FracFocus has several design flaws that make it inadequate as a regulatory compliance tool, according to a study conducted by the Environmental Law Program at Harvard Law School.
In a 16-page report, researchers Kate Konschnik, Margaret Holden and Alexa Shasteen said the registry looked promising when it first came online in April 2011 (see Shale Daily, April 6, 2011). But they said the 11 states that use FracFocus — by directing or allowing operators and services companies to list the chemicals used in hydraulic fracturing (fracking) — had acted prematurely or had misplaced trust in the site.
“Our review suggests that FracFocus prevents states from enforcing timely disclosure requirements, creates obstacles for compliance for reporting companies, and allows inconsistent trade secret assertions,” the researchers said. “Furthermore, the reliance on FracFocus by numerous states as a de facto regulatory mechanism sends a strong signal to industry that careful reporting and compliance is not a top priority.”
The Harvard researchers said the states that use FracFocus penalize companies for failing to submit chemical disclosures to the registry, or for filing them late. But the registry doesn’t notify the states when it receives the disclosures, and most states can’t determine when the disclosures were actually made.
“FracFocus 2.0 may be able to provide notification to states when desired,” the researchers said. “However, no state rule requires that FracFocus notify the state when a submission is made.
“The fact that the registry will not offer this service by default may mean that there are technical (database interface), regulatory or political barriers to doing so. How those barriers will be overcome has not been made clear. Meanwhile, even if a state were to begin receiving notifications going forward, there may not be a way to reach back to determine when submissions were made over the past two years.”
None of the 11 states that use FracFocus have set minimum reporting standards, the researchers said, adding that companies that use the registry are left to their own devices because there are no state-specific forms, and FracFocus staff doesn’t review the submissions it receives.
“[Those are] factors that may encourage some companies to undervalue careful reporting,” the Harvard researchers said, later adding that “too often, companies do not provide [any] additional information.”
Another problem with FracFocus, the researchers said, is that the registry provides overly broad protection for what companies would classify as trade secrets.
“Operators posting on the site have sole discretion to determine whether a chemical is a trade secret,” the researchers said. “No substantiation is required, and there is no verification process to determine if trade secret claims meet the OSHA [Occupational Safety and Health Administration] standard, which FracFocus directs companies to follow…there is [also] no process for the public to challenge a proprietary claim.”
The researchers said that although about 20% of all the chemicals used in fracking are not disclosed on FracFocus forms, there were inconsistent attempts at secrecy; many times a chemical will not be disclosed on one form but is disclosed on another.
“By directing or allowing companies to report to FracFocus, states have endorsed implicitly a ‘check the box’ approach to proprietary assertions, with no meaningful oversight,” the Harvard researchers said. “This approach may encourage companies to make [overly] broad trade secret claims, a tendency that appears borne out by the many instances of inconsistent disclosures on the registry.”
FracFocus is jointly managed by the Ground Water Protection Council (GWPC) and the Interstate Oil and Gas Compact Commission (IOGCC). A spokesman for the GWPC could not be reached for comment Tuesday.
“We actually just found out maybe 30 minutes ago that they released the study,” IOGCC spokeswoman Carol Booth told NGI’s Shale Daily on Tuesday. “We haven’t had a chance to look at the report, so we’re not going to comment on something we haven’t read through.” She added that the organization may issue a statement Wednesday on the Harvard report.
The 11 states that use FracFocus are Colorado, Louisiana, Mississippi, Montana, North Dakota, Ohio, Oklahoma, Pennsylvania, South Dakota, Texas and Utah. The U.S. Department of Interior’s Bureau of Land Management has also proposed adopting FracFocus for its reporting needs on federal and tribal lands (see Shale Daily, June 19, 2012).
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