August 8, 2011
With the Environmental Protection Agency (“EPA”) largely barred from regulating hydraulic fracturing (“fracking”) under the Safe Drinking Water Act, regulatory proponents have turned their attention to alternate means of controlling the industry’s environmental impacts. Last month, EPA proposed the first federal rules limiting air emissions from fracking operations, and on August 4, a coalition of environmental groups petitioned EPA to require the testing and disclosure of fracking fluids under the Toxic Substances Control Act (“TSCA”). Others have turned to the courts to compel greater environmental review of fracking’s impacts, with a new suit filed in the United States District Court for the Eastern District of New York late last week.
On July 28, 2011, EPA proposed a suite of new Clean Air Act rules governing the emission of volatile organic compounds (“VOCs”), sulfur dioxide, and air toxics from oil and gas extraction and transmission activities, including the first federal air standards for hydraulically fractured wells. During fracking, VOC emissions are often elevated during “flowback” periods, when fluids injected into wells return to the surface carrying contaminants that can evaporate into the air. EPA’s proposed rules would require wells to separate and capture natural gas and hydrocarbons during flowback, reducing emissions of VOCs by an estimated 95 percent.
Additional EPA rules may be forthcoming in response to a petition filed last week by Earthjustice on behalf of over 100 non-profit groups. The petition asks EPA to issue regulations under TSCA requiring manufacturers and processors of “chemical substances and mixtures used in oil and gas exploration or production,” including fracking fluids, to conduct testing on the toxicity and environmental and health impacts of their products and disclose the results to EPA. If the petition is denied, Earthjustice has suggested it would challenge EPA’s determination in court.
Fracking regulation is also moving forward on the state and regional level, with the Delaware River Basin Commission (“DRBC”) – a regional body consisting of four states and the Army Corps of Engineers – proposing rules governing hydraulic fracturing siting and operations in New York, New Jersey, Pennsylvania, and Delaware. New York Attorney General Eric Schneiderman has filed suit in federal court seeking to enjoin the finalization of those rules pending the preparation of an Environmental Impact Statement under the National Environmental Policy Act (“NEPA”). On August 4, the Delaware Riverkeeper Network, Hudson Riverkeeper, and National Parks Conservation Association brought a similar suit in the same court. Unlike New York, however, the environmental groups named DRBC as a defendant.
The U.S. Department of Justice (“DOJ”), on behalf the Army Corps of Engineers and other federal defendants, recently announced its plans to move to dismiss New York’s lawsuit on sovereign immunity, standing and ripeness grounds. There are also questions as to whether the proposal of a regional body is a “major federal action” governed by NEPA – an argument that DOJ reserved the right to raise at a later date as an additional ground for dismissal. A pre-motion conference on DOJ’s request for dismiss is scheduled for Wednesday, August 10.
July 1, 2011
On July 1, the New York State Department of Environmental Conservation (“DEC”) issued a revised Draft Supplemental Generic Environmental Impact Statement (“SGEIS”) recommending that high-volume hydraulic fracturing (“fracking”) be banned in the New York City and Syracuse drinking water watersheds but that fracking be allowed to proceed, subject to strict regulation, on private property. Fracking uses high-pressured water, combined with chemicals, to release natural gas present underground in shale formations.
The revised Draft SGEIS contains recommendations to mitigate the environmental effects of fracking. These recommendations, which would make approximately 85 percent of the Marcellus Shale accessible to natural gas production, include the following:
- Fracking would be prohibited in the New York City and Syracuse watersheds, including a buffer zone;
- Drilling would be prohibited within primary aquifers and within 500 feet of their boundaries;
- Surface drilling would be prohibited on state-owned land, including parks, forest areas and wildlife management areas;
- Fracking will be permitted on privately held lands under “rigorous and effective controls”; and
- DEC will issue regulations to codify these recommendations.
DEC’s present recommendations depart from those contained in an earlier 2009 Draft SGEIS, which would have permitted drilling in the New York City and Syracuse drinking water watersheds, and which would have allowed surface drilling for high-volume fracking in primary aquifers and on public forests, wildlife areas, and parkland. In December 2010, then-Governor David Paterson ordered DEC to revise the initial Draft, taking into consideration the voluminous public comments that had been submitted. This order was understood to impose a de facto moratorium on new permits until the issuance of the revised draft.
The import of DEC’s present findings to stakeholders such as upstate residents, downstate residents, municipalities, and industry cannot be fully understood without a thorough review of the revised Draft SGEIS, which is over 900 pages long. As with many comprehensive studies, the devil will be in the details. The revised Draft SGEIS will be posted on DEC’s website on July 8, 2011, and will be open for public comment for 60 days beginning in August. It is expected that another round of extensive public comments will follow.
As of July 1, DEC has posted an Executive Summary of the revised Draft SGEIS and other related information online. This website should contain the entire revised Draft SGEIS by July 8.
Click here for more information about hydraulic fracturing in New York.
June 9, 2011
On May 31, 2011, New York Attorney General Eric Schneiderman followed through on his threat to file a lawsuit seeking environmental review under the National Environmental Policy Act (“NEPA”) prior to the issuance of final natural gas development regulations by the Delaware River Basin Commission (“DRBC”). The DRBC is a federal-interstate entity formed by compact and concurrent legislation by the federal government, Delaware, New Jersey, Pennsylvania, and New York to manage the water resources of the Delaware River Basin. The DRBC released draft natural gas development regulations on December 9, 2010 which, if finalized, would potentially open up large portions of the New York City watershed for natural gas drilling. While further action by New York State would likely be necessary for such natural gas drilling within New York, the complaint also alleges several harms to New York from natural gas development within Pennsylvania. In particular, the complaint alleges that development within Pennsylvania would contribute to air pollution in New York City and hinder efforts to meet air quality goals required under the Clean Air Act.
The lawsuit names the Army Corps of Engineers, which has a seat on the DRBC, as well as the Fish and Wildlife Service, the National Park Service, the U.S. Department of the Interior, and the Environmental Protection Agency as defendants. It asks these federal agencies to prepare an Environmental Impact Statement before the DRBC finalizes the regulations. It specifically asks the agencies to consider the alternative of prohibiting development within the portion of the Delaware River Basin that is within the New York City watershed.
The main legal issue in the lawsuit will likely be whether the regulations are a “federal action” within the meaning of NEPA. According to the complaint, the DRBC responded to Schneiderman’s initial request for an environment impact statement with a letter stating that the DRBC is not a federal agency subject to NEPA. However, the complaint alleges that the Army Corps of Engineers and the other federal agencies involved in the development of the DRBC regulations are subject to NEPA. The complaint also alleges that the Council on Environmental Quality (“CEQ”), which oversees implementation of NEPA, has determined that the DRBC is subject to NEPA.
Mark Lebel is a Summer Associate at Sive, Paget & Riesel
April 22, 2011
On April 18, 2011, New York Attorney General Eric Schneiderman threatened to sue the Delaware River Basin Commission (“DRBC”), if it did not, within 30 days, commit to conducting an environmental review of its draft natural gas development regulations pursuant to the National Environmental Policy Act (“NEPA”). The DRBC is a federal-interstate entity formed by compact and concurrent legislation by the federal government, Delaware, New Jersey, Pennsylvania, and New York to manage the water resources of the Delaware River Basin. According to Schneiderman’s press release, “[t]he Basin includes the New York City watershed and portions of Broome, Chenango, Delaware, Schoharie, Greene, Ulster, Orange and Sullivan Counties, and provides approximately 50 percent of the drinking water used by over nine million New York residents and visitors every day.”
The DRBC released its draft natural gas development regulations on December 9, 2010, over the objection of former New York Governor David Paterson. Paterson had cautioned that DRBC’s regulations “did not have the advantage of the full investigations and public deliberations taking place in New York, and could conflict with or complicate any protocols ultimately established by New York after it completed its pending review of the environmental impacts of high volume hydraulic fracturing.”
In his public statement, Schneiderman criticizes DRBC’s failure to comprehensively assess the environmental impacts of its proposed regulatory scheme – in particular, the consequences of allowing hydraulic fracturing within the Basin – before releasing them in draft form.
April 13, 2011
While the use of hydraulic fracturing to extract natural gas from shale has generated substantial concerns about its water quality and conventional air pollution impacts, such opposition has rarely focused on greenhouse gas (“GHG”) emissions. Instead, it has been widely assumed, including by some environmental organizations, that natural gas is the least harmful “bridge fuel” to reduce GHG emissions during a transition from coal to alternative energy sources. That core assumption was called into question this week following the release of a new study finding that total GHGs from natural gas extracted through hydraulic fracturing (“shale gas”) may match or exceed those from coal. The validity of these conclusions, however, is already the subject of intense debate.
The study, by three Cornell University researchers, reported that the primary GHG emissions from hydraulic fracturing are not carbon dioxide from the burning of natural gas, but methane released during the fracturing process, the operation of the wells, and the transportation and storage of the fuel. Because methane is a far more potent greenhouse gas than carbon dioxide, the study concluded that over a 20 year time frame “the GHG footprint for shale gas is at least 20% greater than and perhaps more than twice as great as that for coal.” Carbon dioxide remains in the atmosphere for longer than methane, but even over a 100-year period the study found that shale gas emissions were “comparable” to coal emissions. The study’s data and methodology have already been disputed by the oil and gas industry, principally because the assumed rate of fugitive emissions is at odds with industry standards and practices. The report’s authors acknowledge that better data is needed on the amount of methane emissions that leak or are otherwise lost during and after hydraulic fracturing operations, which is now likely to become a focus of increased attention.
Additional obstacles for fracturing proponents surfaced during a Senate Environment and Public Works Committee hearing yesterday, as an Environmental Protection Agency (“EPA”) official affirmed that drilling companies that use diesel fuel in hydraulic fracturing operations without a permit are in violation of Safe Drinking Water Act. A 2010 report revealed inconsistent positions among state environmental regulators concerning the use of diesel as a fracturing fluid, and last year EPA posted a statement on its website that: “Any service company that performs hydraulic fracturing using diesel fuel must receive prior authorization …” The Independent Petroleum Association of America and U.S. Oil & Gas Association are challenging that posting in the D.C. Circuit Court of Appeals, alleging that EPA imposed new substantive requirements without undertaking the rulemaking procedures required by the Administrative Procedures Act (“APA”).
In New York, a bill that would have required the disclosure of hydraulic fracturing chemicals was rejected in the Senate Environmental Conservation Committee yesterday. The legislation, S. 425, drew support from a majority of Committee members voting, but fell one vote short of the eight required to bring it to the Senate floor. Fracturing disclosure legislation is also pending in the United States Congress. While such disclosure is not currently required nationwide, a new website from the Ground Water Protection Council and the Interstate Oil and Gas Compact Commission, funded in part by the Department of Energy, has collected chemical data voluntarily submitted by participating oil and gas companies and published it in a searchable database.
March 10, 2011
On February 23, 2011 a bill[1] was introduced in the New York State Assembly that would impose a moratorium on new permits for the drilling of wells using hydraulic fracturing and horizontal drilling until the Environmental Protection Agency (“EPA”) has issued the results of its pending study of the effects of hydraulic fracturing on drinking water and public health. EPA expects to obtain preliminary results of its study by the end of 2012, and aims to produce a report in 2014. Thus, the proposed law could significantly delay in the issuance of new permits for hydraulic fracturing in New York. At present, an executive order issued by former Governor Paterson and continued by Governor Andrew Cuomo prevents the issuance of new permits for horizontal hydraulic fracturing until the completion of the Final Supplemental Generic Environmental Impact Statement (“SGEIS”) concerning this process. The Assembly bill was sponsored by Steve Englebright (D), who represents Assembly District 4 in Suffolk County and is a geologist by training.
On March 4, 2011, a separate bill[2] was introduced in the New York State Senate that proposes modifications to the General Obligations Law. These modifications would encourage the disclosure of the chemicals used during hydraulic fracturing. The bill bars any contract relating to or referring to hydraulic fracturing from prohibiting disclosure of the chemicals used during that process, and bars the diminishment of pay to a hydraulic fracturing contractor based on a provision in the contract calling for the disclosure of such chemicals. The Senate bill was sponsored by John Bonacic (R) of the 42nd Senate District, which encompasses Delaware, Sullivan, Orange, and Ulster Counties, as well as the Catskill watershed system supplying New York City’s drinking water.
The two bills reflect different approaches to the ongoing concern among New Yorkers that hydraulic fracturing could have unintended consequences on drinking water and public health. A recent article in the New York Times has raised such concerns in depth, based on previously unreleased reports by EPA and industry. According to the Times, these reports indicate that naturally occurring radioactive materials in waste released from hydraulic fracturing wells are not adequately removed by sewage treatment plants or dilution before or during discharge into rivers that provide drinking water. The Times article focuses on hydraulic fracturing activity in Pennsylvania, where the use of this process has been much more extensive than in New York. However, the article highlights an important issue that might be revisited as DEC works on the SGEIS; the initial draft SGEIS concludes that naturally occurring radioactive materials resulting from hydraulic fracturing pose very little health risk.
[1] The text of the bill, A05547, is available by search at the N.Y. State Assembly’s website.
[2] The text of the bill, S03765, is available by search at the N.Y. State Assembly’s website
February 15, 2011
On February 8, 2011, the U.S. Environmental Protection Agency (“EPA”) submitted its draft plan for its study on hydraulic fracturing to the EPA’s Science Advisory Board (“SAB”) for review. As discussed previously on this blog, the study will focus on the effects of hydraulic fracturing on drinking water. In March 2010, EPA commenced preliminary work for the study, which has included convening public meetings and seeking information from gas companies – using both voluntary requests and subpoenas – about the specific chemicals used in the hydraulic fracturing process. According to the draft study plan, EPA intends to focus on the following research questions:
- How might large volume withdrawals from ground and surface water, to be used for hydraulic fracturing, impact drinking water resources?
- What are the possible impacts of releases of hydraulic fracturing fluids on drinking water resources?
- What are the possible impacts of the injection and fracking process on drinking water resources?
- What are the possible impacts of releases of flowback and produced water on drinking water resources?[1]
- What are the possible impacts of inadequate treatment of hydraulic fracturing wastewaters on drinking water resources?
The draft plan will be reviewed by the SAB in a public meeting in Alexandria, VA on March 7-8 2011. Public comments will be heard during the meeting.
In New York, it has been reported by the Binghamton Press & Sun-Bulletin that Joseph Martens, Acting Commissioner of the New York State Department of Environmental Protection (“DEC”), indicated in a session before the state legislative budget committee on February 8 that DEC would not necessarily wait for the completion of EPA’s study before beginning to process applications to drill natural gas wells using hydraulic fracturing. Rather, review of applications would be triggered by the agency’s completion of its own study of hydraulic fracturing, to be set forth in a Supplemental Generic Environmental Impact Statement (“SGEIS”). As discussed previously on this blog, it is expected that a Revised Draft SGEIS will be released on June 1, 2011, and that the Final SGEIS will be released in the fall of 2011. However, Martens noted that DEC’s actual ability to process gas companies’ applications could be limited or delayed by staffing constraints if the number of applications is overwhelming.
Also on February 8, the Common Council of Buffalo, NY voted unanimously to ban any form of natural gas extraction, including hydraulic fracturing, within its borders. The measure is seen as symbolic, as no such drilling projects have been planned in Buffalo. Buffalo follows Pittsburgh, PA, which imposed a ban on natural gas drilling within city limits in November 2010. Other municipalities, such as Philadelphia and New York City, while not imposing drilling bans, have also called for limits on hydraulic fracturing.
[1] Flowback water is the water that has been injected into the well after it has served its purpose of fracturing the underground rock formation; this water flows back up the well and to the surface. Produced water is water originating underground that is released to the surface through the well.
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