Unatego Area Landowners Association



Otego - Unadilla - Butternuts Area Residents

             News & Updates

       New Compulsory Integration Legislation 

Two bills have been introduced into the legislature, A10956 and S7758, which provide that integrated royalty owners in the New York Marcellus Shale Region shall receive a royalty equal to the highest royalty in the existing lease in the spacing unit, but not less than 18.75%." 

This bill deserves our support.  E-mail, write, call (or all three) the legislators listed below.  We urge our downstate landowners to do likewise to their legislators.  If you live out-of-state, make your interests known.  And everybody should tell their neighbors about this bill. 

THIS BILL IS IMPORTANT LEGISLATION FOR ALL OTESGO COUNTY LANDOWNERS AND THE FUTURE OF OUR AREA.

Our legislators are:
Assemblyman Pete Lopez
LOB 429
Albany, NY  12248
Phone (518) 455-5363
e-mail  Lopezp@assembly.state.ny.us

Senator Jim Seward
LOB 711B
Albany, NY  12247
Phone  (518) 455-3131
E-mail  Seward@senate.state.ny.us
or www.senatorjimseward.com

Also thank Donna Lupardo who authored this legislation.  Her e-mail is  --   Lupardod@assembly.state.ny.us


 
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State Decision Blocks Drilling for Gas in Catskills

By Mireya Navarro
Published: April 23, 2010

New York State environmental officials announced on Friday that they would impose far stricter regulations on a controversial type of natural gas drilling in the upstate area that supplies most of New York City’s drinking water, making it highly unlikely that any drilling would be done there.

Although they did not impose an outright ban on drilling, state officials said that any natural gas company would have to conduct a separate environmental impact review for each well it proposed to drill in the Catskills watershed, which supplies the city.

Those rules also apply to the smaller Skaneateles Lake watershed, which supplies drinking water to Syracuse and some other communities.

In other areas, companies would face a far less cumbersome permit process that would rely on the state’s own environmental assessment of where drilling can be allowed.

New York City officials and environmentalists had vigorously opposed the drilling, citing concern about the disposal of wastewater from the drilling and the danger of leaks into groundwater and deep aquifers.

The gas companies planned to rely on a technique known as hydraulic fracturing, also called fracking, which involves blasting water mixed with chemicals into rock at high pressure to extract the gas.

With the New York City water issue shelved, state officials clearly hope to put the controversy behind them. They said they expect to release their final regulations on hydraulic fracturing by the end of the year, having solicited more than 14,000 comments from the public.

The decision by the State Department of Environmental Conservation also means that New York City will not have to worry about spending billions of dollars on a filtration plant to protect its water supply from possible contamination by the drilling.

City officials welcomed the announcement. “The additional reviews that D.E.C. has mandated will ensure that the specific and cumulative impacts in the New York City and Syracuse watersheds are understood, and that these unique landscapes are fully protected, as a prerequisite to any drilling activity,” said Cas Holloway, commissioner of New York City’s Department of Environmental Protection.

He said the decision “recognizes that protecting New York’s water supplies must be our top priority.”

The two areas lie within the Marcellus Shale region, a subterranean layer of rock stretching from New York to Tennessee believed to be one of the world’s biggest natural gas fields.

The Catskills watershed supplies drinking water to 8.2 million people in New York City and about one million people in Westchester, Putnam and Dutchess Counties. The Skaneateles Lake watershed serves about 200,000 people in Syracuse and elsewhere.

While the prospect of drilling stirred deep opposition in New York City and nearby counties, it drew support from many upstate residents who argued that the benefits would far outweigh any risks, given the weakness of the economy.

The conservation department’s commissioner, Alexander B. Grannis, said that landowners’ property rights had weighed heavily in the decision not to issue a ban on drilling in the two watersheds. He said that about 70 percent of the property in the watershed is privately owned and that a ban would have undoubtedly brought lawsuits from owners deprived of lucrative leasing deals with gas companies.

“At the end of the day, an outright ban risks very substantial litigation,” he said.

Instead, the department decided to add more scrutiny to any potential application to drill in the two areas, he said.

But while the well-by-well environmental reviews will be a deterrent to the drilling, environmental groups were not claiming victory. Kate Sinding, a senior lawyer with the Natural Resources Defense Council, said nothing but a ban would ensure that gas companies do not exploit the watersheds in the future.

“If they get into the shale and find it productive, they’re going to knock on the door of the watershed,” she said. The two watershed areas account for less than 10 percent of the shale, state officials said. Bowing to public pressure, the Chesapeake Energy Corporation said last October that it would stay away from the New York City watershed despite holding leases that would have allowed it to pursue state permits to drill there.

Jim Smith, a spokesman for the Independent Oil and Gas Association of New York, called the state’s regulatory stance “excessive and unnecessary.”

But he said that there was “not a lot of interest in the watershed from companies” at this point at any rate.

State officials said the two watersheds presented additional concerns that had nothing to do with the safety of the drilling, like pollution from increased truck traffic related to the drilling operations.

By omitting the two watersheds, they said, they will be able to focus on the overall environmental safety of drilling.

“Originally, we thought it’d make sense to address all of this at once,” said Stuart Gruskin, executive deputy commissioner of the Department of Environmental Conservation.

“We acknowledge that there’s a separate subset of issues that are independent of the safety of hydrofracking,” he said. “It’s better to leave those issues out of it.”

The Department of Environmental Conservation came under intense pressure after issuing draft regulations governing the drilling last year. New York City officials pushed to have the regulations withdrawn after commissioning a study that showed drilling could damage infrastructure, including aqueducts.

The agency did not specifically call for a ban on drilling in watershed areas, but said it had “serious reservations about whether gas drilling in the New York City watershed is consistent with the vision of long-term maintenance of a high-quality unfiltered water supply.”

                      http://www.nytimes.com/2010/04/24/science/earth/24drill.html?hp 

 

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                             News & Updates

 

    Binghamton Natural Gas Summit 3/18/10

Opening Remarks and Scene-Setting with Scott  Kurkoski

March 18, 2010

Scott Kurkoski Marcellus Drilling News attended the Natural Gas Development Summit held in Binghamton on March 18th at the Regency Hotel. The event was organized and sponsored by the Joint Landowners Coalition of New York. There were about 150 people in the audience, made up of landowners, people from the drilling industry (lawyers, energy companies, engineering companies and others), and the press. It was a half day event, starting at 9:30 am and ending at 12:45 pm. MDN will run a series of posts to cover the presentations. This article contains the opening remarks delivered by Scott Kurkoski, a lawyer specializing in mineral rights with Levene, Gouldin & Thompson. Scott was one of the chief organizers of the event and master of ceremonies.

He opened by stating the purpose of the meeting is to have a discussion about the issues, with an aim to move the issue of drilling in New York State forward. He thanked Broome County Executive Barbara Fiala for hosting the event and for her efforts on behalf of landowners.

Scott next provided the background for where we are now in New York, and how we got here. In 1992, the New York Department of Environmental Conservation created a Generic Environmental Impact Statement (GEIS) to govern oil and gas drilling in New York. Since then, newer technologies (horizontal drilling and hydraulic fracturing or “fracing”) have come along and the DEC, under direction from the Governor’s office, drafted Supplemental (new) regulations to account for these new technologies and their use.

There was a public comment period near the end of 2009 and over 10,000 comments were filed with the DEC. They are now reviewing those comments and it is hoped they will finalize the SGEIS regulations by June of this year so drilling can finally start. However, once the DEC releases the final SGEIS, Gov. Patterson will have to approve it before drilling begins. There was a petition at the meeting for interested people to sign, requesting the Governor approve the regulations immediately upon finalization.

Scott is a member of the Joint Landowners Coalition of New York. He recounted the history of its beginning. A group of 300 landowners in the Deposit area successfully negotiated a $90 million deal with XTO Energy in 2008. (The terms of the deal were $2,411 per acre and 15 percent royalties.) After that deal, landowners throughout the region started to form other landowner groups based on geography. The heads of those groups started to meet informally, and eventually the Joint Landowners Coalition of New York (JLCNY)—which is a “group of groups”—was formed. The JLCNY has 37 member coalitions representing some 800,000 acres and 70,000 people. In January of this year, the JLCNY registered as a 501(c)6 non-profit organization.

According to Scott, landowners care more about their land than anyone else. In many cases, the land has been in families for generations. He said that landowners are “the true environmentalists.” They don’t want their land to be harmed or irreparably damaged. The problem is, according to Scott, landowners have been too silent on the matter of drilling. Their voices need to be heard and landowner coalitions are one of the ways that can happen.

During the public comment period for the SGEIS last December, there started to be loud opposition to drilling. Scott said New York City Mayor Michael Bloomberg and other politicians in the New York City area held frequent press conferences and tried to build a case to ban gas drilling altogether. But there’s a problem with that…there are already 13,000 active non-Marcellus oil and gas wells in New York State! A total ban on drilling is nonsensical.

The long delay in the start of Marcellus drilling is taking a toll on New York. Businesses are going to Pennsylvania and elsewhere. Scott cited two recent cases: An energy company looking to invest $75 million in New York was two days away from closing a deal and pulled out because, “New York is just too unsettled right now.” Once all associated business activity for a deal of that size are considered, losing that $75 million deal was actually losing $300-$500 million in ultimate spending in New York.

Scott recounted the story of another company looking to invest $23 million in a facility in Tioga County, NY, with the promise of creating 450 new jobs. Again, the hurdles were too high and the delays too long. The company decided to take their business, money and jobs over the border to Pennsylvania in January of this year. Another 450 jobs in New York would have been a boon to the Southern Tier region.

An often-heard argument is that, “The Marcellus Shale has been there millions of years, it’s not going anywhere, there’s no hurry to develop it right now.” Scott disagrees. Once companies decide to locate in a different state—they stay there. The jobs never come to New York. Every day New York continues to delay drilling, New York jobs and money disappear.

Drilling regulations in New York will be the strictest in the nation. It begs the question, “So what do we have to fear?” There is no excuse for further delays.

Scott made an impassioned case that New York needs to start drilling soon. And he made the statement that New York City cannot be allowed to speak for Upstate on the matter of drilling.

http://marcellusdrilling.com/2010/03/binghamton-natural-gas-summit-opening-remarks-and-scene-setting-with-scott-kurkoski/?utm_source=Marcellus+Drilling+News&utm_medium=email&utm_campaign=89edb0378b-MDN_Daily_Alert  

              ----------

   MORE COVERAGE OF THE BINGHAMTON GAS SUMMIT

              FROM MARCELLUS DRILLING NEWS

 

Binghamton Natural Gas Summit: How Many Jobs Does Drilling (Really) Create?Mar 22, 2010 - Beyond random speculation, is there really any way to know, scientifically and accurately, just how many drilling-related jobs are being created in the Marcellus Shale? Yes there is! And two of the speakers at the Natural Gas Development Summit held in Binghamton on March 18th at the Regency Hotel, who have extensively studied the [...]Right-click here to download pictures. To help protect your privacy, Outlook prevented automatic download of this picture from the Internet.read more

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Mar 22, 2010 - At the Binghamton Natural Gas Development Summit held on March 18 at the Binghamton Regency Hotel, Marcellus Drilling News had the pleasure of speaking with Bryant La Tourette, Vice President of the Joint Landowners Coalition of New York (JLCNY), the organization sponsoring the event. Bryant is also the president of the Oxford Land Group, a [...]Right-click here to download pictures. To help protect your privacy, Outlook prevented automatic download of this picture from the Internet. read more

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Mar 18, 2010 - At the conclusion of the March 18 Natural Gas Development Summit held at the Binghamton Regency Hotel, Marcellus Drilling News caught up with event organizer Scott Kurkoski from Levene, Gouldin & Thompson, to ask him for his review of the meeting. Here’s what he told us:Right-click here to download pictures. To help protect your privacy, Outlook prevented automatic download of this picture from the Internet. read more 

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Binghamton Natural Gas Summit: Millennium Pipeline President Richard Leehr

Mar 24, 2010  -  One of the speakers at the Natural Gas Development Summit held in Binghamton on March 18th was Richard Leehr, president of Millennium Pipeline (MP), a major natural gas pipeline running from Western New York State almost to New York City. What follows are MDN’s notes from his presentation. Unfortunately Millennium has a policy against [...]Right-click here to download pictures. To help protect your privacy, Outlook prevented automatic download of this picture from the Internet.: read more
 
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Mar 25, 2010  - Jerry Simons was the final presenter at the March 18 Binghamton Natural Gas Development Summit. He is the executive director of the National Association of Royalty Owners (NARO). According to Mr. Simmons, NARO is the only organization to represent landowners that is completely independent and not attached to energy companies in any way. | read more

Gastem, USA: Ross Well results 'promising'; resident voices concerns

By Tom Grace                                                                                                                            Feb. 2, 2010

Cooperstown News Bureau

Results from drilling a vertical natural-gas well on Crumhorn Mountain in the town of Maryland are promising, Orville Cole, president of Gastem, USA, said Monday.

``The thicknesses of the shale were better than expected,'' he said.

Thicker shale layers indicate larger, more economically viable, stores of gas.

The prospects of the vertical well, known as Ross 1, were covered by financial news services, including Yahoo's, which reported that Gastem's chief executive officer, Raymond Savoie, stated: ``The Ross well, our first well in New York State, has largely exceeded our expectations, and we are accelerating programs.

``Although early, we believe that the area could begin commercial production in the near future.''

Cole said the results of Ross 1 were good but have not altered Gastem's plans.

The firm is proceeding methodically, waiting to see what regulations the state DEC will impose on horizontal gas drilling and hydraulic fracturing, he said.

``We're basically planning one to two wells in the county in the next six months, once we get all the necessary approvals,'' Cole said.

He said the firm, which holds ``an 80 percent interest (in mineral rights) on approximately 35,000 acres in Otsego County,'' according to Yahoo, is prospecting, trying to determine how much gas underlies the county.

``We don't really know all we need to,'' he said.

Asked where Gastem might drill next, he said the firm has many options.

With current state limitations on the volume of hydraulic fracturing fluid that can be pumped into vertical wells, Gastem is done at the Ross site for now, he said. If those limits are raised, the well might be re-fracked to shatter rock and release more gas.

When a vertical well is promising, it's possible to later drill a horizontal well from the same pad to greatly increase the yield, Cole noted.

The Ross well was news in Watertown recently because fracking waste water from Maryland was shipped to Watertown to be treated at the city's sewage treatment plant.

In September, two loads of waste water from Ross 1 were rejected by Watertown as too contaminated to be safely processed, according to the Watertown Daily Times.

Cole said the situation has been resolved and the waste water processed.

``The water from the site was a heavier brine than Watertown hadn't expected. So they had us take it back to the site,'' he said.

``So we took it back, did the tests and it was determined that Watertown would accept that. We tested the frack water, and it was determined by the DEC _ and I believe EPA had seen the tests _ and the Watertown management to be OK, and it was accepted.''

Nicole Dillingham, president of Otsego 2000, said she is troubled by the difficulty of processing even the limited amount of fracking fluid in the Maryland well.

``This is a vertical well, and the amount of fluid is relatively small,'' she said. ``Can you imagine if it were a horizontal well with a million gallons? Who's going to process that?''

Dillingham said the state and its municipalities are not prepared to handle the flood of fracking fluid, laced with toxic chemicals, that will come if widespread horizontal drilling is allowed to proceed.

 

 

 

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DEC proposes new Marcellus Shale drilling safety measures, mitigation strategies

ALBANY - The New York State Department of Environmental Conservation released a draft of the Supplemental Generic Environmental Impact Statement (SGEIS) governing potential natural gas drilling activities in the Marcellus Shale formation, Commissioner Pete Grannis announced, Wednesday.
The SGEIS addresses the range of potential impacts of shale gas development using horizontal drilling and high-volume hydraulic fracturing and outlines safety measures, protection standards and mitigation strategies that operators would have to follow to obtain permits. Natural gas drilling presents economic development and job creation opportunities, and can help achieve state energy policy goals. As there are also potential environmental impacts, Governor David A. Paterson directed DEC to prepare the SGEIS. Among the highlights:

Pre-drilling

  • Disclosure of Fracturing Fluids: Every applicant must include disclosure of the "frac" fluid compositions and the percentages of chemicals to be used for each well.
  • Water Well Testing: Prior to drilling, private wells within 1,000 feet of the drill site will be tested to provide baseline information and allow for ongoing monitoring. If there are no wells within 1,000 feet, the survey area will extend to 2,000 feet.
  • Water Consumption: Companies will not only have to follow Susquehanna River Basin Commission and Delaware River Basin Commission protocols for water withdrawl where applicable, but also must complete a more stringent and protective streamflow analysis in regards to water withdrawal plans – whether inside or outside the Susquehanna or Delaware basins.
  • Technical Compliance: Prior to hydraulically fracturing a well, operators must complete a new "Pre-Frac Checklist and Certification Form" to ensure technical compliance with the permit and to provide information regarding final well-bore construction and hydraulic fracturing operations.
  • Mitigation planning: All operators are required to prepare plans for mitigating greenhouse gas emissions, visual impacts and noise impacts prior to commencing operations. In addition, if a drilling company has not reached a road-use agreement with the local government, a trucking plan containing the estimated amount of trucking, approach for avoiding peak traffic hours, appropriate off-road parking/staging areas, and routes must be submitted.

Drilling and Post-Drilling

  • In primary and principle aquifer areas: a) state inspectors must be present when operators commence cementing well-bore casings; b) more stringent drilling and casing requirements are applicable; c) special requirements are imposed to expeditiously remove fluids from on-site reserve pits or well pad tanks. This last requirement also applies in the NYC Watershed.
  • Flowback (wastewater) handling on-site: Operators choosing to store flowback on-site must use steel tanks to protect the environment.
  • Centralized flowback storage: If an operator proposes using a centralized impoundment (centralized flowback storage) to serve multiple sites, it must use a double-liner system similar to those required for landfills, provide fencing and off-sets to prevent public access and employ measures to protect wildlife. In addition, state solid waste landfill requirements and dam safety regulations will apply to construction of any centralized storage impoundments.
  • Centralized flowback impoundments are prohibited within boundaries of public water supplies (including the New York City Watershed).
  • Tracking flowback disposal: Before a permit is issued, the operator must disclose plans for disposal of flowback. Further, a new "Drilling and Production Waste Tracking" process (similar to the process for medical waste) will be used to monitor disposal. Full analysis and approvals under state water laws and regulations will be required before a water treatment facility can accept flowback from drilling operations.
  • NYC Watershed and other sensitive areas: The SGEIS contains a number of mitigation measures aimed specifically at protecting the NYC Watershed. Among them, the SGEIS defines buffer zones around reservoirs and other water bodies in the Watershed. Wells proposed within a 1,000-foot corridor of water tunnels or aqueducts will require special approvals – including a site specific Environmental Impact Statement and review by the NYC Department of Environmental Protection. Consistent with the requirements for primary and principle aquifers, fluids may not be kept on-site more than 7 days. In addition, as in other sensitive areas, centralized flowback impoundments are prohibited.
  • Floodplains: On-site reserve pits are banned in floodplains – closed-loop tank systems are required instead to protect against potential spills.
  • Stormwater control: Drilling operations will be subject to a comprehensive, multi-sector general permit for industrial activities as well as special permit conditions.

The SGEIS, available at www.dec.ny.gov/energy/47554.html, expands on the comprehensive Generic Environmental Impact Statement, adopted in 1992, that has prescribed the requirements for the drilling of thousands of oil and gas wells in New York State.

The public comment period on the draft will be open until November 30. DEC will accept comments in writing, either via e-mail, regular mail, direct online submissions or delivered at public-information sessions. The SGEIS web page will contain detailed instructions for submitting comments.

In addition, DEC soon will announce times and locations for a series of public-information sessions. For additional information regarding the draft SGEIS and background material regarding the Marcellus shale formation and gas drilling in New York State, please visit the Marcellus Shale webpage at http://www.dec.ny.gov/energy/46288.html.

For information about the long history of oil and gas drilling in New York, the more than 13,000 currently active wells and production data, go to DEC's oil and gas web page, http://www.dec.ny.gov/energy/205.html.

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                                  S T A T E   O F   N E W   Y O R K
                 _________________________________________________________________

                                                            8748

                                             2009-2010 Regular Sessions

                                                  IN   A S S E M B L Y

                                                           June 5, 2009

       ___________

       Introduced  by  M. of A. BRENNAN, COLTON, MILLMAN, FIELDS -- Multi-Spon-
         sored by -- M. of A.  COOK, GLICK, GOTTFRIED,  MAGEE,  MAISEL,  NOLAN,
         ROBINSON,  WEISENBERG  --  read  once and referred to the Committee on
         Environmental Conservation

       AN ACT to amend the environmental conservation law, in relation  to  the
         regulation of the drilling of natural gas resources

         THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
       BLY, DO ENACT AS FOLLOWS:

    1    Section 1. Legislative intent. 1. The legislature finds that the proc-
    2  ess used to stimulate natural gas extraction referred  to  as  hydraulic
    3  fracturing utilizes components that are often toxic, that are non-biode-
    4  gradable,  and  that  are virtually impossible to remove once they enter
    5  the natural environment.  Thus, they pose such a high level of  environ-
    6  mental  risk  that  the  policy  of the state must be to insure they are
    7  excluded from any area that is significant  for  public  drinking  water
    8  resources or any other area that is environmentally sensitive.
    9    2.  Natural gas drilling is potentially highly transformative of rural
   10  landscapes, offering economic benefits to many landowners, but threaten-
   11  ing the property values of other  local  landowners,  traditional  rural
   12  economic  activity,  the  carrying capacity of local infrastructure, the
   13  natural habitat of wildlife, and the public health and quality  of  life
   14  of  residents  in  areas  where  there  is natural gas extraction taking
   15  place. Unless these resources are protected in the permitting and  regu-
   16  latory  processes of the state, the costs of Marcellus shale natural gas
   17  extraction will exceed the benefits  and  natural  gas  extraction  will
   18  become  a fundamentally unfair and divisive process in which the profits
   19  of some are subsidized by the costs to others.
   20    3. The proposed scope of natural gas drilling across the state of  New
   21  York  will  present  unprecedented  challenges  of regulatory oversight.
   22  Funding for such oversight must be sufficient to meet this challenge and
   23  should come from a series of fees paid  by  the  natural  gas  industry.

        EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                             [ ] is old law to be omitted.
                                                                  LBD11784-03-9
       A. 8748                             2

    1  Similarly, the natural gas industry should pay for all other costs asso-
    2  ciated  with  natural  gas extraction. Otherwise, natural gas extraction
    3  will be unfairly subsidized, either  by the New York state  taxpayer  or
    4  by the impacts on local human and natural resources.
    5    4.  One  of  the  chief environmental and infrastructure assets of the
    6  state of New York is its drinking water systems, which play a  fundamen-
    7  tal  role  in  the economic productivity and public health of the state.
    8  The legislature finds that no risk to these resources and to the  public
    9  health  of  their  users  is acceptable and that the policy of the state
   10  with respect to the management of shale gas extraction must be one of no
   11  drinking water risk.
   12    5. The purpose of this legislation is to insure that the  exploitation
   13  of shale natural gas resources is conducted in a manner that is consist-
   14  ent  with and supportive of New York state's commitment to sustainabili-
   15  ty, and is consistent with other state economic development, energy  and
   16  environmental policies.
   17    6.  Therefore,  in light of the many commitments the state of New York
   18  has made to more sustainable development and the critical role  greening
   19  the state's economy will play in the future prosperity of the state, the
   20  only  acceptable  natural  gas  extraction practices will be sustainable
   21  ones. This act is intended to ensure that that goal is met.
   22    S 2. Article 23 of the environmental conservation law  is  amended  by
   23  adding a new title 29 to read as follows:

   24                     TITLE 29
   25                     REGULATION OF NATURAL GAS DRILLING
   26  SECTION 23-2901. NATURAL GAS DRILLING; PROHIBITION  NEAR WATERSHED.
   27          23-2903. DISCLOSURE OF HYDRAULIC FRACTURING MATERIALS.
   28          23-2905. PROTECTION OF OTHER ENVIRONMENTAL RESOURCES.
   29          23-2907. PROTECTION OF LOCAL RESOURCES.
   30          23-2909. WATER WITHDRAWALS.
   31          23-2911. ENFORCEMENT AND FINANCIAL SECURITY.
   32          23-2913. OTHER PROVISIONS.
   33  S 23-2901. NATURAL GAS DRILLING; PROHIBITION NEAR WATERSHED.
   34    1.  NATURAL  GAS  DRILLING  SHALL NOT BE PERMITTED WITHIN THE NEW YORK
   35  CITY WATERSHED OR AT ANY POINT WITHIN FIVE MILES OF ITS BOUNDARY.
   36    2. NATURAL GAS DRILLING SHALL NOT BE PERMITTED WITHIN THE WATERSHED OF
   37  THE DELAWARE RIVER, IN ANY RECHARGE AREA OF A SOLE  SOURCE  AQUIFER,  IN
   38  ANY  AREA  WHERE  GROUNDWATER  CONTRIBUTES  A  SIGNIFICANT  BASE FLOW TO
   39  SURFACE WATER SOURCES OF DRINKING WATER, AND IN ANY OTHER AREA WHERE THE
   40  DEPARTMENT SHALL FIND PRESENTS A SIGNIFICANT THREAT OF  HYDRAULIC  FRAC-
   41  TURING COMPOUNDS ENTERING INTO A SIGNIFICANT SOURCE OF DRINKING WATER.
   42    3. NATURAL GAS DRILLING SHALL BE CONDUCTED IN WAYS THAT DO NOT CONTAM-
   43  INATE DRINKING WATER WELLS. IN ANY AREA WHERE NATURAL GAS DRILLING TAKES
   44  PLACE AND CONTAMINATION OF INDIVIDUAL DRINKING WATER WELLS OCCURS, THERE
   45  SHALL  BE A PRESUMPTION THAT THE NATURAL GAS DRILLING IS RESPONSIBLE FOR
   46  SUCH CONTAMINATION UNLESS THE NATURAL GAS DRILLER CAN SHOW, BY CLEAR AND
   47  CONVINCING EVIDENCE, THAT SUCH DRILLER IS NOT THE SOURCE OF THE  CONTAM-
   48  INATION.  UPON  RECEIVING  A REPORT OF AN INCIDENT OF WELL CONTAMINATION
   49  FROM NATURAL GAS DRILLING, THE DEPARTMENT SHALL INVESTIGATE SUCH  REPORT
   50  WITHIN TWENTY-FOUR HOURS AND SHALL HAVE THE AUTHORITY TO ORDER IMMEDIATE
   51  REMEDIAL  ACTION,  INCLUDING  ISSUING  IMMEDIATE CEASE AND DESIST ORDERS
   52  WITH RESPECT TO THE DRILLING ACTIVITY.  IN THE EVENT THAT THE DEPARTMENT
   53  IS UNABLE TO INVESTIGATE SUCH REPORT WITHIN TWENTY-FOUR  HOURS,  IT  MAY
   54  REQUEST  THAT LOCAL OR STATE POLICE AUTHORITIES CONFIRM THE INCIDENT AND
   55  REPORT AND, IF CONFIRMED, SHALL ISSUE A CEASE AND DESIST ORDER  TO  SUCH
       A. 8748 

                            3
    1  DRILLER  UNTIL IT SHALL MAKE SUCH INVESTIGATION AND DETERMINE THE PROPER
    2  COURSE OF INSURING FULL REMEDIATION.
    3    4.  ANY  SPILLS  OR  PROHIBITED  DISCHARGES  OF  HYDRAULIC  FRACTURING
    4  COMPOUNDS SHALL BE IMMEDIATELY REPORTED BY THE NATURAL  GAS  DRILLER  TO
    5  THE  DEPARTMENT,  WHICH  SHALL  ESTABLISH  PROCEDURES  FOR RECORDING AND
    6  REVIEWING SUCH REPORTS AND FOR ORDERING REMEDIAL ACTION TO  CONTAIN  THE
    7  SPILL  AND KEEP THE SPILL OR DISCHARGE INCIDENT FROM BEING REPEATED. THE
    8  DEPARTMENT SHALL HAVE THE AUTHORITY  TO  IMPOSE  FINES  FOR  FAILURE  TO
    9  REPORT  SUCH INCIDENTS, TO ORDER IMMEDIATE CLEANUP OF SUCH SPILLS AT THE
   10  EXPENSE OF SUCH DRILLER AND, SHOULD SUCH DRILLER FAIL  TO  DO  SO  IN  A
   11  TIMELY  FASHION,  TO  ENTER  INTO  THE  DRILLING AREA AND DO THE CLEANUP
   12  ITSELF, AT THE EXPENSE OF SUCH DRILLER. IN ANY INSTANCE WHERE SUCH DRIL-
   13  LER SHALL REFUSE TO CARRY OUT A DEPARTMENT CLEANUP  OR  REMEDIAL  ACTION
   14  ORDER IN A TIMELY AND APPROPRIATE MANNER, THE DEPARTMENT SHALL ORDER ALL
   15  DRILLING  ACTIVITY  TO CEASE AND DESIST UNTIL SUCH TIME AS THE SPILL HAS
   16  BEEN CLEANED UP AND SUCH DRILLER HAS REMEDIATED THE CONDITIONS OR  PRAC-
   17  TICES THAT CAUSED THE SPILL.
   18    5.  ANY  DRILLER  OF  NATURAL GAS WHO KNOWINGLY ATTEMPTS TO COVER UP A
   19  SPILL OR PROHIBITED DISCHARGE SHALL BE GUILTY OF A CLASS A  MISDEMEANOR.
   20  ANY DRILLER OF NATURAL GAS WHO KNOWINGLY DISCHARGES HYDRAULIC FRACTURING
   21  COMPOUNDS  INTO  THE  SURFACE  WATERS  OF THE STATE SHALL BE GUILTY OF A
   22  CLASS E FELONY.
   23    6. NOTHING IN THIS TITLE OR ANY OTHER LAW OR REGULATION  SHALL  ALTER,
   24  LIMIT,  IMPAIR  OR  OTHERWISE  AFFECT  THE AUTHORITY OF THE STATE OF NEW
   25  YORK, OR THE AUTHORITY OF THE CITY OF NEW YORK  IN  THE  NEW  YORK  CITY
   26  WATERSHED,  TO  TAKE  WHATEVER  MEASURES  ARE NECESSARY UNDER THE LAW TO
   27  PROTECT THE QUALITY AND SAFETY OF THE SOURCES OF THE DRINKING WATERS  OF
   28  NEW YORK STATE.
   29  S 23-2903. DISCLOSURE OF HYDRAULIC FRACTURING MATERIALS.
   30    1. ALL COMPONENTS OF HYDRAULIC FRACTURING MATERIALS SHALL BE DISCLOSED
   31  TO  THE  DEPARTMENT AT THE TIME OF APPLICATION FOR A WELL PERMIT FOR THE
   32  DRILLING OF NATURAL GAS PURSUANT TO THIS ARTICLE.
   33    (A) EMERGENCY HEALTH SITUATION. WHEN A HEALTH PROFESSIONAL  DETERMINES
   34  THAT A MEDICAL EMERGENCY EXISTS RELATED TO A HYDRAULIC FRACTURING OPERA-
   35  TION  AND  THE INGREDIENTS AND SPECIFIC CHEMICAL IDENTITY OF A HYDRAULIC
   36  FRACTURING FLUID IS NECESSARY FOR EMERGENCY  OR FIRST-AID TREATMENT, THE
   37  HYDRAULIC FRACTURING OPERATOR SHALL IMMEDIATELY  DISCLOSE  THE  SPECIFIC
   38  CHEMICAL  IDENTITY  OF  A  TRADE  SECRET CHEMICAL TO THE TREATING HEALTH
   39  PROFESSIONAL, REGARDLESS OF THE EXISTENCE OF A WRITTEN STATEMENT OF NEED
   40  OR A CONFIDENTIALITY AGREEMENT.
   41    (B) NON-EMERGENCY HEALTH SITUATION.  WHEN  A  HEALTH  PROFESSIONAL  OR
   42  GOVERNMENT  AGENCY DETERMINES THAT THE INGREDIENTS AND SPECIFIC CHEMICAL
   43  IDENTITY OF A HYDRAULIC  FRACTURING  FLUID  ARE  NECESSARY  FOR  MEDICAL
   44  TREATMENT,  AN OPERATOR SHALL DISCLOSE A SPECIFIC CHEMICAL IDENTITY TO A
   45  HEALTH PROFESSIONAL OR GOVERNMENT AGENCY IF A REQUEST HAS BEEN  MADE  IN
   46  WRITING  THAT  DESCRIBES  WITH  REASONABLE  DETAIL ONE OR MORE HEALTH OR
   47  SAFETY NEEDS FOR THE INFORMATION  AND  INCLUDES  A  DESCRIPTION  OF  THE
   48  PROCEDURES  TO  BE USED TO MAINTAIN THE CONFIDENTIALITY OF THE DISCLOSED
   49  INFORMATION. THE HEALTH PROFESSIONAL OR GOVERNMENT AGENCY SHALL AGREE IN
   50  A WRITTEN CONFIDENTIALITY AGREEMENT THAT THE  TRADE  SECRET  INFORMATION
   51  WILL  NOT  BE  USED FOR ANY PURPOSE OTHER THAN THE HEALTH NEEDS ASSERTED
   52  AND SHALL AGREE NOT TO RELEASE THE INFORMATION UNDER  ANY  CIRCUMSTANCES
   53  OTHER THAN TO A HEALTH PROFESSIONAL OR GOVERNMENT AGENCY.
   54    2.  NO NATURAL GAS DRILLER MAY CHANGE THE COMPONENTS OR COMPOSITION OF
   55  HYDRAULIC FRACTURING MATERIALS FROM THOSE SPECIFIED IN ITS PERMIT APPLI-
       A. 8748                             4

    1  CATION WITHOUT FIRST FILING FOR AND RECEIVING  A  MODIFICATION  OF  SUCH
    2  PERMIT.
    3    3.  THE  DEPARTMENT  SHALL ESTABLISH A STANDARD FOR THE COMPOSITION OF
    4  HYDRAULIC FRACTURING COMPOUNDS AND REQUIRE NATURAL GAS DRILLERS  TO  USE
    5  SUCH  STANDARD.  THE DEPARTMENT SHALL HAVE THE POWER TO PROHIBIT THE USE
    6  OF SPECIFIC CHEMICALS IN THE COMPOSITION OF HYDRAULIC FRACTURING MATERI-
    7  ALS.
    8    4. HYDRAULIC FRACTURING LIQUIDS AND LIQUID WASTE FROM DRILLING MAY NOT
    9  BE STORED IN OPEN LAGOONS, BUT MUST BE KEPT IN CORROSION PROOF TANKS.
   10    5. NOTWITHSTANDING ANY OTHER PROVISION OF LAW OR ADMINISTRATIVE DETER-
   11  MINATION, HYDRAULIC FRACTURING MATERIAL SHALL BE REGARDED  AS  HAZARDOUS
   12  WASTE AND TREATED AND DISPOSED OF AS SUCH.
   13    6.  THE  DEPARTMENT  SHALL ISSUE REGULATIONS REQUIRING THE TRACKING OF
   14  ALL CHEMICAL COMPONENTS OF HYDRAULIC FRACTURING MATERIALS AND SHALL HAVE
   15  THE POWER TO ENFORCE SUCH REGULATIONS BY APPROPRIATE FINES AND CEASE AND
   16  DESIST ORDERS.
   17  S 23-2905. PROTECTION OF OTHER ENVIRONMENTAL RESOURCES.
   18    1. DRILLERS OF NATURAL GAS SHALL BE  RESPONSIBLE  FOR  MITIGATING  ALL
   19  DAMAGE  TO  ANY  REGULATED  ENVIRONMENTAL  RESOURCES,  INCLUDING BUT NOT
   20  LIMITED TO AIR, WETLANDS, STREAM CORRIDORS, AND ENDANGERED  AND  THREAT-
   21  ENED SPECIES HABITAT.
   22    2.  WELL  PERMITS FOR THE DRILLING OF NATURAL GAS SHALL NOT BE GRANTED
   23  IN ANY AREA WHERE SUCH DRILLING SHALL ADVERSELY IMPACT THE  RECOVERY  OF
   24  THREATENED  OR  ENDANGERED  SPECIES OR WHERE IT SHALL DESTROY OR DEGRADE
   25  OTHER UNIQUE NATURAL OR SCENIC RESOURCES. WELL PERMITS FOR THE  DRILLING
   26  OF  NATURAL  GAS  SHALL NOT BE GRANTED IN ANY AREA THAT IS DESIGNATED AS
   27  FOREVER WILD UNDER THE STATE CONSTITUTION OR LAWS, IN  STATE  PARKS,  IN
   28  AREAS IDENTIFIED FOR STATE ACQUISITION AND/OR PROTECTION UNDER THE STATE
   29  OPEN SPACE PLAN, OR IN STATE FORESTS AND STATE PARKS.
   30    3.  APPLICATIONS  FOR  A  WELL  PERMIT FOR THE DRILLING OF NATURAL GAS
   31  SHALL  INCLUDE  AN  ASSESSMENT  OF  ITS  IMPACT  ON  LOCAL  BIODIVERSITY
   32  RESOURCES AND A SHOWING THAT SUCH DRILLING SHALL BE WITHIN THE LEASEHOLD
   33  AT  THE  LOWEST  IMPACT  POINT  ON  WILDLIFE. TO MINIMIZE IMPACT THROUGH
   34  EITHER GROUND DISTURBANCE OR TRAFFIC, ALL EFFORTS SHALL BE MADE TO CLUS-
   35  TER WELLS, CENTRALIZE  OPERATIONS,  AND  USE  TELEMETRY.  IF  NECESSARY,
   36  SEASONAL  RESTRICTIONS  SHALL BE IMPOSED TO PROTECT WILDLIFE BREEDING OR
   37  MIGRATION.
   38    4. APPLICATIONS FOR A WELL PERMIT FOR  THE  DRILLING  OF  NATURAL  GAS
   39  SHALL  LIST ALL EXPECTED EMISSIONS OF AIR POLLUTANTS, INCLUDING, BUT NOT
   40  LIMITED TO, ALL GREENHOUSE GASES SUCH AS METHANE. THE  DEPARTMENT  SHALL
   41  HAVE  THE  AUTHORITY  TO  SPECIFY  LIMITS ON ALL SUCH AIR EMISSIONS AS A
   42  CONDITION OF GRANTING SUCH  PERMIT,  TO  REQUIRE  APPROPRIATE  EMISSIONS
   43  MONITORING  AND  CONTROLS  BY THE OPERATOR, AND TO DENY ANY PERMIT WHOSE
   44  OPERATION SHALL BE INCONSISTENT WITH STATE POLICY AND  REGULATIONS  WITH
   45  RESPECT TO ADDRESSING GLOBAL WARMING.
   46  S 23-2907. PROTECTION OF LOCAL RESOURCES.
   47    1.  THE  DEPARTMENT SHALL HAVE THE AUTHORITY TO IMPOSE FEES TO COMPEN-
   48  SATE LOCAL GOVERNMENT FOR ANY COSTS OR IMPACTS IMPOSED UPON SUCH GOVERN-
   49  MENTS AS A RESULT OF DRILLING FOR NATURAL GAS.
   50    2. THE DEPARTMENT, IN ITS PERMITTING DECISIONS,  SHALL  TAKE  CARE  TO
   51  INSURE  THAT  NATURAL GAS WELLS ARE SITUATED IN WAYS THAT MAXIMIZE FIELD
   52  PRODUCTIVITY  WHILE  MINIMIZING  IMPACTS  ON  THE  LANDSCAPE.  FOR  THIS
   53  PURPOSE,  THE  DEPARTMENT MAY, WITHIN SPECIFIC REGIONAL AREAS, ESTABLISH
   54  PROCEDURES TO REQUIRE PERIODIC BATCH PROCESSING OF PERMIT  APPLICATIONS,
   55  INCLUDING  MANDATORY  DATES  FOR  APPLICATION SUBMISSION, AND MAY IMPOSE
   56  WELL CLUSTERING, CENTRALIZED OPERATIONS, AND THE USE OF TELEMETRY.
       A. 8748                             5

    1    3. ALL SITING OF NATURAL GAS DRILLING ACTIVITY SHALL CONFORM TO  LOCAL
    2  ZONING.
    3    4.  ANY  PERMIT  HOLDER  SHALL BE REQUIRED, AT THE END OF ITS DRILLING
    4  OPERATIONS, TO FULLY RESTORE THE DRILL  SITE  TO  ITS  PREVIOUS  NATURAL
    5  CONDITION.  TO  ENFORCE  THE  PROVISIONS OF THIS SUBDIVISION, BEFORE ANY
    6  LAND CLEARING OPERATIONS RELATED TO DRILLING ARE COMMENCED, SUCH  PERMIT
    7  HOLDER  SHALL  FILE  WITH THE DEPARTMENT, A NON-REVOCABLE AND BANKRUPTCY
    8  PROOF BOND SUFFICIENT, UNDER REGULATIONS TO BE ISSUED BY THE DEPARTMENT,
    9  TO COVER ALL FORESEEABLE COSTS OF SITE RESTORATION.
   10    5. GAS DRILLING OPERATIONS SHALL BE CONDUCTED IN A MANNER  THAT  SHALL
   11  NOT  BURDEN  ADJACENT LANDOWNERS AND RESIDENTS. NO NOISE AUDIBLE INDOORS
   12  IN RESIDENCES LOCATED ON ADJACENT PROPERTY SHALL  BE  PERMITTED  BETWEEN
   13  THE HOURS OF 8:00 PM AND 8:00 AM ON WEEKDAYS AND 6:00 PM AND 10:00 AM ON
   14  WEEKENDS. SIMILARLY, NIGHT LIGHTING SHALL NOT BE OBTRUSIVE OR DISRUPTIVE
   15  OF LIFE FOR SUCH ADJACENT LANDOWNERS AND RESIDENTS. THE DEPARTMENT SHALL
   16  ENFORCE  THE  PROVISIONS  OF THIS SUBDIVISION BY APPROPRIATE REGULATIONS
   17  INCLUDING A SYSTEM OF FINES, AND SHALL FURTHER HAVE THE POWER  TO  ISSUE
   18  CEASE  AND  DESIST  ORDERS  TO ENFORCE THESE PROTECTIONS AND PROTECT THE
   19  QUIET ENJOYMENT OF LOCAL RESIDENTS.
   20    6. LANDOWNERS FORCED INTO A  PRODUCTION  POOL  SHALL  BE  ENTITLED  TO
   21  RECEIVE THE HIGHEST PAYMENT THAT ANY OTHER POOL MEMBER RECEIVES.
   22    7.  ANY  LANDOWNER  WHO  ENTERS INTO A CONTRACT OR LEASE TO PERMIT THE
   23  DRILLING FOR NATURAL GAS ON SUCH LANDOWNER'S PROPERTY SHALL HAVE A THIR-
   24  TY DAY RIGHT OF RECISSION WITH RESPECT TO  SUCH  CONTRACT.  DURING  SUCH
   25  THIRTY  DAY  PERIOD, SUCH LANDOWNER MAY CANCEL SUCH CONTRACT OR LEASE AT
   26  ANY TIME WITHOUT PENALTY.
   27    8. NO WELL PERMIT FOR THE DRILLING OF NATURAL GAS SHALL BE GRANTED FOR
   28  A PERIOD LONGER THAN TEN YEARS. ANY PERMIT UNDER  WHICH  ACTUAL  NATURAL
   29  GAS  EXTRACTION  IS NOT UNDERTAKEN WITHIN FIVE YEARS SHALL EXPIRE AND BE
   30  DEEMED NULL AND VOID.
   31    9. THE DEPARTMENT, IN CONSULTATION WITH THE  ATTORNEY  GENERAL,  SHALL
   32  ISSUE  GUIDANCE  DOCUMENTS  TO  LANDOWNERS, WITH RESPECT TO THEIR RIGHTS
   33  WITH RESPECT TO NATURAL GAS DRILLING CONTRACTS AND LEASES.  THE  DEPART-
   34  MENT  IS  HEREBY  AUTHORIZED  TO  REQUIRE  STANDARD  PROVISIONS  IN SUCH
   35  CONTRACTS OR LEASES IN ORDER TO PREVENT UNFAIR TREATMENT OF LANDOWNERS.
   36    10. NOTWITHSTANDING ANY OTHER PROVISION OF LAW, NATURAL  GAS  DRILLERS
   37  SHALL  BE  RESPONSIBLE  FOR  THE COSTS OF ALL ENVIRONMENTAL DAMAGE WHICH
   38  OCCURRED IN THE PROCESS OF DRILLING FOR AND EXTRACTING NATURAL GAS.  THE
   39  DEPARTMENT  MAY  REQUIRE THE PROVISION OF APPROPRIATE FINANCIAL SECURITY
   40  TO ENSURE LANDOWNERS ARE PROTECTED FROM ANY CONTINGENT LIABILITY. SHOULD
   41  DRILLING ACTIVITY LEAD TO DESIGNATION AS A BROWNFIELD SITE,  AS  DEFINED
   42  IN SUBDIVISION TWO OF SECTION 27-1405 OF THIS CHAPTER, SUCH DRILLER, NOT
   43  THE LANDOWNER, SHALL BE CONSIDERED TO BE PARTY IN THE CHAIN OF RESPONSI-
   44  BILITY.
   45  S 23-2909. WATER WITHDRAWALS.
   46    ALL  SURFACE  OR  GROUNDWATER  WITHDRAWALS  OF MORE THAN FIVE THOUSAND
   47  GALLONS A DAY FOR NATURAL  GAS  DRILLING  PURPOSES,  OR  MORE  THAN  ONE
   48  PERCENT  OF  IN STREAM FLOW, SHALL REQUIRE A PERMIT FROM THE DEPARTMENT.
   49  THE DEPARTMENT  SHALL  ISSUE  REGULATIONS  GOVERNING  SUCH  WITHDRAWALS,
   50  INCLUDING  PROVISIONS  TO  ASSURE  THAT WATER WITHDRAWALS ARE LIMITED TO
   51  LEVELS THAT DO NOT HARM STREAM ECOLOGY OR FISHERY RESOURCES.
   52  S 23-2911. ENFORCEMENT AND FINANCIAL SECURITY.
   53    1. NO PERMIT FOR THE DRILLING OF NATURAL GAS SHALL BE GRANTED IF  SUCH
   54  APPLICANT HAS FAILED TO MEET HIS ENVIRONMENTAL AND FINANCIAL OBLIGATIONS
   55  UNDER  A  PREVIOUS  PERMIT  OR  IF  SUCH  APPLICANT HAS UNPAID FINANCIAL
       A. 8748                             6

    1  LIABILITIES TO EITHER THE STATE, A LOCAL GOVERNMENT OR A  PRIVATE  LAND-
    2  OWNER.
    3    2.  IN DETERMINING WHETHER OR NOT A PERMIT FOR THE DRILLING OF NATURAL
    4  GAS SHALL BE GRANTED, THE DEPARTMENT SHALL  CONSIDER  THE  PRIOR  RECORD
    5  UNDER  PREVIOUS  PERMITS  OF  THE APPLICANT. APPLICANTS WHO HAVE SHOWN A
    6  PATTERN OF VIOLATION OF PERMIT CONDITIONS OR A LACK OF A PROPER STANDARD
    7  OF CARE IN DRILLING OPERATIONS SHALL NOT BE GRANTED A PERMIT.
    8    3. A PERMIT FOR THE DRILLING OF NATURAL GAS SHALL  INCLUDE  APPLICABLE
    9  LEASE  DOCUMENTS BETWEEN THE DRILLING COMPANY AND THE LANDOWNER OR LAND-
   10  OWNERS FOR THE DRILLING SITE FOR WHICH THE APPLICATION IS MADE.
   11    4. A PERMIT APPLICATION SHALL  INCLUDE  A  COMPREHENSIVE  HYDROLOGICAL
   12  ASSESSMENT  OF  THE  SUBSURFACE  STRATA  INCLUDING THE POTENTIAL FOR ANY
   13  FISSURING THAT WOULD DRAW HYDRAULIC FRACTURING  FLUID,  NATURAL  GAS  OR
   14  OTHER POLLUTANTS INTO WATER BEARING AQUIFER STRATA.
   15    5.  THE  DEPARTMENT  SHALL  PROVIDE FOR UNANNOUNCED INSPECTIONS OF ALL
   16  NATURAL GAS DRILLING SITES AND FOR THE  PROVISION  OF  SOIL  TESTING  TO
   17  DETERMINE THE PRESENCE OF UNREPORTED SPILLS.
   18    6.  THE  DEPARTMENT  SHALL  REQUIRE  THAT  ALL  CASING CONSTRUCTION BE
   19  CARRIED OUT IN THE PRESENCE OF INDEPENDENT  QUALITY  CONTROL  ENGINEERS.
   20  THE  DEPARTMENT SHALL HAVE THE AUTHORITY TO SPECIFY STANDARDS FOR CASING
   21  CONSTRUCTION, INCLUDING COMPOSITION  OF  CONCRETE  AND  OTHER  TECHNICAL
   22  PARAMETERS FOR DEEP WELL CONSTRUCTION TO INSURE MAXIMUM CASING INTEGRITY
   23  AND  PREVENT  LEAKAGE OF HYDRAULIC FRACTURING COMPOUNDS, NATURAL GAS AND
   24  OTHER SUBSURFACE MATERIALS INTO WATER  BEARING  STRATA.  THE  DEPARTMENT
   25  SHALL,  OVER  THE  LIFE  OF  THE WELL, CARRY OUT PERIODIC INSPECTIONS TO
   26  ENSURE THAT CASING INTEGRITY IS MAINTAINED.
   27  S 23-2913. OTHER PROVISIONS.
   28    1. THE STATE COMPTROLLER SHALL ANNUALLY AUDIT ALL ROYALTY PAYMENTS  TO
   29  THE  STATE AND LOCAL GOVERNMENTS, INCLUDING THE GAS PRODUCTION AND SALES
   30  FIGURES ON WHICH THEY ARE BASED, AND SHALL HAVE THE AUTHORITY TO REQUIRE
   31  APPROPRIATE FISCAL REPORTING AND RECORD  KEEPING  BY  BOTH  NATURAL  GAS
   32  PRODUCERS  AND  OTHER DEPARTMENTS OF STATE GOVERNMENT CHARGED WITH THEIR
   33  SUPERVISION.
   34    2. THE STATE COMPTROLLER SHALL  HAVE  THE  AUTHORITY  TO  PERIODICALLY
   35  AUDIT PAYMENTS MADE UNDER DRILLING CONTRACTS AND LEASES TO PRIVATE LAND-
   36  OWNERS, INCLUDING THE GAS PRODUCTION AND SALES FIGURES ON WHICH THEY ARE
   37  BASED,  TO  DETERMINE THAT THEY ARE IN COMPLIANCE WITH THE PROVISIONS OF
   38  THE CONTRACT OR LEASE AND ALL APPLICABLE LAWS.
   39    3. THE DEPARTMENT SHALL  ESTABLISH  AN  IMPARTIAL  TECHNICAL  ADVISORY
   40  COMMITTEE, WHOSE RESEARCH AND WORK SHALL BE SUPPORTED BY PERMIT FEES, TO
   41  REVIEW  AND  ISSUE  GUIDANCE  DOCUMENTS  ON GAS DRILLING BEST PRACTICES.
   42  SUCH COMMITTEE SHALL  INCLUDE  AT  LEAST  ONE  REPRESENTATIVE  FROM  THE
   43  FOLLOWING  INTEREST  GROUPS:  THE  ENVIRONMENTAL  COMMUNITY;  THE PUBLIC
   44  HEALTH COMMUNITY; AND THE GAS DRILLING INDUSTRY, ALONG WITH PERSONS FROM
   45  THE DEPARTMENT OR OTHERS THE DEPARTMENT DEEMS APPROPRIATE.  THE  DEPART-
   46  MENT MAY REQUIRE COMPLIANCE WITH SUCH PRACTICES AS A CONDITION OF PERMIT
   47  APPROVAL.
   48    S 3. This act shall take effect on the one hundred twentieth day after
   49  it shall have become a law, provided, however, that effective immediate-
   50  ly,  the  addition,  amendment  and/or  repeal of any rule or regulation
   51  necessary for the implementation of this act on its  effective  date  is
   52  authorized to be made and completed on or before such date.

____________________________________________________________________________________________

                    DEC Final Scope

The DEC has just released the Final Scope that outlines the topics that will be reviewed in the SGEIS (Supplemental Generic Environmental Impact Statement), expected out sometime this spring.

The SGEIS will analyze the potential impacts of shale gas development using horizontal drilling and high-volume hydraulic fracturing, with particular attention to issues associated with multi-well drilling sites. Heightened attention to the latter topic is a direct result of the scoping process, which also resulted in the following significant additions to the scope:

• Effectiveness of regulations in other oil and gas producing states where high-volume hydraulic fracturing of shale and other low-permeability reservoirs is used.

• Setbacks for multi-well sites and high volume hydraulic fracturing operations from private dwellings or buildings, surface waterbodies, private water wells and springs used for domestic water supply.

• Potential requirements for private water well sampling, testing and monitoring by gas well operators.

• Feasibility analysis of requiring use of green or non-chemical fracturing technology.

• Mechanisms to require notification, review and Department approval of re-fracturing operations.

• Specific air quality topics.

• Evaluation of a phased permitting alternative to the proposed action.

 

Additional background information was also added to the scope regarding topics which do not require analysis in the SGEIS because the Department already has programs in place to address them.

 

Lastly, the Final Scope also identifies “prominent issues that were raised during scoping and determined to be not relevant or not environmentally significant or that have been adequately addressed in a prior environmental review.” [6 NYCRR 617.8(f)(7)]

 

The volume and breadth of the comments received and their careful consideration allows the Department to issue this Final Scope with confidence that the SGEIS will address all relevant potentially significant adverse impacts. The Final Scope will be followed in the Spring of 2009 with a draft SGEIS, and you will have an opportunity to provide comments on that document as well.

__________________________________________________________________________________

                                        DEC Final Scope

 DEC Finalscope.pdf

_________________________________________________________________________________

Review of gas drilling 'on track': State expects process to be completed this summer

 by Tom Wilber, Staff Writer   February 16, 2009

 A review of regulations associated with natural gas drilling is on schedule to be completed this summer,  and that could clear the way for energy companies to begin work in the Southern Tier.   

Efforts to tap natural gas from the Marcellus Shale deposit were put on hold last summer while the state Department of Environmental Conservation  assessed drilling's impact on water, the landscape and communities.  

Officials completed another major step in that review earlier this month that laid the groundwork for a regulatory overhaul to oversee a surge in drilling  volume and intensity expected with the Marcellus.  

"We remain on track to complete this process in the summer," Lori Severino, a spokeswoman for the DEC, said last week.  George Miner, president of Southern Tier Economic Growth in Chemung County, said he hopes the move toward completing  the review results in adoption of regulations that would allow Marcellus drilling in New York, much like is taking place in Pennsylvania now. 

"If that goes through, we'll be back to creating a lot of jobs here," he said

One of those sources of jobs would be Schlumberger Technology Corp., a Houston-based company in the gas exploration field that has purchased 87 acres in The Center in Horseheads for a complex where at least 300 people would work.

Miner said approval of the regulations would speed up Schlumberger's construction timetable.

"They're still going ahead with the project to service Pennsylvania from here," Miner said, "but if New York state allows gas drilling to resume, it will just be a bigger project with more jobs."

 http://www.stargazette.com/article/20090216/NEWS01/902160307/

___________________________________________________________________ 

Marcellus Shale land lull settles in                                   

Natural gas companies plan to acquire fewer leases in 2009 

Friday, January 16, 2009                                                                                                      Pittsburgh Business Times - by Anya Litvak

No one’s knocking on Gary Sheppard’s door. And judging from the calls he gets as a gas lease educator, no one’s knocking on doors anywhere else.

The land grab in the promising Marcellus Shale has been silenced by a more pressing need: cash.

“Which makes sense because the sheer dollars going around were monstrous,” Sheppard said. “We saw them hit that $3,000 per acre mark. We saw royalty rates change. We heard 17, 18, 19 percent. Of course, we don’t hear anything now. It’s quiet as a mouse.”

For many oil and gas companies looking to secure their fortune in the natural gas reservoir that spans most of the state, the strategy was to grab first and develop later.

Of the estimated $4 billion that has gone into the Marcellus gas play so far, almost three quarters went to land acquisition, said Louis D’Amico, executive director of Pennsylvania’s Independent Oil and Gas Association. Hundreds of thousands of leases were signed, most of them good for five years with all the money paid up front, though the large sums await landowners through royalties, when the gas begins flowing.

BALANCING ACT

But as credit markets collapsed, oil and gas companies no longer had the option of accumulating nonproducing resources at the same rate. A common phrase for 2009 prospectives became “balancing the balance sheet.”

Chesapeake Energy Corp., the nation’s largest natural gas producer and the biggest leaseholder in the Marcellus Shale, drafted a 2009 budget with a $2.2 billion, or 78 percent, reduction in acquisition dollars from last year’s allocation.

Marcellus Shale acreage runner up Range Resources said it will shift its focus on development, cutting leasehold dollars by two-thirds this year. Range currently has 900,000 acres of leased land in Pennsylvania.

“The economy as a whole is experiencing difficult times and companies are being more selective in leasing,” said Ray Walker, vice president of the Appalachia Shale division of Range Resources, in an e-mail.

Denver-based St. Mary Land & Exploration Co., while cautiously announcing its entry into the Marcellus Shale field, told investors it will slash its 2009 exploration and development budget by 54 percent of the 2008 figure.

At least one company is pulling out all together. Canadian-based Unbridled Energy Corp., which set up an office in Sewickley and shelled out a half a million dollars for oil and gas leases in Tioga county, said in late December that it would abandon the venture, along with its interest in 8,000 acres of the Marcellus Shale play, citing “dramatic changes in both the oil and gas industry and the national economy, combined with the extremely tight capital markets.” Instead, the company will focus on developing already held properties in New York.

It is the liquidity crisis, in part, that spurred Moon Township-based Atlas America to “significantly” cut its acquisition budget for 2009, said company President Rich Weber, who declined to disclose a dollar figure for the cuts. “We are still actively seeking additional leases,” in areas strategic to the company’s Marcellus Shale portfolio, he said.

A TEMPORARY ROADBLOCK?

Weber, like others in the field, understands that the lull is not a permanent state. The plunge in energy prices will level and climb back up, said EOG Resources CEO Mark Papa, speaking at last month’s Deloitte Oil & Gas Conference.

“Worldwide oil supply growth prospects are weak and, within five years, oil prices will likely be much higher than today,” his slide show warned.

And while the long-term perspective may soothe long-term worries, gas prices and oil and gas company portfolios are changing to accommodate today.

EOG, one of the largest land holders in the Marcellus Shale, announced Jan. 8 that it will reveal revised production growth targets in February, “due to the current uncertainty in hydrocarbon markets.”

Locally, the good news is that land lulls have spread across the nation.

A few months ago, Bob Dawson, the mid-continent client relations manager with the Texas-based Oil and Gas Clearinghouse, brokered deals where energy companies gobbled up land in Louisiana’s Hainesville Shale at $30,000 per acre.

But just a few days ago, when he tried to unload a property in the same southern rock bed, Dawson couldn’t fetch a single bid.

Frankly, he said, “there was a period of time, six to eight months ago, when people were just way overpaying. You spend $30,000 an acre and you have to drill an $8 (million) to $12 million well.”

Sheppard, who serves as Penn State Extension’s Westmoreland County director, now fields calls from landowners looking to get someone, anyone, interested in leasing their land. He has no answer.

“If the industry is saying ‘Hey, we’ve gotta focus on creating cash flow right now,’ you can understand that,” he said.

 

http://washington.bizjournals.com/washington/othercities/pittsburgh/stories/2009/01/19/story1.html?b=1232341200%5E1762126