July 2014 • Issue 51

The

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

(Continues on page 2)

(Continues on page 38)

®

With the annual June 30 deadline for passage of the statebudget fast approaching, a severance tax on unconven-tional gas started to look like a real possibility as leg-

islators considered ways of filling a billion-dollar hole in thebudget. But thanks to a unified effort by the industry and othersupporters of natural gas development, the $29.1-billion spend-ing plan delivered to Governor Corbett by the General Assemblywas devoid of a severance tax.

Corbett held off signing the legislation until July 10 and exe-cuted line-item vetoes on $65 million in General Assemblyspending another $7.2 million in legislative-designated spendingto signal his dissatisfaction over lawmakers’ lack of action onaddressing pension reform for state employees and teachers.

One piece of the budget package, known as the fiscal code(House Bill 278), instructs the various segments of state govern-ment on how appropriations are to be spent. Of significance tothe industry is that this legislation includes provisions from HB2350 and SB 1378 directing the Department of EnvironmentalProtection (via the Environmental Quality Board) to develop sep-

State budget passed without severance tax

arate regulations for conventional and unconventional operations. Both HB 2350 and SB 1378 had received committee approval

in their respective chambers just before the language found itsway into the budget package. In a memo outlining his Senate

Equal Access to Justice Act. Under the act, fees can be recoveredwhen the government is unable to show that its position in theunderlying litigation “was substantially justified.” Recovery forsuch costs is capped under the law.

The legal actions date back to 2007, when the PennsylvaniaOil & Gas Association (POGAM), one of PIOGA’s predecessororganizations, challenged revisions to the agency’s ANF land andresource management plan that imposed numerous illegal condi-tions and design standards on oil and gas operations. Because 93percent of the ANF’s subsurface is privately owned, the industry

argued that under the 1911 Weeks Actand the ANF acquisition deeds, theForest Service did not have the right toplace conditions on or regulate an oper-ator’s access to its oil and gas holdings.POGAM also objected to the fact thatthe illegal oil and gas restrictions werehidden from public view when insertedin the final version of the managementplan in the 11th hour and withoutopportunity for public comment.

Resolution of that case was put on

PIOGA supports House NGV resolution. . . . . 6DEP plans another major rulemaking. . . . . . . 8See you at Seven Springs! . . . . . . . . . . . . . . 11Coming up: Divot Diggers . . . . . . . . . . . . . . . 11A look back at PIOGA’s Summer Picnic . . . . 12Thanks to our EOGCTS sponsors . . . . . . . . 14New oil & gas resource book . . . . . . . . . . . . 15Who qualifies as a public utility?. . . . . . . . . . 16Safety Corner: I2P2 update . . . . . . . . . . . . . 20Significant ruling in “title wash” case. . . . . . . 22June Spud Report. . . . . . . . . . . . . . . . . . . . . 24

Northeast LDC Forum report . . . . . . . . . . . . 29Virtual pipeline . . . . . . . . . . . . . . . . . . . . . . . 30The importance of participating in EIPC . . . 32Shippers driving transportation investment. . 34Think About Energy briefing . . . . . . . . . . . . . 36New well permit package . . . . . . . . . . . . . . . 37Oil & Gas Trends. . . . . . . . . . . . . . . . . . . . . . 40Calendar of Events . . . . . . . . . . . . . . . . . . . . 42New PIOGA members . . . . . . . . . . . . . . . . . 42PIOGA contacts . . . . . . . . . . . . . . . . . . . . . . 43

PIOGA secures, distributes partial refund of ANF legal fees

With the signing of a settlement agreement with the U.S.Forest Service in May, PIOGA recovered $530,000spent in attorney fees during the long-running legal

battle over the right to develop private oil and gas holdings in theAllegheny National Forest (ANF).

The association is paying off its final legal bills with themonies and then dividing the remainder proportionally among 48contributors to the ANF legal fund. Legal fees in the case cameto nearly $2.3 million. The recovery of the monies was obtainedunder a claim for attorney fees and expenses filed under the

Page 2 The PIOGA Press

Severance tax: Continued from page 1

version, the bill’s sponsor, Senate President Pro Tempore JoeScarnati, explained: “It is important to note that this legislationwould not relieve the conventional oil and gas industry from anyexisting or future health or safety regulations, which may beappropriate or necessary. Rather, it would ensure that both indus-tries continue to be held to the highest standards while not bur-dening the small shallow well drillers with regulatory require-ments, which are neither feasible or affordable for their indus-try.”

PIOGA strongly supports separate of regulations in light ofwhat has been occurring with the Department of EnvironmentalProtection’s Chapter 78 amendments (May Practical Operator,page 1), and we were pleasantly surprised that the provisionswere included in the budget legislation.

“The focus of the Department of Environmental Protectionhas been a one-size fits all approach and it’s certainly impactedconventional producers,” PIOGA’s Lou D’Amico told ShaleDaily. Beyond inappropriate regulations, he added, conventionaloperators “are facing stress on pricing, pipeline capacity andother things that aren’t helping them at all.”

Potentially, DEP could have to scrap the Chapter 78 rulemak-ing and start over in light of this legislation.

Battling the severance taxWith the Commonwealth facing a $1.4-billion deficit in the

2014-15 fiscal year, a significant number of lawmakers began toecho the call for a natural gas severance tax. Even Corbett, whohas been a staunch opponent of a production tax, held out thepossibility that he might consider such a levy if the GeneralAssembly would act on his two major priorities—pension reformand privatization of liquor sales (the latter was included simplyas a $300-million revenue item in the budget, with no actual pri-vatization plan).

However, industry outreach efforts ranging from a truck-mounted rolling billboard on the streets of Harrisburg (see photoon page 36) to a barrage of letters from PIOGA members andother industry supporters ultimately convinced lawmakers that aseverance tax was a bad idea. A page posted on the PIOGA web-site (www.pioga.org/severancetax) addresses the myths about aseverance tax. Our thanks go out to all members who wrote theirrepresentatives and senators in opposition to a tax.

More state lands leasingThe spending plan includes $95 million in revenue from new

unconventional gas leasing of state-owned lands, $20 million

February 2014 Page 3July 2014 Page 3

RLA Premier Conference Center 28 Meeting Rooms

Full Service – One Price

Expectations Exceeded

� Customized Meeting Packages

� Retreat-like Setting � Ergonomic Furniture Design � State-of-the-art Technology � Executive Style Food

Service

For inquires or a personal tour, call

724-741-1024 info@theRLA.org

Regional Learning Alliance at Cranberry Woods 850 Cranberry Woods Drive Cranberry Township, PA 16066

www.theRLA.org

Page 4 The PIOGA Press

®

February 2014 Page 5July 2014 Page 5

more than the governor had proposed. Corbett issued an execu-tive order in late May repealing former Governor Rendell’smoratorium, allowing leasing provided that it causes no addition-al surface impacts on state lands (June PIOGA Press, page 1).

The additional leasing and transfer of money out of theDepartment of Conservation and Natural Resources’ Oil & GasLease Fund is under legal challenge by the PennsylvaniaEnvironmental Defense Foundation (PEDF). The foundationargues that DCNR was directed to lease additional state forestland without identifying the tracts to be leased or evaluating theimpacts on the surrounding public natural resources. Similarly,the PEDF said the directive to use the $117 from the Oil & GasLease Fund for DCNR operating expenses was made with noevaluation of the direct and cumulative impacts to the state forestand parks lands subject to oil and gas extraction and “withoutsoliciting any public input on the people’s rights to these publicnatural resources, the proposed impacts to them or to the use ofthe Oil & Gas Lease Fund.”

A Commonwealth Court judge ruled on June 5 that he wouldwait until completion of the budget process before determiningwhether the budget actions were legal under the EnvironmentalRights Amendment to the Pennsylvania Constitution.

PA One Call exemptionThe days leading up to the annual June 30 budget deadline are

a time of frenzied legislative activity as House and Senate lead-ers initiate action on a variety of measures in exchange for sup-port on the budget. One of those bills was HB 1607, which trans-fers enforcement authority for the PA One Call law from theDepartment of Labor and Industry to the Pennsylvania PublicUtility Commission.

While PIOGA has supported the transfer, the association hasopposed a provision in the bill ending an exemption frommandatory One Call participation for oil and gas productionfacilities and rural (Class 1) gathering facilities. In mid-June, HB1607 was amended in committee to retain the exemption for pro-duction and rural gathering lines associated with conventionalproduction, while removing the exemption for the larger-diame-ter, higher-pressure lines needed for unconventional wells. Thebill passed the House unanimously on June 27.

More legislative actionIn other industry-related activity late occurring in June:• HB 402, which provides a formal method for landowners

holding oil and gas leases to obtain a release from the lease uponits termination or cancellation, was approved without opposition

New from Universal Bacteria Specialist: An environmentally friendly biocide with 1,450 ppm FACs.

ENVIROLYTE biocide offers you a safe, biodegradable alternative to toxic biocides for controlling bacteria in crude oil production and processing.

SAFE FOR PEOPLE. GOOD FOR PRODUCTION.

© 2014 Universal Bacteria Specialist (UCS1405/0614)

Find out more at www.universalbacteria.com

or call 281.342.9555

E.P.A. Reg. No. 87636-2

A Safe Biocide (Except for Bugs)

Page 6 The PIOGA Press

by the House. • HB 2278, requiring that unconventional operators report

production to DEP on a monthly basis rather than every sixmonths, was sent onto the Senate with a unanimous vote.

• SB 1310, creating the Pennsylvania Grade CrudeDevelopment Advisory Council, reported from the SenateEnvironmental Resources and Energy Committee and was sentonto the Appropriations Committee. The council would, amongother things, advise DEP on the impact of regulations on conven-

PIOGA supports House resolutionon NGV fuel standards

The state House of Represen -tatives has approved a PIOGA-supported resolution urging

rejection of natural gas vehicle fuelstandards recommended by theNational Conference of Weights andMeasures (NCWM).

Users purchase compressed naturalgas (CNG) in a unit of measureknown as gasoline gallon equivalent(GGE), established in 1994 by theNCWM. The GGE standard benefitsthe end user because it represents an amount of compressednatural gas which has the same energy content as a gallon ofgasoline, thereby enabling consumers to readily compare cost.

However, in January 2014 the National Conference onWeights and Measures recommended repealing the GGE stan-dard and replacing it with a kilogram unit of measure. Such achange would create significant costs to fueling stations,requiring them to replace existing fuel dispensers, and createconsumer confusion. The NCWM also opposes a move toestablish diesel gallon equivalent (DGE) as the standardmeasure for liquefied natural gas (LNG), again favoring akilogram-based measure. The NCWM is scheduled to votethis month on the metric recommendation.

Representative Dan Moul (R-Adams) introduced HouseResolution 924 to express opposition to the NCWM propos-als. The resolution passed the House by a 181-18 vote on July2 and was sent to the governor, the state secretary of agricul-ture and the NCWM’s executive director.

In a letter of support for HR 924, PIOGA wrote: “TheGGE/DGE standards are consumer-friendly units of measure-ment because they represent an amount of CNG/LNG that hasthe same energy content as a gallon of gasoline/diesel fuel,which allows consumers to evaluate the cost differencesbetween natural gas and traditional motor fuels. Changing thestandard measurement unit to kilograms would create anuneven marketplace for CNG/LNG with regard to other alter-native fuels, rending comparative cost evaluations impossiblefor consumers as a practical matter, and stifle the use of natu-ral gas as a motor fuel.”

Serving the Oil & Gas Industry for over 90 years.

MRC CORPORATE OFFICE

Austintown, OH 330-799-1100 Bradford, PA 814-368-8145 Buckhannon, WV 304-472-3565 Carrollton, OH 330-627-0259 Columbus, OH 614-475-4033 Corbin, KY 606-523-9640 Horseheads, NY 607-739-8575 Hurricane, WV 304-562-5724 Indiana, PA 724-349-6823 Williamsport, PA 570-748-5276 Norton, VA 276-679-6452 Wooster, OH 330-264-0077

tional producers and promote ways of increasing production ofPennsylvania-produced crude oil. The 15-member panel wouldinclude two individuals appointed by PIOGA.

• SB 1443, which clarifies the Indigenous Mineral ResourcesDevelopment Act to allow mineral rights owned by the state tobe leased only when the Commonwealth also owns the surfaceland rights, was approved on a 49-1 vote by the Senate. The2012 law allows state-owned universities and certain other statelands to be leased for oil, gas, coal and mineral development.

You can find complete information about any piece of statelegislation at www.legis.state.pa.us/cfdocs/legis/home/bills/. ■

Purchasers of Penn Grade & Utica Crude Oil

77 N. Kendall Ave.Bradford, PA 16701

814-368-1200

www.amref.com

Dan PalmerCrude Relationship Mgr PA / NY

814-368-1263dpalmer@amref.com

ISO 9001:2008 Certified

Supplying Quality Lubricants Refined UsingPenn Grade Crude Oil

February 2014 Page 7July 2014 Page 7

Pre-Drilling Water Supply Inventory and Sampling

Post-Drilling Complaint Resolution and Investigations

Gas Well Permitting for Conventional and

Unconventional Plays

Development of High Capacity Groundwater Supply Wells

Soil & Groundwater Contamination Investigations

Assistance with Water Sourcing

Water Management Plan Preparation

SPCC/Control & Disposal Plans

Pre-Drilling Water Supply Inventory and Sampling

Post-Drilling Complaint Resolution and Investigations

Gas Well Permitting for Conventional and

Unconventional Plays

Development of High Capacity Groundwater Supply Wells

Soil & Groundwater Contamination Investigations

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

Expert Witness Testimony

Wetland Delineation and Aquatic Surveys

Disposal Well Permitting

Erosion & Sedimentation Control Planning

Fresh Water Determination Studies

Soil and Groundwater Remediation

Stray Gas Migration Investigations

Hydrogeologic Studies

Expert Witness Testimony

Wetland Delineation and Aquatic Surveys

Oil and Natural Gas Development ServicesOil and Natural Gas

Development Services

Meadville PAHouston PAWaverly NY

Visit us online at: www.moody-s.com

Groundwater & Environmental Professionals Since 1891Groundwater & Environmental Professionals Since 1891

Page 8 The PIOGA Press

DEP planning major rulemakingon subsurface activities

Despite being far from finished with one major oil and gasrulemaking, the Department of Environmental Protectionis planning significant amendments to its Chapter 78,

Subchapter D regulations governing subsurface activities. At theJune 26 meeting of its Oil and Gas Technical Advisory Board(TAB), DEP said draft regulations could be expected near theend of the year.

In the meantime, the department still faces a monumental taskin completing the Chapter 78, Subchapter C rulemaking, aprocess that could take nearly two more years. DEP reportedreceiving approximately 25,000 letters, emails and signatures onpetitions during the public-comment process that ended March14. The agency will include a comment response document aspart of draft final-form regulations, expected to be provided toTAB for input this fall. The department expects to work with tabon the final version of the regulations into spring 2015. Thefinalized regulations could go to the Environmental QualityBoard (EQB) in fall 2015.

TAB was told DEP is not certain whether it would use theadvance notice of final rulemaking (ANFR) process prior tosending the final Subpart C regulations to EQB for approval. Ifthe ANFR step is skipped, there will be no further opportunityfor public comment before the regulations would become final inlate spring 2016.

Addressing the unprecedented volume of input received onSubchapter C, which covers oil and gas surface activities, DEP

reported that many of the public comments were outside thescope of the rulemaking, addressing things such as bondamounts. Very few of the comments received from oil and gasindustry organizations were thought to be irrelevant (PIOGA’scomments were summarized in the April issue).

“The range of comments we got on these issues, I’ve neverseen anything like it in my 21 years in the department workingon any regulation,” said Kurt Klapkowski, DEP’s director of Oiland Gas Planning and Program Management. He observed that“there is no formula” for how the agency will incorporate thesecomments into the next draft of the rules.

The department acknowledged it apparently made a seriousmiscalculation of the estimated costs of the proposed regulationson industry, particularly for conventional producers.Considerable effort will be given to determining how DEP’s esti-mates were so different from those of industry. DEP did not dis-close how—or if—it would differentiate between conventionaland unconventional operations in the revised regulations.(Editor’s note: See the budget article in this issue regardingrequirements that DEP create separate regulations.)

Subpart D rulemakingTAB was provided with a concept paper outlining the issues

DEP plans to address in its Subchapter D rulemaking (availableon the TAB page of DEP’s website). The regulations cover welldrilling, operation and plugging, and the effects of the changeswill be felt by all segments of the industry. In one TAB mem-ber’s estimation, the involvement necessary for this rulemakingwill be as great as that for Subchapter C.

According to a presentation by DEP, five general categories ofproposed changes exist:

• Sections that were not modified substantively as part of thelast rulemaking, which occurred in February 2011 (e.g., wellplugging).

• Subjects that have not historically been addressed throughrulemaking (e.g., coalbed methane wells).

• Minor modification/clarification regarding sections that werechanged substantively as part of the February 2011 rulemaking.

• Consistency between chapters (e.g., discrepancies betweenChapter 78 and Chapter 79).

• New/substantively enhanced subjects associated with fielddata analysis and observation.

The advisory board strongly recommended that DEP let TABconvene industry discussions on the more contentious conceptsto fully evaluate the need for further regulation and decide whatbest practices might be available to address the valid concerns ofDEP, perhaps without additional rulemaking. ■

Physical and Hedging Expertise for the O&G Industry

Art Cipriani Frank Kronz Phill Sabol

www.asset-risk.com Phone: 412-886-1800

Houston Pittsburgh Chicago Denver

February 2014 Page 9July 2014 Page 9

Oil and Gas Support Services:Engineering, Survey, and Environmental.

ONE TEAM...LOCAL, EXPERIENCED, AND OVER 600 STRONG.

Engineering, Survey, and Enviro

Vast Expertise. Local Presence. Total Commitment.

Put us to work for you—just contact

Josh Hazen, RPLS, at (412) 494-0505, ext. 5111.

Or, learn more right now at

www.erdmananthony.com/oilandgas.

ONE TEAM…Local, Experienced, and Over 600 Strong.

Your Integrated Solution for Oil and Gas Engineering Support Services. Erdman Anthony and T. Baker Smith have teamed together to provide

you with the critical, multidisciplinary support services you need—

with a level of experience that will make you confident from day one.

With over 600 employees and combined experience of over a century,

we will:

Help secure your permits and approvals with smooth and consistent support;

Get you up and working on your next site;

Use our strong regional presence and familiarity with the area, people, and policies to keep things running smoothly;

Put safety first, through full compliance with state and federal regulations governing safety and environment.

Erdman Anthony 60 years of award-winning engineering experience

Experienced Marcellus Shale service provider

Broad-based services from survey to site development and inspection

350 employees

T. Baker Smith 100 years of oil and gas experience

Significant shale gas experience in Haynesville and Eagle Ford Shale plays

Permitting expertise

300 employees

Page 10 The PIOGA Press

• FOCUSED ON IMPROVED TECHNOLOGIES

• DEDICATED TO AN EXPERIENCED WORKFORCE

• PLEDGED TO ENVIRONMENTAL RESPONSIBILITY

• LEADING THE INDUSTRY IN CNG EQUIPMENT

• COMMITTED TO SAFETY AND TRAINING

The Cementing Professionals

O-Tex Pumping provides unrivaled primary and secondary cementing and specialty pumping services to America’s Energy Industry. In doing so, we strive to promote all qualities that are uniquely American. From new technologies to an experienced work force, we are proud to be “Running on America’s Fuel”.

INVESTING IN ENERGY INDEPENDENCE

724.256.9280

To learn more about our commitment to energy independence, visit our website today! www.otexpumping.com

February 2014 Page 11July 2014 Page 11

If you are readingthis before our July22-23 Pig Roast,

Equipment Show andConference at SevenSprings MountainResort, we hope you

plan to attend one or both days of our flagship event of the sum-mer.

Tuesday the 22nd is the day for fun and networking. There’sgolf and sporting clays in the morning. The pig roast and equip-ment show kick off at 1 p.m. You’ll find food, drink and music,along with entertainment including mechanical bull riding, a hand-writing analyst, caricature artist, chainsaw wood carver, AJA CigarCompany rep, Texas hold ‘em (two one-hour tournaments at 3 and4 p.m.), alpine slide discounts and artisans. Wrapping up the day isfireworks from Little Big Shots.

Wednesday’s conference runs from 9 a.m. to 4 p.m. (lunchincluded) and is themed “A Peek into the Future.” Topics includeconventional formations with horizontal drilling potential; direc-tional drilling with percussion tools; water disposal options;hydraulic fracturing of horizontally drilled conventional forma-tions; small-scale liquifaction for stranded Marcellus wells; LNGfor high horsepower; and CNG opportunities and vehicles.

For a detailed agenda and registration information, go to thePIOGA events section at www.pioga.org. Directions and informa-tion about Seven Springs is at www.7springs.com.

Coming up:Divot Diggers golf outing

Mark your calendar for the PIOGA Environmental Committee’s17th Annual Divot Digger Golf Outing, which takes place Friday,August 15, at Tam O’Shanter of Pennsylvania in Hermitage.

Details are being emailed to PIOGA mem-bers, but don’t wait to register once you

receive the notice, because the eventalways fills up quickly.

Everyone who participatesmust sponsor at one of the twoavailable levels. Proceeds helpwith PIOGA’s legislative andregulatory work in the envi-ronmental arena.

See you atSeven Springs!

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

Additional OfficesAllentown, PAPittsburgh, PA

WINNERNortheast

2013

Pittsburgh 412.497.6000

hdrinc.com

Bridging the gap between idea + achievement

Page 12 The PIOGA Press

➤ Title SponsorErgon Oil Purchasing, Inc.

➤ Tournament Picnic SponsorsAmerican Refining Group, Inc.Atlas Resource Partners, L.P.Kriebel CompaniesPennsylvania General Energy Company LLC

➤ Lunch SponsorHunting Titan

➤ Beverage SponsorVineyard Oil & Gas Company

➤ Happy Hour SponsorsEnerVest Operating, LLCPatriot Exploration Corp.Patterson - UTI Drilling Co., LLC

➤ Tee & Green SponsorsABARTA Oil & Gas Co., Inc.Aqua-Clear, Inc.Babst/CallandChief Oil & Gas LLCDawood Engineering, Inc.

Elite Gasfield Service (2)EnLink Midstream Operating, LPEnviroTrac Ltd.EQT CorporationFluid Delivery SolutionsFluid Recovery Services, LLCGas Analytical Services, Inc. (2)Greene’s Energy Group (2)Glenn O. Hawbaker Inc.J-W Power CompanyMoody and Associates, Inc. (2)Mount Chestnut Development, LLCNew Prospect CompanyNorthwest Savings BankOpen Flow Energy, Division of South Jersey EnergyPenn Air Notch Services, IncPLS Logistics ServicesSteptoe & Johnson, PLLCSummit Iron WorksSundahl & Co. InsuranceUSA Compression Partners, LLC

Thanks to our Summer Picnic Sponsors!

PIOGA’s 2014 Summer PicnicJune 16 • Wanango Golf Club

Far left: Dave Ditty of HuntingTitan mans the grill at lunchtime.Left: PIOGA’s Danielle Bostonwith 50/50 winner Ryan Gilsonfrom Cleveland Brothers.

February 2014 Page 13July 2014 Page 13

Page 14 The PIOGA Press

Our 2014 Eastern Oil & GasConference and Trade Show

SponsorsPlatinum & Premium Exhibitor

Blue Mountain, Inc.Pennsylvania One Call System, Inc.

Huntley & Huntley Energy Exploration, LLCDiamond

Blue Dot Energy Services (tote bag sponsor)Steptoe & Johnson, PLLC

GoldAtlas Resource Partners, L.P.

Babst/CallandChief Oil & Gas LLCKriebel Companies

Moody and Associates, Inc. (lanyard sponsor)Silver

American Refining Group, Inc.BLX, Inc.

Crowell & Moring, LLPK&L Gates, LLP

Pennsylvania General Energy Company, LLCPatriot Exploration Corp.

USA Compression PartnersBronze

ABARTA Oil & Gas Co., Inc.DORSO, LP

Meinert/Mashek CommunicationsPardee Resources CompanyPennEnergy Resources, LLCRegional Learning Alliance

Seneca Resources CorporationT&F Exploration, LP

Universal Well Services, Inc.XTO Energy

PatronElite Gasfield Service

Fortis Energy Services, Inc.Kessel Construction, Inc.

Leggette, Brashears, & Graham, Inc.M&M Pump and Supply, Inc.

Thank you for your support!

Digging Out Potential SavingsDigging Out Potential SavingsDigging Out Potential Savings

Side by Side Side by Side Side by Side

With YouWith YouWith You

Into the FutureInto the FutureInto the Future

Adrianne Vigueras

Vice President Energy Division

avigueras@ecbm.com

888-313-3226 ext. 1335

WWW.ECBM.COM

Insurance Brokers & Consultants

www.safety-law.com

The Law Office of Adele L. Abrams PC focuses its practiceon defending employers in MSHA, OSHA and EPA litigationnationwide. Our 10 attorneys include Certified Mine SafetyProfessionals and Certified Industrial Hygienists who canevaluate citations, represent your company in settlementconferences, and be strong advocates for you in litigation.We provide safety training (MSHA Part 46 and 48), safetyand health audits, and program development and reviewservices. Our attorneys are admitted in PA, OH, MD, MI, DC,MT and SC, and many federal courts.

DDon’t go it alone …. call the pros!

301-595-3520

MSHA, OSHA orEPA Woes?

February 2014 Page 15July 2014 Page 15

As energy education continues to be a critical componentto the growth of our industry, a joint effort by all thestate trade groups (PIOGA, ANGA, API-PA and MSC)

to develop a resource book that highlights all aspects of theindustry—from drilling to completion—has been developed andis now ready fordistribution.

One of the firstdistribution eventswas held on July18 at the statecapitol building,where 410 legisla-tors, departmentsecretaries and thegovernor’s officereceived a copy ofthe Oil andNatural Gas inPennsylvaniaresource book.Industry represen-tatives from thetrade groups andcompaniesengaged in drilling/production talked one on one with legislatorsduring the book release breakfast and hand-delivered theresource book to legislators who were unable to attend the event.

ernstseed.comsales@ernstseed.com800-873-3321814-336-5191 (fax)

ResponsibleReclamationAn opportunity to restore diversity

• Conservation seed mixes

• Pollinator forage

• Native seeds

• Bioengineering materials

Resource book created as educational tool for legislators, stakeholders

Efforts continue to distribute the book to counties and other keystakeholders.

If you have any questions or would like to receive a copy ofthe book, contact Dan Weaver at dan@pioga.org. We have a lim-ited number of copies, so any requests will be first come, firstserved. ■

From left, Ali McFadden from the Marcellus Shale Coalition,Danielle Boston from PIOGA, Mary Wolf from AnadarkoPetroleum Corp., Susan Oliver from WPX Energy, and StephanieWissman from Associated Petroleum Industries of PA attendedthe legislative breakfast and distributed the book.

Page 16 The PIOGA Press

PUC pipeline case presentsissue of who qualifies as apublic utility corporation

Arecently filed case before the Pennsylvania Public UtilityCorporation (PUC) raises the issue of what type ofpipeline company qualifies as a “public utility corpora-

tion” under Pennsylvania statutes. The term is not defined in thePublic Utility Code, although the statutes authorizing exemptionsfrom local zoning, subdivision and land development ordinances(collectively “zoning ordinances”) and the exercise of eminentdomain power require applicants to qualify as public utility cor-porations in order to make use of the exemptions and eminentdomain. The case now before the PUC could affect the availabili-ty of the exemptions from local regulation and use of eminentdomain for pipelines in Pennsylvania.

Sunoco’s PUC operationsSunoco Pipeline, L.P. is a Texas limited partnership formed in

2001. In 2002, the PUC approved a merger between Sunoco andtwo pipeline companies, which transferred the assets of the com-panies and permitted Sunoco to provide intrastate transportationof petroleum products in the former service territories of thepipelines.1 The acquisition permitted Sunoco to operate an inte-grated intrastate pipeline system to transport petroleum productsfrom east to west in Pennsylvania. In 2013, the PUC approved anapplication filed by Sunoco to abandon a portion of certain serv-

ice along portions of its pipeline system andto suspend a portion of certain tariff servic-es along other segments for the transporta-tion of petroleum products.2 Sunoco alsofiled a petition to temporarily suspend itstariffed transportation service for petroleumproducts on certain pipeline routes.3 ThePUC approved both the abandonment appli-cation and the suspension petition.4 Sunocofiled the applications to facilitate its con-struction of an interstate pipeline projectcalled Mariner East.

Sunoco’s Mariner East projectThe Mariner East project involves a

combination of new pipeline facilities and the use of existingSunoco pipeline facilities that will transport ethane, propane, liq-uid petroleum gas and other petroleum products from an originpoint in Houston, Pennsylvania, to a delivery point located inClaymont, Delaware, within the Marcus Hook IndustrialComplex (MHIC).5 In March 2014, Sunoco filed 31 petitionswith the PUC requesting an exemption from local zoning, subdi-vision and land development ordinances pursuant to Section 619of the Municipalities Planning Code (MPC), 53 P.S. § 10619.Following publication of notices of filing of the petition with thePUC, municipalities and other interested parties filed preliminaryobjections, protests and letters in opposition to the petitions,arguing that the pipeline project failed to meet the standards foran exemption from local ordinances. Letters in support of thepetition were also filed. An issue raised in most of the protests

Daniel P.Delaney

Authors:

February 2014 Page 17July 2014 Page 17

and objections is that Sunoco does not qualify as a “public utilitycorporation” as required by the MPC. The 31 petitions have beenassigned to two PUC administrative law judges for decisions onthe protests and objections and also to hold such hearings as nec-essary to rule on the petitions.

Sunoco’s PUC petitionsSunoco’s petitions indicate that the project will require the

construction of 17 valve stations in 15 different municipalities,and the construction of 18 pumping stations in 18 differentmunicipalities. The petitions request an exemption under Section619 of the MPC for the construction of these facilities, whichwill prevent local municipalities from applying their zoning andsubdivision and land development ordinances to the proposedconstruction. In May 2014, Sunoco amended its petitions inresponse to the objections it received to its initial filing, indicat-ing that Sunoco will file a tariff supplement and initiate intrastateservice on the Mariner East line by transporting propane bypipeline from Mechanicsburg, Pennsylvania, to its Twin Oaks,Pennsylvania, facility at an estimated volume of 5,000 barrelsper day. Additional protests and objections were filed to theamended petitions raising the same or similar objections.Additional letters in support of the amended petitions were alsofiled.

Section 619 of the Municipalities Planning CodeSection 619 of the MPC authorizes the PUC, upon petition by

a public utility corporation, to exempt the corporation from localzoning requirements if the PUC decides that the present or pro-posed situation of the buildings in question is reasonably neces-

sary for the convenience or welfare of the public. The MPC doesnot define the term “public utility corporation,” but the PUC inprior cases has applied the definition contained in Section 1103of the Business Corporation Law (BCL), 15 Pa. C.S. § 1103,which provides in pertinent part that a “public utility corpora-tion” is any domestic or foreign corporation for profit that is sub-ject to regulation as a public utility either by the PUC or by anofficer or agency of the United States. Many of the preliminaryobjections and protests filed to Sunoco’s petitions argue that thePUC has no jurisdiction to grant the exemptions requested bySunoco because it fails to qualify as a public utility corporationas defined in the BCL.

Sunoco’s petition argumentsIn its initial petition, Sunoco argued that it qualifies as a pub-

lic utility corporation under the BCL definition because it is afederally regulated common carrier under the InterstateCommerce Act (ICA). Sunoco argued that the extent and scopeof the Federal Energy Regulatory Commission’s (FERC) regula-tion of Sunoco under the ICA met all necessary indicia underPennsylvania law to qualify Sunoco as a public utility corpora-tion under the MPC and BCL. Sunoco also argued that the leg-islative drafting committee comments to the BCL demonstratedthe Pennsylvania Legislature’s intended broad application of thedefinition of public utility corporation and that its operationsshould also qualify under that basis. Sunoco explained thatMariner East will be providing open service to all members ofthe public on a non-discriminatory basis through FERC openseason requirements and, therefore, would be following all therequirements for public utility status under Pennsylvania

Page 18 The PIOGA Press

Supreme Court precedent. Sunoco argued in its amended petitionthat it qualifies as a public utility corporation under the BCL def-inition since its proposed intrastate propane transportation serv-ice qualifies as public utility service regulated by the PUC underexisting certificates of public convenience. Sunoco argued thatsince it will be filing a tariff for intrastate transportation ofpropane, it will be operating as an intrastate public utility andwill qualify on that basis as a public utility corporation asdefined in the BCL.

Arguments of the protestantsThe preliminary objections and the protests filed by interested

parties argue that Sunoco does not qualify as a public utility cor-poration under the BCL definition. Although the protestantsagree that Sunoco is a common carrier pipeline company underthe ICA and regulated by the FERC, they cite several decisionsof the FERC that state that common carriers are not consideredpublic utilities by the FERC.6 These parties cite FERC decisionsthat explain that, unlike public utilities, pipelines do not serveconsumers and pipeline regulation under the ICA was notdesigned to protect consumers.7 As a consequence, the regulationof common carrier pipeline companies is subject to differentstandards, and the FERC and the federal courts do not considerpipeline companies such as Sunoco to be public utilities sincethey are not engaged in service to the public.8 Under the deci-sions cited by the protestants, Sunoco is a common carrier butdoes not qualify as a public utility for purposes of the BCL defi-nition. The protestants also cite a recent decision of the YorkCounty Court of Common Pleas that held that Sunoco did notqualify as a public utility corporation since it was regulated as a

common carrier by the FERC and not as a public utility.9

The protestants and objectors also challenge Sunoco’s argu-ments that the proposed intrastate propane service identified inSunoco’s amended petition results in Sunoco qualifying as apublic utility corporation. Citing the lack of detail in the amend-ed petition, these parties argue that the proposed intrastate use ofthe pipeline identified in the amended petition is a subterfugedesigned to create PUC jurisdiction over the project. These par-ties note that Sunoco’s Twin Oaks facilities are directly connect-ed to the MHIC by pipeline and that any propane delivered toTwin Oaks could be readily transported to an interstate destina-tion using the existing pipeline connections with the MHIC.These parties also question whether it is physically possible todeliver propane directly to Twin Oaks as Sunoco claims since theidentified use of the pipeline is to transport both ethane andpropane together. An industrial process would be required to splitthe natural gas liquids transported by the pipeline into its compo-nent parts, including ethane and propane. Since Sunoco has notannounced plans to install an ethane/propane splitter on itsintrastate system, it is physically impossible for the pipeline tobe used for the intrastate transportation of propane as Sunoco hasclaimed in its amended petition. These parties argue that Sunocohas failed to demonstrate any realistic intrastate use of thepropane and that it will ultimately be transported in interstatecommerce to other destinations for foreign export.

ConclusionSunoco’s petitions will be decided initially by the two PUC

administrative law judges who have been assigned these cases.The ALJs’ decisions will ultimately be reviewed by the PUC itself.The arguments presented by Sunoco and the protestants raiseissues that have not been previously decided by the PUC inSection 619 MPC proceedings. Several of the arguments presentfactual issues, which may be resolved by testimony. If the case isfully litigated, it may take six to nine months before the PUCenters a final order on the petitions. ■

1 Joint Application of Sunoco Pipeline, L.P., et al., PUC Dkt. No. A-140001, etseq. (corrected order entered January 28, 2002). 2 Application of Sunoco Pipeline, L.P., PUC Dkt. No. A-2013-2371789. 3 Petition of Sunoco Pipeline, PUC Dkt. No. P-2013-2371775.4 Order entered at the above dockets on August 29, 2013 and clarified subse-quently on October 17, 2013.5 Most of the Mariner East project makes use of Sunoco’s existing pipeline infra-

structure. However, Sunoco has recently filed an application with thePUC to add a 51-mile extension to its system from Houston,Pennsylvania, to Delmont, Pennsylvania, for the project at PUC Dkt. No.A-2014-2425633. See 44 Pa. B. 3825, published June 21, 2014.6 See Farmers Union Central Exchange v. FERC, 584 F.2d 408, 413(D.C. Cir. 1978), cert. denied, 439 U.S. 955 (1978); Williams Pipe LineCo., 21 FERC ¶ 61, 260 (1982).7 Lakehead Pipeline Co., 65 FERC ¶ 63, 021 (Initial Decision Dec.1993), and Williams Pipe Line Co., 21 FERC ¶ 61, 260 (1982).8 Revisions to Oil Pipeline Regulations Pursuant to the Energy Policy Actof 1992, 65 FERC ¶ 61, 109 (1993).9 Sunoco Pipeline, L.P. v. Loper, Dkt. No. 2013-SU-4518-05 (York Co.Feb. 24, 2014), affirmed on reconsideration at Dkt. No. 2013-SU-4518-05(York Co. issued Mar. 25, 2014).

February 2014 Page 19July 2014 Page 19

Page 20 The PIOGA Press

Safety Committee CornerSafety Committee CornerI2P2 updateBy Adele L. Abrams, Esq., CMSPLaw Office of Adele L. Abrams PC

When the Occupational Safety & Health Administration(OSHA) released its most recent semi-annual regula-tory agenda in late May (published in the June 13

Federal Register), one item drew most of the attention. The“I2P2” rulemaking (Injury and Illness Prevention Program),which previously was slated for small business review in Spring2014, with a proposed rule soon to follow, had been moved tothe “long term action” list. The next “due date” for this rulemak-ing, once labeled as the priority item for OSHA in the Obamaadministration, is now “to be determined.” The Mine Safety andHealth Administration (MSHA) also previously included I2P2 onits agenda, which would apply to frac sand producers, and thathas gone on “missing” status.

The I2P2 rule would involve planning, implementing, evaluat-ing, and improving processes and activities to protect workersafety and health. OSHA started down this path back in 1989with its Safety and Health Management Program standard (laterwithdrawn before finalization), and that proposed rule was turnedinto guidelines that are still published on OSHA’s website. Inaddition, such programs are already required for any employerthat seeks to attain Voluntary Protection Program status, and theVPP ranks are replete with success stories that point to the effec-tiveness of the I2P2 approach. Some of the voluntary consensusstandard organizations have also jumped on the concept: the

ANSI Z10 standard and the OHSAS 18001 series delineate theI2P2 approach for general industry, while the ANSI A10.33 stan-dard sets out I2P2 concepts for multi-employer worksites (gearedtoward construction).

Does the delay signaled by the Department of Labor’s regula-tory agenda indicate that OSHA and MSHA are no longer inter-ested in moving forward with I2P2? Not at all. Most likely, poli-tics is a factor. The agency has already come under considerableheat for the one OSHA agenda item to see the light of day: anew exposure limit and comprehensive occupational health pro-gram involving crystalline silica. OSHA was forced to extend thecomment deadlines multiple times, which now pushes action fur-ther down the road into 2015 and beyond.

With midterm elections coming in November, and given thecontentious nature of I2P2, delaying the release of a draft stan-dard eliminates the ability of the “loyal opposition” to makepolitical hay with this initiative. Moreover, given the limitedfinancial and staffing resources, it was improbable that OSHAcould do justice to two major rulemakings concurrently. Thereare other OSHA rulemaking items that have been pushed back aswell (combustible dust among them), while new items such asinfectious disease prevention have risen in priority status. MSHAalso has its hands full dealing with coal sector rulemakings aswell as a pending crystalline silica standard of its own.

Make no mistake, though, OSHA (at least) does plan on see-ing I2P2 through to fruition, although the announced delay raisesthe specter that this could be a “midnight rule” (depending onthe outcome of the 2016 presidential election) along the lines ofthe ill-fated ergonomics rule. As some will recall, that standardwas released in the final hours of the Clinton administration andwas promptly rescinded by Congress using the CongressionalReview Act as soon as President Bush took office. Of course, ifthe Democrats maintain the presidency for another four years,then OSHA will have all the time it needs to carefully craft anI2P2 standard that can withstand legal scrutiny.

So, is I2P2 a good idea and does it make sense to start devel-oping such a program even in the absence of OSHA require-ments? The answer is yes and yes. While many may debate theissues involved with OSHA enforcement of an I2P2 program—and the debate has ranged from whether OSHA will turn thisinto a supercharged “General Duty Clause” to whether smallestablishments can possibly create, implement and maintaincomplex programs that may be better suited to larger work-places—the devil will be in the details in terms of OSHA over-sight. For now, however, employers have the luxury of craftingan I2P2 program that is appropriate for their worksites withoutfederal dictates—and they are likely to find that injuries and ill-nesses will be reduced as a result (along with the correspondingworker’s compensation and lost productivity costs that ensue fol-lowing an industrial accident).

Also bear in mind that some businesses are already dealingwith I2P2 (or similar) requirements as a result of being locatedin states such as California or Washington, which run their ownOSHA programs and already have I2P2 program mandates thatare enforceable. In fact, 34 states and many nations around theworld already either require or encourage employers to imple-

Well Site Service Pros

FISHING SERVICES & TOOLS

RENTAL EQUIPMENT - DRILLING & COMPLETIONS

COMPLETION TOOLS

SLICKLINE SERVICES

API CERTIFIED MACHINE SHOPS

ACCOMMODATIONS

PIPE RECOVERY & WIRELINE

PRESSURE CONTROL SERVICES

To learn more about Blue Dot Energy Services, call 304.842.3829 or visit www.bluedotinc.com.

304.842.3829

740.922.1155

Essential Well Site Equipment and Superior Services

February 2014 Page 21July 2014 Page 21

ment these programs. In states where a regulatory mandate isabsent, often the state worker’s compensation rules will dictatediscounts for employers who voluntarily take these actions. TheCal-OSHA I2P2 program (the first in the nation) has not putemployers out of business but it has reduced incidence rates,although some studies suggest that “paper only” programs (thosethat meet the written prerequisites but are not truly implemented)do not yield the same benefits.

To be effective, I2P2 programs need to include the systematicidentification, evaluation and prevention (or control) of generalworkplace hazards and the specific hazards of the tasks to whichworkers would be assigned. Regardless of whether OSHA canenforce it, such generalized risk assessment is simply commonsense for any business and—of course—once hazards are identi-fied, it is incumbent on the employer to mitigate those risksthrough control measures. The hazard can range from unguardedmoving parts on a saw or conveyor system to the hazards ofimproperly stacked pallets to health hazards from bleach ornoise. Controls can be as simple as installing guards on convey-ors, implementing safer work practices, using personal protectiveequipment (where hazards cannot be controlled through engi-neering or administrative actions) and enrolling workers in ahearing conservation program where noise levels will exceed 85dBA on an eight-hour shift.

An effective I2P2 program goes beyond simply finding andcontrolling hazards, however. The major elements include:

• Management leadership. Management must establish clearoccupational safety and health goals, designate individualsresponsible for implementing and maintaining the program, andprovide resources necessary to ensure that the program can beeffectively implemented.

• Worker participation. Management must consult withworkers in developing the program and include them in programimplementation and evaluation. This means workers should par-ticipate in workplace examinations and audits, and should beencouraged to report hazards (and near misses) without fear ofreprisal.

• Hazard identification and assessment. Management mustgarner sufficient information through discussions with workers,inspection of facilities, and reviewing information on known andemergent hazards so that an effective risk management programcan be developed. A key step is scrutinizing injuries and illnessesto identify the hazards that caused them (avoiding a “blame thevictim” mentality and including things like soft-tissue injuries,which may reveal ergonomic issues that can be addressedthrough engineering or redesign of workstations, or simplythrough job rotation to reduce repetitive motions to some

degree). Another key step is training (or retraining) of workers toalert them to potentially hazardous conditions and to informthem on protection from such risks.

• Hazard prevention and control. I2P2 requires establishingand implementing a plan to prioritize and control hazards(including interim controls to protect workers from hazards thatcannot be controlled promptly). Moreover, once controls areimplemented, they must be continued to avoid backsliding orpermitting “shortcuts” to overtake established safe procedures.

• Education and training. Workers need to be trained on thetask-specific and general workplace safety rules, as well as onhazard recognition, reporting systems concerning injuries, ill-nesses and safety/health concerns, and their rights to participatein the I2P2 program. Moreover, training required under OSHAstandards will have to be repeated periodically in accordancewith the specific requirements.

• Program evaluation and improvement. I2P2 should notresult in a static document that collects dust on a shelf (a failingtoo often seen under the Cal-OSHA I2P2 rule). Periodic reviewsof the program will be needed to determine its effectiveness, andit may need to be modified as new hazards are identified or otherdeficiencies are noted. Continuous improvement should be thegoal.

The bottom line is, whether adopting I2P2 voluntarily or aspart of a regulatory program, employers will find that the invest-ment in safety is paid back through lower costs According to theNational Safety Council, an average worker injury involvingmedical treatment costs the employer $37,000 while a fatalitycan cost $1.4 million. An I2P2 program costs a fraction of a sin-gle injury and pays big dividends. ■

Page 22 The PIOGA Press

The Pennsylvania SuperiorCourt issues significantruling in ‘title wash’ case

By its own admission, the Superior Court of Pennsylvaniarecently issued a decision that it considered “at odds withmodern legal concepts” and one that might “be seen as

being unduly harsh.” Herder Spring Hunting Club v. Keller,decided May 9, (2014 PA Super 100), is the most recent affirma-tion of the oft-contested practice commonly known as “titlewashing.”

Title washing is a historical relic encountered by manyPennsylvania title practitioners involving the termination of oil,gas and mineral rights owned separately from the surface wherethe owners of such rights had failed to give notice to the tax col-lector of their “severed” interest. In Herder, the court was askedto decide who owns the subsurface rights to 460 acres located inCentre County, arising out of a mineral severance dating back to1899. Its decision proved a difficult task requiring the court toapply a point of law involving the interpretation of a statute from1806.

The concept of title washing had been largely irrelevant fol-lowing the 1947 rewriting of Pennsylvania’s real estate tax law,until oil and gas production from the Marcellus Shale made suchinterests significantly more valuable. Many people, including theKeller heirs in Herder, have had their hopes of cashing in onlong-forgotten family assets dashed upon discovering their

ancestors had unknowingly lost their miner-al rights through tax sales.

Understanding the Herder decisionrequires some familiarity with the legal andhistorical context of title washing. Prior tothe Pennsylvania Legislature’s 1947 over-haul of the real estate tax sale law, the 1806act distinguished between lands assessed as“seated” and “unseated” as it relates to taxsales. Seated land was land which had beenoccupied, improved or maintained by itsowners, or land that contained improve-ments. Unseated land was land whichremained unimproved (i.e., wild or in itsnatural state) and did not contain improve-ments. The two terms provide for differenttax liabilities; seated land was assessedagainst the person who held title to the landand its improvements, while unseated landwas assessed against the land itself.

A county treasurer’s sale of unseatedland could divest a previous severance ofoil, gas and mineral estates andmerge that estate with the surfaceowner. This process came to beknown as a “title wash.” Under atitle wash, the surface estate and the oil, gas, and mineral estatesare unified and conveyed to the grantee of a treasurer’s saleunless such oil, gas and mineral severances had been separatelyassessed. The tax sale would effectively “wash” (or divest) thetitle of the prior severance and vest the tax sale purchaser withall right, title and interest in both the surface and the oil, gas andminerals. However, if the oil and gas had been separatelyassessed, then the tax sale of unseated lands would not vest thesubsurface rights in the tax sale purchaser (i.e., no title washingoccurs). Therefore, in order for a title wash to occur, the partyclaiming title to the oil, gas and/or minerals would need to provethat: (1) the land was unseated, and (2) the oil, gas and mineralshad not been separately assessed as of the time of the tax sale.

Some of the most hotly contested title wash cases haveinvolved allegations that the surface owner of unseated landsintentionally allowed his property to go to tax sale in order to re-acquire the severed oil, gas and mineral rights. Under thisscheme, the surface owner arranged for a middle man to pur-chase the land. The middle man would re-convey the land to thepre-tax sale surface owner after the two-year redemption periodhad run. In such cases, the aggrieved heirs of the former ownersof the subsurface rights contest the surface owner’s ability tobenefit from his own wrongdoing.

The relevant transactions in the Herder case are not of thesame tenor, making the case for a title wash more palatable. In1899, Harry and Anna Keller conveyed the 460 acres of unseatedland excepting and reserving unto themselves all the oil, gas andminerals. The surface of the 460 acres was subsequently trans-ferred on several occasions. In November 1935, the CentreCounty commissioners acquired title to the property via a trea-surer’s sale. The property was offered for sale by the treasurerfor unpaid real estate taxes. No bidder bid the upset price and thecommissioners purchased the property. By deed dated June 3,1941, the Centre County commissioners sold the property to

Paul J. Atencio,Esq.

Bruce F. Rudoy,Esq.

Authors:

www.fmctechnologies.com

Frac Flowback

Cased HoleWireline

Fiber OpticLogging

FMC Technologies Completion Services, Inc.2170 Washington Road, Canonsburg, Pennsylvania 15317 Phone: 724.916.4852

Completionswithout Compromise

July 2014 Page 23

Max Herr.As recited in the opinion, in 1959, Herder was interested in

purchasing the property from Mr. Herr’s widow. A title searchwas performed and Herder became aware of the reservation.Herder’s attorney suggested to Ms. Herr’s attorney that he should“cover the exception by a specific clause making the conveyancesubject to all exceptions and reservations as are contained in thechain of title.” Herder’s deed dated November 30, 1959, reflected“this conveyance is subject to all exceptions and reservations asare contained in the chain of title.”

The trial court awarded the subsurface rights to the propertyto the Keller heirs. In doing so, the trial court found that Harryand Anna Keller’s reservation of subsurface rights was recorded,Herder was aware of the reservation of rights, and therefore, theKeller heirs were entitled to those rights. The Superior Court dis-agreed, and held that the Kellers’ oil, gas and mineral rights hadbeen lost through the 1935 tax sale. To get to its holding, theSuperior Court found that the resolution of the matter turnedupon interpreting Section 1 of the 1806 act as it applied to thefacts of the case.

Section 1 of the 1806 act required persons who acquiredunseated land to furnish a statement describing that land to thecounty commissioners, or the board of the assessment and revi-sion of taxes, so that a proper tax assessment could be levied.However, the section did not specifically address the situationpresented in the Herder case, where the subsurface rights to aspecific parcel of land were horizontally severed from the surfacerights, thereby creating two estates in the same parcel of land. Tounderstand how this severance affected the subsequent transfersof title, the court reviewed the state of the law as it existed at the

Largest

HDPE PipeStocking Distributor

in the EasternUnited States

Your HDPE Specialists: Fabrication • Fusion • Pipe I1-800-353-3747 • www.leesupply.com

QualityPEOPLE • PRODUCTS • SERVICE

Since 1954

SoilStabilization

relevant periods. The court surveyed various cases spanning aperiod of nearly 150 years, which consistently reflected that thefailure to separately assess severed, subsurface rights resulted inthe unseated land being assessed and valued as a whole,, i.e.,including the surface. If taxes on that land were not paid, therebysubjecting that property to levy and tax sale, then all that wasvalued, surface and subsurface rights, were sold as a unifiedwhole at the tax sale.

Although the 1959 deed from the Herr estate to Herder mademention of the “conveyance being subject to all exceptions andreservations as are contained in the chain of title,” there were noactive exceptions or reservations in the chain of title, the hori-zontal severance having been extinguished through the 1935 taxsale. The Superior Court could find no authority for the proposi-tion that such general language acknowledging the possibility ofexceptions or reservations serve to re-sever that which had beenunited.

The Herder decision proves to be another step closer to estab-lishing the title wash as an indisputable rule of property. Thecourt’s decision has its foundation on more than 150 years ofprecedent. The Keller heirs have made an application for re-argu-ment; however, they will have a difficult task convincing thecourt to overrule the longstanding practice, particularly where somany courts before it had expressed comfort with the “undulyharsh” result of the title wash. ■

Paul Atencio (patencio@babstcalland.com) and Bruce Rudoy(brudoy@babstcalland.com) are shareholders with the law firmof Babst Calland and members of the firm’s Energy and NaturalResources Practice Group.

Page 24 The PIOGA Press

ARG Resources Inc 7 6/2/14 047-24815 Elk Highland Twp6/5/14 047-24820 Elk Highland Twp6/10/14 047-24817 Elk Highland Twp6/16/14 047-24822 Elk Highland Twp6/19/14 047-24828 Elk Highland Twp6/24/14 047-24816 Elk Highland Twp6/30/14 047-24806 Elk Highland Twp

Branch John D 1 6/24/14 123-47609 Warren Pleasant TwpBull Run Energy LLC 2 6/16/14 123-47575 Warren Sugar Grove Twp

6/19/14 123-47574 Warren Sugar Grove TwpCabot Oil & Gas Corp 5 6/12/14 115-21698* Susquehanna Gibson Twp

6/12/14 115-21699* Susquehanna Gibson Twp6/12/14 115-21700* Susquehanna Gibson Twp6/12/14 115-21701* Susquehanna Gibson Twp6/1/14 115-21714* Susquehanna Jessup Twp

Cameron Energy Co 7 6/4/14 123-47527 Warren Sheffield Twp6/10/14 123-47529 Warren Sheffield Twp6/12/14 123-47422 Warren Sheffield Twp6/16/14 123-47420 Warren Sheffield Twp6/19/14 123-47421 Warren Sheffield Twp6/24/14 123-47299 Warren Sheffield Twp6/26/14 123-47302 Warren Sheffield Twp

Catalyst Energy Inc 10 6/11/14 083-56155 McKean Lafayette Twp6/17/14 083-56358 McKean Lafayette Twp6/23/14 083-56347 McKean Lafayette Twp6/26/14 083-56356 McKean Lafayette Twp6/18/14 121-45553 Venango Allegheny Twp6/19/14 121-45556 Venango Allegheny Twp6/24/14 121-45554 Venango Allegheny Twp6/26/14 121-45555 Venango Allegheny Twp6/30/14 121-45559 Venango Allegheny Twp6/3/14 121-45532 Venango Cranberry Twp

Chesapeake Appalachia LLC 17 6/23/14 015-22924* Bradford Wilmot Twp6/23/14 015-22923* Bradford Wilmot Twp6/23/14 015-22917* Bradford Wilmot Twp6/1/14 115-21541* Susquehanna Auburn Twp6/1/14 115-21542* Susquehanna Auburn Twp6/1/14 115-21543* Susquehanna Auburn Twp6/7/14 115-20439* Susquehanna Auburn Twp6/26/14 115-21702* Susquehanna Auburn Twp6/26/14 115-21703* Susquehanna Auburn Twp6/28/14 125-27353* Washington Donegal Twp6/28/14 125-27366* Washington Donegal Twp6/29/14 125-27352* Washington Donegal Twp6/29/14 125-27355* Washington Donegal Twp6/30/14 125-27354* Washington Donegal Twp6/9/14 131-20414* Wyoming Windham Twp6/9/14 131-20415* Wyoming Windham Twp6/10/14 131-20454* Wyoming Windham Twp

Chevron Appalachia LLC 4 6/2/14 129-28860* Westmoreland S Huntingdon Twp6/4/14 129-28861* Westmoreland S Huntingdon Twp6/6/14 129-28862* Westmoreland S Huntingdon Twp6/6/14 129-28863* Westmoreland S Huntingdon Twp

Chief Oil & Gas LLC 15 6/23/14 015-22699* Bradford Asylum Twp6/19/14 015-22404* Bradford Overton Twp6/20/14 015-22405* Bradford Overton Twp6/25/14 015-22755* Bradford Pike Twp6/26/14 015-22757* Bradford Pike Twp6/27/14 015-22756* Bradford Pike Twp6/10/14 015-22744* Bradford Stevens Twp6/11/14 015-22741* Bradford Stevens Twp6/12/14 015-22742* Bradford Stevens Twp6/13/14 015-22743* Bradford Stevens Twp6/3/14 113-20260* Sullivan Fox Twp

Spud Report:June

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

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

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

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

Bituminous knows oil and gas.

When times get tough, Bituminous has been there. For more than 70 continuous years, Bituminous has offered high-quality insurance protection and services – with the stability you need and deserve.

If you’re looking for broad insurance coverage for your business at competitive rates, look no further

We’re more than a bit better…we’re a lot better.

Rock Island, Illinois 61201 1-800-475-4477www.bituminousinsurance.com

Bob Gregory, CPCU, Branch Manager, Pittsburgh1-800-253-1232 or 412-937-9000

What YOU do is what WE protect.™

February 2014 Page 25July 2014 Page 25

Extraordinary depth in mineral title

Dedicated to shaping energy law for the futurewww.steptoe-johnson.com

THE PROOFIS IN THE

NUMBERS

HIS IS AN ADVERTISEMENT

7,000 mineral title opinions in multiple plays in 2013

200 energy attorneys cross-trained to understand title in 22 states

One of the largest due diligence teams nationwide

More than 100 years of experience in energy law

20 attorney Division Order Title Opinion Team

Leader in unitization permits filed in the Utica Shale

Top-ranked in energy law by Chambers USA, The Best Lawyers in America®, and AV rated by Martindale-Hubbell

Sharon O. FlaneryENERGY AND NATURAL RESOURCES

DEPARTMENT CHAIR

Page 26 The PIOGA Press

February 2014 Page 27July 2014 Page 27

6/3/14 113-20255* Sullivan Fox Twp6/4/14 115-21426* Susquehanna Auburn Twp6/4/14 115-21427* Susquehanna Auburn Twp6/6/14 115-21813* Susquehanna Auburn Twp

CNX Gas Co LLC 7 6/17/14 059-26537* Greene Richhill Twp6/17/14 059-26538* Greene Richhill Twp6/17/14 059-26541* Greene Richhill Twp6/26/14 059-26522* Greene Richhill Twp6/26/14 059-26547* Greene Richhill Twp6/26/14 059-26539* Greene Richhill Twp6/26/14 059-26540* Greene Richhill Twp

Curtin & Curtin 2 6/17/14 123-47562 Warren Sheffield Twp6/24/14 123-47563 Warren Sheffield Twp

Devonian Resources Inc 4 6/6/14 053-30488 Forest Harmony Twp6/17/14 053-30599 Forest Harmony Twp6/24/14 053-30601 Forest Harmony Twp6/30/14 053-30490 Forest Harmony Twp

Energy Corp Of Amer 9 6/10/14 059-26515* Greene Greene Twp6/10/14 059-26516* Greene Greene Twp6/11/14 059-26513* Greene Greene Twp6/11/14 059-26514* Greene Greene Twp6/12/14 059-26511* Greene Greene Twp6/12/14 059-26512* Greene Greene Twp6/13/14 059-26517* Greene Greene Twp6/13/14 059-26518* Greene Greene Twp6/14/14 059-26568* Greene Greene Twp

EQT Production Co 7 6/4/14 059-26534* Greene Morgan Twp6/4/14 059-26535* Greene Morgan Twp6/4/14 059-26536* Greene Morgan Twp6/11/14 059-26527* Greene Morgan Twp6/12/14 059-26556* Greene Morgan Twp6/13/14 059-26557* Greene Morgan Twp6/19/14 059-26526* Greene Morgan Twp

Hilcorp Energy Co 9 6/28/14 073-20441* Lawrence Mahoning Twp6/28/14 073-20442* Lawrence Mahoning Twp6/7/14 073-20448* Lawrence Pulaski Twp6/7/14 073-20454* Lawrence Pulaski Twp6/7/14 073-20455* Lawrence Pulaski Twp6/11/14 073-20471* Lawrence Pulaski Twp6/12/14 073-20472* Lawrence Pulaski Twp6/12/14 073-20473* Lawrence Pulaski Twp6/12/14 073-20476* Lawrence Pulaski Twp

Howard Drilling Inc 1 6/3/14 083-56316 McKean Wetmore TwpInflection Energy LLC 1 6/30/14 081-21465* Lycoming Uppr Fairfield TwpMark & Troy Johnson 2 6/19/14 123-47599 Warren Sugar Grove Twp

6/23/14 123-47600 Warren Sugar Grove TwpKastle Resources Enterprises 2 6/12/14 039-25791 Crawford Beaver Twp

6/26/14 039-25790 Crawford Spring TwpLendrum Energy LLC 1 6/3/14 053-30447 Forest Harmony TwpMcCool John E 3 6/11/14 123-47418 Warren Mead Twp

6/14/14 123-47419 Warren Mead Twp6/18/14 123-47417 Warren Mead Twp

MSL Oil & Gas Corp 5 6/10/14 083-56138 McKean Lafayette Twp6/16/14 083-56136 McKean Lafayette Twp6/18/14 083-56137 McKean Lafayette Twp6/23/14 083-56135 McKean Lafayette Twp6/30/14 083-56134 McKean Lafayette Twp

NTS Energy LLC 1 6/2/14 121-45612 Venango Cranberry TwpPA Gen Energy Co LLC 5 6/12/14 081-21329* Lycoming Cummings Twp

6/13/14 081-21332* Lycoming Cummings Twp6/14/14 081-21330* Lycoming Cummings Twp6/14/14 081-21333* Lycoming Cummings Twp

6/15/14 081-21331* Lycoming Cummings TwpPennEnergy Resources LLC 7 6/11/14 007-20399* Beaver New Sewickley Tp

6/11/14 007-20400* Beaver New Sewickley Tp6/12/14 007-20397* Beaver New Sewickley Tp6/12/14 007-20398* Beaver New Sewickley Tp6/27/14 019-22192* Butler Clinton Twp6/28/14 019-22193* Butler Clinton Twp6/27/14 019-22191* Butler Jefferson Twp

Range Resources Appalachia 6 6/11/14 125-27130* Washington Cross Creek Twp6/30/14 125-27415* Washington Smith Twp6/30/14 125-27301* Washington Smith Twp6/30/14 125-27302* Washington Smith Twp6/30/14 125-27303* Washington Smith Twp6/30/14 125-27304* Washington Smith Twp

RE Gas Dev LLC 1 6/1/14 019-22212* Butler Lancaster TwpRedmill Drilling 1 6/14/14 019-22209* Butler Winfield TwpRice Drilling B LLC 4 6/24/14 059-26572* Greene Gray Twp

6/24/14 059-26569* Greene Gray Twp6/24/14 059-26570* Greene Gray Twp6/24/14 059-26571* Greene Gray Twp

Rick & Sons Oil LLC 3 6/5/14 123-47305 Warren Glade Twp6/10/14 123-47307 Warren Glade Twp6/26/14 123-47306* Warren Glade Twp

Seneca Resources Corp 11 6/24/14 023-20169* Cameron Shippen Twp6/24/14 023-20172* Cameron Shippen Twp6/26/14 023-20170* Cameron Shippen Twp6/27/14 023-20167* Cameron Shippen Twp6/27/14 023-20171* Cameron Shippen Twp6/27/14 023-20174* Cameron Shippen Twp6/28/14 023-20166* Cameron Shippen Twp6/29/14 023-20159* Cameron Shippen Twp6/29/14 023-20168* Cameron Shippen Twp6/30/14 023-20173* Cameron Shippen Twp6/30/14 023-20175* Cameron Shippen Twp

Southwestern Energy Prod Co 9 6/18/14 081-21452* Lycoming Jackson Twp6/18/14 081-21450* Lycoming Jackson Twp6/18/14 081-21451* Lycoming Jackson Twp6/2/14 115-21456* Susquehanna Jackson Twp6/4/14 115-21708* Susquehanna New Milford Twp6/5/14 115-21710* Susquehanna New Milford Twp6/5/14 115-21400* Susquehanna New Milford Twp6/6/14 115-21709* Susquehanna New Milford Twp6/13/14 131-20442* Wyoming Forkston Twp

Stiglitz Raymond J 1 6/25/14 121-45470 Venango Cornplanter TwpTalisman Energy USA Inc 2 6/17/14 115-21705* Susquehanna Little Meadows

6/18/14 115-21704* Susquehanna Little Meadows Trimont Energy LLC 8 6/2/14 053-30434 Forest Harmony Twp

6/10/14 053-30438 Forest Harmony Twp6/13/14 053-30441 Forest Harmony Twp6/17/14 053-30440 Forest Harmony Twp6/20/14 053-30439 Forest Harmony Twp6/27/14 053-30442 Forest Harmony Twp6/4/14 121-45678 Venango Allegheny Twp6/6/14 121-45676 Venango Allegheny Twp

XTO Energy Inc 8 6/5/14 019-22232* Butler Jefferson Twp6/17/14 019-22137* Butler Summit Twp6/17/14 019-22136* Butler Summit Twp6/17/14 019-22147* Butler Summit Twp6/17/14 019-22138* Butler Summit Twp6/17/14 019-22177* Butler Summit Twp6/17/14 019-22178* Butler Summit Twp6/17/14 019-22208* Butler Summit Twp

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

Page 28 The PIOGA Press

Vorys, Sater, Seymour and Pease LLP 500 Grant Street Suite 4900 Pittsburgh, PA 15219 412.904.7700

Columbus Washington Cleveland Cincinnati Akron Houston Pittsburgh

Higher standards make better lawyers.®

For more information on our work in oil and gas, visit vorys.com/shale.

OUR KNOWLEDGE OF THE OIL AND GAS BUSINESS

KNOWS NO BOUNDARIES.

on a national level, setting standards and helping producers and midstream companies

throughout the country. We’ve negotiated pipeline safety issues on behalf of the IPAA.

We’ve helped develop guidelines to review and assess oil and gas regulatory programs.

helping to create them. Which, of course, helps our clients — wherever they may be.

February 2014 Page 29July 2014 Page 29

Surprised but not shocked By Joyce TurkalyDirector, Natural Gas Market Development

Coming up with the right solution to address NewEngland’s peak day demands was the underlying themeof the 19th Annual LDC Gas Forum Northeast.

Winter’s price volatility was discussed by a panel at the event,held June 16-18 in Boston. A panel entitled “Risks, Challengesand Opportunities of Marcellus and Utica” spoke about the priceof spot gas into Algonquin city gate at $73 per MMBtu as wellas delivery points off Transco Zone 6 non-NY and Transco Zone5 at $123 and $120, respectively. A trader I spoke with whoended her day on January 7 in the $40 range was surprised whenshe looked at the published index the next day. When asking apanel of gas buyers for reaction to the spot market pricing thispast winter, all said they were surprised, but in no way shocked.These spot purchases represented only 1 percent of peak daydemand during those days of the polar vortices.

Given that New England forecasts 30 peak days during thewinter season, Anthony Scaraggi, GDF Suez, spoke to LNG forpeak demand when compared to an actual 2013-2014 winter sea-son experiencing 42 peak days that exceeded the historical NewEngland average of 3.4 Bcf/day. Distrigas of Massachusetts LLCowns and operates a liquefied natural gas (LNG) import andregasification called the Everett Marine Terminal. “Only in areaswith local supply will your downstream receive the cost benefitof shale gas,” stated Scaraggi, adding, “The cost of long haulpipelines does not make economic sense.” Showing the accompa-nying chart as part of GDF Suez presentation, Scaraggi estimateddemand prices to further illustrate why New England should uti-lize LNG for peaking.

Key natural gas pipelines from supply areas to New Englandare full or nearly full. The Algonquin Gas Transmission(Algonquin) system and the Tennessee Gas Pipeline (TGP) trans-

What a pleasure to be invited to thefirst Women in Natural Gas breakfastat the LDC Gas Forum in Boston. Witha promise of healthy breakfast foodsand good company, the ladies turnedout to support one another and thenatural gas industry. As introductionsand short bios were offered, it wasobvious we represent many companiesand a love for our industry. With a vowto support women in this business, allwere encouraged and inspired by oth-ers who are making a positive differ-ence for the betterment of our busi-nesses and the industry as a whole.Looking forward to the networking thatwill happen within this group of ladies! —Sandy Spencer, Appellation Pre-Fab

port most of the natural gas into the New England market.Recently, both of these systems have been constrained. Theforum highlighted 12 companies that provided pipeline projectupdates. Transportation will always be a significant cost compo-nent to consumers who do not have direct access to the supplyregions.

“Pipeline flexibility on both the downstream and upstream iskey” said Chris Shorts, director gas supply, Union Gas Limited.“As basins mature and infrastructure builds up, basis willincrease” stated Cynthia Armstrong, PNGTS. PNGTS receivesMarcellus gas at Niagara Falls and eventually at Iroquois. Withnatural gas consumption projected to increase substantially overthe next few decades to its low cost, reliability and low emis-sions, policymakers will be pressed to quickly remove barriers tobringing abundant natural gas supplies into New England mar-kets.

Demand for natural gas is going to go up by 2017 stated Dr.Jim Duncan, ConocoPhillips director of marketing analysis, whoopened the conference with his presentation entitled, “Will theNatural Gas Industry Find Harmony? Covering the Marcellusand Beyond “ He told the audience, “You are going to need allthe gas you can get.” ■

Page 30 The PIOGA Press

Physical solution: Virtual pipelineHow the energy industry is finding creativeresponses to provide natural gas to consumers

With the continuing success of natural gas developmentin shale plays across the nation, utility prices have sig-nificantly decreased. And as midstream infrastructure

continues to be built out, product is making the trek from sourcepoint to consumers.

While those statements are true in part, they don’t tell thewhole story.

The availability of affordable natural gas from unconventionalextraction has decreased wholesale prices. However, end-usershave not necessarily seen the same drop in prices. For example,natural gas is currently trading on the New York MercantileExchange for around $5 per Mcf. But in the middle of January2014, as winter continued its icy march across the country, peakhourly prices in Philadelphia from the city gate stations jumpedto $150 per Mcf. Right now, prices can be as high as around $11per Mcf for end-users in pipeline-restricted regions, with manycustomers purchasing for about $7 per Mcf. So while purchasingnatural gas on the wholesale market has proven to be very cost-effective, businesses and consumers purchasing it through stan-dard channels have seen the effects only in stable rates ratherthan decreases.

Alongside lower energy prices not yet making it to con-sumers, midstream pipeline infrastructure is still in the earlystages of build out. In some cases, midstream companies are uti-lizing existing pipelines to transport natural gas and its productsto various market regions. In others, local opposition and inten-sive regulations are delaying the process, increasing the timelinefor bringing more infrastructure into operation. So not all end-users have direct access to as much natural gas and its productsas they could.

Enter a bourgeoning trend in Pennsylvania where theMarcellus Shale play has been showingstrong production output for years: the vir-tual pipeline. Since natural gas is so plenti-ful in the northern tier and western end ofthe state, some companies have seen anopportunity to solve two challenges atonce: get more affordable natural gas toconsumers, and provide a new deliverymethod until pipeline infrastructure isavailable.

What is it?The virtual pipeline concept provides a

direct connection for businesses to receivenatural gas for operations. A private third-party entity constructs a compressed natu-ral gas (CNG) station near an upstream ormidstream pipeline, then loads the CNGonto trucks and delivers it directly tousers.

The third-party purchases the supplydirectly from an exploration and produc-tion company, and any clientele purchases

it directly from the private third-party busi-ness, eliminating volatile pricing and marketconditions.

Who will be using it?Throughout the recent severe winter in

Pennsylvania, many companies experiencedinterruptions to their gas supply. In somecases, this was because of industries’ (vol-untary) participation in a peak-flow system,designed to divert energy supply away fromsome users to others during peak use hours.Over the course of a normal winter, thismight occur a few times in Pennsylvania.However, during the 2013-14 winter, as theseverity of temperatures and storms contin-ued, many companies found themselveslacking the crucial energy supply needed tocontinue production and standard operationson a regular basis.

These companies—which include manu-facturers, commercial users or general serv-ice businesses—are now exploring virtualpipeline natural gas options to remove therisk of interruptible service.

Many businesses and organizations arealso looking into the possibility of lowering their utility overheadcosts, as right now the cost of trucking the natural gas supply viadiesel-fueled trucks might be a more economic choice. Truckstransporting the gas might also be powered by CNG, further low-ering costs and increasing benefits.

In some rural areas of Pennsylvania, businesses also existwithout access to natural gas for their energy needs. If and whenutility companies construct natural gas delivery pipelines to these

Yves Pollart,PE, VicePresident

Jason Wert, PE, Project

ManagerRETTEW

Authors:

July 2014 Page 31

locales, these operations might be able to participate in receivingnatural gas via virtual pipeline.

How does it work?A private company works with engineers and contractors to

design, permit and construct a CNG station located near a wellor midstream pipeline. The station owner might extend thepipeline to reach its terminal.

After tapping the pipeline, the gas runs through a meteringsystem to track volume. A CNG station can likely handle about5,000 to more than 25,000 Mcf of natural gas at one time. Then,the natural gas moves through a compressor to bring it fromabout 500-3,600 psi. The station tightly controls temperature ofthe gas. After passing through a dryer to remove any lingeringliquids, the tube trailer is filled with gas.

The trailer contains tubes about two feet in diameter and car-ries 16 of these tubes in “pods.” Truck hauling capacity is in the350 Mcf range. The truck then drives directly to the client’s loca-tion, anywhere from down the road to 100 miles away.

Arriving at a customer’s site, the trailer will hook to a decanti-ng system, reducing the gas as it’s used through a thermodynam-ic process to between 4 and 50 psi for commercial use. The trail-er then remains on site until its supply is depleted. Through avirtual monitoring system, the CNG station owner is alertedwhen the volume becomes low, scheduling another trailer full ofCNG to arrive as the supply is exhausted.

An end client might use several trailer loads each day, or keepa trailer on site for up to a week, depending on location andenergy needs. CNG station operators can own the tractors andtrailers they use for delivery, or they could lease the vehicles.Drivers might be CNG station employees or part of the truckinglease agreement.

Regardless of how the CNG station ownership and operationsare structured, these projects translate to local hiring of employ-ees as stations and virtual pipelines are designed, constructed andmaintained—from truck drivers to compressor station operatorsto administrative employees.

What’s next?The virtual pipeline concept will begin to develop both in

Pennsylvania and anywhere the market advances to provide amore affordable energy source directly to consumers.Commercial businesses can look into cost comparisons as CNGstations are built in their area.

E&P companies are also expressing interest in this develop-ment, especially those with a presence in rural geographies.Some oil exploration operators burn excess natural gas in quanti-ties worth millions of dollars each year, lacking the necessaryinfrastructure to get the byproduct to market. Installing a CNGstation, or partnering with a virtual pipeline operator, could pro-vide the opportunity for that natural gas to be used and profitedfrom, while providing communities off the beaten path with alow-cost energy supply. Virtual pipelines create an opportunityfor oil and gas companies to sell their byproducts to the market.

As the natural gas market evolves, natural gas companies willcontinue to find creative methods for getting their product tomarket. Virtual pipelines are just one of the options, assistingend-users in cost savings and stable energy supply.

Case studyRETTEW is designing, permitting and providing construction

services for the first virtual pipeline CNG station in LycomingCounty—likely the first of its kind in the midstate. This virtualpipeline will provide a route to supply Pennsylvania gas toPennsylvania customers faster and with less disruption than a tra-ditional pipeline.

With a service area radius of between 50 and 75 miles, theCNG station already has commercial customers lined up, and hasthe potential for a half dozen end-users depending on volume ofsupply requested. It will be constructed about 600 yards from anexisting compressor station, with easy highway access. All trac-tors in use will be day-cab tractors rather than long-distancehaulers and use only CNG fuel rather than diesel. About 10 localresidents will be hired at the station.

When completed, the CNG station will process up to 22 Mcfper day in natural gas flow to clients, with about 65 trucks deliv-ering on a daily basis. Maximum capacity will be about threefull-size truck loads each hour.

No liquids or fuels will be stored underground or onsite otherthan for incidental uses (lawn mowing, etc.). Thestation’s goal is eventually to have only CNG-fueled maintenance vehicles. The station has alsobeen designed to minimize the impact of any noiseor traffic to the local community—the CNG tractorsare about 30 percent quieter than similar dieselequipment. The station features plenty of room fortrucks to safely navigate, as well as berms andplantings to fit within the surrounding area.

Planned customers have said they will realizesignificant savings, resulting in making their busi-nesses more secure, stable, and profitable, as wellas allow them to consider expansion with the result-ing benefits for the local economy. ■

Emissions of a CNG tractor:■ Almost no particulates■ Almost eliminates sulfur and nitrogen oxides■ Almost removes volatile organic compounds (VOCs)■ Reduces greenhouse gas emissions 20-25 percent

Photos courtesy of Change Energy Services, Inc.

Page 32 The PIOGA Press

Why participating in the EIPCis important for PIOGABy Joyce TurkalyDirector, Natural Gas Market Development

If you examine the U.S. electric transmission and distributionnetwork, commonly referred to as the electric “grid,” youwill note three major interconnections in the lower 48:

ERCOT, which is most of Texas; Western, which extends fromthe Rocky Mountains to the west coast; and Eastern, which cov-ers the 39 states from the Atlantic to the foothills of the RockyMountains. Within each interconnection you have planningregions, and behind each planning region are individual states.The Eastern Interconnection Planning Collaborative (EIPC) is apartnership between 27 transmission planning authorities in theEastern U.S. The term “interconnection” means a geographicarea in which the operation of bulk-power system components issynchronized such that the failure of one or more of those com-ponents may adversely affect the entire region.

Transmission planning is a collaborative process taking intoaccount state and federal policy goals which address reliabilityand choice of fuel and associated air emissions. Transmissionprojects measure the economic benefits as compared to theircosts. They are designed to make the market more efficient andto allow the freer movement of power to where it is needed. PJMperforms regional system planning over a 15-year horizon. Theregional planning process identifies what transmission systemupgrades are necessary to meet customers’ operational, economicand reliability requirements

The Gas Electric System Interface Study that began last fall iswhat I would call a “spinoff” to the original EIPC study thatbegan two years prior. Given Marcellus Shale production thatoverlaid part of the study area, the U.S. Department of Energy(DOE) recognized a need to examine natural gas as a fuel forelectric generation. The EIPC, originally an eight stakeholder

sector committee, requested a ninth stakeholder group—one torepresent the natural gas industry—in the fall of 2013.

Participating in the EIPC process as a stakeholder in the Gas-Electric System Interface Study Committee is important due tothe increasing amount of coal-fired retirements, not only in ourstate, but throughout the Eastern Interconnection (see illustra-tion). Also important to the process is to hear stakeholder com-ment relative to natural gas as a reliable fuel source for electricgeneration. The word “collaborative” in this context means gath-ering input on a range of future scenarios that take into accountdiverse economic and policy conditions that would have sometype of affect or implication on the transmission system.

The federal Energy Information Administration forecasts thatby 2035 natural gas generation is projected to surpass coal gen-eration. Coal and natural gas are projected to each represent 34percent of total generation in 2035, but by 2040 the coal sharedrops to 32 percent, and the natural gas share increases to 35percent (www.eia.gov/forecasts/aeo/er/early_elecgen.cfm).

Given the changing market dynamics, DOE provided theEIPC an extension to perform additional technical analysis tofurther evaluate gas-electric coordination.

On hand to discuss the Gas-Electric System Interface studyprogress thus far at a meeting last month in Atlanta, Georgia,were the nine various stakeholder groups. The EIPC StakeholderSteering Committee now includes nine key stakeholder sectors:

• States • Canadian provinces • Transmission owners and developers • Generation owners and developers (including at least one

renewable energy generator) • Other suppliers (demand-side resources and distributed gen-

eration) • Non-governmental organizations (including environmental

and land preservation advocates) • Public power and transmission-dependent utilities • End users (including consumer advocates) • Natural gas Participants reviewed draft and final comments on the below

objectives that seek to evaluate the interac-tion between the natural gas and electricsystems. The study has four main objectives(referred to as targets):

1. Baseline the existing natural gas andelectric system infrastructure;

2. Evaluate the capability of the naturalgas system to meet the needs of the electricsystem;

3. Identify contingencies on the naturalgas system that could adversely affect elec-tric system reliability and vice versa; and

4. Review dual-fuel capability.As such, this study assumes three scenar-

ios: adequate supplies of natural gas versusdemand, a lowgas demand scenario and ahigh gas demand scenario all with appliedsensitivities. The EIPC gas-electric studyfocuses on the interaction of the interregion-al transmission systems over the next fiveand 10 years, taking into account all sensi-tivities discussed and applied in one form or

February 2014 Page 33July 2014 Page 33

another using a hydraulic modeling system andthrough state and federal documentation.Ongoing webinars are scheduled throughout2014 with the next face-to-face meeting sched-uled for February 2015.

This process does not seek to displace theexisting Federal Energy RegulatoryCommission Order 890; however, the informa-tion gained should ultimately provide neces-sary data to aid in longer term transmissionexpansion plans.

“The forced outage rate was three timeswhat we assumed. We have to make sure weare able to satisfy demand,” stated an EISPCstakeholder. Present for the natural gas stake-holder group was Erica Bowman, ANGA; DonSantos, INGAA; Joyce Turkaly, PIOGA; andJim Stanzione, National Grid (via phone).

The DOE funding enabled EIPC to performanalysis and planning for the EasternInterconnection in a transparent and collabora-tive manner, open to participation by state and federal officials,representatives from independent system operators (ISOs)and regional transmission organizations (RTOs), utilities, and rel-evant stakeholder bodies or non-government organizations(NGOs), including appropriate entities in Canada, with anapproach to ensure consensus among stakeholders on key issues.

Stakeholders heard study updates from Levitan andAssociates, Inc., a consulting firm retained by the DOE for thisphase of the EIPC study. To assess the perceived stresses, partici-

pants highlight various sensitivities they wish to be tested undervarious scenarios. Levitan will use hydraulic simulation, eco-nomic, and financial models to facilitate the research, goals andobjectives of the study. ■

Richard Levitan (pictured at the front of the room) of Levitan and Associates, Inc.

“PA Independent Oil and Gas Association”

Page 34 The PIOGA Press

RPX Composites

100 BBL - 500 BBL Brine Water Tanks Ladders & Walkways Gun Barrel Separators Double-Wall Tanks for Containment Custom Configurations Well Enclosures & Fiberglass Fabrications Delivery to Your Well Site or Yard Onsite Service

Doug Mohney (814) 743-6194

dmohney@reparex.net www.reparex.net/FRP-tank.html

895 Acorn Road Commodore, PA 15729

Fiberglass tanks are a

corrosion-proof lifetime solution for

your wastewater

handling needs.

By Joyce TurkalyDirector, Natural Gas Market Development

Alternative, clean transportation appears to be gaining sup-port as evidenced during the ACT Expo, held in LongBeach, California. Now in its fourth year, ACT Expo fea-

tures keynote speakers, workshops, ride and drives, an exhibithall displaying the latest in alternative fuel vehicle technology,discussions on the regulatory environment, as well as cost-bene-fit analysis by fleets.

ACT Expo has become something of a broad platform forfuels, vehicles and technologies of all types to be well represent-ed, and for stakeholders in these industries to network. TheAmerican Trucking Associations worked with organizers of theevent for the first time this year; NAFA Fleet Management

Association also played a key organizing role along with theU.S. Department of Energy’s Clean Cities, the U.S. Environ -mental Protection Agency (EPA) and the EPA’s SmartWayTransport Partnership.

The event was organized by ACT Expo management firmGladstein, Neandross & Associates. There were a few field tripevents coordinated with ACT Expo including a heavy-duty natu-ral gas tour with site visits to the Clean Energy station at Port ofLong Beach and the Waste Management Carson station featuringLNG and CNG fueling.

The kickoff keynote speaker during Tuesday’s luncheon wasDennis Slagle, executive vice president group truck sales andmarketing Americas, Volvo Group. The truck manufacturer aimsto be the world leader in sustainable transportation through itsVolvo, Mack, UD, Prevost, Novobus, and other heavy-duty truck

and bus brands. Volvo operates a comprehensivegreen vehicle portfolio in transport, with naturalgas, clean diesel, dimethyl ether (DME) and bi-fuel vehicles. Volvo is working with Cumminson bringing in a 13-liter LNG engine next year.Slagle called for a commonsense regulatoryapproach in Washington, and asked for renewalof expired tax incentives.

Erik Neandross, CEO of event organizerGladstein, Neandross & Associates, led a panelright after Slagle’s presentation featuring promi-nent leaders in the industry. Clean Energy FuelsPresident and CEO Andrew Littlefair gave someinteresting statistics, including heavy-duty trucksusing 25 billion gallons of natural gas last year,taking the lead by far as a user category. Thereare 19 million natural gas vehicles in operation

Shippers driving investment in natural gas transportation segment update

Panelists at the ACT Expo in California.

July 2014 Page 35

globally today, but only 142,000 are in theU.S.

If you consider the overall end-use seg-ments for natural gas, transportation currentlyrepresents a very small piece of the overallpie. This “slice” will grow over time, and Iwas encouraged after listening to the heavy-duty truck panel. I found the panel to be mostinsightful regarding their role in how they willinfluence CNG adoption. Owens Corningstrongly expressed intentions to utilize carrierswith natural-gas-powered equipment. Thecompany intends to work with likemindedshippers to help create lanes to best utilizeequipment and provide miles necessary forfueling infrastructure. Some obstacles to over-come are equipment cost (tank cost), enginesize, tractor weight improvements and shippercollaboration on trip planning. AmericanHonda Motor Company spoke to emissionsreduction goals and altering the company’stransportation strategy where it makes themost sense: from truck to rail and replacingtrucks in the dedicated fleets (parts division)with fuel efficient models; and testingCNG/LNG in California currently. The firstHonda sites outside of California to see natu-ral gas will be Alpharetta, Georgia, and Troy,Ohio. The mass production side of Honda hasalready teamed up with a known CNG station

builder to install natural gas fueling atHonda’s Marysville, Ohio, assembly plants.

All panelists agreed that the growth of NGfleets will be faster if carriers can continue toget incentives for equipment purchases to off-set incremental costs. However, carriers andshippers alike now have skin in the game—they are collaborating by asking, “How canyou help me get my company there?” Carriersthat have made the initial outlay on capital arerealizing longer-term agreements with ship-pers—short term return on ROI and as DavidUncapher, transportation sourcing and opsleader for Owens Corning described it as get-ting to the “aha moment.”

Prompted to ask the audience a questionafter hearing that the U.S. Postal Service—whose spokesman said that they never get ridof their trucks, with an average age of Class8s being 28 years—what’s the most sustain-able country in the world? By measures ofsustainability, Cuba. ■

Page 36 The PIOGA Press

f rom explorat ion to marketReliable Resources...SM

CEC is a reliable resource in the expanding energy industry, delivering integrated engineering, ecological and environmental

Midstream markets.

Civil & Environmental Consultants, Inc.www.cecinc.com | 800-365-2324

E x p e r i e n c eWell sites and impoundments, dams Gathering and transmission pipeline projects Compression, fractionation and other infrastructure facilities

WINNERNortheast

2013

Northeast Oil & Gas AwardsEngineering Company of the Year

Think About Energy briefing

Co-sponsor America’s Natural Gas Alliance tookthe message to the public in three recent forumsheld in Lehigh, the Poconos and Lancaster.

Phenomenal success stories were shared by a panel ofUGI customers at the June 12 meeting in Lancaster. UGIis investing $40 million annually to extend natural gasservice to customers.

If you are a small business, how do you increase com-petitiveness and drive your bottom line?

Pennsylvania’s Shady Maple Market and SmorgasbordRestaurant employs 800 people and draws more than 1.4million customers annually. Thanks to clean natural gas,this business has been able to save more $210,000 (annu-alized) on heating, cooking and hot water costs. CFOGlen Weaver spoke to the switch from propane to naturalgas and encourages other small business owners to do thesame.

Bob Edwards and John Colarusso, representing Penns -ylvania’s Department of Military and Veterans Affairs atFort Indiantown Gap, combined their knowledge andexpertise three years ago to come up with a plan to con-vert this National Guard facility from propane and fueloil to natural gas. Driven by both federal and state conservationand environmental initiatives to address energy efficiencies andclean technology, they are now in the second phase of the four-year project. Efficiencies by switching to natural gas technologyhave provided a demand decrease of 20 percent while achievinga 45-percent cost reduction in total spent as compared to 2010.

Rick Bunn, owner of Advanced Clean Energy Solutions,works with clients from concept to completion on the conversionof fleets from refined fuels to CNG. Rick spoke to the design,construction and operation of CNG of New Holland, LLC, thefirst-fast fill, public CNG Station in Lancaster County. ■

UGI customer panelists (from left): Rick Bunn, Compressed Natural Gasof New Holland; Bob Edwards, PG, CEM, CDSM, energy program spe-cialist, FITG; John Colarusso, CPE, EE, FITG; Glen Weaver, CFO,Shady Maple Market; Richard Stahovich, senior project leader for UGIUtilities, moderator.

PIOGA put this rolling billboard on the streets of Harrisburg inJune in opposition to a severance tax.

July 2014 Page 37

New well permit packageWith the new unconventional well permit fee taking effect

June 14, the Department of Environmental Protection hasposted an updated permit application and instructions on itswebsite.

The material is available at www.elibrary.dep.state.pa.us/dsweb/View/Collection-9806.

The fees for unconventional wells are now $5,000 for non-vertical natural gas wells and $4,200 for vertical natural gaswells. Previously, the fee varied and was based on well borelength. As a result of this change, the permit fee for an aver-age unconventional increases by about $1,800 per non-verti-cal natural gas well and $1,300 per vertical natural gas well.

The fee for conventional wells remains unchanged.

Page 38 The PIOGA Press

ANF legal fees: Continued from page 1

It’s time to try

MAXIMATOR ®

s time to tryService is our

# 1 Priority!

Stocking location in

Fairview PA

Maxpro Technologies814-474-9191

fraciron

www.MaxProTech.com

Hydrostatic Testing

the back burner when in April 2009 the Forest Service—in a“sue and settle” maneuver—reached a settlement in a separatelawsuit brought by three environmental organizations. As a resultof the agreement, which included an unusual clause specificallygranting and acknowledging regulatory authority that it did notpossess, the Forest Service imposed a moratorium on any newdrilling while conducting a forest-wide environmental assess-ment of the impact of oil and gas development. Prior to begin-ning any project, operators then would be required to go throughan expensive, formal and potentially interminable NationalEnvironmental Protection Act (NEPA) environmental assessmentprocess, complete with public comments and appeals.

The agreement spawned the lawsuit Minard Run Oil Co. andPIOGA v. U.S. Forest Service, et al. and resulted in a series offederal district and circuit court rulings strongly supporting theright of operators to develop their private oil and gas rights in thehalf-million-acre national forest and castigating the agency fortrying to impose authority it does not have. In short, the courtsruled that NEPA did not apply and could not be used as a pre-condition to development of private oil and gas estates underly-ing the ANF as development of those estates was not a “federal”action under NEPA. The final ruling came last December whenthe U.S. Court of Appeals for the Third Circuit denied a requestby the Sierra Club and the Allegheny Defense Project to rehearthe case (January Practical Operator, page 17).

The end to the Minard Run case then allowed for resolution ofPennsylvania Oil & Gas Association v. U.S. Forest Service, the2008 lawsuit involving the forest plan. In February, a federal dis-trict court judge dismissed the challenge, saying that the casewas moot as a result of the Minard Run decisions and the fact

that the Forest Service had represented to the court that it wouldobey the Minard Run framework established by the Circuit Courtand had in any event withdrawn the illegal oil and gas changes tothe forest plan (April Practical Operator, page 32). The judge,however, left open the possibility that the industry could renewits challenge if the Forest Service moves away from its represen-tations or acts inconsistent with the framework determined by theMinard Run litigation.

After all that, the relationship between operators and theForest Service has returned to the cooperative process estab-lished in 1980 under the settlement agreement in the originalUnited States v. Minard Run (or Minard Run I) litigation. TheForest Service, with 60 days being the desired timeframe,reviews an operator’s plans for development, negotiates over anychanges forest managers believe are needed to protect surfaceresources and then formalizes any agreements reached. All devel-opment activity also is overseen by the Pennsylvania Departmentof Protection. Notably, the District Court recorded as a finding offact in its 2009 opinion, the “Forest Service concedes…that thecooperative interaction approach of Minard Run I adequatelyprotected the environmental interests of the Forest Service.”

In addition to a check, the ANF legal fund contributors arereceiving a binder and CD that include copies of all opinions andorders in the seven-year litigation as well as a copy of a May 30PIOGA letter to the Forest Service chief addressing some unfin-ished matters and urging him to abide the Minard Run decisions .

“On behalf of PIOGA and on my own behalf I want to thankyou for your financial contributions and your support of our suc-cessful litigation efforts,” Craig Mayer, Esq. PIOGA secretaryand chairman of the ANF legal committee, wrote to contributorsin a letter accompanying the packets. ■

February 2014 Page 39July 2014 Page 39

DIRECTIONAL SURVEY PLUS

Page 40 The PIOGA Press

Natural Gas Futures Closing PricesAs of July 9

Month PriceAugust 2014 4.127September 4.120October 4.115November 4.154December 4.229January 2015 4.292February 4.270March 4.203April 3.945May 3.936June 3.963July 3.992

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 courtesy of Mid American Natural Resources,

manrenergy.com

Oil & Gas Trends

0

10

20

30

40

50

60

70

80

90

Mon

th Jul

Aug

Aug

Aug

Sep

Sep

Oct

Oct

Nov

Nov Dec

Dec

Jan

Jan

Jan

Feb

Mar

Mar

Mar Apr

Apr

May

May Jun

Jun Jul

Previous Year Currrent Year

Pennsylvania Rig Count

February 2014 Page 41July 2014 Page 41

R.L. Laughlin & Co., Inc.“Providing Gas Measurement Services Since 1970”

t Site Automation t Electronic Chart Integration

t Meter Sales t Meter Installations

t Gas Analysis t Calibrations & Repairs

NOW SERVING YOU IN 3 LOCATIONS:

125 State Rt. 43 5012 Washington St., W.

Hartville, OH 44632 Charleston, WV 25313

330-587-1230 304-776-7740

2895 Maysville Pike

Zanesville, OH 43701

740-297-8061

dsteffy@newprospect.comCell: (412) 667-9817

www.newprospect.com

NEW PROSPECT COMPANY

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

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

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

Page 42 The PIOGA Press

PIOGA EventsPIOGA Pig Roast, Equipment Show and Conference

July 22-23, Seven Springs Mountain Resort, ChampionInfo: www.pioga.org/events/category/pioga-events

17th Annual Divot Diggers Golf OutingAugust 15, Tam O'Shanter Golf Club, HermitageInfo: www.ipaa.org/meetings-events/upcoming-meetings

Industry EventsIOGANY Summer Meeting

July 16-17, Peek'n Peak Resort,Findley Lake, NYInfo: www.iogany.org

IOGAWV Summer MeetingAugust 3-5, The Greenbrier, White Sulphur Springs, WVInfo: events.iogawv.com

OOGA Summer MeetingAugust 4-5, Zanesville Country Club, Zanesville, OHInfo: ooga.org/events

WVONGA Fall MeetingSeptember 9-11, Oglebay Resort, Wheeling, WVInfo: www.wvonga.com

Calendar of EventsShale Insight 2014

September 24-25, David Lawrence Conv. Center, PittsburghInfo: www.shaleinsight.com

WV Oil & Gas ExpoOctober 1, Morgantown, WVInfo: www.wvoilandgasexpo.com

Platts 7th Annual Appalachian Oil & GasOctober 16-17, Omni William Penn Hotel, PittsburghInfo: http://www.platts.com/conferencedetail/2014/pc433/index

IOGANY Annual MeetingNovember 11-12, Hyatt Regency, Buffalo, NYInfo: www.iogany.org

IPAA Annual MeetingNovember 12-14, The Breakers, Palm Springs, FLInfo: www.ipaa.org/meetings-events/upcoming-meetings

OOGA Oilfield ExpoDecember 2-4, IX Center, Cleveland, OHInfo: ooga.org/events

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

➤ More events: www.pioga.org

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

CONSOL Energy)Sam Fragale (Vice Chairman), Chief Oil & Gas, 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.Mary Anna Babich, Dawood EngineeringThomas M. Bartos, ABARTA Oil & Gas Company, Inc.Stanley J. Berdell, BLX, Inc.Rob Boulware, Seneca Resources CorporationMike 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, LLCStephen Rupert, Texas Keystone, Inc.Jake Stilley, Patriot Exploration CorporationGary M. Violi, Appalachian Well Services Inc.Burt 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 Oil and Gas Company, Inc.

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.

Membership CommitteeVacant

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)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 Koval (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

© 2014, Pennsylvania Independent Oil & Gas Association

February 2014 Page 43July 2014 Page 43

New PIOGA members — welcome!

Buckeye BOP, LLC9797 Benner Road, Rittman, OH 44270740-498-9898www.buckbop.comService Provider

Clean Air Engineering, Inc.110 Technology Drive, Pittsburgh, PA 15275724-227-0120www.cleanair.comProfessional Firm

Enerplus Resources USA950 17th Street, Suite 2200, Denver, CO 80202-2805720-279-5550www.enerplus.comProducer

Red Oak Energy, LLC252 Martin Road, Clarksburg, PA 15725724-422-7657Producer

Strassburger McKenna Gutnick & GefskyFour Gateway Center, Suite 2200, 444 Liberty Ave., Pittsburgh,PA 15222412-281-5423www.smgglaw.comProfessional Firm

Summit Iron Works6222 Tanoma Road, Indiana, PA 15701330-621-4404www.summitironworks.comService Provider

115 VIP Drive, Suite 210Wexford, PA 15090-7906

Address Service Requested

Associated Resources Inc. | First Place Tower | 15 East 5th Street, Suite 200 | Tulsa, OK 74103 | (918)584-2111

• Direct Access to an Experienced Oil and Gas Workforce - No Training Required

• Service on an “As Needed Basis”. Pay only for the Time and Services Required

• Expand Areas of Capabilities without Adding Employees

• Avoid Expanding and Downsizing Staff with Changing Economic Conditions

• Reduce Management Challenges and Lower Overhead

• Flexibility to Focus More on Core Areas that Generate the Greatest Return on Investment

• Oil and Gas Accounting• Division Order Well Set-up and Maintenance• Joint Interest Billing• Lease Records Set-up, Entry and Maintenance • Accounts Payable and Receivable• Revenue Distribution• Database Compatibility/Conversion and Programming• Title Opinion Curative• Suspense and Escheat • In-House Due Diligence for Buyers and Sellers• Pooling/Integration and Spacing Preparation and

Testimony

Save Time And Money By Putting The Professionals At Associated Resources To Work For You!

Brandon Wardbward@aritulsa.com

Please contact Brandon Ward at(918)236-2663 for more information