More Drilling Help Is Sought
Agency doesn’t have enough money for all current inspectors
Wheeling WV Intelligencer
4 March 2011
By Casey Junkins, Staff Writer
WHEELING - Natural gas companies drilled 58 horizontal Marcellus Shale
wells in West Virginia last year, but state regulators issued permits
for 433 wells in 2010.
West Virginia Sen. Orphy Klempa, D-Ohio, and Randy Huffman, state
Department of Environmental Protection secretary, both know there is
likely more natural gas drilling headed to the Northern Panhandle,
calling for the hiring of more inspectors to oversee the well sites.
"We just have to get more people out there so that we can know what is
going on," Klempa said.
Huffman said his ability to increase inspectors - or maintain the
current number - in the field now hinges on adoption of two bills by
the House of Delegates that were approved by the West Virginia Senate
this week.
"Right now, we are $1.25 million short of even being able to fund our
current staff of 32," Huffman said of all permit handlers and
inspectors working in the Office of Oil and Gas, noting he hopes to
increase the total staff to about 39.
Huffman said the funding shortfall is because there are significantly
fewer conventional vertical gas wells being drilled than there were a
few years ago, while the number of horizontal Marcellus wells has
increased. Right now, drillers pay $650 to drill a well, whether it is
horizontal or vertical.
Gas companies note the new horizontal technology allows them to extract
the same amount of gas from one horizontal well as they would have been
able to gain from several vertical wells.
"This drilling is not out of control. But we realize it is going to
continue to grow, and we are trying to prepare for it," added Huffman.
"All indicators are that we are going to have more drilling over time,
not less."
Huffman said he needs to see both State Senate Bills 424 and 465 to
become law. Both bills passed out of the Senate this week, and are now
under consideration in the House.
Bill 424 is the main bill known as the "Creating Natural Gas Horizontal
Well Control Act," which would increase the horizontal drilling fee
from $650 per well to a rate of $5,000 for the first well
on a drill pad and $1,000 for each additional well on the pad.
The bill would also establish new drilling regulations regarding water
usage.
Huffman said passage of this bill should provide him about $700,000
worth of additional funding each year, far less than if the well fee
would have remained at the original $10,000 per well Huffman
proposed.
Klempa voted for the bill to pass it out of the Senate, but expressed
frustration with not being able to keep the new permit fee at $10,000
per well.
"The gas companies fought like heck to knock down that $10,000 fee," he
said. "They have millions going into a well site and are going to make
millions from a well. I was really surprised how hard
they fought against that $10,000 fee."
Bill 465, commonly known as the "Creating Marcellus Gas and
Manufacturing Development Act," would annually direct $2 million in
severance tax money to the "Marcellus Shale Permit Fund."
Huffman said this money will help him run the Office of Oil and Gas.
"If all these things pass in their current forms, we should be all
right," Huffman said. "I am not about to predict what the Legislature
is going to do, but it looks pretty good right now."
Huffman said the horizontal wells are much larger construction projects
than are the conventional vertical wells. This work includes building
roads, drilling wells, adding tubing and cement to
the wells, and large water withdrawals for hydraulic fracturing, or
fracking.
"There are many more citizen complaints to investigate, and are just a
lot more things to address with the horizontal wells," he said.
Tim Greene, owner of Land and Mineral Management of Appalachia, said
the DEP probably needs more inspectors, but could also help the
Northern Panhandle by directing more resources to it.
"I really think the DEP is doing the best they can," he said. "They put
their efforts to inspecting active drilling sites."