Rick Etter, Airports Acquisition Specialist FAA Office of Airports, Planning and Environmental Washington, DC Federal Aviation Administration Guidance

Rick Etter, Airports Acquisition SpecialistFAA Office of Airports, Planning and Environmental Washington, DC

Federal AviationAdministration

Guidance on the Extraction of Gas & Oil on Federally Obligated Airport Property Advisory Circular

FAA Eastern Region35th Airport ConferenceHershey, PAApril 3, 2012

2Federal AviationAdministration

Guidance on Extraction of Gas and Oil on Airport PropertyAEA 35th Airport Conference

April 3, 2012

Background

• Technological advances combined horizontal drilling & hydraulic fracturing in early 2000s

– Deposits previously not tapped

are now accessible

– Current “gas and oil” boom

• Natural gas extraction is the principal focus of hydraulic fracturing.



April 3, 2012

What is Hydraulic Fracturing?

http://www.propublica.org/special/hydraulic-fracturing-national



April 3, 2012

Mineral Shale Deposits in the US



April 3, 2012

Current Regulatory Environment• Mineral extraction activities are permitted by state

agencies or local municipalities. • Statutory exemptions for gas and oil extraction activities

from Federal Law* – Clean Water Act - oil and gas operations exempt except

treatment of flowback or produced water returning to surface if they violate water quality standards.

– Clean Air Act – exemption for aggregation of emissions from oil and gas exploration and production operations

– Safe Drinking Water Act – hydraulic fracturing exempted unless the fluids contain diesel fuel

*These may be regulated by individual states.



April 3, 2012

Public Concerns

•Public is concerned with potential impacts

– Water quality and Emissions are primary concerns

Scranton, PA



April 3, 2012

Changes to the Regulatory Environment

• Congress and EPA are currently considering or reviewing changes to aspects of the statutory and regulatory framework.



April 3, 2012

Changes to the Regulatory Environment• DOE created a Natural Gas Subcommittee to make

recommendations to improve the safety and environmental performance of natural gas hydraulic fracturing from shale formations as part of the President’s “Blueprint for a Secure Energy Future.”

– Committee issued final report on November 18, 2011.

• In February 2012, BLM has issued draft rules on hydraulic fracturing on federal lands requiring:

- disclosure of chemicals used;- the amount and source of fracking water;- the plan of disposal and reporting actual disposal materials; and- tests to ensure well bores maintain their integrity.



April 3, 2012

FAA guidance on gas and oil leases

• Gas and oil operators, as well as airport sponsors, are interested in extracting oil and gas resources located under airport land.

• Airport sponsors must maintain safe airport operations and adhere to grant obligations and assurances.

– Preserve Rights and Powers / Good Title

– Fair Market Value Revenue

– Prevention of Hazards and Obstructions

• The guidance does not encourage gas and oil leasing on-airport property.



April 3, 2012

Gas and Oil Operation on-Airport• Current Oil and Gas Operations on-Airport

– FAA Airports Regions who have or are currently reviewing gas and oil leases for on-airport

• AEA – New York, Pennsylvania, and West Virginia • AGL - North Dakota, Ohio and Michigan • DFW and surrounding areas

– DFW is a large scale on-airport shale gas development

– DEN is conducting its own gas and oil operations

• It is anticipated that more airports will be approached by developers as areas are tapped.– Most active shale formations currently

• Marcellus Shale in the North East• Barnett Shale in Texas• Haynesville/Bossier Shale in Louisiana• Bakken Shale in North Dakota



April 3, 2012

Background on Guidance

• AEA Region prepared mineral extraction Guidance in October 2010

• New York delegation visited in January and May 2011

• FAA committed to establishing National Guidance to facilitate consistent application of FAA requirements for gas and oil leasing and on-airport development.



April 3, 2012

Background on Guidance• Established a working group to draft guidance (January

2011).

– APP 400 – ACO 100 – AAS 300 – AGC

- Region and ADO representatives • AEA,

• ASW,

• AGL and

• ANM



April 3, 2012

Advisory Circular – Goals / Objectives• Provide consistent guidance for airport sponsors to

develop gas and oil leases and development proposals in compliance with their Federal obligations;

• Incorporating existing FAA requirements for:– Airspace/Aeronautical Studies and Notifications;– On-airport Construction and Development;– Airport Planning; – Environmental Documentation; and – FAA revenue use policies.

• Provide FAA field offices on what is needed for gas and oil project review



April 3, 2012

“It’s an Airport not a Gas/oil Field”

• Any exploration or development on Airport Surface Land must be subordinated to FAA Safety and Operations Standards and Requirements.

• Gas and oil leases must restrict access and use of airport operational and aeronautical development land. (No drill zones defined)

• Airport Design and Construction Rules must be applied. (airspace, hazard elimination/prevention, environmental compliance, etc).

• FAA must Approve Changes to the Airport Layout Plan (ALP).• Lease is Contingent on ALP approval• NEPA Review for FAA Approval

• Gas and Oil leases terms and provisions must be at Fair Market Value (Signing bonus, royalty, surface land rents, terms and expiration provisions.)



April 3, 2012

Outline of Guidance• Chapter 1 provides a brief overview of gas and oil production in the

United States.

• Chapter 2 provides the airport sponsor with FAA requirements and recommendations on how to develop acceptable on-airport gas and oil development plans and proposals.

• Chapter 3 provides an overview of the FAA review process and submittal documentation requirements

• Addendums: – Listing of Recommended and Required Gas and Oil Lease Terms and

Restrictions– Listing of Government Agency References and Authorities Associated with

Shale Gas and Oil Development (i.e., EPA, DOE, BLM, state gas and oil development agencies, etc.)



April 3, 2012

Next Steps• Finalize a Draft Advisory Circular “Guidance on the

Extraction of Gas and Oil on Federally Obligated Airport Property”

• Meet with Resource Agencies

• Circulate for internal FAA review (ARP, Regions, other FAA Offices)

• Federal Register notice for public review and comment



April 3, 2012

Thank You!

Documents

Rick Etter, Airports Acquisition Specialist FAA Office of Airports, Planning and Environmental Washington, DC Federal Aviation Administration Guidance