US lawmakers seek regulation of drilling practice
By Ayesha Rascoe
WASHINGTON, June 4 (Reuters) - U.S. lawmakers expect to introduce legislation next week that would reverse a Bush era law exempting a controversial drilling practice from federal oversight, possibly driving up costs and curtailing the development of vast amounts of unconventional energy.
Democratic Representatives Diana DeGette of Colorado and Maurice Hinchey of New York plan a bill that would repeal a measure in a 2005 law that excluded the method of hydraulic fracturing from regulation under the Safe Drinking Water Act.
"This is a very serious issue. If it is not addressed, large numbers of people are very likely to suffer," Hinchey told Reuters. "Their water will be contaminated. Their houses will no longer be livable."
Hydraulic fracturing, or "fracking," injects a mixture of water, sand and chemicals into rock formations at high pressure to force out oil and natural gas. The practice is used to stimulate production in old wells, but is now also used to tap oil and gas trapped in shale beds across North America.
Fracking is essential to shale gas production, which has significantly boosted U.S. gas output. The Energy Information Administration estimates this resource could make the United States self-sufficient in natural gas supply by 2030.
The new bill would open the door to Environmental Protection Agency supervision of the practice. Industry groups are concerned the law will lead to a cumbersome federal standard that may require more permitting, higher water quality for fracking fluid and additional testing.
Richard Ranger, senior policy adviser for the American Petroleum Institute, said new requirements could cost as much as $100,000 per well, a significant burden for drillers.
In areas where companies are still exploring, Ranger said "that $100,000 price tag when added to other things can lead companies to say 'No, we're not going to drill here.'"
Lynn Helms, who oversees North Dakota's mineral resources, said fracking is a "critical component" of developing oil and gas from shale in his state and throughout the country.
"Without hydraulic fracturing, under regulation of the states, this resource could not be produced," Helms testified at a House Natural Resources subcommittee hearing on Thursday.
Environmentalists say fracking without a national safety standard endangers human health by contaminating ground water. Residents in gas drilling areas have complained their well water was discolored or foul-smelling and that children became sick.
The bill would also force companies such as Halliburton Co (HAL.N: Quote, Profile, Research, Stock Buzz) and Schlumberger Ltd (SLB.N: Quote, Profile, Research, Stock Buzz) to reveal what chemicals they use to produce hydraulic fracturing fluid, information protected by the companies as trade secrets.
"These fracking fluids use a witches brew of toxic chemicals, nearly all of which are intrinsically hazardous to the environment," Albert Appleton, an environmental consultant, testified at the House subcommittee hearing.
Industry groups say the criticisms are completely unfounded and that gas drilling is done thousands of feet below ground, much deeper than most water resources. Also, they say officials have not linked any public health incidents to hydraulic fracturing.
The stakes are high for U.S. shale producers, such as Range Resources Corp (RRC.N: Quote, Profile, Research, Stock Buzz), Chesapeake Energy Corp (CHK.N: Quote, Profile, Research, Stock Buzz) and Anadarko Petroleum Corp (APC.N: Quote, Profile, Research, Stock Buzz).
"Investors are watching it very closely because if something was to change meaningfully the deployment of the shales for natural gas, it has the potential to dramatically change market conditions," said Christine Tezak, senior energy policy analyst at Robert W. Baird and Co. (Reporting by Ayesha Rascoe; editing by Jim Marshall
WASHINGTON, June 4 (Reuters) - U.S. lawmakers expect to introduce legislation next week that would reverse a Bush era law exempting a controversial drilling practice from federal oversight, possibly driving up costs and curtailing the development of vast amounts of unconventional energy.
Democratic Representatives Diana DeGette of Colorado and Maurice Hinchey of New York plan a bill that would repeal a measure in a 2005 law that excluded the method of hydraulic fracturing from regulation under the Safe Drinking Water Act.
"This is a very serious issue. If it is not addressed, large numbers of people are very likely to suffer," Hinchey told Reuters. "Their water will be contaminated. Their houses will no longer be livable."
Hydraulic fracturing, or "fracking," injects a mixture of water, sand and chemicals into rock formations at high pressure to force out oil and natural gas. The practice is used to stimulate production in old wells, but is now also used to tap oil and gas trapped in shale beds across North America.
Fracking is essential to shale gas production, which has significantly boosted U.S. gas output. The Energy Information Administration estimates this resource could make the United States self-sufficient in natural gas supply by 2030.
The new bill would open the door to Environmental Protection Agency supervision of the practice. Industry groups are concerned the law will lead to a cumbersome federal standard that may require more permitting, higher water quality for fracking fluid and additional testing.
Richard Ranger, senior policy adviser for the American Petroleum Institute, said new requirements could cost as much as $100,000 per well, a significant burden for drillers.
In areas where companies are still exploring, Ranger said "that $100,000 price tag when added to other things can lead companies to say 'No, we're not going to drill here.'"
Lynn Helms, who oversees North Dakota's mineral resources, said fracking is a "critical component" of developing oil and gas from shale in his state and throughout the country.
"Without hydraulic fracturing, under regulation of the states, this resource could not be produced," Helms testified at a House Natural Resources subcommittee hearing on Thursday.
Environmentalists say fracking without a national safety standard endangers human health by contaminating ground water. Residents in gas drilling areas have complained their well water was discolored or foul-smelling and that children became sick.
The bill would also force companies such as Halliburton Co (HAL.N: Quote, Profile, Research, Stock Buzz) and Schlumberger Ltd (SLB.N: Quote, Profile, Research, Stock Buzz) to reveal what chemicals they use to produce hydraulic fracturing fluid, information protected by the companies as trade secrets.
"These fracking fluids use a witches brew of toxic chemicals, nearly all of which are intrinsically hazardous to the environment," Albert Appleton, an environmental consultant, testified at the House subcommittee hearing.
Industry groups say the criticisms are completely unfounded and that gas drilling is done thousands of feet below ground, much deeper than most water resources. Also, they say officials have not linked any public health incidents to hydraulic fracturing.
The stakes are high for U.S. shale producers, such as Range Resources Corp (RRC.N: Quote, Profile, Research, Stock Buzz), Chesapeake Energy Corp (CHK.N: Quote, Profile, Research, Stock Buzz) and Anadarko Petroleum Corp (APC.N: Quote, Profile, Research, Stock Buzz).
"Investors are watching it very closely because if something was to change meaningfully the deployment of the shales for natural gas, it has the potential to dramatically change market conditions," said Christine Tezak, senior energy policy analyst at Robert W. Baird and Co. (Reporting by Ayesha Rascoe; editing by Jim Marshall
Views: 120
Replies to This Discussion
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Permalink Reply by sesport on -
Mmmarkkk - I think I can back that up (if I can find it again). We've had this discussion before, I remember looking at numbers myself and showing that on-road vehicle (ORV) emissions were more than drilling emissions in DFW area. ( I also want to say that discussion involved TX Sharon & Dion?)
If I back it up, will ya' send me some barbeque next time you get the urge to go volatile? lol
best - sesport :0)
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Permalink Reply by Grillin' - MmmMmm on
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I'll get you some "charred beef" when I hit the ignite button!! I'll be grilling some steaks tonight, unless some of those greenie weenies steal my grill since it adds to air pollution. While that seems funny and far-fetched, a few years ago there were some whacko's in California who wanted to regulated outdoor grilling! Even in California these folks were thought to be nuts!
And I'm grilling using natural gas!!! direct hookup to the home gas line, so don't have to worry about those little propane tanks! At the rate my volatile rants are going, I'll use up a couple of HS wells worth of nat gas over the long 4th of July weekend! I'll get a calf butchered, some sausage from Chapell Hill Tx and several cases of Negro Modelo. That should get me through next Thurs and Fri. May have to reload on Saturday!
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Permalink Reply by sesport on
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I recently told him on another topic that the next time he wants volatility to fire up the grill, which he told me he would do with gasoline. The passionate combined with the tongue-in-cheek humor cracks me up!
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Permalink Reply by Grillin' - MmmMmm on
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Okay, went out and bought one of those 5 foot diameter bug blower fans from the Home Depot yesterday to help keep things cooled off on the patio! My wife loves it and wishes we would have bought it a year or so ago to help her with those pesky hot flashes!!
I think the "volatility" may spike tonight if I accidentally turn to ABC and watch their Bobamma Healthcare Infomercial! I might have to start the grilling a little early! Fortunately, the TV is too big to drag out and put it on the grill, but I might be tempted if I had to watch that barf-fest! Wonder what enviromental issues might come from flaming a 57-inch LCD TV? Should I call TCEQ?
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Permalink Reply by sesport on
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FOMCLMAO, you might end up with more issues from your wife than environmentalists & TCEQ. BTW, what kind of barbeque sauce you using on that TV, spicy or honey mustard? :0)
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Permalink Reply by Grillin' - MmmMmm on
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Avoided the TV roast...watched the Tigers put a whooping on the Longhorns in the College World Series! Geaux Tigers!! Completely avoided Bobamma Healthcare Infomercial. Also helped keep down dinner!
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Permalink Reply by Grillin' - MmmMmm on
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The study was recently completed, within 6 months and the government reviewed it and basically said, "uh professor, you must be high!".
I've never said gov't could do no right; they just can't do it very efficiently! But when someone adds 2 plus 2 and gets 650, even gov't scientists can see that's wrong and call "BS"!
Here's the executive summary from the Texas CEQ:
Analysis of Emissions from Natural Gas Production in the Barnett Shale
Executive Summary
Dr. Armendariz’s report Emissions from Natural Gas Production in the Barnett Shale develops an emissions inventory (EI) of oil and gas exploration and production (E&P) activities in the Barnett Shale area. While the inventory estimates appear reasonable, the report depicts an incomplete picture of the entire Barnett Shale EI. Barnett Shale E&P emissions represent only a percentage of the area’s entire EI, which is dominated primarily by motor vehicle nitrogen oxides (NOX) emissions and biogenic volatile organic compounds (VOC) emissions.
When attempting to place Barnett Shale E&P emissions in perspective, the author combines NOX and VOC emissions to create an unrealistically large number that exaggerates the relative significance of these emissions with regards to ozone formation in the DFW nonattainment area.
Combining NOX and VOC emissions as the report does over-simplifies the chemistry that underlies ozone formation. Photochemical modeling of the DFW nonattainment area has shown that ozone is much more responsive to NOX emissions than to VOC emissions, and so reducing NOX emissions is the most effective path to controlling ozone.
The report’s oversights in EI development result in misleading conclusions regarding potential control strategies. Identified emissions reduction opportunities in the report are based on the uncertain assumption that Barnett Shale emissions decreases would significantly reduce ozone formation in the DFW nonattainment area. The TCEQ has already investigated many of the report’s proposed emissions control strategies. These strategies might benefit the Barnett Shale counties, but would not likely benefit the DFW area.
Most importantly, the report ignores data demonstrating that, despite the dramatic increases in Barnett shale gas production since 2000, the long-term trend shows that ozone design values measured in the DFW area have been decreasing.
Adding more control strategies based on short-term changes in emissions trends is often not cost effective, and generates few benefits for improving long-term air quality.
TCEQ, Chief Engineer’s Office, Air Quality Division
Barnett_shale_exec_sum.doc, February 16, 2009
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Permalink Reply by Gary Hogan on
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The simple truth is WHY was the federal Clean Water and Drinking Water Acts loobied for the exemption under Bush / Chaney in 2005 If there is no chance of Water contaimination ? Let us all remember that Mr Dick Chaney was head of Halliburton one of the leading companies in the business of Fracturing wells for production of Oil and Gas. Definite conflict of interest since I well assume he will resume his role in Halliburton after office. War did not do his company badly in the profit margin either. The answer to the original question MUST give citizens a pause for thought and concern regarding the pollution of water resources. If they did not expect to pollute if there was no chance of cross contamination then there was NO reason to lobby for this exemption. BTW the original law in 1972 was instituted because of this very same industrial activity and prior complaints of water contamination by industry. Politicians in this Industries pocket continue to protest that there has not been one case of reported contamination when anyone with a computer can google case after case of everything from well water contamination to pnd water that burns from hydro carbine contamination. Air Quality is also at risk from this activity. Indutry continues to assault and spen millions in propoganda instead of spending dollars to DO IT RIGHT
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