Fracking Insider Readers: We are pleased to bring you Volume 7 of our State Regulatory Roundup, including updates on Colorado, Pennsylvania, Utah, Texas and Missouri. 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.
Colorado – On November 27, the Colorado Springs City Council passed permitting requirements for oil and gas operations in the city. The regulations include a 1,000 foot setback requirement in densely populated areas.
Colorado has been the site of several publicized battles over whether state oil and gas regulations preempt local regulations and bans. The Colorado Springs City Council issued a report which found that reasonable land use regulations that do not conflict with state rules are permissible.
Pennsylvania – In late October, the Pennsylvania Commonwealth Court ordered the Pennsylvania Utility Commission (PUC) to stop reviewing municipal zoning ordinances that constrain oil and gas development for purposes of determining whether the municipality (or county) qualifies for impact fee proceeds. Pennsylvania collects impact fees ranging from $10,000 to 50,000 per well for distribution to the general treasury and to localities that are “impacted” by oil and gas operations. The state is currently disbursing $204 million in such proceeds.
The Commonwealth Court ordered the ordinance review to cease because the ACT 13 prohibition on local ordinances containing oil and gas operations was found to be unconstitutional. As such, the court found that the PUC had no basis for which to review municipal ordinances.
Utah – On October 24, the Utah Division of Oil, Gas, & Mining promulgated a rule to require oil and gas operators in the state to disclose the amount and identity of the constituents of their hydraulic fracturing fluid. Like many other states, the disclosures are required to be made on the natural gas registry – fracfocus.org. Fracfocus was developed in cooperation with industry and serves as a clearinghouse of state-mandated and voluntarily submitted chemical information for thousands of wells.
Like other state laws, the Utah disclosure law provides exemptions allowing companies to protect confidential business information about precise constituents and mixtures which are proprietary secrets. The rule also provides casing and wellbore integrity guidance, as well as methods for protecting surface water from flowback.
Texas – On September 28, the Texas Railroad Commission (RRC) released draft rules authorizing on-lease, non-commercial recycling of flowback and produced water. The proposal also set siting, lining, and capacity requirements for wastewater storage impoundments at well sites. There are also proposed requirements to ensure the integrity of containers used to transport drilling waste.
Industry has expressed general support for the proposal but want more flexibility to use recycled waters for non-hydraulic fracturing purposes. Industry’s position is that greater flexibility will lead to greater rates of recycling.
Missouri – The hydraulic fracturing boom has reached Missouri in an increasingly significant way. Missouri is home to a massive geologic formation of St. Peter Sandstone, which is used for hydraulic fracturing proppants. This sandstone is made up of grains of sand that are naturally strong and which meet the size and shape requirements needed to hold hydraulically fractured fissures open.
Many environmental groups oppose mining generally, and are particularly concerned about the Missouri mines. Their stated concerns are silicosis risks. In reality, however, their opposition is also likely attributable to their stated opposition to hydraulic fracturing.