Gas Drillers: New Road-Repair Rules Too Expensive
Associated Press
12 August 2010
MORGANTOWN, W.Va. -- West Virginia Transportation Secretary Paul Mattox
wants natural gas drilling companies to anticipate and pay for the wear
and tear they're causing West Virginia's country roads, many of which
have "more or less evolved from a mere wagon trail."
At least one industry official, though, complains that the new rules --
issued in an Aug. 4 memo and reaching gas companies this week -- are
vague, unreasonable and potentially too expensive for some to bear.
"These go well above and beyond what is necessary to safeguard roadways
in the state, and we are assessing our response," said Charlie Burd,
executive director of the Independent Oil and Gas Association of West
Virginia.
Gas companies have no choice but to rely on rural roads as they rush to
tap the rich Marcellus shale reserves, but residents are frustrated by
the increased volume of traffic and damage, Mattox wrote, and so are
county road crews, whose budgets are geared toward regular maintenance,
not major repairs and construction.
His memo requires gas project planners to meet with local highway
supervisors and agree on various obligations for widening, paving and
drainage -- before, during and after a drilling job.
Companies would have to post road-repair bonds ranging from $50,000 to
$100,000 per mile, depending on whether the road is topped with gravel,
tar and chip, or pavement. Those amounts could increase if bridges are
in the agreed-upon truck routes.
"Let's say you were 10 miles off the main highway to a well site.
That's a million-dollar bond. The bond's more than three times as much
as the well," Burd said. "This has the potential of being catastrophic
in nature to conventional wells, and it could be very harmful to
Marcellus wells."
Burd also complained that the rules are unclear about things such as
who must purchase right of way, who's responsible for the physical
completion of the work and whether that work must comply with state
purchasing laws if it's done by the gas companies.
Marcellus shale underlies Ohio, West Virginia, Pennsylvania and New
York, and drilling is in high gear in Pennsylvania and Northern West
Virginia. The gas is locked in tightly compacted rock a mile
underground, and freeing it requires unconventional horizontal drilling
technologies and vast amounts of water.
That means traffic in the form of trucks carrying large equipment and
water on roads not built to withstand the weight or damage.
The Pennsylvania Department of Transportation also is considering
whether to increase bond limits for its roads.
The current requirements -- $6,000 per mile for an unpaved road,
$12,500 per mile for a hard-surface road -- do not protect taxpayers,
given the far-higher cost of repairing roads today, said Elam Herr, the
assistant executive director of the Pennsylvania State Association of
Township Supervisors.
Despite the many reports of damaged roads, Herr said, many municipal
officials say gas companies are generally working diligently to ensure
roads are fixed and passable.
When drilling first started in remote Wetzel County, retiree Ray Renaud
put a time-lapse camera in his window and counted as many as 50 trucks
an hour passing his home near New Martinsville. Chesapeake Energy has
responded well to complaints, he said, providing warning trucks and
repairing one damaged road last fall. By spring, however, traffic had
again destroyed the road.
"I moved here for the serenity of the country. Fifty trucks an hour and
living in an industrial zone is not serenity," said Renaud, an
emergency medical technician who also worries about safety and
accidents.
In 2003, lawmakers approved legislation that allowed overweight coal
trucks to travel on designated routes in Southern West Virginia.
Hauling companies were required to buy permits, with the money used to
maintain the roads and bridges along the routes.
The Department of Transportation realized it needed a similar system to
address the growing needs of the gas industry, said DOT spokesman Brent
Walker.
Many drilling companies are fine, responsible operators, he said, and
the new rules are a response to "a few irresponsible companies kind of
making it harder on the rest of the industry."
Corky DeMarco, executive director of the West Virginia Oil and Gas
Association, acknowledged his industry also has to address the concerns
of citizens and state officials.
Although gas industry leaders had been attending informal talks about
roads in meetings hosted by a handful of state legislators, DeMarco
said they did sit down with Mattox or the DOT to craft the rules they
were given.
Although many details have to be worked out, he said, companies are
"generally open and receptive" to Mattox's requirements. Bonding, for
example, could become "an accounting nightmare" for some companies.
The upside of the DOT plan, however, is that everyone will understand
what's expected before a project begins.
"This is like the old Fram oil filter commercial: You either pay me now
or pay me later," DeMarco said. "We're going to be paying one way or
another. What's going to cost us less in the long run? I think working
with the highways department and doing the plan beforehand."