12 January 2015

Sidley Shale Gas and Hydraulic Fracturing Report

Vol. 4. No. 2

Federal

Environmental Groups Sue DOI for Documents Related to the Use of Hydraulic Fracturing in the Gulf of Mexico. On January 8, the Center for Biological Diversity filed a lawsuit against the U.S. Department of the Interior’s Bureau of Ocean Energy Management and Bureau of Safety and Environmental Enforcement in the U.S. District Court for the District of Columbia. The lawsuit alleges that DOI failed to comply with its obligations under the Freedom of Information Act to produce reports, permits and other documents relating to Interior’s allowance of the use of hydraulic fracturing and other unconventional development techniques in offshore oil and gas operations in the Gulf of Mexico.

Environmental Groups file suit against U.S. EPA Seeking to Compel EPA to act on NGO Petition to Extend Reporting Requirements to Oil and Gas Sector. A group of environmental NGOs filed suit this past week against the United States Environmental Protection Agency (EPA) seeking an order compelling EPA to act on their petition urging EPA to add the oil and gas industry to the industry sectors that must report toxic chemical releases under the federal Emergency Planning and Community Right-to-Know Act Toxics Release Inventory. The petition cites to prior EPA statements regarding releases from the oil and gas industry and the increase in releases from expanded oil and gas operations with the advent of hydraulic fracturing. The original petition was filed in October 2012 and EPA has not yet made a decision whether the petition should be granted. The plaintiffs seek an order compelling EPA to issue a decision on the petition within 60 days.

DOI Secretary Responds to Growing Number of Local Fracking Bans. Interior Secretary Sally Jewell voiced concern that that state and local efforts to ban hydraulic fracturing are often based on inaccurate information about drilling operations and cause uncertainty for industry groups and drilling operators faced with county and city specific rules. Speaking in response to a number of new bans, including those recently adopted in New York, Pennsylvania, Texas and Colorado, Secretary Jewell said that industry should use more scientific explanations to inform local communities about fracking practices and associated risks.

States

Texas Town Delays Decision on Drilling Ordinance. The Denton, TX City Council voted to continue a moratorium until late March and delay voting on new gas drilling rules that would supplement a ban on hydraulic fracturing passed by voters in November 2014. The Texas Oil and Gas Association and state sued Denton following passage of the voter-approved ban, however the city-enacted moratorium and proposed rules have been progressing separately. The proposed ordinance, which would remain in effect even if the ban is successfully overturned through litigation, will allow companies to drill new wells on existing leases as long as they take steps to protect the surrounding land, including consolidating well locations and complying with setback provisions.

Virginia Weighs New Draft Regulations on Chemical Disclosure and Fracking Operations. A new, draft regulation under consideration by the Virginia Department of Mines, Minerals and Energy (DMME) will require companies that use hydraulic fracturing within the state to disclose all of the chemicals used during drilling both to DMME and the FracFocus website, including those claimed as trade secrets. Sixteen states currently require operators to disclose the chemicals in hydraulic fracturing fluids to FracFocus; Virginia’s current regulations requires only a general description of the fluid. The draft regulations also contain provisions requiring pre-drilling groundwater testing, pressure-testing and local government participation in pre-application discussions with DMME and drilling companies. Once the draft is finalized, there will be an opportunity for public review and comment.

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