The Northern Plains Resource Council (NPRC) has asked the Board of Oil and Gas Conservation to commence rule making to impose quarter mile (1,320 ft) setbacks of drilling rigs from occupied dwellings. This is a greater distance than the proposal struck down before the legislative Senate Natural Resources committee just months ago, after ample testimony on both sides.

NPRC claims that because other states have imposed setbacks, Montana should follow suit for the benefit of landowners. However, existing statute and administrative rules, along with the structure and function of the BOGC, are a made in Montana solution that works. Using a checklist of out of state rules and regulations to shape policy in Montana is not a good idea. Doing so neglects to take into account those attributes which are unique to Montana.

This Wednesday, at a public meeting before the Board of Oil and Gas Conservation (BOGC), the Montana Petroleum Association (MPA) will be providing comments on how implementation of the proposed rule would negatively impact oil and gas opportunities in Montana, siting that:

• Montana’s drilling and permitting activity pales in comparison to other states who’ve elected to impose setbacks, especially with consideration to densely populated areas
• Other states do not have the same protest ability that Montana landowners do with regard to oil and gas drilling
• The public, including land/surface owners, have considerable access to the BOGC
• Montana’s BOGC is set up to mitigate concerns on a case by case basis; ensuring responsible and efficient development of mineral resources
• If imposed, drilling opportunities in Montana would be severely impacted, with many small and exploratory oil and gas operators essentially placed out of business without the ability to drill into small target formations
• Many claim horizontal wells have greater flexibility in surface placement, however, operators seek to evenly space wells within a DSU (drilling spacing unit)
• Setbacks would reduce the number of wells there could be in a given DSU (within the same lease), shorten laterals, thereby increasing wasted oil and gas reserves, and lessening both production revenue (including that to the state and counties) and royalty payments to mineral owners, which include universities, hospitals, and charitable organizations
• Setbacks neglect to recognize that minerals are the dominate estate (under common law) in split estate scenarios.
• Setbacks act as a taking of mineral owners rights without compensation
• Correlative rights of mineral owners are compromised by setback rules administered as a “one-size-fits-all” rule
• Potential legal conflicts exist with regard to treatment of existing leases under setback rules
• Surface use agreements are currently negotiated between landowner and operator, prior to drilling
• The BOGC sites less than a handful of cases wherein a surface owner came before the Board with a concern over the placement of a well
• The BOGC currently has the ability to exercise authority over well placement to mitigate surface owner concerns when necessary, based on potential harms
• Montana has a longstanding history of environmentally responsible development of oil and gas, without negative impacts on air, soil, or water

The rule would have widespread effects on Montana’s economy and on mineral rights. Mineral owners, royalty recipients, and oil and gas operators with an interest in preserving future drilling opportunities in the Treasure State ought to weigh in at the June 24th meeting at the Board of Oil and Gas Conservation office in Billings, 2535 St. Johns Avenue, at 1:00 pm.

Public hearings will follow at a date TBD, should the Board commence rule making.

Interested parties may contact the Montana Petroleum Association at mpa@montanapetroleum.org to stay updated on the issue, and to be notified of future opportunities for public comment.

Contact: Jessica Sena, 590-8675

#######

SOURCE: U.S. Environmental Protection Agency (EPA)

From Alex Epstein – CENTER for INDUSTRIAL PROGRESS
On Earth Day, I’m asking my friends and fans to join me in celebrating fossil fuels—coal, oil, and natural gas—by watching and sharing “Why You Should Love Fossil Fuels”, a video I helped create with Dennis Prager and his team at Prager University. The five minute “course” has already drawn over 130,000 views since it was posted yesterday. (In comparison, my most-viewed video before this has 22,000.) Please share far and wide, for it’s time we stop thinking about how to save the planet from human beings, and instead resume thinking about how to improve the planet for human beings. — Alex

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Chris Faulkner, aka the “Frack Master” will be one of the featured speakers at the 2014 Black Hills Bakken & Investor Conference October 1 and 2, at the Spearfish Holiday Inn and Convention Center in Spearfish, S.D.

Faulkner is the founder and CEO of Dallas-based Breitling Energy Corporation, an oil and natural gas exploration and production company.  He is the author of The Fracking Truth and producer of the movie Breaking Free: The Shale Rock Revolution.

Faulkner is not shy when it comes to supporting the fracking revolution. According to Faulkner, “Opposition to fracking is driven by junk science and green activist hysteria.”

In an article he wrote for the Los Angeles Register, Faulkner states the following: “Take the argument that fracking contaminates groundwater. The Environmental Protection Agency has extensively investigated this idea and concluded that 1.2 million wells have been hydraulically fractured without a single confirmed case of groundwater contamination.”

Faulkner goes on, “Environmentalists also argue that the technique uses too much water. But it actually takes a mere three gallons of water to create 1 million “BTUs” – the industry standard measurement – of shale gas energy. Producing that same amount of ethanol energy – an environmentalist favorite – requires 15,000 gallons.”

Faulkner, who also co-hosts Powering America Radio, will speak on oil and gas independence in America and how fracking has played the integral part in America’s move toward freedom from foreign oil. After speaking, Faulkner will be presenting a private viewing of the Breaking Free movie exclusively to attendees.

The Black Hills Bakken and Investor Conference is hosted by the South Dakota Oil and Gas Association in conjunction with Black Hills Expo Group.

More information about the Black Hills Bakken and Investor Conference can be found at www.BlackHillsBakkenConference.com

For more information contact:
Branden Bestgen (pronounced bes-jen)
Black Hills Expo Group, LLC
branden@bestgen.us
605-644-6005

Or 

Adam Martin, Executive Director
South Dakota Oil & Gas Association
adam.martin@sdoil.org
605-644-6355

John Driscoll in running for the US House of Representatives for Montana and recently visited with the Bakken Oil Business Senior Editor to share his views on the future for energy in the Big Sky State.

He said he was surprised and delighted to discover crude oil is being shipped from the Bakken by rail to the Columbia River, and then transported by ship to West Coast refineries in California.  It has effectually displaced crude oil which would otherwise have to be imported from Saudi Arabia and other regions in the Middle East and North Africa.

He was posted at the Pentagon and serving his third and final tour of duty as a US Army Colonel, working as a Joint Staff Officer for the Chairman of the Joint Chiefs of Staff, during the 9-11 terrorist attacks.  A few days afterwards he noted on a post incident survey required of those receiving combat pay:  “I was standing just an estimated 100 feet in front of the American Airlines Flight 77 plane after it came to rest in the depths of the building.   On the first deck, a few feet to the right of Corridor 4, I later observed a 20-foot hole blasted through the inner wall of the C Ring, just a few feet from where I was nearly knocked off my feet on the first deck in Corridor 4 at the B Ring.”

He further stated it was a close call and after over 12 years it’s hard to forget 19 out of 20 terrorists were Saudi nationals who hijacked and flew our planes into the World Trade Center, the Pentagon and into a field near Shanksville, Pennsylvania.

He encourages President Obama to approve the Keystone XL pipeline to help address a complex set of challenges we will face in meeting our national energy requirements.  There is need to work together in order to be able to minimize the human, environmental and financial costs of getting the US onto a more secure source of crude oil.

He pointed out there is a need to move quickly beyond the Keystone XL pipeline decision and make plans to build another pipeline, crossing the US-Canadian Border at Sunburst, Montana, upgrading north of the Marias River, accepting Bakken from along the alternate (Tioga) route, proposed by the State of Montana and BLM for the Northern Tier Pipeline, and flowing down the CANAMEX (I-15) corridor to West Coast refineries.

Montanans are capable protectors of Montana’s environment and will bring their environmental stewardship and our personal individual rights to a clean and healthful environment in solving the problems certain to be identified.  This will aid the safer, more efficient and environmentally benign transport of crude oil via pipeline.

His focus will be to encourage efficient development, distribution and use of fossil fuel energy, as the transition to alternate energy resources.

This will assist in freeing up national capital from supporting forward deployment of US military forces to countries with governments hostile to the US.  Private capital can accelerate changing over thermoelectric plants to above 50% conversion efficiency, since they will still have to rely on base-load coal for the intermediate term. Wind, hydro and natural gas energy will have to be integrated on a situational basis as well.

Over the long run the US needs aim toward a robust electricity infrastructure of upgraded transmission lines, including more outside linemen, and high speed electric passenger rail along our Interstate highways, integrated with plug-in hybrid and electric motor vehicles.

We, at the Bakken Oil Business Journal, offer our unambiguous support of a project important to meeting American energy needs, the Keystone XL Pipeline.

The Keystone XL Pipeline is a proposed 1,179 mile, 36-inch-diameter crude oil pipeline that goes through a number of states and provinces on its route south, including Alberta and Saskatchewan in Canada, and Montana, South Dakota and Nebraska in the U.S. Along with transporting crude oil from Canada, the Keystone XL Pipeline will transport oil from producers in Texas, Oklahoma, Montana and North Dakota.

Building awareness of the need for smart policy about our land and waters and how drilling impacts them isn’t an easy sell in a state whose residents continue to derive so much personal financial benefit from the oil and gas industry.

In the matter of Keystone, the environmental lobby is just plain wrong, as it is a safe and needed addition to America’s network of pipelines that gets oil to market. And there is precious little evidence to the contrary.

Until alternative fuel sources become competitive in availability and cost with our existing carbon-based mainstream supply, we have little choice but to rely on fossil fuels. This pesky fact just can’t be denied. Surely, we hope that time will come sooner rather than later, and we heartily support government funding of innovation to speed arrival of that day. But even the most knowledgeable and enthusiastic of environmentalists know that day is not right around the corner.

In the meantime, regardless of the worldwide climate crisis in which we’re fully engaged, it’s in our collective interest to facilitate America’s relentless need for the oil that runs our cars, heats and cools our homes and powers our factories. The Keystone will facilitate this by getting oil extracted from the buried sands of our friendly Canadian neighbor, down to our U.S. refineries to be converted to gasoline and related products.

Recent, objective studies show Keystone to be the safest, most environmentally secure and least expensive means to get the product to market. And now that the U.S. State Department has announced it found no major basis to oppose the project after an intensive and long-awaited review, it’s time for President Obama to provide his needed seal of approval.

Current slate of locations skips coal country altogether

HELENA – Today, Montana Attorney General Tim Fox asked U.S. Environmental Protection Agency (EPA) Administrator Gina McCarthy to add Montana to the agency’s listening sessions on coal regulations. Yesterday, the EPA began its series of listening sessions scheduled to take place in large urban centers: New York City, Atlanta, Denver, Kansas City, Boston, San Francisco, Washington DC, Dallas, Seattle, Philadelphia, and Chicago.

“Montanans care about proposed federal regulations impacting their livelihood, their public schools, their utility rates, their communities, and their environment, and they deserve to be heard on this,” Attorney General Tim Fox said. “It’s mind boggling that the EPA isn’t holding a single session in a state that relies directly on coal for affordable energy, family-wage jobs, and economic development. It’s as if the regulators don’t want to hear from the hardworking folks who will suffer most under the onerous regulations they’re considering. The EPA needs to come here to Montana – to a place like Colstrip or Billings – and listen to what our citizens have to say.”

The listening sessions are designed to gather public input on the agency’s implementation of Rule 111(d) of the Clean Air Act to regulate emissions from power plants. The proposed regulations are targeted at the very coal-fired power generation that provides Montanans with reliable, affordable electricity. Since Montana has more recoverable coal reserves than any other state, the regulations could be all the more devastating.

“The EPA shouldn’t be afraid of listening to viewpoints they won’t hear in New York City,” Fox said.

In his letter to EPA Administrator McCarthy, Attorney General Fox echoed President Obama and members of his administration in calling for an “all of the above” approach to energy policy. “EPA’s recently announced proposals run contrary to a balanced energy approach,” Fox told McCarthy.

Read Attorney General Fox’s letter to EPA Administrator McCarthy here.

-END-
Contact: John Barnes
406-444-2031 | johnbarnes@mt.gov

For Immediate Release
Contact: Jessica Sena, 590-8675

In response to Tom Power’s, “Drill, Baby, Drill”: The Ongoing Economic Fantasy

In light of a recent commentary by Tom Power (former Economics Professor at the University of Montana) it’s apparent that much education is needed on the issue of America’s energy revolution.

Today, Americans are reaping the benefits of readily available, affordable energy. The United States has just been announced the number one energy producer in the world by Wall Street Journal. Last year, families saw energy savings of $1,200 per household thanks to technological advances in unconventional methods of extraction, according to a September IHS report. The Federal Government’s Low Income Energy Assistance Program spent $3.5 billion dollars on 9 million people last year to help pay energy bills, amounting to just under $400 per person. That being said, America’s private energy sector saved families three times more than taxpayer funded government subsidies.

Power points out that oil and gas production have increased three-fold in Montana since 1990. He fails to mention in 1990, production levels were tanking. Tax changes throughout the 90’s, including a production incentive passed by the legislature, stopped the decline & led to an increase in oil and gas production, especially via horizontal wells.

Improved horizontal drilling technology partnered with proven hydraulic fracturing released billions of barrels of oil and gas previously thought to be uneconomic to produce. The production increase led to surpluses of new tax revenues at the state and county levels.

In 1990, state and local tax revenues from oil and gas production totaled just over $30 million dollars for cash starved state and local governments, and schools. Almost twenty years later, in 2008, the total production tax revenue from oil and gas was more than $300 million, with over half that amount returning to the counties for school funding, infrastructure, and public programs. Since 2009, oil and gas production levels have remained relatively constant, providing more than $200 million dollars a year in production taxes alone to the state.

According to Power, Montana’s oil and gas industry “was directly responsible of about one-half of one percent of all jobs in the state” in 2011. As of 2012, Montana’s oil and gas activity actually accounted for roughly 3% of jobs in Montana, or almost 30,000 (direct & indirect jobs) according to economist Patrick Barkey of the Bureau of Business and Economic Research.

Oil producing counties represent the state’s lowest areas of unemployment, according to the Montana Department of Labor & Industry. The report from August of this year lists the following Eastern Montana counties at the top of the list; Fallon County, at 1.5%, Richland County comes in second at 2.2%, Sheridan County at 2.2%, McCone County at 2.3%, Carter County 2.3%, Garfield County 2.7%, Wibaux County 2.8%, and Custer Co. at 3%. Compare those numbers to the hardest hit areas; Sanders County at 10.2%, Lincoln County at 12.1% and Big Horn County with the highest unemployment at 14.3%.

Power criticizes the payroll associated with oil and gas jobs, and claims that, “Oil and gas development is not a likely candidate for substantial job creation.” Really?

On the contrary, the Montana Department of Labor classifies natural resource jobs, along with health care and business services, as one of the fastest growing industries in Montana, with a forecasted growth rate of 2.3% between 2014-2021. In terms of wages, Montana’s oil and gas industry paid an average of $56,581 per worker, 75% above the state average in 2012.

One of the most ludicrous statements in Power’s write up, is the assumption that “few people hold up that phenomenon [Eastern Montana oil boom] as an example of how most Montanans would like to live and raise their kids.”

The Montana Petroleum Association has spent the last year on the road and on the phone speaking with families who express the exact opposite sentiment. Many have claimed that without the oil activity, their families “wouldn’t have made it” through the recession. For some, it’s a family affair, with one or more family members working in the oil field; like Robin Schiele of Helena, and his 22 year old son who lives in Missoula, but works in the Bakken.

Before Robin, the family’s patriarch, was hired for a water trucking company in the Williston Basin, the Schiele family, including Robin’s wife and three children, worked 16 hour days caring for lawns just to pay the bills. The Schiele’s are one of many families who’ve said the Bakken opportunities are what saved their family.

As for those living closer to the bulk of the activity, the sentiment’s the same.

At the Montana Economic Development Association’s fall conference on October 3rd in Sidney, Richland County Commissioner Shane Gorder told attendees, “I want to make one thing very clear. I am excited about our economy. I am glad that our children can return home to work in our area. Growth is positive — bringing jobs and opportunities for our communities.”

Last week, Tracy Kessel, a wife and mother living in the oil patch wrote in to the Sidney Herald, “For those of you who are new to our community…Welcome, you couldn’t have picked a better community to be a part of or raise your children.”

After setting the stage to undermine how prolific the recent expansion in energy production has been, Power defends federal agencies, saying, “Whatever federal energy policy has done, it has not restrained energy production in the United States.” The reality is, though, the federal government and environmental agencies have done nothing to increase energy production either, though they love to take credit for the recent success of the private energy sector.

The federal government leases less than 6 percent of its onshore lands for oil and gas development. Under the Obama Administration, the rate of leasing has slowed by about half. According to the Energy Information Administration, in fiscal year 2011, production on federal lands dropped 13 percent from fiscal year 2010 levels, led by a drop in federal offshore production of 17 percent. The majority of oil production on federal lands (around 80 percent) is located in offshore waters. Furthermore, the rate of permitting has also declined by more than one-third.

These facts show that the trend during the current administration has been toward fewer leases and permits for oil and gas drilling and a longer processing time before approval, in contrast to state programs where permits can be obtained in less than a month.

Additionally, federal agencies like Fish and Wildlife Services, and the Bureau of Land Management, are proposing widespread conservation efforts throughout western states which will have a direct negative impact on current and future development.

In Montana, the BLM has released three resource management plans that call for millions of acres to be restricted from oil and gas leases along the Hi-line and in Eastern Montana. The lack of consideration for the economic impact these management plans would have on Montana’s workforce and budget is egregious. Though new management areas will require funding, BLM Director of Montana/Dakotas, Jamie Connell, says she doesn’t know where new money will come from (Sept. 26th TSRIA meeting, Big Sky).

The record is clear that the current administration under President Obama has been a poor steward of our national energy supplies and our economic security. Take the five year delay on the Keystone XL pipeline approval, for example, which is a project that would provide thousands of U.S. jobs, including ample work for labor unions.

Power’s efforts to downplay the economic contribution of oil and gas to state economies is laughable, but what’s worse, is that he completely misses the point of advocating for multiple use access to federal lands.

Our government is at a standstill because of a massive debt problem and the inability of Congress to agree on how to manage the budget. Last year alone, oil and gas production contributed $283 billion in GDP and $74 billion to state and federal revenues, including more than $200 million to Montana’s general fund (in production taxes alone).

A 5% increase in Montana drilling activity would create 366 more direct jobs, 1,025 indirect jobs, and over $20 million a year in additional state and federal revenue.

As the largest economic driver since the recession, the energy sector is poised to help the federal government alleviate the debt crisis; the opportunity to do so might be a “fantasy”…but the ability…that is a reality.

The Montana Petroleum Report provides information of interest to Montanans. We encourage you to forward this to your friends. — Dave Galt, Executive Director  www.montanapetroleum.org

(HELENA)—Attorney General Tim Fox announced today that Montana has joined nine other western states protesting the sequestration of state funds under the Mineral Leasing Act (MLA).  In a bi-partisan letter to President Barack Obama, U.S. Department of the Interior Secretary Sally Jewell, U.S. Department of Agriculture Secretary Tom Vilsack, and Office of Management and Budget Director Sylvia Mathews Burwell, members of the Conference of Western Attorneys General strongly objected to the loss of revenue, which is statutorily guaranteed to the states.

The Interior Department’s Office of Natural Resources Revenue notified states in March that it would withhold payments from March through July, and possibly August and September, saying the move was required by the 5.1% across-the-board sequestration cuts.  More than half of the  states receive mineral royalties, with western states relying heavily on this revenue because of the disproportionate amount of federal land with valuable minerals located in western states.

The MLA entitles states to 48% of all revenue collected by the federal government for mineral activity on federal lands within state boundaries.  Montana stands to lose nearly $2.4 million in revenue per year based on FY 2012 figures.  “The federal government can’t simply seize Montana’s money to cover its budget shortfalls and out-of-control spending,” said Attorney General Fox.  “Washington needs to balance the federal budget by cutting spending, not by taking money from the states that produce our mineral wealth and without regard for the principles of federalism.”

One-quarter of the sequestered funds were to be paid to the counties in which they were raised; three-quarters of the revenue would go to the State’s general fund.  “Counties typically rely on MLA-generated dollars to help meet their infrastructure needs,” said Harold Blattie, Executive Director of the Montana Association of Counties.  “The funds being sequestered represent over $600,000 that counties use to fund essential services like roads, bridges, building improvements, equipment and vehicles.  This is money Montana counties can ill-afford to lose.”

The ten Attorneys General point out that MLA payments are not subject to sequester for a number of reasons:  First, while mineral royalty payments make a stop in the federal treasury before being returned to the states, that does not convert the royalties into federal money or give the federal government any discretion to decide whether or how much money to return to the states under the MLA.

Second, because the only payments going to the states under the MLA come directly from mineral development in those states, it is an entirely self-sustaining revenue source.  Thus, it is not possible that such payments could be subject to sequestration.

Finally, if payments under the MLA can be deemed an appropriation or expenditure, the Attorneys General argue that the Office of Management and Budget should exempt them from sequestration like many other programs important to economic recovery.

Read the letter here: https://doj.mt.gov/2013/08/montana-protests-federal-withholding-of-mineral-leasing-act-revenue/

 

Opinion Article

“Phelim We Hardly Knew Ye”

By: Bob van der Valk
Dateline: Terry, Montana
June 27, 2013

This opinion article deals with FrackNation as a pro-hydraulic fracturing for oil & gas documentary. Comments, other than my own, were made by individual landowners in the Pennsylvania area where the controversy about hydraulic fracturing had its inception.

Bob van der Valk

FrackNation’s Phelim McAleer has been able to hit Josh Fox’s Gasland and Gasland Part II movies with his best shot making his points about hydraulic fracturing not being the cause for underground water contamination.   Neither is the methane produced by the drilling process resulted in any of the health problems purportedly suffered by land owners where the drilling has been done.

For the last two years Phelim McAleer has made it his life’s calling chasing Josh Fox around the country peppering him with embarrassing questions about ridiculous charges being made in the original Gasland movie.  Gasland was nominated for an Oscar as the Best Documentary of 2010.  Most, if not all, of the charges made by emotionally and financially driven opponents to hydraulic fracturing drilling for natural gas have been debunked by Federal and State agencies, which became involved by reacting to the public attention Gasland initially received.

Recently Phelim McAleer has been showing his FrackNation up against Gasland Part II.  This is leading up to the HBO-TV premiere of Gasland Part II on July 9, 2013. FrackNation will be shown again on AXS-TV July 10, 2013 both of them will get high viewer ship for both cable channels.

What has been lost in this conversation about hydraulic fracturing is the US becoming energy secure once again of having to import crude oil from countries with governments hostile to our way of life. Neither Josh Fox nor Phelim McAleer one have oil industry experience and are continuing this unnecessary raucous to promote themselves.

Sherry Hart

After the Binghamton, New York, February 10, 2013 showing of FrackNation a question was asked by Craig Stephens addressing Phelim McAleer, the producer of FrackNation, about the December 15, 2010 “Dimock Consent Order and Settlement Agreement” (COSA): http://files.dep.state.pa.us/OilGas/OilGasLandingPageFiles/FinalCO&A121510.pdf

Similar to what has happened since the beginning of the Dimock saga, the actual contents and findings of the COSA frequently get overlooked while pro-drillers and drilling opponents continue to banter with each other about the water being poisoned, no it wasn’t, etc.   Phelim’s brief answer to Cabot’s move to settle was that it was a case of corporate business as usual and happens all the time.  Partly true, but anyone who has been following the Carter Road allegations and its resulting mounds of paperwork and legal filings for the last couple of years are familiar with a few things above and beyond his answer:

The PA DEP claimed identification of the migrating gas as being from Cabot’s wells primarily using “presumptive guilt”, based only on proximity to the well, and explains their findings in a the original COSA dated November 4,2009 (http://www.marcellus-shale.us/pdf/Cabot_Consent-Order_11-4-09.pdf) which states starting in January 2009 PA DEP collected samples from water wells providing water to 13 homes which showed elevated levels of dissolved methane as well as identified combustible gas in the headspaces of seven of those water wells.

After the COSA was established, Cabot hired an independent consultant to perform a separate investigation.  According to a review of data on the same exact wells determined to be problematic by PA DEP, Robert W. Watson, Ph.D./P.E. and Associate Professor Emeritus of Petroleum and Natural Gas Engineering and Environmental Systems Engineering, etc. concluded that Cabot was using procedures for drilling, casing and cementing wells even at that time which met or exceeded the requirements of the Pennsylvania Oil & Gas Act, were adequate to protect the drinking water, and which did not cause or allow methane migration into the drinking water. (http://www.cabotog.com/pdfs/Dr_Bob_Watson_WhitePaper_101010.pdf – page 2 and again in the Conclusion on page.

Based upon those findings, and mostly those findings alone, because all of the water supplies were within 1,300 or less feet of a Cabot well and because those wells were drilled within the preceding six months, PA regulations deem a determination of guilt can be made.  (page 3-4, articles J-K): The Pennsylvania Oil & Gas Act: A Summary of Statutory Provisions dated March 2009, Section 208: Protection of Water Supplies (58 P.S. § 601.208) (page 4) states, in part, “There is a refutable presumption that a polluted water supply located within 1,000 feet of a well is caused by the well.” http://law.psu.edu/_file/aglaw/SummaryOfPennsylvaniaOilAndGasAct.pdf  This Summary was written prior to pre-drill tests becoming mandatory, which if anything could well be the most important lesson learned in Dimock.

Other information that could be pertinent is in the legal filings of the lawsuit itself:

1) The Dimock litigants fired their original lawyer when another better known litigation firm offered to take them on as clients.  They walked out leaving $650,294.18 in legal fees unpaid. 2) When the revised COSA was finalized, settlement amounts of the plaintiffs totaled $2,234,160. (2011-11-30 2010 COSA Settlement amounts.jpg).  Amounts of the settlement varied depending on individual property appraisals.  These funds were put into an escrow account to be claimed by December of last year.  There were no restrictions put on this money; it was free for them to collect and they could still continue with their lawsuit and water deliveries would continue.  (2011-12-16 DEP and Cabot Rev Consent Order and Settlement Agreement.PDF)
3) Their original lawyer caught wind of this settlement and put a lien on the escrow account for the outstanding fees the litigants had not paid. (2011-01-12 Motion to demand fired attorneys fee.pdf)
4)  All those persons within the determined effected area and not involved in the lawsuit, claimed their money.  None of the litigants did because doing so would mean paying their first lawyer.  This got muddled in their lies of how Cabot was forcing them to sign non-disclosure agreements and quit the lawsuit… all of which is written into the contract that the money is theirs – no restrictions on it.
5) In August, most of the litigants settled, but do have to abide by a gag order regarding the settlement amounts or findings.  Also, the money contained in the escrow account set up per the COSA goes back to Cabot.  Thus Dan Dinges statement, “The aggregate value of the settlements are not a material item with respect to Cabot’s financial statements,” (statement found in the Philly.com article referenced below.)   I believe there is currently only one remaining holdout, Ray Kemble, who spoke to the Philadelphia Inquirer soon after the settlement offers were made and accepted by the majority of the litigants.  He mentions what his settlement offer was and it appears it was pretty close to the same amount originally offered him in the COSA. (Per Philly.com: http://articles.philly.com/2012-08-27/news/33403570_1_susquehanna-county-town-cabot-oil-baby-drill) “Kemble is angry at just about everybody – Cabot, regulators, his own lawyers, and his ex-wife, who accepted the settlement, thereby reducing the amount offered to him. He said he would only see $79,000 from the deal, after legal fees.”  His ex-wife was entitled to half the amount offered, thus twice the amount Kemble states he was offered is $158,000.  Originally the COSA provided for a settlement offer of $185,712.00.
6) Thus, it appears the litigants were offered just slightly less the amount originally offered without having to access the funds that had liens on them, probably due to lawyer’s cuts, etc.  Settlement discussions began soon after the third set of water test results were released showing, once again, the water tested within acceptable drinking water standards.

This is why Phelim’s response fell far short and was merely the tip of the proverbial iceberg.

Robin Fehrenbach Scala 

Are you hearing that Phelim is actually on the other side?  Or is it a setup so both can profit from the argument and their respective films?  Having met and argued with Josh Fox even before his film came out, I know he is a liar and expect no truth to ever come from his mouth.

It was later that I was contacted by Magdalena Segieda, who is the Director and Producer of FrackNation, in an effort to find people in my area who were drilled and would talk on camera for the film. I met her first and we made some initial contacts, then Phelim and the film crew came out and spent a whole day in my house getting possible scenes with me and Sherry Hart talking about our issues and showing us working the boards and contacting landowners and politicians. (Of all those hours we appear for exactly 2 seconds maybe, which we were happy about).

HBO is trying to justify their financial backing of Gasland and Part II (and Fox in general) so it seems like a good time to spread information, which could be used against Phelim or make him seem like he is just as bad as Fox.

 I also provided money to be executive producer and was involved from before the film was a film. There IS one way to prove who is right, and that is to follow the money. If HBO is really paying for ANYTHING they could prove it. But they won’t.  I trust HBO less than a guy sitting on a street corner with a hat waiting for spare change. Ask them to prove it. They can’t.

By the way, HBO DOES NOT put up those posters.  Phelim does and has since the beginning. It started from his first argument with Josh, where he asked if Josh knew about methane being in the water since the dawn of time, and Josh said, “It is not relevant”

Game On!

Now Phelim makes sure that if Gasland Part II is being shown, FrackNation is also being shown in the same town, biting at the bit for the debate with Josh, but there’s no point holding his breath!

At least HBO did not pay for FrackNation or any part of it or any advertising for it. They DID pay for Gasland and Part II and are now sucking eggs over it.

I never read the account about the arrest of the Julia Mineeva, the former Russian TV anchor, at the premiere of Gasland Part II or if her arrest for trespassing was a set up.  I do know that Josh Fox set up his own arrest (complete with his cameras rolling) at a committee hearing in the House of Representatives so he could use it in Gasland Part II.

The only reason I feel I can stand up for Phelim (though I could be wrong…it is always possible to be wrong) is due to his behavior on all other occasions where I have been with him or them, watching how they react.

See, I am the type who would make the movie and then go broke because I did not attempt to make money for travel and distribution. The movie would then be a waste of time and investor money.

I would hope that Phelim is making SOME kind of money so he does not go broke (as I would, which is stupid) trying to get the word out.

If anyone is being a money hog and pretending to actually care, it is Josh Fox, who will admit it to anyone everywhere except when asked during a screening.

Being a landowner in PA and NY, I felt like I hit the lottery when Phelim and company contacted me to help make the movie. I had no way to educate the public on my own and attempts to find a spokesperson died after speaking to an agent for an hour while finding out what it would cost to get the person I wanted.

Bob van der Valk

FrackNation exposed Josh Fox for the publicity seeker he is. The oil industry needs to have a serious discussion about the urban lies being spread by the likes of Josh Fox. Phelim did a good job on FrackNation and accomplished just that. He is a journalist and should have stuck to bringing out the true facts about hydraulic fracturing.  But we need an independent journalist to tell the true story on how to go about making the US energy secure. The next frontier will be in California with the Monterey Shale Formation coming into play. Their potential reserves of oil & gas is 3 times bigger than Marcellus, Eagle Ford & the Bakken combined.

Robin Fehrenbach Scala

You just explained your position so it makes total sense to me. Phelim has become the story.

Thanks for continuing our conversation until I could “get it”.

Bob van der Valk

God bless the USA!

This editorial was written with the assistance and input of:

• James Asbury – Mansfield, Pennsylvania
• Robin Fehrenbach Scala – Factoryville, Pennsylvania
• Sherry Hart – Tunkhannock, Pennsylvania

Disclosure: Bob van der Valk, Robin Fehrenback Scala and Sherry Hart donated funds to the Kickstarter program and are credited as Executive Producers of FrackNation.

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