PA: Conventional O&G Companies Accelerating Pace of Abandoning Wells Without Plugging Them

Threatens to Put PA’s Taxpayer-Funded Well Plugging Program Even Further Behind

By David E. Hess | PA Environment Digest Blog | September 6, 2022

The pace of companies abandoning conventional oil and natural gas wells without plugging them continues to accelerate in 2022 threatening to put Pennsylvania’s taxpayer-funded well plugging program even further behind.

In July and August, DEP issued 108 notices of violation to conventional oil and gas operators for abandoning wells without plugging them and two notices of violation for the same offense to an unconventional shale gas driller, according to DEP’s Oil and Gas Program Compliance Database.

That’s more NOVs for the same offense issued in the three months of the second quarter– 82 conventional wells and 21 unconventional wells (total 103)– and the three months of the first quarter– 77 conventional wells and 8 unconventional wells (total 85).  Read more here.

So far in 2022 a total of 267 notices of violation were issued for conventional wells and 34 for unconventional shale gas wells for abandoning without plugging them for a total of 298 wells.

And these were only the wells DEP inspectors caught companies abandoning during their regular inspections.

Taxpayers pick up the cost

Every oil and gas well abandoned by the oil and gas industry means taxpayers have pick up the cost of plugging and cleaning up those sites.

Conventional oil and gas well companies have so far shifted over $5.1 billion in well pluygging costs to taxpayers because they are required to put up zero bonds to cover plugging costs for wells they drilled before April 1985– which is most of them– and only limited bonding for wells since then that does not begin to cover taxpayers’ plugging costs.  Read more here

The conventional industry also passed legislation in July that Gov. Wolf allowed to become law blocking any attempts to increase the bonding amounts for 10 years.  Read more here.

To put the 267 notices of violation for abandoning conventional oil and gas wells so far this year in perspective, that’s over five times the number of wells DEP plans to plug– 50– with the initial $25 million from the new, highly touted, federal taxpayer-funded Bipartisan Infrastructure Law conventional oil and gas well plugging program.  Read more here.

It’s also important to understand, notices of violation are DEP’s first step in trying to get a driller’s attention that a violation has occurred and they need to take steps to resolve the issue.

DEP’s Oil and Gas Program Compliance Database has incomplete information on if these violations were resolved.

In terms of past enforcement actions, DEP only assessed monetary penalties against 15 of the 256 conventional oil and gas operators who received notices of violation for abandoning wells without plugging them over the last six years, according to DEP’s response to a Right to Know request to the Oil and Gas Management Program for penalty information covering conventional operators from 2016 through 2021.   Read more here.

During those same six years, DEP issued over 4,270 notices of violations for abandoning wells.  Read more here.

It is clear abandoning wells without paying the cost of plugging them is a pervasive part of the way conventional oil and gas industry’s operate.  Read more here.

Counties With Newly Abandoned Wells

In July and August, conventional operators were given NOVs for abandoning wells without plugging them in these 11 counties– Butler (3), Crawford (1), Ek (2), Erie (7), Forest (3), McKean (6), Mercer (2), Venango (72), Warren (2) and Westmoreland (10).

DEP issued NOVs for abandoning two unconventional shale gas wells in Wyoming County.

Companies Abandoning Wells

In July and August, these 29 conventional operators were given NOVs for abandoning wells without plugging them–  All American Energy (1); Allshouse Excav. (9); Allshouse, Terrance L. Jr. (4); Apex Energy (1); AZCO OPR (1); BV Gas LLC (1); C&D Gas Co. (1); Champion Bolt Corp (2); Cobra Resources (5); Diversified Prod (2); Dorso LP (1); Energy Exploration & Dev. (1); Five Star Investment Group (1); FM Sloan Inc. (2); Fyrerols Reservoir Consulting (3); Grace M. Marzalen (1); Hartstown OIl & Gas Explor (1); Horizontal Exploration (6); HypePark Foundry & Mach Co. (1); Lendrum Energy LLC (40); LT OIl Co LLC (5); Magi Oil (1); Mid East Oil (1); Nucomer Energy (1); PA Mineral Services (1); Pierce & Peterson (2); Pin Oak Energy Partners (1); Timberline Energy (9); and Titus Energy (1).

Chesapeake Appalachia was issued notices of violation by DEP for abandoning two unconventional shale gas wells without plugging them in Wyoming County during July and August.

DEP Conventional Drilling Compliance Review

On July 30, Gov. Wolf directed the Department of Environmental Protection to conduct an evaluation of how it regulates conventional oil and gas wells to prevent new abandoned wells, tighten review of permit transfers, review compliance with environmental safeguards and make recommendations for changes and actions, including criminal sanctions.

The evaluation was due to the Governor’s Office by September 1.  Read more here.

It is critical DEP evaluate whether its compliance tools are actually getting compliance with Pennsylvania’s oil and gas laws and regulations and where changes need to be made.

On allowing new abandoned wells in particular, up to $395 million in funding is at stake over the next 15 years from the new federal Bipartisan Infrastructure Law for plugging abandoned conventional oil and gas wells.  Read more here.

On August 18, Kurt Klapkowski, Acting DEP Deputy Secretary for Oil and Gas Management, told DCED’s  PA Grade Crude [Oil] Development Advisory Council the conventional oil and gas driller compliance review will evaluate at least the last five years of compliance.

When asked whether DEP’s evaluation and accompanying recommendations would be in a public document, Klapkowski said, “… don’t know the answer to that question.  All I can say is what was published in the Pennsylvania Bulletin, the instructions that we were given in terms of preparing a report for the conventional industry’s record of compliance.”

For the sake of the credibility of DEP’s Oil and Gas Management Program, and Pennsylvania’s environment, the document should be public and its methodology and recommendations fully disclosed.

To track oil and gas facility compliance with Pennsylvania’s laws and regulations, visit DEP’s  Oil and Gas Program Compliance Database and search by company.

You will be shocked at what you find.

Related Articles:

U.S. Dept. Of Interior Awards PA $25 Million In Conventional Oil & Gas Well Plugging Funding From Federal Bipartisan Infrastructure Law [PaEN]

— Only 15 Out Of 256 Conventional Oil & Gas Operators Who Abandoned Wells Without Plugging Them Were Fined By DEP; Small Penalties No Deterrent To Future Abandonments  [PaEN]

— Bay Journal: New Abandoned Wells – More Concerns Emerge Over Pennsylvania’s Conventional Oil & Gas Wells – By Ad Crable, Chesapeake Bay Journal  [8.25.22]

— New Abandoned Wells: DEP Records Show Abandoning Oil & Gas Wells Without Plugging Them Is Pervasive In Conventional Drilling Industry; Who Is Protecting Taxpayers?  [PaEN]

— 12 Unconventional Shale Gas Drillers Issued DEP Notices Of Violation For Abandoning Wells Without Plugging Them At 35 Well Pads In 17 Counties [PaEN]

— Quarterly Report: DEP Issued 77 Notices Of Violations To Conventional Drillers, 8 To Shale Gas Drillers For Attempting To Abandon Wells Without Plugging Them  [PaEN]

— DEP Issues 20% More NOVs To Oil & Gas Well Drillers For Abandoning Wells Without Plugging Them In 2nd Quarter [PaEN]

— DEP: Wastes Generated By The New Conventional Oil & Gas Well Plugging Program Will NOT Be Exempt From Hazardous Waste Regulations, Unlike Wastes From Active Wells  [PaEN]

— Creating New Brownfields: Oil & Gas Well Drillers Notified DEP They Are Cleaning Up Soil & Water Contaminated With Chemicals Harmful To Human Health, Aquatic Life At 272 Locations In PA  [PaEN]

— New Penn State Study Finds Runoff From Conventional Oil & Gas Wastewater Dumped On Unpaved Roads Contains Pollutants That Exceed Human-Health, Environmental Standards  [5.27.22]

— Conventional Oil & Gas Drillers Reported Spreading 977,671 Gallons Of Untreated Drilling Wastewater On PA Roads In 2021  [PaEN]

Conventional Oil & Natural Gas Drilling: An Industrial Machine Moving Across The PA Countryside Leaving Behind Big Liabilities & Spreading Pollution Everywhere It Goes  [PaEN]

— Senate Hearing: Body Of Evidence Is ‘Large, Growing,’ ‘Consistent’ And ‘Compelling’ That Shale Gas Development Is Having A Negative Impact On Public Health; PA Must Act  [PaEN]

— Environmental Health Project: PA’s Natural Gas Boom – What Went Wrong? Why Does It Matter?  What Can We Do Better To Protect Public Health?  [PaEN]

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[Posted: September 6, 2022]  PA Environment Digest | Source

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