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NARUC backs continued state regulation of hydraulic fracturing

State utility regulators approved a resolution at their summer convention in Seattle urging Congress to leave regulation of hydraulic fracturing to the states.

The resolution by the National Association of Regulatory Utility Commissioners’ gas committee said that the organization “has observed with great concern the current debate in Congress over the appropriate method for regulating the use of hydraulic fracturing to complete oil and gas wells.”

US Reps. Diana DeGette (D-Colo.) and Maurice D. Hinchey (D-NY) introduced a bill on June 4 which would bring the process, which is used to recover gas from shale formations, under the Safe Drinking Water Act. US Sen. Robert P. Casey Jr. (D-Pa.) introduced similar legislation in the Senate the same day.

Doing so, NARUC’s resolution said, “would add burdensome and unnecessary regulatory requirements to the drilling and completion of oil and gas wells, thereby increasing costs of producing domestic natural gas resources without any ancillary benefit to public health, safety, or the environment.”

The resulting increased cost of producing domestic gas resources would reduce domestic supplies; raise costs to consumers; raise utility prices for consumers; reduce tax and royalty revenue for local, state and federal governments; and increase US dependence on foreign energy imports, it continued.

Oil and gas reservoirs are highly variable geologically and separated geographically across producing states in a manner that makes state regulatory agencies best suited by local expertise to regulate hydraulic fracturing and other exploration, development and production activities, the resolution observed.

It noted that the Interstate Oil and Gas Compact Commission urged Congress on Jan. 9 to not remove hydraulic fracturing’s exemption from regulation under the SDWA after a survey of IOGCC’s members found no known cases of groundwater contamination associated with hydraulic fracturing.

Contact Nick Snow at nicks@pennwell.com


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http://www.ogj.com/content/ogj/en/articles/2009/07/naruc-backs-continued.html