management, engineer-ing, pipeline services and staffing firm providing professionalservices to an extensive portfolio of customers throughoutnumerous industries. HGA has expanded its offices to keep upwith industry demands and opened its doors to thePennsylvania area in 2010. Ranked a “Fastest Growing PrivateFirm” by Inc.5000, HGA now has 14 locations and a staff ofover 400 to provide full-service offerings to clients worldwide.

The Pennsylvania office developed to provide local projectmanagement and technical resources to HGA’s oil and gasprojects in the region. Our team has the expertise and experi-ence gained from extensive work in the Marcellus, Utica andother shale plays throughout the United States.

HGA’s professionals have years of experience in upstream,midstream and transmission industries. Whether you’re lookingto engineer a new oil, gas or liquids project, or to expand anexisting system, HGA methods and practices yield accurate,efficient, and reliable results that reduce client costs and sched-ules.

Our ability to provide services from inception through com-missioning has made us a leader in the oil and gas industry. AtHGA, we recognize that the true measure of value in a projectis realized in the field during the construction phase. Our atten-tion to design efforts focus on constructability, resulting infewer contractor change orders and meeting deadlines.

Our engineers, drafters, designers, management, supportgroups, and our ability to place candidates, give us an edgeabove the competition. Among our services are:Industry projects

• Compression• Pipelines• Treating & processing• M&R stations• Well site development

Treating & processing• Cryo plants• Dehy units• Fractionation plants• Condensate stabilization • Hydraulic modeling / process models

Pipeline• ROW & permitting• Surveying & mapping• Engineering & design• Construction management• Inspection services

Multi-disciplined engineering• Mechanical & piping• Electrical power• Instrumentation & controls• Civil & structural• Chemical process

Staffing services• Direct hire placements: engineering, design, project

managers• Contract hires: pipeline/facility inspectors, construction

managers, project engineersAs we continue to grow in the Marcellus and Utica region,

we seek to build long-term relationships by listening to ourclients’ needs, leveraging our experience and delivering on ourcommitments. Check out our website at www.hga-llc.com orcall 724-884-2800.

PIOGA Member Profile

Just as PIOGA is a member-driven association, our monthlynewsletter, The PIOGA Press, is a member-directed publica-tion. We strive to bring you news important to the industry

as a whole and your business in particular. Much of that news deals with the trade association’s tradition-

al role as advocate for its membership in the government arena,which translates to reporting on legislation, regulations and legaldevelopments. We also regularly include articles on market-relat-ed matters (especially those related to increased use of naturalgas), education and public relations, and safety—all of which areareas that PIOGA committees, the Board of Directors and mem-

bers have told us are important to them. Other types of articlesinclude news about PIOGA events and activities, industry-orient-ed material and member news.

The bulk of the content in The PIOGA Press is either writtenby staff or provided by a member, but we certainly welcome arti-cles supplied by members. If you are interested in submittingarticles for the newsletter, here are some guidelines.

Industry-oriented topicsYou or your company likely has expertise in a particular

aspect of our industry. Are you involved in an innovative project?Can you shed light on an important legal development or provide

Member submissions to The PIOGA Press

Page 33: The PIOGA Press - Feburary 2015

February 2015 Page 33

Pittsburgh 412.497.6000

hdrinc.com

Bridging the gap between idea + achievement

advice on regulatory compliance? Is there something you aredoing that can help other companies improve their efficienciesand effectiveness? We would be glad to have your share thatknowledge with the membership.

Please contact us with your idea before submitting an article.While it’s fine to highlight a particular process or tell why onetype of product may work better than another, we are not inter-ested in articles that are thinly veiled advertising or productpitches. It’s also a good idea to review past issues of the newslet-ter (www.pioga.org/resources/newsletter) to ensure your topic isnot one we have covered recently.

PIOGA Member ProfilesThe PIOGA Member Profile section is intended to introduce

your company and tell other members what you offer toPennsylvania’s oil and gas industry. Please follow these guide-lines:

• Include a brief history of your company. When and wherewas it founded, and by whom? Is the company new to the oil andgas industry in general or to Pennsylvania?

• Describe the products and services you offer specifically forthe oil and gas industry. Do you have a product in particular thatsets your company apart from the competition?

• If applicable, tell how the business been positively impactedby Pennsylvania’s oil and gas industry Have you expanded,added employees or opened new locations?

• Include a website address and/or phone number so readerscan learn more.

• Your submission may be a maximum of 400-450 words andshould be provided as a Word document. Use minimal format-ting—bold and italic fonts are OK, as are bulleted lists.

• Include your company logo or a photo. Images must behigh-resolution (300 dots/pixels per inch or higher) and in anygraphics format. Please include identifications for any people orproducts in a photo. Send image files separately, not embeddedin your document.

This is a free service to our member companies and publish-ing dates are at the discretion of PIOGA. Additionally, your sub-mission is subject to editing for length, clarity, style and appro-priateness.

Member newsWe accept submissions of news releases from PIOGA mem-

ber companies regarding new products or services, new facilities,expansions, open houses, promotions and hirings, and similardevelopments. The news must apply to the company’sPennsylvania operations and products/services for use in the oiland gas industry. Personnel items must be for Pennsylvania-based employees or whose territory includes Pennsylvania,except in the case of top company officers. All such items areused in the newsletter on a space-available basis and are subjectto editing.

Contact information and deadlinesAll inquiries and submissions should be directed to Matt

Benson at 814-778-2291 or [email protected]. The deadline isalways the business day closest to the first of the month; howev-er, if you are interested in submitting an article other than aPIOGA Profile or news release, please contact Matt in advanceof the deadline to discuss your topic. ■

PIOGA Member News

Parno joins Capozzi Adler

After a distinguished career as Oil and Gas ComplianceCoordinator for the Department of EnvironmentalProtection and Chief Deputy for the attorney general's

Environmental Crimes Section, Glenn A. Parno has joined thelaw firm of Capozzi Alder, P.C. With 25 years of litigation expe-rience, he has handled complex and high-profile environmentalcases involving companies such as ExxonMobil, Chevron, RangeResources, Merck, Norfolk Southern, Waste Management,Trinity Industries and York International. Parno’s practice focus-es on environmental litigation; Marcellus Shale-related compli-ance and enforcement issues; white collar crimes involving cor-rupt organizations, fraud, corporate malfeasance, money launder-ing and public corruption; government investigations; corporaterisk management; and regulatory compliance.

Chesapeake Utilities acquiring Gatherco

Chesapeake Utilities Corporation has entered into a mergeragreement with Gatherco, Inc. An infrastructure company pro-viding midstream services, Gatherco will merge into AspireEnergy of Ohio, LLC, a wholly owned subsidiary of ChesapeakeUtilities. Gatherco’s assets include 16 gathering systems andover 2,000 miles of pipelines in central and eastern Ohio.Gatherco provides gathering and natural gas liquids processingservices to more than 300 producers and supplies natural gas toover 6,000 customers in Ohio through the Consumers GasCooperative. Chesapeake Utilities is a diversified energy compa-ny serving 225,000 customers with gas, electric and propane. ■

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Page 34 The PIOGA Press

Wolf nominees: Continued from page 1

from drilling activity that in Wyoming has seen ozone levelsexceed what people in Los Angeles and other major citieswheeze through on their worst pollution days. Damage to thehunting, fishing and outdoor recreation opportunities that inmany ways define Pennsylvania. The long-term, cumulative dam-age from the many tens of thousands of wells that will be drilledand thousands of miles of pipeline and roadways that will cutacross two-thirds of Pennsylvania.”

Wolf’s choice to head DCNR is Cindy Dunn, president andchief executive officer for PennFuture. She previously was aDCNR deputy secretary, where she led the department’sConservation Landscape program, the Bureau of Recreation andConservation, and the Office of Communications, Education andPartnerships. Prior to joining DCNR, Dunn served as the execu-tive director of Audubon Pennsylvania and was the Pennsylvaniaprogram director for the Alliance for the Chesapeake Bay. Dunnwas also the director of community relations during the Ridgeadministration when the agency was formed. She holds a mas-ter’s in biology from Shippensburg University.

In an April 2014 news release reacting to the release ofDCNR’s report on shale-gas activity on state forest lands, Dunnsaid: “We remain unequivocally opposed to additional leasing ofour state parks and forests for natural gas drilling. It’s time weput the brakes on runaway drilling—the gas is under our land

and it’s not going anywhere. We owe it to the citizens of theCommonwealth to more fully understand the impacts of naturalgas drilling before we turn special places into industrial zones.The suggestion that this industrial activity can be ‘carefully man-aged’ provides scant comfort to Pennsylvanians who frequentPenn’s Woods. Carefully managed industrialization is still indus-trialization, so the need for a moratorium on leasing of stateforests and parks to drillers remains.”

Announcing the nominations, Wolf offered this statement:“Pennsylvania must take better advantage of its energy

resources, such as the Marcellus Shale, to jump-start the newenergy economy, energize our manufacturing sector and modern-ize our infrastructure. The natural gas industry must be a keycomponent of any plan for Pennsylvania’s future, but we alsomust ensure that we take advantage of this resource in a way thatbenefits all Pennsylvanians, safeguards the health of our citizens,and protects our water and environment. John Quigley has theexperience to lead the Department of Environmental Protection,and working with him, I know we can develop this industry forthe future while also protecting our environment and bringinggreater oversight and transparency to the process.

“Pennsylvania’s state parks and state forests are unique assetsthat should be better preserved, protected and utilized by our citi-zens,” the governor continued. “While previously atConservation and Natural Resources, Cindy Dunn led a conser-vation landscape program that provided tens of millions of dol-lars annually for conservation and recreation throughout thecommonwealth. Cindy has the experience to develop new pro-grams and new policies that increase access to these invaluableassets and enhance our state parks and state forest facilities.”

The state Senate must approve Wolf’s nominations, and inpublished reports some senators have expressed skepticism thatQuigley and Dunn will be able to check their anti-industry viewsat the agencies’ door. In a report by StateImpact PA, Wolf wasquoted as saying he doubts either nominee will face substantialopposition in the confirmation process from the Republicanmajority in the Senate.

“My experience is senators look at the qualifications, not theideology,” the governor said. “I think they’ll look at the overall

picture and say,‘Are these peoplecompetent andqualified?’ and Ithink the answerhas to be ‘Yes.’”■

Page 35: The PIOGA Press - Feburary 2015

February 2015 Page 35

The PF2100 Burner Management System is your no-BS solution for natural draft burners. This advanced electronic BMS protects personnel while monitoring and controlling equipment in the toughest environments.

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• heated seperators• incinerators• line heaters• treaters

Page 36: The PIOGA Press - Feburary 2015

Page 36 The PIOGA Press

$40.00

$50.00

$60.00

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Natural Gas Futures Closing PricesAs of February 6

Month PriceMarch 2015 2.579April 2.602May 2.645June 2.695July 2.756August 2.772September 2.765October 2.798November 2.911December 3.106January 2016 3.244February 3.238

SourcesAmerican Refining Group: www.amref.com/Crude-Prices-New.aspxErgon Oil Purchasing: www.ergon.com/prices.phpGas futures: http://quotes.ino.com/exchanges/?r=NYMEX_NGBaker Hughes rig count: http://gis.bakerhughesdirect.com/ReportsNYMEX strip chart: Emkey Energy LLC emkeyenergy.com

Oil & Gas Trends

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Penn Grade Crude Prices

Page 37: The PIOGA Press - Feburary 2015

February 2014 Page 37February 2015 Page 37

Purchasers of Penn Grade & Utica Crude Oil

77 N. Kendall Ave.Bradford, PA 16701

814-368-1200

www.amref.com

Dan PalmerCrude Relationship Mgr PA / NY

[email protected]

ISO 9001:2008 Certified

Supplying Quality Lubricants Refined UsingPenn Grade Crude Oil

[email protected]: (412) 667-9817

www.newprospect.com

NEW PROSPECT COMPANY

Office: (724) 742-1122Fax: (724) 742-4703

NEW PROSPECT COMPANY120 MARGUERITE DRIVE, SUITE 201 • CRANBERRY TOWNSHIP, PA 16066

DANIEL R. STEFFYNE Business Development ManagerEngineering, Completions and Drilling Consultants

Advertise Your Products & ServicesContact Matt Benson, 814-778-2291 / [email protected]

Page 38: The PIOGA Press - Feburary 2015

Page 38 The PIOGA Press

New PIOGA members — welcome!

Capozzi Adler, P.C.P.O. Box 5866, Harrisburg, PA 17110717-233-4101www.capozziadler.comProfessional Firm

Environmental Compliance & Testing Services, Inc.318 East Maiden Street, Washington, PA 15301724-705-7048www.myectservices.comService Provider

E-Tank4113 Millennium Boulevard SE, Massillon, OH 44646716-796-3355www.etank.netService Provider

Geostabilization International543 31 Road, Grand Junction, CO 81504855-579-0536www.geostabilization.comProfessional Firm

GPD Group520 South Main Street, 2531, Akron, OH 44311330-572-2100www.gpdgroup.comProfessional Firm

Locus Solutions, LLC30500 Aurora Road, Suite 180, Solon, OH 44139

440-561-0800www.locusbio.comService Provider

Miller Rig Works, Inc.2724 State Route 156, Spring Church, PA 15686724-478-5537Service Provider

Pace Analytical1638 Roseytown Road, Greensburg, PA 15601724-850-5600www.pacelabs.comProfessional Firm

Pace Global Siemens4401 Fair Lakes Court, Fairfax, VA 22033703-989-5009www.paceglobal.comProfessional Firm

Park National Bank140 E. Town Street, Suite 1400, Columbus, OH 43054614-228-5959www.parknationalbank.comProfessional Firm

RJ Lee Group350 Hochberg Road, Monroeville, PA 15146724-325-1776www.rjlg.comProfessional Firm

State Electric Supply Co.2101 Second Avenue, Huntington, WV 25703-0397304-528-0232www.stateelectric.comService Provider

1500 Sycamore Rd., Suite 320Montoursville, PA 17754570-368-3040www.mctish.com

Additional OfficesAllentown, PAPittsburgh, PA

WINNERNortheast

2013

Page 39: The PIOGA Press - Feburary 2015

PIOGA Board of DirectorsGary Slagel (Chairman), Steptoe & Johnson PLLC (representing

CONSOL Energy)Sam Fragale (Vice Chairman), SEF Consulting, LLCFrank J. Ross (2nd Vice Chairman), T&F Exploration, LPJames Kriebel (Treasurer), Kriebel CompaniesCraig Mayer (Secretary), Pennsylvania General Energy Co., LLCTerrence S. Jacobs (Past President), Penneco Oil Company, Inc.L. Richard Adams, Chief Oil and GasThomas M. Bartos, ABARTA EnergyStanley J. Berdell, BLX, Inc.Rob Boulware, Seneca Resources CorporationCarl Carlson, Range Resources - Appalachia, LLCMike Cochran, Energy Corporation of AmericaDon A. Connor, Open Flow EnergyTed Cranmer, TBC ConsultingJack Crook, Atlas Resource Partners, LPRobert Esch, American Refining Group, Inc.Michael Hillebrand, Huntley & Huntley, Inc.Jim Hoover, Phoenix Energy Productions, Inc. Ron McGlade, Tenaska Resources, LLCJim McKinney, EnerVest Operating, LLCSteve Millis, Vineyard Oil & Gas CompanyGregory Muse, PennEnergy Resources, LLCJoy Ruff, Dawood Engineering, Inc.Stephen Rupert, Texas Keystone, Inc.Jake Stilley, Patriot Exploration CorporationBurt A. Waite, Moody and Associates, Inc.Roger B. Willis, Universal Well Services, Inc.Thomas Yarnick, XTO Energy

Committee ChairsEnvironmental Committee

Paul Hart, Fluid Recovery Services, LLCKen Fleeman, ABARTA Energy

Legislative CommitteeBen Wallace, Penneco Oil CompanyHolly Christie, Steptoe and Johnson, PLLC

Pipeline & Gas Market Development CommitteeBob Eckle, Appalachian Producer Services, LLCRon McGlade, Tenaska Resources, LLC

Health & Safety CommitteePat Carfagna, CONSOL Energy

Meetings CommitteeLou D’Amico, PIOGA

Tax CommitteeDonald B. Nestor, Arnett Foster Toothman, PLLC

Communications CommitteeTerry Jacobs, Penneco Oil Company, Inc.

StaffLou D'Amico ([email protected]), President & Executive DirectorKevin Moody ([email protected]), Vice President & General Counsel Debbie Oyler ([email protected]), Director of Member ServicesMatt Benson ([email protected]), Director of Internal Communications

(also newsletter advertising & editorial contact)Joyce Turkaly ([email protected]), Director of Natural Gas Market

DevelopmentDan Weaver ([email protected]), Public Outreach DirectorDanielle Boston ([email protected]), Director of AdministrationChris Lisle ([email protected]), Manager of Finance Tracy Zink ([email protected]), Administrative Assistant

Pennsylvania Independent Oil & Gas Association115 VIP Drive, Suite 210 • Wexford, PA 15090-7906724-933-7306 • fax 724-933-7310 • www.pioga.org

Northern Tier Office (Matt Benson)Mail: P.O. Box L, Mount Jewett, PA 16740-0554

Physical address: 167 Wolf Farm Road, Kane, PA 16735Phone/fax 814-778-2291

© 2015, Pennsylvania Independent Oil & Gas Association

February 2014 Page 39February 2015 Page 39

PIOGA EventsPIOGA Winter Meeting

February 24-25, Seven Springs Mountain Resort, ChampionInfo: www.pioga.org/events/category/pioga-events

PIOGA Summer Picnic & Golf OutingJune 1 , Wanango Golf Club, RenoInfo: www.pioga.org/events/category/pioga-events

PIOGA Pig Roast, Equipment Show & SeminarJuly 28-29, Seven Springs Mountain Resort, ChampionInfo: www.pioga.org/events/category/pioga-events

18th Annual Divot Diggers Golf OutingAugust 26, Tam O’Shanter of Pennsylvania, Hermitage Info: www.pioga.org/events/category/pioga-events

Eastern Oil & Gas Conference and Trade ShowOctober 27-28, Monroeville Convention Center, MonroevilleInfo: www.pioga.org/events/category/pioga-events

Industry EventsIPAA Congressional Call-Up

March 2-4, Loews Madison Hotel, Washington, DCInfo: hwww.ipaa.org/meetings-events

OOGA Winter MeetingMarch 11-13, Hilton Columbus at Easton, OHInfo: ooga.org/events

IPAA Midyear MeetingJune 24-26, Eldorado Hotel & Spa, Santa Fe, NMInfo: hwww.ipaa.org/meetings-events

KOGA Annual MeetingJuly 14-16, Hyatt Regency Lexington, KYInfo: koga.memberclicks.net/2015-annual-meeting

IOGANY Summer MeetingJuly 8-9, Peek'n Peak Resort & Conference Center,Findley Lake, NYInfo: www.iogany.org/events.php

IOGAWV Summer MeetingAugust 2-4, The Greenbrier, White Sulphur Springs, WVInfo: events.iogawv.com

IPAA Annual MeetingNovember 9-10, The Ritz-Carlton, New Orleans, LAInfo: hwww.ipaa.org/meetings-events

Calendar of Events

➤ More events: www.pioga.org

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Page 40: The PIOGA Press - Feburary 2015

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