April 2015 • Issue 60

The

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

(Continues on page 4)

®

By Jean M. Mosites, Esq. Babst Calland

On April 4, the PennsylvaniaDepartment of Environ mentalProtection (DEP) published an

Advance Notice of Final Rulemaking(ANFR) in the Pennsylvania Bulletin. TheANFR solicits comments on changes DEPis recommending to 25 Pa. Code Chapter 78, Subchapter C,which provides environmental protection standards for oil andgas operations. The Environmental Quality Board (EQB) hadpreviously published revisions to Chapter 78 on December 14,2013, accepting comments for 90 days through March 14, 2014.The EQB received more than 24,000 comments to that proposaland DEP has reviewed and responded to those comments in thecurrent draft final rules. DEP intends to present its final rules toEQB by the end of 2015, to be effective in the first quarter of2016.

PIOGA has participated in this important rulemaking processsince 2012 and provided extensive comments to the 2013 pro-posed rule. Those prior comments can be reviewed, along withall other submitted comments, on the website of the IndependentRegulatory Review Commission, which also provided its own setof comments to the rulemaking proposal, in accordance with theRegulatory Review Act(www.irrc.state.pa.us/regulations/RegSrchRslts.cfm?ID=3052).

One significant difference between the 2013 proposal and the2015 draft final rule is that DEP has separated Chapter 78 intotwo rules—Chapter 78a would apply to unconventional opera-tions and Chapter 78 would apply to conventional operations.DEP is requesting that comments be submitted separately foreach chapter to aid in the comment review and response.

DEP publishes an Advance Notice of Final Rulemakingfor revisions to 25 Pa. Code Chapter 78, Subchapter C

In the ANFR, DEP listed several new sections of the draftfinal rules that it considers to be “significant changes” from the2013 proposed rule. Such changes applicable to both convention-al and unconventional wells include:

• The requirement to restore impacted drinking water suppliesto Safe Drinking Water Act standards or predrill quality(whichever is better).

• The elimination of the use of pits to store production fluidsat well sites.

• A new proposal to authorize centralized tank storage.• The expansion of predrilling assessments to include the

identification of nearby active and inactive wells.• Revisions to the obligation to identify abandoned and

orphan wells.• New obligations for site restoration beyond the requirements

of Chapter 102.• A new requirement to remediate spills or releases at well

sites in accordance with Act 2 under a timeframe uniquely creat-ed for oil and gas operations.

Changes specific to unconventional operators include anentirely new noise mitigation provision, a prohibition on the useof temporary waste storage pits and the option to obtain approvalfor disposal of waste at unconventional well sites.

“Other critical communities”One significant revision that applies to both conventional and

unconventional operations is the new definition of “other criticalcommunities,” which would be defined as:

(1) Plant and animal species that are not listed as threat-ened or endangered by a public resource agency, including:

(i) Plant and animal species that are classified as rare,tentatively undetermined or candidate;

(ii) Taxa of conservation concern; and(iii) Special concern plant populations.(2) The specific areas within the geo-graphical area occupied by a threatenedor endangered species designated inaccordance with the EndangeredSpecies Act of 1973, 16 U.S.C. § 1531,et seq., that exhibit those physical andbiological features essential to the con-servation of the species and which mayrequire special consideration or protec-tions; and

New DEP advisory group members . . . . . . . . 4Coming up: PIOGA Summer Picnic . . . . . . . . 7Wolf’s severance tax plan: It gets worse. . . . . 9Bat receives threatened status . . . . . . . . . . . 10DEP seeks pipeline strategy. . . . . . . . . . . . . 10Members shine at Oil & Gas Awards . . . . . . 12Lou D’Amico’s Oil & Gas Awards speech . . . 13Zoning ordinance challenges persist . . . . . . 15Doctor loses Act 13 lawsuit. . . . . . . . . . . . . . 17March Spud Report. . . . . . . . . . . . . . . . . . . . 18Research, industry and academia . . . . . . . . 22

Proposed standards encourage gas use . . . 23Is your regulatory house in order? . . . . . . . . 24How to select your rescue team . . . . . . . . . . 26Member Profile: RNDT, Inc. . . . . . . . . . . . . . 29Monthly production reporting begins . . . . . . 29New well transfer procedures . . . . . . . . . . . . 30Oil & Gas Trends. . . . . . . . . . . . . . . . . . . . . . 32New members. . . . . . . . . . . . . . . . . . . . . . . . 34Calendar of Events . . . . . . . . . . . . . . . . . . . . 34PIOGA contacts . . . . . . . . . . . . . . . . . . . . . . 34

Page 2 The PIOGA Press

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Chapter 78 revisions: Continued from page 1

(3) Significant non-species resources, including uniquegeological features, significant natural features or signifi-cant natural communities.

This definition—which expressly includes all species that arenot listed as threatened or endangered, as well as various non-species resources—would come into play in the well permitapplication process, where applicants would be required to givenotice to public resource agencies “responsible for managing”the locations of these critical communities. See proposed §78.15(f)(1-4).

Presumably, one will be informed of the presence of thesenon-listed species and non-species resources by utilizing thePennsylvania Natural Diversity Index (PNDI) database andobtaining a PNDI receipt with a hit for such non-listed speciesand non-species resources. PNDI, however, does not use the term“critical communities,” but when certain non-listed species comeup in the PNDI database, a PNDI receipt indicates that “specialconcern” species may be impacted by the project. “Special con-cern” species, however, are not defined in any state or federalstatute or regulation, and no agency or entity that populates thePNDI database utilizes a consistent or public standard or processfor the categorization of such species. These decisions are madewithout public notice, input, rulemaking or peer review.

Thus the proposed list of “critical communities” to be newlyprotected through the creation of well permit conditions, pur-suant to a new process that would have agencies other than DEPcreate well permit obligations, cannot create certainty or pre-dictability for those who would obtain well permits inPennsylvania because the definition incorporates lists of speciesand non-species resources that can change without notice on adaily, weekly or monthly basis.

And while the term “critical communities” is not defined inAct 13 or elsewhere, its meaning should be considered in thecontext in which it was used—alongside of “rare and endan-gered” flora and fauna. “Rare” and “endangered” are terms thatdo have definitions and a process for categorization by thePennsylvania agencies tasked with the protection of species, suchas the Department of Conservation and Natural Resource, thePennsylvania Game Commission, and the Pennsylvania Fish andBoat Commission. But by protecting all non-listed species, andadding such categories as “tentatively undetermined” and “candi-date” to its proposed definition, DEP has departed far from theGeneral Assembly’s use of the word “critical” communities inAct 13. The use of the term “critical” communities indicates thatsuch communities are in dire need of protection, comparable tothe status of threatened or endangered species. Threatened andendangered species, however, are listed only after thoroughreview, public notice and rulemaking procedures, and generallyaccepted scientific review. DEP’s definition of “critical commu-nities” would elevate all non-listed species, as well as variousnon-species resources, to levels of protection comparable tothose for threatened or endangered species without any publicinput or science to justify such protection.

Further, having inserted a definition of “critical habitat” (bor-rowed from the PNDI Policy) in subpart (2) of its proposed defi-nition of “critical communities,” DEP would read Act 13 as cre-ating an obligation for DEP to consider the “habitats” of “criticalhabitats.” The context and language of Act 13 Section 3215

New DEP advisory group membersLast issue, we described how the Department of

Environmental was reformulating its Oil and Gas TechnicalAdvisory Board (TAB) to address matters related to unconven-tional operations and was creating a new Conventional Oil andGas Advisory Committee (COGAC). Since then, the membersof both groups have been made public and both groups met inlate March. The rosters are shown below.Oil and Gas Technical Advisory Board

Voting members:• Fred J. Baldassare, PG, owner & senior geoscientist,

ECHELON Applied Geoscience Consulting• David A. Yoxtheimer, PG, hydrogeologist, Marcellus

Center for Outreach and Research at Penn State University• Robert C. Hendricks, PG, water team lead/groundwater

protection lead Appalachia, Shell Exploration and ProductionCompany

• Casey V. Saunders, PE, Pennsylvania coal operationssenior project engineer, CONSOL Energy

• Bryan J. McConnell, PG, environmental program manag-er, Tenaska, Inc.

Non-voting members: • John Walliser, Esq., vice president of legal & government

affairs, Pennsylvania Environmental Council• W. Michael Griffin, PhD, executive director of the Center

for Energy and Decision Making, Carnegie Mellon University• Emily Krafjack, president, Connection for Oil, Gas &

Environment in the Northern Tier, Inc.• Barbara G. Kutchko, PhD, PE, physical scientist, National

Energy Technology Laboratory, U.S. Department of EnergyConventional Oil and Gas Advisory Committee

Voting members:• Mark L. Cline, Sr., production supervisory & on-site man-

ager, Cline Oil, Inc.• David Ochs, senior geologist/geology and operations

manager, Kriebel Resources Co., LLC• A. Bruce Grindle, president, Oil & Gas Management, Inc. • Dave Yingling, engineer, Rosebud Mining • Burt A. Waite, senior geologist, Moody and Associates Non-voting members: • Jim Morrison, Chief Administrator, Murrysville Borough• Doug D’Amore, Sproul district forester, Department of

Conservation and Natural Resources• R. Keith Hite, vice president of public relations, Blackford

Ventures; former executive director, Pennsylvania StateAssociation of Township Supervisors

• Sherry Tune, fAllegheny National Forest supervisor, U.S.Forest Service

The inclusion of non-voting members is something new forTAB, as is the shift in focus to just unconventional operations.Neither of these aspects is specified in the Oil & Gas Act of2012 (Act 13), which spells out the duties and makeup of TABand has remained unchanged since the Oil and Gas Act of1985. There are concerns that TAB’s bylaws go beyond whatis permitted under the law. Unlike TAB, the COGAC is strictly acreation of DEP and operates at the administration’s whim.

Both groups will play a key role as DEP continues to revisethe various parts of its Chapter 78 oil and gas regulations.

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(c)(4) simply do not support a definition of “critical communi-ties” that would include either critical habitats or non-speciesresources, such as those listed in subparts (2) and (3) of the newdefinition in the draft final rules.

Finally, Act 13 expressly requires EQB to develop criteria byregulation for DEP to use if it imposes permit conditions basedon impacts to any public resources, including habitats of criticalcommunities. Such criteria must ensure the “optimal develop-ment of oil and gas resources” and respect “property rights of oiland gas owners.” The draft final rules, however, do not create anycriteria for the DEP to utilize in conditioning well permits toprotect against harmful impacts to public resources, further com-pounding the uncertainties created by the proposed definition of“critical communities.”

Providing commentsDEP’s ANFR “particularly seeks comments on the definition

of ‘other critical communities’ (§§ 78.1 and 78a.1), noisemitigation (§ 78a.41) and centralized tank storage (§§ 78.57aand 78a.57a).” Please consider providing DEP with comments onthese sections, as well as the addition of schools, playgrounds,and well head protection areas as listed public resources to beconsidered for special protection during well permitting, anddozens of other subsections that have been significantly revisedsince the 2013 proposed rule.

Electronic comments may be submitted through theDepartment’s Online Regulatory Comment System atwww.ahs.dep.pa.gov/RegComments or by e-mail toRegComments@pa.gov. Written comments can also be sent tothe Department of Environmental Protection, Policy Office, 400Market Street, P.O. Box 2063, Harrisburg, PA 17105-2063.Comments must be received by May 19. A subject heading of therulemaking and a return name and address must be included ineach letter or transmission. More information is available onDEP’s website at www.portal.state.pa.us/portal/server.pt/commu-nity/public_resources/20303/surface_regulations/1587188. Thenew comment period being offered at this time for the reviewof two comprehensive and complicated regulations thatwould dramatically alter the obligations of the oil and gasindustry expires on May 19. ■

If you would like additional information about this importantdevelopment, please contact the author at 412-394-6468 orjmosites@babstcalland.com.

February 2014 Page 7April 2015 Page 7

Page 8 The PIOGA Press

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Wolf severance tax plan: It gets worse

When Governor Tom Wolf unveiled the actual legislationimplementing his severance tax plan last month, itcontained a feature not found in any other state’s

tax—a price floor that guarantees the state would receive pay-ments based on a value of gas of at least $2.97 per Mcf, no mat-ter how low actual prices fall. At the time the details of the taxwere made public, gas was selling at five Pennsylvania hubs forprices ranging from $1.23 to $2.52.

The severance tax legislation, called the PennsylvaniaEducation Reinvestment Act, sets the tax rate at 5 percent of theprice of gas plus 4.7 cents per Mcf. Wolf said his tax is modeledafter West Virginia’s production tax, but the floor is uniqueamong state severance taxes, according to the state’s IndependentFiscal Office.

“This is akin to someone that makes $40,000 having to paytaxes on $80,000 or $100,000 in income,” commented aspokesman for the Pennsylvania Chamber of Business andIndustry.

Wolf’s policy secretary, John Hanger, said the governor isaware of the current depressed gas market, but he indicated thepricing floor was added to ensure a predictable level of funding.

“The current market conditions are the equivalent of dis-tressed pricing,” Hanger said. “These are not sustainable priceswe’re seeing. They’re at the bottom of the market. There’s onlyone place for prices to go from where they are today and it’s up.”

The Wolf plan apparently also is unique in that it forces pro-ducers to absorb the entire cost of the tax and not pass any of the

expense onto the landowners from whom they lease mineralrights.

Make your voice heard!PIOGA members and other industry supporters are strongly

urged to speak out against the governor’s proposed severance tax.Visit www.pioga.org/say-no-to-a-severance-tax to find sampleletters you, your employees and others can send to your staterepresentative and senator opposing a tax. There’s also an easy-to-use automated version that looks up your lawmakers andsends an email. ■

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The U.S. Fish and Wildlife Service has designated thenorthern long-eared bat (NLEB) as a threatened species,but at the same time issued a special interim 4(d) rule that

the agency says provides flexibility to landowners, land man-agers, government agencies and others as they conduct activitiesin the bat’s habitat.

The USFWS says the future of the bat is threatened in 37states, including Pennsylvania, because of a deadly fungal dis-ease called white-nose syndrome that has devastated much of thecreature’s population. The listing was announced in the April 2Federal Register. The agency also considered a listing of endan-gered, which would mean the species is in jeopardy of becomingextinct.

The proposed interim rule under section 4(d) of the Endan -gered Species Act recognizes that activities in parts of the coun-try not affected by white nose syndrome that result in incidentaltakes of the bats are not imperiling the species. The final listingand the interim 4(d) rule go into effect May 4. The USFWS isaccepting comments on the interim rule through July 1.

According to the agency, for areas of the country impacted bywhite-nose syndrome, the measures provided in the interim 4(d)rule exempt take from the following activities:

—forest management practices; —maintenance and limited expansion of transportation and

utility rights-of-way;—prairie habitat management; and—limited tree removal projects, provided these activities pro-

tect known maternity roosts and hibernacula.Such activities, however, must:• Occur more than a quarter-mile from a known, occupied

hibernacula.• Avoid cutting or destroying known, occupied roost trees dur-

ing the pup season (June 1–July 31).• Avoid clearcuts (and similar harvest methods, e.g. seed tree,

shelterwood and coppice) within a quarter-mile of known, occu-pied roost trees during the pup season.

Independent Petroleum Association of America (IPAA) SeniorVice President of Government Relations and Political AffairsDan Naatz criticized the USFWS decision.

“From day one, the U.S. Fish and Wildlife Service acknowl-edged that the greatest threat to the northern long-eared batis…white nose syndrome, not habitat loss due to human activity.This is the agency’s most restrictive designation to date—poten-tially affecting a myriad of U.S. industries, including oil and gas

producers, wind energy developers, agriculture, and other con-struction projects planned in regions where the bat habitatexists,” said Naatz.

“Rather than listing the bat and limiting development, the Fishand Wildlife Service should work toward finding a solution tothis deadly disease, while ensuring energy development, environ-mental stewardship, species conservation and economic growthcan thrive together across the nation,” he continued.

The IPAA noted that oil and gas activities have approximately150 times less impact on bat habitat than the forest managementactivities that the agency has already exempted.

In formal comments filed March 17, PIOGA agreed with theIPAA and other industry organizations that the threat to the bat iswhite nose syndrome, not habitat loss through human activity.PIOGA urged the USFWS to include oil and gas operations inany exemptions created in the final 4(d) rule and to expand theexemption for rights of way and transmission corridors.

More information on the regulatory action is available atwww.fws.gov/midwest/endangered/mammals/nlba. ■

DEP seeks pipeline strategy

John Quigley, acting secretary for the Department ofEnvironmental Protection, is looking to develop a strategyfor building the network of pipelines necessary to get

Pennsylvania’s burgeoning natural gas supplies to market. At abudget hearing before the Senate Appropriations Committee,Quigley noted that at least 12 major pipeline projects are underway within the Commonwealth, and he indicated the departmentwould convene a task force to try to reduce the impact ofpipelines on the environment and communities.

“We’re not under any illusion to reduce impact to zero,”Quigley told StateImpact. “There’s going to be impact but arethere opportunities to plan smarter? Share rights of way forexample? Can companies work together to optimize develop-ment? I don’t know the answers to those questions but I thinkthey’re worth asking.”

Quigley says he wants to bring together pipeline companiesand local authorities to voluntarily start a conversation outside ofthe regulatory environment. He indicated that the companies sofar have responded enthusiastically. While there is a huge need tobring Pennsylvania shale gas to additional markets, opposition topipeline construction has reached a fever pitch in some parts ofthe state.

“We’re not contemplating any additional regulatory action orregulatory grab,” said Quigley. “This is about having a conversa-tion to see if we can facilitate this whole development process ina way that makes sense for everybody.”

The task force is expected to include representatives fromindustry, local governments and environmental groups to developguidelines for siting gathering lines and transmission lines.Pennsylvania lacks authority to regulate pipeline siting, so theinitiative will be strictly voluntary.

The newly appointed deputy secretary for programs, DeniseBrinley, reportedly will lead the project. ■

USFWS lists northern long-eared bat as threatened

February 2014 Page 11April 2015 Page 11

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Oil & Gas AwardsCelebrating the best in the Northeast

On the evening of March 25, a ballroom at the WestinConvention Center Pittsburgh filled with more than 600of the industry’s most prominent people in our region,

present to honor the outstanding achievements within theupstream and midstream segments over the past year.

This year’s Northeast Oil & Gas Awards gala was special forPIOGA. Not only did our members earn the lion’s share of theawards given out, but our own Lou D’Amico was the guest ofhonor, serving as keynote speaker. We think Lou’s messagedeserves to be heard beyond just those who attended the Oil &Gas Awards, so we are sharing his keynote address here.

Also, we couldn’t be more pleased that Jim Kriebel wasselected to receive the Industry Leader award. In addition toserving as treasurer on the PIOGA Board of Directors, Jim ispresident and CEO of the Kriebel Companies in Clarion. He andthe Kriebel family have been involved in natural gas drilling anddevelopment in Western Pennsylvania for 43 years. Together,they have drilled, completed and operate more than 1,700 wells.In addition to being active in industry organizations includingPIOGA, the Society of Petroleum Engineers and the IndependentPetroleum Association of America, Jim in a leader in his commu-nity, serving on the boards of many local organizations and hischurch. We congratulate him on receiving this honor.

We also applaud the following PIOGA members who werehonored with awards:

• Engineering Company of the Year — ARM Group Inc.• Water Management Company of the Year — Keystone

Clearwater Solutions• Consultancy of the Year —

Civil & EnvironmentalConsultants, Inc.

• Manufacturer of the Year —Worthington Industries

• Award for Excellence inWell Completion — PackersPlus Energy Services, Inc.

• VZ Environmental Awardfor Excellence in EnvironmentalStewardship — RangeResources

• The Oil & Gas FinancialJournal Transaction of the Year— Southwestern EnergyCompany

• Breitling Energy FutureIndustry Leader — Lauren R.Parker, Civil & EnvironmentalConsultants, Inc.

• Award for Excellence inHealth & Safety – Products —TekSolv

• Oilfield Services Company of the Year — McCutcheonEnterprises, Inc.

• JC Fodale Award for Excellence in Corporate SocialResponsibility — Dominion Resources

• Eclipse Resources Award for Drilling Excellence — Baker

Hughes• Law Firm of the Year — Steptoe & Johnson, PLLC• General Industry Service Award — IPC Energy Services,

LLCThe full list of nominees and award recipients can be found at

www.oilandgasawards.com/northeast-2015. ■

Above: Jim Kriebel accepts his award. Below: All smiles at thePIOGA table.

February 2014 Page 13April 2015 Page 13

Good evening, ladies and gentlemen. I ampleased and very honored that the Oil and GasAwards has chosen me to be this year’s guest

speaker. I suspect that being older than dirt and part ofthis industry for over 40 years gives me quite a uniqueviewpoint of oil and gas in Pennsylvania.

I received that following suggestions for my speechtonight: 1) Be brief—that should be fairly easy! 2) Givean overview of the industry in Pennsylvania today—again fairly easy! 3) Tie in your speech to the purposeof the Oil and Gas Awards. Given that these awards areabout innovation, that should be pretty easy too.Innovation is exactly what has driven shale developmentand driven the U.S. to the top of global energy produc-ers. 4) And, finally, be enthusiastic and positive—giventhe challenges of energy prices, constant attacks by theenvironmental community, and the overreach of state,

local and federal governments, I may have a tougher mission. If I had another five minutes, I guess I could tackle government partisan-ship and Middle East peace.

Make no mistake, the people in this room and throughout the oil and gas industry nationwide have accomplished something that isnothing short of a miracle in the last decade. We have increased domestic oil production by 4.5 MMbbl of oil per day, more than theentire production of any single nation on earth, save Saudi Arabia.

We have discovered right below our feet the second largest natural gas field in the world. We have gone from a nation looking forsuppliers of natural gas in the form of LNG to one looking to export natural gas beyond our borders.

We have cut greenhouse gas emissions by over 20 percent, exceeding the Kyoto protocol, which we as a nation did not sign, butare the only nation that has made those improvements. Guess what? The U.S. government didn’t do it—you did. A vocal and aggres-sive environmental lobby didn’t do it—you did.

We have revived the chemical business in the U.S., we have reinvigorated manufacturing in the U.S., and we’ve lowered the cost ofenergy for every business, homeowner and driver in the U.S.

We have managed all this not only without the help of government, but bluntly in spite of government. The overall U.S. energy policythat people have been calling for since the first oil embargo of the Seventies is still nonexistent.

Instead, our governments—state, local and federal—have thrown every possible roadblock a bureaucrat can dream up in our paths.Yet the work you do has made life for every American better and less costly and we continue to do so.

Right now, times are tough for this industry. We have become victims of our own success. OPEC has been so threatened by theU.S. success in shale oil development that the Saudis have driven prices down to further impact the development of our oil resources.Oversupply and infrastructure constraints have hammered the price for natural gas, particularly in Pennsylvania. Budgets have beencut, profits have declined and jobs have been lost in our industry.

On top of these challenges, we have a new governor in Pennsylvania who believes that government should be bigger, spend moreand fund all this bigger government on the backs of our industry. In his view, he believes this is in OUR best interest. Governor Wolfcan state with a totally straight face that Pennsylvania is 45th in education spending, when the National Education Association reportsthat Pennsylvania is at seventh to 11th, depending on the year. He has recently claimed that the tax burden he proposes as a sever-ance tax is the lowest in the region, when at current gas prices and with the $2.97 price floor his tax is based on would make us thehighest in the U.S.

So how do we meet these challenges? We have been through some of this before. I began my career as a petroleum engineer at alow point for our industry, lived through and prospered in a boom, followed by another bust. Then the shale revolution began and manyof us tended to forget the lessons of the past.

It has been said in our industry each time price is in the cellar that the cure for low prices is low prices. Decreased activity, lowerinvestment in drilling and continued infrastructure build-out will eventually bring price and profits back in line—but when? I rememberthe mantra of the industry was, “Stay alive ‘til ’85!” The timeline turned out to be far longer!

Price has two components, supply and demand. If we are to survive and strive forward, we must think differently. We can’t wait forthe prices to recover by shrinking supply. You all recognize in this room that if drilling stopped tomorrow—completely—we still haveclose to 2,000 wells, already drilled, waiting to come on line. There is no doubt that a similar situation exists elsewhere in the country.

The solution is increased demand—increased natural gas usage in electric generation, increased usage in transportation, anincrease in residential use and an increase in industrial demand. I am proud to say that PIOGA is the only state association in the U.S.with a full-time employee dedicated on increasing demand through all of those potential markets.

We also have to be more aggressive and innovative in combating the misinformation and outright lies from the environmental com-munity at every turn.

We must be more innovative in our dealings with government entities—educating individuals and institutions on the impacts theiractions are having, not only on us, but the customers we serve.

Finally, we must be innovative with our work—cutting costs, increasing efficiencies and focusing on keeping our industry in the spot-light of positive impacts, while minimizing the negatives.

This is the innovation we need. That, ladies and gentlemen, is why we are here tonight, to celebrate and honor professionalism andinnovation in our industry. Remember that you don’t have to be a winner of an award this evening, but rather be among those whobring your best to this industry.

Thank you.

Lou D’Amico’skeynotespeechat theOil and GasAwards

Page 14 The PIOGA Press

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Gas Well Permitting for Conventional and

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Development of High Capacity Groundwater Supply Wells

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Assistance with Water Sourcing

Water Management Plan Preparation

SPCC/Control & Disposal Plans

Disposal Well Permitting

Erosion & Sedimentation Control Planning

Fresh Water Determination Studies

Soil and Groundwater Remediation

Stray Gas Migration Investigations

Hydrogeologic Studies

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Wetland Delineation and Aquatic Surveys

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February 2014 Page 15April 2015 Page 15

Zoning ordinance validitychallenges persist in thewake of the RobinsonTownship plurality opinion

In a somewhat ironic twist, anti-industry residents and envi-ronmental groups have been relying on their victory inRobinson Township v. Commonwealth, 83 A.3d 901 (2013),

which invalidated the statewide standardized land use control setforth in Act 13 and restored local land use control over oil andgas operations, to challenge local zoning ordinances that regulateoil and gas development. The challengers in these validityactions generally argue that, per the plurality’s expansion of thePennsylvania Constitution’s Environmental Rights Amendment(ERA) in Robinson Township1, each municipality must engage insubstantial environmental and safety analysis prior to enactingoil and gas regulations or issuing permits thereunder. Accordingto the challengers, an ordinance enactment process or permitreview process that does not satisfy these requirements is invalid.

Capitalizing on the Robinson plurality’s opinion that the ERAimposes on municipalities a duty to protect public naturalresources, residents and environmental groups have challengedlocal zoning ordinances in five municipalities. One commonargument is that the local governing body did not engage in suf-ficient environmental due diligence prior to enacting oil and gasland use regulations to satisfy its duty under the ERA andRobinson. According to some challengers, the ERA andRobinson require that a municipality conduct various types ofenvironmental analysis, such as hydrogeological testing and airmodeling, to inform the ordinance drafting process. However,given the ambiguity in the Robinson plurality opinion, there isnot consistency among the challenging parties as to the scope ofpre-enactment due diligence necessary to satisfy the ERA.

The challengers also frequently argue that the challenged reg-ulations are inadequate to protect natural resources and the envi-ronment, and that the ERA and Robinson require municipalitiesto engage in their own environmental analysis on an application-by-application basis to ensure adequate environmental protec-tion. The challengers making this argument generally view thelocal regulations in a vacuum, disregarding extensive state andfederal regulatory, permitting and enforcement regimes. Severalchallengers also take the position that oil and gas development isnecessarily incompatible with residential and agricultural usesand, based on this premise, conclude that allowing the disparateuses to coexist within a single zoning district is tantamount toillegal spot zoning. Depending on the contents of the challengedordinance, some challengers also argue that any incorporation ofor similarity to the stricken provisions of Act 13 (e.g., minimumsetback requirements) are necessarily invalid.

It is noteworthy that all of the challengers appear to be main-taining their respective positions despite the CommonwealthCourt’s clear statement in its en banc opinion in PennsylvaniaEnvironmental Defense Foundation v. Commonwealth, 108 A.3d140, fn. 37 (2015) that the Robinson decision is not bindingprecedent, but merely persuasive authority “to the extent it isconsistent with binding precedent from [the Commonwealth]Court and the Supreme Court on the same subject.”

The following is a brief update on thefive post-Robinson zoning ordinance validi-ty challenges:

■ New Sewickley Township, BeaverCounty. In September 2014, following NewSewickley Township’s approval of a condi-tional use application for a compressor sta-tion next to their property, organic farmersDonald and Rebecca Kretschmann andKretschmann Farm LLC challenged thevalidity of the township’s zoning ordinance.Penn Energy Resources, LLC, Cardinal PAMidstream, LLC and a group of farmersintervened in the action. During the firstnight of the zoning hearing board hearing,held in October 2014, the challengers pre-sented several witnesses, including calling,on cross-examination the chairman of theboard of supervisors and a member of theplanning commission, who testified aboutthe process the township followed whendrafting its oil and gas regulations.Challenger Donald Kretschmannalso testified. The challengerswithdrew their case the followingday before the intervenors present-ed their cases, under objection from the intervenors. This matteris no longer pending.

■ Robinson Township, Washington County. In September2014, six residents filed a facial validity challenge (as opposed toa challenge to the ordinance as applied to a specific request) toRobinson Township’s newly-enacted zoning ordinance. The chal-lenged ordinance is less industry-antagonistic than the previousordinance, as two of the three members of the board of supervi-sors that brought the original Robinson Act 13 challenge werevoted out of office in 2013. The zoning hearing board hearing onthe validity challenge opened in October 2014, and RangeResources-Appalachia, LLC, MarkWest Liberty Midstream andResources, LLC and Robinson PROUD participated in the pro-ceedings. The township and Range Resources moved for dis-missal of the challenge as unripe and because the challengerslacked standing. The challengers then filed a second, as-appliedvalidity challenge, adding to its previous claims a challenge tothe township’s approval of a Range Resources well pad under thechallenged ordinance. The hearing resumed in January 2015 andthe parties presented argument on the standing and ripenessissues. The zoning hearing board then voted to deny and dismissboth the facial and as-applied challenges. The challengersappealed both cases to the Washington County Court ofCommon Pleas in February 2015 and the matters are currentlypending there.

■ Middlesex Township, Butler County. Four residents, theClean Air Council of Philadelphia and the Delaware RiverkeeperNetwork challenged Middlesex Township’s zoning ordinance andissuance of a well permit to R.E. Gas Development (Rex Energy)in October 2014. MarkWest Energy Partners, LP intervened inthe matter in opposition to the appeal. The zoning hearing boardheld the hearing over nine evenings of testimony, beginning inNovember 2014. The challengers presented 10 witnesses, includ-

Krista-AnnStaley, Esq.

Blaine A. Lucas,Esq.

Authors:

Page 16 The PIOGA Press

ing a planning professor, a geologist and several residents, andrested their case in February 2015. The township and RexEnergy presented six witnesses, including the township’s formermanager, a public health and environmental health scientist, aland use attorney, and several residents, and rested their case inMarch 2015. All parties have presented their closing argumentsand the record is closed. The zoning hearing board is scheduledto vote on the challenge on April 29.

■ Allegheny Township, Westmoreland County. In Novem -ber 2014, three residents challenged Allegheny Town ship’s zon-ing ordinance, as amended in 2010 to address oil and gas devel-opment, and the township’s issuance of a gas well pad approvalto CNX Gas Company LLC. CNX, the surface owner and agroup of lessors intervened in the case in opposition to the chal-lenge. The zoning hearing board held the hearing over threeevenings in January and February 2015, during which the chal-lengers presented witnesses including a biology professor, alandscape architect and several of the objecting residents. CNX’switnesses included an expert on the relationship between the oiland gas industry and agricultural activities, its general managerof gas permitting, and a senior land agent. The zoning hearingboard also heard public comment from residents. The zoninghearing board voted to deny the challenge on March 5 and issuedits findings of fact and conclusions of law in support of its deci-sion on March 18. As of the date of this writing, an appeal hasnot been filed.

■ Pulaski Township, Lawrence County. Four residents chal-lenged Pulaski Township’s zoning ordinance in December 2014.Hilcorp Energy Company intervened in opposition to the chal-lenge and the zoning hearing board hearings began in February

2015. The challengers presented a landscape architect and two ofthe objecting residents as witnesses and rested their case inMarch 2015. Hilcorp presented an expert on the relationshipbetween the oil and gas industry and agricultural activities, itsleasing and project management consultant, and a company engi-neer who manages local and state permitting. The hearing closedin March 2015. The zoning hearing board is expected to meetand render its decision before the end of April 2015.

No additional Robinson-based validity challenges have beenfiled since this initial rush of cases. It is possible that potentialchallengers and their legal counsel are waiting to see how localzoning hearing boards and the courts resolve the ERA andRobinson arguments before pursuing action on additional fronts.In the meantime, municipalities must continue to navigate regu-latory territory where they may be sued based on arguments thattheir regulations are not strict enough, while also attempting toavoid challenges from the industry that their regulations are pre-empted by state and federal law. It is likely that at least one ofthese challenges will be find its way up to the PennsylvaniaCommonwealth Court, which may provide some much-neededclarity to both municipalities and operators in the area of localregulation of oil and gas development. ■

If you would like additional information about local zoning ordi-nances that regulate oil and gas developments, please contactKrista-Ann Staley (412-394-5406, kstaley@babstcalland.com) orBlaine A. Lucas (412-394-5657, blucas@babstcalland.com).

1 The three-justice plurality opinion, authored by Chief Justice Ronald D.Castille, greatly expanded the court’s previous interpretation and application ofthe Environmental Rights Amendment (ERA), finding that it imposes on theCommonwealth and its municipalities a fiduciary duty to “conserve and main-tain” natural resources. According to the plurality, this “implicates a duty to pre-vent and remedy the degradation, diminution, or depletion of our public naturalresources.” The plurality found that this duty is two-fold, comprised of “a duty torefrain from permitting or encouraging the degradation, diminution, or depletionof public natural resources” and a duty “to act affirmatively to protect the envi-ronment, via legislative action.” As a result, the plurality found that certain provi-sions of Act 13, including those limiting local regulation of oil and gas develop-ment, failed to satisfy these duties.

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Doctor loses lawsuit challengingsecrecy of fracking fluid

Afederal appellate court has upheld the dismissal of a law-suit filed by a physician challenging a law that precludedhim from releasing information he obtained regarding

chemicals contained in hydraulic fracking fluid.Dr. Alfonso Rodriguez of Dallas challenged Act 13 of 2012,

which allows medical professionals to learn the ingredients infracking fluid if the information is used to treat patients, butrequires them to enter a confidentiality agreement.

Dr. Rodriquez, a kidney specialist who has questioned thehealth impact of the fracking process, filed a federal lawsuit in2012 that alleged the “medical gag rule” interfered with his abili-ty to treat patients, some of whom worked in the natural gasindustry and had been exposed to fracking chemicals.

The lawsuit argued Dr. Rodriguez had an ethical obligation toshare information regarding fracking fluid ingredients with hispatients, other medical professionals and the general public “toadvance scientific knowledge.” The suit, which named the headof the Department of Environmental Protection and state attorneygeneral as defendants, sought a court order precluding the agen-cies from enforcing the law.

Senior U.S. District Judge A. Richard Caputo dismissed thecomplaint in June. In mid-March, the Third Circuit Court ofAppeals affirmed the judge’s ruling.

The appellate court said it concurred with Judge Caputo’sdetermination that Dr. Rodriguez lacked legal standing to bringthe lawsuit. The court noted federal law requires a plaintiff showhe or she suffered an actual injury. In this case, Dr. Rodriguezclaimed his injury was the threat of a lawsuit or professional dis-cipline if he failed to adequately treat a patient because of hislack of knowledge of the chemicals to which the patient mayhave been exposed. The court agreed with Judge Caputo thatpurported injury was too speculative to meet the legal standard.

—This article appeared in the Scranton Times-Tribune

Page 18 The PIOGA Press

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

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Research, industryand academia By Joyce TurkalyDirector, Natural Gas Market Development

The Pittsburgh Regional Energy Alliance hosted a morningconference March 10 with guest speakers Dr. Grace M.Bochenek, the new director of the National Energy

Technology Laboratory (NETL), and Dr. Paul Fischbeck ofCarnegie Mellon University.

Speaking to the laboratory’s mission to protect the nation’senvironment and enhance energy independence, Dr. Bochenekstated, “Fossil energy will continue to be here in a very promi-nent way.” Prior to NETL, she worked for the Department ofDefense, where she held various management and technical posi-tions.

Dr. Bochenek encouraged companies to come work withNETL. “This is your lab,” she told the audience. Along withNETL’s natural gas and oil research ensuring smart and safeexploration and development, she highlighted two areas of cur-rent research devoted to rare earth elements as byproducts ofcoal and methane hydrates as a future energy source.

2014 was a breakout year for startup companies, many whichreceived mention by Rich Lunak, president of Innovation Works.Innovation Works links entrepreneurs with investment capital andassists with energy technology development and commercializa-tion. Due to the integration capabilities of both of the labs, alongwith work done at local universities, there were many successes

in technology transfer within the energy segment (see www.inno-vationworks.org/Our-Companies/Energy).

Concluding the morning program was Dr. Fischbeck, profes-sor of social and decision sciences and engineering and publicpolicy at Carnegie Mellon. Dr. Fischbeck and his team haveexpanded on computer modeling software that the university firstdeveloped in the 1980s. The software has been upgraded toinclude analysis based on new processes for CO2 capture andstorage and new more efficient systems for electric generation.The software also simulates various cost-based scenarios thatevaluate tradeoffs, risks and opportunities on a state-by-statebasis. Using the Clean Air Act’s section 111(d) four “buildingblocks” as currently proposed (see accompanying article), themodel shows how different choices (whether co-firing with natu-ral gas, for example) would not only affect the cost of power foreach state, but how frequently individual generators would beneeded to run and which generators will never meet the require-ments, referred to as “old dogs” by Dr. Fischbeck.

The resulting data is a cost-to-value proposition and will be ahelpful tool as states try to determine how to meet the federalguidelines. It will also be helpful for PIOGA producers andstakeholders to understand the methodology used in not only thissoftware, but also the methodology used in the state planning

Above: Dr. Paul Fishbeck, Carnegie Mellon University. Below:Dr. Grace M. Bochenek, National Energy Technology Lab.

February 2014 Page 23April 2015 Page 23

Proposed standards encourage natural gas

The Environmental Protection Agency’s (EPA) proposal toset annual state standards for regulating CO2 emissionsfrom existing power plants under Clean Air Section

111(d) will be issued as a final rule this July. The “Clean PowerPlan,” as it’s referred to, reflects a first-ti me attempt to changehow electricity is generated, transmitted and consumed in theUnited States. Since last spring, the Federal Energy RegulatoryCommission’s technical conferences on gas and electric coordi-nation have focused on the regional (interstate transmission) ofthe electric grid; whereas now adding the additional EPA metricit is up to each state to not only interpret but also manage com-pliance (see www2.epa.gov/carbon-pollution-standards/fact-sheet-clean-power-plan-carbon-pollution-standards-key-dates).

Under the Clean Power Plan, each state has interim goals forthe 2020-2029 periods, and then by 2030 there is a final goal.The mandatory goals contained within the proposal are based onfour building blocks. The first is making heat rate improvementsat coal-fired plants, assuming that results for each state can aver-age a 6-percent reduction in CO2 emissions; the second suggests

that natural gas plants are not running at their full capacity; thethird building block encourages expanding renewable generation;and, finally, the fourth speaks to demand-side management.

Overall the thought process is to use the building blocks tocalculate the new state standards. It is going to be up to eachstate to put forth a compliance proposal by summer 2016. Giventhe current price forecast for natural gas, the second buildingblock would appear to favor natural gas producers. Given certainassumptions in the current proposal, natural gas production hasthe potential to increase by an additional 18 percent by 2030.

Carnegie Mellon University’s Department of Engineering andPublic Policy set forth to develop upon software that was intend-ed for engineers, policy makers and researchers in a variety ofpollutant-control technologies. CMU is demonstrating the soft-ware as a useful tool that can now also serve to assist each statewith formulating a compliance plan. The IntegratedEnvironmental Control Model (IECM) sets out to calculate theperformance emissions and cost of a fossil fueled power plantwhen comparing multiple technologies and systems.

PIOGA recognized the importance of natural gas’s role as afuel for electric generation more than three years ago. Aroundthe same time, the association’s Gas-Electric CoordinationSubcommittee was formed to focus on identifying and articulat-ing short- and long-term issues related to natural gas and electriccoordination throughout Pennsylvania and surrounding states.

EPA has posted on its website a “Clean Power Plan StateGoal Visualizer,” which attempts to show how each state’s goalswere calculated by the agency (www2.epa.gov/cleanpowerplan-toolbox).

—Joyce Turkaly

process. When taking into account the various inputs, the currentcost of natural gas along with combined cycle natural gas gener-ation technology stands to be a winner.

There was a meeting to discuss the software in greater detailon March 24 at the Pittsburgh Regional Alliance. ■

Page 24 The PIOGA Press

Is your regulatoryhouse in order?By Daniel A. GarciaLeech Tishman Fuscaldo & Lampl

Spring represents a time for reevaluation, reflection andimprovement. For many pipeline operators, this is a greattime to reevaluate and improve on safety and regulatory

programs to ensure compliance with state and federal pipelinesafety requirements. Recent accidents involving gas pipelines,rail cars and barges have forced state and federal regulatoryagencies to focus their attention to the transportation of naturalgas and other hazardous materials.

In Pennsylvania, the Department of Environmental Protectionand the Pennsylvania Utility Commission are already taking on amore antagonistic tone toward the oil and gas industry. With allo-cated budget increases for enforcement efforts, the DEP andPUC will want to publicly demonstrate their “successes”—mean-ing, they will be looking for test cases and pipeline operators toshowcase heightened enforcement. With the 2011 passing ofH.R. 2845, doubling the maximum civil fines for safety viola-tions, an increase in the enforcement capabilities of state regula-tors, and the downward economic pressures in the oil and gasmarkets, your company cannot afford any type of violation.

PHMSA and H.R. 2845, the “Pipeline Safety, RegulatoryCertainty, and Job Creation Act of 2011”

The Pipeline Safety, Regulatory Certainty and Job Creation

Act created an immediate impact on pipeline safety and compli-ance recordkeeping for pipeline operators around the country.This legislation increased the pressure on many pipeline opera-tors to ensure pipeline records were accessible, verifiable andcomplete. Furthermore, these new regulations doubled the maxi-mum civil fine for all safety violations; required of all operatorsto confirm, by testing or records, the maximum allowable operat-ing pressure (MAOP) of certain pipelines located in HighConsequence Areas (HCAs); empowered the federal Pipeline andHazardous Materials Safety Administration (PHMSA) to set timelimits for accident and incident notification; required PHMSA toissue regulations requiring automatic shutoff valves on new orreplaced pipelines; and removed exemptions for pipelinesinstalled before 1970, cast iron pipeline and other older pipelinerecords. Most significantly, this legislation now requires all olderpipelines to maintain records on the MAOP on older bare steeland cast iron pipelines.

Since 2013, PHMSA initiated 428 enforcement cases againstpipeline operators for problems involving their integrity manage-ment programs, risk assessments, failure prevention and mitiga-tion programs, and several other possible regulatory violationsidentified during failure investigations and routine inspections(PHMSA, 2015). Many of these violations face fines rangingfrom $10,000 per day up to $2 million for a related series of vio-lations.

Are you prepared for a regulatory audit or inspection?With a budget increases in state and federal regulatory agen-

cies, the question is not a matter of “if” your pipeline will beinspected but “when.” According to Laurel Brandstetter, a former

April 2015 Page 25

federal prosecutor and chair of the internal investigations groupat the Pittsburgh law firm Leech Tishman Fuscaldo & Lampl,“Records that meet the bare minimum requirements of the actwill likely receive additional scrutiny. Pipeline operators shouldbe prepared to demonstrate their commitment to safety and com-pliance. This not only extends to the records maintained by theoperators, but also to its internal policies and culture of compli-ance. Operators who foster a culture of cover-up or minimumcompliance with pipeline safety will attract heightened scrutiny,review and run the risk of birthing true whistleblowers.”

It is critical that your organization develop the ability to ade-quately communicate to the auditor that your management ofpipeline integrity meets and exceeds the state and federal mini-mum standards and that your records are accessible, verifiableand complete. Doing so could potentially save your company asignificant amount of time, money and heartache. For example,MAOP compliance verification could cost around $1,500 permile, if records are accessible, verifiable and complete. Shouldthese records be inadequate, those costs can jump to $8,000-$10,000 per mile to “pig” the line or hydrostatically pressure testthe pipe. In a worst case scenario, the cost can jump to $200,000per segment where pipeline integrity tests have failed andpipeline segments must be excavated and replaced.

Next stepsYou should identify your risks by asking the following: Are

you confident that when problems arise, your company is ade-quately prepared to successfully respond? Do you have a regula-tory compliance program? What systems or programs are inplace to respond pipeline safety or environmental violations?

How public is your company? Would misconduct or an investiga-tion attract media attention?

While these questions provide a brief snapshot of your organi-zation’s compliance readiness programs, identifying these riskscan help develop a mitigation plan and, ultimately, a strategy fordeveloping a strong reporting program. While there is never anyguarantee of a risk-free existence, you have an opportunity rightnow to become better prepared to meet challenges from state andfederal regulators. ■

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Safety Committee CornerSafety Committee CornerHow to select yourrescue te am By Paul N. Pantages, CSP Manager – Safety Services AM Health and Safety Inc.

Confined Space entries occur around the clock every day.As part of the requirements for safe entry is the need forrescue capabilities for entrants, it is up to the host

employer to evaluate the benefits of training on-site employeesor relying on an outside rescue service. That evaluation processcan make the difference in outcome of a confined space emer-gency event.

As stated in the General Industry Standards, 29 CFR1910.146 Permit Required Confined Space, OSHA has set forththe requirements that must be met for an employer to performconfined space entries. One specific area of the standard is sel-dom emphasized; that is the section that requires employers tohave confined space rescue procedures. Unless the employer hasa trained and equipped rescue team on-site, does this section getthe proper attention. The choice of using on-site versus outsideemergency responders must be weighed carefully. Many employ-er sites rely on calling 911 to summon emergency responders aspart of their program. Employers seldom evaluate the emergencyresponders that are expected to come into their facility and per-form critical rescue functions. A sad outcome involved theresponse to a confined space rescue that occurred on May 7,2010, in Ohio, when emergency responders were summoned to aman down in a sewer. The responders were not utilizing anybreathing air apparatus and were unaware of the hazards associ-ated with this location. The sewer was located next to a manufac-turer of compressed gasses. The atmosphere contained less than2 percent oxygen and affected personnel outside of the confinedspace as well as the rescuers that entered into the confined spacewithout any breathing air apparatus.

Examples like the previously mentioned emergency responsehighlight the need to apply appropriate evaluation mechanisms to

minimize poten-tial negative out-comes. By read-ing the OSHAStandard 29 CFR1910.146, wehave learnedabout the generalrequirements thatare to be fol-lowed. The sec-tion that isfocused on in thisarticle addressesthe requirementsfor summoningrescue and emer-gency services.

The specificwording from theOSHA general

industry standard is stated as follows: 1910.146(d)(9)

Develop and implement procedures for summoning rescueand emergency services, for rescuing entrants from permitspaces, for providing necessary emergency services to res-cued employees, and for preventing unauthorized person-nel from attempting a rescue.

As described in 29 CFR 1910.146(d)(9), the site employer isrequired to develop a procedure for the proper handling confinedspace emergencies. Part of the evaluation is whether the respon-ders have the “technical competency” and “equipment” to per-form in a confined space rescue event. Confined space rescue isa technical competency that requires continued training and spe-cialty equipment that may not be available at your local neigh-borhood emergency responders. Another requirement is theremust be backup responders prepared to enter (two-in/two-outrule). Sufficient number of support personnel are required as partof a response.

As part of the abovementioned OSHA standard, specifically,29 CFR 1910.146(k)(1)(i) states “respond to a rescue summonsin a timely manner.” This again requires site management toevaluate the ability of responders on their abilities and equipmentto provide the type of rescue services that may be required for aconfined space emergency prior to an event and practice aresponse. Additionally, the emergency responders need to havefamiliarization with the facility to minimize response to the prop-er location. The responders need to be aware of the hazards asso-ciated with the confined spaces and the methods that are typical-ly put into place to create a safe working environment as part ofthe OSHA standard. Examples of this are energy control proce-dures (ECP), ventilation, line blanking, inerting/purging andcleaning procedures.

The use of outside emergency responders requires that thehost employer evaluate the capabilities similar to the manner inwhich they currently evaluate outside contractors. This is usuallyperformed by another outside contractor. The evaluation criteriaare significantly different than of typical outside contractors. Themeasurement tools such as employee modification rates (EMR)and a review of program elements are not fully applicable toemergency response providers. The evaluation process requiresthe employer to review capabilities and equipment. The Non-mandatory Appendix F of the OSHA standard provides details tobe applied to the selection of a rescue provider. This appendix

Examples of special-ized confined spacerescue equipmentrequired: supplied airrespirators with air-line, communicationsystem with throatmicrophones , rescueharness and atmos-phere monitoringmeters.

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describes observation and demonstration as part of the selectionprocess. Additional criteria to be evaluated are the availabilityand ability to apply the specialty rescue equipment required for aconfined space rescue. These items such as supplied air respira-tors, communications, atmospheric monitoring, technical rescue(retrieval) equipment and other special equipment need to bemaintained in a state of readiness. Another measurement tool tobe applied is the documentation of training and accreditation. Aspart of the National Pro Board Certification program, a profes-sional certification in Confined Space Rescue is offered. Thecompetencies required for both confined Space RescueTechnician Level I & II are based upon the National FireProtection Association (NFPA) 1006 Standard for TechnicalProfessional Rescuer. Obtaining these certification levels requiresuccessful completion of a written examination and a practicalevaluation utilizing the specialty rescue equipment previously

identified. As part of this practical evaluation, the evaluators areable to measure the performance of the candidates utilizing astandardized set of job performance requirements (JPR).

The specific sections of NFPA 1006 that are applicable are asfollows: Chapter 4 Technical Rescuer

4.1 General Requirements 4.2 Entrance Requirements 4.3 Minimum Requirements

Chapter 5 Job Performance Requirements 5.1 General Requirements 5.2 Site Operations 5.3 Victim Management 5.4 Maintenance 5.5 Ropes/Rigging

Chapter 6 Rope Rescue 6.1 Level I General Requirements 6.2 Level II General Requirements

Chapter 7 Confined Space Rescue 7.1 Level I General Requirements 7.2 Level II General Requirements

Each section in the NFPA standard identifies critical skill setsand measurement mechanisms to assist companies evaluate thoseemergency providers that can comply with the requirements setforth in NFPA 1006.

When applying the requirements of NFPA 1006, an employermust evaluate the capabilities of the responding provider. As pre-viously stated, professional certifications are the preferred meas-urement tool. The employer should also evaluate the equipmentthat may be required to perform on their site. This includes verti-

Patient handling capabilities area required competency. Thesetypes of competencies arerequired to be performed in con-fined spaces with restrictivemovements and may involveapplication of restrictive patientstabilization devices.

Page 28 The PIOGA Press

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cal as well as horizontal entrances into confined spaces. Eachscenario has limitations and risks. The key to success is to mini-mize the risks and provide annual training opportunities for theselected responding provider to test their capabilities and equip-ment.

Much of this specialty equipment is not carried by every res-cue provider. Unfortunately, this type of equipment is expensiveand not used every day. Monthly inspection of this specialtyequipment is required. A sample of specialty equipment requiredto perform confined space rescue is as follows:

• Energy control equipment—LOTO specific • Personal protective equipment (PPE) • Respiratory protection equipment—supplied air respirators

(SAR) • Airline hose—maximum of 300 foot of hose per rescuer is

required • Rescue rated ropes (NFPA 1983 Standard on Life Safety

Rope and Equipment for Emergency Services • Rescue harnesses • Rescue tripod • Patient packaging equipment/first aid equipment • Atmosphere monitoring equipment (oxygen, combustible

gas, carbon monoxide and hydrogen sulfide) • Specialty communications equipment that may be used in

explosive atmospheres • Specialty lighting equipment that may be used in explosive

atmospheres In conclusion, the need to evaluate emergency response

providers is a requirement under the OSHA standard and a goodpractice to minimize potential deficiencies for confined spacerescue events. Applying typical and innovative evaluation tech-niques need to be created by the employer and reviewed withresponding providers before there is an actual confined spaceemergency. When the alarm sounds, it is not the time to evaluatethe competencies and equipment needed to affect a confinedspace rescue. Aggressive preparation and evaluation will helpsecure an understanding of the required elements that each part-ner—facility and responders—brings to the table when secondscount. ■

This article was originally published by AIST in Iron & SteelTechnology. It is reprinted here with permission.

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RNDT, Inc. is a full service nondestructive testing (NDT)laboratory headquartered in Johnstown. In addition to being anA2LA ISO-17025 accredited laboratory, RNDT also offersfield services to all industries through its fleet of mobile dark-rooms. The company provides NDT in the form of industrialradiography, positive material identification (PMI), liquid pen-etrant, magnetic particle, ultrasonic testing and visual (CWI)inspections.

RNDT, Inc. is the result of lifelong dreams had by its presi-dent and vice-president, Fred E. Raco, Jr. and Allan R.Thomassy, Jr. After 20-plus years of hard work in differentareas of the country, they created the business to showcasetheir experience in the field. In 2002, the company was origi-nated by three individuals and has now grown to employ 38full time Level II technicians and nine office support staff,which includes three ASNT Level III examiners.

Each RNDT technician is a native of the Johnstown areaand has been brought up through RNDT’s internal school ofNDT, which is instructed by its own Level III examiners. Theinspectors are experienced in all applicable codes, compressorstations, fabrication shops, welding inspection, pressure ves-sels, pipelines, welding procedures and many other areas of thefield. RNDT is the only commercial testing and research labo-ratory in Pennsylvania that has staff ASNT NDT Level III

Examiners in UT, RT, AE, MT, PT and VT, as well as,Pressure Equipment Directive 97/23 EC Level III Examiners inUT, RT, MT and PT. These certifications satisfy global require-ments for NDT personnel. RNDT also employs ASNT ACCPProfessional Level III examiners in the testing methods of UT,RT, MT, PT and VT. The company’s list of credentials can befurther extended with AWS-CWIs and OSHA crane inspectors.

When the shale boom really began in Pennsylvania, RNDTwas already formed and ready to meet the needs of companiesneeding inspection services. Being headquartered in the heartof the Marcellus Shale, RNDT is well experienced in servicingthe oil and gas industry due to its lifetime in the area. It nowserves companies involved in gas and oil production through-out all of the Marcellus and Utica areas (Pennsylvania, Ohio,New York and West Virginia).

With competitive rates, technical expertise and experience,RNDT has satisfied clients for years. In fact, it has beenlearned that the closer they work with customers, the moreknowledgeable the customers become about the value that isafforded by allowing experienced professionals handle theirNDT related needs.

The mission of RNDT, Inc. is to strive to be the unsur-passed commercial testing laboratory through commitment,integrity and experience. “Quality Through Prevention” is inte-grated into all their work. Personal and friendly service cou-pled with conscientious attitudes equals a winning combinationfor clients. The foundation of RNDT is its employees and it’sthe purpose of the employees to serve the clientele. Therefore,at RNDT the customer comes first and it’s of the utmostimportance to meet the customer’s needs not only through hardwork, but on the level of a personal, individualized businessrelationship.

Get more information on RNDT, Inc. by visitingwww.rndt.net, call 814-535-5448 or email info@rndt.net.

PIOGA Member Profile

In an effort to increase efficiency and consistency, theDepartment of Environmental Protection now collects naturalgas production data from operators of unconventional natural

gas wells on a monthly basis. Production data was previouslyreported on a semi-annual basis every February and August.

The Unconventional Well Report Act, passed by the GeneralAssembly last October, requires operators of unconventionalwells to supply monthly gas production data to DEP. Thisrequirement took effect in the beginning of this year, withJanuary’s production data due by midnight on March 31. All sub-sequent months’ production data will be due 45 days after theend of the month of production. The February 2015 monthly pro-duction report is due no later than April 14.

As of the March 31 deadline, 80 percent of operators reportedtheir production for January, DEP reported. The operators thatmet the deadline represent 99.5 percent of unconventional naturalgas wells in Pennsylvania.

DEP conducts data verification to ensure that required data issubmitted on time and that no gross errors are identified. DEPconducts compliance oversight of operators who fail to complywith the reporting requirements.

Production data is self-reported by operators and reported dataare submitted to the department electronically. As soon as it issubmitted, production data is available on DEP’s Oil and GasReporting website.

Operators of unconventional wells continue to report wastetwice a year. Additionally, the act did not affect the frequency ofproduction reporting for operators of conventional wells.Conventional well operators will continue to report their produc-tion data on an annual basis.

For more information, or to view the production data, visitwww.dep.state.pa.us and click the “Gas Production Reports” but-ton. ■

DEP begins to collect monthly natural gas production data

Page 30 The PIOGA Press

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New DEP well transfer andstatus change procedures By Gary SlagelSteptoe & Johnson

The Pennsylvania Department of Environmental Protectionhas developed new instructions for handling oil and gaswell transfers and status and ownership changes. DEP is

asking operators that as they update their well inventories thatthey be aware of these requirements when they submit informa-tion back to the appropriate DEP district office. The instructionssummarized here are in a presentation distributed by the DEP’sSeth Pelepko and available on PIOGA’s website atwww.pioga.org/new-dep-well-transfer-and-status-change-proce-dures.

The presentation lists four areas of focus: • Well transfers• Well status changes• Well type changes• All other changesWell transfer details consume the largest portion of the pres-

entation. Here operators are directed to complete the DEP’sApplication for Transfer of Well Permit (5500-PM-OG0010) andto use the presentation’s checklist to ensure all necessary infor-mation is included. The checklist identifies the seven steps oper-ators must complete in addition to a permit holder resolutiondocument. It is noted that the department has 45 days from thedate of receipt to approve or deny the transfer request. Part ofthis process involves DEP completing a compliance historyanalysis of both parties involved in the transfer.

Well status changes require that the operator determine theactual status of the well (plugged, inactive, active or neverdrilled) and to submit the proper documentation to DEP so thenecessary changes can be made to its database.

Well types beyond production are storage, injection or obser-vation. Any changes in the type classification must be submittedto the DEP along with the necessary documentation.

DEP notes that there can be other issues associated with trans-fers, status changes and type changes not covered in the presen-tation, and readers are directed to call DEP at 717-772-2199 withany questions. ■

April 2015 Page 31

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February 2014 Page 33April 2015 Page 33

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

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Page 34 The PIOGA Press

New PIOGA members — welcome!

AMCi Wireless2733 Harbison Street, Natrona Heights, PA 15065-1728720-413-4658www.satalarm.comService Provider

Beaver County Chamber of Commerce798 Turnpike St, Beaver, PA 15009724-775-3944beavercountychamber.comAssociate

Brigadier Pipelines, Inc.P.O. Box 78, Burlington , PA 18814570-468-8052www.brigadierpipelines.comService Provider

Keystone Surveying & Mapping, Inc.199 South John Road, Building No. 2, Houston, PA 15342724-514-7949www.keystonesurveying.comProfessional Firm

RNDT, Inc.228 Maple Avenue, Johnstown, PA 15901-1551814-535-5448www.rndt.netService Provider

Terra Novo, Inc.14 Wincrest Drive, Queensbury, NY 12804518-222-3916www.terranovo.comService Provider

Have industry colleagues or vendors you thinkshould be PIOGA members? Encourage them toclick on “Join PIOGA” at the top of ourhomepage, www.pioga.org. Or, let us know andwe’ll contact them. There’s strength in numbers!

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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 (lou@pioga.org), President & Executive DirectorKevin Moody (kevin@pioga.org), Vice President & General Counsel Debbie Oyler (debbie@pioga.org), Director of Member ServicesMatt Benson (matt@pioga.org), Director of Internal Communications

(also newsletter advertising & editorial contact)Joyce Turkaly (joyce@pioga.org), Director of Natural Gas Market

DevelopmentDan Weaver (dan@pioga.org), Public Outreach DirectorDanielle Boston (danielle@pioga.org), Director of AdministrationChris Lisle (chris@pioga.org), Manager of Finance Tracy Zink (tracy@pioga.org), 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 35April 2015 Page 35

PIOGA EventsPIOGA Summer Picnic & Golf Outing

June 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 EventsNorth American Coalbed Methane Forum Spring Session

May 20-21, Hilton Garden Inn Southpointe/Pittsburgh,CanonsburgInfo: www.nacbmforum.com/conference.html

U.S. Energy Information Administration 2015 ConferenceJune 15-16, Renaissance Washington, DC Downtown HotelInfo: /www.fbcinc.com/e/eia

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

IOGANY 35th Annual MeetingOctober 21-22, Buffalo Marriott Niagara, Amherst, NYInfo: www.iogany.org/events.php

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

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