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Drillers, Enviros Shake Hands on Marcellus Certification Process

A diverse coalition of often opposing forces Wednesday launched a center to provide producers with certification of performance standards for shale development and established the first 15 standards designed to ensure safe and environmentally responsible development of the Appalachian Basin's shale gas resources.

The Center for Sustainable Shale Development (CSSD) "is the result of an unprecedented effort that brought together a group of stakeholders with diverse perspectives, working to create responsible performance standards and a rigorous, third-party evaluation process for shale gas operations," said Robert Vagt, president of The Heinz Endowments. "This process has demonstrated for us that industry and environmental organizations, working together, can identify shared values and find common ground on standards that are environmentally protective."

Industry participants in the Pittsburgh-based CSSD are Chevron Corp., Consol Energy Inc., EQT Corp. and Royal Dutch Shell plc. Other founding participants are Clean Air Task Force, Environmental Defense Fund, Group Against Smog and Pollution, Citizens for Pennsylvania's Future and Pennsylvania Environmental Council, and two philanthropic organizations -- The Heinz Endowments and William Penn Foundation. Former Treasury Secretary Paul O'Neill will serve as the center's chairman.

In a series of discussion over the past two years, the participants worked to adopt a set of progressive and rigorous performance standards based on current understanding of the risks associated with natural gas development and the technological capacity to minimize those risks.

"I would be less than honest if I said that two years ago there was either clarity or certainty about this outcome, if in fact it would result in anything of merit," Vagt said at a press conference in Pittsburgh. "While the diametrics argued for a stalemate, it was encouraging that all of us came to it sharing a common bond: we recognize that this Marcellus Shale is potentially the most significant economic resource this region has ever known, and we share the imperative that protection of the natural environment is paramount."

"While shale development has been controversial, everyone agrees that, when done, producers must minimize environmental risk," said Armond Cohen, executive director of Clean Air Task Force. "These standards are the state of the art on how to accomplish that goal, so we believe all Appalachian shale producers should join CSSD, and the standards should also serve as a model for national policy and practice."

The organization "is focusing on the establishment of standards that will initially address the protection of air and water quality and climate, and will be expanded to include other performance standards such as safety," said Consol Energy President Nicholas DeIuliis. "Fundamentally, the aim is for these standards to represent excellence in performance."

Companies seeking CSSD certification would have to adhere to the center's performance standards, which include disclosing chemicals used in hydraulic fracturing operations, adopting closed-loop systems and other efforts to reduce wastewater and air emissions from the drilling process. Companies would be audited by an independent contractor. CSSD plans to begin seeking accepting certification applications later this year.

The center also plans to develop programs to share best practices, and it hopes to attract other energy companies to its certification process. CSSD funding is to come from the philanthropic foundations and participating energy companies.

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