More regulation

March 30, 2015
Officials sounded almost supportive of oil and gas drilling when they explained new federal regulations for hydraulic fracturing to news reporters on Mar. 20.

Officials sounded almost supportive of oil and gas drilling when they explained new federal regulations for hydraulic fracturing to news reporters on Mar. 20. Promising implementation that avoids duplication and requirements for "unnecessary activities," Janice Schneider, Department of the Interior assistant secretary for land and minerals management, declared, "We know how important it is to get this right." Interior Sec. Sally Jewell noted "a lot of public fear and concern, particularly about groundwater" and said the oil industry "recognizes that sensible regulation can help…because it helps address public concerns."

From comments like these, someone might conclude Interior wants the federally administered onshore to participate in an oil and gas supply boom now largely confined to private and state land. But that would break a pattern. In the Obama administration, production of fossil energy yields to regulation.

Interior's context

Interior's own performance provides troubling context. During the Obama presidency, the number of new onshore oil and gas leases issued by the Bureau of Land Management has averaged 1,654/year. During the administration of George W. Bush, the average was 2,946/year. Bill Clinton's administration beat both averages at 3,796/year. The Bush administration's average of onshore acres leased per year was slightly below that of the Clinton era, and both were more than twice the Obama average. The Obama average for applications for permits to drill (APDs), 4,103/year, beats the Clinton score of 2,203/year but falls well shy of the Bush administration's 5,215/year.

According to the Western Energy Alliance, reviews for National Environmental Policy Act leasing documents now require 4 years for small to medium-size oil and gas projects and 3-9 years for large projects. NEPA reviews for large solar projects, which occupy more surface area than oil and gas projects do, can be completed in 9 months, WEA notes. As of last Feb. 15, NEPA delays lasting more than 3 years affected 2,391 wells.

WEA also estimates that acquiring a drilling permit requires an average 194 days. "Many [BLM] field offices are now also leveling ad hoc requirements for APDs that have no basis in regulation or law, asking companies to perform extra cultural, wildlife, flood plain, or other surveys," the group says.

Resistance to the production and use of hydrocarbons is a guiding principal of the administration. This is the team that every year proposes tax changes that would punish oil and gas companies and limit resource development. It's the team that is foreclosing the use of coal with limits on greenhouse gas emissions from power plants. It's the team that proposes a new, unnecessary layer of control on emissions of air pollutants from refineries and of greenhouse gases from upstream and transportation systems.

Obama's team is the one that proposes unwarranted toughening of standards for ozone pollution in a move thought by some to be the most expensive environmental regulation in history. It's the team again having to defend the Environmental Protection Agency's authority in a Supreme Court case, this one related to another costly air-quality initiative, the Mercury and Air Toxics Standard. The Obama team is the one that wants to preclude forever the assessment and development of oil and gas potential of the Arctic National Wildlife Refuge coastal plain. And it's the team that won't approve the Keystone XL Pipeline border crossing.

New fire

Given this record, the oil and gas industry has little reason to think Interior had more drilling and production in mind while fashioning the rules on hydraulic fracturing. In fact, the industry has good reason to greet the initiative as new fire in a regulatory barrage.

Jewell made a solid point when she said sensible regulation can allay public fear. Too frequently, however, fear represents the groundless product of propaganda by groups committed not to making oil and gas work safer, but to halting it. Inaction on Keystone XL is one triumph of that process. Regulation imposed redundantly to assure Americans that fracing won't poison drinking water is another.