July 21, 2010
This July and August, the U.S. Environmental Protection Agency (“EPA”) is holding a series of public meetings seeking input on the design for an upcoming study to assess the effect of hydraulic fracturing on public drinking water supplies. Hydraulic fracturing uses high-pressured water, combined with chemicals, to release natural gas present underground in shale formations. Use of this process has raised concerns across the country that this process will contaminate, or has contaminated, drinking water supplies. For example, hydraulic fracturing could impact drinking water supplies through the large scale water withdrawals needed to start the process; through the underground leakage of production and/or waste fluids during drilling; through spills of wastewater to land and water surfaces; and through the disposal of waste fluids.
Hydraulic fracturing is an issue of concern to New Yorkers because the state is one of several overlaying the gas-rich Marcellus Shale Formation (the “Formation”). Notably, the Formation includes lands in the watershed that provides drinking water to New York City and, in total, approximately half of the state’s population.
In its Fiscal Year 2010 budget, Congress called upon EPA to commence a new study on the risks that hydraulic fracturing poses to drinking water supplies. Acknowledging that shale gas is projected to comprise over 20 percent of the U.S. natural gas supply by 2020, EPA announced a new study in March. This June, the agency proposed case study criteria and a conceptual modelfor the upcoming study.
EPA is holding meetings this summer to explain the study and to seek public comment on the study’s proposed components. On the east coast, EPA will hold a meeting in Canonsburg, PA on July 22, 2010, and a meeting in Binghamton, NY on August 12, 2010. Further information about the proposed study and the public meetings is available here.
April 28, 2010
On Friday, April 23, the New York State Department of Environmental Conservation (“NYSDEC”) announced that it would exclude the New York City and Syracuse drinking water watersheds from its Final Supplemental Generic Environmental Impact Statement (“FSGEIS”) concerning natural gas development in the Marcellus Shale. Unless and until NYSDEC creates a separate Generic Environmental Impact Statement applicable to the New York City and Syracuse watersheds, each permit application to drill for gas in these areas must be accompanied by a site-specific Environmental Impact Statement (“EIS”). Because an EIS can be lengthy, complicated, and costly—especially if contested in litigation—DEC’s position may discourage gas companies from drilling in these watersheds; some accounts have characterized NYSDEC’s decision as a de-facto ban on drilling in these areas. However, the regulatory limbo imposed on the New York City and Syracuse watershed areas is not permanent; according to the Associated Press, “[t]he DEC and the state Health Department will work with Syracuse, New York City and communities within the watersheds to develop special restrictions for drilling companies seeking permits in the watershed.”
NYSDEC’s decision reflects the competing demands it faces with respect to natural gas development in New York state. The New York City watershed supplies drinking water to over nine million people; the Syracuse watershed supplies roughly 200,000 people. Due to the high quality of this water, both cities are exempt from federal regulations requiring drinking water filtration. Environmentalists and city officials have consistently called for a state ban on natural gas development in the watershed areas in order to protect drinking water sources. However, NYSDEC Commissioner Alexander “Pete” Grannis has expressed concern that an outright ban on drilling in these areas, much of which is privately owned, could give rise to takings claims from property owners deprived of potentially lucrative leasing opportunities.
NYSDEC’s compromise, which was announced without an official written statement, may lower the temperature of the debate surrounding gas production in the Marcellus Shale. It remains to be seen whether the Department’s present action will ultimately result in a solution that is both politically and environmentally tenable.
January 29, 2010
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.”
January 8, 2010
In addition to the New York City Department of Environmental Protection and the Natural Resources Defense Council, the United States Environmental Protection Agency (“EPA”) has submitted comments on the New York State Department of Environmental Conservation’s (“DEC”) Draft Supplemental Generic Environmental Impact Statement (“DSGEIS”) addressing natural gas drilling in the Marcellus Shale formation.
In a letter dated December 30, 2009, EPA expresses several concerns with the DSGEIS. EPA notes that the original GEIS that the DSGEIS supplements was issued in 1992 and expresses concerns that existing conditions may have significantly changed since that time. In addition, EPA asserts that the analysis and discussion of cumulative and indirect impacts in the DSGEIS should be significantly expanded. EPA encourages both the New York State Public Service Commission, which has regulatory authority over the pipelines that would transport the natural gas, and the New York State Department of Health, which has primary enforcement responsibility under the Safe Drinking Water Act, to take a more active role in the SEQRA process.
EPA joins with the DEP in expressing serious concerns over potential adverse impacts to the New York City water supply, and notes that water sources serving upstate communities deserve similar protection. Accordingly, EPA suggests that EPA, DEC and DEP work together to “develop an enhanced oversight approach” that would allow for the coordination of applicable regulatory programs to better protect drinking water supplies that could be impacted by natural gas drilling. EPA also encourages DEC to release information regarding the chemical composition of hydrofracturing solutions, which to date has been closely guarded by industry under claims that such composition represents a trade secret not subject to public disclosure. Access a complete copy of EPA’s comment letter here (pdf).
January 4, 2010
On December 30, Sive, Paget & Riesel (“SPR”) submitted a comment letter on behalf of the Natural Resources Defense Council (“NRDC”) addressing deficiencies in the Draft Supplemental Generic Environmental Impact Statement (“DSGEIS”) prepared by the New York State Department of Environmental Conservation (“NYSDEC”) regarding proposed natural gas extraction from the Marcellus Shale formation in the Southern Tier of New York State. SPR’s comment letter, prepared by Steven Barshov and Jessica Steinberg, focused principally on matters of concern to towns and other units of local government within whose territory such proposed natural gas drilling would occur.
SPR’s comment letter identified multiple deficiencies in the DSGEIS related to potential impacts of concern to units of local government, including traffic, noise, visual, community character and land use impacts. SPR’s comment letter also encouraged DEC to adopt regulations that would provide units of local government with meaningful advisory input to NYSDEC during well permitting. Access a complete copy of SPR’s comment letter—which is attached to NRDC’s comment letter—here (pdf).
December 29, 2009
Last week, New York City’s Department of Environmental Protection (“DEP”) called upon New York State’s Department of Environmental Conservation (“DEC”) to rescind its Draft Supplemental Generic Environmental Impact Statement (“DSGEIS”) addressing natural gas drilling in the Marcellus Shale formation. The Marcellus Shale formation, which contains large quantities of natural gas, extends from Ohio and West Virginia through parts of Pennsylvania and into New York’s Southern Tier. Notably, the formation includes lands in the watershed that provides drinking water to New York City and, in total, approximately half of the state’s population.
DEP has taken the position that any drilling in the watershed should be banned due to risks posed to the drinking water supply by the technique used to extract gas from the underground shale, known as high-volume hydraulic fracturing. In its comments on the DSGEIS, DEP makes a number of arguments to support its contention that the DSGEIS does not adequately analyze the potential significant adverse environmental impacts of drilling in the Marcellus Shale formation, including the following:
The DSGEIS does not adequately analyze the possibility that contaminants may spill into surface waters or migrate underground into natural drinking water supplies or water supply tunnels;
- The DSGEIS’s requirements for the disclosure of the chemicals used in the hydraulic fracturing process are insufficiently protective of human health and the environment;
- The DSGEIS engages in “segmentation” in violation of the New York State Environmental Quality Review Act (“SEQRA”) by failing to adequately analyze potential significant adverse environmental impacts associated with waste disposal, surface water withdrawals, induced growth, cumulative impacts, air quality impacts, pipeline construction, and ancillary infrastructure;
- The no-drill buffer zones proposed in the DSGEIS are inadequate to protect New York City’s drinking water supply; and
- The DSGEIS does not sufficiently analyze alternatives to hydraulic fracturing, and does not at all address alternatives to natural gas development.
DEP also issued a report in conjunction with its comments.
The comment period for DEC’s DSGEIS has been extended to December 31, 2009. While New York City’s interest in upstate drilling is based primarily on potential impacts to its watershed and water supply infrastructure, upstate municipalities are likely to focus on other issues, including tax revenues, road and truck traffic impacts, noise impacts, and preemption of local regulatory authority.
November 10, 2009
Last week, Congress passed legislation that “formally urges the U.S. Environmental Protection Agency to conduct a new study on the risks that hydraulic fracturing poses to drinking water supplies.” The statement, which is found in the 2010 Department of Interior, Environment, and Related Agencies Appropriations Act, calls for a “transparent, peer-reviewed process that will ensure the validity and accuracy of the data.” An earlier EPA study, conducted in 2004, found no risk, but has faced criticism. Current EPA administrator Lisa Jackson has acknowledged that a new study is needed.
Earlier this year, the Fracturing Responsibility and Awareness of Chemicals Act of 2009 (“FRAC Act”) was introduced in both houses of Congress. Currently, hydraulic fracturing is exempted from regulation under the Safe Drinking Water Act (“SDWA”). The FRAC Act, if enacted, would repeal the exemption, thus subjecting hydraulic fracturing to the SDWA’s regulatory scheme and requiring drillers to disclosure the chemical ingredients of fracturing fluid.
Hydraulic fracturing, a process used to extract natural gas from shale, involves the use of high-pressure fluid to fracture underground rock. The exact components of the fracturing fluid are unknown to the public, as drilling companies have maintained that the ingredients are proprietary. Nationwide, concerns have been raised about potential contamination of underground and surface drinking water by the agents and byproducts of hydraulic fracturing.
Last week’s legislation is of particular interest to New Yorkers because a gas shale formation underlies a significant part of the Catskill watershed which provides much of the City’s drinking water supply. New York’s Department of Environmental Conservation has recently released a draft Supplemental Generic Environmental Impact Statement (“DSGEIS”) on drilling in this shale formation. The comment period for the DSGEIS closes on November 30, 2009.
Older Posts »
|
| |
