I was hoping Interior Secretary Sally Jewell would pass her first test on fully embracing America’s energy abundance. Unfortunately with the Bureau of Land Management’s (BLM) new draft rule on hydraulic fracturing on federal lands, she failed. As Karen Harbert, president and CEO of the U.S. Chamber’s Institute for 21st Century Energy put it, “BLM’s rule is a solution in search of a problem.” “States are much better suited to regulate hydraulic fracturing and have done an effective job.”
Harbert noted that BLM’s second try at a draft rule acknowledges that it duplicates state regulatory efforts. The text reads:
[S]ome states…have issued their own regulations addressing disclosures and oversight for oil and gas drilling operations.
Operators with leases on Federal lands must comply with both BLM’s regulations and with State operating requirements, including State permitting and notice requirements to the extent they do not conflict with BLM regulations.
In a statement, Independent Petroleum Association of America (IPAA) President and CEO Barry Russell, echoed Harbert:
Unfortunately, the rule solves no existing problem, but creates additional burdens for independent oil and natural gas producers and state regulators. If the Department of Interior believes there are gaps in state regulations of oil and natural gas, they should work with the states to implement changes rather than imposing a costly and burdensome rule on independent producers.
This rule means more red tape and less energy development. It won’t reverse the trend of falling oil and natural gas production on federal lands, and it won’t shorten the average span of 307 days it takes to get an oil and gas drilling permit. In fact, this rule is likely to exacerbate both of these.
The United States is sitting on a lot of coal. If policymakers don’t want it used to generate electricity, we should be able to ship it to countries that want it, right?
Not if you’re anti-energy environmentalists. In the Pacific Northwest, groups like the Sierra Club want to stop the construction of new export facilities in Oregon and Washington that would ship coal from Wyoming and Montana to Asian markets. One of their “anything goes” tactics is launching a frivolous lawsuit against coal and railroad companies over coal dust blowing off trains traveling to ports.
Jeff Ostermayer at Shopfloor links to an op-ed by Roger McClellan, a former chairman of the Environmental Protection Agency’s Clean Air Scientific Advisory Committee who writes that these groups’ legal argument is too simplistic:
Just because a piece of coal is found in the water or coal dust is found near a rail track does not mean humans are exposed to it. Coal is not a substance that breaks down easily. Coal is relatively innocuous. Simply moving it by trains or trucks or barges does not equate to a risk to the environment or human health.
Coal continues to play an important role in meeting energy needs around the world, with steady improvements made in its transport and use. Coal has been transported through the Northwest by rail for decades and there has never been any evidence of harm associated with this rail transport.
In an op-ed in the Bellingham Herald, Mike Elliott, a member of the Brotherhood of Locomotive Engineers and Trainmen, first notes that in his two decades of working on trains he never heard complaints about coal dust from fellow union members. Second, he explains why he supports these exports projects:
We should be supportive of responsible construction projects in the Northwest and follow established procedures for evaluating and permitting those projects. Trying to influence a legitimate process by filing nuisance lawsuits is counterproductive to U.S. industry, job creation and our economy in general.
The middle class of the 1950s and ’60s was, in large part, a blue-collar workforce that built and manufactured right here in the United States. We must remember the importance of these blue-collar jobs, sustain the ones we have and help create more of them.
Responsible projects that meet or exceed today’s environmental standards should not be delayed simply because someone can go down to the courthouse and file a lawsuit.
Judging from their behavior, these groups will use any trick in the book to oppose these export facilities and block the jobs and economic growth that will come from exporting American coal.
Underneath Pennsylvania and New York state runs the Marcellus Shale, a formation rich with natural gas. The two states’ differing policies on the use of hydraulic fracturing, or fracking, to extract natural gas have created a natural economic experiment. In Pennsylvania, hydraulic fracturing is allowed. New York has had a moratorium on fracking since 2010.
In a new study, Manhattan Institute researchers, Diana Furchtgott-Roth and Andrew Gray, examine the outcomes of this stark policy contrast. Analyzing Pennsylvania county data, they conclude:
Pennsylvania counties where hydraulic fracturing takes place have performed better economically on average than those with little or no such drilling.
Specifically, per capita income levels…
Employment effects were more pronounced. The number of jobs…
Furchtgott-Roth and Gray then built a model to estimate how much economic growth New York State counties sitting above the Marcellus Shale missed out on due to the moratorium. Based on this analysis:
[H]ad New York State counties on the Marcellus Shale been allowed to use these resources, economic growth would have been substantially higher—at up to 15 percent for a given four-year period, or 6 percent greater than would otherwise be expected. This corresponds to a potential $8 billion in extra income in upstate New York.
This study offers valuable food for thought for policymakers in New York state, North Carolina, and in other states where fracking technology could be employed. If Pennsylvania is any indication, natural gas development using hydraulic fracturing will reap job and economic growth benefits.
Interior Secretary Sally Jewell just started her new job, but her department already has an important issue concerning hydraulic fracturing, the technology that’s unleashed America’s energy resurgence. The Interior Department plans to issue rules on hydraulic fracturing on federal lands in a few weeks.
In testimony before the Senate Appropriations committee, the former petroleum engineer said that hydraulic fracturing is an “essential” technology. According to The Hill, she added, “It can be done safely and responsibly.”
That’s true, and it’s happened across the country hundreds of thousands of times over the past 50 years. With state-based regulation, hydraulic fracturing has led to levels of oil and natural gas production not seen in decades.
Will Jewell’s praise for hydraulic fracturing turn into good policy? As someone who has actually fracked a well, Jewell knows that hydraulic fracturing is a safe technology. It would be useful for her to review the testimony from state and local officials who testified before the House Natural Resources Committee. She’ll be reminded that states are effectively regulating hydraulic fracturing.
Montana State Senator Alan Olson:
States have successfully regulated more than 1.2 million hydraulic fracturing (HF) operations spanning sixty years; new federal mandates are not necessary given their exemplary safety record. State rules specifically tailored to each state’s unique geologic and hydrologic conditions better protect the environment and groundwater than a one-size-fits-all federal rule.
Lynn D. Helms, Director, North Dakota Industrial Commission, Department of Mineral Resources:
Our oil and gas rules are reviewed at least every two years through a public comment process where every comment must be considered in writing. This ensures that North Dakota regulations keep up with new technologies and economic conditions.
Cindy DeLancey, Executive Director, Wyoming County Commissioners Association:
The Wyoming County Commissioners Association (WCCA) has asked the BLM to defer regulation of hydraulic fracturing to states that have adequate hydraulic fracturing regulations in place, which certainly is Wyoming. Proactive state regulations have the highest likelihood for successful protection of water resources because they are best able to respond to localized impacts and issues, as opposed to a redundant federal hydraulic fracturing rule.
Federal rules would only be duplicative to state regulatory efforts. Plus, adding more rules on energy production won’t reverse the trend of falling oil and natural gas production on federal lands over the last few years.
We need a regulatory environment that takes advantage of America’s energy abundance on federal, state, and private lands. This will lead to increased economic growth and jobs creation.
In what surely must be a conflict of interest (just a smidge), a Rhode Island judge is asking environmental groups to offer suggestions on how best to punish a natural gas company.
Isn't that like asking a vegetarian to judge a barbecue contest? They’re not exactly going to be impartial on the matter.
According to the AP, U.S. District Judge William Smith has taken the unusual step of asking the environmental community for suggestions on how to sentence Southern Union Co. in a way that will have “the broadest possible impact.”
The U.S. Supreme Court struck down an $18 million penalty for a Texas natural gas firm, which means Smith is limited to fining Southern $500,000 or the equivalent in community service. And let's just say he was not happy about that.
"This result is manifestly unsatisfactory and even unjust," Smith wrote in his decision…
Smith also wondered aloud during a hearing on the matter in December whether he could order “higher-ups” at the company to perform community service as punishment.
No word yet on exactly who Smith considers “higher up.”
Comments and suggestions are due to the court within 90 days.