Replies to post #4472 on The Rising Influence of Rising Affluence

[DewDiligence]

The local NSTAR plant (Kendall Square, Cambridge, MA - hardly a shale gas capital) constantly stinks of thiophane/mercaptan yet the local lefties aren't up in arms about the obvious leakage problem in their own backyard.

Ditto for the town of Wellesley. On a walk through almost any neighborhood, the mercaptan smell is unmistakable.

[DewDiligence]

U.S. Sets Rules for Fracking on Federal Land

http://online.wsj.com/article/SB10001424052702303877604577382460699241978.html

›May 3, 2012, 7:27 p.m. ET
By TENNILLE TRACY

The Obama administration will soon issue sweeping new environmental-safety rules for hydraulic fracturing on federal land, setting a new standard that natural-gas wells on all lands eventually could follow.

The rules, which are likely to be unveiled by the Interior Department within days, are designed to address concerns that the method of extracting natural gas known as "fracking" can contaminate groundwater. Among other things, they create new guidelines for constructing wells and treating waste water, according to a draft of the proposed rules reviewed by The Wall Street Journal.

At the same time, the department loosened a proposed requirement for companies tied to disclosing the chemicals they use to extract natural gas from the earth, after the industry complained an earlier version would slow drilling too much.

The change, which disappointed environmentalists, is a fresh sign that the administration is heeding industry concerns after Republican complaints of overregulation. Last month, the Environmental Protection Agency gave the industry two years to comply with new air-quality standards for oil and natural-gas wells after the industry complained it would be difficult to meet new standards.

Initially, the department wanted energy companies to specify in advance which chemicals they put into fracking fluids. Under the draft rules, they would instead have to identify the chemicals after they have already put them into the ground. In the weeks leading up to the proposal of the rules, several oil and natural-gas companies, including Exxon Mobil and Apache Corp., met with top White House officials to weigh in on possible changes, according to public-meeting records.

"We fully expect the rule will be better than it was originally proposed," said Jack Gerard, president of the American Petroleum Institute, the main lobbying arm of the oil and natural-gas industry. Apache declined to comment. ExxonMobil declined to comment.

The Natural Resources Defense Council praised the administration for reducing the potential for contamination under the new rules but said it was disappointed the department had loosened the chemical-disclosure requirement.

"The bottom line for us is that we think the [Interior Department] should have strong rules that should not be weaker than what any state has on its books," NRDC senior policy analyst Amy Mall said. "They should be setting a model for the nation."

An administration official familiar with the rules said the standards were "still under development" and that "it would be inappropriate to speculate on what the complete draft may include."

The fracking rules apply to natural-gas drilling on federal and tribal lands, not on private or state-owned lands. While an estimated 25% to 30% of fracked wells are on federal land, according to Baird Equity Research, energy experts say the new rules could serve as a template for state officials who oversee energy production.

The department oversees oil and natural-gas operations on about 700 million acres. Of the 3,400 wells that are drilled on public lands each year, about 90% use hydraulic fracturing.

…The expected rules are aimed at ensuring the process doesn't contaminate groundwater. Environmental groups, among the most vocal opponents of the drilling method, say hydraulic fracturing should be stopped until experts can confirm it is environmentally safe. Some city governments have banned hydraulic fracturing within their districts.

The U.S. government hasn't produced any evidence that contamination occurs. The EPA is studying the issue for a report scheduled to be released in 2014. It recently backed away from claims that hydraulic fracturing contaminated the groundwater in Wyoming and Pennsylvania, at sites developed by Encana Corp. and Cabot Oil & Gas . The industry contends that hydraulic fracturing is safe when a well is constructed correctly.

President Barack Obama has started to promote natural gas as a valuable domestic resource that could replace coal in the generation of electricity and supplant oil as a fuel for cars. Republicans and the natural-gas industry contend the president is inhibiting production of natural gas with the new regulations, even as he promotes natural gas to voters as an alternative to traditional fuels. The White House recently formed a task force to coordinate the government's efforts to study and regulate the drilling method.

Oil and natural-gas companies for several years have resisted calls to disclose which chemicals they use during fracking, claiming they would force them to reveal proprietary information. Since then, many companies have started to provide that information voluntarily. Some states already require disclosure.

Companies say state officials are in a better position than federal officials to regulate hydraulic fracturing because they understand the local geology and community concerns.

"There's no way that adding these additional requirements is not going to slow down further permitting on federal lands," said Kathleen Sgamma, a vice president at the Western Energy Alliance, which represents oil and gas companies.‹