Ohio Oil and Gas Association P.O. Box 535, Granville, Ohio 43023-0535 Phone: 740-587-0444 – Fax: 740-587-0446 Visit us online at www.ooga.org Return Service Requested your oil field TruCK HeAdQuArTerS Specifications for use in ohio WATER TRUCKS Call 1-866-332-3172 for more information 2013 PETERBILT 367 Allstate Peterbilt Allstate Peterbilt Allstate Peterbilt /Ford of Cleveland of New Philapelphia of Youngstown 8650 Brookpark Road 327 Stone Creek Rd. NW 3680 LeHarps Road Brooklyn, OH New Philadelphia, OH Youngstown, OH www.allstatepeterbilt.com SERVICE HOURS: SERVICE HOURS: SERVICE HOURS: 16 Midwest Locations to Serve You M-F: 7:30 am - Midnight M-F: 7:30 am - 8:00 pm M-F: 7:00 am - Midnight Volume 62, Number 5, July/August 2012 Bulletin Ohio Oil and Gas Association Visit us online at www.ooga.org Legal Action Update Recent Decision on Patriot Water Strengthens ODNR’s “Sole and Exclusive” Authority By: Brian Hickman he recent legal battle between Patriot Water Tand the Ohio Environmental Protection “(T)he bill acknowledges the well-established Agency (Ohio EPA) has resulted in an appeal rule that one administrative agency may not, decision that strengthens the Ohio Department of Natural Resources (ODNR) “sole and unless otherwise provided for by statute, exclusive” authority under Ohio Revised Code enforce the rules and regulations of another,” Section 1509.02. noted the ERAC opinion. Under the Strickland administration in 2010, Patriot Water (Patriot) was granted a permit to install (PTI) by the Ohio EPA to treat brine did not observe “chronic mortality rates” and only permitted Patriot to stemming from oil and gas operations. The dispose of 100,000 gallons per day with a Total Dissolved Solids (TDS) Patriot facility, located near the city of Warren concentration of 50,000 parts per million (ppm). in Trumbull County, then sent the treated water The first question is the heart of the legal battle between Patriot and to the Warren Wastewater Treatment Plant Ohio EPA. In 2012, Ohio EPA issued a new NPDES permit to WWTP. (WWTP) for final disposal into the Mahoning In it, a new section was added prohibiting the plant from accepting brine River. To do this, the treatment plant needed from oil and gas operations “unless and until it is approved by the Chief to modify their National Pollutant Discharge of the Division of Oil and Gas Resources Management”. This language Elimination System (NPDES) permit to accept was added because Ohio EPA believed the previous permit violated the treated water from Patriot. Ohio Revised Code (ORC) Section 1509.22, noting that ODNR has Two questions were at issue regarding the initial the authority to regulate the disposal of brine. Additionally, according NPDES permit. First, did Ohio EPA (via the to Ohio EPA, since Patriot’s facility was not using “new technology” as NPDES permitting program) or ODNR (via describe within, Patriot could not dispose of water until its technology Ohio Revised Code Section 1509.22 on brine was approved by the ODNR. disposal) regulate this activity? Secondly, does Both Patriot and WWTP filed appeals to ERAC on this change to their Patriot’s activity impact water quality? previously accepted permit. Their appeal was centered around whether On the second question, Patriot voluntarily Ohio EPA Director Scott Nally had the authority to bar brine disposal agreed to do a pilot study on water quality under his regulatory authority and not ODNR’s regulatory authority. and toxicity. The study would determine how On July 3rd, a decision by the Environmental Review Appeals much brine would begin to cause the death Commission (ERAC) was made that could allow the Patriot Water of certain indicator species in the river. The Treatment Plant to continue to operate. ERAC determined that a section study found that Patriot could safely discharge of the 2012 NPDES permit barred WWTP from accepting brine and 664,000 gallons of brine per day. This was based must be struck. The decision stated Ohio EPA only has authority under upon the mortality rate of water fleas that was Chapter 6111, not 1509.22. In their decision, they note that language determined based on the study. Ohio EPA, regarding ODNR’s “sole and exclusive” regulatory authority (as changed however, modified the findings as the study Please see page 6 Senate Bill 315 Provisions Become Law on Sept. 10 - page 9 President’s Comments national group to protect their livelihood; and an impressive group of fighters had come together to help them do just that. Like the residents of the Colorado Springs area, our industry too is fighting our own fire of sorts. It is a fire of regulations that is being fraught upon us by government. When it comes to the number of regulatory and tax proposals being made across the producing states and on a national level, it is clear that we need all the help we can get. Like those fighting the Colorado fires, oil and gas producers, organizations, investors, corporations, etc. from all over the country need to work together to fight these regulations. Many of our members belong to several good trade associa- tions and for good reasons. For example, members of the Ohio Oil and Gas Association belong to IPAA because we need national representation as well as the opportunity to Jerry James network with other state oil and gas associations to address OOGA President the onslaught of government regulatory and tax propos- als. Hydraulic fracturing, for instance, has been reviled in the press even though it has long been regulated at the state level and has been proven safe in over 1,000,000 treatments! he wildfires were raging June 27-29, 2012 in Colorado As a result, the federal government is now looking to see Springs while The Independent Petroleum Association T how they can regulate. Over a dozen agencies of the federal of America’s (IPAA) mid-year meeting took place. In a safety government alone are looking at regulatory issues for our update letter to IPAA members on the organization’s website, industry. In McDermott, Will and Emery’s Energy Business Barry Russell, President and CEO of IPAA told members Law blog of April 30, 2012, Brandon H. Barnes and James that the U.S. Forest Service had confirmed 450 firefighters, A. Pardo posted the following regarding the federal gov- three heavy air tankers, four Single Engine Air Tankers, one ernment’s attempt to issue unnecessary regulations on our lead plane and two helicopters were tackling the blaze and industry: that more people would be arriving the following day to help. A Type 1 National Team, described as the Navy Seals of firefighting, had arrived in Colorado Springs, according to “President Obama’s position that hydraulic fracturing must be the U.S. Forest Service, and the team had taken command. conducted in a “safe and responsible” manner has been inter- The IPAA donated money to the fire fighters and others who preted as suggesting the need for increased federal regulation of had come in from all over the United States to assist. It was fracing. Indeed, various federal agencies have stepped forward obvious that the fires were more than the locals could handle with proposed regulations targeting air emissions, chemical on their own and that they needed the assistance of a larger Please see page 17 Page 2 Ohio Oil & Gas Association Bulletin – www.ooga.org July/August 2012 Ohio Oil & Gas Association Contents 2011-2012 Committee Chairs Federal Policy Review Commerce (Co-Chairs) Steve Downey How Oil and Gas is Regulated Under the Safe Drinking Water Act 7 [email protected] 304-343-5505 U.S. EPA Trying to Expand Enforcement Powers to Inspect Connie Slocum [email protected] 614-307-9180 Fracing at Well Sites 13 Environmental Gregory Russell State Policy Review [email protected] 614-464-5468 Recent Decision on Patriot Water Strengthens ODNR’s “Sole Exploration and Exclusive” Authority 1 John Forman [email protected] 614-440-6465 ODNR Crafts New Drilling Permit Requirements 4 Government Affairs Gov. Kasich Bans, Oil, Gas Epxloration Within and Under Lake Erie 5 Jim Aslanides New Rules on UIC Program Now Effective Due to Emergency [email protected] 740-622-5600 Executive Order 8 PAC (Oil & Producers Fund) Subcommittee Thomas Booth Senate Bill 315 Provisions Become Law on Sept. 10 9 [email protected] 330-833-5558 Court Rules PA Can’t Restrict Local Governments From Using Legal W. Jonathan Airey Zoning Law to Regulate Oil, Gas 14 [email protected] 614-464-6346 Reports & Editorials Tax Subcommittee Thomas Giusti President’s Comments 2 [email protected] 614-825-0011 Ohio Map of Utica Shale Activity 12 Meetings OOGEEP 53 - 55 Joel Rudicil [email protected] 330-659-0095 OOGA Member News Membership Gregory Mason IPAA Partners with RegScan to Create Environmental [email protected] 740-622-1844 Compliance System 10 Producers (Co-Chairs) Explorer Foundation Corporate Members 17 Clint Cameron 740-453-3300 Press Releases 22 Duane Clark In Memorium 23-24 [email protected] 330-757-8886 Past Presidents Council Bulletin Advertisers 25 Jeffrey J.A. Baker New OOGA Members 26 - 47 [email protected] 614-898-7590 Safety Article 49 Safety (Co-Chairs) Crude Oil and Natural Gas Prices (NYMEX) 56, 58 Steven Miller [email protected] Bill Murray Events [email protected] 330-244-9607 2012 OOGA Annual Summer Meeting Sponsors 18 - 19 2012 OOGA Oilfield Expo 20 Contact Your Association OOGEEP Events 52 OOGA Events 51 Ohio Oil & Gas Association Industry Events 51 1718 Columbus Rd., S.W. (St. Rt. 16) P.O. Box 535, Granville, Ohio 43023-0535 Phone: 740-587-0444 Fax: 740-587-0446 Visit us online at www.ooga.org July/August 2012 Ohio Oil & Gas Association Bulletin – www.ooga.org Page 3 Ohio Department of Natural Resources ODNR Crafts New Drilling Permit Requirements By: Brian Hickman temming from recent changes to the Ohio - Identify the water sources utilized in the completion SAdministrative Code (OAC) and the Ohio Revised operation Code (ORC), the Ohio Department of Natural Resources - Submit a copy of the Road Use and Maintenance Division of Oil and Gas Resources Management (DOGRM) Agreement (RUMA) or “best efforts” affidavit if no RUMA has revised their drilling permit application.