U.S. representatives unveil FRAC ACT to close “Halliburton loophole”

Four legislators from Colorado, New York and Pennsylvania introduced Tuesday a long-expected bill aimed at returning federal oversight to hydraulic fracturing, a process used in natural gas drilling, much to the chagrin of industry groups that argue the bill would result in thousands of lost jobs and billions in unrealized revenue.

U.S. Representatives Diana DeGette, D-Colo., Maurice Hinchey, D-N.Y., and Jared Polis, D-Colo., propose a bill that would reverse a section of the Energy Policy Act of 2005 that, in effect, exempts hydraulic fracturing from the Safe Drinking Water Act, enacted in 1975 by the Environmental Protection Agency. Sen. Bob Casey, D-Penn., sponsors the Senate version of the bill.

Hydraulic fracturing is a process whereby millions of gallons of water, sand and chemicals – some harmful in large amounts – are pumped into the ground to break up oil and gas shales to allow for easier extraction of the commodities. The industry insists the method is safe and well-regulated by states, while some opponents say the method is dangerous, could pollute underground water tables and now is a national concern in which a federal standard is needed. Hydraulic fracturing is used in most natural gas wells drilled in the Barnett Shale.

The FRAC ACT, or Fracturing Responsibility and Awareness of Chemicals Act, would amend the Safe Drinking Water Act to require oil and gas companies to disclose the chemicals they use in their hydraulic fracturing processes.

“When it comes to protecting the public’s health, it’s not unreasonable to require these companies to disclose the chemicals they are using in our communities – especially near our water sources,” said DeGette, vice chair of the committee on energy and commerce, in a June 9 statement. “Our bill simply closes an unconscionable Bush-Cheney loophole by requiring the oil and gas industry to follow the same rules as everyone else.”

Washington, D.C.-based lobbying group Energy In Depth, comprised of dozens of industry organizations, issued a statement denouncing the bill as a ignorant to state regulators and an “unnecessary financial burden on a single small-business industry, American oil and natural gas producers.”

“The legislation introduced in Congress today is based on the notion that hydraulic fracturing is unsafe, unregulated, and that it benefits from a special exemption to federal law. Not a single one of these premises are true,” said Lee Fuller, policy director for Energy In Depth, in a June 9 statement. “What is true is that hydraulic fracturing has been used for more than 60 years to access and produce oil and gas resources that would have otherwise remained trapped under miles of rock – and that it’s been regulated assiduously by the states for at least that long.”

The group argues the bill could result in more than half of U.S. oil wells and one-third of gas wells closing; $4 billion in lost revenue to the federal government and domestic natural gas production to drop by 245 billion cubic feet per year.

For more information on the bill, see www.fwbusinesspress.com/display.php?id=10369.