Hydraulic Fracturing: Selected Legal Issues
Adam Vann
Legislative Attorney
Brandon J. Murrill
Legislative Attorney
Mary Tiemann
Specialist in Environmental Policy
November 15, 2013September 26, 2014
Congressional Research Service
7-5700
www.crs.gov
R43152
Hydraulic Fracturing: Selected Legal Issues
Summary
Hydraulic fracturing is a technique used to recover oil and natural gas from underground low
permeability rock formations. Its use along with horizontal drilling has been responsible for an
increase in estimated U.S. oil and natural gas reserves. Hydraulic fracturing and related oil and
gas production activities have been controversial because of their potential effects on public
health and the environment. Several environmental statutes have implications for the regulation
of hydraulic fracturing by the federal government and states.
An amendment to the Safe Drinking Water Act (SDWA) passed as a part of the Energy Policy Act
of 2005 (EPAct 2005) clarified that the Underground Injection Control (UIC) requirements found
in the SDWA do not apply to hydraulic fracturing, although the exclusion does not extend to the
use of diesel fuel in hydraulic fracturing operations. The underground injection of wastewater
generated during oil and gas production (including hydraulic fracturing) does require a UIC
permit under the SDWA, as do injections for enhanced oil and gas recovery operations. Under the
Clean Water Act (CWA), parties seeking to discharge produced water may have to apply for a
permit under the National Pollutant Discharge Elimination System. Under the Clean Air Act
(CAA), the Environmental Protection Agency (EPA) has issued new rules covering emissions of
volatile organic compounds from hydraulic fracturing operations.
Provisions of the Resource Conservation and Recovery Act (RCRA) exempt drilling fluids,
produced waters, and other wastes associated with the exploration, development, or production of
crude oil, natural gas, or geothermal energy from regulation as hazardous wastes under Subtitle C
of RCRA. However, these wastes are subject to other federal laws (such as the SDWA and the
CWA), as well as to state requirements. Facility owners and operators and other potentially
responsible parties could potentially face liability under the Comprehensive Environmental
Response, Compensation, and Liability Act (CERCLA) for cleanup costs, natural resource
damages, and the costs of federal public health studies, if hydraulic fracturing results in the
release of hazardous substances at or under the surface in a manner that may endanger public
health or the environment.
The National Environmental Policy Act (NEPA) requires federal agencies to consider the
environmental impacts of proposed federal actions before proceeding with them. An agency
would be obligated to consider the impacts of an action that involves hydraulic fracturing if that
action takes place on federal lands or when there is otherwise a sufficient federal nexus to
hydraulic fracturing.
Under the Emergency Planning and Community Right-to-Know Act (EPCRA), owners or
operators of facilities where certain hazardous hydraulic fracturing chemicals are present above
certain thresholds may have to comply with emergency planning requirements; emergency release
notification obligations; and hazardous chemical storage reporting requirements. In August 2011,
environmental groups petitioned EPA to promulgate rules under Section 4 and Section 8 of the
the Toxic Substances Control Act
(TSCA) for chemical substances and mixtures used in oil and gas
exploration or production.
HydraulicAt the state level, hydraulic fracturing tort litigation has raised questions about causation; whether hydraulic
hydraulic fracturing is an abnormally dangerous activity; and whether hydraulic fracturing may
constitute a
subsurface trespass to land. subsurface trespass to land. Also, several municipalities have attempted to ban
hydraulic fracturing through zoning restrictions and other local laws, creating potential conflicts
with oil and gas industry regulation at the state level.
Congressional Research Service
Hydraulic Fracturing: Selected Legal Issues
Contents
Introduction...................................................................................................................................... 1
The Safe Drinking Water Act and the Federal Role in Regulation of Underground
Injection ........................................................................................................................................ 1
Review of Relevant SDWA UIC Provisions.............................................................................. 1
The Debate over Regulation of Hydraulic Fracturing Under the SDWA ........................................ 3
The LEAF Challenge to the Alabama UIC Program and EPA’s Interpretation of the
SDWA..................................................................................................................................... 3
Energy Policy Act of 2005: A Legislative Exemption for Hydraulic Fracturing ............................. 5
EPA Guidance on SDWA Regulation offor Permitting Hydraulic Fracturing Using Diesel Fuels .................................. 6
Clean Water Act ............................................................................................................................... 7
Clean Air Act ................................................................................................................................... 8
Resource Conservation and Recovery Act....................................................................................... 9
The Bentsen Amendment and EPA’s 1988 Regulatory Determination .................................... 10
Natural Resources Defense Council Petition to Regulate E&P Wastes Under Subtitle
C ........................................................................................................................................... 11
Comprehensive Environmental Response, Compensation, and Liability Act ............................... 12
Petroleum and Natural Gas Exclusion ..................................................................................... 13
Exemption for Federally Permitted Releases .......................................................................... 13
Examples of Application of CERCLA Response Authority .................................................... 14
National Environmental Policy Act ............................................................................................... 15
Drilling in the Monterey Shale: Federal Oil and Gas Leases .................................................. 16
Delaware River Basin Commission: Proposed Regulations on Natural Gas
Development ........................................................................................................................ 17
USDA Rural Development Agency: Mortgages on Properties with Drilling Leases .............. 19
The Debate over Public Disclosure of the Chemical Composition of
Hydraulic Fracturing Fluids........................................................................................................ 2019
Toxic Substances Control Act ........................................................................................................ 2120
Occupational Safety and Health Act .............................................................................................. 2322
Emergency Planning and Community Right-to-Know Act ........................................................... 2423
Emergency Release Notification and
Hazardous Chemical Storage Reporting Requirements ....................................................... 2423
Earthworks Petitioners’ Request for the Oil and Gas Extraction Industry
to Report Under the Toxics Release Inventory ..................................................................... 2625
State Preemption of Municipal Land Use and Zoning Powers ...................................................... 2726
State Tort Law Court Cases ..................................................................................................................... 27
Alternatives to Preemption ...................................................................................................... 29
Pending Legislation State Tort Law ................................................................................................................................ 29
Legislation in the 113th Congress ................................................................................................... 31
Conclusion ..................................................................................................................................... 3433
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Contacts
Author Contact Information........................................................................................................... 35
34
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Hydraulic Fracturing: Selected Legal Issues
Introduction
Hydraulic fracturing is a technique used to recover oil and natural gas from underground low
permeability rock formations.1 Hydraulic fracturing involves pumping fluids (primarily water and
a small portion of chemicals, along with sand or other proppant) under high pressure into rock
formations to crack them and allow the resources inside to flow to a production well.2 The
technique has been the subject of controversy because of the potential effects that hydraulic
fracturing and related oil and gas production activities may have on the environment and health.
This report focuses on selected legal issues related to the use of hydraulic fracturing. It examines
some of the requirements for hydraulic fracturing contained in major federal environmental laws.3
It also provides an overview of issues involving state preemption of local zoning authority, as
well as state tort law.
The Safe Drinking Water Act and the Federal Role
in Regulation of Underground Injection
Review of Relevant SDWA UIC Provisions4
The Safe Drinking Water Act (SDWA), among other things, directs EPA to regulate the
underground injection of fluids (including solids, liquids, and gases) to protect underground
sources of drinking water.5 Part C of the SDWA establishes the national regulatory program for
the protection of underground sources of drinking water, including the oversight and limitation of
underground injections that could affect aquifers, through the establishment of underground
injection control regulations. Section 1421 of the SDWA directs the EPA Administrator to
promulgate regulations for state underground injection control (UIC) programs, and mandates
that the EPA regulations “contain minimum requirements for programs to prevent underground
injection that endangers drinking water sources.” Section 1421(b)(2) specifies that EPA
may not prescribe requirements for state UIC programs which interfere with or impede—(A)
the underground injection of brine or other fluids which are brought to the surface in
1
Department of Energy, Modern Shale Gas Development in the United States: A Primer, ES-4 (2009), available at
http://www.netl.doe.gov/technologies/oil-gas/publications/epreports/shale_gas_primer_2009energy.gov/sites/prod/files/2013/03/f0/ShaleGasPrimer_Online_4-2009.pdf.
2
Id. Hydraulic fracturing often is referred to as “fracing” within the industry and as “fracking” by others.
3
This report does not provide an overview of additional requirements that may apply on federal lands. The report also
does not address in detail tribal, state, or local requirements pertaining to the use of hydraulic fracturing. For an
overview of selected state and federal regulatory actions, including the Bureau of Land Management (BLM) proposed
hydraulic fracturing rule, see CRS Report R43148, An Overview of Unconventional Oil and Natural Gas: Resources
and Federal Actions, by Michael Ratner and Mary Tiemann.
4
This brief review of relevant sections of Part C of the SDWA is intended to provide the necessary background for
discussion of legal issues associated with regulation of hydraulic fracturing under the act. For further discussion of the
SDWA generally, see CRS Report RL31243, Safe Drinking Water Act (SDWA): A Summary of the Act and Its Major
Requirements, by Mary Tiemann. For a more detailed review of Part C of the SDWA, UIC program, and its application
to hydraulic fracturing and related activities, see CRS Report R41760, Hydraulic Fracturing and Safe Drinking Water
Act Regulatory Issues, by Mary Tiemann and Adam Vann.
5
42 U.S.C. §§300h-300h-5.
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connection with oil or natural gas production or natural gas storage operations, or (B) any
underground injection for the secondary or tertiary recovery of oil or natural gas, unless such
requirements are essential to assure that underground sources of drinking water will not be
endangered by such injection.6
As noted, Section 1421 of the SDWA states that UIC regulations must “contain minimum
requirements for effective programs to prevent underground injection which endangers drinking
water sources.”7 Known as the “endangerment standard,” this statutory standard is a major
driving force in EPA regulation of underground injection. This endangerment language focuses on
protecting groundwater that is used or may be used to supply public water systems. This focus
parallels the general scope of the statute, which addresses the quality of water provided by public
water systems and does not address private, residential wells. The endangerment language has
raised questions as to whether EPA regulations can reach underground injection activities to
protect groundwater that is not used by public water systems.
The SDWA directs EPA to protect against endangerment of an “underground source of drinking
water” (USDW). The regulations define a USDW to mean an aquifer or part of an aquifer that
either
•
supplies a public water system; or
•
contains a sufficient quantity of groundwater to supply a public water system;
and
•
currently supplies drinking water for human consumption; or
•
contains fewer than 10,000 milligrams per liter (mg/L) total dissolved solids; and
•
is not an “exempted aquifer.”8
To implement the UIC program as mandated by the provisions of the SDWA described above,
EPA has established six classes of underground injection wells based on categories of materials
that are injected into the ground by each class. In addition to the similarity of fluids injected in
each class of wells, each class shares similar construction, injection depth, design, and operating
techniques. The wells within a class are required to meet a set of appropriate performance criteria
for protecting underground sources of drinking water. Class II wells feature the injection of brines
and other fluids associated with oil and gas production, and hydrocarbons for storage. The wells
inject fluids beneath the lowermost USDW. If hydraulic fracturing were to be regulated under the
SDWA, it is likely that most hydraulic fracturing operations would be characterized as Class II
wells.
Under the SDWA, states may take on primary responsibility for administration and enforcement.
Section 1422 of the SDWA authorizes EPA to delegate primary enforcement authority for UIC
6
42 U.S.C. §300h(b)(2) (emphasis added).
42 U.S.C. §300h(b)(1).
8
40 C.F.R. §144.3. According to EPA regulations, an exempted aquifer is an aquifer, or a portion of an aquifer, that
meets the criteria for a USDW, for which protection has been waived under the UIC program. Under 40 C.F.R. Part
146.4, an aquifer may be exempted if it is not currently being used—and will not be used in the future—as a drinking
water source, or it is not reasonably expected to supply a public water system due to a high total dissolved solids
content. The SDWA does not mention aquifer exemption, but EPA explains that without aquifer exemptions, certain
types of energy production, mining, or waste disposal into USDWs would be prohibited. EPA, typically at the Region
level, makes the final determination on granting all exemptions.
7
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programs to the states, provided that the state program meets EPA requirements promulgated
under Section 1421 and prohibits any underground injection that is not authorized by a state
permit or rule.9 If a state’s UIC program plan is not approved, or the state has chosen not to
assume program responsibility, then EPA must implement the UIC program in that state.
Alternatively, Section 1425 authorizes EPA to approve the portion of a state’s UIC program that
relates to “any underground injection for the secondary or tertiary recovery of oil or natural gas”
if the state program meets certain requirements of Section 1421 and represents an effective
program to prevent underground injection which endangers drinking water sources.10 Under this
provision, states may demonstrate to EPA that their existing programs for oil and gas injection
wells are effective in preventing endangerment of underground sources of drinking water. This
provides states with an alternative to meeting the specific requirements contained in EPA
regulations promulgated under Section 1421.
The Debate over Regulation of Hydraulic Fracturing
Under the SDWA
From the date of the SDWA’s enactment in 1974 until the late 1990s, hydraulic fracturing was not
regulated under the act by either EPA or any of the states who had chosen to take on
responsibility for administration of the SDWA. However, in the last 15 years a number of
developments called into question the extent to which hydraulic fracturing would be considered
an “underground injection” to be regulated under the SDWA. One trigger for this debate was a
challenge to the Alabama UIC program brought by the Legal Environmental Assistance
Foundation (LEAF).
The LEAF Challenge to the Alabama UIC Program
and EPA’s Interpretation of the SDWA
In 1994, LEAF petitioned EPA to initiate proceedings to have the agency withdraw its approval of
the Alabama UIC program because the program did not regulate hydraulic fracturing operations
in the state associated with production of methane gas from coalbed formations.11 The state of
Alabama had previously been authorized by EPA to administer a UIC program pursuant to the
terms of the SDWA.12 EPA denied the LEAF petition in 1995 based on a finding that hydraulic
fracturing did not fall within the definition of “underground injection” as the term was used in the
SDWA and the EPA regulations promulgated under that act.13 According to EPA, that term
applied only to wells whose “principal function” was the placement of fluids underground.14
LEAF challenged EPA’s denial of its petition in the U.S. Court of Appeals for the Eleventh
9
42 U.S.C. §300h-1. The minimum requirements for a state UIC program can be found at 40 C.F.R. Part 145.
Id. at §300h-4.
11
Legal Environmental Assistance Foundation, Inc. v. U.S. Environmental Protection Agency, 118 F.3d 1467, 1471
(11th Cir. 1997) (“LEAF I”).
12
Id. at 1470.
13
Id. at 1471.
14
Id.
10
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Circuit, arguing that EPA’s interpretation of the terms in question was inconsistent with the
language of the SDWA.15
The court rejected EPA’s claim that the language of the SDWA allowed it to regulate only those
wells whose “principal function” was the injection of fluids into the ground. EPA based this claim
on what it perceived as “ambiguity” in the SDWA regarding the definition of “underground
injection” as well as a perceived congressional intent to exclude wells with primarily noninjection functions.16 The court held that there was no ambiguity in the SDWA’s definition of
“underground injection” as “the subsurface emplacement of fluids by well injection,” noting that
the words have a clear meaning and that
The process of hydraulic fracturing obviously falls within this definition, as it involves the
subsurface emplacement of fluids by forcing them into cracks in the ground through a well.
Nothing in the statutory definition suggests that EPA has the authority to exclude from the
reach of the regulations an activity (i.e. hydraulic fracturing) which unquestionably falls
within the plain meaning of the definition, on the basis that the well that is used to achieve
that activity is also used—even primarily used—for another activity (i.e. methane gas
production) that does not constitute underground injection.17
The court therefore remanded the decision to EPA for reconsideration of LEAF’s petition for
withdrawal of Alabama’s UIC program approval.18
Following the LEAF I decision, in 1999 Alabama submitted a revised UIC program to EPA.19
Alabama sought approval for the revised UIC program under Section 1425 of the SDWA rather
than Section 1422(b). As mentioned above, Section 1425 differs from Section 1422(b) in that
approval under Section 1425 is based on a showing by the state that the program meets the
generic requirements found in Section 1421(b)(1)(A)-(D) of the SDWA and that the program
“represents an effective program (including adequate recordkeeping and reporting) to prevent
underground injection which endangers drinking water sources.” In contrast, approval of a state
program under Section 1422(b) requires a showing that the state’s program satisfies the
requirements of the UIC regulations promulgated by EPA.20
EPA approved Alabama’s revised UIC program in 2000,21 and LEAF appealed EPA’s decision to
approve to the U.S. Court of Appeals for the Eleventh Circuit.22 In its challenge, LEAF made
three arguments. First, LEAF claimed that EPA should not have approved state regulation of
hydraulic fracturing under Section 1425 of the SDWA because it does not “relate to ...
underground injection for the secondary or tertiary recovery of oil or natural gas,” one of the
requirements for approval under Section 1425.23 The court rejected this argument, finding that the
15
Id. at 1472.
Id. at 1473-74.
17
Id. at 1474-75.
18
Id. at 1478.
19
See 64 Fed. Reg. 56986 (October 22, 1999).
20
Id. at §300h-1(b)(1)(A).
21
65 Fed. Reg. 2889 (October 2000).
22
Legal Environmental Assistance Foundation, Inc. v. U.S. Environmental Protection Agency, 276 F.3d 1253, 1257
(11th Cir. 2001).
23
Id. at 1256.
16
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phrase “relates to” was broad and ambiguous enough to include regulation of hydraulic fracturing
as being related to secondary or tertiary recovery of oil or natural gas.24
Second, LEAF challenged the Alabama program’s regulation of hydraulic fracturing as “Class IIlike” wells not subject to the same regulatory requirements as Class II wells.25 The court agreed
with LEAF on this point, noting that in its decision in LEAF I, it had held that methane gas
production wells used for hydraulic fracturing are “wells” within the meaning of the statute.26 As
a result, the court found that wells used for hydraulic fracturing must fall under one of the five
classes set forth in the EPA regulations at 40 C.F.R. Section 144.6.27 Specifically, the court found
that the injection of hydraulic fracturing fluids for recovery of coalbed methane “fit squarely
within the definition of Class II wells,” and as a result the court remanded the matter to EPA for a
determination of whether Alabama’s updated UIC program complied with the requirements for
Class II wells.28
Finally, LEAF alleged that even if Alabama’s revised UIC program was eligible for approval
under Section 1425 of the SDWA, EPA’s decision to approve it was “arbitrary and capricious”
and therefore a violation of the Administrative Procedure Act.29 The court rejected this
argument.30
Energy Policy Act of 2005: A Legislative Exemption
for Hydraulic Fracturing
The decision by the U.S. Court of Appeals for the Eleventh Circuit in LEAF I highlighted a
debate over whether the SDWA, as it read at the time, required EPA to regulate hydraulic
fracturing. Although the Eleventh Circuit’s decision applied only to hydraulic fracturing for
coalbed methane production in Alabama, the court’s reasoning—in particular, its finding that
hydraulic fracturing “unquestionably falls within the plain meaning of the definition [of
underground injection]”31—raised the issue of whether EPA could be required to regulate
hydraulic fracturing generally under the SDWA.
Before this question was resolved through agency action or litigation, Congress passed an
amendment to the SDWA as a part of the Energy Policy Act of 2005 (EPAct 2005; P.L. 109-58)
that addressed this issue. Section 322 of EPAct 2005 amended the definition of “underground
injection” in the SDWA as follows:
The term “underground injection”—(A) means the subsurface emplacement of fluids by
well injection; and (B) excludes—(i) the underground injection of natural gas for purposes of
storage; and (ii) the underground injection of fluids or propping agents (other than diesel
24
Id. at 1259-61.
Id. at 1256.
26
Id. at 1262.
27
Id. at 1263.
28
Id. at 1263-64.
29
Id. at 1256 (referring to 5 U.S.C. §706(2)(A)).
30
Id. at 1265.
31
LEAF I, 118 F.3d at 1475.
25
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fuels) pursuant to hydraulic fracturing operations related to oil, gas, or geothermal
production activities.
This amendment clarified that the UIC requirements found in the SDWA do not apply to
hydraulic fracturing, although the exclusion does not extend to the use of diesel fuel in hydraulic
fracturing operations. This amended language is the definition of “underground injection” found
in the SDWA as of the date of this report.
EPA Guidance on SDWA Regulation offor Permitting Hydraulic Fracturing
Using Diesel
Fuels
As noted above, the 2005 amendment to the definition of “underground injection” in the SDWA
excluded injections as part of hydraulic fracturing operations, but such injections involving the
use of diesel fuels were not made part of the exclusion, meaning that injections for purposes of
hydraulic fracturing involving the use of diesel fuel might still be made subject to regulation
under the SDWA. It was not clear to states or the regulated community how EPA would address
the EPAct 2005 amendment, and for several years EPA took no official position regarding the
regulation of hydraulic fracturing using diesel fuel under the SDWA.32 In May of 2012, EPA
issued draft UIC program permitting guidance for hydraulic fracturing injection activities where
diesel fuels are used in fluids or propping agents.33 The proposed guidance is intended for EPA
permit writers and is relevant where EPA directly implements the UIC Class II program.
In the proposed guidance, EPA states its interpretation that “oil and gas hydraulic fracturing
operations using diesel fuels as a fracturing fluid, or as a component of a fracturing fluid ... are
subject to UIC Class II permitting requirements.”34 As described earlier in this report, injections
In February 2014, EPA issued final diesel permitting guidance, which states that “under the 2005
amendments to the SDWA, a UIC Class II permit must be obtained prior to conducting the
underground injection of diesel fuels for hydraulic fracturing.”33 As described earlier in this
report, injections subject to UIC Class II requirements must comply with a number of regulatory
requirements.
These include permitting requirements, and testing and monitoring obligations with
respect to the
well. If this proposed guidance is adopted as “final,” EPA UIC program administrators would be
expected to apply it going forward in their permitting of Class II wells. EPA noted in the proposed
guidance well.34 The guidance is intended for EPA permit writers and is relevant where EPA
directly implements the UIC Class II program. EPA notes that “[t]o the extent that states may
choose to follow some aspects of EPA guidance in
implementing their own programs, it may also
be relevant in areas where EPA is not the
permitting authority.”35
A key issue regards how EPA mayThere had been considerable debate regarding how EPA would define “diesel fuels” in the final
guidance. The draft guidance
recommends using six Chemical Abstracts Service Registry
Numbers (CASRNs) for determining
whether diesel fuels are used in hydraulic fracturing
operations.36 These six CASRNs collectively include various types of diesel fuels, home heating
32
32
In January 2011, an investigation led by Representatives Waxman, Markey and DeGette of the House Committee on
Energy and Commerce found that “oil and gas service companies have injected over 32 million gallons of diesel fuel or
hydraulic fracturing fluids containing diesel fuel in wells in 19 states between 2005 and 2009.”
http://democrats.energycommerce.house.gov/index.php?q=news/waxman-markey-and-degette-investigation-findscontinued-use-of-diesel-in-hydraulic-fracturing-f/.
33
U.S. Environmental Protection Agency,
33
Permitting Guidance for Oil and Gas Hydraulic Fracturing Activities Using
Diesel Fuels—Draft: Underground
Injection Control Program Guidance #84, 77 Fed. Reg. 27,451 (May 10, 2012). The draft describes how UIC Class II
requirements may be tailored to address the risks of diesel fuel injections. The comment period deadline is August 23,
2012.
34
Id.
35
Id. at 27,542.
36
EPA explains that “diesel fuels may be used in hydraulic fracturing operations as a primary base (or carrier) fluid, or
(continued...)
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include various types of diesel fuels, home heating oils, kerosene, crude oil, and a range of other
petroleum compounds.37 The draft also includes alternative descriptions of diesel that are broader
in scope. Also at issue is whether the final guidance will specify a de minimis amount of diesel
fuel content for hydraulic fracturing fluids; the draft guidance does not do so. EPA plans to
develop a final guidance document in 2013 Injection Control Program Guidance #84, EPA 816-R-14-001, February 2014, p. 1,
http://water.epa.gov/type/groundwater/uic/class2/hydraulicfracturing/hydraulic-fracturing.cfm.
34
40 C.F.R. §124 and §§144-147.
35
“Permitting Guidance for Oil and Gas Hydraulic Fracturing Activities Using Diesel Fuels—Draft,” 77 Fed. Reg.
27542.
36
EPA explains that “diesel fuels may be used in hydraulic fracturing operations as a primary base (or carrier) fluid, or
added to hydraulic fracturing fluids as a component of a chemical additive to adjust fluid properties (e.g., viscosity and
lubricity) or act as a solvent to aid in the delivery of gelling agents. Some chemicals of concern often occur in diesel
fuels as impurities or additives. Benzene, toluene, ethylbenzene, and xylene compounds (BTEX) are highly mobile in
ground water and are regulated under national primary drinking water regulations because of the risks they pose to
(continued...)
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oils, kerosene, crude oil, and a range of other petroleum compounds.37 Also at issue was whether
the final guidance would specify a de minimis amount of diesel fuel content for hydraulic
fracturing fluids; the draft guidance did not do so. The final document covers five of the six
proposed CASRNs (no longer including crude oil), and does not establish a de minimis
concentration of “diesel” in fracturing fluid that would be exempt from permitting requirements.
Clean Water Act
Hydraulic fracturing is a water-intensive practice. After a well is hydraulically fractured, a
substantial portion of the injected frac fluid returns to the surface as “flowback.” This flowback
typically contains proppant (sand) and chemical residues from the frac fluid, as well as salts,
metals, and potentially significant amounts of naturally occurring radioactive materials (NORM)
that may be present in the water produced from the geologic formations.38 Additionally, oil and
gas wells generally continue to produce formation water throughout their production lives.
Flowback water and production brine that are not reused will require proper disposal, either
through underground injection or treatment and surface discharge.
Often this flowback is injected into wells for disposal. However, if underground injection is not
feasible or not employed for other reasons, the well service company may not discharge the
flowback and other produced water into surface waters (e.g., lakes or streams) unless this is done
in compliance with the Clean Water Act (CWA).39 Section 301(a) of the CWA prohibits “the
discharge of any pollutant” into “navigable waters” except as permitted pursuant to other sections
of the CWA.40 Parties seeking to discharge flowback and other produced water would likely apply
for a permit under the National Pollutant Discharge Elimination System (NPDES) as authorized
under Section 402 of the CWA.41 NPDES permits allow for discharges to navigable waters that
would otherwise be prohibited by Section 301(a) of the CWA subject to certain limits based on
both the technology available to control the pollutants (i.e., technology-based effluent limits) and
limits that are protective of the water quality standards of the receiving water (i.e., water-qualitybased effluent limits).42
(...continued)
added to hydraulic fracturing fluids as a component of a chemical additive to adjust fluid properties (e.g., viscosity and
lubricity) or act as a solvent to aid in the delivery of gelling agents. Some chemicals of concern often occur in diesel
fuels as impurities or additives. Benzene, toluene, ethylbenzene, and xylene compounds (BTEX) are highly mobile in
ground water and are regulated under national primary drinking water regulations because of the risks they pose toRather than dealing with disposal of flowback on their own by obtaining and complying with a
NPDES permit, drilling companies may opt to transfer the wastewater to publicly owned
(...continued)
human health.” Source: FACT SHEET: Underground Injection Control (UIC) Program Permitting Guidance for Oil
and Gas Hydraulic Fracturing Activities Using Diesel Fuels, UIC Program Guidance #84 – —Draft, EPA 816-K-12-001.
37
Id. at 27,45377 Fed. Reg. 27453. EPA explains that these CASRNs were selected “because either their primary name, or their common
common synonyms contained the term ‘“diesel fuel’” and they meet the chemical and physical properties of ‘“diesel fuel’ as
”
as provided in the Toxic Substances Control Act (TSCA) Inventory.”
38
See, for example, E.L. Rowan, M.A. Kirby, and C.S. Kirby et al., Radium Content of Oil- and Gas-Field Produced
Waters in the Northern Appalachian Basin—Summary and Discussion of Data, U.S Geological Survey, USGS
Scientific Investigations Report 2011-5135, 2011, 31 p., available at http://energy.usgs.gov/HealthEnvironment/
EnergyProductionUse/ProducedWaters.aspx.
39
33 U.S.C. §1251 et seq.
40
33 U.S.C. §1311(a).
41
33 U.S.C. §1342(a). Note that EPA usually delegates its NPDES permitting authority to states who choose to assume
responsibility for the program under 33 U.S.C. §1342(b).
42
33 U.S.C. §1311; 40 CFR C.F.R. §125.3(a). The technology-based requirements for direct discharges from oil and gas
(continued...)
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Rather than dealing with disposal of flowback on their own by obtaining and complying with a
NPDES permit, drilling companies may opt to transfer the wastewater to publicly owned
extraction facilities into surface waters are found in 40 Code of Federal Regulations (C.F.R.) Part 435.
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treatment works (POTW) that discharge to navigable waters. There are some pretreatment
requirements for wastewater introduced to a POTW including prohibiting introduction of wastes
that interfere with, pass through, or are otherwise incompatible with POTW operations.43 Because
of the salinity of oil and gas production wastewater, discharge to POTWs generally is not
available, as most municipal POTWs are not designed and engineered to handle the high levels of
total dissolved solids (TDS), fracturing fluid additives, metals, and NORMs in the wastewater. To
minimize the need for wastewater disposal, many companies are employing on-site treatment
technologies to reuse or recycle a portion of the flowback and produced water.
Clean Air Act
As this report has explained, the definition of “underground injection” found in the SDWA
prevents regulation of hydraulic fracturing pursuant to that statute unless the fracking fluid
contains diesel fuel. However, other federal environmental statutes do not contain similar
reservations of jurisdiction, and EPA has sought to regulate certain environmental impacts of
hydraulic fracturing pursuant to these statutes. One such avenue is regulation of emissions
associated with the hydraulic fracturing process via the Clean Air Act (CAA). On August 16,
2012, EPA issued new regulations covering, among other things, emissions of volatile organic
compounds (VOCs) from hydraulic fracturing operations.
The impetus for the new regulations was a legal challenge filed by environmental organizations.
In 2009, WildEarth Guardians and the San Juan Citizens Alliance filed a petition in the U.S.
District Court for the District of Columbia alleging that EPA had failed to review and revise its
New Source Performance Standards (NSPSs) for oil and gas operations every eight years as
required by Section 111(b)(1)(B) of the CAA.44 Specifically, the environmental groups alleged
that EPA had failed to update existing standards and adopt new standards for emissions from oil
and natural gas production as well as natural gas transmission and storage.
The challenge and subsequent settlement triggered a new rulemaking by EPA in which it not only
updated existing standards for certain natural gas processing plants and other facilities, but also
established new standards for emissions from certain types of natural gas operations not covered
at all in the existing standards.45 Among the new standards were requirements applicable to new
hydraulicallyhydraulic fracturing operations as well as refracturing operations.
The new regulations direct the industry to adopt a process known as “green completions” or
“reduced emissions completions” for hydraulically fractured gas wells. (Hydraulically fractured
oil wells are exempt from the 2012 NSPS requirements.) In a “green completion,” the natural gas
that would otherwise be vented during the completion process is cleaned and captured for reuse in
(...continued)
extraction facilities into surface waters are found in 40 Code of Federal Regulations (CFR) Part 435.
43
33 U.S.C. §1317(b)(1); 40 C.F.R. Part 403.
44
another process that does not involve direct release into the atmosphere.46 In order to allow the
industry time to make the needed changes, the rulemaking established two phases for compliance.
During Phase 1, which lasts from the effective date of the rulemaking (October 15, 2012) until
43
33 U.S.C. §1317(b)(1); 40 C.F.R. Part 403.
42 U.S.C. §7411(b)(1)(B).
45
Oil and Natural Gas Sector: New Source Performance Standards and National Emission Standards for Hazardous Air
Pollutants Reviews, 77 Fed. Reg. 49,490 (August 16, 2012).
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another process that does not involve direct release into the atmosphere.46 In order to allow the
industry time to make the needed changes, the rulemaking established two phases for compliance.
During Phase 1, which lasts from the effective date of the rulemaking (October 15, 2012) until
46
For a more detailed explanation of the “green completion” technique, see CRS Report R42833, Air Quality Issues in
Natural Gas Systems, by Richard K. Lattanzio.
44
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January 1, 2015, industry must reduce VOC emissions at new hydraulic fracturing sites either by
using a “completion combustion device” in a technique commonly referred to as “flaring,”47 or by
employing the green completion process.48 After January 1, 2015, all hydraulically fractured wells
must employ green completion.49 These requirements apply both to new hydraulic fracturing
operations and to refracturing of existing wells.50 The regulations also establish reporting
requirements for owners and operators of hydraulically fractured and refractured wells prior to
the start of well completion.51
There are some exceptions in these regulations for certain types of wells. Exploratory or
“wildcat” drilling operations and “delineation wells” used to determine the borders of a reservoir,
and low-pressure wells do not need to employ green completions.52 The 2012 NSPS requires
operators of these types of wells to use completion combustion devices unless hazardous or
prohibited under state or local law or regulations.53
Resource Conservation and Recovery Act54
Federal and state authorities to regulate wastes are established under the Solid Waste Disposal Act
of 1965, as amended by the Resource Conservation and Recovery Act of 1976 (RCRA).55 Subtitle
C of RCRA established a framework for EPA, or authorized states, to regulate waste identified as
“hazardous.”56 Specifically, EPA was required to develop criteria necessary to identify hazardous
wastes and to promulgate regulations applicable to hazardous waste generators and transporters
and to facilities that treat, store, and dispose of such wastes.57 EPA has primary authority to
implement the federal hazardous waste program,58 but was required to develop procedures for
states to become authorized to implement that program.59 Most states have chosen to do so.60
46
For a more detailed explanation of the “green completion” technique, see CRS Report R42833, Air Quality Issues in
Natural Gas Systems, by Richard K. Lattanzio.
47
Under RCRA Subtitle D, state and local governments were established as the primary planning,
regulating, and implementing entities responsible for managing non-hazardous solid waste,
including waste explicitly exempt from regulation under Subtitle C. EPA’s primary role under
Subtitle D is to provide state and local agencies with information, guidance, and policy.61
47
This process burns off the gas that would otherwise escape during the well completion process.
48
77 Fed. Reg. at 49,499.
49
Id.
50
Id.
51
Id.
52
Id.
53
Id.
54
Linda Luther, Analyst in Environmental Policy, Resources, Science, and Industry Division, contributed to the
preparation of this section of the report.
55
The 1976 amendments to the Solid Waste Disposal Act were so comprehensive that the law is more commonly
referred to as RCRA.
56
42 U.S.C. §§6921-29; H.Rept. 94-1491 (1976), at 5-7.
57
42 U.S.C. §§6921-25.
58
42 U.S.C. §§6927-28.
59
42 U.S.C. §§6926, 6929.
60
See EPA’s “RCRA State Authorization” web page at http://www.epa.gov/osw/laws-regs/state/index.htm.
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Under RCRA Subtitle D, state and local governments were established as the primary planning,
regulating, and implementing entities responsible for managing non-hazardous solid waste,
including waste explicitly exempt from regulation under Subtitle C. EPA’s primary role under
Subtitle D is to provide state and local agencies with information, guidance, and policy.61
61
42 U.S.C. §§6907 and 6941.
48
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The Bentsen Amendment and EPA’s
1988 Regulatory Determination
The Solid Waste Disposal Act Amendments of 1980 (P.L. 96-482) included amendments to
Subtitle C requirements regarding the identification of hazardous waste.62 Provisions commonly
referred to as the “Bentsen” amendment temporarily excluded “drilling fluids, produced waters,
and other wastes associated with the exploration, development, or production of crude oil, natural
gas, or geothermal energy” (E&P wastes) from regulation as hazardous wastes under Subtitle C of
RCRA.63 The exemption was motivated in part by a concern about the economic impact that
comprehensive regulation of E&P wastes under Subtitle C would have on the oil and gas
industry.64 The Bentsen amendment required EPA to conduct a study of E&P waste and submit its
findings to Congress.65 If EPA determined that E&P wastes warranted regulation under Subtitle C,
the agency was required to submit proposed regulations to both houses of Congress. Those
regulations could “take effect only when authorized by Act of Congress.”66
In its 1987 report to Congress,67 EPA found, in part, that existing state and federal regulations
were generally adequate to regulate E&P wastes, although there were regulatory gaps in certain
states. EPA further found that regulating E&P wastes under RCRA Subtitle C would have a
substantial impact on the U.S. economy and would be unnecessary and impracticable. In its 1988
regulatory determination,68 EPA determined that the management of E&P wastes under Subtitle C
was not warranted, but that the agency would pursue the following three-pronged approach to
addressing adverse effects of the waste: improve existing federal regulatory programs under
RCRA Subtitle D and augment the Safe Drinking Water Act and/or Clean Water Act
requirements; work with states to improve their waste management programs; and work with
Congress on any additional legislation that might be needed.69
In the 25 years since EPA made its regulatory determination, the agency has chosen not to
develop regulations under RCRA Subtitle D or pursue additional RCRA legislation. EPA clarified
the Subtitle C exemption.70 In 2002, EPA issued guidance regarding the scope of the exemption,
61
42 U.S.C. §§6907 and 6941.
42 U.S.C. §6921.
63
including examples of exempt and non-exempt E&P wastes.71 EPA listed produced water and
drilling fluids as exempt wastes; and unused fracturing fluids or acids as non-exempt waste.72
62
42 U.S.C. §6921.
Solid Waste Disposal Act Amendments of 1980, P.L. 96-482, §7, 42 U.S.C. §6921(b)(2)(A).
64
S.Rept. 96-172, at 6 (1979).
65
The study criteria are specified at 42 U.S.C. §6982(m).
66
42 U.S.C. §6921(b)(2)(C).
67
EPA, Report to Congress: Management of Wastes from the Exploration, Development, and Production of Crude Oil,
Natural Gas, and Geothermal Energy (December 1987), http://www.epa.gov/osw/nonhaz/industrial/special/oil/
530sw88003a.pdf.
68
Regulatory Determination for Oil and Gas and Geothermal Exploration, Development and Production Wastes, 53
Fed. Reg. 25446 (July 6, 1988).
69
Id.
70
See EPA’s “Clarification of the Regulatory Determination for Wastes From, the Exploration, Development and
(continued...)
62
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including examples of exempt and non-exempt E&P wastes.71 EPA listed produced water and
drilling fluids as exempt wastes; and unused fracturing fluids or acids as non-exempt waste.72
Production of Crude Oil, Natural Gas and Geothermal Energy,” 58 Fed. Reg. 15284 (March 22, 1993) and “Exemption
of Oil and Gas Exploration and Production Wastes from Federal Hazardous Waste Regulations” (October 2002), both
available at http://www.epa.gov/osw/nonhaz/industrial/special/oil/index.htm.
71
EPA October 2002 guidance, at pp. 10-11.
72
Id.
63
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That is, unused fracturing fluids may be subject to Subtitle C requirements if the fluid exhibits
characteristics that make a waste “hazardous” (e.g., exceed regulatory levels for toxicity).73
Depending on the chemicals in the drilling fluid and the geologic formations in which it is
injected, produced hydraulic fracturing fluids may contain hazardous constituents (e.g., heavy
metals).74 Regardless of whether those fluids exhibit the regulatory characteristics of hazardous
waste (e.g., exceed regulatory levels of toxicity), such fluids are exempt from federal Subtitle C
regulation. E&P waste disposal is, however, subject to state waste management requirements, as
well as requirements applicable to the disposal of liquid waste implemented under federal laws
other than RCRA (e.g., UIC Program requirements applicable to the injection of oil and gasrelated wastes into Class II wells).
Natural Resources Defense Council Petition to Regulate
E&P Wastes Under Subtitle C
In September 2010, the Natural Resources Defense Council (NRDC), an environmental advocacy
group, petitioned EPA to initiate a rulemaking under RCRA to regulate E&P wastes as hazardous
wastes under Subtitle C.75 In support of their petition, NRDC identified reports and data prepared
since 1988 that they assert “quantify the waste’s toxicity, threats to human health and the
environment, inadequate state regulatory programs, and readily available solutions.”76 In addition,
NRDC asserted that “both the oil and gas industry and the risks associated with E&P wastes have
expanded dramatically, making EPA’s 1988 Regulatory Determination unjustified.”77 The NRDC
sought to have EPA promulgate regulations that subject E&P wastes to Subtitle C to “ensure safe
management of these wastes throughout their life cycle from cradle to grave, including
generation, transportation, treatment, storage and disposal.”78
EPA has not yet formally responded to the NRDC petition. However, in 2011, EPA indicated that
in response to the petition, the Office of Solid Waste and Emergency Response was reviewing
(...continued)
Production of Crude Oil, Natural Gas and Geothermal Energy,” 58 Fed. Reg. 15284 (March 22, 1993) and “Exemption
of Oil and Gas Exploration and Production Wastes from Federal Hazardous Waste Regulations” (October 2002), both
available at http://www.epa.gov/osw/nonhaz/industrial/special/oil/index.htm.
71
EPA October 2002 guidance, at pp. 10-11.
72
Id.
73
incidents alleged by the petitioner; regulations in states with natural gas activities; and best
management practices for E&P wastes developed by industry, federal, and state associations.79
Based on its finding, EPA could possibly review and revise its 1988 regulatory determination.
73
A waste may be deemed hazardous based on reactive, ignitable, corrosive or toxic characteristics specified at 40
C.F.R. §261.20-.24.
74
Department of Energy, Modern Shale Gas Development in the United States: A Primer 66-71 (2009),
http://www.netl.doe.gov/technologies/oil-gas/publications/EPreports/Shale_Gas_Primer_2009energy.gov/sites/prod/files/2013/03/f0/ShaleGasPrimer_Online_4-2009.pdf.
75
Natural Resources Defense Council, Re: Petition for Rulemaking Pursuant to Section 6974(a) of the Resource
Conservation and Recovery Act Concerning the Regulation of Wastes Associated with the Exploration, Development,
or Production of Crude Oil or Natural Gas or Geothermal Energy 1 (Sept. 8, 2010) [hereinafter NRDC Petition],
http://docs.nrdc.org/energy/files/ene_10091301a.pdf. Section 7004(a) of RCRA permits “any person” to petition EPA
for promulgation of a regulation under RCRA. 42 U.S.C. §6974(a).
76
NRDC Petition at 1.
77
Id. at 5.
78
Id. at 4.
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incidents alleged by the petitioner; regulations in states with natural gas activities; and best
management practices for E&P wastes developed by industry, federal, and state associations.79
Based on its finding, EPA could possibly review and revise its 1988 regulatory determination.
79
See EPA Special Litigation and Projects Division presentation to the American State and Tribal Solid Waste
Management Organization on “EPA’s Energy Extraction Enforcement Initiative,” (October 2011), including
presentation materials for Sandra Connors, Deputy Director, EPA Office of Resource Conservation and Recovery on
“Exploration & Production Waste and RCRA,” p. 31, available at http://www.astswmo.org/Files/Meetings/2011/2011Annual/Presentations/EPA-Hydro-Fracturing.pdf.
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However, as discussed above, the Bentsen amendment specifies that, if EPA determined that
Subtitle C regulation was warranted, proposed regulations could not take effect until authorized
by act of Congress.80 Thus, if EPA were to review its 1988 regulatory determination and find that
regulation under Subtitle C is necessary, the agency could arguably promulgate such regulations,
but could not implement them unless explicitly authorized by Congress to do so.
Comprehensive Environmental Response,
Compensation, and Liability Act81
The Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA),82
often referred to as Superfund, provides broad authority for the federal government to respond to
releases or threatened releases of hazardous substances into the environment, in order to protect
public health or welfare, or the environment. Federal resources to carry out response actions
under CERCLA are subject to the availability of appropriations. To minimize the burden of the
costs on the taxpayer, CERCLA established a liability scheme to hold persons responsible for a
release or threatened release liable for response costs (i.e., cleanup costs), natural resource
damages, and the costs of federal public health studies that may be carried out at a site to assess
potential hazards.83 The categories of “potentially responsible parties” who may be held liable
under CERCLA include past and current owners and operators of facilities from which there is a
release or threatened release of a hazardous substance, persons who arranged for disposal or
treatment of hazardous substances (often referred to as generators of wastes), and persons who
transported hazardous substances and selected the site for disposal or treatment.84 The President’s
response and enforcement authorities under CERCLA are delegated by Executive Order to the
Environmental Protection Agency (EPA) and certain other federal departments and agencies to
fulfill various functions under the statute.85
79
See EPA Special Litigation and Projects Division presentation to the American State and Tribal Solid Waste
Management Organization on “EPA’s Energy Extraction Enforcement Initiative,” (October 2011), including
presentation materials for Sandra Connors, Deputy Director, EPA Office of Resource Conservation and Recovery on
“Exploration & Production Waste and RCRA,” p. 31, available at http://www.astswmo.org/Files/Meetings/2011/2011Annual/Presentations/EPA-Hydro-Fracturing.pdf.
80
42 U.S.C. §6921(b)(2)(C).
81
Although the sites at which hydraulic fracturing is conducted may not fit the typical mold of
Superfund sites, it is possible that hydraulic fracturing operations86 could result in the release of
hazardous substances into the environment at or under the surface in a manner that may endanger
80
42 U.S.C. §6921(b)(2)(C).
David M. Bearden, Specialist in Environmental Policy, Resources, Science, and Industry Division, contributed to the
preparation of this section of the report.
82
42 U.S.C. §§9601-9675.
83
CERCLA also authorizes the federal government to respond to releases, or threatened releases, of pollutants or
contaminants into the environment that may present an imminent and substantial danger to public health or welfare, but
liability under the statute only extends to releases or threatened releases of hazardous substances.
84
42 U.S.C. §9607(a).
85
For further discussion of the scope and authorities of CERCLA, see CRS Report R41039, Comprehensive
Environmental Response, Compensation, and Liability Act: A Summary of Superfund Cleanup Authorities and Related
Provisions of the Act, by David M. Bearden.
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Although the sites at which hydraulic fracturing is conducted may not fit the typical mold of
Superfund sites, it is possible that hydraulic fracturing operations86 could result in the release of
hazardous substances into the environment at or under the surface in a manner that may endanger
86
With respect to potential contamination, releases of hazardous substances possibly could occur as a result of many
different aspects of oil and gas production that involve hydraulic fracturing as an extraction technique. Various
stakeholders have used the term hydraulic fracturing in differing ways to reflect a varying scope of activities. In the oil
and gas industry, the term refers to a specific technique to stimulate oil or gas production from a formation, whereas
others may use the term to refer broadly to unconventional oil and gas production and related activities. For more
background on the variety of activities associated with shale gas production in particular, see CRS Report R42333,
Marcellus Shale Gas: Development Potential and Water Management Issues and Laws, by Mary Tiemann et al.
81
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public health or the environment. If a release were to occur as a result of hydraulic fracturing, the
facility owner and operator and other potentially responsible parties could face liability under
CERCLA. However, certain exclusions or exemptions from the statute potentially could limit
liability in such instances, including the petroleum and natural gas exclusion and the exemption
from liability for federally permitted releases, discussed below.
Petroleum and Natural Gas Exclusion
Although releases of petroleum and natural gas generally are excluded from the authorities of
CERCLA, this exclusion does not constitute a broader facility or industry exclusion, but is a
substance exclusion alone. Therefore, CERCLA may apply to hazardous substances released into
the environment from a petroleum or natural gas facility.87 Similarly, CERCLA also potentially
could apply to releases of hazardous substances resulting from oil or natural gas production, but
not releases of petroleum or natural gas itself.
The petroleum and natural gas exclusion is found in the CERCLA definition of a “hazardous
substance,” where the statute provides that the term “does not include petroleum, including crude
oil or any fraction thereof which is not specifically listed or designated as a hazardous substance
... and the term does not include natural gas, natural gas liquids, liquefied natural gas or synthetic
gas usable for fuel.”88 Therefore, while CERCLA would not apply to leaked petroleum products
at a fracking site, contamination of a site by any substance that does satisfy the definition of a
“hazardous substance” could result in liability under the statute. For example, if fracking fluid
contained components (i.e., constituents) that are considered hazardous substances under
CERCLA, and such fluids were released into the environment at a site in a way that could
endanger public health or the environment, the release could warrant cleanup actions, the costs of
which the potentially responsible parties would be liable for under CERCLA. Liability similarly
could arise from releases of hazardous substances that may be present in produced wastewaters
from hydraulic fracturing.
Exemption for Federally Permitted Releases
Whether a release of hazardous substances that may result from hydraulic fracturing operations
would be in compliance with a federal permit (including permits issued by states under delegated
federal authorities) or a state-authorized permit would be a critical factor in determining liability.
CERCLA exempts persons from liability for response costs or damages under the statute resulting
86
With respect to potential contamination, releases of hazardous substances possibly could occur as a result of many
different aspects of oil and gas production that involve hydraulic fracturing as an extraction technique. Various
stakeholders have used the term hydraulic fracturing in differing ways to reflect a varying scope of activities. In the oil
and gas industry, the term refers to a specific technique to stimulate oil or gas production from a formation, whereas
others may use the term to refer broadly to unconventional oil and gas production and related activities. For more
background on the variety of activities associated with shale gas production in particular, see CRS Report R42333,
Marcellus Shale Gas: Development Potential and Water Management Issues and Laws, by Mary Tiemann et al.
87
See EPA, Substances Covered Under Reporting Requirement, Petroleum Exclusion, http://www.epa.gov/osweroe1/
content/reporting/faq_subs.htm.
88
42 U.S.C. §9601(14).
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from a “federally permitted release.”89 This exemption provides relief from liability under
CERCLA, but does not preclude liability under other federal or state law, including common law.
CERCLA defines a federally permitted release to include any underground injection of fluids
authorized under the Safe Drinking Water Act, any discharges of wastewater authorized under the
Clean Water Act, and other discharges or emissions authorized under certain other federal
statutes.90 This definition also includes any underground injection of fluids or other materials
authorized under applicable state law for the production or enhanced recovery of crude oil or
87
See EPA, Substances Covered Under Reporting Requirement, Petroleum Exclusion, http://www.epa.gov/osweroe1/
content/reporting/faq_subs.htm.
88
42 U.S.C. §9601(14).
89
42 U.S.C. §9607(j).
90
42 U.S.C. §9601(10).
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natural gas, or the reinjection of produced waters.91 The exemption from liability under CERCLA
for a federally permitted release therefore may include a state permitted release in such instances.
Examples of Application of CERCLA Response Authority
EPA has used the response authorities of CERCLA to investigate potential contamination in
groundwater in at least two instances that have received prominent attention at locations where
natural gas extraction using hydraulic fracturing has been conducted. One such instance occurred
in Dimock, PA, and another has occurred in Pavillion, WY. EPA initiated the Pavillion
groundwater investigation in response to a public petition submitted under CERCLA92 in 2008
that cited concerns of residents about groundwater quality.93 EPA issued a draft investigation
report for the Pavillion site on December 8, 2011, but the report has not been finalized to date.94
On June 20, 2013, EPA announced that it does not plan to finalize its groundwater investigation
report for the Pavillion site.95 EPA indicated that it would defer to the state of Wyoming to assume
the lead in investigating drinking water quality in the area, and that its continuing role would
focus on providing technical support to the state.96 The state intends to conclude its investigation
and release a final report by September 30, 2014.97
On January 19, 2012, EPA issued an Action Memorandum for the Dimock site to “request and
document approval of an emergency removal action to prevent, limit, or mitigate the threats
posed by the presence of hazardous substances at the Dimock Residential Groundwater Site ...
pursuant to Section 104(a) of the Comprehensive Environmental Response, Compensation and
Liability Act.”98 The Action Memorandum noted that “[h]istoric drilling activities in the Dimock
89
42 U.S.C. §9607(j).
42 U.S.C. §9601(10).
91
42 U.S.C. §9601(10)(I).
92
area have used materials containing hazardous substances” and that there was “reason to believe
that a release of hazardous substances has occurred” that may have contaminated groundwater
used by residents in the area.99 EPA announced on July 25, 2012, that it had completed its
91
42 U.S.C. §9601(10)(I).
42 U.S.C. §9605(d). CERCLA authorizes any person who is or may be affected by a release or threatened release of
a hazardous substance, pollutant, or contaminant to petition the President (as delegated to EPA and other federal
departments and agencies) to assess potential hazards to public health and the environment. Id.
93
EPA, Region 8 and Office of Research and Development, National Risk Management Research Laboratory, (Draft)
Investigation of Ground Water Contamination near Pavillion, Wyoming, at 1 (December 2011), http://www.epa.gov/
region8/superfund/wy/pavillion/EPA_ReportOnPavillion_Dec-8-2011.pdf.
94
For information on the status of the Pavillion groundwater investigation, see EPA’s Region 8 website:
http://www2.epa.gov/region8/pavillion. For additional background information, see CRS Report R42327, The EPA
Draft Report of Groundwater Contamination Near Pavillion, Wyoming: Main Findings and Stakeholder Responses, by
Peter Folger, Mary Tiemann, and David M. Bearden.
95
Press Release, Wyoming to Lead Further Investigation of Water Quality Concerns Outside of Pavillion with Support
of EPA (June 20, 2013), http://yosemite.epa.gov/opa/admpress.nsf/20ed1dfa1751192c8525735900400c30/
dc7dcdb471dcfe1785257b90007377bf!OpenDocument.
96
Id.
97
Id.
98
Action Memorandum-Request for Funding for a Removal Action at the Dimock Residential Groundwater Site,
(continued...)
90
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area have used materials containing hazardous substances” and that there was “reason to believe
that a release of hazardous substances has occurred” that may have contaminated groundwater
used by residents in the area.99 EPA announced on July 25, 2012, that it had completed its
Intersection of PA Routes 29 and 2024 Dimock Township, Susquehanna County, Pennsylvania (Jan 19, 2012),
available at http://www.epaosc.org/sites/7555/files/Dimock%20Action%20Memo%2001-19-12.PDF.
99
Id.
92
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groundwater investigation at the Dimock site and determined that contaminant levels did not
warrant further action by the agency.100
Although the Dimock and Pavillion sites differ in terms of their geophysical characteristics and
other site-specific conditions, they offer examples of the use of the authorities of CERCLA to
investigate potential contamination at locations where hydraulic fracturing has been conducted. In
both cases, EPA has not confirmed a definitive link between a release of hazardous substances
and hydraulic fracturing, and no potentially responsible parties have been identified at either site
who would be liable under CERCLA.
National Environmental Policy Act101
The National Environmental Policy Act (NEPA) requires federal agencies to consider the
potential environmental consequences of proposed federal actions and to involve the public in the
federal decision-making process, but does not compel agencies to choose a particular course of
action.102 If the action is anticipated to affect significantly the quality of the human environment,
the agency must document its consideration of those effects in an environmental impact statement
(EIS). If the degree of impacts is uncertain, an agency may prepare an environmental assessment
(EA) to determine whether a finding of no significant impact (FONSI) could be made or whether
an EIS is necessary. There are certain categories of action that do not individually or cumulatively
have a significant effect on the human environment and, thus, do not require the preparation of an
EIS or EA.103 These include some actions related to oil and gas exploration and production on
federal lands.104
In contrast to the other environmental statutes discussed in this report, NEPA is a procedural
statute. It requires that agencies assess the environmental consequences of an action. If the
adverse environmental effects of the proposed action are adequately identified and evaluated, an
agency is not constrained by NEPA from deciding that other benefits outweigh the environmental
costs and moving forward with the action. Because the requirements of NEPA apply only to
federal actions,105104 NEPA applies to hydraulic fracturing activities only when such activities take
(...continued)
Intersection of PA Routes 29 and 2024 Dimock Township, Susquehanna County, Pennsylvania (Jan 19, 2012),
available at http://www.epaosc.org/sites/7555/files/Dimock%20Action%20Memo%2001-19-12.PDF.
99
Id.
100
place on federal lands or when there is otherwise a sufficient federal nexus to hydraulic
fracturing. The following sections discuss two case studies involving a potential federal role in
the production of oil or natural gas resources that may potentially require the preparation of a
NEPA document.
100
Press release: “EPA Completes Drinking Water Sampling in Dimock, PA,” available at http://yosemite.epa.gov/opa/
admpress.nsf/d0cf6618525a9efb85257359003fb69d/1a6e49d193e1007585257a46005b61ad!.
101
Linda Luther, Analyst in Environmental Policy, Resources, Science, and Industry Division, contributed to the
preparation of this section of the report.
102
See 42 U.S.C. §4332. For more information on the legal aspects of NEPA, see CRS Report RS20621, Overview of
National Environmental Policy Act (NEPA) Requirements, by Kristina Alexander. For a discussion of the policy
aspects of NEPA, see CRS Report RL33152, The National Environmental Policy Act (NEPA): Background and
Implementation, by Linda Luther.
103
40 C.F.R. §1508.4.
104
42 U.S.C. §15942.
105
42 U.S.C. §4332.
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place on federal lands or when there is otherwise a sufficient federal nexus to hydraulic
fracturing. The following sections discuss three case studies involving a potential federal role in
the production of oil or natural gas resources that may potentially require the preparation of a
NEPA document. By statute, there is a rebuttable presumption that the use of a categorical exclusion under NEPA
applies if certain actions related to oil and gas exploration or development on federal lands are conducted pursuant to
the Mineral Leasing Act. 42 U.S.C. §15942.
104
42 U.S.C. §4332.
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Drilling in the Monterey Shale: Federal Oil and Gas Leases
Oil and gas companies have shown interest in drilling in the Monterey Shale in Central
California.106105 The shale formation has beenwas at one time estimated to contain billions of barrels of oil,
most of
which may be economically recovered only through the use of hydraulic fracturing and horizontal
horizontal drilling.107106 In 2011, the Bureau of Land Management (BLM) sold leases in four
parcels, which
accounted for about 2,700 acres of public land, to private parties.108107 Environmental
groups sued
BLM, claiming that the agency had violated the Administrative Procedure Act (APA)
and NEPA
when it prepared an EA, resulting in a FONSI, instead of an EIS for the proposed lease
sale.109108
During the public comment period for the EA, several parties expressed concerns about the
potential environmental effects of hydraulic fracturing.110109 However, BLM declined to analyze
these impacts because, in its view, they were “not under the authority or within the jurisdiction of
the BLM.”111110 After issuing a FONSI, BLM proceeded with the auction.112111
The Council on Environmental Quality (CEQ) promulgated regulations implementing NEPA that
are broadly applicable to all federal agencies.113112 Those regulations specify what agencies must do
to determine whether a proposed action will significantly affect the environment and, therefore,
require preparation of an EIS.114113 To determine what constitutes “significant” effects, CEQ
regulations require agencies to consider the context of the action and intensity or severity of its
impacts.115114 Environmental impacts that must be considered include those identified by CEQ as
direct, indirect (reasonably foreseeable future impacts), or cumulative.116115
The district court examined the 10 factors CEQ regulations identify as requiring consideration
when determining the severity of an action’s impacts.117116 Consistent with those factors, the court
identified three factors that it believed required BLM to prepare an EIS. According to the court,
these were: (1) hydraulic fracturing is highly controversial because of its potential effects on
106health and the environment; (2) the proposed lease sale would affect public health and safety
because of the risk of water pollution; and (3) the environmental impacts of hydraulic fracturing
105
Order Re: Cross Motions for Summary Judgment at 1-2, Ctr. for Biological Diversity v. Bureau of Land Mgmt., No.
11-06174 (N.D. Cal. March 31, 2013).
107106
Id. at 2-3.
108107
Id. at 12.
109108
Id. at 1.
110109
Id. at 6-7.
111110
Id.
112111
Id. at 10. The FONSI discussed potential impacts on protected wildlife and plant species but did not discuss
hydraulic fracturing. Id. at 27.
113112
40 C.F.R. §§1500-1508. CEQ directed all federal agencies to adopt procedures to supplement the CEQ regulations
to include detail specific to the classes of action implemented by that agency (40 C.F.R. §1507.3).
114113
40 C.F.R. §§1501.3-.4.
115114
40 C.F.R. §1508.27.
116115
40 C.F.R. §1508.8.
117116
Order Re: Cross Motions for Summary Judgment at 20.
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health and the environment; (2) the proposed lease sale would affect public health and safety
because of the risk of water pollution; and (3) the environmental impacts of hydraulic fracturing
are uncertain.118are uncertain.117 The court also found that BLM did not properly investigate possible direct or
indirect impacts of its decision.119118
In March 2013, the district court held that the BLM NEPA review was “erroneous as a matter of
law.”120119 The court held that BLM unreasonably relied on an environmental analysis that (1)
assumed only one exploratory well would be drilled on the leased acres when it was reasonably
foreseeable that more wells would be drilled; and (2) did not contain a detailed assessment of the
environmental impacts of hydraulic fracturing and horizontal drilling.121120
Delaware River Basin Commission: Proposed Regulations
on Natural Gas Development
The Delaware River Basin Compact is an agreement among the federal government, Delaware,
New Jersey, New York, and Pennsylvania.122121 The compact creates the Delaware River Basin
Commission (DRBC) and grants it certain powers to manage the water resources of the basin.123122
In December 2010, the commission published draft regulations “to protect the water resources of
the Delaware River Basin during the construction and operation of natural gas development
projects.”124123 In May 2011, New York Attorney General Eric Schneiderman brought a federal
lawsuit on behalf of the state of New York alleging that five federal agencies and their officers
were in violation of NEPA.125124 In November 2011, the complaint was amended to add the DRBC
and its executive director as defendants.126125 The plaintiffs asked the court to compel the defendants
to prepare an EIS “before proceeding to adopt federal regulations to be administered by DRBC
that would authorize natural gas development within the Delaware River Basin.”127126 New York
alleged that the approval of the DRBC regulations was a major federal action requiring at least
118
one of the defendants to prepare an EIS.127 New York alleged that the refusal of the five federal
117
Id. at 24-27.
Id. at 26-28.
120119
Id. at 2. The court also held that BLM had an obligation to prepare a NEPA document prior to the sale of leases that
did not contain No Surface Occupancy (NSO) provisions rather than during the Application for Permit to Drill (APD)
process. Id. at 15-18. This was because once non-NSO leases had been issued, BLM retained limited authority to deny
a lessee drilling rights during the APD process, and thus an “irretrievable commitment of resources” under NEPA had
occurred. Id.; see also 42 U.S.C. §4332(C)(v); 40 C.F.R. §§1501.2, 1502.5.
121120
Order Re: Cross Motions for Summary Judgment at 1-2.
122121
Delaware River Basin Compact, 75 Stat. at 689. The text of the compact is contained in the federal law approving
the compact.
123122
Delaware River Basin Compact §§1.3(c), (e); 2.1; 3.1.
124123
Delaware River Basin Commission, Draft Natural Gas Development Regulations, http://www.nj.gov/drbc/programs/
natural/draft-regulations.html.
125124
Initial Complaint at ¶¶ 1, 95, New York v. U.S. Army Corps of Eng’rs, No. 11-2599 (E.D.N.Y. May 31, 2011).
126125
Amended Complaint at ¶ 1, New York v. U.S. Army Corps of Eng’rs, No. 11-2599 (E.D.N.Y. Nov. 22, 2011).
127126
Amended Complaint at ¶ 1 (abbreviations omitted). According to the complaint, if the DRBC approved the
regulations, “between 15,000 and 18,000 natural gas wells” would be developed within the Delaware River Basin using
high-volume hydraulic fracturing. Id. at ¶ 4. High-volume hydraulic fracturing has raised concerns among some groups
because of its potential effects on water resources and the environment. For more information on this issue, see CRS
Report R41760, Hydraulic Fracturing and Safe Drinking Water Act Regulatory Issues, by Mary Tiemann and Adam
Vann.
119
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one of the defendants to prepare an EIS.128 New York alleged that the refusal of the five federal
127
Id. at ¶¶ 37, 95, 99-100, 109-11.
118
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agencies that are represented by the DRBC’s federal member129member128 to prepare an EIS was not in
accordance with law and was arbitrary, capricious, and an abuse of discretion under the APA.130129
Because it appears that the Delaware River Basin Compact exempts the DRBC from compliance
with the APA,131130 New York argued that the DRBC’s refusal to prepare an EIS was subject to
judicial review under the compact itself.132131
The federal defendants moved to dismiss the lawsuit on the grounds that the court lacked subject
matter jurisdiction over the plaintiff’s claims.133132 In addition to procedural arguments, the federal
defendants maintained that NEPA did not apply because the DRBC’s development of proposed
regulations was not a “major federal action.”134133 The federal defendants argued that no federal
action existed because, in their view, the DRBC was not a federal agency.135134 In addition, the
federal defendants argued that they did not exercise enough decision-making power, authority, or
control over the DRBC’s development of the proposed regulations to render it a federal action.136135
In September 2012, the United StatesU.S. District Court for the Eastern District of New York granted
the the
defendants’ motions to dismiss New York’s complaint for lack of subject matter
jurisdiction.137 136
The court held that it lacked subject matter jurisdiction for two reasons. First, the
court held that
New York lacked standing because it could not show an immediate threat of injury
to its interests
from the proposed regulations.138137 Alternatively, the court held that it lacked subject
matter matter
jurisdiction because New York’s complaint was not ripe for review.139138 Because the court
dismissed the plaintiffs’ complaint on procedural grounds, it did not reach the merits of the
plaintiffs’ claims. However, because the court dismissed the suit without prejudice, the plaintiffs
may file it again in the future if final regulations are adopted.140
128
Id. at ¶¶ 37, 95, 99-100, 109-11.
139
128
These agencies are the Army Corps of Engineers, Fish and Wildlife Service, National Park Service, Department of
the Interior, and Environmental Protection Agency.
130129
Id. at ¶ 106; see also 5 U.S.C. §706(2)(A). NEPA does not contain a private right of action.
131130
See Delaware River Basin Compact, P.L. 87-328, §15.1(m), 75 Stat. 688, 715 (1961) (“For purposes of ... the Act of
June 11, 1946, 60 Stat. 237, as amended ... the Commission shall not be considered a Federal agency.”).
132131
Amended Complaint at ¶¶ 11, 115; see also Delaware River Basin Compact, §3.3(c), 75 Stat. 688, 693 (“Any other
action of the commission pursuant to this section shall be subject to judicial review in any court of competent
jurisdiction.”).
133132
Memorandum of Law in Support of Motion to Dismiss at 1, New York v. U.S. Army Corps of Eng’rs, No. 11-2599
(E.D.N.Y. June 4, 2012). The DRBC and its executive director also filed a motion to dismiss the complaint. See
Delaware River Basin Commission and Carol R. Collier’s Memorandum of Law in Support of Their Motion To
Dismiss the Amended Complaint of New York State, New York v. U.S. Army Corps of Eng’rs, No. 11-2599 (E.D.N.Y.
Jan. 12, 2011).
134133
Id. at 33.
135134
Id. at 33-34.
136135
Id. at 34-39.
137136
Memorandum and Order at 4, New York v. U.S. Army Corps of Eng’rs, No. 11-2599 (E.D.N.Y. Sept. 24, 2012).
138137
Id. at 22.
139138
Id. at 28.
140139
Id. at 23.
129
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USDA Rural Development Agency: Mortgages on Properties
with Drilling Leases
The U.S. Department of Agriculture’s (USDA’s) Rural Development agency helps low to
moderate income homebuyers purchase single-family homes in rural communities.141 Rural
Development assistance may be provided in the form of grants, direct loans, or loan guarantees to
qualified homebuyers. As a federal action, the provision of financial assistance to homebuyers is
subject to NEPA. However, that assistance generally requires minimal NEPA review.
While all federal actions are subject to NEPA, CEQ regulations recognize that there are certain
categories of action that do not individually or cumulatively have a significant effect on the
human environment and, thus, do not require the preparation of an EIS or EA.142 In developing
their own procedures to implement NEPA, federal agencies were required to identify agency
actions likely processed as categorical exclusions (CEs). In its procedures implementing NEPA,143
Rural Development identifies CEs for actions associated with its “housing assistance” activities,
including “the provision of financial assistance for the purchase of a single family dwelling or a
multi-family project serving no more than four families, i.e. units”).144
In rural communities, property owners sometimes lease subsurface mineral rights to oil and gas
companies. Homebuyers seeking assistance from Rural Development may want to purchase a
home on property with existing leases for gas and oil exploration. Such property may have ongoing oil and gas drilling operations or have such operations in the future, including hydraulic
fracturing. The potential for properties to have ongoing or future oil and gas exploration and
development activities has led some, including Rural Development employees, to question
whether assistance to purchase properties with existing oil and gas leases should involve the
preparation of an EA or EIS.145
An action normally processed as a CE may require the preparation of an EA or EIS if that action
involves “extraordinary circumstances” that may have a significant environmental effect.146 As
required by CEQ, Rural Development’s NEPA procedures identify extraordinary circumstances
potentially applicable to its actions.147 In March 2012, Rural Development’s Housing and
Community Facilities Program issued an Administrative Notice clarifying that the presence of gas
exploration leases on a property alone does not constitute the extraordinary circumstances
identified in its NEPA procedures or involve policy considerations that would require additional
141
USDA, Rural Development Housing and Community Facilities Programs, available at http://www.rurdev.usda.gov/
rhs/common/program_info.htm.
142
40 C.F.R. §1508.4.
143
Departmental “Environmental Program” guidelines, including those that implement NEPA, are provided in Rural
Development Instruction Part 1940, Subpart G (RD Instruction 1940-G). As required in the CEQ regulations (at 40
C.F.R. §§1507.3 and1508.4), Rural Development identified CEs under §1940.310; methods to ensure proper
implementation of CEs are listed under §1940.317.
144
Id. §1940.310(b)(1).
145
Ian Urbina, Mortgages for Drilling Properties May Face Hurdle, N.Y. Times, Mar. 18, 2012, available at
http://www.nytimes.com/2012/03/19/us/drilling-property-mortgages-may-get-closer-look-from-agriculture-dept.html?
pagewanted=all.
146
At §1940.317(e); as required under 40 C.F.R. §1507.3(b)(2)(ii).
147
Id. §1940.317(e).
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NEPA review.148 The March 2012 notice also states that security and appraisal requirements
applicable to property serving as collateral would continue to apply to properties with existing oil
and gas leases.149
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The Debate over Public Disclosure of
the Chemical Composition of
Hydraulic Fracturing Fluids
The composition of the fluid used in hydraulic fracturing varies with the nature of the formation
but typically contains mostly water; a proppant to keep the fractures open, such as sand; and a
small percentage of chemicals.150140 A primary function of these chemicals is to assist the movement
of the proppant into the fractures made in the formation.151141 Although some of these chemicals
may be harmless, others may be hazardous to health and the environment.152142 A report by the
minority staff of the House Committee on Energy and Commerce found that between 2005 and
2009, the 14 leading oil and gas service companies used 780 million gallons of chemical products
in fracturing fluids.153143
Calls for public disclosure of information about chemicals used in hydraulic fracturing have
increased as homeowners and others express concerns about the potential presence of unknown
chemicals in tainted well water near oil and gas operations.154144 Proponents of chemical disclosure
laws maintain that public disclosure of the chemicals used in each well would allow for health
professionals to better respond to medical emergencies involving human exposure to the
chemicals; assist researchers in conducting health studies on shale gas production; and permit
regulators and others to perform baseline testing of water sources to track potential groundwater
contamination if it occurs.155145 However, some manufacturers of the additives, as well as others in
the industry, remain reluctant to disclose information about the chemicals they use. These parties
have expressed concerns that disclosure would reveal proprietary chemical formulas to their
competitors, destroying the parties’ valuable trade secrets.156
148
USDA, Rural Development Administrative Notice No. 4632 (1940-G), “NEPA Compliance for Rural Development
Single Family Housing Loan Programs” (March 2012), available at http://www.rurdev.usda.gov/SupportDocuments/
an4632.pdf.
149
Id. Security and appraisal requirements are found at RD Instruction 1980-D, and RD Handbook 3550.
150146
In 2011, President Barack Obama directed Secretary of Energy Steven Chu to convene a panel to
study the effects of shale gas production on health and the environment.147 The Shale Gas
Production Subcommittee of the Secretary of Energy Advisory Board made several
140
Department of Energy, Modern Shale Gas Development in the United States: A Primer, 56, 61-64 (2009)
[hereinafter Department of Energy Primer], http://www.netl.doe.gov/technologies/oil-gas/publications/epreports/
shale_gas_primer_2009.pdf.
151energy.gov/sites/prod/files/2013/03/f0/ShaleGasPrimer_Online_42009.pdf.
141
Id.; Reservoir Stimulation §§7-6.2, 7-6.4 (Michael J. Economides et al. eds, 3d ed. 2000).
152142
Department of Energy Primer at 62. See also Minority Staff of House Committee on Energy and Commerce, 112th
Congress, Chemicals Used in Hydraulic Fracturing 5, 9 (2011) [hereinafter Minority Report on Fracturing Chemicals],
http://democrats.energycommerce.house.gov/sites/default/files/documents/
Hydraulic%20Fracturing%20Report%204.18.11.pdf.
153143
Minority Report on Fracturing Chemicals at 5.
154144
For more information on this issue, see CRS Report R41760, Hydraulic Fracturing and Safe Drinking Water Act
Regulatory Issues, by Mary Tiemann and Adam Vann.
155145
See Lisa Song, Secrecy Loophole Could Still Weaken BLM’s Tougher Fracturing Regs, InsideClimate News,
February 15, 2012.
156146
See Minority Report on Fracturing Chemicals at 11-12. Some manufacturers of fracturing fluid additives have
(continued...)
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In 2011, President Barack Obama directed Secretary of Energy Steven Chu to convene a panel to
study the effects of shale gas production on health and the environment.157 The Shale Gas
Production Subcommittee of the Secretary of Energy Advisory Board made several
recommendations intended to address these effects.158claimed that developing the additives costs millions of dollars and takes several years. See Mike Soraghan, Two-thirds
of Frack Disclosures Omit ‘Secrets,’ http://www.eenews.net/public/energywire/2012/09/26/1.
147
For more on the subcommittee’s work, see Improving the Safety & Environmental Performance of Hydraulic
Fracturing, http://www.shalegas.energy.gov/.
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recommendations intended to address these effects.148 One recommendation calls for the public
disclosure, on a “well-by-well basis,” of all of the chemicals added to fracturing fluids, with some
protection for trade secrets.159149 No federal law currently requires parties to submit detailed
information about the chemical composition of a hydraulic fracturing fluid. Under the Emergency
Planning and Community Right-to-Know Act (EPCRA), owners or operators of facilities where
certain hazardous hydraulic fracturing chemicals are present above certain thresholds may have to
comply with emergency planning requirements; emergency release notification obligations; and
hazardous chemical storage reporting requirements.160150 In addition, environmental advocacy
groups have petitioned EPA to collect and share health and environmental effect information for
hydraulic fracturing chemicals under the Toxic Substances Control Act and to require the oil and
gas extraction industry to report the toxic chemicals it releases under EPCRA Section 313, which
established EPA’s Toxics Release Inventory.161151
Several states have adopted chemical disclosure requirements in the form of laws, regulations, or
administrative interpretations.162152 The Interstate Oil and Gas Compact Commission (IOGCC), an
organization with members that include state regulators and industry representatives, has argued
that current regulation of hydraulic fracturing by the states is sufficient.163153
Toxic Substances Control Act
A main goal of the Toxic Substances Control Act (TSCA) is to protect human health and the
environment from unreasonable risks associated with toxic chemicals in U.S. commerce.164154 Under
the act, EPA may require manufacturers and processors of chemicals to develop, maintain, and
(...continued)
claimed that developing the additives costs millions of dollars and takes several years. See Mike Soraghan, Two-thirds
of Frack Disclosures Omit ‘Secrets,’ http://www.eenews.net/public/energywire/2012/09/26/1.
157
For more on the subcommittee’s work, see Improving the Safety & Environmental Performance of Hydraulic
Fracturing, http://www.shalegas.energy.gov/.
158
report data on the chemicals’ effects on health and the environment.155 EPA may also place certain
restrictions on chemicals when the agency has a reasonable basis to conclude that they present—
or will present—an unreasonable risk of injury to health or the environment.156 However, EPA
may regulate the chemicals only “to the extent necessary to protect adequately against such risk
using the least burdensome requirements.”157
148
Department of Energy, Shale Gas Production Subcommittee Second Ninety Day Report 1 (2011),
http://www.shalegas.energy.gov/resources/111811_final_report.pdf.
159149
Id. at 5-6, 17.
160150
42 U.S.C. §§11002, 11004, 11021, 11022.
161151
Earthjustice, Citizen Petition Under Toxic Substances Control Act Regarding the Chemical Substances and
Mixtures Used in Oil and Gas Exploration or Production 1, 22, http://earthjustice.org/sites/default/files/
fracking_petition.pdf; Earthworks, Petition to Add the Oil and Gas Extraction Industry, Standard Industrial
Classification Code 13, to the List of Facilities Required to Report under the Toxics Release Inventory 1,
http://www.earthworksaction.org/library/detail/petition_to_add_oil_gas_extraction_to_TRI.
162152
For an overview of state requirements of this type and other federal proposals, see CRS Report R42461, Hydraulic
Fracturing: Chemical Disclosure Requirements, by Brandon J. Murrill and Adam Vann.
163153
Interstate Oil and Gas Compact Commission, Hydraulic Fracturing, http://www.iogcc.state.ok.us/hydraulicfracturing.
164154
15 U.S.C. §2601; S. Rep. No. 94-1302, at 56 (1976) (Conf. Rep.). For more information on TSCA, see CRS Report
RL31905, The Toxic Substances Control Act (TSCA): A Summary of the Act and Its Major Requirements, by Linda-Jo
Schierow.
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report data on the chemicals’ effects on health and the environment.165 EPA may also place certain
restrictions on chemicals when the agency has a reasonable basis to conclude that they present—
or will present—an unreasonable risk of injury to health or the environment.166 However, EPA
may regulate the chemicals only “to the extent necessary to protect adequately against such risk
using the least burdensome requirements.”167
Jerry H.
Yen.
155
E.g., 15 U.S.C. §§2603, 2607.
156
15 U.S.C. §2605(a).
157
Id. EPA must consider the benefits of the chemical product or process when considering how, if at all, to regulate it.
Not all of the chemicals used in hydraulic fracturing are necessarily subject to regulation under TSCA. For example,
(continued...)
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On August 4, 2011, Earthjustice and more than 100 other environmental advocacy organizations
petitioned EPA to promulgate rules under Section 4 and Section 8 of TSCA for chemical
substances and mixtures used in oil and gas exploration or production (E&P Chemicals).168158
Section 4 of TSCA authorizes EPA to issue rules requiring manufacturers or processors of
chemicals to test the chemicals in order to obtain data on their health and environmental
effects.169159 Section 8 of TSCA generally authorizes EPA to require manufacturers, processors, and
distributors of chemicals in U.S. commerce to maintain and report certain data on the health and
environmental effects of the chemicals.170160 The petition stated that EPA and the public “lack
adequate information about the health and environmental effects of E&P Chemicals, which are
used in increasing amounts to facilitate the rapid expansion of oil and gas development
throughout the United States.”171161
Earthjustice and the other petitioners further argued that E&P Chemicals may present an
unreasonable risk of injury to health and the environment for several reasons. Petitioners
maintained that, for example, leaks and spills of the chemicals may cause harm to people and
animals, as well as the quality of air, water, and soil.172162 The petitioners also argued that the large
volume of chemicals used in hydraulic fracturing of wells in the United States could result in
substantial human exposure to the chemicals, as well as a substantial release of the chemicals into
the environment.173163 In the petitioners’ view, testing was needed to obtain sufficient data on the
chemicals’ effects because existing federal and state disclosure requirements were inadequate.174164
EPA’s response to the petitioners was mixed. In a November 2, 2011, letter, EPA denied the
petitioners’ request for promulgation of a TSCA Section 4 test rule.175 In a short paragraph, the
165
E.g., 15 U.S.C. §§2603, 2607.
15 U.S.C. §2605(a).
167
Id. EPA must consider the benefits of the chemical product or process when considering how, if at all, to regulate it.
Not all of the chemicals used in hydraulic fracturing are necessarily subject to regulation under TSCA. For example,165 In a short paragraph, the
agency wrote that the petitioners had failed to present sufficient facts for EPA to find that such a
rule was necessary.166 However, in a November 23, 2011, letter, EPA partially granted petitioners’
Section 8(a) and Section 8(d) requests.167 The agency wrote that it would initiate a rulemaking to
gather available data on the chemicals used in hydraulic fracturing.168 However, the agency
(...continued)
biocides, which are often used in a fracturing fluid to kill bacteria, may be subject to regulation as pesticides under the
Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA). See id. §2602. See also Gayathri Vaidyanathan, Official
Urges EPA Review, Labeling of Fracking Substances, E&E News (Oct. 24, 2012). For more information on FIFRA,
see CRS Report RL31921, Pesticide
Law: A Summary of the Statutes, by Linda-Jo SchierowJerry H. Yen and Robert Esworthy.
168158
Earthjustice, Citizen Petition Under Toxic Substances Control Act Regarding the Chemical Substances and
Mixtures Used in Oil and Gas Exploration or Production 1, 22, [hereinafter Earthjustice Petition],
http://earthjustice.org/sites/default/files/fracking_petition.pdf. Section 21 of TSCA allows any person to petition EPA
to adopt a new rule under certain sections of the act. 15 U.S.C. §2620.
169159
15 U.S.C. §2603. See; see also 40 C.F.R. §790.1. The petitioners also asked EPA to require manufacturers and
processors to disclose the identities of the chemicals they were required to test. Earthjustice Petition at 18.
170160
15 U.S.C. §2607.
171161
Earthjustice Petition at 1.
172162
Earthjustice Petition at 13-19.
173163
Id. at 19.
174164
Id. at 5-10.
175165
Letter from Assistant Administrator Stephen A. Owens to Deborah Goldberg (Nov. 2, 2011), http://www.epa.gov/
(continued...)
166
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agency wrote that the petitioners had failed to present sufficient facts for EPA to find that such a
rule was necessary.176 However, in a November 23, 2011, letter, EPA partially granted petitioners’
Section 8(a) and Section 8(d) requests.177 The agency wrote that it would initiate a rulemaking to
gather available data on the chemicals used in hydraulic fracturing.178 However, the agency
oppt/chemtest/pubs/SO.Earthjustice.Response.11.2.pdf.
166
Id.
167
Letter from Assistant Administrator Stephen A. Owens to Deborah Goldberg (Nov. 23, 2011), http://www.epa.gov/
oppt/chemtest/pubs/EPA_Letter_to_Earthjustice_on_TSCA_Petition.pdf.
168
Id.
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declined to issue rules for other chemicals in the oil and gas exploration and production sector.179169
EPA intends to discuss potential Section 8 reporting requirements with the states, industry, and
public interest groups to “minimize reporting burdens and costs, take advantage of existing
information, and avoid duplication of efforts.”180170 On July 11, 2013, EPA published an explanation
of the reasons for the agency’s response to the petition.181 As of the date of this report, neither a
proposed rule nor an advance notice of proposed rulemaking has been issued.182171
In May 2014, EPA issued an advance notice of proposed rulemaking “to develop an approach to
obtain information on chemical substances and mixtures used in hydraulic fracturing.”172 EPA
indicated that it had not yet determined whether to mandate disclosure of the chemical
information under TSCA, provide incentives for voluntary reporting, or use an approach
combining aspects of both mandatory and voluntary disclosure.173
Occupational Safety and Health Act
The Occupational Safety and Health Administration has promulgated a set of regulations under
the Occupational Safety and Health Act (OSHAct) referred to as the Hazard Communication
Standard (HCS).183174 A primary purpose of the HCS is to ensure that employees who may be
exposed to hazardous chemicals in the workplace are aware of the chemicals’ potential dangers.184175
Manufacturers and importers must obtain or develop Material Safety Data Sheets (MSDS) for
hydraulic fracturing chemicals that are hazardous according to OSHA standards.185176 MSDS must
list basic information about the identity of the chemicals; the chemicals’ potential hazards; and
safety precautions for their handling and use, among other things.186177 The HCS requires operators
to maintain MSDS for hazardous chemicals at the job site.187178
MSDS may provide limited information about hydraulic fracturing chemicals. Currently, the most
specific details about chemical identities that must be listed on the data sheets are the common or
(...continued)
oppt/chemtest/pubs/SO.Earthjustice.Response.11.2.pdf.
176
Id.
177
Letter from Assistant Administrator Stephen A. Owens to Deborah Goldberg (Nov. 23, 2011), http://www.epa.gov/
oppt/chemtest/pubs/EPA_Letter_to_Earthjustice_on_TSCA_Petition.pdf.
178
Id.
179
Id.
180
Id.
181chemical names of substances that are considered to be hazardous under OSHA regulations.179
169
Id.
Id.
171
U.S. Environmental Protection Agency, “Chemical Substances and Mixtures Used in Oil and Gas Exploration or
Production; TSCA Section 21 Petition; Reasons for Agency Response,” 78 Federal Register 41768, July 11, 2013.
182
172
EPA, Advance Notice of Proposed Rulemaking, Hydraulic Fracturing Chemicals and Mixtures, 79 Fed. Reg. 28664
(May 19, 2014).
173
Id. For the current status of the rulemaking, see http://yosemite.epa.gov/opei/RuleGate.nsf/byRIN/2070-AJ93.
183174
29 C.F.R. §1910.1200. See also 29 U.S.C. §655. OSHA recently modified its Hazard Communication Standard,
effective May 25, 2012. The regulation now requires that by June 1, 2015, employers communicate workplace hazards
to employees by using Safety Data Sheets that are consistent with the United Nations Globally Harmonized System of
Classification and Labeling of Chemicals. 29 C.F.R. §1910.1200(a), (j). In addition to other information, the data sheets
will be required to contain a more specific description of certain chemical substances and mixtures, provided that this
information does not qualify for trade secret protection under the regulations. Id. §1910.1200(g), (i), app. D. During the
transition period, parties may comply with the new regulations, the previous version of the regulations, or both. Id.
§1910.1200(j)(3).
184175
Id. §1910.1200(a)-(b) (2011).
185176
See id. §1910.1200(d), (g).
186177
See id. §1910.1200(g).
187
See id.
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chemical names of substances that are considered to be hazardous under OSHA regulations.188
178
See id.
179
Id. §1910.1200(g)(2). For more information on the limitations of MSDS, see Clifford S. Mitchell & Brian S.
Schwartz, Limitations of Information About Health Effects of Chemicals, Journal of General Internal Medicine,
(continued...)
170
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Chemical Abstract Service Registry Numbers (CASRNs) for substances or mixtures do not have
to be listed. In addition, parties that prepare MSDS may withhold chemical identity information
from the data sheets at their discretion in some circumstances.189180 However, the regulations do not
prevent parties from voluntarily submitting data sheets with more detailed information.
Emergency Planning and
Community Right-to-Know Act
The Emergency Planning and Community Right-to-Know Act (EPCRA) establishes programs to
provide members of the public with information about hazardous chemicals located in their
communities.190181 It also requires that representatives from different levels of government
coordinate their efforts with communities and industry to prepare response plans for emergencies
involving the accidental release of hazardous chemicals.191182
The act seeks to induce each state to establish a State Emergency Response Commission
(SERC).192183 Each SERC appoints and coordinates the activities of a Local Emergency Planning
Committee (LEPC) for each emergency planning district created within a state or across multiple
states.193184 A LEPC is responsible for developing an emergency response plan for an accidental
chemical release with input from stakeholders and submitting it to the SERC.194185 Generally, a
facility is subject to EPCRA’s emergency planning requirements if there is a substance on EPA’s
list of extremely hazardous substances (EHS) present at the facility in excess of its EPAdetermined threshold planning quantity.195186 Whether a well site where hydraulic fracturing occurs
would be subject to EPCRA’s planning requirements would depend on the identities and
quantities of the chemicals present, among other things.
Emergency Release Notification and
Hazardous Chemical Storage Reporting Requirements
Under Section 304 of EPCRA, an owner or operator of a facility must immediately notify the
SERC and the community emergency coordinator for the LEPC in the affected area if an
188
Id. §1910.1200(g)(2). For more information on the limitations of MSDS, see Clifford S. Mitchell & Brian S.
Schwartz, Limitations of Information About Health Effects of Chemicals, Journal of General Internal Medicine,accidental release of a chemical that is an EHS occurs in an amount in excess of its reportable
(...continued)
http://www.ncbi.nlm.nih.gov/pmc/articles/PMC1495173/pdf/jgi_01217.pdf.
189180
Id. §1910.1200(i)(1) (2011). See also Mike Soraghan, In Fracking Debate, ‘Disclosure’ Is in the Eye of the
Beholder, New York Times (June 21, 2010).
190181
H. Rep. No. 99-962, at 281 (1986) (Conf. Rep.). For more on EPCRA, see CRS Report RL32683, The Emergency
Planning and Community Right-to-Know Act (EPCRA): A Summary, by Linda-Jo Schierow.
191David M. Bearden.
182
42 U.S.C. §11001; H. Rep. No. 99-962, at 281 (1986) (Conf. Rep.).
192183
42 U.S.C. §11001(a).
193184
Id. §11001(a)-(c).
194185
Id. §§11001(c), 11003.
195186
Id. §11002. EPA’s list of EHS and their threshold planning quantities is located at 40 C.F.R. Part 355 appendixes A
and B. A state governor or SERC may designate additional facilities as subject to EPCRA, provided that the
designation is made after public notice and opportunity for comment. 42 U.S.C. §11002(b)(2).
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accidental release of a chemical that is an EHS occurs in an amount in excess of its reportable
quantity from a facility where an EHS is produced, used, or stored.196187 This information must be
made available to the public.197188
Section 311 of EPCRA generally requires that facility owners or operators submit an MSDS for
each hazardous chemical198chemical189 present that exceeds an EPA-determined threshold level, or a list of
such chemicals, to the LEPC, SERC, and the local fire department.199190 For non-proprietary
information, the act generally requires a LEPC to provide an MSDS to a member of the public on
request.200191 Again, whether a well site where hydraulic fracturing occurs would be subject to
EPCRA’s requirements would depend on the identities and quantities of the chemicals present,
among other things.
Under Section 312 of EPCRA, facility owners or operators must submit annual chemical
inventory information for hazardous chemicals present at the facility in excess of an EPAdetermined threshold level to the LEPC, SERC, and the local fire department.201192 There are two
types of information that may have to be submitted. If the facility owner or operator is required to
report “Tier I information,” then the inventory form must contain information about the
maximum and average daily aggregate amounts of chemicals in each hazard category present at
the facility during the prior year, as well as the general location of chemicals in each category.202193
However, most states require the submission of “Tier II information.”203194 This information
includes “Tier I information,” as well as the chemical or common name of each hazardous
chemical as listed on its MSDS and the location and manner of storage of the chemical at the
facility.204195 Tier II information for the prior calendar year for a particular facility must be made
available to members of the public upon written request.205196 A SERC or LEPC must disclose to the
196
187
Id. §11004. If the release of an EHS is not required to be reported to the National Response Center under Section
103(a) of CERCLA, then the notification must be made only if (1) the release is not a federally permitted release under
CERCLA; (2) it exceeds the relevant minimal reportable quantity established by EPA regulation, or if none has been
established, one pound; and (3) it “occurs in a manner which would require notification under section 103(a) of
CERCLA.” Id. If the release is required to be reported to the National Response Center, but it is not a release of an
EHS, then notice must be given if the release is of a substance with a reportable quantity established under CERCLA,
or, if no reportable quantity has been established, if the release exceeds one pound. Id. A list of designated CERCLA
hazardous substances and their reportable quantities is located at 40 C.F.R. §302.4.
In addition, the notification provision “does not apply to any release which results in exposure to persons solely within
the site or sites on which a facility is located.” 42 U.S.C. §11004. The release notification requirements are in addition
to those under CERCLA. 40 C.F.R. §355.60. Different notification requirements apply when a release involves
transportation of a substance or storage of a substance incident to its transportation. 42 U.S.C. §11004(b).
197188
Id. §11044.
198189
“Hazardous chemical” in this section of EPCRA refers to chemicals that require an MSDS under OSHAct. It is a
more inclusive term than EHS.
199190
Id. §11021.
200191
Id. §11021(c). Regulations promulgated under EPCRA set forth procedures for EPA to follow when reviewing a
claim that information submitted to EPA is a trade secret. 40 C.F.R. Part 350.
201192
Id. §11022.
202193
Id. §11022(d).
203194
Environmental Protection Agency, Tier II Chemical Inventory Reports, http://www.epa.gov/osweroe1/content/
epcra/tier2.htm.
204195
42 U.S.C. §11022(d). The owner may withhold proprietary information from disclosure in some circumstances. Id.
§11042.
205196
42 U.S.C. §11022(e).
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requester any non-proprietary information it possesses.206197 If the SERC or LEPC lacks the
information for a hazardous chemical, then it must request the information from the facility
owner or operator and disclose the non-proprietary portions of it to the requester.207198
Earthworks Petitioners’ Request
for the Oil and Gas Extraction Industry
to Report Under the Toxics Release Inventory
Section 313 of EPCRA requires owners or operators of certain facilities to report information
about the release into the environment of certain “toxic” chemicals from the facilities.208199 This
information must be disclosed to federal and state officials, who in turn disclose the nonproprietary details to the public via the Toxics Release Inventory (TRI) website.209200 Generally, the
reporting requirements apply to owners or operators of facilities with 10 or more full-time
employees when the facilities fall under certain Standard Industrial Classification or North
American Industry Classification System codes and manufactured, processed, or otherwise used a
listed toxic chemical in excess of its threshold reporting amount during the applicable calendar
year.210201 Facilities used by the oil and gas extraction industry are generally not included in the
industry codes
required to report under the TRI.211202
Section 313(b) allows EPA to add or delete industry codes as needed.212203 In October 2012,
Earthworks and several other environmental advocacy organizations asked EPA to require the oil
and gas extraction industry to report the toxic chemicals it releases under the TRI program.213204
When determining whether to add new industry groups, EPA has previously considered three
factors:
(1) Whether one or more listed toxic chemicals are reasonably anticipated to be present at
facilities in that industry (chemical factor); (2) whether facilities within the candidate
industry group ‘manufacture,’ ‘process,’ or ‘otherwise use’ EPCRA section 313 listed toxic
chemicals (activity factor); and (3) whether addition of facilities within the candidate
industry group reasonably can be anticipated to increase the information made available
206197
Id.
Id. If the SERC or LEPC lacks the information for a hazardous chemical stored in an amount of less than 10,000
pounds during the prior year, the requester must state the general need for the information. Id.
208199
Id. §11023(a), (b). The list of applicable toxic chemicals and chemical categories is located at 40 C.F.R. §372.65.
Under the Pollution Prevention Act, facility owners or operators covered by EPCRA requirements must also report
information about toxic chemical source reduction and recycling. 42 U.S.C. §13106.
209200
Id. §11023(h), (j). For more information on this website, see http://www.epa.gov/tri/.
210201
42 U.S.C. §11023(b). “Manufacture” means “to produce, prepare, import, or compound a toxic chemical.” Id.
“Process” means “the preparation of a toxic chemical, after its manufacture, for distribution in commerce.” Id. EPA
may also subject owners or operators of facilities with fewer than 10 employees and/or in other industry codes to the
requirements in certain circumstances if those facilities manufacture, process, or use any of certain “toxic” chemicals.
Id.
211202
GAO 12-874, at 184.
212203
42 U.S.C. §11023(b).
213204
Earthworks, Petition to Add the Oil and Gas Extraction Industry, Standard Industrial Classification Code 13, to the
List of Facilities Required to Report under the Toxics Release Inventory 1 [hereinafter Earthworks Petition],
http://www.earthworksaction.org/library/detail/petition_to_add_oil_gas_extraction_to_TRI.
207198
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pursuant to EPCRA section 313 or to otherwise further the purposes of EPCRA section 313
(information factor).214205
The Earthworks petitioners argued that the oil and gas extraction industry met the chemical factor
because drilling, well development, and hydraulic fracturing at well sites use many chemicals
listed on the TRI.215206 With respect to the activity factor, the petitioners maintained that the industry
manufactured, processed, and otherwise used TRI chemicals via well completions, well
development, and hydraulic fracturing, among other processes.216207 Finally, petitioners argued that
the information factor was satisfied because existing federal and state disclosure laws were
“inadequate.”217208 The petition is still under review.
State Preemption of Municipal Land Use
and Zoning Powers
As the use of hydraulic fracturing and horizontal drilling to initiate production from oil and gas
wells has increased, owners of property located near oil and gas operations have expressed
concerns about the potential effects of these activities on the environment.218209 Additionally, some
worry that the proximity of oil and gas operations to their homes will cause a decline in the values
of their properties.219210 In response to these concerns, many local governments have increased their
regulation of hydraulic fracturing and related oil and gas production activities.220211 Some
requirements imposed by local governments appear to be intended to regulate the land use aspects
of oil and gas operations.221212 However, other requirements have tended toward regulation of the
technical aspects of oil and gas operations.222213
In addition to raising questions about the relationship between federal and state authority, the
increase in local regulation of hydraulic fracturing has led to questions about the relationship
between state and local authority. Regulation of oil and gas operations is an area of mixed state
and local concern.223214 It implicates the state’s interest in the safe and efficient development of its
natural resources and the local government’s interest in regulating land uses to protect the public
from harm to property values, health, and the environment.224215 In matters of mixed state and local
214205
Final Rule, Addition of Facilities in Certain Industry Sectors; Revised Interpretation of Otherwise Use; Toxic
Release Inventory Reporting; Community Right-to-Know, 62 Fed. Reg. 23,834, 23,842 (May 1, 1997).
215206
Earthworks Petition at 7.
216207
Id.
217208
Id. at 7-8.
218209
See, e.g., Water Pollution from Shale Wells Is Major Concern for Pennsylvania Homeowners – Study, E&E News
(November 8, 2012), http://www.eenews.net/energywire/2012/11/08/8.
219210
Id.
220211
E.g., City of Longmont, Colorado, Ordinance O-2012-25, Amending Chapters 15.04, 15.05, 15.07, 15.10 and
Appendix B of Title 15 of the Longmont Municipal Code Regarding Oil and Gas Well Operations and Facilities (July
24, 2012), http://www.ci.longmont.co.us/pwwu/oil_gas/documents/CA_20120724_125237.pdf.
221212
Id. at 3 (stating, with some exceptions, that “City oil and gas well permits may be issued for sites within the City
excluding oil and gas well surface operations and facilities in residential zoning districts.”).
222213
Id. at 26 (“The operator shall make reasonable efforts to minimize methane emissions by using all feasible ‘green
completion’ techniques ... and the installation of ‘low-bleed’ pneumatic instrumentation and closed loop systems.”).
223214
See, e.g., Robinson Twp. v. Commonwealth, 52 A.3d 463, 483 (Pa. Commw. Ct. 2012).
224215
Id.
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concern, states retain authority over local governments, even when municipalities enjoy some
degree of independence from the state as a result of “home rule” provisions.225216 However, the
Pennsylvania Supreme Court held that the state could not preempt municipal zoning restrictions
when it would violate guarantees contained in the state’s constitution.217
The question of state preemption of municipal land use and zoning powers arises when both state
and local governments seek to regulate oil and gas production. Although the doctrine of
preemption may differ among the states, most jurisdictions recognize three types of preemption:
(1) express preemption, in which the express language of the state statute or regulation shows that
the state intended to preempt all local control over regulation of a particular subject matter; (2)
occupation of the field, in which the state’s regulatory scheme is so comprehensive that it leaves
the locality no room in which to regulate; and (3) conflict preemption, in which a local law is
preempted to the extent that it conflicts with the application of the state law.226218
State Court Cases
When a state law expressly preempts requirements imposed on oil and gas operations by
localities, state courts have engaged in statutory interpretation to determine the scope of the
preemption.227 Two state courts in New York have held that, under that state’s laws, a
municipality may generally regulate where oil and gas development occurs but not how it
occurs.228 In the unusual case of Robinson Township v. Commonwealth, a Pennsylvania appeals
court considered a state law that expressly preempted local zoning laws. The court held that
towns’ substantive due process rights were violated by the state when Pennsylvania passed a law
that required local governments to allow certain oil and gas facilities in all of their zoning
districts, subject only to minor limitations such as setback requirements.229 Pennsylvania had
argued that the law would advance the commonwealth’s legitimate interest in the safe and
efficient development of its oil and gas resources by eliminating differences in local zoning
ordinances that had burdened the industry and its investors with expense and uncertainty.230
However, the court held that this mandate was irrational and an improper exercise of the state’s
police power because it allowed incompatible uses in zoning districts, and thus denied the towns
substantive due process under the state constitution.231
A West Virginia case illustrates the doctrine of field preemption in the oil and gas context.232 In
Northeast Natural Energy, LLC v. City of Morgantown, a state court held that state law left no
room for local regulation of oil and gas development and production.233
225
219 For example, in 2014 the New York Court of Appeals issued a decision finding
that zoning restrictions enacted by two municipalities did not conflict with the state’s mineral
resource laws.220 The municipalities claimed that the zoning restrictions were valid exercises of
the state’s Home Rule law, which empowers local governments to pass laws for the “protection
and enhancement of [their] physical and visual environment” and for the “government,
protection, order, conduct, safety, health and well-being of persons or property therein,”221 and
that their exercise of this authority to restrict certain drilling practices was not preempted by the
state’s oil and gas law.222 The court agreed, finding that the preemption language in the state oil
and gas law limited “only local laws that purport to regulate the actual operations of oil and gas
activities, not zoning ordinances that restrict or prohibit certain land uses within town
boundaries.”223 In the court’s opinion, the new zoning restrictions “are directed at regulating land
use generally and do not attempt to govern the details, procedures or operations of the oil and gas
industries.” As a result the court found that the local zoning restriction did not preempt the state’s
oil and gas laws.224
216
See, e.g., Webb v. City of Black Hawk, 295 P.3d 480, 486 (Colo. 2013) (“For matters that involve mixed state and
local concerns, a home-rule regulation may coexist with a state regulation only as long as there is no conflict. However,
in the event of a conflict, the state statute supersedes the conflicting local regulation to the extent of the conflict.”)
(citations omitted).
226218
E.g., Bd. of County Comm’rs of La Plata County v. Bowen/Edwards Assocs., Inc., 830 P.2d 1045, 1056-57 (Colo.
1992).
227219
Cooperstown Holstein Corp. v. Town of Middlefield, 943 N.Y.S.2d 722, 724 (N.Y. Sup. Ct. 2012); Anschutz
Exploration Corp. v. Town of Dryden, 940 N.Y.S.2d 458, 466 (N.Y. Sup. Ct. 2012).
228
Cooperstown Holstein Corp.220
Wallach v. Town of Middlefield, 943 N.Y.S.2d 722, 729 (N.Y. Sup. Ct. 2012); Anschutz
Exploration Corp. v. Town of Dryden, 940 N.Y.S.2d 458, 467 (N.Y. Sup. Ct. 2012). The court’s decision in Anschutz
was upheld on appeal to the New York Supreme Court, Appellate Division. See Opinion and Order at 15, Norse Energy
Corp. USA v. Town of Dryden, No. 515227 (N.Y. App. Div. May 2, 2013).
229
Robinson Twp. v. Commonwealth, 52 A.3d 463, 485 (Pa. Commw. Ct. 2012). The case is on appeal to the
Pennsylvania Supreme Court.
230
Id. at 483.
231
Id. at 485.
232
Order at 6, Ne. Natural Energy, LLC, v. City of Morgantown, No.11-C-411 (W. Va. Cir. Ct. Monongalia County,
2011).
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Dryden, 2014 NY LEXIS 1766; 2014 NY Slip. Op. 4875 (N.Y. June 30, 2014).
221
N.Y. CLS Mun. Home Rule §10.
222
Wallach, 2014 NY LEXIS at *5, *7.
223
Id. at *17.
224
Id. at *35.
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In the case of Robinson Township v. Commonwealth, a Pennsylvania appeals court considered a
state law (Act 13) that expressly preempted local zoning laws. The court held that towns’
substantive due process rights were violated by the state when Pennsylvania passed a law that
required local governments to allow certain oil and gas facilities in all of their zoning districts,
subject only to minor limitations such as setback requirements.225 Pennsylvania had argued that
the law would advance the commonwealth’s legitimate interest in the safe and efficient
development of its oil and gas resources by eliminating differences in local zoning ordinances
that had burdened the industry and its investors with expense and uncertainty.226 However, the
court held that this mandate was irrational and an improper exercise of the state’s police power
because it allowed incompatible uses in zoning districts, and thus denied the towns substantive
due process under the state constitution.227 The Pennsylvania Supreme Court subsequently
affirmed the appeals court’s holding that provisions of Act 13 preempting certain municipal
zoning restrictions on oil and gas facilities were invalid under the Pennsylvania constitution.228
A West Virginia case illustrates the doctrine of field preemption in the oil and gas context.229 In
Northeast Natural Energy, LLC v. City of Morgantown, a state court held that state law left no
room for local regulation of oil and gas development and production.230
With regard to conflict preemption, state courts have considered whether the local requirement
interferes with the state’s regulatory scheme governing oil and gas development so as to result in
an “operational conflict” with the state’s objectives.234231 Courts considering whether a particular
local regulation is preempted under this test generally evaluate each requirement imposed by the
regulation on a case-by-case basis to determine whether there is a conflict.235232 In some instances,
courts must examine not only what the local regulation requires on its face but also how the
regulation is applied in practice by the local government.236233 Under the operational conflicts test,
the Colorado Supreme Court held that state law preempted a home rule city’s total ban on oil and
gas drilling.237234 In July 2014, a Colorado district court held that state law preempted the city of
Longmont’s ban on hydraulic fracturing, stating that, “The operational conflict in this case is
225
Robinson Twp. v. Commonwealth, 52 A.3d 463, 485 (Pa. Commw. Ct. 2012).
Id. at 483.
227
Id. at 485.
228
Robinson Township v. Commonwealth, 83 A.3d 901, 985 (Pa. 2013). Three of the justices in the majority held that
the provision violated the state constitution’s Environmental Rights Amendment because it was “incompatible with the
Commonwealth’s duty as trustee of Pennsylvania’s public natural resources.” Id. The other justice in the majority
concurred but would have grounded the decision in the Act 13 provision’s violation of substantive due process
guarantees. Id. at 1001.
229
Order at 6, Ne. Natural Energy, LLC, v. City of Morgantown, No.11-C-411 (W. Va. Cir. Ct. Monongalia County,
2011).
230
Id. at 9; Order Granting Plaintiff’s Motion for Summary Judgment on First Claim for Relief at 7, No. 13CV31385,
Colorado Oil and Gas Association v. City of Fort Collins (Colo. Dist. Ct. Larimer County, Aug. 7, 2014) (“The Court
finds that the City’s Ordinance banning all hydraulic fracturing for five years is impliedly preempted by the [Colorado
Oil and Gas Conservation Act].”).
231
Bd. of County Comm’rs of La Plata County v. Bowen/Edwards Assocs., Inc., 830 P.2d 1045, 1059 (Colo. 1992).
The Colorado cases outlining the operational conflict test were decided before the widespread use of hydraulic
fracturing in combination with horizontal drilling, and thus it is unclear whether the Colorado Supreme Court would
issue similar decisions today. See Jeff Overley, Oil And Gas Group Sues Colorado Town To Kill Fracking Ban,
Law360 (Dec. 18, 2012).
232
Bowen/Edwards at 1060.
233
Id.
234
Voss v. Lundvall Bros., Inc., 830 P.2d 1061, 1062 (Colo. 1992).
226
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obvious. The [Colorado Oil and Gas Conservation] Commission permits hydraulic fracturing and
Longmont prohibits it.”235
Alternatives to Preemption
Some states have tried to use alternative methods of accommodating joint state and local
regulatory authority over oil and gas operations. Colorado offers one example. In a February 2012
executive order, Colorado Governor John Hickenlooper wrote that “proving operational conflict
is an adversarial, cumbersome, time consuming, and expensive process.”238236 The governor created
a task force to consider how local governments could coordinate their regulatory efforts with the
state to avoid litigation.239237 In April 2012, the task force issued a letter in which it wrote that its
members had “determined that drawing bright lines between state and local jurisdictional
authority was neither realistic nor productive.”240238 Members of the task force recommended that
local governments enter into memoranda of understanding with operators and intergovernmental
agreements with the Colorado Oil and Gas Conservation Commission (COGCC) to address local
concerns.241239 The task force also suggested that the local governments designate a representative to
provide input to operators and the COGCC during the permitting process.242240
State Tort Law
Owners of property located near oil and gas operations have brought common law tort claims
against companies that operate oil and gas wells and related infrastructure.243 Plaintiffs have
(...continued)
233
Id. at 9.
234
Bd. of County Comm’rs of La Plata County v. Bowen/Edwards Assocs., Inc., 830 P.2d 1045, 1059 (Colo. 1992).
The Colorado cases outlining the operational conflict test were decided before the widespread use of hydraulic
fracturing in combination with horizontal drilling, and thus it is unclear whether a court would issue similar decisions
today. See Jeff Overley, Oil And Gas Group Sues Colorado Town To Kill Fracking Ban, Law360 (Dec. 18, 2012). For
a New York court case addressing conflict preemption, see Opinion and Order at 13-15, Norse Energy Corp. USA v.
Town of Dryden, No. 515227 (N.Y. App. Div. May 2, 2013).
235
Id. at 1060.
236
Id.
237
Voss v. Lundvall Bros., Inc., 830 P.2d 1061, 1062 (Colo. 1992).
238241 Plaintiffs have
claimed that damages have occurred as a result hydraulic fracturing and related oil and gas
operations, including contamination of land from drilling waste placed into pits on the plaintiffs’
properties;242 noise and air pollution from natural gas compressor stations;243 contamination of
water supplies;244 damage to a house allegedly caused by vibrations from nearby drilling
activity;245 and personal injury.246 Common law causes of action brought under state tort law have
included claims for nuisance, trespass, negligence, and strict liability, among others.247 Plaintiffs
235
Order Granting Motions for Summary Judgment at 14, No. 13CV63, Colorado Oil and Gas Association v. City of
Longmont (Colo. Dist. Ct. Boulder County, July 24, 2014).
236
John W. Hickenlooper, Executive Order 2012-002, Creating the Task Force on Cooperative Strategies Regarding
State and Local Regulation of Oil and Gas Development (Feb. 29, 2012).
239237
Id.
240238
Recommendations from the Task Force Established by Executive Order 2012-002 Regarding Mechanisms to Work
Collaboratively and Coordinate State and Local Oil and Gas Regulatory Structures (April 18, 2012).
241239
Task Force on Cooperative Strategies Regarding State and Local Regulation of Oil and Gas Development: Protocols
Recommendations 1-2.
242240
Id.
243241
Tucker v. Sw. Energy Co., 2012 U.S. Dist. LEXIS 20697, at *4 (E.D. Ark. Feb. 17, 2012); Ginardi v. Frontier Gas
Servs. LLC, 2011 U.S. Dist. LEXIS 89054, at *2 (E.D. Ark. Aug. 10, 2011).
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claimed that damages have occurred as a result hydraulic fracturing and related oil and gas
operations, including contamination of land from drilling waste placed into pits on the plaintiffs’
properties;244 noise and air pollution from natural gas compressor stations;245 contamination of
water supplies;246 damage to a house allegedly caused by vibrations from nearby drilling
activity;247 and personal injury.248 Common law causes of action brought under state tort law have
included claims for nuisance, trespass, negligence, and strict liability, among others.249 Plaintiffs
242
Teel v. Chesapeake Appalachia, LLC, 2012 U.S. Dist. LEXIS 153509, at *1 (N.D. W. Va. Oct. 25, 2012).
243
Ginardi, 2011 U.S. Dist. LEXIS 89054, at *2.
244
Tucker, 2012 U.S. Dist. LEXIS 20697, at *4; Berish v. Sw. Energy Prod. Co., 763 F. Supp. 2d 702, 704 (M.D. Pa.
2011).
245
Hiser v. XTO Energy Inc., 2012 U.S. Dist. LEXIS 114084, at *1 (E.D. Ark. Aug. 14, 2012).
246
Kamuck v. Shell Energy Holdings GP, LLC, 2012 U.S. Dist. LEXIS 125566, at *5 (M.D. Pa. Sept. 5, 2012).
247
E.g., Teel, 2012 U.S. Dist. LEXIS 153509, at *2.
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have sought monetary and, in some cases, injunctive relief, including remediation of
contaminated property and medical monitoring.250248
Often in these cases, some of the damages are alleged to have occurred underground or in the air
above a plaintiff’s property. As a result, plaintiffs may have difficulty demonstrating that the
activities of the defendants caused them harm.251249 In some cases, defendants have requested that
courts enter modified case management orders (MCMOs) requiring plaintiffs to specifically make
a prima facie showing of exposure, injury, and causation prior to the full discovery process by
submitting expert opinions regarding the nature of the substances to which the plaintiffs were
allegedly exposed; allowing access to the plaintiffs’ medical records; and providing other
supporting data.252 Defendants250 In Colorado, defendants initially succeeded in having one case dismissed after
entry of such an
order because the plaintiffs failed to “produce sufficient information and expert
opinions upon
which to establish the prima facie elements of their claims.”253251 However, ina
Colorado appeals court later reversed the trial court’s entry of the order.252 In some cases courts
have declined to enter MCMOs when there are a limited number of parties to the litigation and
the claims are relatively simple.254253
One question that arises when a court considers whether defendants are subject to strict liability
for their operations is whether hydraulic fracturing and related oil and gas production activities
are abnormally dangerous as a matter of law. Section 519 of the Restatement (Second) of Torts
states that “[o]ne who carries on an abnormally dangerous activity is subject to liability for harm
... of another resulting from the activity, although he has exercised the utmost care to prevent the
244
Teel v. Chesapeake Appalachia, LLC, 2012 U.S. Dist. LEXIS 153509, at *1 (N.D. W. Va. Oct. 25, 2012).
Ginardi, 2011 U.S. Dist. LEXIS 89054, at *2.
246
Tucker, 2012 U.S. Dist. LEXIS 20697, at *4; Berish v. Sw. Energy Prod. Co., 763 F. Supp. 2d 702, 704 (M.D. Pa.
2011).
247
Hiser v. XTO Energy Inc., 2012 U.S. Dist. LEXIS 114084, at *1 (E.D. Ark. Aug. 14, 2012).
248
Kamuck v. Shell Energy Holdings GP, LLC, 2012 U.S. Dist. LEXIS 125566, at *5 (M.D. Pa. Sept. 5, 2012).
249
E.g., Teel, 2012 U.S. Dist. LEXIS 153509, at *2.
250
harm.”254 In determining whether an activity is abnormally dangerous, courts generally consider
six factors:
(a) existence of a high degree of risk of some harm to the person, land or chattels of others;
(b) likelihood that the harm that results from it will be great;
(c) inability to eliminate the risk by the exercise of reasonable care;
(d) extent to which the activity is not a matter of common usage;
(e) inappropriateness of the activity to the place where it is carried on; and
248
E.g., id.; Fiorentino v. Cabot Oil & Gas Corp., 750 F. Supp. 2d 506, 510 (M.D. Pa. 2010).
251
E.g., Tucker, 2012 U.S. Dist. LEXIS 20697, at *6-7 (“Missing are particular facts about particular fracking
operations by particular fracking companies using particular substances that allegedly caused the Berrys’ air problems
and the Tuckers’ water problems. General statements about the many dangerous substances used in fracking, and
conclusory statements about the migration of those substances will not suffice.”).
252250
Roth v. Cabot Oil & Gas Corp., 287 F.R.D. 293, 295 (M.D. Pa. 2012); Kamuck, 2012 U.S. Dist. LEXIS 125566, at
*1-2; Order Re: Defendants’ Motion to Dismiss or, in the Alternative, for Summary Judgment at 2-3, Strudley v.
Antero Resources Corp., No. 2011CV2218 (May 9, 2012). These orders are commonly referred to as “Lone Pine”
orders. See Lore v. Lone Pine Corp., 1986 N.J. Super. LEXIS 1626 (N.J. Super. Ct. Law Div. Nov. 18, 1986).
253251
Order Re: Defendants’ Motion to Dismiss or, in the Alternative, for Summary Judgment at 3, Strudley v. Antero
Resources Corp., No. 2011CV2218 (May 9, 2012).
254
See, e.g., Roth, 287 F.R.D. at 295.
245
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harm.”255 In determining whether an activity is abnormally dangerous, courts generally consider
six factors:
(a) existence of a high degree of risk of some harm to the person, land or chattels of others;
(b) likelihood that the harm that results from it will be great;
(c) inability to eliminate the risk by the exercise of reasonable care;
(d) extent to which the activity is not a matter of common usage;
(e) inappropriateness of the activity to the place where it is carried on; and
252
Strudley v. Antero Res. Corp., 2013 Colo. App. LEXIS 1090, *30 (Colo. App. 2013). In April 2014, the Colorado
Supreme Court agreed to hear the defendants’ appeal of the intermediate court’s decision regarding the MCMO. Antero
Res. Corp. v. Strudley, 2014 Colo. LEXIS 239, *1 (Colo. April 7, 2014).
253
See, e.g., Roth, 287 F.R.D. at 295.
254
Restatement (Second) of Torts §519 (1977).
249
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(f) extent to which its value to the community is outweighed by its dangerous attributes.256
It does not appear that a court has yet decided whether hydraulic fracturing is an abnormally
dangerous activity. One court that considered the question wrote that it could not make the
determination until a full record had been established at the summary judgment stage of the
litigation.257 Another court speculated that it 255
It appears that few courts have considered the issue. In an April 2014 summary judgment order, a
federal district court judge wrote that “based on an analysis of the six factors set forth in the
Restatement (Second) of Torts ... hydraulic fracturing does not legally qualify as an ultrahazardous activity giving rise to strict tort liability.”256 In another case, a court speculated that it
may be difficult for plaintiffs to meet factors (d), (e),
and (f) in the Restatement definition at the
summary judgment stage.258257
With respect to trespass claims, the Texas Supreme Court considered whether the subsurface
hydraulic fracturing of a natural gas well that extended into an adjacent property was a trespass
“for which the value of gas drained as a result may be recovered as damages.”259258 The court held
that such damages could not be recovered because of the rule of capture, which “gives a mineral
rights owner title to the oil and gas produced from a lawful well bottomed on the property, even if
the oil and gas flowed to the well from beneath another owner’s tract.”260259 In another case,
plaintiffs argued that the defendant committed a trespass when it engaged in acts that were not
necessary to the extraction of minerals on the plaintiff’s surface property.261260 Plaintiffs have also
argued that emissions of air pollution over their land constitute a trespass.262
Pending Legislation
On May 9, 2013, the Fracturing Responsibility and Awareness of Chemicals Act of 2013, H.R.
1921, was introduced in the House of Representatives. The bill contains two amendments to the
Safe Drinking Water Act (SDWA)—one that would amend the definition of underground injection
to include hydraulic fracturing, and another that would create a new disclosure requirement for
the chemicals used in hydraulic fracturing. A similar bill, S. 1135, was introduced in the Senate
by Senator Robert Casey on June 11, 2013.
255
Restatement (Second) of Torts §519 (1977).
Id. §§519-20; see also Fiorentino v. Cabot Oil & Gas Corp., 750 F. Supp. 2d 506, 512 (M.D. Pa. 2010).
257
Tucker v. Sw. Energy Co., 2012 U.S. Dist. LEXIS 20697, at *9-10 (E.D. Ark. Feb. 17, 2012).
258
Berish v. Sw. Energy Prod. Co., 763 F. Supp. 2d 702, 706 (M.D. Pa. 2011).
259
Coastal Oil & Gas Corp. v. Garza Energy Trust, 268 S.W.3d 1, 4 (Tex. 2008).
260
Id. at 12-13.
261
Teel v. Chesapeake Appalachia, LLC, 2012 U.S. Dist. LEXIS 153509, at *2-3, 15 (N.D. W. Va. Oct. 25, 2012).
262
Tucker, 2012 U.S. Dist. LEXIS 20697, at *10-11; see also Restatement (Second) of Torts §158 cmt. i (1977).
256
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H.R. 1921 proposes that the definition of “underground injection” that was amended in 2005 to
exclude most hydraulic fracturing would be amended once again to include “the underground
injection of fluids or propping agents pursuant to hydraulic fracturing operations related to oil,
gas, or geothermal production activities,” excluding injection of natural gas for subsurface
storage.263 This would not only repeal the amended definition of “underground injection” that was
enacted as part of EPAct 2005, which excluded hydraulic fracturing, but essentially would codify
the court’s decision in LEAF I and clear up any ambiguity regarding regulation of hydraulic
fracturing under the SDWA.
The second amendment to the SDWA in the bill would create a new hydraulic fracturing
disclosure requirement. H.R. 1921 would create a new statutory obligation requiring anyone
conducting hydraulic fracturing to
disclose to the State (or the Administrator [of the Environmental Protection Agency] if the
Administrator has primary enforcement responsibility in the State)—(I) prior to the
commencement of any hydraulic fracturing operations at any lease area or portion thereof, a
list of chemicals intended for use in any underground injection during such operations,
including identification of the chemical constituents of mixtures, Chemical Abstracts Service
numbers for each chemical and constituent, material safety data sheets when available, and
the anticipated volume of each chemical; and (II) not later than 30 days after the end of any
hydraulic fracturing operations the list of chemicals used in each underground injection
during such operations, including identification of the chemical constituents of mixtures,
Chemical Abstracts Service numbers for each chemical and constituent, material safety data
sheets when available, and the volume of each chemical used.264
The bill would also require that the state or EPA “make the disclosure of chemical constituents ...
available to the public, including by posting the information on an appropriate Internet Web site,”
and the bill clarifies that the disclosure requirements “do not authorize the State (or the [EPA]) to
require the public disclosure of proprietary chemical formulas.”265 In other words, the disclosure
requirements address only the chemicals used, not the manner of their use or the amounts or
ratios in which they were used. This language attempts to protect proprietary business
information, that is, “secret” formulas or practices that drilling companies may feel they should
not be required to disclose to their competitors.
Furthermore, the bill would require operators to disclose proprietary chemical information to
medical professionals in cases of medical emergencies.266 Although most state oil and gas rules
do not require disclosure of proprietary chemical information to medical professionals, such
disclosure broadly parallels federal requirements under the OSHAct.267 Calls for disclosure of
hydraulic fracturing chemicals have increased as homeowners and others express concern about
the potential presence of unknown chemicals in tainted well water near oil and gas operations.
263
H.R. 1921, at §2(a).
H.R. 1921, §2(b).
265
Id.
266
Id.
267
As described above, the Occupational Safety and Health Administration has promulgated a set of regulations under
OSHAct, referred to as the Hazard Communication Standard (29 C.F.R. §1910.1200). Additionally, OSHAct
regulations require operators to maintain MSDS for hazardous chemicals at the job site.
264
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The Climate Protection Act of 2013, S. 332, Section 301, contains similar chemical disclosure
provisions. Additionally, S. 332 would repeal SDWA Section 1425, which provides states with an
alternative to meeting the specific requirements contained in EPA UIC regulations promulgated
under Section 1421 by allowing states to demonstrate to EPA that their existing programs for oil
and gas injection wells are effective in preventing endangerment of underground sources of
drinking water.268
Legislation also has been introduced to require baseline and follow-up testing of potable
groundwater supplies in the vicinity of hydraulic fracturing operations. H.R. 2983, introduced on
August 2, 2013, would amend the SDWA to prohibit hydraulic fracturing unless the person
proposing to conduct the fracturing operations agreed to testing and reporting requirements
regarding underground sources of drinking water. The legislation would require testing prior to
the start of injection operations, and at prescribed intervals during and after hydraulic fracturing
operations. Water sampling would be required at all accessible underground sources of drinking
water within a one-half mile radius of the site where hydraulic fracturing operations occur or, if
no such sources were within one-half mile, then at the nearest accessible source within one mile.
Testing would be required for any contaminant or substance EPA determined would indicate
damage associated with hydraulic fracturing operations. Additionally, H.R. 2983 would require
the agency to post on its website all test results, searchable by zip code.
In contrast to the above bills, several others would prohibit or limit federal regulation of hydraulic
fracturing, particularly on federal lands. H.R. 2728, introduced in July 2013, would amend the
Mineral Leasing Act269 to prohibit the Department of the Interior from enforcing any federal
regulation, guidance, or permit requirement regarding hydraulic fracturing relating to oil, gas, or
geothermal production activities on or under any land in any state that has regulations, guidance,
or permit requirements for hydraulic fracturing. Although this language is broadly applicable to
any federal regulation, guidance, and permit requirements “regarding hydraulic fracturing,” the
prohibition on enforcement applies only to the Department of the Interior, and therefore would
presumably impact only hydraulic fracturing operations on lands managed by that agency. The
bill also would require the Department of the Interior to defer to state regulations, permitting, and
guidance for all activities related to hydraulic fracturing relating to oil, gas, or geothermal
production activities on federal land regardless of whether those rules were duplicative, more or
less restrictive, or did not meet federal guidelines. As reported, the bill would further prohibit the
department from enforcing hydraulic fracturing regulations on Trust lands, except with express
tribal consent. On November 12, 2013, the House Committee on Natural Resources reported H.R.
2728, amended, and the bill was placed on the Union Calendar. Relatedly, H.R. 2513 and S. 1234,
introduced on June 26, 2013, would establish that a state has sole authority to regulate hydraulic
fracturing operations on lands within the boundaries of the state. The legislation further specifies
that hydraulic fracturing of wells on federal public lands shall be subject to the law of the state in
which the land is located.
268
269
42 U.S.C. §300h-4.
30 U.S.C. §181 et seq.
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Legislation in the 113th Congress
In the 113th Congress, several bills propose to expand federal regulation of hydraulic fracturing
activities, while others would limit federal involvement. The Fracturing Responsibility and
Awareness of Chemicals Act of 2013 (FRAC Act) has been introduced in the House (H.R. 1921)
and the Senate (S. 1135). The bills would amend the SDWA to (1) require disclosure of the
chemicals used in the fracturing process, and (2) repeal the hydraulic fracturing exemption
established in EPAct 2005, and amend the term “underground injection” to include the injection
of fluids used in hydraulic fracturing operations, thus authorizing EPA to regulate this process
under the SDWA. Additionally, S. 1135 would authorize states to seek primary enforcement
authority for hydraulic fracturing operations, regardless of whether the state had obtained primacy
for other types of UIC wells, including Class II wells.
Title III of the Climate Protection Act of 2013 (S. 332) contains chemical disclosure provisions
similar to the FRAC Act. S. 332 would also repeal SDWA Section 1425,262 which provides states
with an alternative to meeting the specific requirements contained in EPA UIC regulations
255
Id. §§519-20.
Order at 1-2 & n.2, No. 3:09-cv-2284, Ely v. Cabot Oil & Gas Corp. (M.D. Pa. April 23, 2014). The district court
judge adopted the report and recommendation of the magistrate judge and granted summary judgment to the defendants
on plaintiffs’ Pennsylvania law strict liability claim. Id.
257
Berish v. Sw. Energy Prod. Co., 763 F. Supp. 2d 702, 706 (M.D. Pa. 2011).
258
Coastal Oil & Gas Corp. v. Garza Energy Trust, 268 S.W.3d 1, 4 (Tex. 2008).
259
Id. at 12-13.
260
Teel v. Chesapeake Appalachia, LLC, 2012 U.S. Dist. LEXIS 153509, at *2-3, 15 (N.D. W. Va. Oct. 25, 2012); see
also Whiteman v. Chesapeake Appalachia, LLC, 729 F.3d 381, 394 (4th Cir. 2013) (rejecting a similar trespass claim).
261
Tucker v. Sw. Energy Co., 2012 U.S. Dist. LEXIS 20697, at *10-11 (E.D. Ark. Feb. 17, 2012); see also Restatement
(Second) of Torts §158 cmt. i (1977).
262
42 U.S.C. §300h-4.
256
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promulgated under Section 1421 by allowing states to demonstrate to EPA that their existing
programs for oil and gas injection wells are effective in preventing endangerment of underground
sources of drinking water.263 In addition, S. 332 would require EPA to report to Congress on
fugitive methane emissions resulting from natural gas infrastructure.
Legislation also has been introduced to require baseline and follow-up testing of potable
groundwater in the vicinity of hydraulic fracturing operations. H.R. 2983, the Safe Hydration is
an American Right in Energy Development Act of 2013, would amend the SDWA to prohibit
hydraulic fracturing unless the person proposing to conduct the fracturing operations agreed to
testing and reporting requirements regarding underground sources of drinking water. H.R. 2983
would require testing prior to, during, and after hydraulic fracturing operations. Testing would be
required for any substance EPA determines would indicate damage associated with hydraulic
fracturing operations. The bill also would require EPA to post on its website all test results,
searchable by zip code.
House-passed H.R. 2728, Protecting States’ Rights to Promote American Energy Security Act,
would amend the Mineral Leasing Act264 to prohibit the Department of the Interior from
enforcing any federal regulation, guidance, or permit requirement regarding hydraulic fracturing
relating to oil, gas, or geothermal production activities on or under any land in any state that has
regulations, guidance, or permit requirements for hydraulic fracturing. Although this language is
broadly applicable to any federal regulation, guidance, and permit requirements “regarding
hydraulic fracturing,” the prohibition on enforcement applies only to the Department of the
Interior, and therefore would presumably impact only hydraulic fracturing operations on lands
managed by the department. The bill also would require the Department of the Interior to defer to
state regulations, permitting, and guidance for all activities related to hydraulic fracturing relating
to oil, gas, or geothermal production activities on federal land regardless of whether those rules
were duplicative, more or less restrictive, or did not meet federal guidelines. As reported, the bill
would further prohibit the department from enforcing hydraulic fracturing regulations on Trust
lands, except with express tribal consent. On November 12, 2013, the House Committee on
Natural Resources reported H.R. 2728, amended, and the House passed the bill, amended, on
November 20. The same day, S. 1743, a companion bill to H.R. 2728, as introduced, was offered
in the Senate. H.R. 2728 was placed on the Senate Legislative Calendar on December 9, 2013.
The Empower States Act of 2013, S. 1482, generally would prohibit the Secretary of the Interior
from issuing regulations or guidelines regarding oil and gas production on federal land in a state
if the state has otherwise met the requirements under applicable federal law. Among other
provisions, the bill also would (1) amend the SDWA to require federal agencies, before issuing
any oil and gas regulation or guideline, to seek comment and consult with each affected state
agency and Indian tribe, and (2) require any future rule requiring disclosure of hydraulic
fracturing chemicals to refer to the FracFocus database.
Other bills would limit the federal role in regulating the use of hydraulic fracturing on lands
subject to federal control. The Fracturing Regulations are Effective in State Hands Act, H.R.
2513/S. 1234, would grant states sole authority to regulate hydraulic fracturing on federal lands
within the state and specify that hydraulic fracturing on federal land shall be subject to the law of
263
S. 332, Section 302, would require EPA to report to Congress on fugitive methane emissions resulting from natural
gas infrastructure.
264
30 U.S.C. §§181 et seq.
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the state in which the land is located. This bill is likely a response to a push by the Bureau of
Land Management (BLM) to adopt new regulations governing fracking on federal lands,
discussed below. H.R. 1548 would prohibit the BLM hydraulic fracturing rule from having any
effect on land held in trust or restricted status for Indians, except with the express consent of its
Indian beneficiaries.
H.R. 2850 (H.Rept. 113-252), the EPA Hydraulic Fracturing Study Improvement Act, would
require EPA to follow certain procedures governing peer review and data presentation in
conducting its study on the relationship between hydraulic fracturing and drinking water. As
reported, the bill would require EPA to release the final report by September 30, 2016. H.R. 2850
was placed on the Union Calendar on October 23, 2013.
Conclusion
Environmental statutes enforced by EPA contain several key exemptions for hydraulic fracturing
and related oil and gas production activities. For example, an amendment to the SDWA passed as
a part of the Energy Policy Act of 2005 clarified that the underground injection control
requirements found in the SDWA do not apply to hydraulic fracturing, although the exclusion
does not extend to the use of diesel fuel in hydraulic fracturing operations.270265 In addition, drilling
fluids, produced waters, and other wastes associated with the exploration, development, or
production of crude oil, natural gas, or geothermal energy are exempt from regulation as
hazardous wastes under Subtitle C of RCRA.271266 Under EPCRA, facilities used by the oil and gas
extraction industry are generally not included in the industry codes required to report under the Toxics
Toxics Release Inventory (TRI).
Environmental groups have filed petitions seeking regulation of hydraulic fracturing and related
activities under various environmental laws enforced by EPA. In September 2010, an
environmental advocacy group filed a petition seeking to have EPA regulate drilling fluids,
produced waters, and other wastes associated with the exploration, development, or production of
crude oil, natural gas, or geothermal energy as hazardous waste under Subtitle C of RCRA.272267 In
August 2011, environmental advocacy organizations petitioned EPA to promulgate rules under
Section 4 and Section 8 of TSCA for chemical substances and mixtures used in oil and gas
exploration or production.273268 In October 2012, several environmental advocacy organizations
asked EPA to require the oil and gas extraction industry to report the toxic chemicals it releases
under the TRI program.274
Regulation of hydraulic fracturing by local governments has raised questions about state
preemption of municipal land use and zoning powers. Courts in a few states have ruled that local
governments may regulate where drilling occurs but not how it occurs.275 In addition, owners of
property located near oil and gas operations have brought common law state tort claims against
operators, including claims for negligence, strict liability, nuisance, and trespass to land.276
Although this litigation is still in its early stages, it appears that courts have already faced
questions about causation; whether hydraulic fracturing is an abnormally dangerous activity; and
whether hydraulic fracturing may constitute a subsurface trespass to land.
270269
265
P.L. 109-58 at §322.
Solid Waste Disposal Act Amendments of 1980, P.L. 96-482, §7, 42 U.S.C. §6921(b)(2)(A).
272267
Natural Resources Defense Council, Re: Petition for Rulemaking Pursuant to Section 6974(a) of the Resource
Conservation and Recovery Act Concerning the Regulation of Wastes Associated with the Exploration, Development,
or Production of Crude Oil or Natural Gas or Geothermal Energy 1 (Sept. 8, 2010), http://docs.nrdc.org/energy/files/
ene_10091301a.pdf.
273268
Earthjustice, Citizen Petition Under Toxic Substances Control Act Regarding the Chemical Substances and
Mixtures Used in Oil and Gas Exploration or Production 1, 22, http://earthjustice.org/sites/default/files/
fracking_petition.pdf.
274269
Earthworks, Petition to Add the Oil and Gas Extraction Industry, Standard Industrial Classification Code 13, to the
List of Facilities Required to Report under the Toxics Release Inventory 1, http://www.earthworksaction.org/library/
detail/petition_to_add_oil_gas_extraction_to_TRI.
275
See the discussion above under “State Preemption of Municipal Land Use and Zoning Powers.”
276
See the discussion above under “State Tort Law.”
271
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Regulation of hydraulic fracturing by local governments has raised questions about state
preemption of municipal land use and zoning powers. Courts in a few states have ruled that local
governments may regulate where drilling occurs but not how it occurs.270 In addition, owners of
property located near oil and gas operations have brought common law state tort claims against
operators, including claims for negligence, strict liability, nuisance, and trespass to land.271
Although this litigation is still in its early stages, it appears that courts have already faced
questions about causation; whether hydraulic fracturing is an abnormally dangerous activity; and
whether hydraulic fracturing may constitute a subsurface trespass to land.
Author Contact Information
Adam Vann
Legislative Attorney
avann@crs.loc.gov, 7-6978
Mary Tiemann
Specialist in Environmental Policy
mtiemann@crs.loc.gov, 7-5937
Brandon J. Murrill
Legislative Attorney
bmurrill@crs.loc.gov, 7-8440
270
271
See the discussion above under “State Preemption of Municipal Land Use and Zoning Powers.”
See the discussion above under “State Tort Law.”
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