Departing DEP secretary says more rules needed for Marcellus Shale
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Departing DEP secretary says more rules needed for Marcellus Shale
By Laura Legere (staff writer)
Published: January 16, 2011
The maximum fines that environmental regulators can issue to violators of the state’s oil and gas law are “way too low,” and the bonds drillers post to guarantee plugging of all their natural gas wells are “scandalously low,” the departing secretary of the Department of Environmental Protection said last week.
State law does not currently give regulators the right to ban gas drilling in floodplains nor has it mandated a large enough distance between gas wells and drinking water reservoirs, Secretary John Hanger said.
And state legislators need to amend sections of the oil and gas law to give regulators clear legal authority to deny permits to drillers that habitually cause significant environmental and safety problems.
“Right now the department really has very questionable authority to tell a company you operate so badly we’re not going to give you any more permits,” he said.
Hanger led the state’s environmental oversight agency during two-and-a-half years when Marcellus Shale drilling grew from an infant industry in Pennsylvania to an established one, and the department under his guidance made substantial updates to the Oil and Gas Act and other environmental laws to respond to that growth.
But in an interview last week with Times-Shamrock newspapers about the past and future of Marcellus Shale oversight, Hanger said many more changes are necessary to ensure proper regulation of the industry, and many of those changes must come from the Legislature.
Despite the prominence of Marcellus Shale drilling as an environmental issue during his tenure, Hanger put it in the context of other environmental threats facing the state, including air pollution from coal-fired power plants, climate change that is contributing to the warming of the state’s rivers and thousands of miles of streams that remain dead from acid mine pollution.
“Marcellus Shale is both an environmental threat and an environmental opportunity,” he said.
The state should tax the industry and use some of the money to clean up legacy environmental problems that otherwise do not receive enough funding, and it should transition to using natural gas in fleet vehicles and power plants, he said.
“The worst case for Pennsylvania would be to be the host of natural gas and not use more natural gas to make electricity and to replace dirty diesel buses and trucks,” he said.
The state also must work to avoid creating future environmental problems from shale drilling by increasing the blanket bond for natural gas wells to make sure they are properly plugged at the end of their lives.
Currently, a $25,000 bond covers as many wells as a company wants to develop. Plugging one Marcellus Shale well costs about four times that much, he said.
“During the Rendell administration, we spent $16 million of taxpayer money to plug 1,600 oil and gas wells that had been abandoned by companies in the past,” he said. “We have these abandoned oil and gas wells with no money to pay for them because we didn’t require the gas companies decades ago to post a reasonable bond.
“We’re in the process of repeating the same mistake.”
Gov.-elect Tom Corbett included increasing well bonds in the environmental position he outlined as a candidate, and State Rep. Phyllis Mundy, D-Kingston, plans to re-introduce legislation to restrict drilling within floodplains and prohibit hydraulically fractured or horizontally drilled wells from being drilled under or within 2,500 feet of a drinking water reservoir.
Hanger also offered advice to Environmental Hearing Board Judge Michael Krancer, who has been nominated for the DEP secretary post.
“The single most important thing” is for the agency to be a “professional, independent watchdog,” he said, and echoed the words Corbett used to describe the appropriate role of the department: a “cop.”
“Sometimes I hear some in the industry and some in business say DEP should be the partner of the gas industry, or should treat the gas industry as a customer or a client,” Hanger said. “That’s not correct. The gas industry companies have partners. They’re called investors.”
If the agency falls short of being an independent, professional watchdog “it doesn’t matter how much staff you have, and it doesn’t matter how tough or weak the words on the rule page are,” he said. “The regulatory role won’t work.”
llegere@timesshamrock.com