Natural Gas & Oil

Oil & Gas Development in KY, Threats and Resources

Oil & Gas Development in KY

The first commercial gas wells were drilled in Kentucky in the mid-1800s in Meade County. The majority of oil and gas production in the western coalfield areas of the state and south-central regions. The Eastern coalfield region produces natural gas.

While Kentucky still gets the majority of its energy from coal, natural gas is ramping up as many coal plants are either retiring or converting to natural gas.

Our laws on the books for regulating natural gas in Kentucky are outdated on the whole, and as a result there have been several bills in the state legislature in the past few years that have attempted to address some of the more urgent issues. In the 2015 legislative session, there were bills such as SB 186, signed into law, that attempted to introduce much needed oil and gas production and reclamation protections.

In February, 2015, Kentucky considered its first permit for a deep horizontal natural gas well. Story HERE.

In addition to production issues for natural gas, there has been controversy over the by-products from gas production, particularly Natural Gas Liquids (NGL) which are commonly used in the commercial production of plastics.

Latest tests on the Rogersville Shale formation are still, as of 2019, showing poor results. See article here.

Environmental Concerns

Oil and Gas wells that are no longer in production are required to be properly plugged and abandoned, however many are improperly plugged, illegally abandoned or orphaned.

Drilling, production, and abandonment of wells and leases generate a variety of oil field wastes, in particular, low-level radioactive wastes known as technically enhanced naturally occurring radioactive materials (TENORM or NORM).

Oil and gas companies dredge up radioactive materials when they drill and when they collect wastewater from their wells. No federal regulations exist for such TENORM materials, and oil and gas states have struggled to keep pace with the needs of the industry.

Resources

ACEEE’s 2020 resource brief on beneficial electrification policies, to move communities away from oil and gas HERE.
Kentucky Oil and gas threat map
Kentucky Division of Oil and Gas, link HERE.
Kentucky Geological Survey on Oil and Gas development HERE.
Oil and Gas Data, Kentucky Geological Survey at the University of Kentucky. Link HERE.
Resource for Kentucky maps can be found at the following website HERE.
Kentucky Oil, gas, and coal mine maps HERE.
Kentucky Laws and Incentives for Natural Gas, from US Dept. of Energy (Fuels and Vehicles) HERE.
Kentucky Natural Gas Prices from US Dept. of Energy HERE.
Study of the “Reasonably Forseeable Development of Fluid Mineral Exploration on Bureau of Land Management Lands in Kentucky,” 2008 study link HERE.
Fracktracker Alliance on Kentucky, Link HERE.
“Gas is not Clean” campaign site HERE.
Local resources: Kentucky Beyond Fossil Fuels project.

Legislative Issues and Regional Developments

During the 2020 session, lawmakers passed HB44, “An Act Relating to Key Infrastructure Assets” into law. This was anti-protesting legislation where the original Language changed the definition of “key infrastructure assets” to add natural gas or petroleum pipelines. The law as originally drafted established that tampering with, impeding, or inhibiting operations those assets in the offense of criminal mischief in the first degree. It also allowed for a civil action to be maintained against a person that compensates a person is convicted of criminal mischief in the first degree. The House-amended version removed some of the vague language about “impeding” and “inhibiting” critical infrastructure. For civil actions, it removed liability for those who knowingly “compensate or renumerate” those who violate the Act and replaced language to those who “knowingly direct or cause a person to engage in mischief that involves tampering with critical infrastructure.” The bill still has expanded criminal liability The bill does still include higher penalties for damage of a key infrastructure asset [already illegal]. KCC and our allies at KRC and ACLU worked to make these critical improvements.

The International Center for Not-For-Profit Law tracks laws that affect the right to peacefully assembly. See their protest law tracker here.

Previous Legislative Initiatives

In March, 2016 the Energy and Environment Cabinet convened the Oil and Gas Workgroup to address issues raised in the that year’s legislative session surrounding the illegal importation of wastes with enhanced concentrations of radioactive materials into Kentucky, to review current issues impacting the oil and gas industry and to suggest revisions to statutes and regulations as appropriate.

Oil And Gas Workgroup Report on Technologically Enhanced Naturally Occurring Radioactive Materials (TENORM) Associated with Oil and Gas Activities (2016RS HB563) November 30, 2016.
Report on the Safe Production, Handling and Disposal of Oil and Gas Waste, Dec. 2016.

In 2018, the Kentucky legislature passed a resolution, SR224 (Smith) which urged the U.S. Congress to support federal legislation in advancement of the Appalachian Storage Hub, a proposed $10 billion dollar infrastructure project to house natural gas liquids and related petrochemicals. The U.S. Department of Energy had granted the first part of a two application loan of $1.9 billion for the project, which is expected to include a piping system into the Ohio and Kanawha river valleys.

Appalachian Storage Hub

The Appalachian Storage Hub (ASH), also known as the Appalachian Storage and Trading Hub, is a proposed mega-infrastructure project which could greatly expand unconventional oil and gas drilling (fracking) in the region. Gas and petrochemical infrastructure, such as ethane crackers, could use the natural gas to produce ethylene, which is widely used in plastics and other chemical industries. While commerce interests in the borders of West Virginia, Ohio, Pennsylvania and Kentucky cite the potential for job creation in the four-state region, conservation groups have raised concerns that this facility would create a proliferation of petrochemical industries that would bring public health dangers and contribute to climate change. The resolution was adopted by voice vote. KCC will continue to monitor the progress of this project.

More on the Appalachian Storage Hub:

Secretary Rick Perry announced Appalachian Ethane Storage Hub.
Federal Report Touts Appalachian Storage Hub
Full D.O.E. Report, “Ethane Storage and Distribution Hub in the U.S.” Nov. 2018
Appalachian Underground Natural Gas Storage Hub Clears a Hurdle,” West Virginia Public Broadcasting, Jan. 2018
Ohio Valley Environmental Coalition page on the Appalachian Storage Hub
US Dept. of Energy Report on Appalachian Energy and Petrochemicals HERE.

Pipelines and Pipeline Safety

Natural Gas and Oil pipelines have had their fair share of recent controversy in Kentucky. In 2019, there was a catastrophic explosion of an Enbridge natural gas pipeline in Lincoln County, Kentucky. And in 2014, citizen groups spent several years challenging a proposed hazardous liquids pipeline that would have traversed more than a dozen Kentucky counties. The path of the proposed Bluegrass Pipeline would have carried natural gas liquids from the fracking fields of Pennsylvania, West Virginia and Ohio to processing plants and export terminals along the Gulf Coast.

The Kentucky Public Service Commission’s Pipeline Safety page provides some general resources and public notifications. A grassroots coalition, of which KCC is a part, also maintains an informational website, Kentucky Beyond Fossil Fuels.