View this article online: https://www.insurancejournal.com/news/national/2015/03/22/361635.htm
The Obama administration issued the first federal regulations for fracking since the drilling technique fueled a domestic energy boom, requiring extensive disclosures of the chemicals used on public land.
After years of debate and delay, the Bureau of Land Management on Friday said drillers on federal lands must reveal the chemicals they use, meet well construction standards and safely dispose of contaminated water used in fracking.
The rule had been highly anticipated by drillers, who oppose added regulation, and by environmentalists who have raised alarms about water contamination. Both sides had complaints with the outcome: groups representing the oil and gas industry sued to block its implementation and an environmental group said the regulation favored industry over public health.
“This rule will move our nation forward as we ensure responsible development while protecting public land resources,” Interior Secretary Sally Jewell said on a call with reporters. “As we continue to offer millions of acres of America’s public lands — your lands — for oil and gas development, it is critical that the public has confidence that robust safety and environmental protections are in place.”
Domestic production from more than 100,000 wells on public lands accounts for about 11 percent of U.S. natural-gas production and 5 percent of oil production. Fracking, or hydraulic fracturing, is a technique in which water, chemicals and sand are shot underground to free oil or gas from rock. It is used for about 90 percent of the wells on federal lands.
The rule, which is set to take effect in three months, triggered criticism from environmental groups, which said the regulations put industry interests ahead of public health, and from congressional Republicans the oil and gas industry.
The Independent Petroleum Association of America and the Western Energy Alliance filed a lawsuit against the Interior Department, saying the regulations are the product of “unsubstantiated concerns,” and lack evidence necessary to sustain them. The group asked in a lawsuit filed Friday in a U.S. court in Wyoming to have the new rules declared invalid.
“Interior’s $5,000 a well cost estimate is laughable,” Kathleen Sgamma, vice president for government and public affairs at the Western Energy Alliance, said in a telephone interview. The final rule adds costs atop those estimated at $97,000 a well in the Alliance’s review of the proposed regulation, she said.
Senate Energy and Natural Resources Committee Chairman Lisa Murkowski, an Alaska Republican, said the rule may “make it even harder to produce oil and gas” on public lands.
The rule “adds unnecessary, duplicative red tape that will in turn make it more costly and arduous for our nation to pursue energy security,” Senator James Inhofe, an Oklahoma Republican and chairman of the Environment and Public Works Committee, said. Inhofe on Thursday introduced legislation to keep regulation of fracking under state oversight.
Environmental groups such as the Natural Resources Defense Council say fracking mishaps have led to contamination of local water wells in communities from Wyoming to Pennsylvania. They urged BLM to tighten its earlier plans on exemptions for chemical disclosure and the use of open pits to dispose of flowback water.
“These rules put the interests of big oil and gas above people’s health, and America’s natural heritage,” said Amy Mall, who directs the fracking advocacy at the Natural Resources Defense Council. “The bottom line is: these rule fail to protect the nation’s public lands — home to our last wild places, and sources of drinking water for millions of people.”
Under BLM’s plan, drillers must disclose the chemicals they use to the industry-supported website, FracFocus.org. As a result of those filings, BLM will become the largest consumer of that website, and will attempt to improve it so that it’s of better use to the public, the agency said.
Environmental advocates said it was a mistake to rely on that website before the improvements were agreed to and in place.
“FracFocus has said it will be making improvements, but we have concerns,” Mall said.
Environmental groups also are prodding the Environmental Protection Agency and BLM to issue tight restrictions on methane leaks from fracked wells, a source of greenhouse gases.
BLM, the largest landowner in the U.S., oversees about 700 million acres of mineral rights underground. Farmers or ranchers own the surface rights on large tracts of federal land.
–With assistance from Andrew Harris in federal court in Chicago.
Related: