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PADEP Proposal Would Limit Liability for Using Mine Influenced Water in Fracking Process

RJ Lee Group News

February 1, 2013

Acid mine drainage contains iron pyrite which oxidizes when exposed to air and water creating rust.

Based on a recommendation by Pennsylvania Governor Corbett’s Marcellus Shale Advisory Commission, the state’s Department of Environmental Protection (PADEP) published a white paper in January detailing how the agency intends to review proposals from Oil & Gas drillers on use of Mine Influenced Water (MIW) for drilling operations. MIW includes either water contained in a mine pool or a surface discharge of water caused by mining activities and is also known as mine drainage water (MDW), acid mine drainage (AMD) or acid rock drainage (ARD). According to the PADEP, over 300 million gallons of mine-polluted water flow into the state’s rivers and streams every day, resulting in more than 4,000 miles of biologically dead rivers and streams . Last year, drillers in the U.S. used 40 billion gallons of fresh water to frack (equivalent to half of the MIW generated each year), and Pennsylvania is the second largest user of fresh water for fracking.

Currently, operators considering the use of MIW for natural gas extraction activities have the potential to incur long-term liability because just the act of moving contaminated water necessitates total responsibility for it in the future. If there is any chance that this water could impact fresh water, operators would have to treat it, no matter how much time has passed. And so, drilling companies have been slow in taking up this challenge for fear of having to assume full liability for treatment when they need only temporary use of the water.

To encourage drillers to use MIW in their fracking process, Pennsylvania state environmental regulators are offering two options to limit long-term liability under current law and policy. A proposed project could be structured either to fit within the Environmental Good Samaritan Act, which provides broad civil liability protection but is not intended to shield those already responsible for treatment and clean-up of MIW (or held liable for other reasons), or by creating a Consent Order and Agreement (CO&A). The CO&A would theoretically limit the user’s liability to the state by excusing the operator from long-term treatment of the MIW source – so long as specific conditions are met. These conditions either would require new permitting, or might involve modification of existing well permits and Water Management Plans and would also include sampling and characterization of the water. If these conditions were left unresolved, legal risk would significantly increase.

The PADEP has already developed lists of major mine discharges in the state and is encouraging operators to consider using these sources before identifying freshwater withdrawals.

The rusting drainage is highly acidic and enters waterways polluting streams and killing aquatic life.

Proposals to use MIW must also include details about how the water will be transported, stored and used. The storage criteria include demonstrating that using the MIW will not result in water pollution. Operators must establish that the quality of the MIW being stored prior to use does not exceed maximum concentration standards for storage as defined in Appendix A of the white paper. If no data on the water quality of the MIW source is available, operators must conduct sampling of the MIW at prospective sites and provide sampling data to the PADEP as part of its proposal to use MIW for natural gas extraction. If the MIW is stored in a nonjurisdictional impoundment periodic testing would also be required to ensure that the MIW being used continues to meet the specified parameters. Other storage mechanisms that include centralized impoundment, storage in pits and tanks at the well site, and polishing ponds or aerobic wetlands at existing treatment facilities would not be subject to the testing requirements.

Natural deep waters are already contaminated with respect to potable water. The U.S. Department of Energy’s Subcommittee on Shale Gas Production shares the prevailing view that “the risk of fracturing fluid leakage into drinking water sources through fractures made in deep shale reservoirs is remote. As long as care is taken to properly drill and seal wells, there should be no significant environmental impact from using MIW for the fracking.” Environmental advocates have been pushing for using polluted water in drilling operations for more than two years. The MIW proposal appears to have earned support across the board from stakeholders that include both the oil and gas industry and environmental organizations. Radisav D. Vidic, University of Pittsburgh professor and one of the biggest backers of using polluted water for fracking fluid thinks “it is great that the DEP is moving in that direction,” while Matt Pitzarella, Range Resources spokesman, feels that “anything that makes water sourcing more accessible and in a manner that allows us to continue to improve the environment is a good step forward.” Organizer for the Western Pennsylvania Coalition for Abandoned Mine-Reclamation, Andy McAllister, notes that the gas industry is not used to working with the environmental movement, but he thinks this is a win-win situation and he’s hoping to get the gas industry to provide MIW clean-up funds in perpetuity. PA DEP Secretary Mike Krancer sums up, “This initiative, which combines remediating abandoned mine water with responsible extraction of our natural gas resources, is a win for our environment and our economy.

Note: Since the publication of the white paper and awareness of its contents through internet and news articles, more environmentalists and oil and gas producers have expressed their support for the proposition. In a February 4, 2013 “Letter to the Editor” in a southwestern Pennsylvania newspaper, Ed Reese, Vice President of Lancaster-based engineering consulting firm RETTEW Associates, Inc. stated that “The newly released guidance from the Department of Environmental Protection removes previous regulatory hurdles for natural gas operators as they incorporate a beneficial reuse of AMD.”

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