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DENVER--Enforcement data from six states show that more than half of all oil and gas wells in those states go uninspected, and monetary penalties for regulatory noncompliance amount to less than the value of one well, according to a Sept. 25 report by the environmental group Earthworks.
The report, based on research conducted in Colorado, New Mexico, New York, Ohio, Pennsylvania, and Texas, concluded the states do not sufficiently enforce their existing oil and gas rules. “Based on their own data, every state we studied fails to adequately enforce regulations on the books,” the group said.
The report, Breaking All the Rules: The Crisis in Oil and Gas Enforcement, addressed systemic factors impeding enforcement in the six states and made recommendations to fix the problem.
Joining Earthworks in releasing the report were the grassroots group 350.org, the Clean Air Council, the Clean Water Action, Food & Water Watch, Oil Change International, and the Sierra Club.
“Across the country, public health and safety are at risk because states are failing to uphold the rule of law,” said Bruce Baizel, senior staff attorney for Earthworks. Until states can guarantee they are adequately enforcing their rules, oil and gas agencies must not permit new drilling, he said.
Steve Everley, spokesman for Energy in Depth, an oil and gas industry group, said Earthworks and the other groups did not release the report to “fix” state regulation, as claimed.
“It's difficult to take serious any report proclaiming guilty until proven innocent as its central recommendation,” he said. He noted the report recommended changing state regulations to “reduce the burden of proof that must be met before agencies can take enforcement action” against oil and gas operators found in violation of rules.
The report also observed that state agencies will not be able fully to use their enforcement tools until there is a “shift of burden of proof requiring industry to prove that they have not caused harm,” Everley said.
“Unfortunately, the only hope for credibility for some groups is to shift the burden of proof away from their own false claims and onto the industry they so desperately want to shut down,” he said.
The report said states are not seeking, documenting, sanctioning, deterring, or cleaning up problems associated with oil and gas operations, including problems such as chemical spills, equipment failures, accidents, and discharges into drinking water supplies.
Among the report's findings:
• Some 53 percent to 91 percent of the wells in the states studied are operating with no inspections every year to determine whether they are in compliance with state rules;
• When inspections do uncover violations, the violations often are not recorded formally. The decision whether to record a violation often is left to the discretion of an individual inspector;
• Few penalties are assessed when violations are recorded; and
• When penalties are assessed, they provide little incentive for companies not to violate the rule again.
No state assessed annual fines that added up to the average value of a single gas well, about $2.9 million, the report said.
“States are dangerously unprepared to oversee current levels of extraction, let alone increased drilling activity from the shale boom,” the report said.
Much of the information in the report comes from studies conducted earlier of the various states. Colorado, for example, was criticized by Earthworks in March for having an inadequate inspection capacity and for not consistently assessing violations, among other flaws.
Todd Hartman, spokesman for the Colorado Department of Natural Resources, defended the state as having “one of the strongest, most robust set of oil and gas regulations in the country, rules that other states have turned to as a model for sound oversight of drilling, hydraulic fracturing, and other aspects of oil and gas production.”
He noted the state is in the midst of a stakeholder process to evaluate potential changes to its setback rules and baseline water quality sampling protocols.
By Tripp Baltz
The report, Breaking All the Rules: The Crisis in Oil and Gas Enforcement, and related documents are available at http://www.earthworksaction.org/issues/detail/oil_gas_enforcement.
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