The old adage “let the buyer beware” refers to a time in history when the seller of a product had no obligation to warn the buyer about defects in the product. Today there are several “implied warranty” laws that ensure anyone buying a product has the right to depend on the product being useable for its intended purpose. Although there are numerous laws and regulations enforced by federal, state, and local agencies to help protect the “buyer,” there are still some wrinkles in the process that every individual should know about. This basic rule also applies to land leases – particularly to leases that allow for the extraction of mineral or oil resources from private property.
In Pennsylvania, land leases for the extraction of natural gas from the Marcellus shale formation have become common. Earlier this year the PADEP published a draft policy on the obligation of gas companies to clean up spills of waste materials such as fuel oil and fracturing fluids on private properties throughout the state. The proposed policy provides a set of procedures for oil and gas companies to follow in remediating spills at well pad sites. Of particular interest is the allowance to enter those sites in the PADEP’s brownfield remediation (Act 2) program. The PADEP will allow remediators of spills at oil and gas sites to enter them into the Act 2 program and receive liability protection, based on the fact that a spill of frack fluids would be a spill of residual waste, governed by the Solid Waste Management Act, which is one of the statutes covered under Act 2. In addition, a spill that could impact the waters of the Commonwealth would be regulated under the Clean Streams Law, which is also covered under Act 2.
Act 2: Is It Helping or Hurting Us?
Act 2 is often perceived as a law whose primary intent was to help facilitate the reuse of old industrial sites. Instead of a developer having to figure out how to remove pollutants from soil and groundwater from a former industrial site, it could propose a “cleanup” that eliminates the risk to public health, allowing the pollution to remain in the environment. Capping the land with asphalt and using public water rather than groundwater would limit exposure of persons intending to use the site in the future, and that would suffice to consider the area “clean” under Act 2. However, Act 2 is commonly used for all sorts of contaminated sites, not just the stereotypical abandoned factory. The practical effect of the Land Recycling and Environmental Standards Remediation Act (Act 2) was to shift the principle that governed environmental cleanups inPennsylvaniafrom the use of the best available technology to remove pollution, to one of allowing pollution to remain in the environment so long as it does not threaten public health.
An innocent land owner who is looking for a cash cow and lessees their land to gas companies for the drilling of natural gas wells should be aware, that although Act 2 does offer protection of life and health, at the end of the process contaminants may still remain in place. That means that if a gas company contaminates your soil and/or groundwater, the PADEP will only make sure the company does what is necessary to meet the risk-based standards under Act 2. So, “Let the lessors beware.” You’ll have to protect your own soil and/or groundwater if you are not satisfied with the risk-based cleanup standards under Act 2, and want to ensure that your property is as clean after drilling as it was before.
“Do you have a site that may be environmentally compromised? REPSG can help you sort through process. REPSG offers a range of environmental due diligence, environmental investigations and remediation for private and commercial land owners. Do not hesitate to contact REPSG for all of your environmental needs and questions.