Review and Approval of Projects, 8095-8100 [2012-2504]
Download as PDF
<![CDATA[
Federal Register / Vol. 77, No. 30 / Tuesday, February 14, 2012 / Rules and Regulations
matters the impact any such rule would
have on competition. The Commission
does not believe that the amendments
that the Commission is adopting today
will have any impact on competition.
Statutory Authority: The amendments to
the Commission’s rules are adopted pursuant
to 15 U.S.C. 77s, 78d, 78d–1, 78d–2, 78w,
78mm, 80a–37, 80b–11, and 7202; 5 U.S.C.
App. (Inspector General Act of 1978) § 8G;
and § 989B of Pub. L. 111–203 (2010).
PART 200—ORGANIZATION;
CONDUCT AND ETHICS; AND
INFORMATION AND REQUESTS
Subpart A—Organization and Program
Management
1. The authority citation for Part 200,
Subpart A, is amended by adding the
following citation, in numerical order,
to read as follows:
■
Authority: 15 U.S.C. 77o, 77s, 77sss, 78d,
78d–1, 78d–2, 78w, 78ll(d), 78mm, 80a–37,
80b–11, and 7202, unless otherwise noted.
Section 200.16a is also issued under Sec.
989B of Pub. L. 111–203 (2010), 124 Stat.
1376; and 5 U.S.C. App. (Inspector General
Act of 1978) Sec. 8G.
*
*
2. § 200.16a is amended by removing
the word ‘‘Chairman’’ and adding in its
place the word ‘‘Commission’’ in
paragraphs (b) and (c) wherever it
appears.
■
Dated: February 8, 2012.
By the Commission.
Elizabeth M. Murphy,
Secretary.
[FR Doc. 2012–3312 Filed 2–13–12; 8:45 am]
BILLING CODE 8011–01–P
Kimberly D. Bose,
Secretary.
[Docket No. RM11–30–000; Order No. 756]
[FR Doc. 2012–3317 Filed 2–13–12; 8:45 am]
BILLING CODE 6717–01–P
Technical Corrections to Commission
Regulations
This document adds sections
that were inadvertently removed from
the Final Rule that the Federal Energy
Regulatory Commission published in
the Federal Register on February 1,
2012. The Final Rule revised a number
of references in Commission regulations
that had become outdated for various
reasons or contain typographical errors.
The changes contained in this
amendment add or delete language in
current Commission regulations by
eliminating obsolete information and
correcting clerical mistakes. The
revisions are intended to be ministerial
and/or informational in nature.
DATES: Effective date: February 14, 2012.
FOR FURTHER INFORMATION CONTACT:
Kenneth Yu, Office of the General
Counsel, Federal Energy Regulatory
Commission, 888 First Street NE.,
Washington, DC 20426, (202) 502–8482.
SUPPLEMENTARY INFORMATION: This
document corrects a document
published in the Federal Register on
February 1, 2012 (77 FR 4891), in which
sections that were inadvertently
removed.
SUMMARY:
In accordance with the preamble, the
Commission hereby amends Title 17,
Chapter II of the Code of Federal
Regulations as follows:
*
18 CFR Part 2
Federal Energy Regulatory
Commission, DOE.
ACTION: Final rule: correcting
amendment.
Text of Amendments
*
Federal Energy Regulatory
Commission
AGENCY:
Administrative practice and
procedure, Authority delegations
(Government agencies), Organization
and functions (Government agencies).
List of Subjects in 18 CFR Part 2
Administrative practice and
procedure, Electric power, Natural gas,
Pipelines, Reporting and recordkeeping
requirements.
Therefore, 18 CFR part 2 is amended
by the following correcting
amendments:
PART 2—GENERAL POLICY AND
INTERPRETATIONS
1. The authority citation for part 2
continues to read as follows:
pmangrum on DSK3VPTVN1PROD with RULES
■
Authority: 5 U.S.C. 601; 15 U.S.C. 717–
717z, 3301–3432; 16 U.S.C. 792–828c, 2601–
2645; 42 U.S.C. 4321–4370h, 7101–7352.
§ 2.13
[Removed]
2. Remove the first paragraph (b) in
§ 2.13 including the footnote.
■
VerDate Mar<15>2010
14:25 Feb 13, 2012
Jkt 226001
[Corrected]
3. In § 2.55(a)(2)(iii), revise the phrase
‘‘On and at the same time as’’ to read
‘‘On, or at the same time as,’’.
■
Issued February 8, 2012.
List of Subjects in 17 CFR Part 200
*
§ 2.55
DEPARTMENT OF ENERGY
8095
PO 00000
Frm 00007
Fmt 4700
Sfmt 4700
SUSQUEHANNA RIVER BASIN
COMMISSION
18 CFR Part 806
Review and Approval of Projects
Susquehanna River Basin
Commission.
ACTION: Final rule.
AGENCY:
This document contains final
rules that would amend the project
review regulations of the Susquehanna
River Basin Commission (Commission)
to include definitions for new terms and
an amended definition; provide for
administrative approval of interbasin
transfers of flowback and production
fluids between drilling pad sites that are
isolated from the waters of the basin;
provide for administrative approval of
out-of-basin transfers of flowback or
produced fluids from a Commission
approved hydrocarbon development
project to an out-of-basin treatment or
disposal facility; insert language
authorizing renewal of expiring
approvals, including Approvals by Rule
(ABRs); delete specific references to
geologic formations that may be the
subject of natural gas development
using hydrofracture stimulation and
replace with a generic category—
‘‘unconventional natural gas
development;’’ broaden the scope of
ABRs issued to include hydrocarbon
development of any kind utilizing the
waters of the basin, not just
unconventional natural gas well
development; memorialize the current
practice of requiring post-hydrofracture
reporting; and provide further
procedures for the approval of water
sources utilized at projects subject to the
ABR process.
DATES: Effective April 1, 2012.
ADDRESSES: Susquehanna River Basin
Commission, 1721 North Front Street,
Harrisburg, PA 17102–2391.
FOR FURTHER INFORMATION CONTACT:
Richard A. Cairo, General Counsel,
telephone: 717–238–0423, ext. 306; fax:
717–238–2436; email: rcairo@srbc.net.
Also, for further information on the
proposed rulemaking, visit the
Commission’s Web site at www.srbc.net.
SUPPLEMENTARY INFORMATION:
SUMMARY:
E:\FR\FM\14FER1.SGM
14FER1
8096
Federal Register / Vol. 77, No. 30 / Tuesday, February 14, 2012 / Rules and Regulations
Comments and Responses to Proposed
Rulemaking
Notice of proposed rulemaking was
published in the Federal Register on
July 13, 2011; the New York Register on
July 27, 2011; the Pennsylvania Bulletin
on July 23, 2011; and the Maryland
Register on July 29, 2011. The
Commission convened public hearings
on August 2, 2011, in Harrisburg,
Pennsylvania and on August 4, 2011, in
Binghamton, New York. Public
information meetings were also held on
October 25, 2011 in Williamsport,
Pennsylvania, and on October 27, 2011,
in Camp Hill, Pennsylvania. The
original 60-day comment period first
established on June 23, 2011, was
extended until November 10, 2011,
pursuant to an action taken by the
Commission on September 15, 2011.
Comments on the proposed rulemaking
were received at both the hearings and
during the comment period. The
comments can be divided into two
categories: (1) General Comments—
These comments are not directed to
specific language of the proposed
rulemaking, but rather address
perceived environmental and policy
impacts; and (2) Comments by Section—
These comments are directed at the
specific language of the proposed
rulemaking, often offering further
revisions to this language. A summary
of both categories of comments and the
Commission’s responses thereto follows.
pmangrum on DSK3VPTVN1PROD with RULES
General Comments
Comment: The Commission should
more clearly explain the scientific basis
for the proposed rulemaking. Also, the
Commission should conduct a full life
cycle cumulative impact study of the
basinwide impacts of unconventional
natural gas extraction prior to issuing
this rulemaking.
Response: The proposed rulemaking
is administrative in nature and involves
no substantive change in the review
standards applied to projects. Therefore,
the basis of the rulemaking does not
involve the analysis, evaluation or reevaluation of scientific principals. On
the whole, it is an attempt to codify
within the rules certain definitions,
existing practices and policies, and to
establish certain procedures related to
implementation of the Commission’s
regulatory authority.
Comment: The more extensive use of
the Approval by Rule (ABR) process in
this proposed rulemaking will weaken
the Commission’s regulatory oversight
and will simply make it easier for gas
well developers using hydrofracture
stimulation methods to withdraw the
waters of the basin.
VerDate Mar<15>2010
14:25 Feb 13, 2012
Jkt 226001
Response: The Commission believes
that this comment indicates a basic
misunderstanding of the scope of the
ABR process and the fact that all
withdrawal projects will continue to be
docketed and acted on by the full
Commission. Through the docketing
process, the Commission actively
manages the use of the basin’s waters
and mitigates impacts on surface and
ground waters through appropriate
conditions limiting use. The ABR
process then provides an efficient
monitoring system for waters that are
consumptively used. The Commission
applies the same approval standards to
all approvals, no matter the form they
take. It exercises continuing jurisdiction
and oversight to ensure compliance, and
can reopen approvals and issue new
orders or conditions if warranted.
Comment: Use of the ABR process to
oversee the interbasin transfer of
flowback and produced fluids and for
the out of basin diversion of such fluids
for treatment poses a danger to the
waters of the basin due to its toxic
content and the potential for spillage.
The ABR process also bypasses the
usual analysis given to proposed
diversions of water.
Response: The proposed rules simply
formalize practices that are already in
place for the transfer of such fluids.
These procedures will provide a net
benefit to the basin by encouraging the
use and reuse of lesser quality water
instead of unimpaired water from
streams or ground water sources.
Furthermore, unlike the typical
diversion of water out of the basin
where the consumptive loss occurs and
is evaluated in the context of the
proposed diversion activity, the
consumptive loss in this situation is
considered to have occurred at the time
of the initial withdrawal from the
system, before its first use within the
basin and prior to being diverted out of
the basin. For into-basin diversions, the
existing standards are focused on
limiting any introduction of
contaminated sources into the waters of
the basin. The final rulemaking, as
structured, provides that same standard.
What it changes is the form of the
approval, not the standard that should
be applied.
Comment: The Commission places too
much reliance on allegedly inadequate
state water quality laws relating to
wastewater disposal and residual waste.
For example, the Commission cannot
rely on such state laws and regulations
to isolate from the waters of the basin
the flowback and production fluids
whose interbasin transfer the
Commission proposes to approve
administratively. Therefore, it is
PO 00000
Frm 00008
Fmt 4700
Sfmt 4700
incumbent on the Commission to invoke
its own water quality regulatory
authority and ensure that wastewater is
indeed handled in a manner that
isolates it from the waters of the basin.
Response: The Susquehanna River
Basin Compact, Public Law 91–575,
Section 5.2(b) gives specific emphasis to
the primary role of the states in water
quality management and control.
Member states are already exercising or
preparing to exercise their water quality
authority with respect to gas drilling
activity and are also strengthening their
laws and regulations. At this stage, there
appears to be no justification for the
Commission to assume water quality
jurisdiction. As noted in response to a
comment below, the Commission is
taking steps to replace the term ‘‘isolate
from the waters of the basin’’ with
language that references the standards
and requirements of member
jurisdictions.
Comment: The Commission’s refusal
to promulgate water quality regulations
relating to gas well development will
allow the non-uniform treatment of
water users throughout the basin and
therefore not conform to the purposes of
the Susquehanna River Basin Compact.
Response: The compact purpose of
‘‘uniform treatment of water users’’ does
not require that the Commission
exclusively regulate all aspects of water
resources in the basin. If state
regulations and standards are
compatible with the Commission’s
Comprehensive Plan and do an
adequate job of fulfilling the purposes of
the plan, the Commission will not
attempt to duplicate those regulations
and standards. Where it does act, it does
so in a manner that provides for uniform
treatment of all water users.
Comment: The expanded use of the
ABR process lessens the opportunity for
public input and scrutiny on project
approvals.
Response: The Commission disagrees.
The ABR applications must be noticed
by applicants and there is an
opportunity for interested citizens to
comment on these applications before
an approval is issued. ABRs are also
subject to the same approval standards
as docketed approvals, and may be
reopened and modified by the Executive
Director should unforeseen problems
arise. Furthermore, notice of issuance of
an ABR is published in the Federal
Register and any such approval is
subject to appeal pursuant to § 808.2.
Comment: The Commission should
not be extending the scope of the ABR
program to include other forms of
hydrocarbon development without first
determining if the ABR program is
E:\FR\FM\14FER1.SGM
14FER1
Federal Register / Vol. 77, No. 30 / Tuesday, February 14, 2012 / Rules and Regulations
suitable for these other forms of
development.
Response: The ABR process has
proven to be a valuable tool for
monitoring consumptive use related
activity on pad sites. This rulemaking,
which as noted above is administrative
in nature, would extend the use of this
valuable tracking tool to other forms of
hydrocarbon development. Water
withdrawals by any water user,
including that undertaken for use in
other forms of hydrocarbon
development, will still undergo the full
docket approval process, and be subject
to all applicable Commission standards
and requirements.
Comment: The Commission is a
federal agency under the Susquehanna
River Basin Compact and is subject to
the National Environmental Policy Act
(NEPA). It must therefore complete all
NEPA requirements in connection with
this proposed rulemaking action.
Response: The Commission
categorically rejects any suggestion that
it is subject to NEPA. This is consistent
with the position the Commission has
taken on NEPA since the 1980s. Instead
of a federal agency, the Commission is
a federal-interstate compact agency
representing all four of its member
jurisdictions. The federal government is
only one voting member of the
Commission and any action of the
Commission requires the vote of a
majority of the members. Therefore, the
actions of the Commission are not the
actions of the federal government, but
the joint actions of the member
jurisdictions. Also, Congress has
specifically exempted the Commission
from the provisions of the federal
Administrative Procedures Act (APA).
Federal court decisions have taken a
consistent view, namely that agencies
not subject to the APA are not federal
agencies in the conventional sense and
are therefore not subject to NEPA or
similar laws imposing requirements on
‘‘federal agencies.’’
Comments by Section, Part 806
pmangrum on DSK3VPTVN1PROD with RULES
Section 806.3—Definitions
Comment: The 30-day rule in the
proposed definition of flowback means
that fluid produced from the well bore
from the 31st day until the well is
placed in production is neither
flowback or production fluid within the
definition (unless the well is placed into
production during the initial 30-day
period).
Response: Agreed. The proposed
definition is modified to remove the 30day reference and to make clear that
return flow recovered post-
VerDate Mar<15>2010
14:25 Feb 13, 2012
Jkt 226001
hydrofracture and pre-production is
defined as flowback.
Comment: The word ‘‘siting’’ in the
definitions of ‘‘hydrocarbon
development’’ and ‘‘unconventional
natural gas development’’ is
inconsistent with the ‘‘initiation of
construction’’ standard in the
Commission’s project review
regulations. The regulations specify the
‘‘spudding of the well’’ to be the
initiation of a well project.
Response: Agreed. The word ‘‘siting’’
is deleted from this definition to avoid
the inconsistency.
Comment: The definition of ‘‘project’’
does not make clear that
‘‘unconventional natural gas
development’’ is a subset of
‘‘hydrocarbon development activity.’’
Response: Language is inserted in the
definition to clarify that the term is a
sub-category of hydrocarbon
development.
Comment: Several comments
expressed disagreement with the
proposed definition of ‘‘tophole water,’’
with one suggesting use of
Pennsylvania’s definition instead and
another claiming that the definition is
too vague.
Response: The tophole water
definition is replaced with a modified
version of the Pennsylvania definition.
The modification, notably removing the
reference to surface water, makes it
generally consistent with New York’s
interpretation of the term and allows for
more basinwide consistency.
Section 806.4—Projects Requiring
Review and Approval
Paragraphs 806.4(a)(3)(v) & (vi)
Comment: The phrase ‘‘in such
manner as to isolate it from the waters
of the basin’’ is too vague and should be
replaced with a reference to the actual
controls exercised by the member states.
Also, because the industry may mix the
waters of the basin withdrawn from
surface and ground water sources with
flowback or production fluids in
preparation for hydrofracture use, it is
not possible to isolate it from the waters
of the basin if read strictly.
Response: The ‘‘isolate’’ terminology
is replaced with ‘‘provided it is
handled, transported and stored in
compliance with all standards and
requirements of the applicable member
jurisdictions.’’ The same language has
also been inserted in Paragraph
806.4(a)(3)(vi), which similarly
addresses diversions of flowback or
production fluids, and is substituted in
Paragraph 806.22(f)(11)(iii) for the same
reason.
Comment: There is no clear
requirement that project sponsors keep
PO 00000
Frm 00009
Fmt 4700
Sfmt 4700
8097
track of interbasin transfers of flowback
and production fluids.
Response: Language is added to
paragraphs 806.4(a)(3)(v) and (vi)
reinforcing the requirement that all
monitoring and reporting requirements
applicable to the pad site ABR must be
met. Similar language is added to
paragraph 806.22(f)(11) to meet the
same concerns about tracking.
Paragraph 806.4(3)(vi)
Comment: The use of the phrase ‘‘the
same’’ implies that each tank load of
flowback or production fluid would
require separate approval.
Response: The language is replaced
with ‘‘flowback or production fluids’’ to
remove any uncertainty.
Section 806.13—Submission of
Application
Comment: The phrase ‘‘Project
sponsors of projects subject to review
and approval’’ should properly be
changed to read ‘‘Sponsors of projects
subject to review and approval.’’
Response: Agreed. The suggested
change is incorporated into the final
rulemaking.
Section 806.14—Contents of
Application
Paragraph 806.14(a)
Comment: With respect to renewal
applications, there is no clear indication
that they will be made subject to any
approval standards.
Response: To remove any ambiguity,
and to further clarify the original intent
concerning renewal standards, the
phrase ‘‘shall be subject to the standards
set forth in Subpart C—Standards for
Review and Approval of this Part’’ is
added to this paragraph.
Section 806.15—Notice of Application
Paragraph 806.15(e)
Comment: The requirement for a
newspaper notice in areas where a
wastewater discharge source is to be
used is unworkable where such water is
mixed with other water sources at the
initial destination and is then
redistributed, oftentimes to other
locations not contemplated at the time
notice is given.
Response: The word ‘‘initially’’ is
added before the phrase ‘‘used for
natural gas development’’ to limit this
requirement to the initial location(s)
where this water is contemplated for use
at the time of application.
E:\FR\FM\14FER1.SGM
14FER1
8098
Federal Register / Vol. 77, No. 30 / Tuesday, February 14, 2012 / Rules and Regulations
Section 806.22—Standards for
Consumptive Use of Water
Paragraph 806.22(f)(10)
Comment: Extension of ABR approval
terms to 15 years will essentially lessen
or weaken the oversight that the
Commission exercises over gas drilling
activities.
Response: Though the Commission
feels that there is a fundamental
misunderstanding by some who
commented about the ongoing oversight
that it exercises over approved projects,
and the ability of the Commission to
reopen approvals, it is willing to retain
the current approval term with the
addition of procedures for renewal of
ABRs. Therefore, the proposed change is
removed from the final rulemaking.
Paragraph 806.22(f)(11)
Comment: Need to make clear that
this paragraph applies to the use of
sources in addition to those sources
approved for use by the project sponsor
pursuant to § 806.4.
Response: Wording is added to the
beginning of this paragraph to make the
suggested clarification.
pmangrum on DSK3VPTVN1PROD with RULES
Paragraph 806.22(f)(11)(i), (ii), and (iv)
Comment: Tophole water,
precipitation and storm water collected
on the pad site or water obtained from
a hydrocarbon storage facility can be
contaminated, so there is a need to
appropriately limit its use.
Response: Language is added limiting
the use of this water to drilling or
hydrofracture stimulation only, or in the
case of paragraph 806.22(f)(11)(iv),
limiting the use to that provided for in
the approval.
Paragraph 806.22(f)(11)(iii)
Comment: As defined, flowback and
production fluids do not cover all fluids
encountered in the drilling process that
serve as a water source under current
practice. For example, water can be
recovered from drilling muds. Also,
such fluids can be recovered from
production well sites, in addition to
drilling pad sites or hydrocarbon water
storage facilities. Current Commission
policy allows for the reuse of such
fluids.
Response: Drilling fluids and
formation fluids are added to this
paragraph to cover all fluids recovered
during the drilling process and used
under current practice for hydrofracture
stimulation. The term ‘‘production well
site’’ is also added to clarify the sites
from which such fluids can be
recovered. The word ‘‘only’’ is also
added to this paragraph to make clear
that these fluids may only be used for
VerDate Mar<15>2010
14:25 Feb 13, 2012
Jkt 226001
hydrofracture stimulation. Language is
also added clarifying that all such fluids
must be handled, transported and stored
in compliance with all standards and
requirements of the applicable member
jurisdiction.
Paragraph 806.22(f)(14)
Comment: The provisions of the
proposed paragraph 806.22(f)(13)
pertaining to hydrocarbon water storage
facilities need to be separated from
provisions relating to public water
supply and wastewater sources because
of the possible application of the terms
to third party water purveyors building
hydrocarbon water storage facilities that
may not be associated with ABRs.
Response: The changes incorporated
into the final rule break out a separate
paragraph 806.22(f)(14), clarifying the
scope and intent, but make no
substantive changes to the provisions
contained in the proposed rulemaking.
The rule is intended to provide for the
approval of such facilities (not
otherwise associated with an ABR) to
provide a mechanism for monitoring,
reporting and tracking associated with
such facilities, and to allow for the
industry to efficiently register such
sources for use.
Paragraph 806.22(f)(15)
Comment: The language in paragraphs
806.22(f)(12)(i) and (ii) relating to
providing a copy of any registration or
source approval to the appropriate
agency of a member state, etc., is
repetitive.
Response: Language related to
registrations and source approvals that
is repetitive is removed and restated
once in new paragraph 806.22(f)(15).
List of Subjects in 18 CFR Part 806
Administrative practice and
procedure, Water resources.
Accordingly, for the reasons set forth
in the preamble, the Susquehanna River
Basin Commission amends 18 CFR part
806 as follows:
PART 806—REVIEW AND APPROVAL
OF PROJECTS
1. The authority citation for Part 806
continues to read as follows:
■
Authority: Secs. 3.4, 3.5(5), 3.8, 3.10 and
15.2, Pub. L. 91–575, 84 Stat. 1509 et seq.
Subpart A—General Provisions
2. Amend § 806.3 by adding
definitions for ‘‘Flowback’’, ‘‘Formation
fluids’’, ‘‘Hydrocarbon development’’,
‘‘Hydrocarbon water storage facility’’,
‘‘Production fluids’’, ‘‘Tophole water’’,
and ‘‘Unconventional natural gas
■
PO 00000
Frm 00010
Fmt 4700
Sfmt 4700
development,’’ and revising the
definition of ‘‘Project’’ to read as
follows:
§ 806.3
Definitions.
*
*
*
*
*
Flowback. The return flow of water
and formation fluids recovered from the
wellbore of an unconventional natural
gas or hydrocarbon development well
following the release of pressures
induced as part of the hydraulic fracture
stimulation of a target geologic
formation, and until the well is placed
into production.
Formation fluids. Fluids in a liquid or
gaseous physical state, present within
the pore spaces, fractures, faults, vugs,
caverns, or any other spaces of
formations, whether or not naturally
occurring or injected therein.
*
*
*
*
*
Hydrocarbon development. Activity
associated with the drilling, casing,
cementing, stimulation and completion
of wells, including but not limited to
unconventional natural gas
development wells, undertaken for the
purpose of extraction of liquid or
gaseous hydrocarbons from geologic
formations.
Hydrocarbon water storage facility.
An engineered barrier or structure,
including but not limited to tanks, pits
or impoundments, constructed for the
purpose of storing water, flowback or
production fluids for use in
hydrocarbon development.
*
*
*
*
*
Production fluids. Water or formation
fluids recovered at the wellhead of a
producing hydrocarbon well as a byproduct of the production activity.
Project. Any work, service, activity, or
facility undertaken, which is separately
planned, financed or identified by the
Commission, or any separate facility
undertaken or to be undertaken by the
Commission or otherwise within a
specified area, for the conservation,
utilization, control, development, or
management of water resources, which
can be established and utilized
independently, or as an addition to an
existing facility, and can be considered
as a separate entity for purposes of
evaluation. For purposes of hydrocarbon
development activity, including that
related to unconventional natural gas
development, the project shall be
considered to be the drilling pad upon
which one or more exploratory or
production wells are undertaken, and
all water-related appurtenant facilities
and activities related thereto.
*
*
*
*
*
Tophole water. Water that is brought
to the surface while drilling through the
E:\FR\FM\14FER1.SGM
14FER1
Federal Register / Vol. 77, No. 30 / Tuesday, February 14, 2012 / Rules and Regulations
strata containing fresh groundwater.
Tophole water may contain drill
cuttings typical of the formation being
penetrated but may not be polluted or
contaminated by additives, brine, oil or
man induced conditions.
Unconventional natural gas
development. Activity associated with
the drilling, casing, cementing,
stimulation and completion of wells
undertaken for the purpose of extraction
of gaseous hydrocarbons from low
permeability geologic formations
utilizing enhanced drilling, stimulation
or recovery techniques.
*
*
*
*
*
■ 3. In § 806.4, revise paragraph (a)(3)
introductory text, add paragraphs
(a)(3)(v) and (a)(3)(vi), and revise
paragraph (a)(8), as follows:
pmangrum on DSK3VPTVN1PROD with RULES
§ 806.4 Projects requiring review and
approval.
(a) * * *
(3) Diversions. Except with respect to
agricultural water use projects not
subject to the requirements of paragraph
(a)(1) of this section, the projects
described in paragraphs (a)(3)(i) through
(a)(3)(iv) of this section shall require an
application to be submitted in
accordance with § 806.13, and shall be
subject to the standards set forth in
§ 806.24. The project sponsors of out-ofbasin diversions shall also comply with
all applicable requirements of this part
relating to consumptive uses and
withdrawals. The projects identified in
paragraphs (a)(3)(v) and (a)(3)(vi) of this
section shall be subject to regulation
pursuant to § 806.22(f).
*
*
*
*
*
(v) The interbasin diversion of any
flowback or production fluids from
hydrocarbon development projects from
one drilling pad site to another drilling
pad site for use in hydrofracture
stimulation, provided it is handled,
transported and stored in compliance
with all standards and requirements of
the applicable member jurisdiction,
shall not be subject to separate review
and approval as a diversion under this
paragraph if the generating or receiving
pad site is subject to an Approval by
Rule issued pursuant to § 806.22(f) and
provided all monitoring and reporting
requirements applicable to such
approval are met.
(vi) The diversion of flowback or
production fluids from a hydrocarbon
development project for which an
Approval by Rule has been issued
pursuant to § 806.22(f), to an out-ofbasin treatment or disposal facility
authorized under separate governmental
approval to accept flowback or
production fluids, shall not be subject to
VerDate Mar<15>2010
14:25 Feb 13, 2012
Jkt 226001
separate review and approval as a
diversion under this paragraph,
provided all monitoring and reporting
requirements applicable to the Approval
by Rule are met and it is handled,
transported and stored in compliance
with all standards and requirements of
the applicable member jurisdiction.
*
*
*
*
*
(8) Any unconventional natural gas
development project in the basin
involving a withdrawal, diversion or
consumptive use, regardless of the
quantity.
*
*
*
*
*
Subpart B—Application Procedure
■
4. Revise § 806.13 to read as follows:
§ 806.13
Submission of application.
Sponsors of projects subject to review
and approval of the Commission under
§§ 806.4, 806.5 or 806.6, or project
sponsors seeking renewal of an existing
approval of the Commission, shall
submit an application and applicable
fee to the Commission, in accordance
with this subpart.
■ 5. In § 806.14, revise paragraph (a)
introductory text to read as follows:
§ 806.14
Contents of application.
(a) Except with respect to applications
to renew an existing Commission
approval, applications shall include, but
not be limited to, the following
information and, where applicable, shall
be submitted on forms and in the
manner prescribed by the Commission.
Renewal applications shall include such
information that the Commission
determines to be necessary for the
review of same, shall be subject to the
standards set forth in Subpart C—
Standards for Review and Approval of
this part, and shall likewise be
submitted on forms and in the manner
prescribed by the Commission.
*
*
*
*
*
■ 6. In § 806.15, revise paragraphs (d),
(e) and (f) and add paragraph (g), as
follows:
§ 806.15
Notice of application.
*
*
*
*
*
(d) For applications submitted under
§ 806.22(f)(13) for a public water supply
source, the newspaper notice
requirement contained in paragraph (a)
of this section shall be satisfied by
publication in a newspaper of general
circulation in the area served by the
public water supply.
(e) For applications submitted under
§ 806.22(f)(13) for a wastewater
discharge source, the newspaper notice
requirement contained in paragraph (a)
of this section shall be satisfied by
PO 00000
Frm 00011
Fmt 4700
Sfmt 4700
8099
publication in a newspaper of general
circulation in each area within which
the water obtained from such source
will initially be used for natural gas
development.
(f) For applications submitted under
§ 806.22(f)(14) for a hydrocarbon water
storage facility, the newspaper notice
requirement contained in paragraph (a)
of this section shall be satisfied by
publication in a newspaper of general
circulation in the area in which the
facility is located.
(g) The project sponsor shall provide
the Commission with a copy of the
United States Postal Service return
receipt for the notifications to agencies
of member States, municipalities and
county planning agencies required
under paragraph (a) of this section. The
project sponsor shall also provide
certification on a form provided by the
Commission that it has published the
newspaper notice(s) required by this
section and made the landowner
notifications as required under
paragraph (b) of this section, if
applicable. Until these items are
provided to the Commission, processing
of the application will not proceed. The
project sponsor shall maintain all proofs
of notice required hereunder for the
duration of the approval related to such
notices.
Subpart C—Standards for Review and
Approval
7. In § 806.22, revise paragraphs (e)(1),
(e)(6), (f) introductory text, (f)(1), (f)(4),
(f)(6), (f)(8), (f)(9), (f)(11), and (f)(12),
and add paragraphs (f)(13), (f)(14) and
(f)(15), to read as follows:
■
§ 806.22 Standards for consumptive uses
of water.
*
*
*
*
*
(e) * * *
(1) Except with respect to projects
involving hydrocarbon development
subject to the provisions of paragraph (f)
of this section, any project whose sole
source of water for consumptive use is
a public water supply, may be approved
by the Executive Director under this
paragraph (e) in accordance with the
following, unless the Executive Director
determines that the project cannot be
adequately regulated under this
approval by rule.
*
*
*
*
*
(6) The Executive Director may grant,
deny, suspend, rescind, modify or
condition an approval to operate under
this approval by rule, or renew an
existing approval by rule previously
granted hereunder, and will notify the
project sponsor of such determination,
E:\FR\FM\14FER1.SGM
14FER1
pmangrum on DSK3VPTVN1PROD with RULES
8100
Federal Register / Vol. 77, No. 30 / Tuesday, February 14, 2012 / Rules and Regulations
including the quantity of consumptive
use approved.
*
*
*
*
*
(f) Approval by rule for consumptive
use related to unconventional natural
gas and other hydrocarbon
development.
(1) Any unconventional natural gas
development project, or any
hydrocarbon development project
subject to review and approval under
§§ 806.4, 806.5, or 806.6 of this part,
shall be subject to review and approval
by the Executive Director under this
paragraph (f) regardless of the source or
sources of water being used
consumptively.
*
*
*
*
*
(4) The project sponsor shall comply
with metering, daily use monitoring and
quarterly reporting as specified in
§ 806.30, or as otherwise required by the
approval by rule. Daily use monitoring
shall include amounts delivered or
withdrawn per source, per day, and
amounts used per gas well, per day, for
well drilling, hydrofracture stimulation,
hydrostatic testing, and dust control.
The foregoing shall apply to all water,
including stimulation additives,
flowback, drilling fluids, formation
fluids and production fluids, utilized by
the project. The project sponsor shall
also submit a post-hydrofracture report
in a form and manner as prescribed by
the Commission.
*
*
*
*
*
(6) Any flowback or production fluids
utilized by the project sponsor for
hydrofracture stimulation undertaken at
the project shall be separately accounted
for, but shall not be included in the
daily consumptive use amount
calculated for the project, or be subject
to the mitigation requirements of
§ 806.22(b).
*
*
*
*
*
(8) The project sponsor shall certify to
the Commission that all flowback and
production fluids have been re-used or
treated and disposed of in accordance
with applicable state and federal law.
(9) The Executive Director may grant,
deny, suspend, rescind, modify or
condition an approval to operate under
this approval by rule, or renew an
existing approval by rule granted
hereunder, and will notify the project
sponsor of such determination,
including the sources and quantity of
consumptive use approved. The
issuance of any approval hereunder
shall not be construed to waive or
exempt the project sponsor from
obtaining Commission approval for any
water withdrawals or diversions subject
to review pursuant to § 806.4(a). Any
sources of water approved pursuant to
VerDate Mar<15>2010
14:25 Feb 13, 2012
Jkt 226001
this section shall be further subject to
any approval or authorization required
by the member jurisdiction.
*
*
*
*
*
(11) In addition to water sources
approved for use by the project sponsor
pursuant to § 806.4 or this section, for
unconventional natural gas
development or hydrocarbon
development, whichever is applicable, a
project sponsor issued an approval by
rule pursuant to paragraph (f) (9) of this
section may utilize any of the following
water sources at the drilling pad site,
subject to such monitoring and
reporting requirements as the
Commission may prescribe:
(i) Tophole water encountered during
the drilling process, provided it is used
only for drilling or hydrofracture
stimulation.
(ii) Precipitation or stormwater
collected on the drilling pad site,
provided it is used only for drilling or
hydrofracture stimulation.
(iii) Drilling fluids, formation fluids,
flowback or production fluids obtained
from a drilling pad site, production well
site or hydrocarbon water storage
facility, provided it is used only for
hydrofracture stimulation, and is
handled, transported and stored in
compliance with all standards and
requirements of the applicable member
jurisdiction.
(iv) Water obtained from a
hydrocarbon water storage facility
associated with an approval issued by
the Commission pursuant to § 806.4(a)
or by the Executive Director pursuant to
this section, provided it is used only for
the purposes authorized therein, and in
compliance with all standards and
requirements of the applicable member
jurisdiction.
(12) A project sponsor issued an
approval by rule pursuant to paragraph
(f)(9) of this section may utilize a source
of water approved by the Commission
pursuant to § 806.4(a), or by the
Executive Director pursuant to
paragraph (f)(14) of this section, and
issued to persons other than the project
sponsor, provided any such source is
approved for use in unconventional
natural gas development, or
hydrocarbon development, whichever is
applicable, the project sponsor has an
agreement for its use, and at least 10
days prior to use, the project sponsor
registers such source with the
Commission on a form and in the
manner prescribed by the Commission.
(13) A project sponsor issued an
approval by rule pursuant to paragraph
(f)(9) of this section may also utilize
other sources of water, including but not
limited to, public water supply or
PO 00000
Frm 00012
Fmt 4700
Sfmt 9990
wastewater discharge not otherwise
associated with an approval issued by
the Commission pursuant to § 806.4(a)
or an approval by rule issued pursuant
to paragraph (f)(9) of this section,
provided such sources are first
approved by the Executive Director.
Any request for approval shall be
submitted on a form and in the manner
prescribed by the Commission, shall
satisfy the notice requirements set forth
in § 806.15, and shall be subject to
review pursuant to the standards set
forth in subpart C of this part.
(14) A project sponsor issued an
approval by rule pursuant to paragraph
(f)(9) of this section may utilize water
obtained from a hydrocarbon water
storage facility that is not otherwise
associated with an approval issued by
the Commission pursuant to § 806.4(a),
or an approval by rule issued pursuant
to paragraph (f)(9) of this section,
provided such sources are first
approved by the Executive Director and
are constructed and maintained in
compliance with all standards and
requirements of the applicable member
jurisdiction. The owner or operator of
any such facility shall submit a request
for approval on a form and in the
manner prescribed by the Commission,
shall satisfy the notice requirements set
forth in § 806.15, and shall be subject to
review pursuant to the standards set
forth in subpart C of this part.
(15) The project sponsor shall provide
a copy of any registration or source
approval issued pursuant to this section
to the appropriate agency of the
applicable member jurisdiction. The
project sponsor shall record on a daily
basis, and report quarterly on a form
and in a manner prescribed by the
Commission, the quantity of water
obtained from any source registered or
approved hereunder. Any source
approval issued hereunder shall also be
subject to such monitoring and
reporting requirements as may be
contained in such approval or otherwise
required by this part.
Dated: January 27, 2012.
Thomas W. Beauduy,
Deputy Executive Director.
[FR Doc. 2012–2504 Filed 2–13–12; 8:45 am]
BILLING CODE 7040–01–P
E:\FR\FM\14FER1.SGM
14FER1
]]>Agencies
[Federal Register Volume 77, Number 30 (Tuesday, February 14, 2012)]
[Rules and Regulations]
[Pages 8095-8100]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-2504]
=======================================================================
-----------------------------------------------------------------------
SUSQUEHANNA RIVER BASIN COMMISSION
18 CFR Part 806
Review and Approval of Projects
AGENCY: Susquehanna River Basin Commission.
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: This document contains final rules that would amend the
project review regulations of the Susquehanna River Basin Commission
(Commission) to include definitions for new terms and an amended
definition; provide for administrative approval of interbasin transfers
of flowback and production fluids between drilling pad sites that are
isolated from the waters of the basin; provide for administrative
approval of out-of-basin transfers of flowback or produced fluids from
a Commission approved hydrocarbon development project to an out-of-
basin treatment or disposal facility; insert language authorizing
renewal of expiring approvals, including Approvals by Rule (ABRs);
delete specific references to geologic formations that may be the
subject of natural gas development using hydrofracture stimulation and
replace with a generic category--``unconventional natural gas
development;'' broaden the scope of ABRs issued to include hydrocarbon
development of any kind utilizing the waters of the basin, not just
unconventional natural gas well development; memorialize the current
practice of requiring post-hydrofracture reporting; and provide further
procedures for the approval of water sources utilized at projects
subject to the ABR process.
DATES: Effective April 1, 2012.
ADDRESSES: Susquehanna River Basin Commission, 1721 North Front Street,
Harrisburg, PA 17102-2391.
FOR FURTHER INFORMATION CONTACT: Richard A. Cairo, General Counsel,
telephone: 717-238-0423, ext. 306; fax: 717-238-2436; email:
rcairo@srbc.net. Also, for further information on the proposed
rulemaking, visit the Commission's Web site at www.srbc.net.
SUPPLEMENTARY INFORMATION:
[[Page 8096]]
Comments and Responses to Proposed Rulemaking
Notice of proposed rulemaking was published in the Federal Register
on July 13, 2011; the New York Register on July 27, 2011; the
Pennsylvania Bulletin on July 23, 2011; and the Maryland Register on
July 29, 2011. The Commission convened public hearings on August 2,
2011, in Harrisburg, Pennsylvania and on August 4, 2011, in Binghamton,
New York. Public information meetings were also held on October 25,
2011 in Williamsport, Pennsylvania, and on October 27, 2011, in Camp
Hill, Pennsylvania. The original 60-day comment period first
established on June 23, 2011, was extended until November 10, 2011,
pursuant to an action taken by the Commission on September 15, 2011.
Comments on the proposed rulemaking were received at both the hearings
and during the comment period. The comments can be divided into two
categories: (1) General Comments--These comments are not directed to
specific language of the proposed rulemaking, but rather address
perceived environmental and policy impacts; and (2) Comments by
Section--These comments are directed at the specific language of the
proposed rulemaking, often offering further revisions to this language.
A summary of both categories of comments and the Commission's responses
thereto follows.
General Comments
Comment: The Commission should more clearly explain the scientific
basis for the proposed rulemaking. Also, the Commission should conduct
a full life cycle cumulative impact study of the basinwide impacts of
unconventional natural gas extraction prior to issuing this rulemaking.
Response: The proposed rulemaking is administrative in nature and
involves no substantive change in the review standards applied to
projects. Therefore, the basis of the rulemaking does not involve the
analysis, evaluation or re-evaluation of scientific principals. On the
whole, it is an attempt to codify within the rules certain definitions,
existing practices and policies, and to establish certain procedures
related to implementation of the Commission's regulatory authority.
Comment: The more extensive use of the Approval by Rule (ABR)
process in this proposed rulemaking will weaken the Commission's
regulatory oversight and will simply make it easier for gas well
developers using hydrofracture stimulation methods to withdraw the
waters of the basin.
Response: The Commission believes that this comment indicates a
basic misunderstanding of the scope of the ABR process and the fact
that all withdrawal projects will continue to be docketed and acted on
by the full Commission. Through the docketing process, the Commission
actively manages the use of the basin's waters and mitigates impacts on
surface and ground waters through appropriate conditions limiting use.
The ABR process then provides an efficient monitoring system for waters
that are consumptively used. The Commission applies the same approval
standards to all approvals, no matter the form they take. It exercises
continuing jurisdiction and oversight to ensure compliance, and can
reopen approvals and issue new orders or conditions if warranted.
Comment: Use of the ABR process to oversee the interbasin transfer
of flowback and produced fluids and for the out of basin diversion of
such fluids for treatment poses a danger to the waters of the basin due
to its toxic content and the potential for spillage. The ABR process
also bypasses the usual analysis given to proposed diversions of water.
Response: The proposed rules simply formalize practices that are
already in place for the transfer of such fluids. These procedures will
provide a net benefit to the basin by encouraging the use and reuse of
lesser quality water instead of unimpaired water from streams or ground
water sources. Furthermore, unlike the typical diversion of water out
of the basin where the consumptive loss occurs and is evaluated in the
context of the proposed diversion activity, the consumptive loss in
this situation is considered to have occurred at the time of the
initial withdrawal from the system, before its first use within the
basin and prior to being diverted out of the basin. For into-basin
diversions, the existing standards are focused on limiting any
introduction of contaminated sources into the waters of the basin. The
final rulemaking, as structured, provides that same standard. What it
changes is the form of the approval, not the standard that should be
applied.
Comment: The Commission places too much reliance on allegedly
inadequate state water quality laws relating to wastewater disposal and
residual waste. For example, the Commission cannot rely on such state
laws and regulations to isolate from the waters of the basin the
flowback and production fluids whose interbasin transfer the Commission
proposes to approve administratively. Therefore, it is incumbent on the
Commission to invoke its own water quality regulatory authority and
ensure that wastewater is indeed handled in a manner that isolates it
from the waters of the basin.
Response: The Susquehanna River Basin Compact, Public Law 91-575,
Section 5.2(b) gives specific emphasis to the primary role of the
states in water quality management and control. Member states are
already exercising or preparing to exercise their water quality
authority with respect to gas drilling activity and are also
strengthening their laws and regulations. At this stage, there appears
to be no justification for the Commission to assume water quality
jurisdiction. As noted in response to a comment below, the Commission
is taking steps to replace the term ``isolate from the waters of the
basin'' with language that references the standards and requirements of
member jurisdictions.
Comment: The Commission's refusal to promulgate water quality
regulations relating to gas well development will allow the non-uniform
treatment of water users throughout the basin and therefore not conform
to the purposes of the Susquehanna River Basin Compact.
Response: The compact purpose of ``uniform treatment of water
users'' does not require that the Commission exclusively regulate all
aspects of water resources in the basin. If state regulations and
standards are compatible with the Commission's Comprehensive Plan and
do an adequate job of fulfilling the purposes of the plan, the
Commission will not attempt to duplicate those regulations and
standards. Where it does act, it does so in a manner that provides for
uniform treatment of all water users.
Comment: The expanded use of the ABR process lessens the
opportunity for public input and scrutiny on project approvals.
Response: The Commission disagrees. The ABR applications must be
noticed by applicants and there is an opportunity for interested
citizens to comment on these applications before an approval is issued.
ABRs are also subject to the same approval standards as docketed
approvals, and may be reopened and modified by the Executive Director
should unforeseen problems arise. Furthermore, notice of issuance of an
ABR is published in the Federal Register and any such approval is
subject to appeal pursuant to Sec. 808.2.
Comment: The Commission should not be extending the scope of the
ABR program to include other forms of hydrocarbon development without
first determining if the ABR program is
[[Page 8097]]
suitable for these other forms of development.
Response: The ABR process has proven to be a valuable tool for
monitoring consumptive use related activity on pad sites. This
rulemaking, which as noted above is administrative in nature, would
extend the use of this valuable tracking tool to other forms of
hydrocarbon development. Water withdrawals by any water user, including
that undertaken for use in other forms of hydrocarbon development, will
still undergo the full docket approval process, and be subject to all
applicable Commission standards and requirements.
Comment: The Commission is a federal agency under the Susquehanna
River Basin Compact and is subject to the National Environmental Policy
Act (NEPA). It must therefore complete all NEPA requirements in
connection with this proposed rulemaking action.
Response: The Commission categorically rejects any suggestion that
it is subject to NEPA. This is consistent with the position the
Commission has taken on NEPA since the 1980s. Instead of a federal
agency, the Commission is a federal-interstate compact agency
representing all four of its member jurisdictions. The federal
government is only one voting member of the Commission and any action
of the Commission requires the vote of a majority of the members.
Therefore, the actions of the Commission are not the actions of the
federal government, but the joint actions of the member jurisdictions.
Also, Congress has specifically exempted the Commission from the
provisions of the federal Administrative Procedures Act (APA). Federal
court decisions have taken a consistent view, namely that agencies not
subject to the APA are not federal agencies in the conventional sense
and are therefore not subject to NEPA or similar laws imposing
requirements on ``federal agencies.''
Comments by Section, Part 806
Section 806.3--Definitions
Comment: The 30-day rule in the proposed definition of flowback
means that fluid produced from the well bore from the 31st day until
the well is placed in production is neither flowback or production
fluid within the definition (unless the well is placed into production
during the initial 30-day period).
Response: Agreed. The proposed definition is modified to remove the
30-day reference and to make clear that return flow recovered post-
hydrofracture and pre-production is defined as flowback.
Comment: The word ``siting'' in the definitions of ``hydrocarbon
development'' and ``unconventional natural gas development'' is
inconsistent with the ``initiation of construction'' standard in the
Commission's project review regulations. The regulations specify the
``spudding of the well'' to be the initiation of a well project.
Response: Agreed. The word ``siting'' is deleted from this
definition to avoid the inconsistency.
Comment: The definition of ``project'' does not make clear that
``unconventional natural gas development'' is a subset of ``hydrocarbon
development activity.''
Response: Language is inserted in the definition to clarify that
the term is a sub-category of hydrocarbon development.
Comment: Several comments expressed disagreement with the proposed
definition of ``tophole water,'' with one suggesting use of
Pennsylvania's definition instead and another claiming that the
definition is too vague.
Response: The tophole water definition is replaced with a modified
version of the Pennsylvania definition. The modification, notably
removing the reference to surface water, makes it generally consistent
with New York's interpretation of the term and allows for more
basinwide consistency.
Section 806.4--Projects Requiring Review and Approval
Paragraphs 806.4(a)(3)(v) & (vi)
Comment: The phrase ``in such manner as to isolate it from the
waters of the basin'' is too vague and should be replaced with a
reference to the actual controls exercised by the member states. Also,
because the industry may mix the waters of the basin withdrawn from
surface and ground water sources with flowback or production fluids in
preparation for hydrofracture use, it is not possible to isolate it
from the waters of the basin if read strictly.
Response: The ``isolate'' terminology is replaced with ``provided
it is handled, transported and stored in compliance with all standards
and requirements of the applicable member jurisdictions.'' The same
language has also been inserted in Paragraph 806.4(a)(3)(vi), which
similarly addresses diversions of flowback or production fluids, and is
substituted in Paragraph 806.22(f)(11)(iii) for the same reason.
Comment: There is no clear requirement that project sponsors keep
track of interbasin transfers of flowback and production fluids.
Response: Language is added to paragraphs 806.4(a)(3)(v) and (vi)
reinforcing the requirement that all monitoring and reporting
requirements applicable to the pad site ABR must be met. Similar
language is added to paragraph 806.22(f)(11) to meet the same concerns
about tracking.
Paragraph 806.4(3)(vi)
Comment: The use of the phrase ``the same'' implies that each tank
load of flowback or production fluid would require separate approval.
Response: The language is replaced with ``flowback or production
fluids'' to remove any uncertainty.
Section 806.13--Submission of Application
Comment: The phrase ``Project sponsors of projects subject to
review and approval'' should properly be changed to read ``Sponsors of
projects subject to review and approval.''
Response: Agreed. The suggested change is incorporated into the
final rulemaking.
Section 806.14--Contents of Application
Paragraph 806.14(a)
Comment: With respect to renewal applications, there is no clear
indication that they will be made subject to any approval standards.
Response: To remove any ambiguity, and to further clarify the
original intent concerning renewal standards, the phrase ``shall be
subject to the standards set forth in Subpart C--Standards for Review
and Approval of this Part'' is added to this paragraph.
Section 806.15--Notice of Application
Paragraph 806.15(e)
Comment: The requirement for a newspaper notice in areas where a
wastewater discharge source is to be used is unworkable where such
water is mixed with other water sources at the initial destination and
is then redistributed, oftentimes to other locations not contemplated
at the time notice is given.
Response: The word ``initially'' is added before the phrase ``used
for natural gas development'' to limit this requirement to the initial
location(s) where this water is contemplated for use at the time of
application.
[[Page 8098]]
Section 806.22--Standards for Consumptive Use of Water
Paragraph 806.22(f)(10)
Comment: Extension of ABR approval terms to 15 years will
essentially lessen or weaken the oversight that the Commission
exercises over gas drilling activities.
Response: Though the Commission feels that there is a fundamental
misunderstanding by some who commented about the ongoing oversight that
it exercises over approved projects, and the ability of the Commission
to reopen approvals, it is willing to retain the current approval term
with the addition of procedures for renewal of ABRs. Therefore, the
proposed change is removed from the final rulemaking.
Paragraph 806.22(f)(11)
Comment: Need to make clear that this paragraph applies to the use
of sources in addition to those sources approved for use by the project
sponsor pursuant to Sec. 806.4.
Response: Wording is added to the beginning of this paragraph to
make the suggested clarification.
Paragraph 806.22(f)(11)(i), (ii), and (iv)
Comment: Tophole water, precipitation and storm water collected on
the pad site or water obtained from a hydrocarbon storage facility can
be contaminated, so there is a need to appropriately limit its use.
Response: Language is added limiting the use of this water to
drilling or hydrofracture stimulation only, or in the case of paragraph
806.22(f)(11)(iv), limiting the use to that provided for in the
approval.
Paragraph 806.22(f)(11)(iii)
Comment: As defined, flowback and production fluids do not cover
all fluids encountered in the drilling process that serve as a water
source under current practice. For example, water can be recovered from
drilling muds. Also, such fluids can be recovered from production well
sites, in addition to drilling pad sites or hydrocarbon water storage
facilities. Current Commission policy allows for the reuse of such
fluids.
Response: Drilling fluids and formation fluids are added to this
paragraph to cover all fluids recovered during the drilling process and
used under current practice for hydrofracture stimulation. The term
``production well site'' is also added to clarify the sites from which
such fluids can be recovered. The word ``only'' is also added to this
paragraph to make clear that these fluids may only be used for
hydrofracture stimulation. Language is also added clarifying that all
such fluids must be handled, transported and stored in compliance with
all standards and requirements of the applicable member jurisdiction.
Paragraph 806.22(f)(14)
Comment: The provisions of the proposed paragraph 806.22(f)(13)
pertaining to hydrocarbon water storage facilities need to be separated
from provisions relating to public water supply and wastewater sources
because of the possible application of the terms to third party water
purveyors building hydrocarbon water storage facilities that may not be
associated with ABRs.
Response: The changes incorporated into the final rule break out a
separate paragraph 806.22(f)(14), clarifying the scope and intent, but
make no substantive changes to the provisions contained in the proposed
rulemaking. The rule is intended to provide for the approval of such
facilities (not otherwise associated with an ABR) to provide a
mechanism for monitoring, reporting and tracking associated with such
facilities, and to allow for the industry to efficiently register such
sources for use.
Paragraph 806.22(f)(15)
Comment: The language in paragraphs 806.22(f)(12)(i) and (ii)
relating to providing a copy of any registration or source approval to
the appropriate agency of a member state, etc., is repetitive.
Response: Language related to registrations and source approvals
that is repetitive is removed and restated once in new paragraph
806.22(f)(15).
List of Subjects in 18 CFR Part 806
Administrative practice and procedure, Water resources.
Accordingly, for the reasons set forth in the preamble, the
Susquehanna River Basin Commission amends 18 CFR part 806 as follows:
PART 806--REVIEW AND APPROVAL OF PROJECTS
0
1. The authority citation for Part 806 continues to read as follows:
Authority: Secs. 3.4, 3.5(5), 3.8, 3.10 and 15.2, Pub. L. 91-
575, 84 Stat. 1509 et seq.
Subpart A--General Provisions
0
2. Amend Sec. 806.3 by adding definitions for ``Flowback'',
``Formation fluids'', ``Hydrocarbon development'', ``Hydrocarbon water
storage facility'', ``Production fluids'', ``Tophole water'', and
``Unconventional natural gas development,'' and revising the definition
of ``Project'' to read as follows:
Sec. 806.3 Definitions.
* * * * *
Flowback. The return flow of water and formation fluids recovered
from the wellbore of an unconventional natural gas or hydrocarbon
development well following the release of pressures induced as part of
the hydraulic fracture stimulation of a target geologic formation, and
until the well is placed into production.
Formation fluids. Fluids in a liquid or gaseous physical state,
present within the pore spaces, fractures, faults, vugs, caverns, or
any other spaces of formations, whether or not naturally occurring or
injected therein.
* * * * *
Hydrocarbon development. Activity associated with the drilling,
casing, cementing, stimulation and completion of wells, including but
not limited to unconventional natural gas development wells, undertaken
for the purpose of extraction of liquid or gaseous hydrocarbons from
geologic formations.
Hydrocarbon water storage facility. An engineered barrier or
structure, including but not limited to tanks, pits or impoundments,
constructed for the purpose of storing water, flowback or production
fluids for use in hydrocarbon development.
* * * * *
Production fluids. Water or formation fluids recovered at the
wellhead of a producing hydrocarbon well as a by-product of the
production activity.
Project. Any work, service, activity, or facility undertaken, which
is separately planned, financed or identified by the Commission, or any
separate facility undertaken or to be undertaken by the Commission or
otherwise within a specified area, for the conservation, utilization,
control, development, or management of water resources, which can be
established and utilized independently, or as an addition to an
existing facility, and can be considered as a separate entity for
purposes of evaluation. For purposes of hydrocarbon development
activity, including that related to unconventional natural gas
development, the project shall be considered to be the drilling pad
upon which one or more exploratory or production wells are undertaken,
and all water-related appurtenant facilities and activities related
thereto.
* * * * *
Tophole water. Water that is brought to the surface while drilling
through the
[[Page 8099]]
strata containing fresh groundwater. Tophole water may contain drill
cuttings typical of the formation being penetrated but may not be
polluted or contaminated by additives, brine, oil or man induced
conditions.
Unconventional natural gas development. Activity associated with
the drilling, casing, cementing, stimulation and completion of wells
undertaken for the purpose of extraction of gaseous hydrocarbons from
low permeability geologic formations utilizing enhanced drilling,
stimulation or recovery techniques.
* * * * *
0
3. In Sec. 806.4, revise paragraph (a)(3) introductory text, add
paragraphs (a)(3)(v) and (a)(3)(vi), and revise paragraph (a)(8), as
follows:
Sec. 806.4 Projects requiring review and approval.
(a) * * *
(3) Diversions. Except with respect to agricultural water use
projects not subject to the requirements of paragraph (a)(1) of this
section, the projects described in paragraphs (a)(3)(i) through
(a)(3)(iv) of this section shall require an application to be submitted
in accordance with Sec. 806.13, and shall be subject to the standards
set forth in Sec. 806.24. The project sponsors of out-of-basin
diversions shall also comply with all applicable requirements of this
part relating to consumptive uses and withdrawals. The projects
identified in paragraphs (a)(3)(v) and (a)(3)(vi) of this section shall
be subject to regulation pursuant to Sec. 806.22(f).
* * * * *
(v) The interbasin diversion of any flowback or production fluids
from hydrocarbon development projects from one drilling pad site to
another drilling pad site for use in hydrofracture stimulation,
provided it is handled, transported and stored in compliance with all
standards and requirements of the applicable member jurisdiction, shall
not be subject to separate review and approval as a diversion under
this paragraph if the generating or receiving pad site is subject to an
Approval by Rule issued pursuant to Sec. 806.22(f) and provided all
monitoring and reporting requirements applicable to such approval are
met.
(vi) The diversion of flowback or production fluids from a
hydrocarbon development project for which an Approval by Rule has been
issued pursuant to Sec. 806.22(f), to an out-of-basin treatment or
disposal facility authorized under separate governmental approval to
accept flowback or production fluids, shall not be subject to separate
review and approval as a diversion under this paragraph, provided all
monitoring and reporting requirements applicable to the Approval by
Rule are met and it is handled, transported and stored in compliance
with all standards and requirements of the applicable member
jurisdiction.
* * * * *
(8) Any unconventional natural gas development project in the basin
involving a withdrawal, diversion or consumptive use, regardless of the
quantity.
* * * * *
Subpart B--Application Procedure
0
4. Revise Sec. 806.13 to read as follows:
Sec. 806.13 Submission of application.
Sponsors of projects subject to review and approval of the
Commission under Sec. Sec. 806.4, 806.5 or 806.6, or project sponsors
seeking renewal of an existing approval of the Commission, shall submit
an application and applicable fee to the Commission, in accordance with
this subpart.
0
5. In Sec. 806.14, revise paragraph (a) introductory text to read as
follows:
Sec. 806.14 Contents of application.
(a) Except with respect to applications to renew an existing
Commission approval, applications shall include, but not be limited to,
the following information and, where applicable, shall be submitted on
forms and in the manner prescribed by the Commission. Renewal
applications shall include such information that the Commission
determines to be necessary for the review of same, shall be subject to
the standards set forth in Subpart C--Standards for Review and Approval
of this part, and shall likewise be submitted on forms and in the
manner prescribed by the Commission.
* * * * *
0
6. In Sec. 806.15, revise paragraphs (d), (e) and (f) and add
paragraph (g), as follows:
Sec. 806.15 Notice of application.
* * * * *
(d) For applications submitted under Sec. 806.22(f)(13) for a
public water supply source, the newspaper notice requirement contained
in paragraph (a) of this section shall be satisfied by publication in a
newspaper of general circulation in the area served by the public water
supply.
(e) For applications submitted under Sec. 806.22(f)(13) for a
wastewater discharge source, the newspaper notice requirement contained
in paragraph (a) of this section shall be satisfied by publication in a
newspaper of general circulation in each area within which the water
obtained from such source will initially be used for natural gas
development.
(f) For applications submitted under Sec. 806.22(f)(14) for a
hydrocarbon water storage facility, the newspaper notice requirement
contained in paragraph (a) of this section shall be satisfied by
publication in a newspaper of general circulation in the area in which
the facility is located.
(g) The project sponsor shall provide the Commission with a copy of
the United States Postal Service return receipt for the notifications
to agencies of member States, municipalities and county planning
agencies required under paragraph (a) of this section. The project
sponsor shall also provide certification on a form provided by the
Commission that it has published the newspaper notice(s) required by
this section and made the landowner notifications as required under
paragraph (b) of this section, if applicable. Until these items are
provided to the Commission, processing of the application will not
proceed. The project sponsor shall maintain all proofs of notice
required hereunder for the duration of the approval related to such
notices.
Subpart C--Standards for Review and Approval
0
7. In Sec. 806.22, revise paragraphs (e)(1), (e)(6), (f) introductory
text, (f)(1), (f)(4), (f)(6), (f)(8), (f)(9), (f)(11), and (f)(12), and
add paragraphs (f)(13), (f)(14) and (f)(15), to read as follows:
Sec. 806.22 Standards for consumptive uses of water.
* * * * *
(e) * * *
(1) Except with respect to projects involving hydrocarbon
development subject to the provisions of paragraph (f) of this section,
any project whose sole source of water for consumptive use is a public
water supply, may be approved by the Executive Director under this
paragraph (e) in accordance with the following, unless the Executive
Director determines that the project cannot be adequately regulated
under this approval by rule.
* * * * *
(6) The Executive Director may grant, deny, suspend, rescind,
modify or condition an approval to operate under this approval by rule,
or renew an existing approval by rule previously granted hereunder, and
will notify the project sponsor of such determination,
[[Page 8100]]
including the quantity of consumptive use approved.
* * * * *
(f) Approval by rule for consumptive use related to unconventional
natural gas and other hydrocarbon development.
(1) Any unconventional natural gas development project, or any
hydrocarbon development project subject to review and approval under
Sec. Sec. 806.4, 806.5, or 806.6 of this part, shall be subject to
review and approval by the Executive Director under this paragraph (f)
regardless of the source or sources of water being used consumptively.
* * * * *
(4) The project sponsor shall comply with metering, daily use
monitoring and quarterly reporting as specified in Sec. 806.30, or as
otherwise required by the approval by rule. Daily use monitoring shall
include amounts delivered or withdrawn per source, per day, and amounts
used per gas well, per day, for well drilling, hydrofracture
stimulation, hydrostatic testing, and dust control. The foregoing shall
apply to all water, including stimulation additives, flowback, drilling
fluids, formation fluids and production fluids, utilized by the
project. The project sponsor shall also submit a post-hydrofracture
report in a form and manner as prescribed by the Commission.
* * * * *
(6) Any flowback or production fluids utilized by the project
sponsor for hydrofracture stimulation undertaken at the project shall
be separately accounted for, but shall not be included in the daily
consumptive use amount calculated for the project, or be subject to the
mitigation requirements of Sec. 806.22(b).
* * * * *
(8) The project sponsor shall certify to the Commission that all
flowback and production fluids have been re-used or treated and
disposed of in accordance with applicable state and federal law.
(9) The Executive Director may grant, deny, suspend, rescind,
modify or condition an approval to operate under this approval by rule,
or renew an existing approval by rule granted hereunder, and will
notify the project sponsor of such determination, including the sources
and quantity of consumptive use approved. The issuance of any approval
hereunder shall not be construed to waive or exempt the project sponsor
from obtaining Commission approval for any water withdrawals or
diversions subject to review pursuant to Sec. 806.4(a). Any sources of
water approved pursuant to this section shall be further subject to any
approval or authorization required by the member jurisdiction.
* * * * *
(11) In addition to water sources approved for use by the project
sponsor pursuant to Sec. 806.4 or this section, for unconventional
natural gas development or hydrocarbon development, whichever is
applicable, a project sponsor issued an approval by rule pursuant to
paragraph (f) (9) of this section may utilize any of the following
water sources at the drilling pad site, subject to such monitoring and
reporting requirements as the Commission may prescribe:
(i) Tophole water encountered during the drilling process, provided
it is used only for drilling or hydrofracture stimulation.
(ii) Precipitation or stormwater collected on the drilling pad
site, provided it is used only for drilling or hydrofracture
stimulation.
(iii) Drilling fluids, formation fluids, flowback or production
fluids obtained from a drilling pad site, production well site or
hydrocarbon water storage facility, provided it is used only for
hydrofracture stimulation, and is handled, transported and stored in
compliance with all standards and requirements of the applicable member
jurisdiction.
(iv) Water obtained from a hydrocarbon water storage facility
associated with an approval issued by the Commission pursuant to Sec.
806.4(a) or by the Executive Director pursuant to this section,
provided it is used only for the purposes authorized therein, and in
compliance with all standards and requirements of the applicable member
jurisdiction.
(12) A project sponsor issued an approval by rule pursuant to
paragraph (f)(9) of this section may utilize a source of water approved
by the Commission pursuant to Sec. 806.4(a), or by the Executive
Director pursuant to paragraph (f)(14) of this section, and issued to
persons other than the project sponsor, provided any such source is
approved for use in unconventional natural gas development, or
hydrocarbon development, whichever is applicable, the project sponsor
has an agreement for its use, and at least 10 days prior to use, the
project sponsor registers such source with the Commission on a form and
in the manner prescribed by the Commission.
(13) A project sponsor issued an approval by rule pursuant to
paragraph (f)(9) of this section may also utilize other sources of
water, including but not limited to, public water supply or wastewater
discharge not otherwise associated with an approval issued by the
Commission pursuant to Sec. 806.4(a) or an approval by rule issued
pursuant to paragraph (f)(9) of this section, provided such sources are
first approved by the Executive Director. Any request for approval
shall be submitted on a form and in the manner prescribed by the
Commission, shall satisfy the notice requirements set forth in Sec.
806.15, and shall be subject to review pursuant to the standards set
forth in subpart C of this part.
(14) A project sponsor issued an approval by rule pursuant to
paragraph (f)(9) of this section may utilize water obtained from a
hydrocarbon water storage facility that is not otherwise associated
with an approval issued by the Commission pursuant to Sec. 806.4(a),
or an approval by rule issued pursuant to paragraph (f)(9) of this
section, provided such sources are first approved by the Executive
Director and are constructed and maintained in compliance with all
standards and requirements of the applicable member jurisdiction. The
owner or operator of any such facility shall submit a request for
approval on a form and in the manner prescribed by the Commission,
shall satisfy the notice requirements set forth in Sec. 806.15, and
shall be subject to review pursuant to the standards set forth in
subpart C of this part.
(15) The project sponsor shall provide a copy of any registration
or source approval issued pursuant to this section to the appropriate
agency of the applicable member jurisdiction. The project sponsor shall
record on a daily basis, and report quarterly on a form and in a manner
prescribed by the Commission, the quantity of water obtained from any
source registered or approved hereunder. Any source approval issued
hereunder shall also be subject to such monitoring and reporting
requirements as may be contained in such approval or otherwise required
by this part.
Dated: January 27, 2012.
Thomas W. Beauduy,
Deputy Executive Director.
[FR Doc. 2012-2504 Filed 2-13-12; 8:45 am]
BILLING CODE 7040-01-P
