Monday, August 22, 2011
Rigzone Staff
by Barbara Saunders
The federal government should not tell states how to regulate natural gas operations within their borders, the American Petroleum Institute (API) told a U.S. Department of Energy (DOE) panel in formal remarks on the panel's preliminary findings.
"While the industry and states are constantly striving to improve operations, it is important to recognize the strong foundation for shale gas operations that currently exists through robust state regulatory programs in most parts of the country," API said. "Rather than deferring on the proper role of state governments, we recommend the Subcommittee acknowledge the success that has been demonstrated through state-level programs. Regulation of oil and natural gas has been led by states since the inception of the industry and has demonstrated a high degree of capability and flexibility in adapting to changes such as those seen with unconventional gas development. States have created systems that effectively protected the environment, including ground water and drinking water sources."
Other remarks by the industry group included:
- "API supports a strong state regulatory framework for natural gas and the dedication of appropriate resources and staff to carry out the regulatory functions. The Subcommittee should defer to the states on the question of how to generate the necessary funding for regulatory programs, rather than making this determination for the states.
- "..[W]e are concerned that the Subcommittee did not engage in a gap analysis to determine whether, and to what extent, the items included in its recommendations have been or are being addressed by state and federal regulators, academia, industry or third parties. . . . A benefit-cost analysis is critical to balanced decisions related to the regulation of commercial activity.
- "API agrees that the protection of water resources is a top priority for all industry operations including hydraulic fracturing. However, water is a highly regulated commodity subject to the federal Clean Water Act as administered by the federal government and the states. A systems approach is already occurring in most local, state, and interstate jurisdictions due to the many requirements associated with water allocation and management processes. In addition, in most states, there already exists a reasonable manifest system for tracking wastes to their point of disposal. We see little additional value from requiring a manifest for the transportation of fresh water hauls since most water management agencies require reporting of these volumes already. This type of requirement should be reserved for those elements posing the greatest risks."
Among other things, API also protested the DOE panel's proposal to regulate air quality emissions from fracking operations separately. "Shale gas operations are already subject to a myriad of federal (Clean Air Act) and state air emissions regulations that have been in place for many years and continue to evolve," API said. "States must often obtain primacy by having programs as or more stringent than the federal requirements in meeting human health and environmental goals."
API supported the panel's recognition that shale gas provides important energy and economic contributions to the U.S.
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