17 August 2015

Sidley Shale and Hydraulic Fracturing Report

Vol. 4, No. 33

Topics discussed in this week’s Report include:

  • North Dakota: Health Department Approves Plan for Disposal of Low-Level Radioactive Waste.
  • Pennsylvania: DEP Issues Final Draft Regulations for Oil and Gas Wells.
  • Ohio: Hydraulic Fracturing Ban Initiatives Removed from November Ballot.
  • United Kingdom: Proposed Rules Would Give National Government Control over Hydraulic Fracturing Permits.
  • Report Evaluates Potential Impact of Hydraulic Fracturing in Delaware River Basin.

States

North Dakota: Health Department Approves Plan for Disposal of Low-Level Radioactive Waste. The North Dakota Health Council, comprised of members of the medical and business communities, recently approved a plan to allow oil producers to dispose of low-level radioactive waste. If approved, the plan would allow material that emits up to 50 picoCuries to be disposed of in local landfills. Proponents argue that the plan will encourage lawful disposal of radioactive waste associated with oil and gas development. The Health Council’s rules must be approved by the attorney general and Administrative Rules Committee before receiving final approval. The process could be completed by January 1, 2016.

Pennsylvania: DEP Issues Final Draft Regulations for Oil and Gas Wells. On August 12, 2015, the Pennsylvania Department of Environmental Protection (DEP) released final draft regulations for conventional and unconventional oil and gas wells. The final draft regulations would revise DEP’s existing regulations for oil and gas development and establish more stringent provisions that would further protect water resources. The final draft removed proposed noise control provisions, leaving that issue to be addressed in a separate rulemaking. The rules do draw distinctions between conventional and unconventional oil and gas development, including, for example, prohibiting the use of pits for fluid storage for unconventional wells. Public hearings on the final draft will be held in the coming weeks. By law, DEP must submit final regulations to the state’s Independent Regulatory Review Commission by March 2016, or it will have to begin a new rulemaking process. Critics of the regulations argue that the DEP added significant new provisions in the final draft that were not subject to required review by the legislature, the Independent Regulatory Review Commission and the public.

Ohio: Hydraulic Fracturing Ban Initiatives Removed from November Ballot. On August 13, 2015, Ohio’s Secretary of State removed three proposals to ban hydraulic fracturing from the November ballot. The ballot initiatives in Medina, Fulton and Athens counties would have banned hydraulic fracturing as a violation of community rights. The Secretary of State stated that the legality of such bans had already been litigated in State v. Beck Energy Corp., in which the Ohio Supreme Court held that local bans conflicted with state laws regulating oil and gas operations. As a result, the Secretary of State found that allowing the ballot proposals to go forward would waste taxpayer resources.

International

United Kingdom: Proposed Rules Would Give National Government Control over Hydraulic Fracturing Permits. The UK government recently announced a proposal to allow the UK Department of Communities and Local Government to take over the review and approval of shale drilling applications. The rule would allow such takeovers to occur if local governments failed to act on permit applications within 16 weeks. Estimates suggest that the UK has as much as 1.3 quadrillion cubic feet of natural gas deposits, and the national government has indicated strong support for shale gas development. Local governments, facing drilling opponents that have organized against development in their communities, have expressed more concern and, in some cases, have denied permit applications for shale gas development.

Studies

Report Evaluates Potential Impact of Hydraulic Fracturing in Delaware River Basin. A recent report prepared by the Center for Naval Analyses (CNA) concluded that as many as 4,000 wells could be developed in the Delaware River Basin if the Delaware River Basin Commission (DRBC) lifted its five-year moratorium on the use of hydraulic fracturing to develop natural gas resources within the Basin. The DRBC is an Interstate Compact that regulates certain water use activities in the Basin, an area which includes portions of Delaware, New Jersey, New York and Pennsylvania. The CNA report was funded by the Delaware Riverkeeper Network, an organization opposed to any development in the basin. The report concluded that 45,000 people live within one mile of potential well sites, and listed potential environmental and human health concerns with any development. Supporters of hydraulic fracturing criticized the report, highlighting the strict hydraulic fracturing regulations already in place in the Basin as well as inconsistencies between CNA’s assumptions and current hydraulic fracturing practices.

If you have any questions regarding this Report, please contact us.

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