Environmentalists Support Fracking But With Important Reservations

It is necessary that natural gas be substituted for coal and oil as an energy source if the world is to have any chance of avoiding runaway greenhouse gas (“GHG”) emissions, particularly from the developing world.

At present, it is unrealistic to expect renewable energy sources (solar, wind and geothermal) to serve as a foundation for national energy policy. In the United States, even with the best use of conservation, energy efficiency and renewables, the combination of these various “alternatives” will not become a substitute for fossil fuels for a very long time.

In a thoughtful article in the New York Law Journal on January 2, 2014, titled  “Countries Approach Fracking With Interest and Caution,” Stephen L. Kass, makes the case that natural gas from hydraulic fracturing should be an important component of a comprehensive energy strategy, both in the United States and abroad.  According to Kass, fracking is attractive to: (1) economists seeking to stimulate development; (2) national security officials seeking independence from unreliable oil suppliers; and (3) environmentalists who seek to avoid runaway GHG emissions, particularly from developing countries.

In the United States, fracking now accounts for a staggering 25% of domestic natural gas (a figure expected to rise to 50% by 2035). In addition to lowering energy costs, according to Kass, fracking is widely credited with reducing U.S. “carbon intensity” and GHG emissions.

Fracking places the environmental community between the proverbial rock and a hard place. On the one hand, environmentalists recognize that fracking offers enormous environmental benefits in terms of reduced GHGs. On the other hand, environmentalists continue to be concerned that fracking fluids may contaminate precious water sheds.

Therefore, it is the goal of the environmental community that the amount of water used in fracking be minimized through recycling, that double-walled drill shafts and other controls be effectively utilized to minimize fugitive methane releases, and that waste fluids be adequately treated on-site before being recycled, discharged to water treatment plants or re-injected. The oil and gas industry’s refusal to disclose the composition of its fracking fluids has become an unnecessary distraction from these key environmental concerns.

In the long run, environmental concerns are likely to be largely addressed by increased and more effective regulation and by self-policing by industry. From the standpoint of providing an inexpensive fuel to tens of millions of American homeowners, the stakes are simply too high for environmentalists, who support fracking with these reservations, to concede defeat. As industry continues to demonstrate that fracking can be performed in a safe and environmentally sound manner, opposition to the practice will most likely diminish.

NYS Hydrofracking Moratorium: No End In Sight

The NYLCV’s eco politics daily reported this morning that Governor Andrew Cuomo will not reach a decision on whether to allow fracking in New York until the NYS Department of Health releases its long-awaited study concerning fracking’s health effects.

On Monday, Gov. Cuomo spoke with Susan Arbetter of NCYN’s Program, "The Capitol Pressroom".  He acknowledged that while fracking could have economic benefits for upstate New York, the accompanying health and environmental impacts were not insignificant and he was not prepared to condemn or condone the practice before knowing the full consequences of such action.

At the same time, the DEC is in the process of collecting information on a comprehensive exploration of environmental impacts for which fracking opponents and supporters have been anxiously.  The five year moratorium on hydrofracking in New York is a hot button issue in New York’s gas-rich Southern Tier, where the economy could use the boost that natural gas exploration could provide. 

According to Debbie Preston, Broome County Executive, "We won’t be silenced and we won’t stop fighting for our future until we are start drilling here in New York state”.  In an article by Elyse Michalonis, dated July 23, 2013, appearing in YNN, state legislators in the area compare the boom economy in neighboring Pennsylvannia with the absence of growth in New York.   "If you go down to Pennsylvania, travel around, it’s a booming economy, things are happening. There’s new roads and buildings. They’re thriving. We’ve got people in this area driving there, because that’s the only place to get a job,” said Assemblyman Clifford Crouch.


Zoning Ban On Fracking: OK in NY, But Maybe Not OK In PA

Local bans on hydraulic fracturing continue to be fiercely debated as the use of hydraulic fracturing for oil and gas development of shale reserves increasingly gains in popularity. Grassroots opponents of  hydraulic fracturing increasingly stress the non-environmental social impacts that have become associated with hydraulic fracturing in certain rural communities. 

On May 2, 2013, two Appellate Division cases in New York came down that upheld the use of local zoning ordinances to ban fracking. Unless the New York Court of Appeals takes a different path, the law established in these cases – Norse Energy Corp. v. Town of Dryden, No. 515227, 2013 N.Y. Slip OP. 03145 (3d Dept. 5/2/13)and Cooperstown Holstein Corp. v. Town of Middlefield, No. 515498, 2013 Slip Op. 03148 ((3d Dept. 5/2/13), will allow towns to use zoning to ban fracking in their communities.

An excellent discussion of the background of these New York cases can be found in WestLaw Journal: Environmental (Volume 33, Issue 26/July 9, 2013) titled "Will fracking become the rule of local zoning control in New York state?", authored by  Eileen Millett, an environmental lawyer at Epstein Becker & Green and a former a former Visiting Professor of Law, who taught courses at Syracuse University School of Law in environmental and regulatory law, and  is an expert on environmental/energy regulatory compliance.

According to Millett, the law may now be settled on this issue in New York, but the same issue is creating angst for stakeholders in Pennsylvania. Pennsylvania Act 13, enacted in 2012, contained a section restricting the ability of municipalities from controlling the location of gas drilling within their boundaries.

Pennsylvanians now await a decision from the Supreme Court, in the wake of a Commonwealth Court decision, which  found that that Act 13 cannot restrict zoning. The state had argued in that case that zoning provisions in Act 13 do not pre-empt local governments from enacting zoning ordinances so long as they did not place any restrictions on the location of oil and gas drilling operations in conflict with Act 13. Robinson Township et al. v. Commonwealth of Pennsylvania, No. 284 MD 2012.

Citing the need for statewide uniformity to ensure the most efficient development of oil and gas resources, and consistent environmental protections for all residents, the Pennsylvania legislature also declared that all local ordinances — including local zoning rules — must allow for reasonable development of oil and gas resources consistent with the new legislation. Stay tuned. 

Once the moratorium on hydraulic fracturing is lifted in New York (and it most likely will be lifted sooner or later), there may be a patchwork of communities throughout the State which have banned fracking.  Nevertheless, there will still be many communities in New York where the activity will be welcomed.

Among Environmentalists, Hydrofracking Is Not A “Yes Or No” Issue

On April 10, 2013, I participated in “Justice Speaks,” an event sponsored by the Justice Action Center at New York Law School on hydraulic fracturing.

 Joining me on the podium was Daniel Raichel, a Project Attorney with the Natural Resources Defense Council (“NRDC”), and the lead attorney with the newly formed Community Fracking Defense Project. Pursuant to this initiative, NRDC provides legal assistance to towns and local governments in potential shale drilling zones upstate that seek to prohibit hydrofracking in their communities.

 My presentation concerning hydrofracking centered broadly around the following points:

1.  The technology under discussion, by which oil and gas is extracted from shale deposits, is a game-changer. Due to technological advances, the use of horizontal drilling and hydrofracking has had a transformative effect on oil and gas exploration;

2.  The discussion over hydrofracking is not merely an environmental debate. What is at stake has important economic and social implications, not just for the United States, but for the entire world. The extent to which this technology can make the United States energy independent has significant national security and foreign policy ramifications.

 3.  Among mainstream environmentalists, hydrofracking is no longer a “Yes/No” question. Both industry and the environmental community recognize a need for more comprehensive regulation and environmental oversight. This recognition has resulted in significant joint efforts to develop standards and best practices.

The players on both sides of the debate have come together to find common ground. For example, a partnership has emerged between energy firms involved in hydraulic fracturing, including Chevron and Royal Dutch Shell, and environmental groups that are often opposed to fossil fuel development, including the the Environmental Defense Fund, the Clean Air Task Force, and the Group Against Smog and Pollution.

These entities jointly established the Center for Sustainable Shale Development (“CSSD”), which will provide independent and voluntary evaluations and certifications of shale gas developers. CSSD will establish standards to limit flaring, maximize water recycling, and reduce the toxicity of injection fluids, among other initiatives.

There is recognition by both the environmental community and industry that industry made a number of missteps early on and did not do as good a job as it could have in bringing this new technology online. Part of the problem was that regulators in many states were overwhelmed by the increased industrial activity and did not have the manpower or the necessary regulations on the books to properly oversee the activity that was occurring. Another problem was that the horizontal drilling technology was developing so rapidly. However, as public scrutiny on horizontal drilling has increased and as the industry has become more mature with the passage of time, the likelihood of serious environmental problems occurring due to hydrofracking has significantly diminished.

Mr. Raichel argued convincingly that there remain many gaps in regulatory oversight of hydraulic fracturing, particularly in existing statutory schemes such as the Clean Water Act and the Clean Air Act. However, New York’s deliberate and painstaking approach to understanding the potential impacts of hydrofracking on human health and the environment will  hopefully result in a well-regulated program once permits are issued and gas exploration finally gets off the ground.

Hydrofracking And The Battle Over Water In South Texas

In an article titled, “Introduction to Hydraulic Fracturing Natural Gas Exploration,” Rebecca Jo Reser, an IADC member and partner at the San Antonio, Texas law firm of Davidson Troilo Ream & Garza, discusses the potential burden that hydraulic fracturing imposes on water resources in South Texas.  In areas of South Texas stricken by drought, the issue of water allocation balances signficant strides in economic development and employment attributable to energy exploration and the interests of growers and others who fear that fracking activity may draw down too large a share of scarce water resources.

According to Reser, hydrofracking drilling and production companies compete for scarce water supplies in areas of South Texas,particularly in the Eagle Ford Shale, where drought has resulted in widespread pasture losses, crop failures and shortages of water in reservoirs, rivers and wells.   Based upon the tone of the article, it would appear that the battle lines are being drawn in Texas along the fault lines of this issue.

 Reser writes, "In an area known for drought and scarcity of water, the fact that this much valuable water will be pumped out, used and then disposed of forever in deep injection wells is something every South Texas resident should be concerned about."

But Chesapeake Energy, an energy company involved in deep shale development in the Eagle Ford Shale, strongly disputes that industry is using too much of the area’s water supply. According to a Chesapeake Energy Fact Sheet, the volume of water necessary to drill and fracture Eagle Ford deep shale wells represents a very small percentage of the total water resources used in the Eagle Ford Shale.

Citing Texas Water Development Board statistics, Chesapeake Energy states that the primary water users in Eagle Ford Shale are irrigation (approximately 70%) and municipal/public water supply (approximately 26%). Moreover, the company observes that its operations differ notably from other uses because it is temporary, occurring only once during the drilling and completion phase of each well. Unlike agricultural uses, use of this water does not represent a long term commitment of the resource.  According to a San Antonio Express-News article, last year, the Eagle Ford contributed $25 billion in total economic output in a 20-county South Texas region and provided 47,097 full-time jobs, according to statistics provided by UTSA. Thus, the econoimic benefits of drilling in Eagle Ford Shale are both measurable and significant.

Closer to home, in and around the Marcellus Shale region, the impact of water withdrawals for hydraulic fracturing on the Upper Delaware River and in the Delaware River Basin is the subject of ongoing investigation; however, the discussion has largely focused on environmental issues rather than on competition over scarce  resources.

State Fracking Disclosure Requirements

Opponents of fracking argue that it is necessary for the public, and health and safety professionals, to have full access to information on the constituents of hydraulic fracturing fluids and waste. In a report released on July 26, 2012 titled, “State Hydraulic Fracturing Disclosure Rules and Enforcement: A Comparison,” the Natural Resources Defense Counsel (“NRDC”) argues that no state can boast a comprehensive chemical disclosure requirement for oil and natural gas producers using hydraulic fracturing. In an article, dated July 31, 2012, Bloomberg BNA Toxics Law Reporter reported on NRDC’s assertion that “each of the state rules we analyzed has significant gaps in its requirements.”

In particular, the NRDC report zeroes in on trade secret exemptions, which it claims creates loopholes in most state disclosure rules. According to the report, not only may the companies decide what information is considered proprietary and should not be but, in many cases, the states have not consistently enforced the disclosure requirements on the books.

The oil and gas industry argues that state chemical disclosure rules provide strong evidence that state regulation is adequate and that new federal standards for disclosure are unnecessary.

NRDC’s report provides a helpful state-by-state analysis of trade secret exemptions to disclosure requirements and under what circumstances disclosure can be restricted.  For example, NRDC reports that six states provide for access to trade secret information by health care providers. These states are: Arkansas, Colorado, Montana, Ohio, Pennsylvania and Texas. Four of the states (all but Ohio and Arkansas) require that health care providers sign a confidentiality agreement before gaining access to the information, except in emergency situations. Health care professionals and health law experts have questioned whether such provisions violate doctors’ ethical obligations.

Meanwhile, participants of FracFocus, a joint project of the Ground Water Protection Council and the Interstate Oil and Gas Compact Commission, provide voluntary public disclosure of the fracking chemicals they use. Broad industry commitment to FracFocus suggests that NRDC’s concerns concerning inadequate disclosure are being addressed by the industry.

Whatever purported loopholes exist in state statutes, it is likely that toxic tort plaintiffs will be able to obtain full disclosure of chemicals used in fracking through the courts, assuming that they execute Confidentiality Agreements. 

Hydraulic Fracturing Risks and Opportunities

On April 18, 2012, Winston & Strawn and the Environmental Law Institute co-hosted an informative seminar on, “Hydraulic Fracturing Risks and Opportunities: Regulator, NGO, Industry and Investor Perspectives,” in New York City. The meeting was expertly chaired by May Wall, a partner in the law firm’s Environmental Law Department in Washington, D.C. The panelists included Kate Sinding, an NRDC Senior Attorney and Deputy Director of NRDC’s New York Urban Program; John Imse, a principal at Environ in Denver, who advises clients in the oil and gas industry; Lawrence A. Wilkinson, an analyst with Standard & Poor’s Oil & Gas Team; and Carol P. Collier, the Executive Director of the Delaware River Basin Commission. All four speakers were knowledgeable, informative and articulate. Unfortunately, there is insufficient space here to summarize all of the speakers’ discussion points.

John Imse emphasized how horizontal drilling evolved from the development of  “game-changing technology,” which has spurred significant changes in the gas exploration industry. As a result of new technology, there may be multiple horizontal wells drilled and developed from a single pad location – four to eight wells from a single drilling pad is not uncommon. Each well may have from as few as four to as many as twenty fracturing intervals. According to Imse, “these are not your wildcat wells of the early twentieth century,” but represent highly sophisticated technology.

Imse also discussed the evolving environmental consciousness of the gas exploration industry. He emphasized that “protective steel casing” and “a good cement job” is critical to a well’s success. Contrasting prior poor practices with current practices, Imse described the construction of drilling pads as “highly engineered sites” with liners and berms for spill control, and structural panels on working surfaces to protect the integrity of the liner. He emphasized the evolving consciousness concerning materials management, including the handling of chemicals in large volume containers; spill containment and secondary containment; and on-site 24/7 spill response.

To date, thirteen states have enacted statues requiring disclosure of fracking chemicals used by industry. These thirteen states account for 90% of current gas drilling, according to Imse. In response to pressure by the public and environmentalists, the additives used in fracking have evolved to “more green and more benign components.” For example, Halliburton is increasingly using guar-based gels and food grade mineral oil carriers, and less diesel for fracking.

There are a number of new web-based resources available to the industry. For example, the University of Colorado Natural Resources Law Center has assembled a compilation of Best Management Practices, which Imse strongly recommends as a reference.

Carol R. Collier, the Executive Director of the Delaware River Basin Commission, discussed the importance of the Delaware River Basin to New York City, which extracts 8.7 billion gallons of water per day. Collier’s “bosses” are the governors of the four states that comprise the Delaware River Basin – Pennsylvania, New Jersey, New York and Delaware. Significant portions of Marcellus Shale underlie portions of the Delaware River Basin. Water withdrawal from the Delaware River Basin is a significant concern. In addition to the 100,000-500,000 gallons of water extracted during the drilling of the well, another 5,000,000 gallons of water is withdrawn during the production life of each well.

Kate Sinding, a Senior Attorney with NRDC, discussed the highly charged political backdrop to the fracking controversy. According to Sinding, experiences in Pennsylvania over the past three to four years have given rise to much of the current environmental debate. Fracking has challenged the long held assumption that natural gas is a more environmentally benign fuel than coal, an assumption that is now coming under fire. Sinding expressed concern about environmental issues that she believed were “not amenable to best practices.” 


DEC Staff Buildup Required for Hydrofracking Permitting

DEC Commissioner Joe Martens told a panel of state lawmakers on February 7, 2012,  that it was “conceivable” that a handful of hydraulic fracturing permits could be issued in 2012 but that a final decision is “months, not years away.”  Martens cautioned that the number of permits that could be issued in 2012 would be “extremely limited” in part due to the “considerable work that remains before we finalize our regulatory framework.”


An additional hurdle to overcome before hydraulic fracturing can commence in earnest is the need to build up DEC’s regulatory staff to sufficiently oversee the proposed activity.  According to the Ithaca Journal, Commissioner Martens stated that DEC currently employs 16 gas drilling regulators, but estimates that the Agency would need 140 additional regulatory staffers during the first year that permits are issued.  According to the Public Employees Federation (“PEF”), DEC has lost more than 800 full time employees since 2008 because of budget cutbacks.  The PEF represents some 1,700 scientific and technical workers at DEC.  Wayne Bayer, a shop steward for PEF, advised lawmakers that his union continues to support a moratorium on hydrofracking because existing staff shortages at DEC do not support this labor-intensive mission.


Based upon Commissioner Martens’ statements and the comments of Albany lawmakers, it does not appear that any significant hydraulic fracturing activity will be permitted until 2013, at the earliest.  We should look to any new DEC staff hires as a sign of New York’s commitment to allow fracking to commence.

Public Comment For NYS’s Draft Hydro Fracking Draft Regulations


Recently, New York DEC issued its draft regulations for hydraulic fracturing based on the proposed requirements in the revised supplemental generic EIS released earlier this month. Public comment began yesterday and will run concurrently with the public comment period on the DSGEIS, which ends on December 12.  DEC  also released the proposed SPDES general permit for storm water discharges associated with hydraulic fracturing.  Public hearings will be held during November and here in New York on Nov. 30 at Tribeca Performing Arts Center. No permits can be issued for hydraulic fracturing until the SGEIS is finalized and the DEC issues the required Findings Statement.  The summary of express terms can be found on the DEC website at  http://www.dec.ny.gov/regulations/77373.html

Marcellus Shale Progress Addressing Methane Contamination

At a recent Shale Gas Insight conference in Philadelphia, Aubrey McClendon, the outspoken Chairman of Chesapeake Energy, expressed optimism concernining progress made by industry to address methane contamination of drinking water supplies due to faulty gas well construction. According to McClendon, "Problem identified; problem solved".  However, according to the Times-Tribune writer, Laura Legere, DEP data concerning environmental violations demonstrates that McClendon’s optimism may be premature and that problems with cemented steel well casings designed to protect groundwater from gas and fluids in Marcellus wells perist.  Of course, casing and cementing violations do not necessarily indicate that gas has migrated or will migrate into drinking water supplies. Moreover, methane is present in many water wells in PA from natural pathways unrelated to gas drilling.  However, the crux of environmentalists’ opposition  to hydrofracking appears to center on the gas casing and cementing concerns.  In his comments, McClendon credited an "updated and customized casing system" included in PA state regulations which will hopefully prevent new instances of gas migration.  It is recognized, however, that the geology in Marcellus Shale is neither uniform nor predictable and that the geologic issues are complex.  In planning for Marcellus Shale natural gas exploration in New York, NYDEC personnel have taken to heart (we hope) the lessons of  PA’s experience–good and bad–with hydrofracking and will craft a set of regulations in NY that will promote safe natural gas exploration on a sound economic footing. DEC’s website contains a detailed discussed of DEC staffers’ visit to PA in July ’11 that detailed the environmental issues in PA that NY needs to address in its regulatory framework.