Fracking Insider Readers: We are pleased to bring you Volume 21 of our State Regulatory Roundup, including updates in California, Michigan, and Pennsylvania. As we explained in earlier volumes, we designed the Roundup to provide quick overviews on state regulatory activity. If you have any questions on any of these summaries, please do not hesitate to ask.

California – Here is a quick update on some of the more significant hydraulic fracturing-related legislative efforts mentioned in the State Regulatory Roundup Vol. 19:

  • SB 4: would require disclosure of different types of company data, including disclosure of the constituents of hydraulic fracturing fluid. This bill passed in the Senate on May 29th and has been sent to the Assembly floor for discussion. Of the various bills to regulate hydraulic fracturing, SB 4 is seen by many advocates of stricter controls to have the best chance of passage.
  • AB 288: would require 30 days’ notice to the state before a well could be hydraulically fractured. Would also require the State Oil and Gas Supervisor to supervise drilling, operation, maintenance, and abandonment of wells. Amendments made by the Appropriations Committee in late May substantially altered the bill, and it no longer required 30 days’ notice to the state before a well could be hydraulically fractured. This bill was defeated on the Assembly floor on May 30th. The bill was moved to the inactive file and no further consideration is expected.
  • AB 1323: would have placed a moratorium on hydraulic fracturing until a thorough new study could be conducted on the environmental and public safety impacts of the technique. This bill was defeated on the Assembly floor May 30.
  • AB 7: would require oil and gas operators to provide lists of every chemical used in hydraulic fracturing operations and provide separate justification for each trade secret claim. Also would require details about maximum concentrations and purposes of chemicals used, amount and type of water used, disposition of fluid used in hydraulic fracturing once the process is complete, baseline groundwater monitoring, pre-notification to regulators and landowners within 1,500 feet of wellhead, and wastewater discharge reporting. The bill failed to clear the Assembly’s Natural Resources committee with the necessary five votes on June 12th.
  • AB 669: would regulate the use and disposal of fresh water in hydraulic fracturing operations. This bill was also defeated on the Assembly floor last week.

Michigan – The Committee to Ban Fracking in Michigan (CBFM) filed a challenge to the approval of two natural gas pipeline applications for northern Michigan in May, and announced a ballot initiative to ban horizontal fracturing in the state. The CBFM challenged the pipeline applications on the grounds that drilling in Northern Michigan would disturb protected wildlife habitats and industrialize the area.  However, the Michigan Public Service Commission (MPSC) denied the petition last month for lack of standing.  In an attempt to reduce the number of challenges in the future and to defend itself against the possible ballot initiative, the MPSC has been scheduling regular information sessions on the safe development of oil and gas resources. Environmentalist challenges to natural gas pipeline permits have increased in frequency as groups that oppose hydraulic fracturing try to sever wells that have been, or will be, hydraulically fractured, from markets.

Pennsylvania – The Clean Air Council has filed a 60-day notice of intent to sue over the Pennsylvania Department of Environmental Protection’s interpretation of “interdependency” for purposes of determining whether the emissions from separate wells or facilities should be aggregated under the Clean Air Act (“CAA”). Aggregation is an important issue because emissions from individual wells or components of natural gas infrastructure are often too low to trigger CAA permitting thresholds. Aggregating them together, however, can cause a well system to trigger CAA permitting. PADEP interpreted the “interdependency” element of the aggregation test to contain a rebuttable presumption that “facilities” over a quarter mile apart are not interdependent. PADEP has defended its interpretation as consistent with the CAA and analogous prior determinations.