WASHINGTON (Dow Jones Newswires), July 28, 2011
The Obama administration has proposed the first national air standards for wells that are drilled using a controversial practice known as hydraulic fracturing.
The Environmental Protection Agency announced Thursday it was proposing new rules to reduce the amount of air toxins and smog-forming gases that are released into the air when oil and natural gas is produced.
The rules are expected to reduce cancer risks and help reduce ozone levels in areas where oil and natural-gas production occurs, the EPA said. The standards should also lead to lower emissions of methane, a greenhouse gas that is more than 20 times as potent as carbon dioxide.
A lot of the emissions the EPA has targeted escape into the air when natural-gas wells, drilled using hydraulic fracturing, or fracking, are being prepared for production.
The EPA is proposing to reduce the emissions by requiring the use of special equipment to separate oil and gas from a mix of fracking fluids and water that flows to the surface during one stage of well completion.
Certain states, such as Wyoming and Colorado, already require the use of this equipment.
The EPA says these proposed standards will eventually save the oil and gas industry about $30 million a year. That's because the standards will force companies to collect the hydrocarbons, which they can then sell.
Hydraulic fracturing already receives a lot of scrutiny from lawmakers, regulators and environmental groups because of its possible impacts on drinking water.
The proposed rules announced Thursday would apply to more than 25,000 wells a year, as well as to storage tanks and other pieces of equipment used by the oil and gas industry.
The EPA estimates the proposed rules will reduce smog-forming volatile organic compounds emitted by the oil and gas industry by 25%. They should also reduce methane emissions by 26% and air toxins by nearly 30%.
The EPA undertook this new rule-making after a pair of environmental groups successfully sued the agency to update clean-air standards for the oil and natural-gas industry. The agency is under a court-ordered deadline to finalize the rule by February.
"We are seeing oil and gas development take a tremendous toll on clean air," said Jeremy Nichols, director of the climate and energy program for Wild Earth Guardians. "Our health and environmental safeguards are woefully outdated."
The American Petroleum Institute, a group representing the oil and gas industry, asked the EPA to postpone the finalization of the rules by six months.
"API will review these proposed rules to ensure that they don't inadvertently create unsafe operating conditions, are cost effective and truly provide additional public health benefits," said Howard Feldman, API's director of scientific and regulatory policy.
Copyright (c) 2011 Dow Jones & Company, Inc.
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