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PA Bulletin, Doc. No. 22-1138

THE GOVERNOR

GOVERNOR'S OFFICE

[52 Pa.B. 4229]
[Saturday, July 30, 2022]

Notice of Bill Enacted without Signature

July 19, 2022

 Pursuant to Article IV, Section 15 of the Pennsylvania Constitution, I have allowed House Bill 2644, Printer's Number 3644 to become law without my signature. While I am allowing this legislation to become enacted, I write to record my concerns with both the substance of the legislation and how it will be administered. This legislation was the product of a divided government, in which compromise between differing viewpoints is necessary.

 As this bill advanced through the legislative process, my administration raised concerns about the structure of the Oil and Gas Well Plugging Grant Program established in Subchapter C of the bill. First, the bill directs that federal Infrastructure Investment and Jobs Act (IIJA) funding be deposited in the Orphan Well Plugging Fund; however, IIJA funds are not dispersed to states, they are administered by the Department of Interior. Second, the legislation requires the payment of grants of either $10,000 or $20,000 per well based on the depth of the well, without reference to the actual cost of plugging the well. Third, the legislation eliminates the Department of Environmental Protection's (DEP) authority to impose requirements on recipients of federal funding that are stricter than the requirements under State law, even if those more stringent requirements are mandatory parts of the federal program. Unfortunately, these concerns were not addressed through the legislative process, and there are concerns that significant provisions of the bill are neither applicable to the program nor capable of being implemented.

 Finally, the legislature's action to withdraw the Environmental Quality Board's authority to establish bonding amounts for the conventional industry provides an appropriate occasion to revisit whether the Commonwealth is doing enough to ensure that this industry is being a good environmental steward by preventing the abandonment of wells and meeting its obligations as a prudent trustee of Pennsylvania's public natural resources for current and future generations.

 Evidence on this count is discouraging. Over the past five years, DEP has identified more than 17,000 violations at conventional oil and gas wells, and DEP has issued over 3,300 Notices of Violations to the conventional industry specifically due to attempts to abandon wells since July 1, 2017. In addition, over the past five years, operators of conventional oil and gas wells have failed to report production for an average of around 36,000 conventional oil and gas wells per year.

 Due to these concerns, DEP is reviewing existing processes and procedures and will be providing the following evaluations and recommendations to me by September 1st:

 1) Evaluation of the conventional industry's recent record of compliance with reporting requirements and performance requirements under existing law.

 2) Evaluation of using existing authority, including increased exercise of civil penalty authority and forfeiting conventional oil and gas well bonds and requiring submission of replacement bonds, as methods to deter and motivate conventional operators to address abandoned wells and violations of the applicable law.

 3) Recommendations for increased scrutiny of conventional oil and gas operators' requests for regulatory inactive status approval and permit transfers, because these steps are often precursors to improper abandonment of wells.

 4) Evaluation of using existing criminal provisions related to conventional oil and gas operations as a means of deterring and motivating conventional operators to address abandoned wells and violations of the applicable law.

 5) Recommendations for regulatory reform to comprehensively regulate conventional drilling according to modern best practices and industry standards.

 Sincerely,

  

 Governor

[Pa.B. Doc. No. 22-1138. Filed for public inspection July 29, 2022, 9:00 a.m.]


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