States and producers Monday called on the Obama administration to either withdraw or suspend a proposed rule that would require companies to publicly disclose chemicals used in hydraulic fracturing (fracking) operations on federal and Indian lands. Environmental and conservation groups lobbied for the federal government to tighten the rule.
The Interior Department’s Bureau of Land Management (BLM) “should suspend this rulemaking until it conducts [a] thorough economic and federalism analyses required for rules costing society over $100 million and impacting the relationship between states and the federal government,” wrote Utah’s Duchesne County Commission in a letter to the agency.
It said economic research firm John Dunham and Associates reviewed the BLM rule and found that the total cost to society would be $1.4-$1.6 billion annually, or about $253,000 per well. The agency’s fracking rule was issued in May (see Shale Daily, May 7).
Moreover, the “BLM is moving forward, under pressure from environmental extremists, without being informed by the scientific conclusions and recommendations of the study” being conducted by the Environmental Protection Agency of the impacts of fracking on the environment and public health, the Utah commission said in its comments on the rule, which were due at BLM Monday.
“We know of no incidents of contamination from fracking on public or other lands in our county and the BLM has offered no sound justification for proceeding with the development of these rules.”
EOG Resources, Houston-based EP Energy and Yates Petroleum Corp., in separate filings, asked the BLM to reconsider the rule. “I urge the BLM to withdraw this rule and begin working with the states to address any issues the agency feels need to be clarified regarding oil and natural gas activities,” said John Jensen, executive vice president of operations services at EP Energy.
“The BLM should look for opportunities to work with the individual states and allow them to do their job, not enact another set of burdensome regulations that will only further drive small oil and gas producers from operating on federal lands,” he said.
“Yates understands the BLM’s motivation to adopt the proposed [fracking] rule in light of the fact that existing federal [fracking] rules are over 30 years old. However, state agencies have been effectively regulating oil and gas operations, including hydraulic fracturing, for over 60 years,” said Casper, WY-based Gene R. George & Associates Inc., which filed comments on behalf of Yates Petroleum.
“We strongly urge the BLM to reconsider adoption of the proposed hydraulic fracturing rule and leave the regulation of such operations to the state regulatory agencies, especially in states such as Wyoming, New Mexico and North Dakota that have proactively adopted hydraulic fracturing regulations to supplement existing oil and gas regulations in recent years,” the firm said.
The “rule goes far beyond disclosure of hydraulic fluids and includes wellbore construction standards and water regulations that directly encroach upon individual states,” said Denver-based Black Hills Exploration and Production.
Moreover, “the time delays and uncertainty this rule imposes will further cloud a leasing process on federal lands that is becoming untenable for America’s small oil and natural gas operators. At a time when the federal government should be looking for ways to encourage oil and natural gas exploration on federal lands, the proposed rule adds more layers of regulation on a system that is already overwhelmed.”
The Natural Resources Defense Council (NRDC) Monday filed comments on behalf of a number of groups, including the Sierra Club, The Wilderness Society, Southern Environmental Law Center, Western Environmental Law Center, Earthjustice, the Powder River Basin Resource Council and the Upper Green River Alliance.
“Given all the growing body of work regarding the risks of hydraulic fracturing, the public expects urgent and meaningful action from your agency” on this issue, said the NRDC. “Both well stimulation and the handling of flowback fluids can cause significant environmental damage. [And] because of these risks, well stimulation must be prohibited in certain environmentally sensitive areas.”
The environmental and conservation groups recommended that the agency identify areas that will be completely off limits to oil and gas drilling; establish safe setback distances of drilling activity from schools, hospitals and drinking water supplies; ensure adequate well casing and water protections; strengthen the disclosure standards for oil and gas producers; and protect national parks from drilling.
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