Friday, April 22, 2011

The Truth About the Halliburton Loophole in New York

DEC clearly discusses the perceived "Halliburton loophole" on their website.

The exemption does NOT affect the regulations of natural gas wells in New York State! More information can be found about the UIC program by reading through the GEIS.

Why are we still discussing this issue?

Effect of Federal Safe Drinking Water Act, Clean Water Act and Emergency Planning and Community Right-to-Know Act

Questions have been raised about whether certain specific exemptions or exclusions in federal law prevent the Department from regulating Marcellus Shale well drilling and hydraulic fracturing. They do not. As explained below, the Department retains full authority to regulate these activities to prevent pollution and to protect the environment and public health and safety.

Safe Drinking Water Act

The federal Energy Policy Act of 2005 amended the Underground Injection Control ("UIC") provisions of the Safe Drinking Water Act to exclude hydraulic fracturing from the definition of "underground injection." The objective of the federal UIC program is to protect underground sources of drinking water from contamination by underground injection of hazardous and non-hazardous fluids. However, protection of groundwater resources during oil and gas extraction activities is a responsibility of state government. The cited federal amendment in no way hampers or denigrates the Department's authority over oil and gas well development in New York, including oversight of hydraulic fracturing activities to ensure protection of groundwater resources.

Clean Water Act

The federal Energy Policy Act of 2005 defined "oil and gas exploration, production, processing, or treatment operations or transmission facilities" to include all field activities and operations related to these facilities "whether or not such field activities may be considered to be construction activities." The effect was to exempt well site activities that disturb one or more acres from the Clean Water Act's requirement for National Pollutant Discharge Elimination System ("NPDES") stormwater permits for sediment runoff from construction sites. The Environmental Protection Agency ("EPA") thereafter modified its NPDES storm water permit regulations to reflect the revision. On May 23, 2008, in National Resources Defense Counsel vs. USEPA, the U.S. Court of Appeals for the Ninth Circuit filed an Opinion disagreeing with the EPA's interpretation of the statute, vacating the modified rule, and remanding the matter back to the EPA for further proceedings.
The federal exemption never hindered the Department's authority to require appropriate erosion and sedimentation controls at all well sites, regardless of their size. Erosion and sedimentation control measures deemed appropriate by the Regional Minerals Manager must be maintained at all well sites, even sites that are smaller than one acre. Department inspectors check the integrity and effectiveness of these controls, and order immediate repairs when needed.

Emergency Planning and Community Right-to-Know Act (EPCRA)

EPCRA was enacted by Congress in response to concerns raised after the 1984 incident in Bhopal, India, when a large toxic release killed thousands of people. Congress specified that EPCRA applies to the manufacturing sector, as defined by specific Standard Industrial Codes (now replaced by North American Industry Classification codes). Oil and gas extraction activities do not fall within the manufacturing sector, and are not among the additional industry sectors added to EPCRA in 1997.

Existing well construction and fluid containment requirements sufficiently prohibit any uncontrolled release of fluids to the environment. Furthermore, the Department is requiring applicants to submit information on hydraulic fracturing fluid composition prior to well permit issuance. The Public Officer's Law and the Department's Records Access Regulations provide a methodology to handle any information submitted by applicants and operators that is claimed to be trade secret or confidential commercial information. Neither the fact that a formula may be considered proprietary, nor that the fact that EPCRA does not apply to the oil and gas extraction sector, prevents the Department from requiring that the information be submitted.

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