Ohio’s JCARR Approves New Drilling Rules

Shale Energy Update

Date: May 14, 2012

Overview

On May 7, Ohio's Joint Committee on Agency Rule Review (JCARR) approved long-awaited regulations developed by the Ohio Department of Natural Resources (ODNR) for horizontal oil and gas drilling wells in the state.

The rules specifically relate to drilling permits and well construction and design, and they set industry standards for horizontal drilling activities in Ohio, including those in the Utica and Marcellus shale plays.

The rules apply to both conventional vertical wells and high-volume horizontally fractured wells used in Ohio's deep shale formations.

ODNR said the rules might increase the cost of drilling, constructing and monitoring a traditional well by up to 15 percent, but many of the requirements are already standard practice and most operators will not see an increase.

Ohio's Administrative Procedures Act requires ODNR to publish notice of its intent to adopt new rules and that it invites public comment on the rules. Thereafter, ODNR will conduct a public hearing on the proposed rules. After those procedures have been satisfied, the rules become final and effective. Judicial review then follows.

Once effective, the rules will become a part of Ohio Administrative Code 1501:9.

ODNR officials expect the rules will become effective on approximately August 1, 2012.