Non-Conforming Spacing Unit Procedures
The Department will begin accepting applications for non-conforming spacing units on July 16, 2007.
These procedures apply to proposed natural gas well spacing units which are outside of natural gas fields or pools which were discovered, developed and operated prior to January 1, 1995, and which:
- do not conform to statewide spacing as defined by ECL §23-0501(1)(b); and/or
- are not of approximately uniform shape with other spacing units within the same field or pool; and/or
- do not abut other spacing units in the same pool, unless sufficient distance remains between units for another unit to be developed.
Department Staff will determine that a non-conforming unit meets the policy objectives of ECL §23-0301 only after review of sufficient technical justification, including the following:
- Completed application form and completed application for a well permit, including a spacing unit map. (See links at the right).
- Map of the spacing unit and immediate vicinity showing structural contours of the target formation, pay thickness contours, faults, water contact and/or other areal or interpretive depiction which illustrates geologic conditions that result in the need for a non-conforming unit;
- Written description and analysis of the scientific data intended by the applicant to support the proposal. Acceptable scientific data includes, but is not limited to: seismic reflection data, geologic data, well log data, reservoir engineering data and well testing data. The extent of actual scientific data to include in the initial application is at the applicant's discretion with the understanding that the Department may require submission and/or presentation of additional data if necessary to make the required determination;
- Proposed adjustment of the allowable production, if any, and supporting technical justification;
- For pre-existing fields with one or more non-conforming spacing unit orders issued after August 2, 2005, the previously issued spacing order may be proposed as justification in lieu of scientific data;
- For proposed 40-acre Queenston spacing units in Erie, Genesee, Wyoming, Allegany, Livingston, Ontario, Yates, Seneca and Cayuga Counties, the previously issued FERC tight formation determination (FERC Order 280) may be proposed as justification in lieu of scientific data; and
- The name, business address and experience of any expert witness who will be called to support the non-conforming unit proposal at the spacing unit hearing if one is required.
Application Review Process
- The application for a non-conforming unit will be submitted to the Bureau of Oil & Gas Regulation in the Albany office concurrently with submission of an application for a well permit to the regional office.
- Regional permitting staff will conduct an environmental review and pre-site inspection and convey any areas of concern to the applicant.
- The application will be date stamped upon receipt in Albany, and non-conforming unit proposals will be reviewed as expeditiously as possible in the order they are received.
- The Bureau of Oil & Gas Regulation will send a written determination of completeness regarding the technical justification for the non-conforming unit. The applicant should not contact the Bureau for technical discussions prior to receiving this written determination. Upon receiving a notice of incomplete application the applicant may contact Albany staff to request a technical meeting to present the required additional justification. The meeting will take place no sooner than two weeks following the request unless Bureau staff schedule an earlier meeting date.
- Upon determining that a proposed non-conforming spacing unit meets the policy objectives of ECL §23-0301, Department staff will initiate the "Procedures for Spacing Hearings for Non-Conforming Units" set forth in DEC Program Policy DMN-1.
Future Pool Development
The spacing order for the initial non-conforming unit in a field or pool will state that future units in the same field or pool will either conform to statewide spacing or will be of similar size and shape to the first non-conforming unit unless otherwise justified.
Notice per 23-0503(3)(b) is required for a proposed spacing unit which conforms not to statewide spacing but to the previous spacing order. However, the prior spacing order will suffice in place of repetitive technical justification submitted by the applicant. The justification which supported the initial spacing order is not subject to rehearing [see 6 NYCRR 550.4(f)].