American Oil and Gas Reporter - March 2019 - 102

ConventionCoverage: Independent Oil and Gas Association of West Virginia

Pro-Industry Bills Likely
In West Virginia
By Dan Holder
CHARLESTON, W.V.-The Independent
Oil and Gas Association of West Virginia
held its winter meeting two weeks after
state legislators opened their 2019 session,
and association President Brett Loflin said
conventional well operators could expect
some good news out of the statehouse.
Revising marginal well exemptions,
incentivizing natural gas production
during cold weather and changing well
spacing requirements were among those
measures, Loflin, vice president of regulatory affairs at Northeast Natural Energy
LLC in Morgantown, W.V., reported in
opening the general meeting on Jan. 23,
held at Charleston's Marriott Town Center
Hotel.
IOGAWV supports raising the production threshold for exempting marginal
wells from severance taxes from 5 Mcf a
day or half a barrel of oil to 60 Mcf/d or
10 bbl/d, he described. Loflin added one
proposed bill would divert some of the
previously paid tax monies toward an orphan well fund to pay for plugging operations across the state.
Legislators also are considering a bill
to incentivize drilling or workovers in

places classified as distressed gas areas.
Loflin said those incentives would cover
regions where local distribution companies had run into deliverability issues of
natural gas during periods of extreme
cold weather. "I don't know if it will be
enough, but IOGAWV is looking at a
five-year moratorium on severance taxes
for those wells and a cap on gathering
rates," he reported.
State rules on well spacing have not
been fully revised since 1972, Loflin indicated, and the 3,000-foot spacing limits
are a poor fit for the unconventional Utica
Shale play and other deep horizontal
wells. He added IOGAWV and the West
Virginia Oil & Gas Conservation Commission had been discussing how best to
update the rules, noting the best remedy
might come through the legislative process.
"IOGAWV also continues to monitor
issues concerning the Aboveground Storage Tank Act," he said. "If there are inconsistencies with inspections between
agencies, let us know you are having issues. The association is in constant contact
with the Department of Environmental
Protection, and the Producers Issues Committee has been talking to the agency
about detection methods. We have been

Lori Miller-Smith, office manager and meeting planner for the Independent Oil and Gas
Association of West Virginia, addresses the association's winter meeting after being
honored for her work. Helping with the recognition are Mike McCown (left), co-chairman
of IOGAWV's Communications & Education Committee, and IOGAWV Executive Director
Charlie Burd (right).

102 THE AMERICAN OIL & GAS REPORTER

pretty successful in convincing agency
staff that the leak protection method used
on smaller tanks that fall under the act
works, and that they should accept those
methods."
IOGAWV also has proposed changes
to the water quality certification process,
he said, submitting comments on rules
covering stream and wetland crossings.
DEP now considers every crossing a separate project, and as long as construction
impacts 300 linear feet or less, there is
no requirement for a mitigation process
or mitigation bank funds, he said.
"DEP is proposing to aggregate all of
those crossings, so if they totaled 300
linear feet or more, you are going to fall
under that mitigation requirement. That
is pretty huge. As it stands right now,
DEP has taken that provision out. I think
that was a direct result of the association's
contact with DEP," Loflin reported.
The association also has been in discussions with the West Virginia Division
of Highways on the revised road use
policy it issued in 2018, he said. Under
the revisions, trucks involved in well
plugging operations now must post bonds
to use secondary roads. Loflin related
IOGAWV was pushing the division to
adjust the policy.
Regional Report
In his roundup of industry activity
across the Appalachian Basin, Timothy
Knobloch, president of James Knobloch
Petroleum Consultants Inc., assessed that
while the region's future was somewhat
hazy, overall it still looked very good. In
West Virginia, Knobloch said 13 counties
represented about 70 percent of the wells,
80 percent of the gas production and 70
percent of the oil output.
There are 22,000 wells in the basin
right now, including all permitted and
producing wells, Knobloch said, with
those in Northeast Pennsylvania, southwestern Pennsylvania and northern West
Virginia mostly focused on the Marcellus
Shale. The Utica Shale activity is concentrated in southeastern Ohio, but he
pointed out some Pennsylvania and West
Virginia operators were starting to target



American Oil and Gas Reporter - March 2019

Table of Contents for the Digital Edition of American Oil and Gas Reporter - March 2019

Contents
American Oil and Gas Reporter - March 2019 - Intro
American Oil and Gas Reporter - March 2019 - 1
American Oil and Gas Reporter - March 2019 - 2
American Oil and Gas Reporter - March 2019 - 3
American Oil and Gas Reporter - March 2019 - 4
American Oil and Gas Reporter - March 2019 - Contents
American Oil and Gas Reporter - March 2019 - 6
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