Stage 2: Leasing & Permitting

Health issues in this section:

Air Quality Water Quality Water Quantity Safety Diseases Quality of Life

What is the company doing at this stage?

Leasing

Only exploratory drilling can confirm the presence of viable oil or gas deposits. Prior to drilling, however, the company must obtain the rights to develop the subsurface minerals. If early exploration has indicated promising geologic structures, the company will attempt to purchase or negotiate lease contracts with the mineral owners, who could be individuals, trusts, governments, or other companies. 

Where conditions are suitable for oil and gas development, state regulators create a system for efficiently extracting the resources. This process includes determining well spacing, or the permissible proximity of wells within one geological formation. A drilling unit is the area designated by state governments that can contain a single oil or gas well, and the allotted acreage can vary widely by state.

The company typically needs to lease a certain portion of a drilling unit before drilling can take place. If the company does not obtain control of the necessary acreage, then production in that area might not proceed; in that case, the company might sell its interests in the leases it has obtained.

Permitting

Once the leases are in hand, the company must secure the necessary permits before it can proceed with drilling a well. Depending on the location, there can be local, state, tribal, and federal government agencies involved in the permitting process.

Who has authority over the permitting process?

Federal Government

There are several federal statutes, including the Clean Air Act and the Clean Water Act, that apply to shale energy development (for a summary of federal laws and regulations pertaining to shale development, see Appendix C). Federal agencies may delegate the implementation of federal laws to the states under federal oversight. States may adopt their own standards on these issues, although they must be at least as protective as the federal statutes—and can be more so. Federal agencies also directly regulate oil and gas development occurring on federal lands.

Tribal Government

Native American lands are often held in trust by the federal government, and therefore potential energy development on or near tribal lands involves coordination and negotiation with both the tribal government and relevant federal government agencies. There can also be unique laws and regulations pertaining to energy development on tribal lands.

State Government

States regulate shale gas development and production on their territory and may be the primary administrators of relevant federal laws. It is possible for several different state agencies to play a role in regulating shale development. The agency with primary authority varies from state to state; there may be a designated oil and gas commission, or the primary agency may be housed in the state’s department of natural resources or environmental protection agency (for the agency with primary authority in your state, see Table 2). The recent boom in shale energy development has resulted in many states finding that they have insufficient resources and staffing to meet the demands of administering the necessary regulations. 

Local Government

County and municipal governments often play a regulatory role in or near populated areas, where they may manage issues such as noise levels, lighting, traffic flow, and the required distance that the operation must maintain from residences or other sensitive areas (or setbacks). Zoning laws are the primary tool for local governments to manage shale development in their area. In some cases, local governments have attempted to impose limits or bans on shale development in their area, bringing them into conflict with the state’s authority over the development of natural resources. State courts are currently adjudicating some of these state preemption cases with varying outcomes (see Appendix C).

What must the operator do to obtain the necessary permits?

Once the company has gathered the leases in an established production unit, it must secure state and local permits prior to drilling an oil or gas well. In order to file for the permits, operators must prepare for a number of aspects of the development process, which vary from state to state. For example, the Colorado Oil and Gas Conservation Commission (COGCC) drilling permit application 1 includes the following elements:

  • Financial assurance—in most states, the company must post a bond that guarantees the funding for proper well abandonment and site restoration.
  • Leases and agreements—the operator must have acquired the mineral rights where it intends to drill. In Colorado it must also stake the site by surveying the land, mapping out the area where it intends to locate the well pad, and marking it with stakes to create a plot. The survey details are required in the permit application. In the case of a split estate (see Box 2), the operator must make arrangements made with the surface owner for access, either by signing a surface use agreement or by posting a bond.
  • Setbacks—to comply with setback regulations, operators must indicate the distance to the nearest public infrastructure. In a review of regulations in 31 states with existing or potential shale development, the nonprofit organization Resources for the Future (RFF) found that most states require setbacks from buildings and other sensitive structures. Setback distances range from 100 to 1,000 feet from the well. 2 Fewer than half of the states (12 of 31) require setbacks from water sources; Colorado is among them.
  • Groundwater monitoring—operators must conduct pre- and post-drilling groundwater monitoring and post the results on the COGCC website. As of May 2013, a limited number of states require baseline water well testing (8 of 31 surveyed). 3
  • Waste and wastewater disposal plan—operators must indicate how they plan to handle wastes from the drilling operation in a manner that meets the applicable regulations.

In addition to the drilling permit, the operator must obtain federal Department of Transportation (DOT) permits for the transport of heavy loads. Some states or localities may require operators to work with local agencies to designate which roads it intends to use or construct. The operator might also need to obtain a permit to construct temporary housing facilities for workers or to identify the source of water that it will draw on for its operations.

During this phase, the operator will typically bring in a small team of experts to begin the necessary assessments and prepare the plans. It might also hire a few additional local workers. Once the state approves the permits, the operator typically has a 1-2 year timeframe in which to construct the well pad site. 

Notes:

  1. Colorado Oil and Gas Conservation Commission, “Application for Permit to Drill – Form 2,” video (8:26) on website, accessed December 10, 2014.
  2. Resources for the Future, “A Review of Shale Gas Regulations by State:  Setback Restrictions from Buildings,” updated May 22, 2013.
  3. Resources for the Future, “Shale Gas Regulations.”

What might my community experience?

To identify the owners of the mineral rights in your community, third party contractors will conduct extensive research at the local office of deeds and records, often resulting in a noticeable increase in activity and demands on that office. 

As in the previous stage, there can be a number of different industry representatives operating in your area. In addition to the oil and gas companies and their contractors, there are agents, often known as landmen, who negotiate mineral leases with property owners. They might work on behalf of a particular company or work independently as a speculator to put together acreage that they can later resell to oil and gas operators. 

For local property owners who hold the mineral rights to their land (see Box 2), landmen may approach them to lease the mineral rights. These owners can negotiate leasing terms and additional agreements for use of their surface property to access the minerals. Depending on the stage at which mineral owners are contacted, the price offered per acre can vary significantly.

For surface owners who do not own the mineral rights, some states require companies to make a good faith effort to negotiate surface use agreements with them. Some companies will negotiate such agreements even in the absence of a requirement. 

There are 58 million acres of land nationwide where the federal Bureau of Land Management (BLM) owns the mineral rights, but private citizens own the surface property. 1 The agency has established standards and guidelines for interacting with landowners that oil and gas operators must follow (“the Gold Book”). According to these guidelines, the operator must make a good faith effort to come to an agreement with the surface owner regarding access to the lands. If these efforts should fail, then the operator is required to post a bond for any damages or losses incurred by the surface owner. 2

Notes:

  1. Bureau of Land Management, “Split Estate:  Rights, Responsibilities, and Opportunities” (2007), agency brochure. 
  2. API recommends that operators consult the Gold Book for guidance and best practices on communication and addressing the concerns of surface owners. American Petroleum Institute, “Environmental Protection for Onshore Oil and Gas Production Operations and Leases,” API Recommended Practice 51R (July 2009), 6. 

What might my community experience?

BOX 2 – SPLIT ESTATE

A split estate is a property whose subsurface minerals do not belong to the surface owner, but have been previously separated, sold, or allotted to another owner (sometimes the federal government). In this case, the oil and gas operator is not required to obtain the consent of the surface owner in order to explore or to develop the minerals. In some states, however, companies must attempt to negotiate access and impact compensation with surface owners. Compensation provisions include damages; any losses suffered due to the interruption of crops or the grazing of cattle; and the costs of replanting native grasses.

What might my community experience?

What do landowners who are approached about signing shale development leases need to know?

Landowners who own the mineral rights to their land stand to benefit from lease payments and royalties for the extraction of oil and gas. It is important to consider, however, the anticipated activities and potential impacts to your lands or property when negotiating a surface use agreement. 1  There are also potential liability and mortgage risks for owners to consider. 2  Several organizations offer guidance for landowners considering signing oil or gas leases or surface use agreements (see the resources section below).

With regard to property values in your community, the effect of energy development can be mixed. If you own the mineral rights on your property, the property values can be expected to increase. Studies suggest that regional property values tend to rise with development due to an influx of project workers and the economic boom, although this effect declines over time. 3 According to one study, whether properties in proximity to drilling sites increase or decrease in value depends on several factors, including their distance to the drilling site, whether they rely on well water or piped water, and if they are located in an area that has been previously permitted but not drilled. The value of homes in proximity to shale development sites has tended to increase overall, unless the home relied on well water, which indicates a perceived risk to the local water quality. 4 5

What are the implications of forced pooling laws?

Thirty-nine states have laws allowing for compulsory integration into a drilling unit, or forced pooling. 6 If a company controls a certain percentage of the acreage within a drilling unit, forced pooling allows the state to draw the remaining unleased properties into the unit, allocating a share of the royalties to the owners. 7 These laws were initially developed to promote efficient development of the mineral resources and prevent the drilling of too many wells in close proximity. They were also intended to keep a mineral owner’s resources from being extracted through a well on a neighboring property without compensation. 8 

If owners within a drilling unit do not wish to sign a lease, the operator can file a forced pooling application with the state. If approved by the state, mineral owners are then given a choice:  participate as a stakeholder in the development of the well or simply receive bonus and royalty payments. The operator usually accesses the minerals through horizontal drilling from a neighboring property. Forced pooling laws have most often been used in the longstanding oil and gas lands in the West; their usage in states in the newer shale plays is still to be determined. 9 10

What bonding and compensation requirements are there to protect landowner property and community infrastructure?

If the landowner and company negotiate a surface use agreement, this contractual agreement includes provisions for compensation of any damages. 11 Shale energy development is primarily regulated under state laws, which vary considerably. Some states have statutes requiring companies to attempt to negotiate compensation for potential damage with surface owners, as well as provisions incentivizing the companies to minimize damages. If no agreement is reached and property damages are not repaired, property owners might be able to take a complaint before the state agency or oil and gas commission, depending on the state. Alternatively, they can seek compensation through the court system. 

Most states require companies to post a bond, or a form of financial assurance, prior to drilling to cover the cost of plugging the well and reclaiming the site. This is done to ensure that there is funding to cover the costs if, for example, the company goes bankrupt before decommissioning the site.

With regard to community infrastructure, some municipalities and counties also have regulations relating to shale development. These regulations require companies to post bonds to cover any damages to local infrastructure; have permit and/or fee requirements; or have zoning ordinances restricting areas for development. In some states, local governments can require operators to enter road use agreements that specify conditions for local road and bridge improvements and maintenance, leading to improvements in local infrastructure. Costs can be shared or paid fully by the operator.

Notes:

  1. See Earthworks, “Oil and Gas at Your Door?” III-5–III-8 for a checklist of concerns and surface use agreement provisions to consider.
  2. Elisabeth N. Radow, “Homeowners and Gas Drilling Leases:  Boon or Bust?” New York State Bar Association Journal 83, no. 9 (November/December 2011), reprinted at http://cce.cornell.edu/EnergyClimateChange/NaturalGasDev/Documents/PDFs/NYSBA%20Journal%20nov-dec2011.pdf.
  3. Lucija Muehlenbachs, Elisheba Spiller, and Christopher Timmins, “The Housing Market Impacts of Shale Gas Development” Resources for the Future Discussion Paper 13–39 (Washington, DC:  December 2013), 1.
  4. Muehlenbachs, Spiller, and Timmins, “Housing Market Impacts,” 1.
  5. New York State Department of Environmental Conservation, High-Volume Hydraulic Fracturing in NYS: 2015 Final Supplemental Generic Environmental Impact Statement (SGEIS) Documents (Albany, New York:  April 2015), 6-253–6-254.
  6. Marie C. Baca, “Forced Pooling: When Landowners Can’t Say No to Drilling,” ProPublica (May 18, 2011).
  7. Baca, “Forced Pooling.”
  8. Mike Lee, “Nuns and Other Landowners Watching as Pa. Reschedules ‘Forced Pooling’ Case,” E&E News (July 23, 2014). 
  9. Lee, “Nuns and Other Landowners.”
  10. For a compilation of state laws on forced pooling, see Marie C Baca, “State Laws Can Compel Landowners to Accept Gas and Oil Drilling,” ProPublica (May 19, 2011). 
  11. For landowner tips, a checklist of issues to consider when negotiating an agreement, and a sample agreement, see Oil and Gas at Your Door? III-3–III-23. 

What health considerations are there?

Health considerations at this stage continue to be focused in the quality of life domain, with the introduction of possible impacts on social relationships in your community. As discussed in Box 1 on health-related quality of life, an individual or group’s perceptions of their position in life in the context of their environment can have an important role to play in their overall health and well-being. 1 The quality of life concept includes economic, social, and psychological aspects, among others.

Quality of Life—Economic Impacts

Some landowners may financially benefit from the project by signing lease agreements with the operator, which can result in an improvement in quality of life by providing them greater financial resources and opportunities.

Quality of Life—Social Impacts

Many communities where shale development occurs are small, cohesive rural communities with a place-based identity. With the introduction of lease offers to some residents—but not others—in the community, residents can begin to perceive the potential benefits of the project as unequally distributed, creating a new source of community tension and disagreement. These changes, as well as those that take place in future stages, could result in the loss of a sense of community identity and cohesion. Furthermore, the prospect of shale development can cause some residents to start moving out of the area, either because of  increased activity driving up costs (see Economic Impacts under Stage 3), or because they are concerned about the potential environmental and social impacts.

In communities that are economically depressed, the prospect of economic benefits accompanying shale development can be a source of optimism. As mentioned above, the project might lead to improvements in local infrastructure, and might offer increased job opportunities if the project proceeds to exploratory drilling (see Economic Impacts under Stage 3). At this stage, however, it can be important to temper such optimism with an awareness of the possibility that the project will not move forward, to prevent the community making premature investments based on expected income.

Quality of Life—Psychological Impacts

According to the World Health Organization, health is “a state of complete physical, mental, and social well-being and not merely the absence of disease or infirmity.” 2 Psychological stress and the perception of negative impacts can play a significant role in an individual’s overall health. Chronic stress can result in physical health impacts and initiate a self-reinforcing cycle—i.e., in response to a psychological or physical stressor, an individual’s perception of health impacts may increase, which in turn increases his or her allostatic load, or the “wear and tear on the body” resulting from the accumulation of repeated or chronic stress. 3 

In this stage of shale development, landowners who do not control the mineral rights on their property, or those who may not wish to sign agreements but could be subject to forced pooling laws, might experience psychological stress related to uncertainty and a sense of lost control over a valuable financial asset and their home environment. Landowners concerned about property values or possible damages to their estate could also experience such stress and a decline in quality of life. In addition, uncertainty surrounding the potential project and its impacts, as well as a fear of change, can have negative psychological effects on some community members.

In a 2013 study published in the International Journal of Occupational and Environmental Health, researchers interviewed a small set of residents in areas of shale development in the Marcellus Shale play who were reporting health impacts. 4 The goal was to identify the physical and mental stressors that participants attributed to shale development. The most commonly reported stressors involved the perception of negative interactions with and a lack of trust in company representatives and government officials. The top concerns identified were the following:

  • having their concerns denied or being provided with false information (79%)
  • corruption (61%)
  • having their concerns/complaints ignored (58%)
  • being taken advantage of (52%) 5

The authors observed that these stressful feelings likely reinforced participants’ concerns for their health, which increased over the three sessions of the study. As the authors note, there are relationship-building steps that local officials and company representatives can begin taking during the early stages of shale development to help alleviate concerns around trust and credibility. The activities listed in the “What Can Be Done?” sections of this guidebook, as well as those suggested in the American Petroleum Institute’s (API) “Community Engagement Guidelines.” 6  could be helpful in establishing relationships with communities.

Notes:

  1. World Health Organization, “WHOQOL: Measuring Quality of Life” (1997). 1.
  2. Kyle J. Ferrar, Jill Kriesky, Charles L. Christen, Lynn P. Marshall, Samantha L. Malone, Ravi K. Sharma, Drew R. Michanowicz, Bernard D. Goldstein, “Assessment and Longitudinal Analysis of Health Impacts and Stressors Perceived to Result from Unconventional Shale Gas Development in the Marcellus Shale Region,” International Journal of Occupational and Environmental Health 19, no. 2 (2013):  104–12.
  3. Ferrar et al., “Health Impacts,” 110–111.
  4. Ferrar et al., “Health Impacts.”
  5. Ferrar et al., “Health Impacts,” 109.
  6. American Petroleum Institute (API), “Community Engagement Guidelines,” ANSI/API Bulletin 100-3, first edition (July 2014).

What can be done to address health concerns? What have others done?

Collaborative Activities

Stakeholder Engagement, Communication, and Planning

This early stage is an opportune time to initiate communication channels and information sharing between the company and the community. Regardless of the company’s plans, it is important for company representatives to work with local governments to plan for the eventual closure of the project from the outset. Anticipating the company’s withdrawal from the area helps to reduce the risks and maximize the benefits to the community. 1

How can I identify an industry partner?

Given that there can be a number of oil and gas operators and their contractors working in a particular area, it can be difficult for local stakeholders to identify appropriate industry partners. The API Community Engagement Guidelines urge operators to coordinate among themselves to engage with community stakeholders. 2 Some oil and gas companies regularly engage with communities as a part of their operations. Local officials or community leaders seeking to engage the industry could first contact the state regulator to obtain contact information for a particular company’s regulatory manager (company contact information is also available on the regulatory permit). The manager has the ability to help identify the appropriate point of contact internally—for larger companies, it could be the communications representative or community liaison, and for smaller ones it could be an operations or exploration manager.

Notes:

  1. API, “Community Engagement Guidelines,” 5.
  2. API, “Community Engagement Guidelines,” 3.

What can be done to address health concerns? What have others done?

COLLABORATIVE ACTIVITIES

What topics are useful to discuss at this stage?

If local officials and company representatives meet to discuss the company’s anticipated needs and potential community impacts, possible topics to cover include:

  • the likelihood that the project will proceed to production
  • the length of time the operator anticipates conducting activities in the community
  • the typical number of outside workers the project will require and how the company plans to accommodate them  
  • the number of families and children who could accompany project workers, which can help local officials determine whether more educational resources are needed
  • the profile of the local labor pool and whether the company plans to hire locally; if so, what  job skills and training might be necessary
  • the company’s emergency response plans and potential demands on emergency and fire department services, including any training needs and any specialized emergency response equipment that should be acquired (e.g., personal protective equipment)
  • amount and timing of anticipated vehicle traffic; which local roads/bridges to avoid or are in need of an upgrade
  • method for responding to any impacts to local infrastructure and services
  • the company’s plans for water sourcing; air, water, and noise monitoring; waste disposal; and erosion control
  • approach to responding to community concerns about light,  noise, and dust from traffic
  • any plans to conduct flaring at the site
  • the company’s approach to engaging local community stakeholders

Depending on the outcome of these discussions, potential areas for collaborative planning or joint initiatives could emerge. For example, local officials can potentially work with the company and other regional stakeholders to coordinate the construction of water pipelines or common waste disposal facilities. These stakeholders may work together to establish educational programs in the region to train local workers in the skills needed at project sites (see Box 10. Examples of Education and Training Programs). 

Local officials could also work with company representatives to hold an informational session or open house about the potential for shale development in the community. Many of the above topics should also be covered in an open house—in particular, it can be helpful to discuss the likelihood that the project will proceed and the length of time operations would last. 

What can be done to address health concerns? What have others done?

Collaborative Activities

Water Quantity 

The issue of water availability is covered in detail in Stage 4—Development and Production when regular withdrawals of large quantities of water come into play. As many of the impacts can be alleviated or avoided by appropriate planning, it is worth considering water management options at this stage of development. Furthermore, operators are sometimes required to submit their plans for water sourcing as part of the permitting process. It can be helpful for the company to develop a water-sourcing plan whether or not it is required, in order to understand existing water sources and demands and how the company’s needs will interact with them.

To find out how water withdrawals and uses are regulated in your state, you can consult with the water quality state engineer at the state’s department of water resources. As part of the information-sharing sessions between local officials and company representatives mentioned above, questions to discuss could include:  

  • What are the sources of water (ground or surface) in your community and how are they used (drinking, recreation, agriculture, livelihoods, energy generation)?
  • What water source will the project use? If relevant, how might it impact other important uses of water in the community?
  • When will the water withdrawals for the project take place?
  • Will the project provide infrastructure that increases access to water? If so, will the community be able to use that water? 
  • What will happen to the wastewater? Will it be treated and returned to the water cycle, injected into rock formations, or reused for operations?

What can be done to address health concerns? What have others done?

LOCAL OFFICIALS

From the outset, local officials could consider conducting—or encouraging their state or federal counterparts to conduct—a Health Impact Assessment (HIA) on potential shale development in their area, usually performed as part of an environmental or social impact assessment. The National Research Council of the National Academies of Sciences defines HIA as follows:

“HIA is a systematic process that uses an array of data sources and analytic methods and considers input from stakeholders to determine the potential effects of a proposed policy, plan, program, or project on the health of a population and the distribution of those effects within the population. HIA provides recommendations on monitoring and managing those effects.” 1

HIAs often contain components of environmental health as well as socioeconomic risk assessment. They encompass a wide range of possible health effects that extend beyond toxicological effects, including 2:

  • air quality
  • water quality
  • noise
  • agricultural uses
  • demographic changes
  • socioeconomic changes
  • traffic changes
  • employment and workforce impacts

An HIA is intended to assess both the risks and benefits of the proposed project in terms of overall community health. In doing so, it helps identify at-risk populations and provides recommendations for how to reduce possible negative impacts. 

Notes:

  1. National Research Council, “Improving Health in the United States: The Role of Health Impact Assessment” (Washington, DC:  2011): 5.
  2. Note that these impacts largely arise beginning in Stage 3 and are addressed there.

What can be done to address health concerns? What have others done?

LOCAL OFFICIALS

Quality of Life—Economic Impacts

It is important to note that local governments may experience a shortfall in funding in the early stages of development due to new demands upon local infrastructure and services, while the government might not receive additional income from production taxes for 2-5 years. 1 Local officials could therefore begin discussions with state legislative and executive branches during the early stages of shale development on how to design a tax structure that allows local governments to receive funding in a manner that meets their communities’ infrastructure and service needs.

The economic impacts of shale development begin to materialize in Stage 3—Exploratory Drilling and are addressed in detail there.

Quality of Life—Noise Impacts

The permitting stage is a good time to consider how to avoid or mitigate many potential impacts, given that siting is a critical aspect of managing the impacts of noise. Some states require a noise mitigation plan as part of the permitting process. Truck traffic to and from the site is another major source of noise that stakeholders can seek to mitigate in this early phase. Local officials can therefore play a role in establishing speed limits for truck traffic, as well as designating appropriate truck routes.

The health impacts of noise are addressed under Quality of Life—Noise Impacts in Stage 3 when sound levels from the project could begin affecting residents.

Quality of Life—Visual Impacts

As with noise, the permitting phase—when plans are reviewed regarding siting and design of the project—is an important time for addressing visual impacts (see Quality of Life—Visual Impacts in Stage 3 for an overview). There are statutory requirements to protect significant scenic, historic, and recreational locations, including at state and federally owned sites. State regulators might conduct environmental impact assessments (EIAs) at this stage, and they could seek the input of municipal authorities on topics such as potential visual impacts. 

For local officials, particularly those in tourist areas with high-value scenery, it can be useful to 1) conduct an early assessment to identify area resources of high visual sensitivity; 2) gather input from residents on their concerns regarding siting; and 3) review local land use ordinances. When there are significant cultural, historic, or natural resources near the planned development site, it may be helpful to conduct modeling or computer simulation of the viewshed, or the landscape/scenery visible to the eye from a fixed vantage point. 2

Notes:

  1. Headwaters Economics, “Oil and Natural Gas Fiscal Best Practices:  Lessons for State and Local Governments,” (November 2012), 3.
  2. See Cornell University study of modeling for the Cayuga Heights and Ithaca overlooks:  Sarita Rose Upadhyay and Min Bu, “Visual Impacts of Natural Gas Drilling in the Marcellus Shale Region,” Cornell University (Fall 2010), 33-34.

What can be done to address health concerns? What have others done?

INDUSTRY REPRESENTATIVES

Stakeholder Engagement

In addition to the above activities, the API Community Engagement Guidelines suggest that operators provide community members with access to a feedback mechanism. For example, some operators have provided an 800 number, which helps them respond to issues as they arise.

This is also a good time to conduct monitoring activities to establish a baseline for air and water quality, as well as ambient noise levels. Having a baseline will be an essential reference point for later monitoring efforts and will help determine the potential impacts of shale development in the community. Some state regulations call on operators to conduct baseline monitoring, particularly for water quality, within a certain distance of the planned site. As outlined in Box 4. Case Study from the Mining Industry:  Good Neighbor Agreement, one option is for the company and the community to undertake a joint effort in water quality monitoring.

What can be done to address health concerns? What have others done?

INDUSTRY REPRESENTATIVES

Quality of Life—Noise Impacts

The best way to alleviate the effects of noise at the well site is by increasing the distance between the source and the person hearing it (“the receptor”). With multi-well pad shale development operations, one pad can drain a larger basin than in conventional oil and gas development, allowing more flexibility with regard to pad location. State requirements for setbacks of well pads from residences vary significantlyIn an RFF survey, 20 states were found to have building setback restrictions for natural gas wellheads, ranging from 100 feet to 1,000 feet, with an average restriction of 308 feet. 1 After examining composite noise levels for various activities involved in shale development, the New York State Department of Environmental Conservation recommended in a 2015 report setbacks of at least 1,000 feet, or even greater distances for multi-well pads. 2

In addition to following setback restrictions, the operator could undertake the following activities in the permitting phase:

  • conducting a noise impact assessment  that accounts for the presence of vulnerable populations or individuals in the vicinity
  • siting access roads as far away from homes, schools, and other sensitive buildings as possible
  • selecting a site that allows the topography or vegetation to act as sound barriers
  • piping  in water and/or recycling it on site to reduce truck traffic to the site (it is worth noting that pipelines have their own impacts, discussed in Appendix E)

Quality of Life—Visual Impacts

As with noise, the operator could seek to avoid visual impacts by siting well pads and access roads away from visually sensitive areas. Mitigation measures to consider during the permitting phase include:

  • minimizing the footprint of the well pad
  • reducing the size of  fluid retention ponds or replacing them with storage tanks
  • using topography or vegetation to screen the site from view
  • seeking to reduce  the visual impact of structures such as compressor stations through design considerations (for example, by emulating the area’s existing agricultural structures) 3

Notes:

  1. Richardson, Nathan, Madeline Gottlieb, Alan Krupnick, and Hannah Wiseman. “The State of State Shale Gas Regulation.” Resources for the Future (June 2013), 24-28.
  2. New York State Department of Environmental Conservation, “High-Volume Hydraulic Fracturing in NYS: 2015 Final Supplemental Generic Environmental Impact Statement (SGEIS) Documents” (April 2015), 7-134.
  3. Earthworks, “Oil and Gas at Your Door?” I-71.

What resources can provide further information?

legislation, regulation, and Permitting Process

  • The Intermountain Oil and BMP Gas Project website is maintained by the Getches-Wilkinson Center for Energy, Natural Resources, and the Environment at the University of Colorado Law School. The Law and Policy page contains laws and policies pertaining to the oil and gas industry in Western intermountain states. See LawAtlas for a review of state laws in shale regions regarding water quality, water quantity, and air quality.
  • The Interstate Oil and Gas Compact Commission (IOGCC), is an organization representing the governors of member states on the responsible development of oil and gas resources. On its website, the IOGCC has a page with links to summaries of state statutes regarding oil and gas development. There is also a table with information on state oil and gas taxes.
  • Ohio Department of Natural Resources (ODNR), Division of Oil & Gas Resources, shale drilling animation (4:12). ODNR’s graphic animation describes the state’s regulatory and permitting activities at each stage of shale development.
  • See Table 2 for a list of state oil and gas regulatory agencies.

Health Impact Assessments

  • Colorado School of Public Health, Health Impact Assessment for Battlement Mesa, Garfield County, Colorado (Denver: 2010). This draft document created by the Colorado School of Public Health, requested by the town of Battlement Mesa, is an example of a community health impact assessment in the context of a potential natural gas development project.
  • International Association of Oil and Gas Producers (OGP), “A Guide to Health Impact Assessments in the Oil and Gas Industry” (2005). OGP is an organization that aims to give oil and gas producers a place to share best practices with others in the industry. The OGP has developed guidance on planning for health throughout the stages of oil and gas operations.
  • Pew Charitable Trusts, “The Health Impact Project.” The project aims to promote the use of HIAs as a decision-making tool for policymakers. The website contains information on the HIA process, case studies, and HIA research and analysis.
  • World Health Organization, “Health Impact Assessment (HIA).” WHO website has tools and guidance on conducting HIAs and a database of example HIAs in a variety of subject areas, including energy.

What resources can provide further information?

Water Quality

  • LawAtlas, “Water Quality:  Permitting, Design, and Construction Map” (updated April 30, 2014). This interactive map displays information on the laws and regulations relating to water quality and shale development in a set of states within the major shale formations. The map is curated by the Intermountain Oil and Gas BMP Project, which is housed at the University of Colorado Law School. It contains information on water quality laws for the following aspects of development:  permitting, design, and construction; well drilling; well completion; production and operation; and reclamation.

What resources can provide further information?

Quality of Life—Economic

  • Bureau of Land Management, Split Estate:  Rights, Responsibilities, Opportunities (2007). This pamphlet for operators and landowners gives an overview of the rights and responsibilities of each party when the federal government owns the mineral rights to the land.
  • Cornell University Cooperative Extension (CCE), “Things to Consider When You Consider Leasing” (2014). CCE’s mission is to solve problems through education and by providing university-based resources to citizens. The website contains information on financial and legal implications of signing oil and gas leases, as well as tips for landowners. See also “Gas Exploration and Leasing on Private Land:  Tips and Guidance for New York Landowners” (updated July 2008).
  • Earthworks, “Oil and Gas at Your Door? A Landowner’s Guide to Oil and Gas Development (Durango, Colorado:  Oil and Gas Accountability Project, 2005). This handbook contains guidance and tools for landowners during the leasing and permitting phase, including a checklist of concerns and an example surface use agreement.
  • The Look before You Lease website provides information and a toolkit for landowners in Ohio, including a sample lease, checklists for negotiating a lease, royalty calculator, and water sampling resources. The website was created by the Rural Action, Ohio State University Extension in Athens County, Athens County Farm Bureau, and Appalachia Ohio Alliance (AOA) with the goal of providing landowners the information they need to make an informed decision about property rights and oil and gas leases.
  • National Conference of State Legislatures (NCSL), “Compulsory Pooling Laws:  Protecting the Conflicting Rights of Neighboring Landowners,” October 24, 2014. This NCSL webpage describes forced or compulsory pooling, gives definitions of relevant terms, and describes the different state approaches to compulsory pooling. It also has a map and table of state compulsory pooling laws. 
  • Elizabeth N. Radow, “Homeowners and Gas Drilling Leases:  Boon or Bust?New York State Bar Association Journal 83, no. 9 (November/December 2011). Law association journal article describes some of the issues involved in signing gas leases for New York landowners, including mortgage and insurance considerations.

What resources can provide further information?

Closure Planning

  • International Council on Mining and Metals, “Planning for Integrated Mine Closure: Toolkit” (London, UK:  2008). The International Council on Mining and Metals is an organization dedicated to improving the sustainability of the mining and metals industry. They use collaborative measures to address sustainable development. This toolkit offers tools and guidance for planning for project closure in collaboration with communities from the initial stages of a project. It was developed for the mining industry, but the tools are useful guides and could be adapted to the oil and gas sector.

What resources can provide further information?

Box 5. Who to Contact about What

With many state, federal, and local agencies playing roles in different aspects of shale development, it can be difficult to know who to contact. We have provided links to resources below on some of the main issues that may arise for local stakeholders.

Oil and Gas Drilling Regulations
See Table 2 for links to state oil & gas regulatory agencies

Information on Oil and Gas Leases
For information:
See Table 2 for links to state oil & gas regulatory agencies

For complaints:
Private Attorney or State Attorney General

Oil and Gas Lease Contract Provisions
Qualified private attorney (personal referral or web/telephone book search)

National Conference of State Legislatures, compilation of state statutes
on forced pooling

Water-Related Issues

Groundwater Protection Council, list of resources

Environmental Conservation Law
U.S. Environmental Protection Agency, list of health and environmental agencies of U.S. states and territories

Land Resource and Conservation Management
National Association of Conservation Districts, state directory of county-specific websites

Mitigation Planning for Pipeline Crossing or Well Site Regulation Affecting Agriculture
National Association of State Departments of Agriculture, state directory

Pipeline Safety
U.S. Department of Transportation, Pipeline and Hazardous Materials Safety Administration, list of state pages

Continue to Stage Three: Exploratory Drilling ➤