Bloomberg News

Wyoming’s Tainted Water Pressures EPA on to Act on Gas Fracking

December 13, 2011

Dec. 12 (Bloomberg) -- A U.S. Environmental Protection Agency report linking hydraulic fracturing for natural gas to groundwater contamination for the first time puts pressure on the agency to move sooner on efforts to regulate drilling.

The Dec. 8 report that chemicals consistent with those used in drilling were found in groundwater samples in west-central Wyoming may be used by the agency to accelerate action, according to Ken von Schaumburg, a Washington-based attorney and former EPA deputy general counsel. The EPA is weighing three rules on fracturing, or fracking, the first of which is planned for April.

Environmental groups say fracking, in which millions of gallons of chemically treated water are forced underground to shatter rock and let gas flow, is a threat to drinking-water supplies. The EPA’s draft report on groundwater contamination in Pavillion, Wyoming, about 230 miles (370 kilometers) northeast of Salt Lake City, is the first to blame the drilling technique for spoiling water.

“They’re trying to move the rule-making along,” von Schaumburg, who served in President George W. Bush’s administration, said in an interview. “They’re getting a lot of pushback from industry. This may be a tool for EPA to speed up the process.”

The EPA’s three-year study followed complaints from residents about the smell and taste of their water. Samples taken from an aquifer through deep monitoring wells revealed “compounds likely associated with gas-production practices, including hydraulic fracturing,” according to the draft report.

Encana’s Response

Encana Corp., which owns 123 wells in Pavillion, said the report dealt with probabilities, “not a definitive conclusion,” according to Doug Hock, a spokesman for the Calgary-based company, Canada’s largest natural-gas producer.

He said synthetic chemicals such as glycols and alcohols that turned up in the testing are just as likely “the result of contamination from their own sampling.”

Conditions at Pavillion differ from “many other areas of the country,” according to the EPA report. The Wyoming drilling, which began in the 1950s, was shallower and closer to an aquifer than is common in areas such as the Marcellus Shale in northeastern states such as Pennsylvania.

U.S. Senator James Inhofe, a Republican from Oklahoma, said in a statement that the Pavillion findings were based on “political science” and reflect President Barack Obama’s “determination to shut down natural-gas production.”

‘Politicized Role’

Daniel Kish, senior vice president for policy at the pro- fracking Institute for Energy Research in Washington, said the EPA under Administrator Lisa Jackson “has played an increasingly politicized role in regulatory enforcement.”

Fracking permits are issued by states, the primary regulators of oil and gas operations. Industry groups have said regulation should remain in the hands of state officials who are closest to local concerns and know the most about differences in geology that affect drilling.

“We don’t think that there’s the need for federal oversight,” Stephanie Meadows, upstream senior policy adviser for the Washington-based American Petroleum Institute, said in an interview. “We would argue that the states are doing exactly what they should do.”

The EPA has begun weighing federal rules for certain elements of the drilling process.

“The industry is going to say this study proves nothing,” Tyson Slocum, energy program director for Public Citizen, a Washington-based consumer advocacy group, said in an interview. “But everybody is talking about a vastly expanded role for natural gas in the U.S. economy, and there’s way too much uncertainty into how fracking is going to be regulated.”

Three Initiatives

Fracking accounts for about a third of the U.S. gas supply, up from 14 percent in 2009, according to the U.S. Energy Department.

The EPA is conducting an extensive study of fracking and its effect on drinking water, with plans to release an interim report next year and a final study in 2014. The EPA will do its own testing and review scientific studies to try to determine whether drinking water is affected by fracking, and, if so, what is causing it.

The first of three rules being weighed by the agency is scheduled to be issued in April. It will cover air emissions from new oil and gas wells of all types, requiring monitoring and performance testing. The EPA said those standards are intended to capture 95 percent of the smog-causing gases that now escape in fracking operations.

Second, the EPA is working on standards for water discharges from drilling that are scheduled to be issued in 2014.

Halliburton, Schlumberger

Third, companies such as Halliburton Co. and Schlumberger Ltd., which supply oil and natural-gas producers, may face new requirements to disclose substances used in fracking after the EPA said Nov. 23 that it accepted a petition filed by environmental group Earthjustice. No deadline has been set for a decision.

The EPA will try to provide “aggregate pictures of the chemical substances and mixtures used in hydraulic fracturing,” Stephen A. Owens, an assistant administrator at the agency, said in a letter posted on the agency’s website. “This would not duplicate, but instead complement, the well-by-well disclosure programs of states.”

Mark Brownstein, chief counsel for energy programs at the Environmental Defense Fund in New York, said in an interview that “the draft report on Pavillion is going to put more pressure, certainly, on EPA to move quicker.”

--Editors: Larry Liebert, Timothy Franklin

To contact the reporters on this story: Jim Efstathiou Jr. in New York at jefstathiou@bloomberg.net; Mark Drajem in Washington at mdrajem@bloomberg.net

To contact the editor responsible for this story: Larry Liebert at lliebert@bloomberg.net


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