Action | Expanding disclosure of ingredients used in well stimulation & completion & reviewing best practices |
Stage | Proposed |
Comment Period | Ended on 12/4/2015 |
MEMORANDUM
TO: Michael Skiffington
Regulatory Coordinator
FROM: Eric A. Gregory
County Attorney
DATE: December 2, 2015
RE: King George County Board of Supervisors’ Public comments concerning DMME’s Proposed Gas and Oil Regulation
Please accept the following comments submitted on behalf of the King George County Board of Supervisors:
Comment concerning DMME Proposed Gas and Oil Regulation
The King George County Board of Supervisors supports DMME's Proposed Virginia Gas and Oil Regulation (4 VAC 25-150) published on September 23, 2015, as an improvement upon the present regulation; however, the regulation must recognize and incorporate further amendments as submitted herein to better address public safety and environmental concerns. The King George County Board of Supervisors reiterates and affirms its comments submitted in response to DMME’s Notice of Intended Regulatory Action and notes that the regulation does not satisfactorily incorporate or address those comments. To that extent, the DMME should revisit those comments and take appropriate action to further amend the regulation in accordance therewith.
The Proposed Regulation seeks to ensure gas and oil regulation reflects current industry best practices; to expand disclosure of ingredients used in gas and oil well stimulation and completion on permitted and future gas and oil operations in the Commonwealth; and, to determine if current regulatory requirements are sufficient to properly regulate drilling in different geographical areas of the Commonwealth. In its analysis of the proposed Gas and Oil Regulation, the Virginia Department of Planning and Budget recognized that the benefits of the proposed changes likely exceed the costs.
Although the Proposed Regulation improves upon the presently applicable regulation in these important areas, the proposed regulation (1) fails to address or provide for potential impacts upon water quality and quantity concerns in the Eastern Virginia Groundwater Management Area; (2) fails to appropriately recognize the authority and role of local governments in exercising land use and zoning authority; (3) fails to recognize and properly memorialize the authority of the Virginia Department of Environmental Quality in the regulation and oversight of state waters, tributaries, and groundwater; and, (4) fails to provide for adequate financial assurance to provide for compliance with The Virginia Gas and Oil Act, specifically §§ 45.1-361.31 and 45.1-361.32 of the Code of Virginia.
The King George County Board of Supervisors submits these comments for the following reasons and may supplement these comments in the future:
In 2015, the General Assembly passed legislation (see Chapter 613 of the Virginia Acts of Assembly) establishing the Eastern Virginia Groundwater Management Advisory Committee to examine concerns associated with the present and long term sustainability of the EVGMA. Specifically the Advisory Committee will examine (i) options for developing long-term alternative water sources, (ii) issues concerning water demand, (iii) sustainable ground water management, (iv) future groundwater permitting criteria, and other policies and procedures to enhance the effectiveness of ground water management in the EVGMA.
Given the issues driving the formation of the Advisory Committee, the challenges associated with present and long-term management of, and the sensitivity of ground water resources within the EVGMA, and recognizing the large amounts of water necessary to conduct gas and oil drilling activities, particularly those associated with hydraulic fracturing, the Gas and Oil Regulation should be amended to address and mitigate impacts upon ground water resources within the EVGMA. Further study is necessary to better understand the Potomac Aquifer and its hydrology before informed decisions can be made concerning its management, particularly with regard to potentially significant withdrawals and other impacts from industrial oil and gas mining and hydraulic fracturing activities.
At minimum, the regulation should require the disclosure of water sources utilized for drilling and hydraulic fracturing activities and the proper treatment and disposition of waste or produced water from those activities so that waste or produced water does not impact the already fragile EVGMA. Such disclosures should include an analysis of impacts upon ground water, the Potomac Aquifer, and other affected users.
The Gas and Oil Regulation should explicitly recognize and respect local government authority and more appropriately involve local governments in the permitting and regulatory enforcement process. For instance, instead of merely notifying the local government of an application for a permit to conduct gas and oil drilling activities in the jurisdiction, the local government should be invited to actively participate in the permit application and review process. If a permit is issued, there should be a mechanism by which local governments may notify DMME of a permittee’s violation of a local ordinance or a provision of the Gas and Oil Act or Regulation. This mechanism must hold permittees accountable for compliance with local ordinances.
Recognizing that the Memorandum of Agreement sets forth a positive framework for inter-agency cooperation in the regulation of gas and oil drilling in Tidewater Virginia, but that the Agreement is subject to alteration, amendment, or rescission at any time, it is imperative that its provisions be made more resilient and therefore, the Gas and Oil Regulation should be amended to incorporate the provisions of the Agreement.
Given the real and potential impact of abandoned gas or oil wells, the potential negligence associated therewith, and the costs associated with mitigation of environmental impacts, bonding and financial securing requirements should be increased, with particular regard to those required for gas or oil wells permitted in Tidewater Virginia to address potential costly ground and surface water impacts. Present bonding requirements are inadequate and should be expanded to address and provide for potential costs incurred by local governments in dealing with abandoned wells.
This proposal is reasonable and well justified, particularly when considering the Virginia Department of Planning and Budget’s Economic Impact Analysis and its conclusion that the benefits of DMME’s proposed regulation likely exceed the costs and that additional reporting costs on regulated operators are expected to be small. Given the minimal impacts of expanding the Gas and Oil Regulation, increasing bonding and financial security provisions should not have a negative impact upon the industry.
[1] Sediment Distribution and Hydrologic Conditions of the Potomac Aquifer in Virginia and Parts of Maryland and North Carolina, Scientific Investigations Report 2013-5116, U.S. Department of the Interior, U.S. Geological Survey, prepared in cooperation with the Virginia Department of Environmental Quality, E. Randy McFarland (2013).