Fracking news: weekly summary

fracking legislation

Over the past week, fracking news highlights include three significant state and local legislative battles in North Carolina, California, and Illinois; natural gas discoveries made in Myanmar; and the beginnings of a new study on fracking and water contamination in China.

1. North Carolina upholds fracking moratorium until 2015

The struggle between state senate and house representatives in North Carolina over a fracking moratorium was settled upon last Friday in a piece of legislation dubbed SB 76. Simply put, the House acted against the Senate’s attempt to “fast-track” shale gas exploration, and instead upheld a cautionary, delayed approach to the issue. Though the bill allows the issuing of provisional fracking contracts to begin in 2015, the moratorium (that passed marginally by one vote last year) will remain firmly in place. Any future contracts depend on revisiting public concerns and discussing legalization of fracking technology. Interestingly, North Carolina already has a ban on the injection of  chemical or industrial waste underground. This ban has been in place for 40 years and constitutes the principal obstacle for the oil & gas industry, which would have to resort to more expensive methods of wastewater disposal.

At least 14 county and town governments, along with the U.S. Marine Corps, have adopted resolutions or position papers opposing deep-well injection as a threat to the region’s underground drinking water…If the industry is forced to rely on other options, which are more expensive and logistically complicated, it could make fracking less feasible here. Alternatives include trucking the fluids to municipal water treatment plants, which are increasingly rejecting fracking residues, or using open-air evaporation in large impoundments. -News Observer, Staff Reports

2. California’s hydraulic fracturing bill

California frackingConversely, California has chosen to regulate, not restrict, fracking. Last week, the California state legislature also passed a decisive piece of legislation to specify the regulatory procedure companies must follow before conducting hydraulic fracturing treatment on any well site. Because it attempts to strike a balance between trade secret protection and public protection regarding the chemical composition of fracking fluids, the law may well be modeled in other states. Companies must only disclose hydraulic fracturing, or HF,  fluid composition to the state’s oil & gas division, not publicly. HF permit approval will no longer be delayed to 2015, but will begin immediately in parallel with independent scientific studies to measure the effects of HF treatment on the surrounding environment, particularly water and air quality. As permits are approved, surface property owners within 1,500 feet of the well site must be notified. The following information is also required in the permit applications:
the well identification and location; the time period during which HF is planned to occur; an estimate of the amount of water to be used and its source; the planned location of the HF treatment on the well bore; the estimated length, height and direction of the induced fractures; and a complete list of the names, Chemical Abstracts Service numbers and estimated concentrations of every chemical constituent of the HF fluids to be used. -Lexology

3. Illinois passes an HF bill similar to California’s

During the same period (29-31st of May), Illinois also approved SB 1715, which outlines a compromise not to outlaw but regulate HF in the southern plains. The most important provisions – like California’s but possibly more stringent – concern wastewater. Requiring companies to store wastewater in closed-loop tanks instead of open air pits, the state’s Department of Natural Resources will also receive mandatory permit fees from drillers to pay for hiring and training inspectors. Inspectors will conduct tests and monitor both well and surface water before, during, and after hydraulic fracturing treatment.
Unlike California, the chemical composition of HF fluids will be publicly disclosed in Illinois. Tom Wolf, from the Illinois Chamber of Commerce’s Energy Council, asserts that the legislation is “probably the most detailed, highly protective bill in the country,” and that carefully developing the shale gas industry could result in $9.5 billion in positive economic impact for Illinois (Southeast Missourian).
Gas for motorcycles and vehicles is often sold on the roads in used bottles; much of Myanmar lacks basic energy infrastructure or access to the country's massive reserves.

Gas for motorcycles and vehicles is often sold on the roads in used bottles; much of Myanmar lacks basic energy infrastructure or access to the country’s massive reserves.

4. Myanmar opens up to foreign investment in oil & gas

On June 7th, Bloomberg reignited the buzz about Myanmar’s large oil and gas reserves, a “frontier market” of 7.8 trillion cubic feet that has only just opened up to investors and speculators from the outside. Unlike the United States and Australia, Myanmar has the geopolitical advantage of being situated between two of the largest energy-hungry economies in the world: China and India. Transport may thus require fewer costly extraction technologies or infrastructural developments. According to Myanmar’s energy ministry and the World Economic Forum’s report from last month, the bids are not only for offshore drilling projects. In fact, 16 foreign companies currently have projects on 17 onshore exploration blocs.
The significance of Myanmar’s natural gas reserves as it relates to the fracking & gas debates elsewhere is worth noting at length. Onshore exploration and extraction projects will necessarily involve greater interaction with local populations, many of whom do not have access to electrical infrastructure and face frequent energy shortages. Last December, there were even power outages at the capital’s international airport. Thus the newly democratized government in Myanmar must also balance the obligation to address its own underdevelopment and citizens’ energy needs with foreign investment, which would garner massive state revenues but may not trickle down to the average Burmese citizen.

5. To come: water impact study on fracking projects in China

Fulbright scholar Becky Tisherman, from Connecticut College, will be heading to Sichuan, China to study how hydraulic fracturing may be affecting the groundwater supply. Previously, Tisherman studied the beginnings of hydraulic fracturing in Beijing. Though it has not been commercialized yet, China’s fracking industry has been supported by the government’s most recent plans for energy and development between now and 2015. Unlike the U.S, the Chinese government has far fewer regulations regarding the energy industry and greater existing problems related to water supply shortages and pollution (unrelated to fracking).
Independent research conducted by Caixin reported that a fracking experiment in northern China, “went awry, forcing local officials to temporarily cut a nearby city’s water supply.” Becky’s research in China may better help policymakers and concerned parties in the United States understand how – or if – hydraulic fracturing affects water, especially in the absence of regulations on the industry.

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