Senate ENR Committee Forum On NatGas Shale Development

May 23: The Senate Energy & Natural Resources (ENR) Committee, Chaired by Senator Ron Wyden (D-OR), with Ranking Member Lisa Murkowski (R-AK), held its second NatGas forum -- this one focused on Shale Development: Best Practices and Environmental Concerns. Witnesses at the forum included representatives from: XTO Energy Inc.; Noble Energy, Inc.; Anadarko; EQT Corporation; Environmental Defense Fund; Natural Resources Defense Council; Sierra Club; Texas Railroad Commission; Bureau of Land Management; Baker Hughes; Halliburton; West Virginia Environmental Council; Interstate Oil and Gas Compact Commission; Nebraska Oil and Gas Conservation Commission; and U.S. Department of the Interior, Bureau of Land Management. Both Senators Wyden and Murkowski delivered opening statements.

 

    In an release, Chairman Wyden encouraged industry leaders, environmentalists and members on both sides of the aisle to build on a commitment made at the meeting to work collaboratively to improve domestic production of natural gas. He said, "Today, we heard from leaders in the natural gas industry, from the environmental community and committee members on both sides of the aisle, all of whom agree we must continue to work, using a bipartisan approach, to address the concerns associated with increased natural gas production. There are substantial environmental questions here, but there's no difference of opinion, at least in the Senate, that this is something where we need to try to find common ground. I think there's a real opportunity for progress."

   

    Chairman Wyden pointed to Texas, where less than half of a percent of shale gas is burned off, or flared, as a potential model for other areas, where up to 30 percent of gas is flared. In addition to addressing fracking disclosure and flaring, Wyden emphasized the importance of finding the best practices to limit methane emissions and find ways to better manage water resources in areas where development is taking place. Wyden has pledged to continue discussions with colleagues and stakeholders to find ways to incorporate and advance ideas and suggestions that surfaced in the roundtables.

    Senator Murkowski said, ". . .the shale gas boom has clearly been a game changer for our country. It's allowed us to access an abundant, affordable and clean source of domestic energy. The potential benefits to our economy are clear and we should do everything we can to make sure we don't mess it up. I support strong regulation of gas production, but I continue to believe that the states are best positioned to address and respond to environmental and other community concerns within their borders. This resource is too important to our future economic development and energy security to move forward in any other way."    

    The meeting completed the committee's series of three natural gas roundtables, which allowed a broad group of stakeholders to exchange ideas in a less formal setting on the many issues facing the country as a result of increased natural gas production, including pipeline infrastructure and transportation, domestic supply and exports and best practices and environmental concerns in the extraction of natural gas from shale.

    Access the NatGas Forum3 website for links to all testimony, opening statements and a webcast (click here). Access a release on the forum from Sen. Wyden (click here). Access a release on the hearing from Sen. Murkowski (click here). Access the NatGas Forum1 website for links to all testimony, opening statements and a webcast (click here). Access the NatGas Forum2 website for links to all testimony, opening statements and a webcast (click here).  [#Energy/NatGas, #Energy/LNG]

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House GOP Approves Keystone XL Pipeline Bill (HR3)

May 22: The U.S. House of Representatives passed The Northern Route Approval Act (H.R. 3) by a vote of 241-175. The bill, sponsored by Representative Lee Terry (R-NE) would approve the construction, operation, and maintenance of the Keystone XL pipeline and eliminate the requirement for a Presidential permit. Nineteen Democrats joined 222 Republicans to pass the bill. No Republicans voted against it. Rep. Terry issued a statement saying:

"When the President went to a manufacturing facility to promote his executive order designed to expedite the federal permitting process; he highlighted how significant delays hamper job creation.  So it's timely the House today passed my legislation to approve the Keystone XL Pipeline. Congress wouldn't have acted without all of the bureaucratic tricks and delays holding back this important project. It's been over 1,700 days since the initial permits were filed. That's longer than it took the Greatest Generation to win WWII and longer than it took Lewis and Clark to walk the Louisiana Purchase and back. If signed into law, it's estimated that my legislation will create up to 20,000 new jobs directly related to the construction of the Keystone Pipeline and another 120,000 indirect jobs will be created for companies like the one the President visited last week.

"I came to Congress because I want to make America energy independent with an all-of-the-above energy strategy and end our dependence on oil from OPEC nations whose interests aren't always our interests.  This bill strengthens the relationship with our country's largest trading partner who I believe much rather do business with America rather than with the Chinese.It's taken five years and 15,000 pages of environmental reviews to get to this point.  Despite all of the delays, the President's own State Department has said that there are no significant impacts to the environment for this project.

"Some say that my legislation can't become law because it won't pass the Senate. But earlier this year, the Senate voted with a filibuster-proof majority urging the construction of this important infrastructure project. Senator Reid should listen to the 70 percent of Americans who want cheaper gas prices; energy independence; and, the jobs that will be created when my legislation is signed into law and immediately consider this bill for an up-or-down vote. Our nation of builders needs these jobs. I thank my colleagues for their support today because it's time to build the Keystone XL Pipeline."

    Representative Henry Waxman (D-CA), Ranking Member of the Energy and Commerce Committee, and a strong opponent of the project spoke on the House Floor prior to the vote and said:

"Today, the House Republicans are making the fourth attempt in two years to grant special treatment to TransCanada's Keystone XL tar sands pipeline.  That's what happens when you let the oil companies set the agenda. Rather than tackling the real problems facing American families, we're passing legislation to exempt a foreign company from the rules that every other company in America has to follow.  And of course last week, we voted for the thirty-seventh time to repeal the Affordable Care Act.  We're trampling our rule of law to speed Canada's dirty tar sands oil to the Gulf, where it can be refined and sent to other countries tax-free.  That's great for tar sands developers and refiners, like the Koch brothers and Valero.    

"But this bill will hurt American families.  It won't lower gas prices by a single penny; it may even raise them.  It will lock us into more global warming and risk our farmlands and our water supplies. No wonder Americans are cynical about Congress. I oppose the Keystone XL tar sands pipeline because it will worsen climate change. Keystone XL will lock the United States into decades of dependence on dirtier tar sands crude, reversing the carbon pollution reductions we have been working so hard to accomplish.  Experts tell us that building Keystone XL will triple production of the tar sands.  And that's simply not consistent with any future scenario for avoiding catastrophic climate change. 

"We don't need it.  We have our own sources of oil here in the United States.  And we're using less oil because of our efficiency in new cars that are getting better mileage. I oppose this bill for these reasons.  But even if you support the pipeline, you should oppose this bill. H.R. 3 is an extreme bill.  It grants a regulatory earmark to TransCanada, exempting it from all environmental requirements. It's also unnecessary.  The State Department is carrying out their review of this highly controversial project. H.R. 3 would approve the pipeline by fiat, lock out the public, eliminate the President's authority to balance competing interests, and stop federal agencies from ensuring that if the project does go forward, we do it as safely as possible. The Keystone XL tar sands pipeline is a bad deal for America.  We get all the risks, while the oil companies reap the rewards.  But even if you support it, this bill is harmful and unnecessary.  I urge my colleagues to vote no on H.R. 3."

    Republican Members of the Energy and Commerce (E&C) Committee voiced their strong support for building the Keystone pipeline during the debate on the House floor. They listed a broad range of diverse organizations representing American workers and job creators have lent their support to this commonsense bill. Committee Chairman Fred Upton (R-MI) reminded that similar legislation was needed 40 years ago to achieve construction of the game-changing Trans-Alaska Pipeline. He said, "This is not the first time Congress has debated a pipeline project held captive by federal red tape despite its great potential to create jobs and increase the supply of North American energy. Forty years ago, we faced a very similar situation with the Alaska pipeline. It took an act of Congress to break the bureaucratic impasse, limit the litigation, and achieve the Alaska pipeline's construction, and now we must do the same for Keystone XL. H.R. 3, the Northern Route Approval Act, will end the needless delays and finally allow construction of this landmark jobs and energy infrastructure project."

 

    On March 1, 2013, the Department of State (DOS) posted a copy of the Environmental Resources Management (ERM) contract and organizational conflicts of interest disclosures. March 8, 2013, U.S. EPA announced the availability of the Draft SEIS on its website. On April 22, 2013, the comment period on the Draft Supplemental Environmental Impact Statement closed. DOS is now reviewing the comments and will make revisions to the Draft SEIS as appropriate. Next, DOS will seek the views of other agencies identified in Executive Order 13337, and make a determination as to whether issuance of a Presidential Permit for the Keystone XL pipeline would serve the national interest. The Department intends to provide an additional opportunity for the public to comment during the National Interest Determination (NID) period that will begin with the release the Final SEIS. On May 15, 2013, the U.S. Fish and Wildlife Service issued their Biological Opinion for the proposed Keystone XL pipeline to the Department, which was prepared consistent with the Endangered Species Act.

 

    The National Wildlife Federation (NWF) indicated that more than 1 million comments from Americans requested that the State Department reject Keystone XL.  "Given the anti-environmental makeup of this Congress, the Terry bill was expected to pass by a wide margin, but numbers like these obviously made lawmakers take note.  As NWF president and CEO Larry Schweiger said about the KXL pipeline: "It's the wrong approach to put a foreign energy company ahead of more than 1 million Americans who have expressed concern for our nation's wildlife, energy security and public health." NWF warned, "The risks of Keystone XL are huge; the reward is 35 permanent jobs in exchange for higher gas prices, oiled wildlife and communities, and another step towards climate calamity."

 

    The American Petroleum Institute (API) President and CEO Jack Gerard welcomed the House approval of H.R. 3 and said, "This pipeline is clearly in the national interest and most Americans agree. Thousands of folks have joined pro-KXL rallies across the country, public polls show robust support for the project and bipartisan backing remains strong in Congress. After four comprehensive federal reviews and a Nebraska review, the analysis is unwavering: Keystone XL is environmentally sound, a safe method of acquiring the energy our country needs, and strengthens our ties to an important ally. Denying this pipeline would be another blow to thousands of out-of-work Americans and our nation's energy security. We need the pipeline approved now. The ongoing Keystone XL delay has sent a signal to all Americans that jobs and energy security are not a priority to some in government. However, we have bipartisan leadership on Capitol Hill; we just need leadership from the president to help our fellow citizens get back to work."    

 

    Access a release from Rep. Terry (click here). Access a release and video from Rep. Waxman (click here). Access a release and video from GOP E&C members including a list of supporting groups and Alaska Pipeline comparison (click here). Access the DOS Keystone XL website for complete background and links to documents (click here). Access a release from NWF with links to related information (click here). Access a release from API (click here). Access legislative details for H.R.3 including the roll call vote (click here). [#Energy/KXL]

 

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"Groundbreaking, Bipartisan Agreement" To Modernize TSCA

May 22: U.S. Senators Frank Lautenberg (D-NJ) and David Vitter (R-LA) announced what they called a "groundbreaking, bipartisan agreement" to modernize the Toxic Substances Control Act (TSCA) and ensure the safety of everyday consumer products to better protect American families. The Senators said the legislation would significantly update and improve TSCA, which has proven ineffective and is criticized by both the public health community and industry. The Lautenberg-Vitter legislation would, for the first time, ensure that all chemicals are screened for safety to protect public health and the environment, while also creating an environment where manufacturers can continue to innovate, grow, and create jobs.

    The Lautenberg-Vitter "Chemical Safety Improvement Act of 2013" is co-sponsored by U.S. Senators Kirsten Gillibrand (D-NY), Mike Crapo (R-ID), Richard Durbin (D-IL), Lamar Alexander (R-TN), Charles Schumer (D-NY), James Inhofe (R-OK), Tom Udall (D-NM), Susan Collins (R-ME), Mary Landrieu (D-LA), Marco Rubio (R-FL), Joe Manchin (D-WV), John Boozman (R-AR), Robert Menendez (D-NJ), and John Hoeven (R-ND).

 

    Under current law, U.S. EPA can call for safety testing only after evidence surfaces demonstrating a chemical may be dangerous. As a result, EPA has only been able to require testing for roughly 200 of the more than 84,000 chemicals currently registered in the United States, and has been able to ban only five dangerous substances since TSCA was first enacted in 1976. These shortfalls led the Government Accountability Office (GAO) to identify TSCA as a "high risk" area of the law in 2009.

    Senator Lautenberg, who first introduced legislation to reform TSCA in 2005 said, "This bipartisan agreement is an historic step toward meaningful reform that protects American families and consumers. Every parent wants to know that the chemicals used in everyday products have been proven safe, but our current chemical laws fail to give parents that peace of mind. Our bipartisan bill would fix the flaws with current law and ensure that chemicals are screened for safety." Senator Vitter, the Ranking Member of the Senate Environment and Public Works (EPW) Committee said, "Our bill strikes the right balance between strengthening consumer confidence in the safety of chemicals, while also promoting innovation and the growth of an important sector of our economy. Chemical manufacturing is a big part of Louisiana's economy and across the country, and the Chemical Safety Improvement Act establishes a program that should provide confidence to the public and consumers, by giving the EPA the tools it needs to make critical determinations while providing a more transparent process. The benefit of such a system is that industry should also have more confidence that the federal system works to facilitate innovation and grow our economy." 

    Richard Denison, Senior Scientist, Environmental Defense Fund (EDF) said, "This bill is both a policy and political breakthrough. It gives EPA vital new tools to identify chemicals of both high and low concern, and to reduce exposure to those that pose risks. And while this bill represents a hard-fought compromise, it opens, at last, a bipartisan path forward to fix our badly outmoded system to ensure the safety of chemicals in everyday use." While supporting the bill, EDF also said, "There are some deficiencies in the legislation. . . The bill contains too few deadlines by which EPA needs to initiate and complete actions. Also, while EPA would be required to consider the heightened vulnerability of some subpopulations (including infants and children), EPA would have only limited means to address disproportionately high chemical exposures experienced by residents in many communities in America."

    Cal Dooley, President and CEO of the American Chemistry Council (ACC) said, "From life-saving medicines, to energy efficient build materials, chemistry is responsible for countless innovations that have transformed society. America's chemical industry is a critical source of economic growth and good-paying jobs across the country. Achieving sound, balanced TSCA reform that enhances public confidence in the safety of chemicals and enables America to remain the world's leading innovator is our top priority. This bipartisan compromise legislation will put safety first, while also promoting innovation, economic growth and job creation -- goals that are critical to our industry, to our nearly 800,000 employees and to the many other industries that rely on the products of chemistry. In particular, we appreciate the tremendous work of Senators Lautenberg and Vitter and their staffs to develop a solution that could garner support from both the environmental community and industry. Through their deep commitment to this issue, we now have a historic legislative opportunity that can be embraced by both sides of the aisle, an accomplishment all too rare in Washington today."

    According to a release from the Senators, in contrast to existing law, the Lautenberg-Vitter "Chemical Safety Improvement Act of 2013" would:

• Require Safety Evaluations for All Chemicals: All active chemicals in commerce must be evaluated for safety and labeled as either "high" or "low" priority chemical based on potential risk to human health and the environment. For high priority chemicals, EPA must conduct further safety evaluations.
• Protect Public Health from Unsafe Chemicals: If a chemical is found to be unsafe, the Environmental Protection Agency (EPA) has the necessary authority to take action. This can range from labeling requirements to the full phase-out or ban of a chemical.
• Prioritize Chemicals for Review: The Environmental Protection Agency will have to transparently assess risk, determine safety, and apply any needed measures to manage risks.
• Screen New Chemicals for Safety: New chemicals entering the market must be screened for safety and the EPA is given the authority to prohibit unsafe chemicals from entering the market.
• Secure Necessary Health and Safety Information: The legislation allows EPA to secure necessary health and safety information from chemical manufacturers, while directing EPA to rely first on existing information to avoid duplicative testing.
• Promote Innovation and Safer Chemistry: This legislation provides clear paths to getting new chemistry on the market and protects trade secrets and intellectual property from disclosure.
• Protect Children and Pregnant Women: The legislation requires EPA to evaluate the risks posed to particularly vulnerable populations, such as children and pregnant women, when evaluating the safety of a chemical-a provision not included in existing law.
• Give States and Municipalities a Say: States and local governments will have the opportunity to provide input on prioritization, safety assessment and the safety determination processes, requiring timely response from EPA, and the bill establishes a waiver process to allow state regulations or laws to remain in effect when circumstances warrant it.

    Access a release from the Senators (click here). Access a separate release from ACC (click here). Access a separate release from EDF (click here). [#Toxics]

 

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U.S. Chamber Report Critical Of "Sue and Settle" Process

May 20: A report released by the U.S. Chamber of Commerce entitled, Sue and Settle: Regulating Behind Closed Doors, indicates that the "sue and settle" process, where environmental advocacy groups sue Federal agencies to issue regulations by a specific deadline, is being abused, "resulting in interested parties being shut out of regulatory decisions by key federal agencies, particularly the Environmental Protection Agency" (U.S. EPA). The report identifies at least 60 different occasions between 2009 and 2012 where the EPA chose not to defend itself in lawsuits brought by special interest advocacy groups and in each case agreed to settlements on terms favorable to those groups. The settlements directly resulted in EPA agreeing to propose more than 100 new regulations, many of which would impose compliance costs in the tens of millions and even billions of dollars. The Fish and Wildlife Service (FWS) has also been receptive to sue and settle lawsuits, agreeing to propose adding over 700 new candidates to the Endangered Species list. The "sue and settle" issue has been a major concern of Senate Republicans during the nomination process for the President's nominee of Gina McCarthy to head EPA [See WIMS 5/16/13].

    Bill Kovacs, the Chamber's senior vice president for the Environment, Technology and Regulatory Affairs said, "It is clear that the sue and settle process is increasingly being used as a technique to shape agencies' regulatory agendas, without input from the public or the regulated community. From a new wave of endangered species listings to the EPA's federalization of the Chesapeake Bay cleanup program, to the federal takeover of regional haze programs, this report outlines how recent sue and settle arrangements have been used to serve the ends of a few favored interest groups."

    In a release the Chamber indicates that as a result of the sue and settle process, the agency submits to the binding terms of settlement agreements, using congressionally appropriated funds to achieve the demands of specific outside groups. This process also allows agencies to avoid the normal protections built into the rulemaking process -- review by the Office of Management and Budget and the public, and compliance with executive orders -- as the agency's new obligation is created.

    The Chamber indicates that regulations resulting from sue and settle agreements include the Utility MACT rule, costing up to $9.6 billion annually; the Chesapeake Bay Clean Water Act Rules, costing up to $18 billion; and the various regional haze rules that EPA has imposed on the states, which are estimated to total $2.16 billion in new costs. FWS spent more than 75% of their FY 2011 allocation for endangered species listing and critical habitat designation to take actions required by court orders or settlement agreements resulting from litigation. Kovacs added, "Sue and settle allows agencies to avoid the normal protections built into the rulemaking process, including Congressional oversight and reviews by the public. The most effective solution to sue and settle lies with Congress, and they should pass recently-introduced legislation to address this issue without delay. Our hope is that by shining the light on how this process is abused by special interest groups, we can enact much-needed reforms to protect the integrity of the rulemaking process."

    Representative Doug Collins (R-GA), and Senator Charles Grassley (R-IA), have introduced companion legislation, H.R.1493 & S.714, respectively, to eliminate "sue and settle." The Members issued a joint release on April 11, 2013. Senator Grassley said, "Sue-and-settle litigation damages the transparency, public participation and judicial review protections Congress has guaranteed for all of our citizens in the rulemaking process.  And, it's a tremendous burden on job-creating businesses, especially small businesses. This kind of regulatory litigation also adversely affects the ability of the executive branch to engage in sound and principled decision-making. The goal of this bill is to make sure all citizens, especially those directly impacted by a proposed regulation, have a meaningful opportunity to participate in the rulemaking process and help ensure the procedure and process used to create these regulations are made in the open. America's system of lawmaking and judicial review shouldn't be distorted or manipulated."

    Representative Collins said, "The Obama Administration has empowered agencies to subvert the legislative process and manipulate the rulemaking system to achieve their pro-regulation agenda. Strong reforms are needed to protect communities and businesses against burdensome regulations that circumvent the rulemaking process. This legislation sheds light on the regulation through litigation that is crippling small businesses in my district and across the nation. Improving the public participation and transparency protections of the Administrative Procedure Act is vital to preserving the integrity of the rulemaking process."

    As part of the nomination process for Gina McCarthy for EPA Administrator, Senator David Vitter (R-LA) has indicated that among other concessions, EPA has agreed to: ". . . post notices of intent on the EPA website as well as commits to establishing a website to post petitions for rulemaking submitted to the Agency." Additionally, Republicans have requested EPA to: "Give intervenors immediate notice of any initiation of settlement discussions that come from legal actions brought against the Agency."

    Access a release from the Chamber (click here). Access an overview, list of rules, recommendations, executive summary, and the complete 54-page report (click here). Access a release from the Members on the legislation (click here). Access the release, letter and agreements from Sen. Vitter (click here). Access legislative details for S.714 (click here). Access legislative details for H.R.1493 (click here). [#All]

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President Signs Infrastructure Permitting Memorandum

May 17: The White House reports that as part of the Administration's effort to make America a magnet for jobs by building a 21st Century infrastructure, the President Obama signed a Presidential Memorandum that will modernize the Federal infrastructure permitting process, cutting timelines in half for major infrastructure projects while creating incentives for better outcomes for communities and the environment. In March 2012, the President issued an Executive Order launching a government-wide initiative to improve the efficiency of Federal review and permitting of infrastructure projects.  Since then, agencies have expedited the review and permitting of 50 major projects, including bridges, transit projects, railways, waterways, roads, and renewable energy.  In just one example, Federal agencies recently approved the Tappan Zee Bridge replacement project in New York, saving up to three years on the timeline of a multi-billion project that will help put Americans back to work.

 

    As a result of the President's Executive Order, agencies have also identified a set of best practices for efficient review and permitting, which range from expanding information technology (IT) tools to strategies for improving collaboration, such as having multiple agencies review a project at the same time, instead of one after the other. The Presidential Memorandum institutionalizes these best practices, directing all relevant agencies to put them into effect.

 

    The permitting modernization effort represents an important component of the President's larger effort to grow the economy, accelerate job creation, and improve U.S. competitiveness by building a 21st Century infrastructure.  Notably, the President's Budget calls for immediately investing $50 billion in our Nation's transportation infrastructure, with $40 billion devoted to "fix-it-first" projects that target areas in the most urgent need of repair. The President also proposed a "Rebuild America Partnership," creating tools to encourage partnerships between the private sector and Federal, State, and local governments to enhance the role of private capital in U.S. infrastructure investment and ensure America has the best transportation, electric, water, and communications networks in the world.

 

    Among other items, the Memorandum provides that, "The Steering Committee on Federal Infrastructure Permitting and Review Process Improvement (Steering Committee), established by Executive Order 13604, shall work with the Chief Performance Officer (CPO), in coordination with the Office of Information and Regulatory Affairs (OIRA) and the Council on Environmental Quality (CEQ), to modernize Federal infrastructure review and permitting regulations, policies, and procedures to significantly reduce the aggregate time required by the Federal Government to make decisions in the review and permitting of infrastructure projects, while improving environmental and community outcomes."

 

    Access a White House release and link to the first annual Report to the President and the Administration's Infrastructure Permitting Dashboard (click here). Access the Memorandum (click here). [#All] 

 

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DOI Releases Updated Proposed Fracking Safety Standards

May 16: The Department of the Interior (DOI) announced the release of an updated draft proposal that would establish what they indicated were "commonsense safety standards" for hydraulic fracturing (or fracking) on public and Indian lands. Following the release of an initial draft proposal in 2012, Interior received extensive feedback, including over 177,000 public comments that helped inform the updated draft proposal. The new proposal maintains important safety standards, improves integration with existing state and tribal standards, and increases flexibility for oil and gas developers. The updated draft proposal will be subject to a new 30-day public comment period.

    DOI Secretary Sally Jewell said, "As the President has made clear, this administration's priority is to continue to expand safe and responsible domestic energy production. In line with that goal, we are proposing some commonsense updates that increase safety while also providing flexibility and facilitating coordination with states and tribes. As we continue to offer millions of acres of America's public lands for oil and gas development, it is important that the public has full confidence that the right safety and environmental protections are in place." DOI indicated that approximately 90 percent of wells drilled on Federal and Indian lands use hydraulic fracturing, but the Bureau of Land Management's (BLM) current regulations governing hydraulic fracturing operations on public lands are more than 30 years old and were not written to address modern hydraulic fracturing activities. The revised proposed rule will modernize BLM's management of hydraulic fracturing operations, and help to establish baseline environmental safeguards for these operations across all public and Indian lands.

    DOI indicated that the updated draft proposal maintains the three main components of the initial proposal: requiring operators to disclose the chemicals they use in fracturing activities on public lands; improving assurances of well-bore integrity to verify that fluids used during fracturing operations are not contaminating groundwater; and confirming that oil and gas operators have a water management plan in place for handling fluids that flow back to the surface. Building on preliminary input from key stakeholders and recommendations from the Department of Energy (DOE) Secretary's Advisory Board in 2011, the BLM proposed a draft rule in 2012 that took into account technologies already in use by companies to protect water resources, and existing methods for improving transparency through disclosure of the chemicals used in fracturing fluids [See WIMS 5/4/12].

    The updated draft proposal addresses many of the more than 177,000 public comments that the BLM received during the initial 120-day public comment period that ended last fall, as well as other feedback received during eight forums and other meetings held with representatives of American Indian tribes. BLM Principal Deputy Director Neil Kornze said, "We know from experience that hydraulic fracturing and horizontal drilling methods can be used safely and effectively, employing many of the best management practices reflected in this draft rule. Our thorough review of all the comments convinced us that we could maintain a strong level of protection of health, safety, and the environment while allowing for increased flexibility and reduced regulatory duplication."

    DOI indicated that the supplemental proposal being released revises the array of tools operators may use to show that water is being protected, and provides more guidance on trade secret disclosure, while providing additional flexibility for meeting these objectives. While the revised draft seeks to establish baseline environmental safeguards across all public and Indian lands, it also complements efforts of several states that are regulating hydraulic fracturing, including Colorado, Wyoming, North Dakota, and Texas. The proposal includes a variance process that allows for deferring to states and tribes that already have standards in place that meet or exceed those proposed by this rule.

    Although the BLM is not proposing a material change in the provision that allows hydraulic fracturing flowback fluids to be stored either in tanks or in lined pits, the BLM is seeking comments on the costs and benefits of requiring flowback fluids to only be stored in closed tanks. A 30-day comment period begins when the proposed rule is published in the Federal Register. DOI indicated that once comments on the updated draft have been collected and analyzed, the BLM expects to issue a final rule that will ensure that operators apply proven cost-effective safety and environmental protection processes when engaging in hydraulic fracturing on public and Indian lands.

    U.S. Senator Lisa Murkowski (R-AK), Ranking Member of the Senate Energy and Natural Resources (ENR) Committee said, "It's my belief that the states are prudently regulating hydraulic fracturing, and that BLM's revised rule should closely track state regulations. Federal regulators seem to acknowledge as much by asking for comments on a process that would allow drilling companies to follow state and tribal regulations that meet or exceed those proposed by this rule. While I'm still reviewing the full rule, it appears BLM has addressed some of the concerns, but we still must guard against duplicative and potentially contradictory regulations."

    The Natural Resources Defense Council (NRDC) President Frances Beinecke issued a statement commenting on the proposed rules saying, "These rules protect industry, not people. They are riddled with gaping holes that endanger clean, safe drinking water supplies for millions of Americans nationwide.  They also put the fate of millions of acres of America's last remaining wild places in jeopardy. With fracking already moving full steam ahead on federal lands, we need protective ground rules for communities and the environment. Instead, this draft is a blueprint for business-as-usual industrialization of our landscapes. The administration has a responsibility to be a leader in guarding against the risks of fracking. They must shift the direction away from industry wish lists and toward drinking water protection. That means addressing the major shortfalls in this draft before issuing a final rule, and preventing expanded fracking from moving forward unless and until sufficient safeguards are in place."

    Michael Brune, Executive Director of the Sierra Club, issued a statement saying, "The Sierra Club is alarmed and disappointed by the fundamental inadequacy of the Bureau of Land Management's new proposed fracking regulations. After reviewing the draft rules, we believe the administration is putting the American public's health and well-being at risk, while continuing to give polluters a free ride. The draft BLM rules ignore the recommendations of the president's own shale gas advisory committee, which called for transparency, full public chemical disclosure, environmental safeguards, and pollution monitoring.

    "Although no amount of regulation will make fracking acceptable, the proposed BLM rules fail even to take obvious steps to make it safer. This proposal does not require drillers to disclose all chemicals being used for fracking and continues to allow trade-secret exemptions for the oil and gas industry. There is no requirement for baseline water testing and no setback requirements to govern how close to homes and schools drilling can happen. The new rules also continue to allow the use of toxic diesel fuel for fracking, as well as open pits for storing wastewater -- two practices that we know to be environmentally hazardous. If President Obama honestly wants to tackle climate change, then he must look for every opportunity to keep dirty fossil fuels in the ground and to double down on clean energy solutions like wind, solar, and energy efficiency. The last thing we should be doing is opening up still more public land to drilling and fracking."

    Erik Milito, the American Petroleum Institute (API) director of upstream and industry operations questioned the Bureau of Land Management's proposed rules. He indicated that rigorous state rules and state-based tools, such as FracFocus.org, are already in place to ensure responsible oil and natural gas development. He said, "States have led the way in regulating hydraulic fracturing operations while protecting communities and the environment for decades. While changes to the proposed rule attempt to better acknowledge the state role, BLM has yet to answer the question why BLM is moving forward with these requirements in the first place. The production of oil and natural gas from shale and tight sand formations is the most significant development in U.S. energy in generations. Confusing the regulatory system would stand in way of economic growth, job creation and the opportunity to generate billions in revenue for federal, state and local governments. We urge the administration and Congress to take a close look at this and other regulatory actions regarding oil and natural gas development. Smart energy policy will position the U.S. to be the world leader in energy development and realize the economic and energy security benefits of that leadership."

    Karen Harbert, president and CEO of the U.S. Chamber's Institute for 21st Century Energy commented saying, "BLM's rule is a solution in search of a problem. States are much better suited to regulate hydraulic fracturing and have done an effective job. The new rule is duplicative to state regulation and the Department of Interior's rule fails to provide a credible rationale as to why another set of regulations are needed. Given that over three quarters of federal lands onshore are already off limits to exploration thanks to this Administration, this draft rule will make what little remains even more expensive and less feasible. This effort by the Administration comes at a time when America should be taking greater advantage of our natural resources to create jobs and improve our economy.  Even more troubling, it could be a harbinger for things to come by setting the stage for regulation on private and state lands as well. "

    National Association of Manufacturers (NAM) Vice President of Energy and Resources Policy Ross Eisenberg commented saying, "While we appreciate that BLM has acknowledged our concerns with the previously deeply flawed regulations, we are disappointed by the decision to still move forward with new regulations that could negatively impact a significant energy source for manufacturers. States have long been the primary regulators of hydraulic fracturing, and right now they are hard at work updating their regulations to protect public health and the environment. Rather than duplicate the states' efforts with a one-size-fits-all federal rule, we believe BLM should first work with states to identify any potential gaps or deficiencies and if any exist, help the states fix them. Reactive federal regulations can harm gains resulting from increased exploration of shale oil and gas. Limiting the comment period for this rule to only 30 days is simply not enough time to evaluate such complex regulations. . . Government policies should encourage development of these resources, and we fear that poorly-crafted regulations could accomplish the opposite. . ."

    Access a release from DOI (click here). Access the prepublication Federal Register notice of Supplemental Notice of Proposed Rulemaking and Request for Comment  (click here). Access a release from Sen. Murkowski (click here). Access a release from NRDC (click here). Access a release from Sierra Club (click here). Access a release from API (click here). Access a release from the U.S. Chamber(click here). Access a release from NAM (click here). [#Energy/Frack]

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Senate EPW Votes 10-8 To Nominate McCarthy As EPA Head

May 16: Following last week's boycott by Republicans on the Senate Environment and Public Works (EPW) Committee [See WIMS 5/9/13], the GOP Members attended today's meeting and unanimously voted against the nomination of Gina McCarthy to be the next Administrator of the U.S. EPA. The 10 Democrats also attended and voted to move the nomination forward for consideration by the full Senate.

 

    Senator David Vitter (R-LA), the Ranking Member of the EPW Committee issued a statement saying that Republicans would attend the meeting. He said that at his meeting yesterday with acting EPA Administrator Bob Perciasepe, EPA committed to take additional steps forward in fulfilling the transparency requests of the Senate EPW Committee Republicans. Vitter responded this morning in a letter saying, "Because these steps forward are significant, we want to thank you and acknowledge progress, including by moving forward with the Committee mark-up of Gina's nomination. Because these steps forward are limited, and do not include everything required under the law, we want to request additional progress, and the EPA's follow through will determine how this nomination process goes forwards. We'll absolutely be holding the EPA to it."

 

    Sen. Vitter specifically said in his letter, "Should major additional progress be made in all of the five categories over the next two weeks, I will strongly support handling the McCarthy nomination on the Senate floor without a cloture vote or any 60 vote threshold. Should all of our requests in the five categories be granted, I will support the McCarthy nomination." The five categories identified and outlined in the letter include: Email and FOIA Policy; Unredacted Emails; Underlying Research Data; Economic Analysis; and "Sue-and-Settle." The letter summarizes the specific "agreed to" actions under each category.

   

    In a related matter,  the American Petroleum Institute (API) Downstream Group Director Bob Greco sent a letter to Sen. Vitter refuting what he called, "inaccurate and misleading statements" about the research being conducted by the Coordinating Research Council (CRC) made by EPA administrator nominee Gina McCarthy in a recent letter.  Greco indicated that McCarthy said EPA and DOE were "denied" a role in the extensive testing on E15 -- a mixture of 15 percent ethanol and 85 percent gasoline -- by the CRC that found the fuel could be dangerous for millions of cars on the road today.

 

   Greco said, "The record shows that before and during the CRC mid-level ethanol blends research program, EPA and DOE played significant roles either directly or through the U.S. national laboratories. . . CRC is a research organization that has been conducting research on fuels, engines and vehicles for more than 70 years. The CRC tests are developed and managed by the same company automotive engineers who design and build cars. We have great confidence in the ability of the automotive and fuels experts who sit on CRC committees to conduct well-conceived and thorough technical investigations of consumer acceptance and vehicle safety-related issues associated with the use of mid-level ethanol blends in vehicles operated by our mutual customers. . . The key objective for the oil and the auto industries in undertaking the comprehensive CRC mid-level ethanol blends research program was to ensure that the safety and performance of our mutual customers' vehicles are not compromised or otherwise adversely affected by E15. CRC met those goals -- EPA and DOE did not."

 

    Access a webcast of today's nomination meeting (click here). Access the statement from Sen. Vitter and the letter to Perciasepe (click here). Access a release from API with links to related information including the letters (click here). [#All]

 

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