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The Derrick: State Attorney General Launches Criminal Investigation Into Conventional Oil Well Wastewater Spill That Contaminated Venango Water Company Spring

This article first appeared in The Derrick on March 8, 2025--

A court document filed with the state Environmental Hearing Board confirms the state Office of Attorney General is investigating the oil well wastewater spill that contaminated the Venango Water Company’s Bellows Spring in July 2023 that led to severe drinking water problems for customers in the Village of Reno, Venango County..

This comes as the Environmental Hearing Board is considering an appeal filed by Petro Erie Inc., the owner of the conventional oil well wastewater tanks the Department of Environmental Protection said were the source of the spill.

Petro Erie appealed the order DEP issued requiring the company to clean up the spill and pay any added costs to provide clean water for customers of the Venango Water Company.

On February 24, attorneys representing Petro Erie, Inc. and DEP filed a formal motion with the Environmental Hearing Board to delay consideration of the appeal as a result of the investigation of the Attorney General’s Office.

The attorneys said in the document, “Petro Erie informed the Board [on February 13] that Petro Erie’s principal, Harry Rhoades, had been visited and interviewed the previous week by Special Agents of the Pennsylvania Office of Attorney General, Environmental Crimes Section.

“In addition, undersigned counsel for Petro Erie [Matthew L. Wolford] confirmed with Deputy Attorney General Brandon Bingle that a criminal investigation into the circumstances giving rise to the [DEP] Administrative order and this appeal is ongoing.

“Consequently, Petro Erie requested that the instant civil proceeding be stayed until such time as the possible criminal case is completed,” according to the document.

DEP said in the document it agreed with the motion to delay consideration of the appeal for 90 days.

Petro Erie and DEP had been negotiating a proposed agreement to resolve the issues raised in the appeal.

However, once the criminal investigation came to light, Petro Erie said it is “unwilling to execute a consent order and agreement until the possible criminal case is completed,” according to the court document.

The document said both parties had reached a “tentative agreement” on findings in a proposed consent order and agreement, but there was “substantial disagreement” on the amount of any civil penalties.

Findings in a consent order can deal with the admission of responsibility for actions.

The document also noted “Findings could be used as admissions in a criminal case.”

Attorneys for both sides said in the document, “it is generally viewed as inadvisable to continue with a civil proceeding [the Board appeal] until after the criminal proceeding is concluded, as failure to stay the civil proceeding may be prejudicial to both the defendant and the government.”

On February 25, Environmental Hearing Board Chief Judge Steven C. Beckman issued an order again delaying consideration of the appeal and requiring a status conference call on the case with both parties “in approximately 60 days” (April 26).

Documents related to this appeal are in Environmental Hearing Board Docket No. 2023075.

Documents related to the Public Utility Commission proceeding on the Venango Water Company and six other Rhodes Estates water utilities can be found at PUC Docket No. M-2023-3042180 and I-2023-3042312.

Visit the Aqua Pennsylvania Rhodes Utilities webpage for more information on the Rhodes Utilities Receivership.

Visit DEP’s Venango Water Company/Petro Erie, Inc. webpage to learn more about the actions taken by DEP.

(Photos: Row 1- Conventional oil well wastewater spill area; Row 2- Aqua PA bulk water hauling to keep water flowing to customers; DEP sampling drinking water.)

NewsClip:

-- The Derrick: Attorney General Launches Probe Of Reno Spill [PDF of Article]

Resource Links - Reno Oil Wastewater Spill:

-- The Derrick: Aqua PA Spells Out Venango Water Co. Expenses Since Its PUC-Ordered Emergency Role [Conventional Oil Well Wastewater Spill Cost Water Customers $900,000, So Far, In Venango County] [PaEN]

-- The Derrick: PUC Judge Issues Emergency Order Appointing Aqua Pennsylvania As Temporary Operator For 6 Rhodes Estate Water Companies [Serious Community Impacts Continue From Conventional Oil Well Spill In Venango County] [PaEN]

PA Oil & Gas Industry Public Notice Dashboards:

-- PA Oil & Gas Weekly Compliance Dashboard - March 1 to 7: Cryptocurrency Facility, 9 More Shale Gas Wells Abandoned; Attorney General Investigates Conventional Wastewater Spill; Pipeline Ordered To Provide Clean Water [PaEN]

-- DEP: Diversified Production LLC Abandons Shale Gas Powered Cryptocurrency Facility In Elk County; 9 More Violations For Abandoned Shale Gas Wells This Week [PaEN]

-- DEP Orders Energy Transfer/Sunoco To Install Water Treatment Systems In Over 200 Homes Impacted By Petroleum Products Pipeline Leak In Bucks County [PaEN]

-- PA Oil & Gas Industrial Facilities: Permit Notices, Opportunities To Comment - March 8 [PaEN]

-- DEP Posted 92 Pages Of Permit-Related Notices In March 8 PA Bulletin [PaEN]

Shale Gas & Public Health Conference: