OilandGasMonitor.com – Breaking Ground: New Frack Rules More of Same “Permitatorium” for Federal Lands

image001It should come as no surprise that no one is happy with the new fracking rules issued by the U.S. Interior Department’s Bureau of Land Management. While we wait out the public comment period (that should have taken 30 days but could take 120 or 360 or, let’s face it, we’ll be having this debate as long as there is an oil and gas industry), let’s discuss the key points.

Actually, there are no new key points of note. The proposed new rules formalize on a federal level the same requirements the industry already complies with at the state and local level: a cement bond log, pressure testing of well casings, frack recipe disclosure, a flowback water plan, and proper permitting. No big deal, right?

From the department of redundancy department

It’s not a big deal if you don’t mind duplication of effort that has no measureable impact on the end result except to cost producers more time and money while depriving the country of much-needed tax and royalty revenues, jobs and increased energy security. No big deal at all.

Experts in the oil and gas industry estimate that the new rules will add 100 days to the already lengthy (up to 290 days) federal permitting process (versus about 30 days for state permitting), and could cost as much as $250,000 more per well. (The BLM, naturally, underestimated the extra expense at a laughable $15,000 per well.)

Production on federal lands has already fallen during the Obama administration, due to the expense and difficulty of meeting the extensive permitting requirements that have created a de facto “permitatorium:” The Obama administration drags its feet on permits and adds more and more complexity to the tangle of rules and requirements until it becomes the equivalent of banning fracking vs. taking the heat for an outright ban on activity that spurs all that pesky job creation, economic benefits, and energy security. Production on public lands only accounts for 13 percent of natural gas output and 5 percent of oil output, though it could be much higher.

Despite the decline in production on federal lands and the anti-fracking lobby’s best efforts to shut it all down, U.S. crude oil production is at its highest in eight years and natural gas production has surpassed its 1973 peak. Foreign imports have fallen from 57 percent to 45 percent. This should be good news that’s welcomed by a nation struggling with job growth, economic growth, and still dangerous levels of dependence on foreign oil, but the anti-fracking folks have dampened any sense of celebration we as a nation could enjoy.

The fact is, the states have been successfully policing 1.2 million fracking operations for more than half a century. They are the best regulatory bodies to regulate oil and gas production based on their particular geologic and hydrologic needs. The DOI has no budget, no expertise and no personnel to take on this challenge right now—the BLM will need to hire 18 new full-time employees to deal with the new permitting and disclosures process. It’s not needed and, frankly, the government can’t afford it.

Caving to anti-fracking groups despite all evidence to the contrary

As the feds keep caving into environmental groups that have more persistence than actual data to support their claims, ongoing and past research keeps showing the same thing: fracking isn’t the big bad environmental bogey man.

The EPA has recently issued a new report on greenhouse gas emissions, finding that methane emissions from oil and gas industry operations fell 20 percent more from 1990 through 2010 than its previous estimates – even as production of natural gas rose by 40 percent — thanks to industry’s largely voluntary improvements in pollution controls on pipelines, wells, and other infrastructure.

Total methane emissions from natural gas industry operations are about the same as those from cow flatulence and belching, yet you don’t hear any calls from the environmental pressure lobby for curbs on those methane emissions.

MIT recently released a study showing that fracking produces a scant fraction more methane into the air than conventional gas drilling. In light of the orders-of-magnitude gains in production from fracking shale gas, this negligible increase becomes a non-issue.

The EPA report is just one more example of serious, objective science serving to tear down the latest bogeyman the environmental pressure lobby has created to frighten the public. And no one in his right mind can say the EPA, especially under the current administration, is in industry’s pocket.

CO2 emissions from coal were down 18 percent in 1Q 2012. That was the lowest-first quarter CO2 emissions from coal since 1983 and the lowest for any quarter since April to June 1986. The DOE said: “The decline in coal-related emissions is due mainly to utilities using less coal for electricity generation as they burned more low-priced natural gas.” That low-priced gas resulted from a surge in production made possible only through the growing use of shale gas made possible by fracking.

In other words, fracking to produce more natural gas ultimately reduces greenhouse gas emissions. This effectively obliterates the spurious argument of fracking opponents that natural gas somehow equates to coal as an environmental threat.

Regulators can’t resist junk science

For decades now environmental activists and tort lawyers have pursued a relentless campaign to expand the list of substances they claimed have the potential to increase the risk of birth defects or cancer, often supported by junk science studies funded by agenda-driven wealthy foundations.

The template for this junk science was laid down with the saccharine scare. After the scary headlines and histrionics died down, we learned that rats fed the human equivalent of bathtubs full of the stuff developed some tumors. That was nonsense. The dose makes the poison. Even air and water can reach toxic levels with excessive intake by humans.

Unfortunately, our lawmakers keep falling for it. These latest rules from the BLM are just another example of our government’s inability to sort fact from fiction to protect the economic interests of this nation.