Pittsburgh, PA – The Pennsylvania Department of Environmental Protection (DEP) executed a consent assessment of civil penalty (CACP) with Range Resources – Appalachia, LLC (Range Resources), an oil and gas operator that owns conventional wells, on Thursday, January 7, 2021, in the amount of $294,000 for violations of the 2012 Oil and Gas Act (Oil and Gas Act) regarding wells ineligible for inactive status listed on its inactive status request to DEP. DEP received Range Resources’ CACP payment on Friday, January 8, 2021.
“It’s the law: inactive wells need to be viable for future use. If wells are not viable for future use, then they should be classified as abandoned wells and are required to be plugged,” said DEP Secretary Patrick McDonnell. “DEP is committed to ensuring the safety and health of all Pennsylvanians and will continue to enforce violations of the commonwealth’s environmental protection laws.”
The Oil and Gas Act mandates that wells must satisfy several criteria to be granted inactive status, including being viable for future use within five years. If wells are not viable for future use then they are ineligible for inactive status, and after 12 consecutive months of no production, the well would be classified as abandoned and must be plugged.
Range Resources applied for inactive status on Friday, September 29, 2017, for its Shirocky No. 1 (Shirocky) well, located in Fayette County, indicating that it intended to return the well to production at a future date.
However, Range Resources concurrently included its interoffice communication with its inactive status well application that stated its Shirocky well had no viable future use despite conflicting information in its inactive status application. Therefore, the Shirocky well was ineligible for inactive well status because it had no viable future use and should have never been listed on the request. It should have been classified as abandoned and subsequently plugged.
Unplugged abandoned wells can be an extreme hazard to the health and safety of people and the environment. Leaking wells can contribute to air, water, and soil contamination.
Pennsylvania’s oil and gas fields are riddled with about 200,000 to 560,000 abandoned wells representing a legacy of a century of largely unregulated oil and gas development.
After receiving Range Resources’ interoffice communication that conflicted with its Shirocky inactive status application, DEP issued a subpoena to Range Resources for information related to other wells that Range Resources had requested inactive status. The information developed based on Range Resources’ response to the subpoena indicated that between Tuesday, July 16, 2013, and Monday, October 11, 2017, 42 of Range Resources’ conventional wells were placed on inactive status but were never used again. Some of the wells had not been in use for 12 months at the time Range Resources submitted its applications for inactive status.
Range Resources used the inactive status period to delay the eventual plugging of unproductive wells without returning them to active status. A well granted inactive status is required to be plugged, or returned to active status, within five years of the date inactive status was granted. Operators can apply for an extension of inactive status.
Range Resources should have classified the wells with no viable future use as abandoned and plugged them. Similar to the Shirocky well, these wells were ineligible for inactive status and should have never been included in the requests.
DEP issued a notice of violation to Range Resources regarding the Shirocky well. Additional violations were addressed with the operator leading up to the CACP.
Range Resources plugged its wells with no viable future use, which DEP confirmed. Following this action, DEP assessed Range Resources a civil penalty of $294,000. DEP received Range Resources’ CACP payment on Friday, January 8, 2021. The plugging and payment satisfied the conditions of the CACP.
DEP deposited the money received from the CACP into an account for DEP’s Well Plugging Program and will use this money to plug orphan wells that have no responsible operator and that pose risks to public safety and the environment.
“Assuring operators plug idle wells addresses liabilities now, instead of leaving them for future generations,” said McDonnell.