Government Accountability Office (GAO) recently issued two reports identifying challenges in regulating “unconventional” oil and gas development. GAO prepared the reports in response to a congressional request for regulatory, environmental and public health information about the development of oil and gas resources in reservoirs such as shale, tight sandstone and coalbed methane formations. Technological advancements allowing development of these resources include advances in horizontal drilling techniques and hydraulic fracturing.
Titled “Unconventional Oil and Gas Development: Key Environmental and Public Health Requirements,” the first report summarizes GAO’s review of applicable laws and its investigation of regulatory “challenges” but makes no recommendations. It concludes that multiple federal environmental statutes, including the Clean Water Act (CWA) and the Resource Conservation and Recovery Act (RCRA), apply to unconventional reservoirs just as they apply to conventional oil and gas activities. The report observes, however, that limitations and exemptions affect their applicability, citing as an example the exclusion of oil and gas wells from stormwater permitting under the CWA. GAO also reviewed the laws of six states and determined that each imposes its own additional environmental restrictions on the development of unconventional oil and gas reserves.
The report further documents the challenges that federal and state agencies face in regulating development of oil and gas from unconventional reservoirs. In particular, officials claimed that inspection and enforcement are hindered by limited information, such as a lack of data on groundwater quality before drilling, and by legal exclusions, such as the RCRA exemption of wastes from oil and gas exploration and production. Hiring issues further complicate the regulatory process, according to GAO.
The second report, “Information on Shale Resources, Development, and Environmental and Public Health Risks,” notes that the Energy Information Administration (EIA) recently assessed the amount of recoverable shale oil and gas resources in the United States at 482 trillion cubic feet, “an increase of 280 percent from EIA’s 2008 estimate.” Claiming that all oil and gas development poses “inherent environmental and public health risks,” GAO still concludes that the extent of shale oil and gas risks are unknown, in part because existing studies do not account for potential long-term cumulative effects. Included among the potential risks are air quality impacts from vehicle traffic, dieselpowered pumps, flaring or venting of gas, and unintentional emissions due to faulty equipment or impoundments. The report also cites potential water quality impacts as a result of erosion from ground disturbances or from spills or releases at the surface, as well as underground gas and chemical migration.