Shale Daily / NGI All News Access

North Carolina Frack Bill Passes Senate, Advances to House

The North Carolina Senate on Wednesday passed a bill to legalize hydraulic fracturing (fracking) and begin the process of creating a regulatory framework for the practice.

SB 820 passed its second and third reading by a vote of 29-19. The vote was mostly along party lines in the Republican-controlled chamber, although two Democrats joined 27 Republicans and voted in favor of the bill, while two Republicans joined 17 Democrats in opposition. Before the vote, an amendment supported by Democrats was defeated 30-18.

The bill moved to the state House of Representatives, also controlled by Republicans, where it passed its first reading on Wednesday. SB 820 was subsequently referred to the House Committee on the Environment, which meets on Thursdays. A vote on the bill was not scheduled for the June 7 meeting.

Marty Durbin, executive vice president of the American Petroleum Institute (API), applauded the state Senate's vote. "The legislation provides hope for many new high-paying jobs and a better energy future for North Carolina," Durbin said. "Safe and responsible development of the state's natural gas resources will not only revitalize its economy, it will generate millions of dollars of added government revenue for critical programs.

"Our nation has entered a new era of technologically advanced domestic energy development that will make our nation more secure and more prosperous. The senate vote [on Wednesday] brings North Carolina an important step closer to being part of this new energy future and enjoying the many benefits it will bring."

An amended version of SB 820, also known as the Clean Energy and Economic Security Act, passed the muster of the Senate Commerce Committee on Tuesday. It calls for creating a nine-member oil and gas board and would establish a moratorium on fracking until mid-2014 (see Shale Daily, June 7; May 18). The bill was submitted in mid-May by state Sens. Bob Rucho (R-Mecklenburg), Harris Blake (R-Pinehurst) and Michael Walters (D-Proctorville).

According to media reports, Rucho took issue with a recent suggestion by geologists that North Carolina doesn't have as much natural gas trapped in its shale plays as once believed (see Shale Daily, May 25). During the debate before SB 820's passage, the News & Observer quoted Rucho as telling lawmakers, "the only way you'll ever know is by actually punching down some wells."

Last month Gov. Bev Perdue issued an executive order calling on various state agencies to organize a work group to study fracking and make regulatory recommendations (see Shale Daily, May 23). Perdue's order followed separate reports by the state Department of Environment and Natural Resources and the State Review of Oil and Natural Gas Environmental Regulations Inc. (see Shale Daily, March 26; March 2). Respectively, those reports indicated that fracking could be done safely but that current state regulations were inadequate.

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