Montana Administrative Register Notice 36-22-193 No. 1   01/06/2017    
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In the matter of the adoption of New Rule I pertaining to notification of application for permit to drill






To: All Concerned Persons


1. On September 2, 2016, the Board of Oil and Gas Conservation (board) and the Department of Natural Resources and Conservation (department) published MAR Notice No. 36-22-193 regarding the public hearing on the proposed adoption of the above-stated rule at page 1531 of the 2016 Montana Administrative Register, Issue Number 17.


2. The board has adopted New Rule I (36.22.620) as proposed.


3. The board has thoroughly considered the comments and testimony received. A summary of the comments received and the board's responses are as follows:


COMMENT 1:  Commenters submitted comments that support the rule. Multiple comments stated, "[the rule] is an important improvement to the board's administrative rules that will foster robust public participation by better enabling Montanans living near well proposals to take full advantage of the board's broad definition of interested persons and to meaningfully participate in the permit process."


RESPONSE:  The board appreciates the comments and support.  


COMMENT 2:  A commenter submitted a comment that oil and gas operators be required to post a bond on their drilling operations.


RESPONSE: The board appreciates the comment. The rules currently require operators to post plugging and restoration bonds under ARM 36.22.1308.


COMMENT 3:  Some commenters requested a numeric setback requirement ranging from 1,320 feet to at least one mile from any structure. 


RESPONSE:  The board appreciates the comments.  The board established a committee to look at the benefits and concerns associated with establishing a numeric setback in Montana.  The committee concluded a numeric setback distance would be challenging to establish due to the varied oil and gas operations across the state.  The committee felt increased notification would allow better communication between owners of occupied structures and operators, and allow the board to look at disagreements on a case-by-case basis.    


COMMENT 4:  Some commenters requested that written notice be given to owners of occupied dwellings and owners of ground water wells within one mile of the proposed drilling site.


RESPONSE: The board appreciates the comments. Based upon review of historical activity and of existing notice requirements, the committee recommended notification to owners of occupied structures within a distance of 1,320 feet of a proposed well.  The board approved the recommendation.


COMMENT 5: Commenters expressed concern regarding water and soil quality, the risk of groundwater pollution from drilling, and earthquakes.


RESPONSE:  The board appreciates the comments.  The board believes the time to establish protections for water and soil quality, the risk of groundwater pollution from drilling, and earthquakes is during the permitting process.  The new notification rule would notify owners of occupied structures within 1,320 feet of the well site prior to a permit being issued and allow concerns to be brought to the board during the permitting process. 


COMMENT 6:  A commenter requested "reasonable notification" to be more clearly defined.


RESPONSE:  The board appreciates the comment. The board believes that for the purpose of this rule, a specific definition for "reasonable notice" is unnecessary and could hinder the permit applicant's ability to directly communicate with an owner of an occupied structure.


COMMENT 7:  A commenter requested the board adopt the drilling notice and not defer the decision to the legislature. Another commenter disagreed that the board has the authority to adopt the drilling notification and that the upcoming legislative session will have drilling notification legislation.


RESPONSE: The board appreciates the comment. The board has the authority to adopt this rule under 82-11-122, 82-11-127, 82-11-134, and 82-11-141, MCA, and the board voted to adopt the drilling notice requirement prior to the legislative session. 


COMMENT 8:  A commenter stated it is an undue burden on landowners to continually monitor legal postings in the newspapers or online.


RESPONSE: The board appreciates the comment. The new notification rule would require operators to ensure that the owners of occupied structures closest to drilling activity would directly receive notice of the proposed activity.


COMMENT 9:  A commenter requested confirmation that the proposed rule will not replace ARM 36.22.601.


RESPONSE:  The board appreciates the comment. The proposed rule will be in addition to ARM 36.22.601.


COMMENT 10:  A commenter stated that the certificate of service is unnecessary and that failure to provide the certificate of service to the permit applicant and the board should not preclude the opportunity for a hearing.


RESPONSE: The board appreciates the comment. The certificate of service provides evidence that the demand for opportunity to be heard was served upon the permit applicant.  Requiring a certificate of service that the applicant was notified of the potential protest is not unreasonable.




/s/  Linda Nelson                                                       /s/ Rob Stutz

LINDA NELSON                                                        ROB STUTZ

Chair, Board of Oil and Gas Conservation                Rule Reviewer



Certified to the Secretary of State December 27, 2016.

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