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Megan E. Smith, Esq. Buchanan Ingersoll & Rooney PC August 1, 2013

Pipeline Planning, Permitting, Construction and Operation: Introduction to the Regulatory Scheme Affecting Production and Midstream Operations in Pennsylvania. Megan E. Smith, Esq. Buchanan Ingersoll & Rooney PC August 1, 2013. Topics to be covered.

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Megan E. Smith, Esq. Buchanan Ingersoll & Rooney PC August 1, 2013

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  1. Pipeline Planning, Permitting, Construction and Operation: Introduction to the Regulatory Scheme Affecting Production and Midstream Operations in Pennsylvania Megan E. Smith, Esq. Buchanan Ingersoll & Rooney PC August 1, 2013
  2. Topics to be covered Overview of regulatory programs impacting upstream and midstream natural gas operations in Pennsylvania Pennsylvania Natural Diversity Index (“PNDI”) Recent Federal air regulations impacting natural gas industry development planning
  3. Pennsylvania Regulatory Overview Primary Sources of Regulation: 58 Pa. Con. Stat. § 2301 et seq. (“Act 13”) 25 Pa. Code Ch. 78 Other major sources: Solid Waste Management Act, 35 Pa. Stat. § 6018.101 et seq. Clean Streams Law, 35 Pa. Stat. § 691.1 et seq. Air Pollution Control Act, 35 Pa. Stat. § 4006.1 et seq. PADEP would also identify the Land Recycling and Remediation Act, 35 Pa. Stat. §§6026.101-6026.909 (“Act 2”)
  4. PNDI - Background Pennsylvania Natural Diversity Index (PNDI) Developed to assist PADEP in assessing/addressing potential impacts to Threatened & Endangered (T&E) Species Clearances required for virtually any permit/any construction project in Pennsylvania Database managed by Pennsylvania Department of Conservation of Natural Resources (DCNR)
  5. PNDI - Authority Identified authority for PNDI: Federal Statutes: Endangered Species Act of 1973 16 U.S.C. §§ 1531 et seq. Regulations: 50 CFR § 17.11 (Endangered and threatened wildlife) 50 CFR § 17.12 (Endangered and threatened plants) 50 CFR § 17.95 (Critical Habitat - fish and wildlife) 50 CFR Part 222 (General endangered and threatened species) 50 CFR Part 226 (Designated critical habitat) 50 CFR Part 402 (Interagency Cooperation) 50 CFR Part 424 (Listing endangered and threatened species and designating critical habitat)
  6. PNDI – Authority (Cont’d) State Statutes: Wild Resources Conservation Act (administered by DCNR) 32 P.S. §§ 5301 et seq. (Plants) (Section 5307 – Wild Plant Management) Fish and Boat Code (administered by the PFBC) 30 Pa. C.S.A. §§ 101 et seq. (Fish, amphibians, reptiles and aquatic organisms) (Section 102 – Definitions and Section 2305 Threatened and Endangered Species) Game and Wildlife Code (administered by the PGC) 34 Pa. C.S.A. §§ 101 et seq. (Birds and mammals) (Section 102 – Definitions and Section 2167 Endangered or Threatened Species) 2012 Oil and Gas Act, 58 Pa.C.S. 3201-3274 (administered by DEP) 58 Pa.C.S. § 3215 (Well Location Restrictions) Regulations: DCNR 17 Pa. Code Chapter 45 – Conservation of Pennsylvania Native Wild Plants (Plants) PFBC58 Pa. Code Chapter 75 – Endangered and Threatened Species (Fish, amphibians, reptiles and aquatic organisms) PGC 58 Pa. Code Chapter 133 – Wildlife Classification (Birds and mammals)
  7. PNDI – Authority (Cont’d) DEP Mineral Resources 25 Pa. Code § 77.126 (Criteria for permit approval or denial) 25 Pa. Code § 78.15 (Application Requirements) 25 Pa. Code § 86.37 (Criteria for permit approval or denial) 25 Pa. Code § 86.101 (Definitions) 25 Pa. Code § 86.102 (Areas where mining is prohibited or limited) 25 Pa. Code § 86.122 (Criteria for designing lands as unsuitable, fragile lands) 25 Pa. Code § 86.129 (Coal exploration on areas designated as unsuitable for mining) 25 Pa. Code §§ 87.50, 88.33, 89.74 and 90.18 (Fish and wildlife resource information.) 25 Pa. Code §§ 87.159, 88.133 and 88.221 (Postmining land use.) 25 Pa. Code §§ 87.138, 89.65, 89.82 and 90.150 (Protection of fish, wildlife and environmental values.) 25 Pa. Code § 87.84, 88.62 (Fish and wildlife protection and enhance plant plans.) 25 Pa. Code § 90.202 (General requirements.) (Siting coal refuse disposal site.)
  8. PNDI – Authority (Cont’d) Waste Management, Environmental Cleanup and Brownfields 25 Pa. Code § 236.128 (Natural Resources.) 25 Pa. Code § 245.235 (Environmental assessment.) 25 Pa. Code § 250.1 (Definitions.) 25 Pa. Code § 250.311 (Evaluation of ecological receptors.) 25 Pa. Code §269.a.50 (Environmental assessment considerations.) 25 Pa. Code §§ 271.127, 287.127 (Environmental assessment.) 25 Pa. Code §§ 271.127, 273.202, 275.202, 277.202, 279.202, 281.202, 283.202, 284.220, 284.320, 285.134, 287.127, 287.661-662, 288.202, 288.422, 288.522, 288.622, 289.422, 289.522, 293.202, 295.202, 297.202, 299.144, 299.153 and 299.158 (relating to siting criteria) 25 Pa. Code § 271.915 (Management practices.) (Sewage sludge.) 25 Pa. Code § 291.201 (General provisions.) (Land application of residual waste.)
  9. PNDI – Authority (Cont’d) Water Resources 25 Pa. Code § 71.21 (Content of official plans.) 25 Pa. Code § 92a.12 (Treatment requirements.) 25 Pa. Code § 93.4c (Implementation of antidegradation requirements.) 25 Pa. Code § 102.6 (Permit applications and fees.) 25 Pa. Code § 105.16 (Environmental, social and economic balancing.) 25 Pa. Code § 105.17 (Wetlands.) 25 Pa. Code § 105.381 (Location of dredging.) 25 Pa. Code § 105.401 (Permit applications.)
  10. PNDI - Agencies Pennsylvania Agencies United States Fish and Wildlife Service (USFWS) Department of Conservation of Natural Resources (DCNR) Pennsylvania Game Commission (PGC) Pennsylvania Fish and Boat Commission (PFBC)
  11. PNDI – Online Tool DCNR manages online PNDI tool which was built by the Pennsylvania Natural Heritage Program (PNHP)http://www.gis.dcnr.state.pa.us/hgis-er/Login.aspx
  12. PNDI - Status PADEP PNDI Policy PNDI clearance duration – Extended from one to two years Online PNDI tool expanded from two to ten miles New DEP PNDI policy will be concurrent, instead of sequential, permit & PNDI reviews
  13. PNDI – Status (Cont’d) Remaining Concerns – Transparency of species data Like playing “battleship” Accountability in governance process
  14. PNDI –Current Process Flow Chart
  15. PNDI – Search Receipts Lack Transparency Typical PNDI Receipt Species information unknown Must send information into agencies listed and wait for a response.
  16. PNDI – Final Thoughts Economic Community Needs To establish a uniform and transparent process for evaluating, designating and protecting T&E species and their critical habitats in PA NOT just an O&G industry issue Impacts anyone proposing to construct any type of facility in Pennsylvania
  17. Air Regulations – NSPS OOOO New Source Performance Standards, 40 CFR § 60.5375(a) Rule for “affected gas wells” (with certain exceptions) as of 1/1/15: (1) For the duration of flowback, route the recovered liquids into one or more storage vessels or re-inject the recovered liquids into the well or another well, and route the recovered gas into a gas flow line or collection system, re-inject the recovered gas into the well or another well, use the recovered gas as an on-site fuel source, or use the recovered gas for another useful purpose that a purchased fuel or raw material would serve, with no direct release to the atmosphere. If this is infeasible, follow the requirements in paragraph (a)(3) of this section. (2) All salable quality gas must be routed to the gas flow line as soon as practicable. In cases where flowback emissions cannot be directed to the flow line, you must follow the requirements in paragraph (a)(3) of this section.
  18. NSPS OOOO (Cont’d) (3) You must capture and direct flowback emissions to a completion combustion device, except in conditions that may result in a fire hazard or explosion, or where high heat emissions from a completion combustion device may negatively impact tundra, permafrost or waterways. Completion combustion devices must be equipped with a reliable continuous ignition source over the duration of flowback. (4) You have a general duty to safely maximize resource recovery and minimize releases to the atmosphere during flowback and subsequent recovery.
  19. NSPS OOOO (Cont’d) Generally assumes a pipeline is available at or shortly after a well is hydraulically fractured Not necessarily so – midstream infrastructure may lag behind Bottom line: Likely will require a shift in the way that pipeline planning occurs to ensure pipeline availability/capacity
  20. Megan E. Smith, Esq. Buchanan Ingersoll & Rooney PC One Oxford Centre 301 Grant Street, 20th Floor Pittsburgh, PA 15219 Telephone: 412-392-1626 E-mail: megan.smith@bipc.com
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