Latest News: Technology |  Celebrity |  Movies |  Apple |  Cars |  Business |  Sports |  TV Shows |  Geek

Trending

Filed under: News

 

Back Off: 12 Energy State Governors Tell Feds On Hydraulic Fracturing Regs

Dec 20 2013, 10:06am CST | by

10 Updates
Back Off: 12 Energy State Governors Tell Feds On Hydraulic Fracturing Regs
Photo Credit: Forbes
 
 

Comments

Full Story

Back Off: 12 Energy State Governors Tell Feds On Hydraulic Fracturing Regs

Signaling concern that sweeping federal regulations could cripple companies using hydraulic fracturing to extract oil and gas from shale in their states, governors from 12 energy states signed an open letter to energy regulators and policymakers in D.C. last week, urging them to “leave regulation in the capable hands of the states.”

This may be heartening news for energy companies and investors. While most of the letter’s signatories were reliable D.C. critics like Republicans Tom Corbett of Pennsylvania (my former boss), Sean Parnell of Alaska, and Rick Perry of Texas, three of the 12 governors were Democrats: John Hickenlooper of Colorado, Steve Beshear of Kentucky, and Steve Bullock of Montana. It turns out that both red and blue states have benefitted from the energy renaissance, which has been a bright spot in an otherwise slowly growing economy, a source of family-sustaining jobs, and an antidote to U.S. over-dependence on foreign sources of oil and gas.

The letter is the kick-off of a political initiative called States First. It’s a partnership of the Interstate Oil and Gas Compact, a multi-state government agency comprised of 39 states (with international state affiliates) dedicated to the responsible development of oil and gas resources, and the Groundwater Protection Council, a national association of state groundwater protection officials.

The governors say hydraulic fracturing has to be carefully regulated. But, they add, that is already being done, and has been for years—by their state regulators. “State regulatory programs have been at the forefront of oil and gas exploration since 1935,” they write. The governors say the states are doing a good job; a one-size-fits-all federal approach won’t work.

Aided by fracturing, the United States is projected to leap past Russia and Saudi Arabia to become the largest oil and gas producer in the world by 2016, according to the International Energy Agency. That will bolster economic growth, and the governors argue that D.C. should leave the regulation of fracturing to them.

Here is an excerpt from their December 11, 2013 open letter :

The states’ ability to design effective regulations that reflect state-specific needs is a vital element in the resurgence of our nation’s oil and natural gas industry. In fact, thanks to technology and American ingenuity, the United States is on target to become the world’s largest producer of oil and the world’s largest net exporter of natural gas.

In essence, the governors are telling the feds: back off . That is, by the way, exactly what I told Pennsylvania congressman Mike Kelly when he asked me at a congressional hearing a few years ago, “What advice would you give to federal regulators right now [regarding hydraulic fracturing]?” (My response got plenty of media attention.) The governors argue that their states are different in geography, climate, geology, meteorology, and social fabric. State regulators, they explain, are more able to react to changes in technology and more able to design effective regulations that reflect state-specific needs.

The timing of this letter from the group of 12 governors is important. Some environmentalists are clamoring for federalized regulation from inside the D.C. beltway and for the federal government to take away the producing states’ traditional oversight role. And many have called for federal permitting of fracturing projects and thrown their weight behind the Fracturing Responsibility and Awareness of Chemicals Act, or FRAC Act, which is pending in Congress. Basically, it would federalize the regulation of hydraulic fracturing.

That could lead to serious delays. A report from the non-partisan Congressional Research Services issued in March of this year shows that the massive increase in oil and gas production in our country since 2007 comes from state and private lands, whereas production decreased on federal lands. Specifically, natural gas production was up on non-federal lands by 40 percent and down on federal lands by 33 percent. Oil production on federal lands in FY 2011 and FY 2012 was below FY 2007.

Along the way, federal regulators have been caught in some embarrassing missteps on the regulatory front.

In Dimock, Pa., the Environmental Protection Agency (“EPA”) first said the water was safe, then reversed that position, and then reversed it again. The reversals possibly cost taxpayers millions of dollars. In Pavillion, Wyo., the EPA had to abandon its “investigationdue to a laundry list of amateurish scientific errors that was cataloged. In Parker County, Texas, an EPA regional director had to resign after his comments comparing EPA enforcement to the Romans “crucifying” the first five Turkish villagers they saw as a way of making the local population more compliant. The missteps have been ammunition for long-time agency critics like senators James Inhofe and David Vitter, who characterized the EPA as “0 for 3″ when it comes to forays into fracturing.

And just last month, the National Park Service (“NPS”) withdrew a document submitted to Congress objecting to fracturing. It had cited as “scientific evidence” a New York Times op-ed column. Pressed for an explanation, the NPS said that none of its managers had read the document before it was sent to Congress.

What’s an initiative like States First mean? Well, it’s good news for energy sector businesses and investors. Federalizing the regulation of hydraulic fracturing is probably their top business and investment risk. While the federal government has become a black hole for permit applications, the states have been increasing permit review efficiency while providing full environmental protection. For example, in 2012, Pennsylvania launched its comprehensive Permit Decision Guarantee Process , which has increased efficiencies by anywhere from 9 percent to 37 percent, depending on the program, and by 13 percent for the oil and gas program. On the federal side, the average time to process an application for a permit to drill on federal land increased 41 percent from 2006 to 2011—from 218 days in 2006 to 307 in 2011.

Business leaders and investors should pay attention to States First. It appears to be a key bulwark against pressure for the federal government to take an expanded role—one that’s unprecedented, I’m convinced—regulating oil and gas development at the state level.

Michael L. Krancer is Partner & Energy, Petrochemical and Natural Resources Practice Group Leader at Blank Rome LLP and former Secretary of the Pennsylvania Department of Environmental Protection. His blog, Energy Trends Watch , follows developments in energy, petrochemical and natural resources.

Source: Forbes

 

iPad Air Giveaway. Win a free iPad Air.

You Might Also Like

Updates


Sponsored Update

Update: 10

4 Firms In Iskandar Malaysia Get Facilitation Fund Totalling RM16.2 Million

Source: Malaysia Today

MALAYSIA-WEATHER-FLOOD
(Bernama) – Four companies have received the facilitation fund amounting to RM16.2 million from TERAJU@Iskandar Malaysia in an information sharing programme on business opportunities and assista ...
Source: Malaysia Today   Full article at: Malaysia Today 47 minutes ago
 


Advertisement


Update: 9

Selangor’s Watergate about to explode

Source: Malaysia Today

LEBANON-SAMAHA-AZMI BISHARA-ISRAEL
Anwar brought Wan Azmi to meet Khalid to try to resolve this matter. Anwar supports the RM2.5 billion claim but Khalid is stubbornly sticking to the ...
Source: Malaysia Today   Full article at: Malaysia Today 1 day ago, 4:12am CDT
 

More From the Web

Update: 8

GLCs told to provide RM7 billion to develop Bumiputera firms

Source: Malaysia Today

EurAsia Cup presented by DRB-HICOM - Day One
(The Malaysian Insider) – Putrajaya has directed government-linked companies (GLC) to generate RM7 billion in business opportunities for Bumiputera firms this year, Prime Minister Prime Minister Datuk Seri Najib Razak... ...
Source: Malaysia Today   Full article at: Malaysia Today 1 week ago, 2:05am CDT
 

Update: 7

Rafizi shows proof of Putrajaya’s hand in contentious carpet-trader loan

Source: Malaysia Today

Eileen Ng, The Malaysian Insider PKR lawmaker Rafizi Ramli today revealed documents to prove Putrajaya interfered in the RM32 million Bank Rakyat loan to ‎controversial businessman ...
Source: Malaysia Today   Full article at: Malaysia Today Jul 16 2014, 2:16am CDT
 

Update: 6

PAS MP claims Bank Rakyat loaned carpet-trader RM215m, interest free

Source: Malaysia Today

(Malay Mail Online) – Controversial businessman Deepak Jaikishan (pic) was given a whopping RM215 million interest-free loan from state-owned Bank Rakyat, a PAS lawmaker alleged today, despite Putrajaya’s ...
Source: Malaysia Today   Full article at: Malaysia Today Jul 14 2014, 5:52am CDT
 

Update: 5

MRCB, Nusa Gapurna and PKNS settle suit over RM3 billion PJ Sentral project

Source: Malaysia Today

(The Malaysian Insider) – Malaysian Resources Corp Bhd (MRCB), Nusa Gapurna Development Sdn Bhd (NGD) and PKNS Holdings Sdn Bhd have reached an out-of-court settlement over the own ...
Source: Malaysia Today   Full article at: Malaysia Today Jun 21 2014, 2:53am CDT
 

Update: 4

Story behind Syed Mokhtar’s ‘RM2.25 billion tax-exempt’ Bernas deal revealed, says PKR MP

Source: Malaysia Today

(The Malaysian Insider) – An innocuous written reply in Parliament has provided a peek into the cosy relationship between the Najib administration and Malaysia’s best-known businessman, Tan Sri Syed M ...
Source: Malaysia Today   Full article at: Malaysia Today Jun 15 2014, 12:56pm CDT
 

Update: 3

Constitutional monarchy still murky concept

Source: Malaysia Today

After the RM4.5 billion land sale, the Sultan of Johor secured a 15% stake in MOL Access Portal (MOL) for RM396 million and took a 20% stake in Berjaya Times... READ ...
Source: Malaysia Today   Full article at: Malaysia Today Jun 14 2014, 12:37am CDT
 

Update: 2

Sultan of Johor’s RM4.5 bil backlash?

Source: Malaysia Today

"GOLDEN ASIA" Tokyo Premiere Press Conference
Has Sultan Ibrahim of Johor’s succession of big money deals over the last six months caused the tide of public opinion to turn against Johor’s royal palace? KiniBiz examines the... ...
Source: Malaysia Today   Full article at: Malaysia Today Jun 11 2014, 8:49am CDT
 

Update: 1

Putrajaya denies carpet dealer given interest-free loan

Source: Malaysia Today

Eileen Ng, The Malaysian Insider Putrajaya today refuted allegations that Bank Rakyat had allowed carpet dealer Deepak Jaikishan to repay a RM32 million loan without interest following i ...
Source: Malaysia Today   Full article at: Malaysia Today Jun 11 2014, 5:44am CDT
 

Shopping Deals

 
 
 

<a href="/latest_stories/all/all/31" rel="author">Forbes</a>
Forbes is among the most trusted resources for the world's business and investment leaders, providing them the uncompromising commentary, concise analysis, relevant tools and real-time reporting they need to succeed at work, profit from investing and have fun with the rewards of winning.

 

 

Comments

blog comments powered by Disqus

Latest stories

Emma Stone Calls “Game Of Thrones” A “Joke Show”
Emma Stone Calls “Game Of Thrones” A “Joke Show”
Emma Stone thinks that HBO’s hit series “Game Of Thrones” is actually a “joke show”. She prefers “Orange Is The New Black” over “Game Of Thrones”.
 
 
Jessica Chastain Kisses Colin Farrell
Jessica Chastain Kisses Colin Farrell
Jessica Chastain encourages Colin Farrell to seduce her in 'Miss Julie'. See Farrell kissing Chastain i the first trailer of Liv Ullmann’s Miss Julie below.
 
 
Fifty Shades of Grey Trailer is Here
Fifty Shades of Grey Trailer is Here
It is a steamy morning for Fifty Shades of Grey fans. The Fifty Shades of Grey trailer has been released. Watch the sexy trailer below.
 
 
Richard Gere Dating a Brunette
Richard Gere Dating a Brunette
It seems that Richard Gere has stopped dating Padma Lakshmi as he was seen holding hands with a brunette.
 
 
 

About the Geek Mind


Read more about The Geek Mind.