The West Virginia Legislature today passed landmark legislation to regulate horizontal oil and gas wells. Although the bill technically addresses horizontal wells in general, the purpose of the legislation is to address the oncoming growth of oil and gas development in the Marcellus shale in West Virginia.
The bill represents a significant victory for both Governor Earl Ray Tomblin, whose compromise legislation easily passed both the House of Delegates and the Senate with only minor amendments and will become law upon his signature, and the leadership of both houses of the Legislature, which managed to pass significant legislation in this short special session.
The new law will provide:
- Increased permit fees to fund the regulatory efforts of the West Virginia Department of Environmental Protection (WVDEP)
- Increased well location restrictions to protect water resources and surface uses
- A requirement that a road use agreement be in place prior to permit issuance
- Increased notice provisions and a new compensation statute for surface owners
- Increased enforcement authority for the WVDEP - including increased potential civil penalties for violations of the law
- The codification of water use and wastewater handling regulations contained largely in the Governor?s emergency rule
There are also provisions for the WVDEP to promulgate further legislative rules in the near term regarding air quality and cementing and casing issues.
Passage of the bill culminates a three-year process for the Legislature, which has been wrestling with how to address the regulatory challenges presented by Marcellus shale. While it is clear neither industry nor environmental advocates are totally pleased with the passage of this bill, it is a substantial first step in the regulation of the Marcellus shale and provides some level of regulatory certainty needed for industry.