Environmental groups are getting more creative in their efforts to obstruct development as investment in the Utica Shale continues to increase.  On March 14, 2013, the Center for Health, Environment, and Justice and several others, petitioned U.S. EPA to withdraw the Ohio Department of Natural Resources’ (“ODNR”) authority to regulate and enforce Ohio’s Class II Underground Injection Control (“UIC”) program until a full federal audit and investigation of that program has been completed (the “Petition”).

Ohio was granted, by rule, primary enforcement authority over the state’s UIC program in 1983, commonly referred to as “primacy”. Under that program, Class II injection wells are regulated by the Division of Oil and Gas Resources Management (“Division”).  As a practical matter, injection into a Class II well is the only authorized method for the disposal of brine and other wastewater from oil and gas production operations in Ohio.  That includes, for example, more than 12,000,000 barrels of fluid disposed of in Ohio’s Class II injection wells in 2011.  The oil and gas industry cannot, however, dispose of that wastewater carte blanche. Operators of Class II injection wells are required to obtain a permit before accepting any fluid for injection and must adhere to a variety of rules, including significant pressure limits and testing requirements – many of which are substantially more stringent than federal requirements.

Nonetheless, the Petition asserts that the Division has failed to effectively administer and enforce the UIC program, and requests that U.S. EPA withdraw “Ohio’s primacy over the permitting . . .  management and oversight of current Class II wells.”  This could have a significant impact not only on Ohio’s oil and gas industry, but on the industries in surrounding states like West Virginia and Pennsylvania that also use Ohio injection wells for disposal.

U.S. EPA has yet to act on the Petition.  Should it do so, U.S. EPA will likely initiate withdrawal proceedings by notifying Ohio that it has reason to believe that the state is not administering the UIC program in accordance with Safe Drinking Water Act (“SDWA”) requirements.  The adjudication of those proceedings is similar to a formal rulemaking. U.S. EPA is required to publish notice of the withdrawal proceedings and provide interested parties with an opportunity to be heard regarding the adequacy of the state’s UIC program.  We will continue to monitor the Petition’s status at U.S. EPA and report back to you on any developments.