US energy sector concerned on fate of hydraulic fracturing

10 September 2010 19:55  [Source: ICIS news]

WASHINGTON (ICIS)--US energy industry officials on Friday expressed concern that pressure from environmental groups and public misunderstandings may threaten the future of hydraulic fracturing as a crucial technology in shale gas development.

Officials with the American Petroleum Institute (API) said that long experience with hydraulic fracturing - known in the industry as fracking - and testing by federal and state agencies have failed to establish any link between that drilling technique and contamination of drinking water resources.

The institute called a press conference in advance of next week’s public hearings by the Environmental Protection Agency (EPA) at Binghamton, New York, about public concerns regarding chemicals used in fracking and their potential impact on water supplies.eas

The agency also has issued a request to nine major US natural gas drilling service companies, asking them to voluntarily provide information on the chemical composition of fluids used in fracking. The EPA said that if the firms did not provide the information voluntarily, the agency would use its authority to compel disclosure.

New York state government has imposed a one-year moratorium on shale gas development, and environmental groups such as the Sierra Club contend that fracking is not sufficiently regulated and should be controlled by the EPA under the US Safe Water Drinking Act.

A bill pending in the US Congress would put hydraulic fracturing under EPA control. The process is now regulated by state governments and has been for nearly 60 years.

The public hearings in New York and the EPA request for fracking chemical details are part of its planned two-year study of the drilling process that could lead to federal regulation of the technique.

Citing the New York state moratorium and new concerns about oil and gas drilling as a consequence of the BP oil spill in the Gulf of Mexico, API senior economist Sara Banaszak told reporters that there is increasing pressure on the fracking issue.

“But I would hope, and we see some signs, that we haven’t departed from reality when we look at our energy mix,” she told the press conference. “We do need to expand renewables and increase our energy efficiency, but wind and solar only provide 1% of our energy supply and there is still a lot of need for both oil and gas as part of our energy reality.”

New York is one of three states, including West Virginia and Pennsylvania, whose territories cover the Marcellus shale gas play, one of more than a dozen major shale gas resources across the US.

Stephanie Meadows, API senior policy advisor, said that part of the problem facing fracking in New York state and other areas of the eastern US is public misunderstanding.

“What we see in the Marcellus area is that fracturing is not a technology that has a history of use in the eastern side of the country, so there is a certain level of concern from the population there that is not familiar with the gas industry as are people in the US west,” Meadows said.

“Marcellus is getting more attention, and local homeowners are concerned,” she said.

Banaszak noted that hydraulic fracturing would be involved in almost 80% of all US domestic oil and gas wells to be drilled going forward, and fracking-dependent development of vast US shale gas resources was expected to account for nearly half of the country’s natural gas resources in years ahead.

She said the API expected the EPA’s request for detailed information on chemicals used in the fracking process and expects to see further EPA discovery efforts to inform the two-year study that is due by the end of 2012.

But she said the API remains opposed to efforts by some in Congress to put hydraulic fracturing under the control of the EPA.

“Our position, as we have stated over and over, is that there is no need for another layer of federal oversight,” she said. “States already regulate fracking and have been successfully doing so for 60 years, so it is questionable what value additional federal regulations would bring to what the states are already doing.”

The US petrochemicals industry, downstream chemical makers and a wide range of other manufacturing sectors are heavily dependent on natural gas as a feedstock, energy source or both.

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