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The Derrick: Public Utility Commission Starts Investigation Into Possible Order For Another Utility To Permanently Acquire Venango Water Company Impacted By Conventional Oil Well Spill

On March 12, 2024, The Derrick reported the state Public Utility Commission has started a formal investigation into whether it should order another public utility to acquire the Venango Water Company as part of its recovery from the oil well spill that contaminated the Bellows Spring water supply last July, which led to a “do not consume” advisory in Reno that lasted six weeks.

On February 20, PUC Administrative Law Judge Mark A. Hoyer held a prehearing conference in Harrisburg to begin the process.

This action was prompted by the desire of Randall and Kevin Rhodes, operators of the Venango Water Company for the Rhodes Estate, to cease being certified operators for their water companies.

A prehearing memo to Judge Hoyer from the PUC’s Bureau of Investigation and Enforcement said they were “made aware that Randall and Kevin Rhodes… desire to end their services as certified operators as of December 31, 2023.”

The Bureau then requested a proceeding under Section 529 of the Utility Code on whether to order another utility to take over the Venango Water Company.

Notices of the February 20 prehearing were sent to Randall Rhodes, Secretary of the Venango Water Company; Aqua Pennsylvania, which continues to be under an emergency receivership order from the PUC to operate Venango Water Company; the PUC’s Bureau of Investigation and Enforcement; and the PUC Offices of Consumer Advocate and Small Business Advocate.

At the prehearing, Judge Hoyer “directed the Bureau of Investigation and Enforcement to develop a service list that includes all jurisdictional and municipal utilities in the area that could potentially be capable of running the Venango [Water] system,” according to an email to the newspaper fromm PUC press secretary Nils Hagen-Frederiksen.

“Once that list of proximate providers is established, and those utilities have been notified of the Section 529 proceeding,” he said. “The parties will work on establishing a procedural schedule that includes testimony and evidentiary hearings.”

Hagen-Frederiksen said questions “have been raised” regarding notice to customers and notice to other utilities in the region and that “a long list of preliminary details and procedural issues” must be addressed before a full case schedule can be developed.

“This case is still in its very early stages,” he said.

Another issue raised by the PUC’s Bureau of Investigation and Enforcement is whether to include in the proceeding not only the Venango Water Company owned by the Rhodes Estate, but the six other water companies it owns.

The Estate also owns the Sugarcreek Water Company, West Hickory Water Company, Plumber Water Company, Fryburg Water Company, Cooperstown Water Company and the Blane E. Rhodes Sewer Company.

Notices and documents related to this PUC investigation can be found at Docket No. M-2023-3042180.

Aqua Pennsylvania

Patrick Wenger, Aqua Pennsylvania spokesperson, said the wet fall and winter seasons have allowed the Montgomery-based company to stop hauling replacement water supplies to the Venango Water System because the increased supply from the other approved water sources is adequate.

“Aqua remains ready to haul in water if needed,” he told the newspaper via email.

Wenger also said discussions “remain active” with Franklin on providing a permanent pipeline connection to the system and “terms have been exchanged,” but no agreement has been reached.

Aqua’s quarterly report to the PUC in January said it was looking for possible funding for the pipeline project and for the construction of a new water storage tank from the Pennsylvania Infrastructure Investment Authority.

Wenger said Aqua Pennsylvania “is not actively seeking to acquire” Venango Water Co. However, “it is possible the PA PUC will decide (Order) Aqua to become the Owner of the Venango-Reno Water System.”

No decision has been made by the PUC as of late last week

Spill Cleanup

In July and August of last year, the Department of Environmental Protection ordered Petro Erie, Inc. to clean up the spill of wastewater from its conventional oil wells that contaminated the Bellows Spring water source.

The orders also said Petro Erie, Inc. was to pay for the cost of restoring and replacing water to the Venango Water Company and increased related costs.

Petro Erie, Inc., in September, appealed the orders to the Environmental Hearing Board saying the company “lacked the financial ability to comply with the order.” [Docket: 2023075]

The Board has not scheduled any hearings on the appeal and there has been no progress reported on preliminary discussions on a possible settlement..

DEP’s most recent inspections of the spill area on February 22 and 29, found no progress in cleaning up the contaminated area since last fall.

Thomas Decker, DEP Northwest Regional Office spokesperson, said the agency could not comment on the case because it was under appeal.

Written by David Hess a contributing writer who served as DEP Secretary under Govs. Tom Ridge and Mark Schweiker. He now publishes the PA Environment Digest newsletter.

(Reprinted from The Derrick newspaper.)

(Photos: Added from PA Environment Digest of the spill area impacting Bellows Spring and the Village of Reno water supply.)

Related Article - Village Of Reno:

-- Latest DEP Inspection Shows No Progress By Petro Erie In Cleaning Up The Conventional Oil Well Wastewater Spill That Contaminated The Village Of Reno’s Water Supply In Venango County 7 Months Ago [PaEN]

PA Oil & Gas Industry Public Notice Dashboards:

-- PA Oil & Gas Weekly Compliance Dashboard - March 9 to 15 - Home Explosion; 140 More Abandoned Conventional Wells; Methane In Water Supply; Porcupine Causes Wastewater Spill [PaEN]

-- PA Oil & Gas Industrial Facilities: Permit Notices, Opportunities To Comment - March 16 [PaEN]

-- DEP Posted 76 Pages Of Permit-Related Notices In March 16 PA Bulletin [PaEN]

Related Articles - Gas:

-- Shapiro Marks Plugging 200th Abandoned Conventional Oil & Gas Well: These Companies Will Do Anything To Avoid Paying For Plugging; It’s Not Okay Some In The Legislature Are Shielding Them; Text Well Locations [PaEN]

-- DEP Cites Conventional Oil & Gas Well Operators For Abandoning, Not Plugging 140 More Wells Last Week; Total Now 380 Wells This Year [PaEN]

-- DEP: Conventional Oil & Gas Operators Will Not Be Eligible For New Methane Reduction Well Plugging Grants If They Are Not In Compliance With State Law, Regulations [PaEN]