IOGA of NY Response/Revisions to DEC on New Fracking Rules

January 11, 2013

New York State Department of Environmental Conservation
625 Broadway
Albany, NY 12233-6510

Subject: Draft HVHF Regulations Comments

Dear Sir/Madam:

Enclosed please find comments from the Independent Oil and Gas Association of New York (IOGA New
York) relative to the Revised Proposed Regulations proposing amendments to 6 NYCRR Parts 52 and 190,
Parts 550 through 556 and 560, and parts 750.1 and 750.3. Thank you for the opportunity to provide these
comments.

In reviewing these comments, you will find that IOGA New York has been forced to take a more
adversarial position with these proposals. Notwithstanding our excellent working relationship over the
years and all the efforts that have been made by industry to educate Department personnel regarding
modern natural gas drilling techniques and best management practices to minimize potential adverse
environmental impacts, it appears that most of our comments on the previous proposals have not been
given any credibility and that the Department has erroneously come to the conclusion that the shale
resources in New York State will only be developed by large operators. This is truly unfortunate. Because
of the failure of the Department to consider our comments that were submitted on January 11, 2012, we are
resubmitting those comments. In addition, we are enclosing detailed comments on the Revised Proposed
Regulations, together with suggested revisions to certain sections of the Revised Proposed Regulations that
will ameliorate the adverse consequences of these proposals, without compromising environmental quality.
Finally, we are also submitting additional letters from companies that qualify as small businesses under the
State Administrative Procedure Act (“SAPA”) to reinforce the need for the Department to provide
flexibility with these regulatory proposals and to meet the requirements of SAPA to reduce burdens on
small businesses.

As you are well aware, IOGA New York supports a high environmental bar, but the bar must be attainable
by industry in order to have the valuable shale resources in this state properly developed. These regulations
are replete with requirements that have no foundation in science or in the long history of modern drilling in
New York State without adverse environmental consequences. In addition, in a number of instances, the
Department has exceeded its regulatory authority, again with no scientific or historical basis for the
offensive proposals. For example, one of the most glaring issues is the proposal by the Department to
require a 300-foot setback from wetlands regulated by the United States Army Corps of Engineers. As you
are well aware, the jurisdiction of the Department over wetlands is limited by Environmental Conservation
Law Article 24, wherein the Legislature made the determination that only a 100-foot buffer zone is required
from state jurisdictional wetlands. By attempting to regulate federal wetlands and also to implement a
buffer requirement that is three times the statutory buffer for state wetlands, the Department has proposed a
requirement that is not only illegal, but, in conjunction with the many other proposed setbacks and
prohibitions, will make it extremely difficult, if not impossible, to site a well pad in New York State.

38 Lake Street • Hamburg, New York 14075 • Phone (716) 202-4688 • Fax (716) 202-4689

Independent Oil & Gas Association Comment Letter
January 10, 2013

We welcome the opportunity to discuss any of these issues with you and your staff. We urge you to modify
these regulatory proposals in a manner that is lawful, attainable, protective of the environment and
consistent with the statutory mandate that the Department promote the development of oil and gas
resources in New York State and protect the correlative rights of landowners to do the same.

Thank you for your consideration of our comments and our proposed regulatory revisions.

Sincerely,

Independent Oil and Gas Association of New York,

Brad Gill Executive Director
Enclosures

cc: Andrew M. Cuomo, Governor
Joseph Martens, Commissioner
Marc Gerstman, Executive Deputy Commissioner
Eugene Leff, Deputy Commissioner, Remediation and Materials Management
Steven Russo, Esq., General Counsel
Bradley J. Field, Director, Division of Mineral Resources
Thomas S. West, Esq., The West Firm, PLLC
James J. Carr, Hinman Straub PC

4811-8179-7138, v. 1

Page 2

Comments on the New York State Department of Environmental Conservation’s
Revised Proposed Regulations for High-Volume Hydraulic Fracturing
Submitted by the Independent Oil and Gas Association of New York

January 11, 2013

The Independent Oil and Gas Association of New York (“IOGA”) respectfully submits
the following comments regarding the Revised Proposed Express Terms 6 NYCRR Parts 52 and
190 Use of State Lands Administered by the Division of Fish, Wildlife and Marine Resources
and Use of State Lands; Revised Proposed Express Terms 6 NYCRR Parts 550 through 556 and
560 Subchapter B: Mineral Resources; and Revised Proposed Express Terms 6 NYCRR Parts
750.1 and 750-3 Obtaining a SPDES Permit and High Volume Hydro Fracturing (HVHF)
(hereinafter the “Revised Proposed Regulations”), as well as the related documents issued
pursuant to the State Administrative Procedure Act (“SAPA”). As part of these comments,
IOGA has identified areas where the Revised Proposed Regulations and the related SAPA
documents fail to comply with legal requirements, thus rendering the Revised Proposed
Regulations legally defective and subject to challenge. In addition to the comments that follow,
Exhibit A is IOGA’s proposal on how some of the Revised Proposed Regulations should be
modified, which will bring the Revised Proposed Regulations into compliance with law and
improve the overall quality of the Revised Proposed Regulations without compromising
environmental standards.

Initially, IOGA would like to commend Department Staff’s continuing efforts regarding
these regulatory proposals, including the need to respond to an unprecedented number of public
comments. Although we recognize that the task at hand has been difficult for the Department, in
the final analysis, the overarching concern of industry remains the failure of the Department to
include provisions in the regulations that will allow Department Staff to implement the
regulations in a manner that protects the environment to the maximum extent practicable, but
does so in a manner that provides the necessary flexibility to allow the orderly development of
the shale resources in New York State consistent with the mandates of New York law.

IOGA previously submitted comments regarding the previously Proposed Express Terms
6 NYCRR Parts 52 and 190 Use of State Lands Administered by the Division of Fish, Wildlife
and Marine Resources and Use of State Lands; Proposed Express Terms 6 NYCRR Parts 550
through 556 and 560 Subchapter B: Mineral Resources; and Proposed Express Terms 6 NYCRR
Parts 750.1 and 750.3 Obtaining a SPDES Permit and High-Volume Hydro Fracturing (HVHF)
that were put out for public comment on September 7, 2011 (hereinafter the “2011 Proposed
Regulations”). In IOGA’s 2012 Comments, which were submitted on or about January 11, 2012,
and are fully incorporated by reference herein (the “2012 Comments”), IOGA identified many of
the same issues that are identified below, including the need for the Department to provide
regulatory flexibility in the final standards such that the Department can meet its balancing
obligations under the State Environmental Quality Review Act and fulfill the mandates of
Environmental Conservation Law (“ECL”) § 23-0301 to promote the greater development of the
oil and gas resources in New York State and to protect the correlative rights of landowners to

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have those resources developed.1 IOGA notes that a complete copy of the 2012 Comments is
being submitted with these comments.

I. Positive changes

IOGA has reviewed the Revised Proposed Regulations in great detail, including the changes
that were made as a result of public comment received during the initial rulemaking. IOGA
wishes to commend the Department for some changes that were made that were partially
responsive to the needs of industry. One example is the flexibility provided by the removal of
the $2 million cap and the addition of an undefined limitation, as determined by the Department,
on bonding requirements for well operators. Although the Department did not accept IOGA’s
suggestion for a financial security test to determine the necessity for bonding, or the adoption of
a specific cap on bonding consistent with levels adopted by other states currently engaging in
HVHF, this change provides the Department the ability to determine an appropriate cap for
bonding requirements on an owner by owner basis. As is more fully detailed below, IOGA
continues to believe that the Department should incorporate a financial assurance test to allow
those companies that are fully capitalized to meet the financial assurance intended by the
Revised Proposed Regulations, without unnecessarily tying up capital for extended periods of
time. This is particularly true with the shale resources, which are anticipated to produce natural
gas for decades. Likewise, the Department should adopt an overall cap on the amount of
financial assurance that is required, per company, to keep New York State competitive with other
shale producing states. As recent experience in New York State and in other states has
demonstrated, these types of limits provide adequate assurance that the wells will be properly
closed without the need to tie up unnecessary capital.

Further, the Department has provided greater clarity to the application process by adding
application procedures at proposed Section 560.3(e). IOGA commends the Department for
providing a 10-day window to determine if the application is “functionally complete,” as this
will move applications along on a predictable schedule. Additionally, processing applications
for additional wells on a well pad associated with wells that have already received a Part 560
permit without additional public notice or comment period will provide for expediency and
efficiency in processing applications. See § 560.3(e)(7).

IOGA also notes that the Revised Proposed Regulations require a “flare approval” instead of
a “flare permit,” which was previously proposed. This will increase efficiency in field
operations, while maintaining Department oversight over any needed flares. See § 556.2(c).

It is acknowledged that the Revised Proposed Regulations modified the documentation
required to demonstrate the “green frac fluid analysis” requirement, both in Part 560 and Part
750-3, by limiting it to “existing data and studies.” See §§ 560.3(d)(1)(viii); 750-3.7(k)(2). This
change will make assessing the chemicals intended for stimulation and preparing applications
more predictable for industry. However, notwithstanding this positive change, industry, after

1
These regulatory requirements are complemented by the corresponding language in the Energy Law, which
requires the State to “foster, encourage and promote the prudent development and wise use of all indigenous state
energy resources including, but not limited to, on-shore oil and natural gas, off-shore oil and natural gas, [and]
natural gas from Devonian shale formations . . . .” New York Energy Law § 3-101(5).

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considerable internal inquiry, has no consensus or definition as to what constitutes a “green”
product. The Department should consider utilizing some of the current available standards for
additives used in other geographic regions, even internationally, such as the “North Sea”
standard that we believe to be the most rigorous standard. Currently, industry believes its
products pass even those stringent requirements. In any event, it is hard to comply with a
standard that has no definition or measurement.

Moreover, the Department continues to require that the “green” frac fluid analysis be
performed for each well permit application. This is unnecessarily burdensome on industry and
does not take into account the significant progress that has been made during the four and one
half years while the revised regulatory standards have been developed in New York in the
improvement of frac fluid chemicals. These improvements have reduced the number and
concentrations of chemicals utilized while enhancing the efficacy of the stimulation process.

II. Provisions Demonstrating the Critical Need for Variances and Regulatory
Flexibility

Although the Department did incorporate some changes to the regulations that are helpful to
industry, in IOGA’s view, there remain significant issues for industry that prevent the Revised
Proposed Regulations from being workable or legal. The net result is that the Revised Proposed
Regulations will discourage development, rather than promoting development as is mandated by
law. The 2011 Proposed Regulations contained numerous protective setbacks that were more
extensive than those included in any other state. See §§ 52.3; 560.4(a)(1)-(5); 560.6(b)(1)(ii);
750-3.3(a)(1)-(6). The setbacks included in the Revised Proposed Regulations have been
expanded upon – both for hydraulic fracturing permits and SPDES permitting. Compounding
this problem, the Revised Proposed Regulations continue to promote extensive prohibitions,
including prohibitions on siting within or near the Syracuse and New York City watersheds and
certain aquifers. See § 750-3.3(a)(1) & (2). The Revised Proposed Regulations further maintain
the additional prohibition in Part 52, which provides that no surface disturbance associated with
drilling a HVHF natural gas well is permitted on any State lands, applicable to both pre-existing
and new leases. See § 52.3. It is noted that this prohibition is the broadest of any setback, as it
prevents any soil disturbance on state lands, which would include access roads, well pad
development, and any other aspect of site development that disturbs land. See id. IOGA
previously commented on the inclusion of this prohibition in the 2012 Comments, and all of its
prior concerns are repeated here.
Simply stated, these prohibitions are without legal authority and inconsistent with the
mandate of the ECL that requires the Department to promote the greater recovery of the resource
and protect the correlative rights of the landowners. ECL § 23-0301. In fact, these prohibitions
amount to a taking of mineral rights without just compensation in violation of constitutional
rights.2 See Lucas v. South Carolina Coastal Council, 505 U.S. 1003, 1015 (1992); Martin
Marietta Materials, Inc. v. City of Carmel, 2007 U.S. Dist. LEXIS 88922 at *41 (S.D. Ind. Nov.

2
No member of IOGA New York is proposing to drill in either the New York City or Syracuse watersheds and
IOGA recognizes the political sensitivity of those areas. However, notwithstanding the political sensitivity, the
Department does not have the authority to ban drilling in any area of the state and any such ban amounts to an illegal
taking of mineral rights without the payment of just compensation.

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28, 2007); Bass Enters. Prod. Co. v. U.S., 381 F.3d 1360, 1364 (Fed. Cir. 2004) (citing Penn
Cent. Transp. Co. v. New York City, 438 U.S. 104, 124-45 (1978)).
Compounding these broad prohibitions are the many setbacks that are proposed, with only
limited variances available to industry. Specifically, the Revised Proposed Regulations include
the following setbacks in Section 560.4:
(a) No well pad or portion of a well pad may be located:

(1) within 500 feet from a residential water well, domestic supply spring
or water well or spring used as a water supply for livestock or crops;
(2) within 500 feet from an inhabited dwelling or place of assembly;
(3) within a primary aquifer and a 500-foot buffer from the boundary of a
primary aquifer;
(4) within a 100-year floodplain; and
(5) within 2,000 feet of any public water supply (municipal or otherwise,
or the boundaries of any public water supply reservoir, natural lake or
man-made impoundment (except engineered impoundments
constructed for fresh water storage associated with fracturing
operations). See also SGEIS § 7.1.11, pp. 7-73.
Importantly, unlike other states that measure setbacks from the wellbore, the setbacks are
from the closest edge of the well pad. Section 560.4(b). And, the Revised Proposed Regulations
include a variance for only two of the five broad setback provisions (for (a)(1) and (a)(2)).
Additionally, before the Department can even consider a variance, the applicant must obtain
landowner and (as applicable) tenant consent for the variance.
Some of the newly proposed setbacks have substantive problems. The Revised Proposed
Regulations include a new setback on water supplies for crops and livestock, which was not
discussed in the SGEIS, and which further restricts where sites may be located. See SGEIS
Executive Summary p. 22. Further, the term “crops” and “water supply” are not defined, making
the requirement vague. IOGA recommends deleting or at a minimum, defining these terms.
With regard to testing in Section 560.5(d)(1), water used for irrigation purposes is not commonly
isolated as applicable sources to be tested in other states and the sources can be difficult to
locate, because they may be as simple as a waterhole dug by a farmer.
Section 560.6(b)(1)(ii) contains an additional setback that will restrict available areas to
locate well pads, which provides that “fueling tanks must not be placed within 500 feet of a
perennial or intermittent stream, storm drain, regulated wetland, lake or pond.” In removing the
“to the extent practical” that existed in the 2011 Proposed Regulations, the Revised Proposed
Regulations actually decrease flexibility in siting well pads. This provision is likely to severely
further restrict recoverable unconventional shale resources as it is possible that well pads cannot
be properly designed to meet the various requirements contained in the Revised Proposed
Regulations as well as this buffer, particularly with no variance provision. Additionally, it is
possible that a hazard could be created because tanks may have to be placed in other areas than

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where they normally are placed, resulting in more fuel transfers and the potential for spills and
accidents.

In addition to the setbacks contained in Part 560, the proposed Part 750-3 contains
additional setbacks at Section 750-3.3, providing:

Well pads for HVHF operations are prohibited, and no SPDES permit will be
issued authorizing any such activity or discharge:

(1) within 4,000 feet of, and including, an unfiltered surface drinking
water supply watersheds;
(2) within 500 feet of, and including, a primary aquifer;
(3) within 100-year floodplains;
(4) within 2,000 feet of any public (municipal or otherwise) drinking water
supply well, reservoir, natural lake, man-made impoundment, or
spring; and (See also SGEIS Section 7.1.11, pp.7-73.)
(5) within 2,000 feet around a public (municipal or otherwise) drinking
water supply intake in flowing water with an additional prohibition of
1,000 feet on each side of the main flowing waterbody and any
upstream tributary to that waterbody for a distance of one mile from
the public drinking water supply intake; and (See also SGEIS Section
7.1.11, pp.7-73.)
(6) within 500 feet of a private water well or domestic use spring, or water
supply for crops or livestock, unless the Department has granted a
variance from the setback pursuant to subparagraph 560.4(c) of this
Title, adopted on XX, 20XX.
Again, the setbacks are measured from the closest edge of the well pad, not the wellbore
as is common in other states. See § 750-3.3(b). More troublesome is the fact that a number of
these setbacks are redundant with setbacks contained in proposed Part 560 and, therefore, should
be deleted or a reference to Part 560 incorporated in Section 750-3.3. See, e.g. §§ 560.4(a)(3);
750-3.3(a)(2) (providing setback of 500 feet from, and including, a primary aquifer); §§
560.4(a)(4) 750-3.3(a)(3) (prohibiting siting within floodplains). Others within Section 750-3.3
are slightly varied from those contained in Part 560, but are similar enough that, at a minimum,
confusion over the application will result. See § 750-3.3(a)(4) (similar to Section 560.4(a)(5)); §
750-3.3(a)(6)(similar to Section 560.4(a)(1)). It is also likely that, especially in the absence of a
variance provision, an overly broad reading of the setbacks will be imposed to further restrict
available drilling areas. Indeed, only one category (Section 750-3.3(a)(6)) of the six setbacks
contained in Section 750-3.3 contemplate a variance.
The Department must streamline these inconsistent provisions and, if no revisions are
made, must provide a rationale for why these slight variants are needed in Section 750-3.3(a)
versus the identical or nearly identical setbacks contained in Section 560.4, as well as what these
variants will accomplish. IOGA attaches as Exhibit A proposed revised regulations, including a

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proposed revised Section 750-3.3, streamlining the setbacks and allowing a variance consistent
with those provided in Section 560.4. Additionally, an updated Section 560.4, acknowledging
the revisions to Section 750-3.3 is also included within the attached Exhibit A.
Proposed Section 750-3.5(c)(1) presents an additional limitation that will eliminate
eligibility for an exemption from SPDES permitting requirements contained in proposed Section
750-3.5(b) for many sites. The provision provides:
(c) At a minimum, in order for the department to make a determination that the injection
will not result in the degradation of ground or surface water resources pursuant to
paragraph 750-3.5(b)(2) of this Part:
(1) the top of the target fracture zone, at any point along any part of the proposed
length of the wellbore, for HVHF must be deeper than 2,000 feet below the
ground surface and must be deeper than 1,000 feet below the base of a known
freshwater supply; and
(2) the owner or operator must have measures in place to ensure compliance with the
requirements of paragraphs 750-3.7(k)(1), (2), (3), (4), (6), and (7) of this Part and
subdivisions 750-3.7(l), (m), and (n) of this Part.
In addition to these general disqualifiers, the proposed SPDES general permit for HVHF
operations is unavailable for sites located in certain buffer areas:
(1) within 500 feet of a principal aquifer
(2) within 300 feet of a state or federal wetland;
(3) within 300 feet of perennial or intermittent streams, as described in Parts 800-941 of
this Title, storm drains, lakes or ponds.” See § 750-3.11(d); see also SGEIS § 7.1.11,
pp.7-73.
Finally, all of these buffers and setbacks are supplemented with the revised draft SGEIS
published in 2011,3 which includes as proposed mitigation a number of other prohibitions on
areas where drilling may occur:
(1) Prohibition on HVHF construction and drilling activities occurring in contiguous
grassland habitat of 30 acres or more during nesting season of grassland birds for
“Grassland Focus Areas” See SGEIS Executive Summary p. 24; see also SGEIS §
7.4.1.2, pp. 7-79-82.
(2) Site specific ecological assessment and implementation of mitigation measures for
HVHF activities in contiguous forest patches of 150 acres or more in “Forest Focus
Areas.” See SGEIS Executive Summary p. 24; see also SGEIS § 7.4.1, pp. 7-83-87.

3
Of course, IOGA has no way of knowing whether additional restrictions have been added to the SGEIS since its
last publication in 2011. If additional restrictions and/or setbacks are included with the final SGEIS, these problems
will be compounded even further.

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(3) Site specific EIS required for HVHF on “principal aquifers” or within a 500 foot
buffer outside of “principal aquifers.” SGEIS Executive Summary p. 21; see also
SGEIS § 7.1.11, pp.7-73.
Given the breadth and extent of setbacks that were originally proposed, industry is
concerned that yet further setbacks and prohibitions have been added to the Revised Proposed
Regulations. Industry is particularly concerned because there is a complete absence of any
factual basis for most of the setbacks as well for the extensiveness of the setbacks in the Revised
Proposed Regulations or the SGEIS. Indeed, industry’s proven track record would support lesser
regulation, not further, more stringent prohibitions as has occurred in the Revised Proposed
Regulations.

In IOGA’s view, the prohibitions on siting within a primary aquifer and a 100 year
floodplain are unnecessary. Industry has an excellent track record of drilling within primary
aquifers for many years without incident which would support allowing drilling in these areas.
Further, the prohibition on 100 year floodplains is unneeded. Operators in other states routinely
drill in floodplain areas, with effective, proven contingency methods that avoid incident during
floods. In fact, the experience of the natural gas industry in the Northeast during tropical storm
Irene demonstrated that the natural gas industry is more than capable of dealing with severe
flood conditions. There were no incidents reported at natural gas sites. In a similar vein, IOGA
opposes the requirement for a specific EIS for principal aquifers. Like primary aquifers, industry
has decades of experience drilling in these areas without incident.

It is also evident from the paltry regulatory support documents putatively prepared in
compliance with SAPA that the Department has not considered other factors in proposing these
extensive prohibitions and setbacks. Two factors that are highly relevant to the location of well
pads include terrain and the availability of surface rights. Terrain is an obvious issue that needs
little explanation.4 The Southern Tier where most of the shale development will occur is an area
of the state that has hilly terrain, with steep slopes and limited areas that are suitable for well
pads. There is nothing in any of the analysis put forth by the Department that indicates that the
Department has considered this limitation in relation to the prohibitions and setbacks that have
been proposed. Likewise, it is very common in New York State for landowners to restrict or
prohibit surface access as part of an oil and gas lease. Yet, there is nothing in the regulatory
support documents that indicates that the Department considered this limitation in relation to the
prohibitions and setbacks. As a consequence, the Revised Proposed Regulations will make it
extremely difficult, if not impossible, to find proposed well pad locations when all of the
prohibitions and setbacks are factored in with limitations created by to terrain and surface rights.

Of greatest concern to the industry is the failure of the Department in the Revised
Proposed Regulations to include a general variance provision or waivers to provide regulatory
flexibility. Simply put, industry cannot operate under a regulatory scheme that does not provide
substantially greater flexibility, including a broad variance provision. In sharp contrast to the
way the Department is proposing to regulate the oil and gas industry, the Department has enacted
more than 40 separate regulatory provisions across numerous programs it administers, each of

4
The Department is obviously aware of the significant slopes in the Southern Tier and has also proposed a
disqualification from obtaining a general permit in certain areas with steep slopes. See proposed §750 –
3.11(f)(2)(iii).

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which that allow applicants to vary or modify the governing regulations. Attached as Exhibit B
is a listing of these regulations.

Many of these provisions, if not the majority, are a general variance authorization
allowing “any provision” of the regulatory program to be varied provided environmental
standards can be met. Such general variances are provided for many industries whose sole
purpose is to handle waste, and on a permanent basis, including hazardous and radioactive waste,
both during transport and at waste management facilities. See 6 NYCRR § 360-1.7 (allowing
variance for solid waste management facilities); 6 NYCRR § 361.1(allowing variance for
hazardous waste disposal facilities); 6 NYCRR § 364.1 (allowing variance for solid waste
transporters); 6 NYCRR § 370.3 (allowing variances for hazardous waste management
systems); 6 NYCRR § 373-1.1(allowing variances for hazardous waste treatment, storage and
disposal facilities); Id. at 373-3.10(allowing variances for owners and operators of hazardous
waste facilities); 6 NYCRR § at 376.1 (allowing variances for hazardous waste land disposal); 6
NYCRR § 376.4 (allowing variances from treatment standards required for treatment of
hazardous waste); 6 NYCRR § 380-3.5 (allowing variances for discharge and disposal of
radioactive material to the environment); 6 NYCRR § 381.8 (allowing variances for transport of
low level radioactive waste); 6 NYCRR § 382.4 (allowing variances for low level radioactive
waste disposal facilities). Petroleum storage facilities are also provided a general variance
provision. See 6 NYCRR 614.1. Indeed, even as part of remediating suspected or known
contaminated sites as part of the Brownfield Cleanup Program the Department allows variation
from a strict cleanup standard to suit a particular site. See 6 NYCRR §375-3.8(e)(4); see also 6
NYCRR § 375-1.8 (allowing flexibility in remedial programs).

It is evident that even where, by statute, a substance is designated hazardous, radioactive,
or otherwise a contamination risk, the Department has consistently included a flexible variance
provision allowing site-specific standards that are protective of the environment. And yet, for
HVHF, a temporary process with numerous safeguards included in the practice and required by
the evolving regulatory standards, virtually no variance provisions are provided. There is
demonstrably absent a general variance provision such as is provided for the solid, hazardous
and radioactive waste industries, despite the critical need for one in light of the numerous
setbacks and prohibitions the HVHF industry must follow. The Department has provided no
rationale for its disparate treatment of HVHF, an industry whose practices present substantially
fewer risks to the environment than industries involved in management, transport and disposal of
solid waste, hazardous waste, radioactive waste, and petroleum - all industries with a long
history of discharges to the environment and corresponding environmental contamination –
whose regulations contain generous variance provisions.

As the Department is well aware, the oil and gas industry has an excellent track record in
New York State, both in terms of developing deep wells and hydraulically fracturing many wells,
without any significant adverse environmental impacts. Although HVHF presents some
additional challenges, those challenges are more than adequately managed through the extremely
robust regulatory program that is being created under the SGEIS and the Revised Proposed
Regulations. There is simply no justification for treating the oil and gas industry differently than
virtually every other industry that is regulated by the Department. This is particularly so with the
numerous prohibitions and setbacks that have been proposed, which will, absent the variance

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provision, render much of the state off-limits to oil and gas development. A proposed variance
provision for Part 560 and for Part 750-3 is included in Exhibit A.

Additionally, these proposed setbacks and prohibitions are arbitrary and capricious
because the draft SGEIS5 does not provide data or other record support for the scope of the
restrictions that the Department has proposed. Indeed, even in its response to comments the
Department provides no basis for the setbacks and the need to expand them. Previous comments
from industry have pointed out that the proposed setbacks vastly exceed those required by other
states and the Department fails to provide a reasoned basis for asserting that those setbacks are
inadequate. Such a failure renders the Revised Proposed Regulations arbitrary and capricious,
and subject to annulment. See New York State Ass’n of Counties v. Axelrod, 78 N.Y.2d 158,
166-69 (1991) (finding regulations lacked rational basis because of lack of evidence in the record
supporting across the board increase in cost); see also Law Enforcement Officers Union, Dist.
Council 82, AFSCME, AFL-CIO v. State, 229 A.D.2d 286, 291 (3d Dep’t 1997) (finding single
housing regulation arbitrary and capricious because it contains a minimum square footage
requirement while double occupancy housing does not contain such a requirement). The Court
of Appeals in New York State Association of Counties cited the often-repeated general rule that
“an administrative regulation will be upheld only if it has a rational basis, and is not
unreasonable, arbitrary or capricious.” New York State Ass’n of Counties, 78 N.Y.2d at 166.
The Revised Proposed Regulations do not provide record support for a number of the proposed
setbacks and, in particular, for the increases to setbacks previously included in the 2011
Proposed Regulations. In the absence of this explanation, the Revised Proposed Regulations
could not stand judicial challenge.

Compounding this arbitrary and capricious treatment of the oil and gas industry, the
Revised Proposed Regulations impermissibly assert state jurisdiction over federal wetlands with
the consequence that it will be extremely difficult, if not impossible, to site well pads and access
roads. As noted above, Section 750-3.11(d) of the Revised Proposed Regulations disqualifies an
operator from obtaining the general stormwater permit if any activities are located within 300
feet of a federal wetland. (The Revised Proposed Regulations now include a definition for
“wetland” applicable to Part 750-3. See § 750-3.2(b)(54) (defining wetland as “any area
regulated pursuant to Article 24 of the Environmental Conservation Law and any other wetlands
regulated under Section 404 of 33 U.S.C. 1251 et seq.”). Initially, IOGA questions the legal
authority of the Department to include within the definition of “wetland” wetlands that qualify as
federal wetlands. As the Department is well aware, the limits of the Department’s jurisdiction
regarding wetlands are detailed in ECL Article 24. This effort to incorporate federal wetlands
into the regulatory definition is, therefore, ultra vires.6

The buffer contained in Section 750-3.11(d), which is three times greater than that
established by statute for New York regulated freshwater wetlands generally, unduly restricts
and complicates development of the Marcellus shale resource. See ECL 24-0701(2). Since
federal regulations have no minimum acreage requirement and can be often found as ruts in old

5
See Footnote 3, above.
6
Industry acknowledges its requirements to comply with federal laws regarding potential impacts to wetlands that
are jurisdictional under those laws. As in the past, industry will continue to work with the United States Army Corps
of Engineers concerning any permits or approvals that are necessary.

9

logging roads and the like, this potential proposed setback could have devastating consequences
on the development of the shale resources in New York. Indeed, substantial additional areas of
the Marcellus shale will now be foreclosed from development through use of the HVHF SPDES
General Permit, and operators would have to expend significant additional time and money on an
individual SPDES permitting process, which could ultimately result in adjudicatory hearings and
a waste of the resource in contravention of ECL 23-0301. With these new buffers and the
additional setbacks contained elsewhere in the Revised Proposed Regulations, the already greatly
reduced available areas, which were previously estimated to make approximately 50% of the
resource off-limits to development, are further restricted such that it will be difficult for any
company to justify an investment in New York. As mentioned above, a variance provision is
desperately needed to avoid lengthy cost and delay in permitting and this illegal extension of the
Department’s jurisdiction over wetlands should be eliminated from the Revised Proposed
Regulations entirely.

In addition, there is a fundamental unfairness to this restriction. No other SPDES
General Permit imposes a 300 foot restriction based on proximity to wetlands or any other water
resource. Indeed, the one general permit that includes any buffer at all includes only a 100 foot
buffer, applicable to the actual deposit of waste on the ground near the wetland, in stark contrast
to HVHF operations, which may only discharge stormwater. The other five SPDES general
permits contain no wetland or similar buffers, including, notably, the SPDES construction permit
for well drilling activities issued April 1, 2010. See SPDES General Permit for Stormwater
Discharges from Construction Activity (GP-0-10-001) Requirements for Well Drilling Activities,
NYS Dep’t of Environmental Conservation (Apr. 1, 2010), available at
http://www.dec.ny.gov/docs/water_pdf/welldrilling.pdf. Therefore, any other applicant or
industry could place their operations 100 feet from a New York-regulated wetland with no
wetland or other permit, while, at the same time, that applicant could utilize the SPDES General
Permit. The same unfairness exists for those projects proposed to be developed in a portion of
the wetland, which could use the state freshwater wetland permitting program. Indeed, no other
industry subject to Department regulation must comply with a flat prohibition relating to
wetlands. (And, to the extent any buffers exist, those other programs could obtain a variance in
relation to the buffer). This regulatory prohibition prevents solely the HVHF industry from
using a SPDES general permit while being located near a wetland, and restricts the ability of the
HVHF industry to utilize the existing statutory freshwater wetland permit program to develop
sites.

Additionally, with respect to federal wetlands, any other industry could develop as close
as directly adjacent to the wetland with no wetland permit, and still utilize a NY SPDES General
Permit. No other Department program attempts to usurp or piggyback on Federal permitting
authority and then compound this illegal extension of its regulatory authority with an excessive
buffer. Indeed, 6 NYCRR § 360-2.12(c)(8) shows proper deference to the governing federal
agency in prohibiting siting landfills in federal wetlands unless an Army Corps of Engineers
(“ACOE”) permit is obtained, and requiring consideration of alternatives, but only to the extent
“required under federal or State law.” The Revised Proposed Regulations should similarly
recognize the authority of the ACOE to determine proper regulation of the wetlands under its
jurisdiction. Since the Revised Proposed Regulations seek to impose a buffer zone on federal

10

wetlands, where none exists at federal law, not only does this extend the Department’s
jurisdiction impermissibly, but it conflicts with the Clean Water Act.

More specifically, in the absence of this restriction by the Department, a number of
Nationwide Permits (“NWP”) exist that would allow HVHF operations to discharge into or even
disturb federal wetlands while also using the SPDES General Permit. For example, the ACOE
includes in its Nationwide Permit Program a specific NWP for construction or modification of
outfall and associated intake structures. See Army Corps. of US Engineers, 2012 Nationwide
Permits, Conditions, District Engineer’s Decision, Further Information, and Definitions (with
corrections), Permit #7 (2012), available at http://www.usace.army.mil/Missions/CivilWorks/
RegulatoryProgramandPermits/NationwidePermits.aspx. The ACOE has also authorized up to a
one-half acre loss of waters of the United States for the purpose of placing utility lines, including
pipelines carrying natural gas. See id. at Permit #12. There are a number of other permits that,
absent this substantial prohibition, an HVHF operator could utilize to develop its well pad. See
id. at Permit #18 (authorizing minor discharges of dredged or fill material into up to one-tenth of
an acre of federal wetlands); see also id. at Permit #19 (allowing up to 25 cubic yards of
dredging in waters of the United States); see also id. at Permit #33 (authorizing temporary
structures, work, and discharges, necessary for construction activities, access fills or dewatering
of construction sites); see also id. at Permit #43 (permitting discharges of dredged or fill material
to construct storm water management facilities).

Even assuming it is legally permissible for the Department to infringe upon a federal
agency’s regulatory authority in this way, it is confusing to the extreme that the Department
would prohibit HVHF operations within 300 feet from wetlands from using a SPDES General
Permit when the very Federal agency regulating them has determined those sites may be
disturbed or impacted using the expedited NWP process. Beyond these numerous NWP avenues
ordinarily available to an applicant, an individual permit could also normally be applied for. The
proposed 300 foot buffer, therefore, also forecloses the HVHF industry from utilizing an existing
federal statutory scheme to develop its property in an efficient manner which minimizes the
regulatory burden. What this means is that an HVHF operator could obtain an approval from the
ACOE to disturb wetlands to build its well pad, to then have the Department require an
individual SPDES permit application, which would subject an operator to unnecessary,
protracted proceedings, and which could ultimately preclude development, all on the basis of this
excessive 300 foot buffer.

Critically, the Department’s actions in engulfing all of the wetlands regulated by separate
Federal agencies deprive the various Federal agencies charged by law with regulating these
wetlands the opportunity to exercise that authority. This provision must be deleted, or at least
modified to, at a minimum, remove the federal wetlands subject to other agencies’ review from
the scope of “wetlands” subject to the buffer. Additionally, in the absence of a demonstration as
to why a buffer three times the size of the statutory buffer surrounding New York regulated
wetlands is necessary for use of the proposed HVHF SPDES General Permit, the 300 foot buffer
should be rejected and the 100 foot buffer applicable to New York regulated wetlands in general
reinstated. Since the 100 foot buffer zone is established by statute (ECL §24-0701(2)), this is yet
a further example of where the Department has engaged in ultra vires activities.

11

III. State Administrative Procedures Act (SAPA) Issues

As IOGA commented previously in its 2012 Comments, the 2011 Proposed Regulations,
and the related Regulatory Impact Statement (“RIS”) and Regulatory Flexibility Analysis
(“RFA”) fail to comply with a number of the mandates of SAPA. Several defects continue to
exist in the current Revised Regulatory Impact Statement (“RRIS”) and the Revised Regulatory
Flexibility Analysis (“RRFA”) issued in conjunction with the Revised Proposed Regulations.
Indeed, some of the defects have worsened.

IOGA previously submitted substantial comments regarding the essential requirement
that the RIS detail the significant financial costs to industry to comply with the 2011 Proposed
Regulations. See SAPA 202-a (3)(c)(i) & (iii). To aid with this effort, IOGA provided an
assessment of the permitting and planning costs associated with the 2011 Proposed Regulations.
The RRIS acknowledges receipt of these costs, but largely reports the numbers as speculative
and excessive, without documentation to support that claim. The RRIS notes some attempts that
were made to obtain more information; however, it fails to provide “a statement setting forth its
best estimate” in the absence of an analysis of costs as required by SAPA 202-a(3)(c)(iv).
Rather than complying with these statutory requirements and either accepting the cost analyses
provided by industry or documenting meaningful alternative numbers, the Department bootstraps
this issue by asserting that the cost will include the “potential costs that the regulated community
should have expected from the mitigation measures and/or permit conditions that have been
identified in the rdSGEIS.” NYS Dep’t of Environmental Conservation, Revised Regulatory
Impact Statement: High-Volume Hydraulic Fracturing - 6 NYCRR Parts 52, 190, 550-556, 560,
and 750, Proposed Regulations (2013); available at
http://www.dec.ny.gov/regulations/87440.html.

This position fails to recognize that the Revised Proposed Regulations and the mitigation
standards being developed under the SGEIS are being developed in tandem, on a parallel track.
If the Department’s position were true, there never would be a requirement to assess the cost of
new regulations if those regulations are evaluated under the State Environmental Quality Review
Act. This, of course, is not true. Accordingly, the RRIS and related documents utterly fail to
provide a quantifiable best estimate of cost to demonstrate “the cost for the implementation of,
and continuing compliance with, the rule to regulated persons.” See RRIS; SAPA § 202-
a(3)(c)(i). Without this estimate, the enactment of the Revised Proposed Regulations violates
SAPA. More importantly, there is no assessment of the cost to comply with the Revised
Proposed Regulations or a meaningful basis to assess less costly alternatives for industry.
Accordingly, the Department has failed to comply with a number of statutory mandates of
SAPA, including those mandates which require that agencies minimize the cost to small
businesses.

IOGA also notes that its prior estimate of cost is likely inaccurate now, as the Revised
Proposed Regulations include a number of new regulatory requirements that will impose
additional cost on the regulated community. As just one example out of a number of new
requirements imposing cost, additional water sampling is now required, both for baseline
analysis (including an increase in the number of sources that must be tested, as well as the
parameters to be tested for), and flowback and production brine. This sampling will generate
new costs not previously assessed by IOGA and, critically, not addressed by the Department in
12

the RRIS. This violates SAPA. Likewise, the Department has not provided any meaningful
analysis of the cost to develop all of the plans that are required to support permit applications.
These regulatory omissions must be corrected. When these direct costs are included with the
indirect costs incurred in the many areas of the state that will be off limits to development,
resulting in loss of investment in the leases, geologic assessments and the like, the conclusion is
inescapable that the Department has violated SAPA. (To say nothing of the staggering cost of
compliance with the Revised Proposed Regulations).

Additionally, the Revised Proposed Regulations now contain a requirement that applicants
for HVHF well permits “pay all permit fees required under the Environmental Conservation
Law” and that the “applicant . . . pay any costs assessed by the department pursuant to section 8-
0109(7) of the Environmental Conservation Law and . . . sections 617.13 and 618.1” of 6
NYCRR. See § 560.3(f). Although 6 NYCRR Section 617.13 putatively allows the Department
to recoup its costs in preparing or reviewing an EIS, including “a chargeback to recover a
proportion of the lead agency's actual costs expended for the preparation of a generic EIS,” this
is the first time that the Department has announced its intention to assess these costs against
industry. Notably, even though the process to develop the SGEIS has been pending for
approximately four and one-half years, the Department never raised this issue publicly. As such,
the Department should be estopped from asserting these costs retroactively at this point in the
process. In addition, the RRIS fails to specify any estimate of the actual costs the Department
has expended in preparing the SGEIS, and has failed to provide any indication of how the costs
to each applicant will be determined and assessed. As the costs to prepare the SGEIS are
uniquely within the Department’s knowledge, omitting this information in its assessment of costs
to industry in the RRIS cannot pass muster under SAPA. Indeed, the RRIS does not even
mention that there is a cost associated with this new application fee requirement, or any of the
other new costs the Revised Proposed Regulations include.

Lastly, the proposal to assert SEQRA fees through 6 NYCRR §§ 617.13 and 618.1 does not
even acknowledge the limits on those costs provided in the Department’s own SEQRA
regulations. As provided in the regulations, those costs are limited to a percentage of
development and other costs set forth in Section 617.13(b), (c) and (d). Of course, the
Department is required to follow its own regulations. See Era Steel Constr. Corp. v. Egan, 145
A.D.2d 795, 799 (3d Dep’t 1988). Particularly relevant here is subparagraph (d), which limits
costs associated with applications regulated under the minerals program. Since the oil and gas
program is part of the minerals program, the Department is limited by subparagraph (d) in the
amount that can be charged to each applicant. Under that regulatory provision, each applicant
could be charged a maximum fee for each unit developed based upon a percentage of the total
cost to develop the well pad and the access road, and the cost to run any utilities, if any, to the
well pad. IOGA is willing to accept this limitation as a compromise concerning this issue. Those
costs could be charged against the initial permit or permits that are part of the application leading
to the development of the well pad and access road within the unit established by the initial
permit application. Thereafter, no additional fees would be assessed against infill wells drilled
from the common well pad.

In addition to the violations noted above, SAPA Section 202-a(3)(g) requires a discussion of
alternatives and the reasons why those alternatives were not incorporated into the rule. IOGA

13

previously commented that the RIS is required to have sufficient discussion of alternatives, and
that the RIS failed to do this, which was particularly egregious given the significant costs being
imposed on the regulated community and the failure of the Department to incorporate regulatory
flexibility into the Revised Proposed Regulations. Additionally, IOGA noted that its “comments
identify a number of less costly alternatives to avoid and/or minimize” impacts to the regulated
community, including small businesses. 2012 Comments, Tab 3, p.3. The RRIS fails to
acknowledge that any alternatives were suggested in public comment, particularly by the
industry to be regulated, and instead continues to rely on the limited no-action alternative and the
‘denial of permits’ alternative. This violates SAPA. A significant evaluation of additional, less
costly alternatives is required to properly finalize and adopt the Revised Proposed Regulations.
Once again, IOGA is submitting proposed changes to the Revised Proposed Regulations that will
accomplish the Department’s goal of protecting the environment while providing the industry
with necessary flexibility. Should the Department fail to adopt these changes, it will be, yet
again, in further violation of SAPA.

Perhaps the most egregious violation of SAPA is the failure of the Department to
acknowledge the significant regulatory impacts on small businesses and to identify measures to
minimize those impacts. As the Department is well aware, SAPA contains a requirement for the
Department to prepare a regulatory flexibility analysis. See SAPA § 202–b(2). IOGA
previously commented that the RFA failed to consider impacts to small businesses engaging in
HVHF as required by SAPA. IOGA additionally provided letters from ten (10) separate
companies intending to engage in HVHF operations in New York that meet SAPA’s definition of
“small business.” Notably, at least eight (8) of those letters were from operators who identified
their prior investments that were intended to develop shale resources in New York State, which
are in jeopardy, or were going to be sold because of the significant regulatory cost and burden
included in the 2011 Proposed Regulations.7 Each letter discussed the impacts that will be
experienced by that small business and many asked that the Department provide further review
of the impact to small businesses and propose alternative, less costly requirements to allow small
businesses to be competitive in the HVHF field. Several of the letters also emphatically stated
that their businesses and the oil and gas industry in general, will be forced to stop doing business
in New York if the regulatory requirements remain as burdensome as then proposed.

The RRFA does not acknowledge any of these comments or the many other comments that
have been received from small businesses. Instead, the RRFA outright states that “it is not
expected that small businesses . . . will be engaged in HVHF itself.” See NYS Dep’t of
Environmental Conservation, Revised Regulatory Flexibility Analysis for Small Businesses &
Local Governments, p. 4 (2012), available at http://www.dec.ny.gov/docs/administration_pdf/
rhvhfrfa2.pdf. This statement patently false, as is demonstrated by the small business letters
attached to the 2012 Comments and the new small business letters that are attached to these
comments. See Exhibit C, attached. Notably, any impacts to small businesses that were reported
in the 2012 Comments have increased, as the Revised Proposed Regulations include a number of
new requirements that will increase costs experienced by small businesses. The Revised
Proposed Regulations, therefore, place an enormous new burden on small businesses,
particularly those that intend to engage in HVHF operations (such as the companies who

7
New small business letters are attached as Exhibit C, which includes letters from many of the same companies that
provided letters in support of the 2012 Comments.

14

previously commented), which requires that the RRFA make an effort to determine the impacts
to those businesses.

Accordingly, the RRFA is defective in its failure to consider any of these impacts to small
businesses that may engage in HVHF operations. This is a direct result of the failure of the
Department to acknowledge that small businesses will be impacted by the Revised Proposed
Regulations and to provide regulatory flexibility in the revised proposal to minimize the impact
to small businesses. Of course, the Department can still make revisions to the Revised Proposed
Regulations to incorporate regulatory flexibility and, therefore, minimize the impact to small
businesses. The best example is the need to provide general variance provisions, similar to the
variance provisions in the many other regulatory programs administered by the Department,
consistent with IOGA’s comments above. Also, the Department must eliminate a number of the
regulatory proposals identified above that clearly are in excess of the jurisdiction of the
Department.

IV. Technical Comments

a. 551.6 – Financial Security

As mentioned above, IOGA acknowledges the amendment to proposed Section 551.6 to
specify that the Department will approve a bonding cap for each owner. However, IOGA
previously cited bonding levels of $15,000 to $60,000 for Ohio and West Virginia, with
Pennsylvania considering a blanket bonding cap of $600,000. West Virginia ultimately adopted
a bonding limit of $250,000 in Pennsylvania adopted a bonding limit of $600,000. The
Department did not acknowledge the expertise of its sister states currently engaging in HVHF.
Further, this proposed regulation provides financial uncertainty for industry, as they will not be
able to reliably predict the capital requirements for a particular permit requirement with no
indication whatsoever of the bonding the Department may impose. This uncertainty also violates
SAPA, as discussed above. It warrants noting that the Department includes a variance procedure
in at least two other regulatory programs (hazardous and radioactive waste) to allow an applicant
to demonstrate financial responsibility and thereby be relieved from excessive financial
assurances. See 6 NYCRR § 373-2.8 (allowing a variance from financial assurance requirements
under the hazardous waste treatment, storage and disposal facilities program); see also 6
NYCRR § 3.8 (allowing a variance from financial assurance requirements for hazardous waste
facilities); see also 6 NYCRR § 383-1.5 (providing procedure for variance from financial
assurance requirements for low-level radioactive waste disposal facilities); see also 6 NYCRR §
383-6.11 (providing for variance from financial assurance requirements for radioactive waste
land disposal facilities). A similar program could be incorporated in the Revised Proposed
Regulations.

Therefore, IOGA encourages the Department to adopt a reasonable cap on bonding
consistent with other states, and with the requirements of SAPA, including, as previously
requested in IOGA’s comments, a financial test for financial security.

15

b. Part 553 – Well Spacing Requirements

IOGA commends the Department for continuing to include a variance provision in the
well spacing provisions, consistent with the recognition in the statute that nonconforming units
should be available to operators. ECL § 23-0503(3). However, the Proposed Revised
Regulations do not go far enough in that they do not incorporate the statutory standards set forth
in ECL § 23-0503(3) for establishing a unit that does not conform to statewide spacing.
Recommended additions are set forth in the IOGA revisions to the Revised Proposed
Regulations. See Exhibit A. Many operators believe that when prudent planning and efficient
resource development considerations are put into effect together with the many restrictions and
setbacks that are proposed by the Department and the natural limitations of terrain and
landowners’ restrictions to surface access that it will be necessary to propose nonconforming
units and to propose wellbore paths that do not conform to the requirement to centralize the
initial wellbore. Accordingly, these variance provisions will be important to determining
whether the development of deep shale resources can be conducted in New York on a practical,
operable or profitable basis.

c. 554.1(c)(1) Recycling to the “Maximum Extent Feasible”

The Department modified proposed Section 554.1(c)(1) from the 2011 Proposed
Regulations to incorporate changes that could create significant additional costs and regulatory
burdens upon industry. The 2011 Proposed Regulations based the requirement to prepare a fluid
disposal plan on whether there is a “probability . . . that brine, salt water or other polluting fluids
will be produced or obtained . . . in sufficient quantities to be deleterious to the surrounding
environment.” Now, the Department has removed that limitation. Instead, a fluid
disposition/disposal plan is required for all permit applications, as well as “any operation
reported to the department on the Sundry Well Notice and Report form that requires pre-approval
from the department.” See § 554.1(c)(1). This makes no distinction for de minimus generation
of materials required for disposal, particularly for the Sundry Well Notice and Report form
requirement, which may involve changes that do not generate waste, and yet a fluid disposal plan
would be required.

Further, the spectrum of materials that must be managed in the plan has greatly increased.
Previously, the Department proposed to require disposal plan for “fluids.” Now, the Department
has increased this to include “used drilling mud, flowback water, and production brine.” Id.
Additionally, this proposed regulation now contains a requirement that “[t]he owner or operator [
] state in its plan that it will maximize the reuse and/or recycling of used drilling mud, flowback
water and production brine to the maximum extent feasible.” Id. While industry embraces reuse
and/or recycling of materials resulting from the HVHF process, requiring reuse and/or recycling
“to the maximum extent feasible” places an unclear and unmanageable burden on industry that
could create frequent challenges to the sufficiency of a fluid disposition/disposal plan. Such a
standard does not take cost or practicality into consideration, as various recycling or reuse
methods may technically be “feasible,” but may be cost-prohibitive, or may generate impacts
greater than disposal methods that do not involve recycling or reuse; e.g., some of the recycling
technologies employ significant amounts of energy. In sum, this language is too absolute, and

16

would require an operator to follow what is viewed as the maximum reuse/recycling solution,
regardless of cost. This is an unreasonable burden to impose on industry and is yet another
example of where the Department has crafted the Revised Proposed Regulations in a manner that
is too restrictive and without the required regulatory flexibility.

To address the unreasonableness of the requirement that recycling and/or reuse of used
drilling mud, flowback water and production brine be to the “maximum extent feasible,” while
still accomplishing the goal to recycle and/or reuse materials as often as possible, IOGA has
prepared suggested revisions to Section 554.1(c)(1) in the attached Exhibit A.

d. 556.2(b), (c); 560.6(c)(28)(29); EPA NSPS, 40 CFR 60 Subpart OOOO
Flaring Issues

The Department made some revisions to various proposed regulatory provisions
governing potential air emissions related to the HVHF process. See, e.g. 6 NYCRR §§ 556.2(b),
(c), 560.6(c)(28), (29). The Revised Proposed Regulations require that venting gas during
flowback must be through a 30 foot flare stack (unless previous wells show no hydrogen sulfide
in the gas) and must be ignited “whenever possible.” § 560.6(c)(28). The stack must have a self
igniting device. Id. The Revised Proposed Regulations also require that reduced emissions
completions, with minimal venting and flaring, must be preformed if the infrastructure is in place
to transport or market the gas.

Over this past summer and fall the United States Environmental Protection Agency
(EPA) proposed and adopted New Source Performance Standards (NSPS) for oil and gas wells
including those that are completed using hydraulic fracturing unless more stringent state or local
regulations are in place. “The rule covers any gas well that is an onshore well drilled principally
for production of natural gas.’’ (Federal Register August 16, 2012; 77 FR 49490) This
regulation became effective October 15, 2012. The federal regulations will be more stringent
than the Revised Proposed Regulations as of January 1, 2015, except for the New York flowback
and workover regulations at 6 NYCRR Part 556.2(b). Until this date, under the federal
regulations, the owners/operators have the option of using reduced emissions completions
(RECs) or completion combustion devices (with a continuous ignition source), the same as is
required in the Revised Proposed Regulations. The federal regulations encourage the use of
REC and complete combustion devices in the interim. For fractured and refractured gas wells,
the federal rule generally requires owners/operators to use reduced emissions completions, also
known as ‘‘RECs’’ or ‘‘green completions,’’ to reduce VOC emissions from well completions.
To achieve these VOC reductions, owners and/or operators may use RECs or completion
combustion devices, such as flaring, until January 1, 2015. As of January 1, 2015, owners and/or
operators must use RECs and a completion combustion device. The rule does not require RECs
where their use is not feasible, as specified in the rule. (See 40 CFR 60.5375; 77 FR 49543-44;
Federal Register August 16, 2012 [Emphasis added])

Well completions subject to the new federal standards are gas well completions following
hydraulic fracturing and refracturing operations. These completions include those conducted at
newly drilled and fractured wells, as well as completions conducted following refracturing
operations at various times over the life of the well. As was explained in the proposal preamble,

17

a completion operation associated with refracturing performed at a well is considered a
modification under CAA section 111(a), because physical change occurs to the well resulting in
emissions increases during the refracturing and completion operation. (Federal Register August
16, 2012).

The Revised Proposed Regulations (6 NYCRR Part 556.2(b)) prohibit the release of gas
to the atmosphere during a flowback or workover for more than 48 hours. Further, §556.2(c)
indicates that flaring is considered a release of gas and must then be limited to 48 hours or have
an extension filed on a per well basis. Such a requirement is infeasible as most well cleanouts
will exceed a 48 hour period allowing for no clean up or flowback time. To file for extension for
each well will be labor intensive. Furthermore, these restrictions exceed those required by
EPA’s NSPS’s Subpart OOOO and may be operationally impossible to meet.

IOGA recommends that the Revised Proposed Regulations follow, or incorporate by
reference, the federal regulations. The federal regulations allow for more flexibility regarding
REC use before January 1, 2015 and are not dependent on gathering lines. Moreover, the
Revised Proposed Regulations will be out of date if they are not amended before January 1, 2015
to be as strict as the federal regulations. There are no time limits on the flowback operations for
completion in the federal regulations since completion times will vary from well to well.
Flowback, as defined by the federal government, ends with either well shut in or when the well is
producing continuously to the flow line or to a storage vessel for collection, whichever occurs
first. See 77 FR 49497. This change should be made to the Revised Proposed Regulations. The
time limits imposed by the Revised Proposed Regulations cannot be met, are burdensome to
operators, and would require more paperwork from the operators and unnecessarily consume
time of state employees. Moreover, since paperwork burden was not discussed in the RRIS it is
yet a further violation of SAPA.

e. 560.2(b)(4) Best Management Practices

The Revised Proposed Regulations include a clarification to the proposed definition of
“best management practices” at Section 560.2(b)(4). This section now defines “best
management practices” to “mean measure or methods used to prevent or minimize potential
impacts on air quality, biological resources, land, and water quality caused by drilling,
deepening, plugging back or converting or producing a well subject to this Part.” § 560.2(b)(4)
(emphasis added). The changes noted in this definition broaden the duration of operations
encompassed in the definition, as well as the scope of impacts that must be addressed.
Additionally, no changes were made to make this definition consistent with the definition of best
management practices contained in 6 NYCRR § 750-1.2 as IOGA previously suggested. Instead,
a separate definition of “best management practices” applies to SPDES permits for HVHF
operations. This is yet another example of differences between the well permitting regulations
and the SPDES regulations, which should be eliminated or explained.

Practically speaking, however, this definition is nearly meaningless as the Revised
Proposed Regulations only employ the term in two places, in reference to invasive species
requirements and in reference to restoration of native plant cover associated with partial site

18

reclamation. See § 560.3(a)(16) & (17). Nearly all of the impacts cited in the definition of best
management practices are irrelevant to these topics. The definition should, therefore, be deleted.

f. 560.2(b)(7); 560.3(d)(1); 560.5(h) Chemical Disclosure Requirements

The Revised Proposed Regulations include new requirements to disclose chemicals
contained in hydraulic fracturing fluid, including most notably a new requirement to disclose the
contents of the hydraulic fracturing fluid after fracturing is complete, a requirement to post
chemical constituents used in an HVHF well on an online chemical disclosure registry, and
better defined trade secret protections.

IOGA fully supports the Department’s efforts to increase transparency of chemical
constituents through new sections 560.2(b)(7), 560.3(d)(1) and 560.5(h)(4). Members of the
service company industry who may seek protections for the chemical constituents within
hydraulic fracturing fluid are generally comfortable with the Department’s approach in the
Revised Proposed Regulations; however, these companies have a few concerns. Preliminarily,
the Department’s approach and the Revised Proposed Regulations vastly overstate the potential
impact from additives to hydraulic fracturing fluid by referencing material safety data sheets
(“MSDS”) instead of analyzing the actual make up of the fluid as a percentage. The Revised
Proposed Regulations should provide at least some acknowledgement that any chemicals used in
hydraulic fracturing fluid are diluted by substantial measure. This dilution is critical in
evaluating the impact a chemical constituent has on the environment in relation to the HVHF
process. Referencing an MSDS does not provide an accurate view of the impacts, because the
make-up of the fracturing fluid contains such a small percentage (in the range of 1 percent) of
additives.

It is commonplace for substances used every day by consumers as well as industries to
have a standard based in parts per million, or even parts per billion. For example, chlorine is
added to drinking water used every day by millions of people, but in much less quantity than that
described on the MSDS sheet, which makes the MSDS sheet not relevant to the impacts
experienced by water consumers. If a ppm or ppb standard was used for HVHF, it would give
perspective to the actual risk presented, instead of reviewing the potential dangers of a material
in its concentrated form as listed on the MSDS sheet. Such an approach allows the Department
and the public to review the properties and any hazards associated with these substances in
diluted form consistent with how industry utilizes all of the additives in the field.8

IOGA commends the Department for acknowledging protections for trade secrets in
proposed Part 560 that are important to various sectors of the HVHF industry. Such a balance
serves both New York State’s right to know with the protections normally afforded confidential
trade secret information. The FOIL protections and procedures are generally consistent between
the disclosure required during the well permit application process and the post-completion
reporting, however; Section 560.5(h) contains an inconsistency in the protections afforded
compared with the protections contained in Section 560.3(d). When applying for a well permit,
Section 560.3(d) allows the applicant to seek trade secret protections for the identity of each

8
Industry acknowledges that an MSDS is relevant for emergency responders relative to the chemicals that are stored
on site prior to use in the high volume hydraulic fracturing process.

19

additive proposed for use (see § 560.3(d)(1)(ii) & (2)), while the identity of each additive is not
protected in the post-completion disclosures. See § 560.5(h)(1)(viii) & (2). This should be
corrected.

It is also noted that the proposed SPDES regulations require disclosure of “a
representative assay of the concentrations of chemical constituents present” to apply for
treatment or disposal of HVHF wastewater for POTWs, privately owned disposal facilities, and
for UIC wells. See § 750-3.12(c)(2), (d)(2) & (f)(3). Additionally, the POTW and privately
owned disposal facilities must maintain “a list of chemical constituents used in HVHF, along
with a representative assay of the concentrations of chemical constituents present, as well as
other parameters that may be present.” See § 750-3.12(c)(5) & (d)(5); see also (c)(7). However,
there are no specific trade secret protections notwithstanding that those constituents are protected
during the well permit application and completion stages. While the general SPDES regulations9
allow an applicant to request confidentiality pursuant to 6 NYCRR Part 616, this does not
provide sufficient protection, especially given the broad disclosure requirements unique to the
HVHF program and the tailored trade secret protections the Department proposes in Part 560.
IOGA recommends, therefore, that proposed Part 750-3 be modified to incorporate the trade
secret protections contained in Section 560.3(d). See Exhibit A for proposed revisions to Section
750-3.12.

In addition, Section 560.3(d)(1) should do more to encourage flexibility in disclosing
components of hydraulic fracturing fluid as part of a permit application, such as allowing broad
potential ingredient lists to be filed, with clarifications as to which of those ingredients disclosed
were actually utilized provided in the later disclosure included in Section 560.5(h)(4). This type
of flexibility would take into account the fact that, very often, permit applications will be drafted
many months (6 to 12 months) before the well is actually drilled and before site-specific
geologic conditions are identified through the drilling phase of well development, which may
necessitate changes in the frac fluid composition. By allowing a broader array of potential
chemicals to be used in the hydraulic fracturing stimulation process, the Department will give the
industry, including the service sector of the industry, the flexibility that they need to make
adjustments at the time of stimulation consistent with the statutory mandate to promote the
ultimate recovery of the resource.

IOGA previously submitted comments regarding the requirement to complete a “green”
frac fluid analysis for each well permit contained in Section 560.3(d)(1)(v) (which is now
subdivision (d)(1)(viii)), as well as Sections 750-3.7(k)(2). The 2012 Comments recommended
conducting a biennial master chemical review with the HVHF service companies instead of a
permit specific review. As the Department did not accept this recommendation, all of IOGA’s
previous remarks regarding the “green” hydraulic fracturing fluid analysis are repeated and
incorporated by reference here. Although IOGA supports the effort to encourage improvements
to the hydraulic fracturing process that have resulted in a reduction in the number of chemicals
used and improvements in efficacy, this is yet another example of the failure of the Department
to implement regulatory flexibility.

9
See 6 NYCRR § 750-1.22.

20

Additionally, while IOGA acknowledges that the documentation making up the green
frac fluid analysis requirement, both in Part 560 and Part 750-3.7, is now limited to “existing
data and studies,” industry is unclear as to the meaning and application of the requirement to
document that additives “exhibit reduced aquatic toxicity.” See §§ 560.3(d)(1)(viii), 750-
3.7(k)(2). As with chemicals used in any industrial process, there are many substances that have
not been fully tested on all species. Presumably, the new language limiting the analysis to
existing data and studies would not require any additional aquatic toxicity studies, but this should
be clarified.

Further, Section 560.6(c)(23)’s prohibition on the use of hydraulic fracturing fluids other
than those identified in the well permit application without Department approval should be
clarified to provide flexibility, i.e. by allowing the Department to approve changes verbally, with
written approval following if necessary. Such flexibility is necessary, as noted above, because of
changing conditions in the field that can only be discovered during the drilling and hydraulic
fracturing process. Alternatively, allowing applicants to identify a broad array of chemicals that
may be used in the stimulation process would solve this problem by allowing flexibility.

Finally, IOGA notes that there is an inconsistency in the Revised Proposed Regulations.
An applicant for a well permit must identify the proposed hydraulic fracturing service company
pursuant to Section 560.3(d)(1)(vii). Practically speaking, this company may change during the
six to twelve months between submitting an application, receiving approval, and ultimately
hydraulically fracturing a well, and there is no opportunity to amend this information in later
disclosures or on the Pre-Frac Checklist and Certification. IOGA recommends that any changes
to the service company be identified on the Pre-Frac Checklist and Certification.

g. 560.3(a)(16) Invasive Species

The Revised Proposed Regulations now include a requirement for an applicant to produce
“a list of invasive species found at the well site and description of the best management practices
which will be used for preventing the spread of these invasive species, including measures being
used to prevent new invasive species from being transported to the site.” See § 560.3(a)(16).
This provision, which is unique to any Department industrial or commercial permitting program,
presents a number of concerns.

In 2003, the State took initial steps to address the growing problem of invasive species
and statutorily established the Invasive Species Task Force (Chapter 324 of the Laws of New
York 2003). The Task Force studied the problem of invasive species and provided
recommendations to the Governor and Legislature in the Final Report of the New York State
Invasive Species Task Force (Task Force 2005). Subsequently, the Legislature implemented the
first Task Force recommendation by establishing the NYS Invasive Species Council (Council)
and the Advisory Committee to the Council (Chapter 26, Laws of New York, 2008,
Environmental Conservation Law, Article 9, Title 17).

According the to the New York State Invasive Species Management Strategy which was
prepared for and submitted to the Department, it is recommended that the Invasive Species
Council should “undertake an initiative to integrate invasive species concerns in all relevant state

21

and local planning and construction projects.” New York State Invasive Species Management
Strategy, § 4.3, p. 4-8 (2011). The recommendations clearly state this approach should focus its
limited resources and energies on state and local projects, not private sector activities.
Additionally, the Management Strategy does not recommend best management practices or
protocols for construction projects or other industrial activities. The provisions of proposed
section 560.3(a)(16) call for the creation of a management strategy by industry that is not been
contemplated, vetted or recommended by the state’s own Invasive Species Council, is not part of
its Invasive Species Management Strategy nor is it discussed as part of the processes outlined by
statute and subsequent tasks forces to address real and challenging invasive species issues.

Furthermore, the construction and surface disturbance activities associated with HVHF
differ in no way from the historic development of conventional well sites or with the
development of typical commercial sites such as shopping centers. As the Invasive Species
Council conducted a rigorous review of potential industrial and commercial activities that could
serve as conduit for the spread of invasive species and failed to identify oil/gas well site
development as a primary activity of concern, there is no basis for this requirement.
Accordingly, IOGA believes that the Department is placing undue burden on the HVHF industry
without any basis in law or policy, and without merit. Accordingly, Section 560.3(a)(16) should
be removed from the Revised Proposed Regulations.

In the event that the Department does not remove this provision, IOGA recommends that
the Revised Proposed Regulations include flexibility to develop and implement an operator
specific invasive plan. Prescribed requirements on analysis, mapping, identification, biological
assessment, requirements to reintroduce native (yet now currently absent) species, and
significant vehicle washing requirements, should not be advanced as prescriptive requirements.

Additionally, failure include the potential cost associated with developing 1) best
management practices for preventing the spread of invasive species and 2) measures for
preventing transport of new invasive species to the site, violates SAPA, as described above.
Indeed, in the absence of any guidance on how to control invasive species at an HVHF or similar
industrial site, the time and cost to develop such a program may likely be considerable.
Currently, no Department regulations require a permit applicant to address invasive species, with
the exception of the transport of firewood. In the absence of any analysis as to cost in the RRIS
and RRFA, however, IOGA cannot be certain how much this will cost and what unintended
consequences will occur. It is, therefore, critical that the Department remove this requirement or
provide significant changes so that it is workable for industry.

h. 560.3(a)(17); 750-3.2(35) Partial Reclamation

IOGA previously commented that the definition of “partial reclamation” was different in
the proposed Part 560 regulations (§ 560.2(b)(18)) and the proposed Part 750-3 regulations (§
750-3.2(b)(35)), and that the Part 750 definition should be deleted, with a reasonable timeframe
imposed for partial reclamation imposed in the Part 560 regulations. The Department accepted
none of these suggestions and, although modifications were made to the Part 750 definition of
“partial reclamation,” these modifications to not adequately address IOGA’s concerns. As
industry has made clear to the Department on a number of occasions, including in its 2012

22

Comments, there will be a variety of factors that will dictate the rate at which wells are
developed on a common well pad. Well pads typically are not reclaimed at all until the well pad
has had all of the wells drilled, the wells are hydraulically fractured and the wells have been
turned into production. Where full well pad development is spread out over time, the sites are
stabilized and seeded & mulched, where necessary, but not reclaimed. Requiring unnecessary
reclamation promotes unnecessary land disturbance, which will actually increase the potential for
impacts from stormwater runoff.

i. 560.3(e) Application Procedures

The Revised Proposed Regulations now contain a procedure for submission and review
of HVHF well applications, which, as mentioned above, is useful to industry. However, IOGA is
concerned that proposed Section 560.3(e)(5) will create an opportunity for inefficiency in the
permitting process. By allowing comments on “local and site specific issues that have not been
addressed in the Final Generic Environmental Impact Statement,” the Department may open
itself up to continual comment challenging the sufficiency of the SGEIS and its applicability to a
particular site. Additionally, this Section should make clear that the Part 560.3 regulations
govern the application process and do not create any new requirements that might be interpreted
as being subject to the Uniform Procedures Act, including any process that would give rise to the
right to an adjudicatory hearing.

j. 560.5(c) Non-Routine Incident Reporting

The Revised Proposed Regulations include modifications to Section 560.5(c) regarding
reporting of non-routine incidents. IOGA notes that a “non-routine incident” is described by
statute at ECL Section 23-0305(8)(h), and the Revised Proposed Regulations do not contain a
specific definition outside of proposed Section 560.5(c). IOGA recommends that a definition be
added to the Part 560 definitions section. This terminology could be used in a definition of “non-
routine” incident. As currently proposed, the term “non-routine incident” includes incidents of
water complaints and other items which were not really intended as a non-routine incident in the
statute. IOGA has revised proposed Section 560.5(c) to be more consistent with the statutory
definition in Exhibit A, attached. This terminology could be used in a definition of “non-routine
incident.”

k. 560.5(d) Sampling Parameters

IOGA reviewed and compared the Revised Proposed Regulations to industry’s standard
pre-drill baseline water parameters completed in the neighboring states (PA & OH). IOGA has a
number of resulting comments. Section 560.5(d)(1) was modified to include a number of
minimum parameters that must be sampled for all required water testing. Even with the addition
of these minimum parameters, this regulation still seems to be open-ended. IOGA suggests
having a defined list without the caveat of as “specified by the department.” The modifications
to Section 560.5(d)(1) added a requirement to test Gross Alpha and Gross Beta. However, this
sampling is not required in neighboring states such as Pennsylvania.

23

Section 560.5(d)(1) added a requirement to test the Static Water Level (when possible),
which requires, for accurate results, invasive measures on the subject water well. Performing
these procedures will greatly increase the risk of exposure for the landowner’s well/water source
and expose industry to potential claims from landowners concerning adverse impacts to their
well by reason of the invasive procedure. Currently, industry’s program is only through “non-
invasive” measures, which means industry does not open or measure anything within the
confines of the water well or source. This minimizes the risk of a landowner claiming that their
well has been contaminated, or damages to their water pump, flow or other water well features
have occurred.

Using any invasive measure for testing has a very high risk. Industry generally only
performs invasive measures like this where required by lease water clause requirement, which do
exist but generally are not a common part of a typical industry’s program. IOGA also notes that
applying the “when possible” provision to the static water level testing could be difficult, as this
Section contains no discussion on how the Department will determine if testing is possible.

Section 560.5(d)(1) also adds Volatile Organic Compounds (VOCs), and specifically
BTEX, to water sampling parameters. Industry in other states currently reports BTEX in their
baseline analyses; however, IOGA questions the need to require sampling of other VOCs as part
of the water sampling requirements. Other VOCs are not compounds commonly used in the
HVHF industry, so no later comparison would be needed. Further, operations in Pennsylvania
do not require this sampling. Sampling BTEX helps industry understand if there are legacy
issues commonly associated with any underground storage tank (UST) and other downstream
industry activity present. IOGA would, therefore, recommend deleting the requirement to
sample VOCs other than BTEX.

In the event the Department does not delete this requirement, industry requires a full
understanding of which VOCs the Department will want tested, particularly to be able to assess
cost, as there would be an added cost per sample. If VOC testing is required, IOGA recommends
adopting a list of the VOCs that must be tested to the Revised Proposed Regulations in either a
table within the regulations or an addendum.

Section 560.5(d)(2) now includes a requirement that “all significant deviation(s) from the
baseline compositions” be reported to the Department. This needs to be better clarified as to
what is a “significant deviation” and the “timing” for when a “determination” is made. No other
state has a requirement like this. Only one state (CO) currently has a “post-drill” sampling
requirement, but it does not have any notification of variances with analytical results. An
important consideration here is that there are common and normal “natural,” “seasonal” and
“analytical” variances that are acceptable in environmental analysis. If this becomes a
requirement, then thresholds for acceptance need to be clearly defined.

Industry has additional questions regarding the sampling requirements in general. Will
the sampling data be kept confidential? “Ambient” sampling might identify an individual well
issue that might affect a landowner’s private property value or result in an enforcement action on
the well owner. Section 560.5(d)(3) talks about submission of test results to New York State
Department of Health. Will that lead to public disclosure? If so, that landowner should know

24

that going into the sampling process. The Revised Proposed Regulations do not appear to take
into account or require any assessment of the well construction itself as part of this sampling
requirement or identification of existing pollution sources that might already be impacting the
well. Finally, what specifically constitutes a “reasonable attempt” to (1) obtain a landowner’s
permission; and (2) to sample and test a well?” Industry needs to understand the outreach
requirements that will be in effect.

l. 560.5(f) Internet Posting of Waste Tracking Forms

The Revised Proposed Regulations have added a requirement for the owner and operator
to post completed Drilling and Production Waste Tracking Forms, for any wastes “disposed
instead of recycled or reused,” on the owner or operator’s website within 30 days of receipt of
the waste by the disposal company. See § 560.5(f). As the Revised Proposed Regulations require
a Waste Tracking Form to be prepared “for any used drilling mud, flowback water, production
brine and drill cuttings removed from the well site,” each time these materials move off a site to
a disposal facility (i.e., each truckload), a form would have to be prepared. Id. For a given site,
this could result in hundreds of postings per well.

Initially, IOGA questions the legal authority for this requirement, which appears to be
based upon “right to know” principles rather than environmental mitigation. Any such
requirement should have a statutory foundation, which is totally lacking here. In addition, this
requirement appears to be an arbitrary requirement that is being imposed upon the natural gas
industry without any similar requirements being imposed upon other industries, including
industries that engage in the business of generating, transporting or disposing of wastes. Indeed,
the Department rarely requires posting of information on the internet and in no other case is
industry required to post information on its own website for informational purposes only.
Further, no federal environmental law imposes this requirement on the permit holder as a means
of disclosure; the federal agency generally maintains and posts information of this nature in some
form on its own website. All of this points to the conclusion that the Department is proceeding
in excess of its legal authority.

IOGA, therefore, recommends that the requirement to post Waste Tracking Forms on the
operator’s website be removed, or in the alternative, that the Department be responsible for
posting the information on the Department’s website, perhaps in a similar manner to its current
environmental remediation sites and spill incidents or oil and gas well databases.

m. 560.7(c) Mineral Oil Containing Drill Cuttings

The Revised Proposed Regulations added a prohibition on the onsite burial of drill
cuttings contaminated with polymer-based mud containing mineral oil lubricant. See § 560.7(c).
This prohibition is unnecessary, and discourages flexibility and advances in technology. There
are new nano-materials and advancing technology to render these materials inert and safely bury
them onsite. These technological advances, should be properly evaluated and permitted by the
Department pursuant to a Beneficial Use Determination or similar approval. IOGA, therefore,
recommends removing this restriction and including a provision to allow these materials to be
buried if proper approvals are received.

25

The wording used in Section 560.7(c) related to “disposal” (and seemingly excluding
beneficial reuse opportunities) should also be revised for consistency with Section 554.1(c)(4).
See Exhibit A for proposed revisions to this section.

n. 560.7(i), (k); 750-3.7(k)(6) Radioactivity Issues

A number of revisions were included in the Revised Proposed Regulations relating to
radioactivity. For example, Section 560.7(i) now includes a requirement to analyze flowback
water, production brine, and the soils adjacent to these fluids for radioactivity.

The oil and gas industry conducts periodic external radiation surveys to detect the
presence of NORM in equipment and wastes. The finding of external radiation levels in excess
of standards, which differ somewhat from state to state, triggers requirements to handle wastes
and decommissioned equipment according to regulations. Survey results are also used to
determine the need for specific NORM management procedures to ensure appropriate industrial
hygiene practices. It is also a routine practice to survey soils during the decommissioning of
sites. A practical suggestion is to require periodic external radiation surveys and to establish a
trigger level above which wastes and surplus equipment must be treated according to NORM
management procedures.

As the Department is well aware, data collected by the Department itself has
demonstrated that flowback and produced water do not present significant NORM issues in New
York State. In April, 1999 study entitled “An Investigation of Naturally Occurring Radioactive
Materials (NORM) in Oil and Gas Wells in New York State” concluded that the amount of
NORM in produced water is relatively insignificant and does not amount to any public health
hazard. Specifically, the study included 43 brine (salty waters brought to the surface as a
byproduct of gas production), 10 scale, two sludge, two water and one soil sample. Only two
brine and one scale sample indicated radium isotope concentrations that were greater than 5.0
picocuries per gram (pCi/g) total radium (pCi/ml for liquid samples such as brines). The brine
radium results, 0.95 and 24 picocuries per milliliter (pCi/ml) for one sample, and 3.8 and 7.7
pCi/ml for the other (Ra-226 and Ra-228 respectively), were found not to pose any threat to
public health or the environment. This conclusion is supported by an analysis of road disposal of
the brine with the U.S. Department of Energy’s (USDOE) Residual Radioactive Material
Guideline computer model (RESRAD). The scale result, 11 pCi/g for Ra-226 and 3.8 pCi/g for
Ra-228, was also found not to pose any threat to public health or the environment due to the low
amount of scale deposited in gas plant piping. Based upon this analytical data the Department
reached the following conclusions:

1. Several types of oil and gas well field wastes were found to contain slightly
concentrated NORM but not at concentrations sufficiently high to pose a threat to
the public health or the environment. These wastes include gas well field brines
and well casing scales, and oil well sludges and sediments.

26

IOGA of NY Response/Revisions to DEC on New Fracking Rules

IOGA of NY Response/Revisions to DEC on New Fracking Rules

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