On January 26, 2010, shareholders for twelve natural gas companies requested disclosure of environmental and financial risks associated with extracting gas from the underground Marcellus Shale formation through hydraulic fracturing or “hydofracking. ” This proposed process has received a great deal of attention in recent months. Environmental organizations and others have expressed concern that the fracturing chemicals utilized in the process have not been disclosed to the public and are guarded by companies as a trade secret.
The companies from which shareholders are seeking reports include Cabot Oil & Gas Corp., Chesapeake Energy, Exxon Mobil Corp., Hess Corp., El Paso Corp., Energen Corp., EOG Resources, EQT Corp., Range Resources, Ultra Petroleum Corp., Williams Companies Inc., and XTO Energy Inc. In addition to seeking information about the chemicals to be utilized, shareholders are requesting increased transparency of potential environmental impacts, substitution of less-toxic fracturing fluid, and adoption of best practices for drilling activities. As quoted by BNA, Larisa Ruoff of Green Century Capital Management, one of a group of advocacy organizations leading the new shareholder campaign, said “[s]hareholders believe that through the adoption of best practices and policies to phase out the most toxic chemicals used in this process, companies can ensure that they are both protecting the environment and their balance sheets from unnecessary and potentially devastating risks.”