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Organization Seeks to Create Shale Development Standards in U.S.

An organization that originated in South America wants to create a set of voluntary standards for the oil and natural gas industry to follow for hydraulic fracturing (fracking) and other shale development activities in the United States.

Equitable Origin (EO), which has offices in New York City and Bogota, Colombia, released a first draft of its proposed standards on Monday, calling for greater transparency and accountability by the industry as it develops shale plays.

Specifically, the organization calls for adopting standards on:

  • human rights, social impact and community development;
  • fair labor and working conditions;
  • indigenous peoples' rights;
  • climate change, biodiversity and the environment; and
  • project life cycle management.

"The shale boom enabled by fracking and new technologies has profoundly affected communities and environments in positive and negative ways, making it one of today's most pressing and polarizing issues," said David Poritz, president of EO. "EO is not 'pro-fracking' or 'anti-fracking' -- we simply want to make the fracking operations already happening or about to happen more responsible and accountable."

EO spokesman Josh Garrett said that although the organization currently does not receive any financial support from the oil and gas industry, it does count three former industry members within its ranks. Stephen Newton, a former executive for Occidental Petroleum Corp., is an EO board member; Gilbert Squires, a former president of Conoco Mexico Ltd., serves on EO's Standards Board of Directors; and Rene Ortiz, a member of EO's advisory council, is a former secretary general for the Organization of the Petroleum Exporting Countries.

Garrett added that EO reviews the standards set forth by the International Organization for Standardization (ISO), but EO is not affiliated with ISO.

"Part of what our goal is is to create a comprehensive standard for oil and gas development that brings together all of the different certification schemes that may apply to the industry," Garrett told NGI's Shale Daily on Monday. "ISO is one of those that we look at it and we incorporate into our standard. There are some provisions that are integrated into our main standard."

Garrett said EO was also familiar with the Center for Sustainable Shale Development (CSSD), which was founded in 2013 with four industry participants -- Chevron Corp., Consol Energy Inc., EQT Corp. and Royal Dutch Shell plc (see Shale DailyMarch 21, 2013).

"[CSSD's] work is somewhat similar to ours, although they are limited to the Marcellus [Shale] region, at least for now," Garrett said. "We look to them for some [sense] of what to expect, but I think our approach is very different in that we begin with community engagement.

"What we're looking to do is engage all types of community members and groups that have been affected by shale oil and gas development -- whether they are happy to have it there and are enjoying the royalty revenues from it, or whether they would rather not have it there in the first place. We want to provide a space for people to get together and discuss the positive and negative impacts, view our draft standards, give their input on it and help us develop standards in the future that are feasible for the industry and help reduce industry risk, but also in a comprehensive way address all of the concerns that a community may have with new shale oil and gas development coming into their area."

Garrett said EO hopes to begin applying its standards to specific sites as early as this fall.

According to EO, the organization was founded in 2009. It developed a standard called EO100 for conventional oil and gas exploration and production, and applied it for the first time in August 2014 -- to Canada's Pacific Rubiales Energy Corp. for development at two oil fields in Colombia.

The draft released Monday is a proposed addendum to the EO100 standard, allowing EO to cover shale development. It is available at http://www.equitableorigin.com/media/eoweb-media/files_db/EO100_Standard_Shale_Oil_and_Gas_DRAFT_v2.pdf

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