EARTHWORKS

New York Oil & Gas Enforcement - Inspections

Inspection Capacity – inadequate

As in other states reviewed by Earthworks, inspections have not kept pace with the growth of oil and gas development in New York.

New York inspections and wells

Click chart for larger version

Data on active oil and gas wells in New York and inspections conducted by the oil and gas staff of the Division of Mineral Resources (DMR) can be found in the division’s Oil, Gas, and Mineral Resources Annual Reports. The most recent Annual Report was published in 2010, and contained statistics for 2009. 2010 data for active wells and inspections were found from other sources.[1]

These data show that inspections in New York have declined in the past few years, despite a growth in the number of active wells. The number of oil and gas inspections decreased by more than 1,000 per year between 2001 and 2010. Meanwhile, the number of active wells increased by approximately 1,000 over the same time period.

In 2002, DMR inspectors were conducting one inspection per 2.6 active wells. By 2010, they were only able to conduct one inspection per every 4 active wells.[2] As a result, at least 7,854 active wells in New York failed to be inspected in 2010.[3]

As the data in this table show, in 2010 more than 75 percent of active wells (3 out of 4) were not inspected in New York. Compared with other states that we reviewed, only Pennsylvania and Ohio inspectors failed to inspect a higher percentage of active wells in 2010.

Estimated number of active wells that were not inspected in 2010
Estimated number of active wells that were not inspected in 2010
Click chart for larger, footnoted version

Inspection policy - needed

How frequently are wells inspected? How frequently should they be inspected?

According to the DMR’s 2009 Oil, Gas and Mineral Resources Annual Report, oil and gas staff inspect well sites:

The annual report does not elaborate on how often or for how long inspectors are present during drilling activities (drilling and well completion can last for weeks), and how frequently wells are inspected during their operating phase (wells can operate for decades).

Currently there are no accepted best practices for inspections. However, some states have developed guidelines for how frequently oil and gas wells should be inspected. This table shows that relative to Pennsylvania and North Dakota, New York’s current suggested inspection frequencies are much lower.

Suggested inspection frequencies in PA, ND and NY
Suggested inspection frequencies in PA, ND and NY
Click chart for larger, footnoted version

On the New York Department of Environmental Conservation (DEC) web site, the department states that if high-volue hydraulic fracturing (HVHF) is used to drill oil and gas wells, drilling permits will only be issued to the extent that the department has the resources to review and oversee activities. Similarly, in the revised draft environmental impact statement related to Marcellus shale develompent, DEC proposed to "limit [drilling] permit issuance to match the Department resources that are made available to review and approve permit applications, and to adequately inspect well pads and enforce permit conditions and regulations.”[4]

In July 2012, the Times Union quoted a DEC spokesperson as saying "the state's draft plan would require at least 13 inspections during each well drilling and completion." If this becomes a binding policy, it will be a vast improvement over their current inspection program (seen in the table above). 

From the limited information available, it appears that DEC's current approach to determining the number of oil-and-gas-related inspections may be far from adequate. For example, DEC's Division of Water (DOW) has the primary responsibility for site inspections related to oil and gas stormwater permits. According to DOW, "The number and type of inspections to be performed at permitted facilities are determined during DOW's annual work planning process."[5] This suggests that DOW determines the number of inspections based on available inspectors, rather that determining how many inspections should be conducted based on what is needed to ensure effective oversight of these facilities.

DEC should develop a binding inspection policy that outlines when and how often inspections must occur. Such a document will help the agency determine how many drilling permits it can handle with available staff, while still performing the required inspection and enforcement duties.

DEC inspection and enforcement staff - must be increased

If allowed to proceed, the majority of future oil and gas development in New York is going to be from unconventional oil and gas wells, with the higher volumes of water and chemicals used and waste produced. In September 2011, Gannett news reported that DEC estimated it would need “an additional 226 staffers within five years if high-volume hydrofracking moves forward in New York.” The article also said that, “The DEC has been hit particularly hard by staff cuts in recent years, losing 806 full-time employees since April 2008.”

Whether or not New York will be able to hire and retain experienced oil and gas agency staff remains and open question. Pennsylvania and Texas have recently increased inspection capacity in response to a booming shale gas and oil industry, but both states have had a difficult time keeping positions filled.

In 2011, Citizens Voice reported that the Pennsylvania Department of Environmental Projection was able to hire oil and gas program staff but retaining them was a challenge. At least four former well-site inspectors had been hired away by oil and gas companies operating in Pennsylvania. In 2011, the Texas Sunset Advisory Commission reviewed the Texas Railroad Commission (agency responsible for oil and gas oversight) and found that “. . . inadequate pay and lack of career advancement resulted in 26 employees under the age of 40 leaving in 2009,” and “. . .having to compete with higher paying private sector jobs also creates barriers to recruiting employees.[6]”

There is no doubt that additional inspection staff need to be hired to ensure that existing and new wells receive adequate oversight. DEC needs to ensure that it can fund oversight efforts (wages must be high enough to attract and keep qualified, experienced staff) before it begins to permit new wells.

 

Page updated July 31, 2012


For more information:

Endnotes

1 2010 inspection data from: McAllister, E. June 29, 2011. “Insight: NY water at risk from lack of natgas inspectors?” Reuters.

2010 data on active wells from: New York Department of Environmental Conservation web site: “Yearly oil and gas production files.” 2010. Filtered by Well Status = AC (active).

2 View data and citations by clicking on table below. NOTE: This table was updated July 25, 2012, based on new information. Other charts on our enforcement web pages may not yet reflect these updates.

New York inspection statistics

Click chart for larger, footnoted version

3 We assumed that each inspection occurred at a different well. However, some wells in New York were most likely visited more than once, as the DEC says it inspects new well sites both during the permit application and during the drilling process. (Source: New York Division of Mineral Resources. 2009 Oil, Gas and Mineral Resources Annual Report. p. 20.) So the actual number of New York’s uninspected wells was probably more than the 7,854 – 76 percent of total active wells – indicated in the table "Estimated number of active wells that were not inspected in 2010".

4 New York Department of Environmental Conservation. Draft SGEIS. Executive Summary. pp. 27, 28.

5 Revised Draft Supplemental Generic Environmental Impact Statement (SGEIS) for “Well permit issuance for horizontal drilling and high-volume hydraulic fracturing to develop the Marcellus Shale and other low-permeability gas reservoirs.” 2011. pp. 8-32 and 8-46.

6 Sunset Advisory Commission. July 2011. Final Report - Railroad Commission of Texas. pp. 52,53.

Tagged with: regulations, oil and gas, new york department of environmental conservation, new york, inspections, fracking, enforcement, drilling

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