Natural Gas Drilling: What We Don’t Know

All Equal Under the Law

The gas industry, and hydraulic fracturing, is subject to widely different laws in different states. Some of those laws are tough, perhaps burdening the drilling industry unnecessarily. Others are lenient, perhaps leaving much of the country subject to environmental danger.

One thing is certain: There is no national standard for an industrial process that is used prolifically in 32 states and will be used even more in the future.

Gas drillers receive special exemptions from seven federal environmental regulations that apply to countless other industrial activities across the country.

Drilling companies are not required, for example, to report the discharge of toxic chemicals for the Toxics Release Inventory under the Superfund law – including the wastewater that threatens Eastern water supplies. They do not have to comply with the section of the Clean Water Act that regulates pollutants at construction sites. And they don’t have to abide by the Clean Air Act, which regulates industrial emissions.

Gas drilling also has its own individual exemption, approved by Congress during the George W. Bush administration, that explicitly prohibits the Environmental Protection Agency from regulating hydraulic fracturing under the Safe Drinking Water Act, the way the agency regulates almost all other types of underground fluid injection, including those injection wells used for wastewater in the West.

The argument behind these exceptions is that state regulations sufficiently protect the environment from drilling. But the result is that drilling regulation is left to a patchwork of state laws.

A recent report by the Ground Water Protection Council, a research group that once had energy executives on its board but now consists mainly of state regulators, revealed that only four of the 31 drilling states it surveyed have regulations that directly address hydraulic fracturing and that no state requires companies to track the volume of chemicals left underground. One in five states don’t require that the concrete casing used to contain wells be tested before hydraulic fracturing. And more than half the states allow waste pits that hold toxic fluids from fracturing to intersect with the water table, even though waste pits have been connected to hundreds of cases of water contamination.

Although energy companies have developed many techniques that can reduce the spills and seepages that have occurred across the country, they are usually left to implement them when and if they choose, meaning protections can be entirely different between drilling fields a couple of miles apart.

In northern Pennsylvania, for example, drillers do not have to supply regulators with a complete list detailing every chemical they will pump underground, while 15 miles away, in New York, state authorities have said that such disclosure is a must because it is essential to protecting the water.

Many scientists and members of Congress are arguing for a sturdier national standard that would require minimum environmental protections and ensure that a national energy policy based on natural gas extraction can be pursued without jeopardizing the country’s other natural resources.

“What we’re talking about is just putting some basic parameters around it,” said Rep. Jared Polis, D-Colo. “If companies are able to operate within those parameters… then that’s fine. If they can’t economically do that, then that is because they are causing more damage than they are creating value, and they probably shouldn’t be operating in the first place.”

Polis is one of 50 sponsors of the FRAC Act, a bill before Congress that would restore the EPA’s authority to regulate hydraulic fracturing under the Safe Drinking Water Act and would require the disclosure of the chemical additives.

Congress also recently asked the EPA to conduct a new peer-reviewed study of hydraulic fracturing’s effect on water resources, reassessing its old position.

On Wednesday, the EPA voiced its most explicit concerns in a decade about the environmental risks presented by drilling, in its response to New York State’s plan for drilling in the Marcellus Shale, the layer of rock stretching from central New York to Tennessee. The agency said it had “serious reservations” about whether hydraulic fracturing was safe to do inside the New York City watershed and urged the state to consider possible threats to public health.

EPA scientists have also told ProPublica that the study suggested by Congress may soon be underway. If that research is coupled with a congressional reversal of the exemption from the Safe Drinking Water Act, hydraulic fracturing could eventually be regulated like any other injection well in the U.S. That would require, among other things, thorough testing of the rock miles below the surface to confirm that it can safely contain whatever is injected into it – a stipulation that addresses some of the uncertainty and is inconsistently found in state drilling laws.

EPA regulation “would essentially create a base level,” said Steve Heare, director of the EPA’s Drinking Water Protection Division in Washington. Under the Safe Drinking Water Act, states “would basically have to make a showing that their regulations were as effective as ours.”

Better Policing

All the laws and protections in the world won’t ensure that drilling can be done safely if effective enforcement isn’t in place to oversee it.

Yet for all the debate about environmental protections, new laws and national benefits, very little emphasis has been placed on bolstering the agencies that issue drilling permits and go out into the field to make sure the processes are done right.

ProPublica’s recent analysis of 22 states that account for the vast majority of the country’s drilling found that regulatory staffing has not kept up with the drilling boom, meaning that the nation’s ability to enforce rules that provide environmental safeguards is systematically weakening.

New York, one of the hot spots expected to supply this gas-based national energy paradigm, has cut its oil and gas regulatory inspection staff 20 percent since 2003, even while it has approved a 676 percent increase in the number of new wells being drilled each year. Other states have added a few people, but almost none have kept up with the crushing pace of new drilling.

In West Virginia, the third most active gas drilling state in the nation, four new enforcement employees have been hired since 2003, but each inspector is still responsible for some 3,300 wells.

“Crisis management is not the best management in the world and we had to deal with crisis management 90 percent of the time,” said Jerry Tephabock, a former head of state oil and gas inspections in West Virginia who retired in 2007. “There were wells out there that had been drilled that have never been inspected in 15 to 20 years.”

Even if states manage to keep staff levels where they are now – a challenge since 39 states have projected budget deficits for 2010 – the growth that would come from placing more emphasis on natural gas as a part of the nation’s energy strategy may still present sizable risks for both the environment and the economy. Either enforcement would have to slacken, or the permitting of new wells would slow so much that it would stifle the economic growth and energy independence that drilling is expected to bring.

Different states are choosing different paths. Texas regulators promise they will issue new permits to drill within 72 hours, even though their regulator-to-well ratio is one of the most demanding in the nation. New York, in contrast, has pledged to bring new drilling to a crawl until its staff can catch up.

Neither approach addresses the scientific or regulatory gaps that represent drilling’s long-term threats to the environment, however. And it remains to be seen whether politicians and environmental regulators will make sure precautions are taken at the beginning of this new energy boom, or if they will leave the nation to clean up the mess after the boom goes bust, as it has had to do so many times in the past.

Article by Abraham Lustgarten, Joaquin Sapien and Sabrina Shankman, appearing courtesy of ProPublica