Regulatory Drilling Practices In The Eastern States
Authors: Dodd Robert L. 
Published: December 2007

Introduction

In the past 10 years there has been a radical change in laws governing the oil and gas industry. These changes are due to environmental emphasis and public support. We have been reluctant to change from the regular way of doing things. The nature of the industry is exploration in low-population, inaccessible areas where it was not considered necessary to take adequate precautions. Oil and gas were and still are a low yield for investors; economy is demanded on every front.

Ten years ago you were lucky if you received $3.00 a barrel for your oil, and 20 cents a thousand for your gas. The economic squeeze has not been eliminated; inflation has taken its toll; the cost of material, machinery, equipment and personnel, life of well contracts, depletion of the more prolific shallow reserves still does not make oil and gas the most appealing investment available.

Many states as well as the national energy policy writes us off as a depleted industry. States, if not by choice, also downgrade our importance by national pressures.

The oil and gas industry cannot be written off; we have a very demanding and important part to play in the energy picture during our lifetimes and that of our children.

There is no utopian cheap fuel of any kind in history. Drilling and producing smaller wells, deeper wells, and enhanced recovery are expensive. With federal regulations on all energy industry, we will continue to be competitive, and the leader in energy resources.

Some of you remember the formation of the Environmental Protection Agency; their first regulations were directed toward Protection Agency; their first regulations were directed toward oil spills. I asked at one meeting, "Why are you directing your efforts toward the oil industry while other, more hazardous and toxic materials are prevalent?" The response was that oil spills could be detected with just a rainbow showing up on the water; therefore, they are the easiest pollutant to detect. The EPA would begin with oil and expand to other areas.

The Santa Barbara Channel and the Michigan gas blowout received national attention and had a great influence on the various state and federal laws. In West Virginia a salt-water pollution problem had a significant effect on their laws. pollution problem had a significant effect on their laws. It is interesting to note as you are reading the various state laws the emphasis that is placed on a single accident or problem, and what the state feels is primarily important in that problem, and what the state feels is primarily important in that specific state.

It is very apparent that all state laws continually are being upgraded to meet federal demands. An excellent example is the EPA. Their regulations allow a state so much time to upgrade their regulations to meet their minimum requirements, or they will be the regulator. They, along with so many federal agencies, have matching money for an assistance program to aid the states in inventories, policing and reporting. One of the basic requirements is for the state's highest elected official to pledge the state to meet their requirements.

In this study we will review the oil and gas laws of Kentucky, Virginia, West Virginia, Pennsylvania, New York, Maryland, Michigan, Ohio, and Tennessee. It is interesting to note in every case that the regulatory agency for oil and gas is a subordinate of some other agency (except Tennessee).

REGISTRATION

In Kentucky there is no defined process for registration. They do require an affidavit of transfer of ownership, and also require bonding by the new owner. In Virginia all drillers, owners, and operators must register. West Virginia requires all owners to register with the department. In case of a corporation or out-of-state owner, a responsible agent who is a resident must be named, and any change in agents must be reported within 5 days.