Committees Consider Marcellus Shale Documents
Policy, law deal with drilling, effect on roads
Morgantown Dominion
Post
16 November 2010
By David Beard
CHARLESTON — Two legislative committees took their first looks at draft
documents regulating Marcellus gas drilling.
A joint Judiciary subcommittee received a 98-page draft law to regulate
gas well construction, horizontal drilling and fracking.
The joint Infrastructure committee received a draft Oil and Gas Roads
Policy from the Division of Highways (DOH).
The drafts are intended for review, discussion and revision.
Drilling regulations
The proposed bill covers “pooling and unitization” of wells to protect
property owner interests along with water and land protections to
ensure “the orderly development of this new drilling activity.”
As part of the permit application, the DOH must approve
well road access. No later than the application filing date, the
applicant must inform all property owners of its intentions.
“Notwithstanding trade secret claims,” the bill reads,
well operators must provide a complete list of the chemicals and
compounds used in their fracking fluid. The operator must also maintain
and report data on the volume of fluids used and returned to the
surface.
David McMahon, spokesman for the Surface Owners’ Rights
Organization, explained the advantages of pooling and unitization. A
pool is a single natural reservoir of gas, and pooling is drilling
multiple horizontal wells from a centralized well pad.
Unitization means an underground well system that covers
more than one surface owner’s property. In unitization, a mineral owner
could “force” his way into a drilling unit if he can show his resource
would be drained by a neighboring unit. A mineral owner could also be
forced into a unit if he doesn’t want to join but his property lies
between units, or he wants to join but wants better terms.
“If done properly with proper protections, forced
horizontal drilling can be a good thing,” McMahon said.
Delegate Mike Ross, D-Randolph, wanted to know if the
proposed bill would increase the number of inspectors. Told yes, he
suggested the state look at allowing current inspectors to work
overtime as an alternative to hiring more.
It would save additional pension, vehicle and uniform
costs, he said. Facing possible budget cuts, “these are things that the
state should be looking at. Overtime is probably the cheapest money you
can pay.”
Gas roads policy
The DOH already has a policy on road use by the timber, oil and gas
industries. State Highway Engineer Marvin Murphy reviewed proposed
changes to account for Marcellus gas traffic, with the many
water-hauling trucks employed.
The problem in these cases, he said, isn’t so much the
weight of the vehicles but the repetition — the stress of many vehicles
going back and forth each day.
For “large” wells — 5,000-plus barrels of liquid — the
operator must give notice of its proposed drilling site. The DOH will
meet with the operator and review the current condition of the road.
They will agree on improvements to be made before, during and after the
project. A bond will be required.
Smaller projects will have different rules, depending on
the length — up to or more than 45 days.
Bonds will vary by road type and project duration. For a
large operation, a graveled mile would be $25,000; tar and chip,
$35,000; paved, $100,000. For smaller projects, the bonds would be
$10,000, $15,000 and $25,000 respectively.
Corky DeMarco, representing the West Virginia Oil and Gas
Association, agreed that the traffic volume, not the weight, is the
issue. He said his organization has been working closely with the DOH
to finetune this policy.
“We’re going to get there, and we’re going to get there
with the Department of Highways,” he said, using the DOH’s old name.
Attorney Ann Bradley, representing the Independent Oil and
Gas Association, listed three points still needing clarification:
- Distinguishing the highway impact of all commercial
vehicles, so as not to unfairly target one industry.
- Noting that Marcellus traffic is more destructive than
conventional gas drilling traffic.
- Bonding — small operators with 10-15 miles of gas well
sites may find the proposed bond levels too high and be forced out of
business.
Murphy noted one more point that needs work: How to
determine the share of the costs if more than one company uses the
road.
Both committees will revisit the proposed documents at the
December interims.