PA Gov. Tom Wolf has promised more clean energy & green jobs

From an Article by Jamison Cocklin, Natural Gas Intelligence, January 4, 2019

Pennsylvania is preparing to collect a windfall from hundreds of shale gas wells and their operators after the state Supreme Court recently issued an opinion resolving a dispute over the definition of stripper wells that aren’t required to pay impact fees.

The state Public Utility Commission (PUC) is working to generate invoices for producers that have disputed and not paid impact fees while the case was unfolding, spokesman Nils Hagen-Frederiksen told NGI’s Shale Daily on Thursday. The PUC estimates that the recent court decision “will involve hundreds of wells with outstanding impact fees totaling millions of dollars.”

The Supreme Court overturned a lower court’s decision and essentially reinstated a 2016 order from the PUC that directed Pennsylvania-based Snyder Brothers Inc. to pay nearly $500,000 in impact fees, interest and penalties for failing to identify and pay them for 24 vertical wells targeting the Marcellus Shale in 2011 and 21 wells in 2012. The parties were at odds over how state law defines stripper wells.

Snyder claimed that the state’s definition of a stripper well, specifically, an “unconventional gas well incapable of producing more than 90 Mcf/d during any calendar month,” meant that the company did not have to pay the fees and charges, if the well failed to reach the 90 Mcf/d threshold for any single month during the year.

The PUC has claimed that a well is not a stripper well and is subject to the impact fee if it exceeds minimum production levels in one calendar month in a year. Siding with Snyder, the Commonwealth Court concluded that the word “any” in the definition unambiguously means “any” or “one” and not “all” or “every” month as the PUC had argued.

Essentially, the argument surrounded whether a well must produce below the 90 Mcf/d threshold for one month of the year or for every month of the year to be a stipper well. If the Commonwealth Court’s decision to uphold Snyder’s interpretation of the law stood, opponents were concerned that producers would manipulate production by turning down their volumes below the threshold for one month every year to avoid paying impact fees.

The PUC appealed to the Supreme Court arguing that the Commonwealth Court’s decision contradicted both the meaning of the law and the intention of the General Assembly.

The state’s high court found that wells producing below the 90 Mcf/d threshold every month of the year are stipper wells. It ruled that the word “any” has multiple meanings, leaning instead on the legislature’s intent to craft an effective and certain bill that is not “absurd” or “impossible” to execute when it passed the legislation.

“There are approximately 17 producers with a varying number of wells and reporting years that owe impact fees for stripper well activity,” Hagen-Frederiksen said when asked how many producers might be affected by the case and how much they owe. “At this time, we do not have a final total, but those figures will become clearer in the coming weeks as invoices are generated and payments are collected from these disputed wells.”

General counsel Kevin Moody of the Pennsylvania Independent Oil and Gas Association (PIOGA), said more producers could be involved as the PUC’s figure is likely outdated and from 2017. Last year’s impact fees, which are self-reported and paid by producers annually, aren’t due until April 1.

PIOGA joined Snyder in opposing the PUC’s 2016 order. Moody said the trade group plans to ask the state Supreme Court to reconsider its decision because the PUC’s legal position on the stripper well definition has changed since it issued the order years ago. He also said the court failed to address other aspects of the Snyder case, such as the PUC’s rejection of the company’s offer to escrow the disputed funds while the matter was being resolved.

He added that there is no refund mechanism in the impact fee statute that would allow the money to be returned if the company had successfully argued its case anyhow, forcing the company to choose between paying the fees or a fine for nonpayment.

The impact fee is levied on all unconventional wells in the state during their first 15 years of operation if they produce above the stripper threshold. The fee schedule and the amount companies must pay for each well depends on the number of years they’ve produced. Since it was enacted in 2012, the state has collected more than $1.4 billion in fees for distribution to local communities and state agencies.

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Pennsylvania proposes methane rules for existing wells, facilities

From an Article of Kallanish Energy News, December 17, 2018

The Pennsylvania Department of Environmental Protection has rolled out a draft plan to curtail air emissions from thousands of existing oil and natural gas wells — a move that could have a major and costly impact on drillers.

The state is expected to take public comment on the proposal early next year.

The proposal is part of Gov. Tom Wolf’s 2016 strategy to reduce methane emissions, a powerful greenhouse gas that may leak from wells and other facilities. Last August, Pennsylvania adopted regulations on air emissions from new wells and other facilities.

The new 84-page draft plan that covers existing wells, compressor stations, storage tanks, pneumatic controllers and pumps at wells sites, processing plants and gathering stations, was released last week by the PA DEP.

Environmental groups are pleased to see some activity and recognition of the problems. The industry expressed concerns about the added cost and the timing of the state plan, while the plan was hailed by environmental groups including the Environmental Defense Fund.

“We want to make sure that all oil and gas sources are well-controlled in a reasonable manner to make sure we can keep emissions reduced as low as possible,” George Hartenstein, deputy secretary for Waste, Air, Radiation and Remediation, told media outlet StateImpact Pennsylvania.

The new rules mainly target volatile organic compounds (VOCs) that can be harmful to human health and also contribute to unhealthy ozone or smog. State officials say stricter limits on VOCs will also prevent methane from escaping. Both VOCs and methane are found co-mingled in natural gas.

Leak detection certainly could be increased. The proposed rules would increase leak detection to quarterly and, in some cases, require better controls to prevent emissions from escaping at wells and other facilities.

Low-producing wells are exempt from the proposed rules. It would maintain the state’s stricter standards for tanks installed after August 2013.

The impacts would be large because of the number of existing Marcellus Shale wells in Pennsylvania. Nearly 7,000 shale wells were drilled in Pennsylvania before the state adopted emission limits from new wells in August 2013. Another 4,400 shale wells were drilled before PA DEP updated its air pollution rules for new wells last August.

Trump administation is moving in the opposite direction. The state’s move comes at a time when the Trump administration is proposing to rollback VOC rules. For that reason, the Pennsylvania energy industry has suggested the state postpone taking any action until the federal changes are implemented.

There is concern Pennsylvania’s stricter rules could create a disadvantage compared to other shale states. The draft plan is available from Pennsylvania Government here.

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Western PA Counties support human services funding

From an Article by Christine Haines, Uniontown Herald Standard, March 14, 2015

Commissioners in the four-county area are taking a stand in support of continuing funding for human services even in the face of a future state budget impasse.

The Washington, Greene and Westmoreland county commissioners have adopted resolutions proposed by the County Commissioners Association of Pennsylvania (CCAP), with the Fayette County commissioners expected to adopt a similar resolution next week.

“Our payments are behind for CYS (Children and Youth Services),” said Vince Vicites, chairman of the Fayette County commissioners. “With our budget that we just passed, as least $8 million is state funded from a $32 million budget. That’s a lot of money that we have to bridge until a budget is passed.”

According to the resolution passed in Washington County, the county has tapped into reserves, borrowed funds or suspended payments to vendors, as well as limiting travel and reducing hours in order to continue to provide client services. Washington County has spent $3 million in reserves to keep human services going that are normally covered by state funding.

The letter sent to the governor and the legislators also calls for a restoration of the 10 percent in funding cut from seven key human services budget line items in the 2012-13 budget and not restored. Larry Maggi, chairman of the Washington County commissioners, said Washington county has been able to make it this long without state funding because of money from the Marcellus shale gas industry, but it’s time for officials in Harrisburg to take responsibility.

“The legislature and everyone needs to get down to doing what they are elected to do. They are holding all of us hostage, especially human services. We are able to hold out longer because of the gas money, but there is a limit. We can’t keep funding them from our reserves. Other counties have it even worse,” Maggi said. “It’s an election year and we still can’t get them to move.”

Greene County also opted to put Marcellus shale gas money toward human services operations, according to Karen Bennett, the county’s human services director, and also took out a tax anticipation note to keep services going. “We were restricting travel and training,” Bennett said.

According to Bennett, training was limited to what was required for caseworkers to maintain their credentials, and programs that normally involved two monthly home visits were cut back to one visit if that was all that was required by law.

Positions required by law were filled, while others fell under a hiring freeze.

“If we have to face this again, I’m not certain what’s going to happen,” Bennett said.

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West Virginia Governor Tomblin says work to stop on state budget due to new estimates

Charleston, WV, WVAH News 11 (WCHS/WVAH/AP) — With coal and natural gas tax money dwindling, West Virginia lawmakers are finishing a budget session without a spending plan. In a news release Tuesday, Gov. Earl Ray Tomblin said he’ll send lawmakers home and bring them back later this spring. The new budget year starts July 1.

The Republican-led Legislature returned Monday to negotiate a budget with a gap initially pegged at $466 million. Revenue Secretary Bob Kiss estimated revenues will be $92 million lower.

The House budget used $32 million from Rainy Day Fund reserves, $17 million in extra cuts and $72 million from agency accounts. The Democratic governor has said he’ll veto a budget tapping reserves.

Senators proposed $115 million through higher tobacco taxes and $20 million by eliminating greyhound racing subsidies not approved by the House.

In a joint news release, Senate President Bill Cole, R-Mercer, and House Speaker Tim Armstead, R-Kanawha, reacted to the new revenue projections, saying the Legislature will come back at a later date to come up with a new plan to balance the budget.

“Our economy is facing tremendous challenges due to the War on Coal and declines in natural gas markets. Our state’s budget situation is a result of that,” Cole said. “We have worked diligently during the 60-day session to craft a balanced budget, and were prepared to pass a budget today based on the administration’s original revenue projections.”

Armstead said lawmakers had no choice but to come back later to tackle the budget. He said lawmakers “remain committed to passing a balanced budget based on the new revenue estimates, and urge the governor to call us into session in a responsible timeframe to do so. If not, we will work to call ourselves into special session in ample time to pass a fiscal year 2017 budget that responsibly funds our government, and fully funds PEIA.”

Cole said regardless of how the state ended up in this situation, it will take the work of both the executive and the legislative branch to address it.

“Now that we have a more accurate revenue estimate, we absolutely must work to get our fiscal house in order and control the size of government while meeting essential obligations, especially to our state employees by fully funding PEIA,” Cole said. “At this point, across-the-board cuts aren’t enough to fix this situation. It is going to require tough, targeted reductions, and I believe those can be found in Charleston not in our State Police barracks or classrooms.”

Armstead said West Virginia residents are having a hard time making ends meet, and state officials must work together in the coming weeks to produce a balanced, responsible budget that “addresses the needs of our fellow West Virginians and at the same time does not place additional undue burdens on our hard-working citizens.”

….. More Information …..

The governor said in a news release that the West Virginia Department of Revenue on Tuesday provided the Legislature with updated estimates for fiscal year 2017. New estimates were lowered by about $240 million, which reflects $148 million in proposed tax increases that were not passed by the Legislature during the regular legislative session. It also reflects an additional $92.4 million reduction in estimates to account for the continued downturn in global energy markets, which is affecting West Virginia and several other energy-producing states, Tomblin said.

Tomblin said the new projected general revenue budget for fiscal year 2017 is $4.09 billion.

“Because these updated figures further complicate an already difficult budget process, legislators will stop work on the fiscal year 2017 budget today,” Tomblin said. “I urge all 134 members of the Legislature to come to the table with a willingness to work with my administration to find a responsible solution to be considered later this spring. Together, we must agree to a responsible budget that takes these major changes into account while maintaining the critical services on which so many residents rely.”

Lawmakers had returned to the Capitol this week for a three-day special session after they were unable to reach a budget consensus at the close of the regular session Saturday.

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See also: www.FrackCheckWV.net

To: WV Legislature; From: Steve Conlon (Wetzel County, WV)

Subject: Rebuilding gas industry impacted roads

Sent via Email:  January 23, 2015

It is encouraging to see some concern about our gas-industry impacted roads. HB 2080 is obviously a response to this need,  a condition and a situation which is beyond the abilities of the WV Departent of Highways to rectify. Thank you for being concerned!

Some of you know me. I’ve lived in Wetzel County on a gravel/dirt road for 42 years which has given me ample time to study roads, geography and bureaucracy. Wetzel/Marshall road history could be accurately divided into  BC (before Chesapeake Energy) and AC (after Chesapeake Energy). It has now been 8 years since gas industry activity started here. Certainly we’ve “seen it all here”. Roads have been destroyed, widened, rebuilt. Sharp curves have been removed. Some homes have been removed.

Some of our roads have been in terrible condition for years and have been repaired to a much higher quality than before. Typically asphalt secondary roads get downgraded to gravel patches which are dusty and muddy. Road maintenance gets passed from the DOH to gas company sub-contractors.

Since District 6 DOH is between 50-70 employees short, we see little supervision or prodding. Few people complain or speak up. Those who do find a circuitous path to little action.

Obviously, the State is not charging the gas companies the correct amount for using our roads. HB2080 gets us the money, but it takes it out of our own pocket. If the severance tax is our profit, why should we spend it on damages they incurred. In 2007, the WV Department of Environmental Protection and the Department of Highways had no idea what the “road bill” (cost) would be for each well. Now we know how many trucks, what size, what weight, and how many trips. This information can be combined with a study of the access roads to each pad  and a “road impact fee” can be calculated for every gas well. This is a very simple business calculation. The DEP and the DOH have all this information.

I have been outspoken for several years concerning funding for our road system. We are currently experiencing low fuel prices which gives legislators a perfect window for correcting inadequate road funding. Recently I have heard many “creative” funding scenarios which are seriously worrisome. I watched the Governor’s so called Blue Ribbon Commission on Highways run “dog and pony” shows and then submit a report of little value.

Fees are not taxes. We need to own up to fees. We need to very calmly have the nerve to charge the gas industry companies for their road impacts. And, I am willing to pay more for my vehicular impact. Now is the time. Bury HB 2080. Let’s try a different angle.

Thanks, I appreciate the job you do for West Virginia.

Steve Conlon, Thistledew Farm, RR 1 Box 122, Proctor, WV 26055

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See also:  www.FrackCheckWV.net and www.Marcellus-Shale.us