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Bill Would Empower Kansas Regulators on Fracking

A bill advancing through the Kansas Legislature would amend existing regulatory law and give the Kansas Corporation Commission (KCC) explicit authority over hydraulic fracturing (fracking).

According to the text of HB 2526, it would empower the KCC to "promulgate rules and regulations necessary for the supervision and disclosure of any well on which a hydraulic fracturing treatment is performed."

Under current state law, the KCC has the power to regulate the location, design, construction and operation of any oil and gas well in the state. The agency also monitors water quality and handles abandoned wells.

HB 2526 was introduced in the state House of Representatives on Jan. 25. The bill passed the muster of the House Committee on Energy and Utilities on Feb. 6 and the House Committee of the Whole on Feb. 14. The next day the bill passed the House, 124-0 and was introduced in the Senate.

The Senate Committee on Utilities held a hearing on HB 2526 on Tuesday. Edward Cross, president of the Kansas Independent Oil and Gas Association (KIOGA), was one of the bill's supporters to testify before the committee.

"The industry supports this bill," Cross told NGI's Shale Daily, adding that the KCC would regulate fracking better than the U.S. Department of Environmental Protection (EPA). "One of the reasons we support this bill is to keep it at the state level. The regulators live and work here and have every incentive to want to protect the environment as well as the groundwater and drinking water. They're able to regulate the Kansas industry best."

Environmental groups are also supporting HB 2526.

"Our organization fully supports our state regulatory agencies to take care of our natural resources and protect the health of the people," Kansas Sierra Club spokesman Zack Pistora, who also testified before the Senate committee, told NGI's Shale Daily. "We're on the same side as the oil and gas industry in supporting this bill. We need to make sure that they have the best business practices, and they need our opinion on best environmental practices, too."

According to KCC data, 250 horizontal wells were drilled in the state during the current fiscal year (FY), 2011-2012. That's a nearly eleven-fold increase from the 23 horizontal wells drilled during FY2010-2011, and more than 31 times the eight wells drilled during FY2009-10, the first year horizontal wells were drilled in Kansas' southern tier.

Kansas Gov. Sam Brownback recommended that the KCC be allocated about $21.2 million for the 2013 fiscal year (FY), which begins July 1, including $519,977 for the inspection and regulation of fracking wells. But the total represents about a 41% decrease from the $36 million the agency received during FY2012.

KCC spokesperson Bethany Runyon told NGI's Shale Daily the agency currently has 41 full-time field agents for oil and gas wells in the state. "We have a request before the legislature this session for an additional six field agents," Runyon said. "This request was made due to the increased drilling activity that is anticipated in the south central part of the state."

When the KCC put its budget request for FY2013 together last September, it reported to state budget officials that horizontal drilling projects were continuing to move northward, some as far as McPherson County.

"Most of the oil and gas companies involved in this play have related to staff that they have leased many [hundreds of thousands] of acres for the purpose of horizontal drilling," the KCC said. "Most lease terms range from one to three years. Consequently, the same companies are making arrangements to bring [an additional] 15 to 25 drilling rigs into the state in order to drill on these leases before [they] expire. Current staffing resources cannot adequately and timely perform necessary field inspections with this increased level of activity."

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