Monday, August 29, 2011

Louisiana Likely to Enact Fracturing Disclosure Requirement

Louisiana seems likely to follow Texas and enact a law requiring energy companies to disclose the chemicals used in the hydraulic fracturing process.  But like Texas, the new regulations likely will have big loopholes allowing companies exclusions for trade secrets.

This is a move in the right direction and is a case of the industry taking the initiative before being forced into a regulatory structure by environmentalists and angry legislators.  But because the industry - via the Department of Conservation - seems to be leading the charge, the resulting regulations likely won't be terribly strong.  The trade secret loophole is not unique to Louisiana, as the same language is  used in Texas and Wyoming.  Unfortunately, the loophole is not likely will not help build trust between the energy industry and its critics.

While we in the Haynesville Shale region have largely been spared from the heated battle over hydraulic fracturing, we certainly are the ones living with the process, given that thousands of wells have been fracked in the area over the past several years.  Outside of a few avoidable careless incidents at the surface, there has been no resulting groundwater contamination in the Haynesville Shale.

As I've said in the past, transparency is the first step towards trust.  Nobody is going to feel much sympathy for an energy company, but if people understand that they are designing and building wells so that the groundwater is protected, the mistrust will likely erode (although not disappear entirely).  But it will take time and tangible results.  The industry can pay for all of the glitzy television commercials it wants, but the only way to truly convince people that hydraulic fracturing is safe for groundwater and important to the future of this country is to be forthright in disclosure and strive to develop fluids that are more environmentally friendly.  That and not have an accident!

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