Gas industry promotes own fracking standards despite history of problems

The oil and gas industry's lobbying organization held a workshop in North Carolina last week to promote its own standards as models for how the state might regulate the controversial gas drilling technique known as hydraulic fracturing or "fracking," which involves injecting highly pressurized fluid containing water, sand and chemicals into underground shale rock formations to release natural gas.

But nowhere in their presentations did officials with the American Petroleum Institute acknowledge the environmental damage done in other states despite the industry's standards. Nor did they mention the serious shortcomings documented in API's standards-setting program following the BP oil-spill disaster.

"When you have a best-practices regime, it leaves an enormous amount of wiggle room for failed accountability," said Hope Taylor, executive director of Clean Water for North Carolina, which opposes fracking.

API's workshop took place Feb. 2 at a hotel in Raleigh, where lawmakers are currently considering whether to overturn the state's fracking ban. North Carolina sits atop a major shale formation, and the state is currently studying the potential impacts of natural gas development, with the final report due in May. Meanwhile, in the special legislative session that begins Feb. 16, the Republican-controlled General Assembly may try to override Democratic Gov. Beverly Perdue's veto of legislation that would move the state closer to allowing both fracking and offshore drilling.

The API workshop drew about 100 people, among them elected leaders, state regulators, environmental advocates and representatives of corporations including Marathon Oil, a Houston-based company involved in gas exploration, and Duke Energy of Charlotte, N.C., which is converting some coal-fired power plants to gas.

Bill Weatherspoon of the N.C Petroleum Council, part of API's state network, opened the workshop and served as moderator.

"What we're trying to do today is respond to a lot of our friends who say, 'Bill, we don't have a tradition of oil and gas drilling here, and we need perspective and help,'" he said.

The workshop began with a brief presentation on the geology of North Carolina shale gas by assistant state geologist Ken Taylor. Next up was David Miller, director of API's standards program, who touted the openness of the standards-setting process because it invites input from government, academia and environmental organizations.

The main presenter was Jeff Brami, a retired Exxon Mobil geologist who now heads his own consulting firm in Texas. He discussed in detail a number of API's standards related to fracking, which API distributed to attendees in three-ring binders (in photo). He praised the standards because they are based on science and "don't deal with emotion."

However, neither Brami nor any of the other presenters discussed any of the problems the gas industry has experienced despite API's standards, which include cases of water contamination near fracking sites in Pennsylvania, Colorado, Texas and Wyoming. Neither did they mention the Duke University study that found gas contamination of drinking-water wells near fracking operations, nor the Environmental Protection Agency draft study that concluded contaminated wells near a Wyoming gas drilling site "can be explained by hydraulic fracturing."

But that's not altogether surprising, given that an industry which is a master of denial still denies these findings have anything to do with fracking. For example, the Hydraulic Fracturing Primer on API's website claims that there are "zero confirmed cases of groundwater contamination connected to the fracturing operations in one million wells hydraulically fractured over the last 60 years."

Compromised standards

The damage done by oil drilling is harder to overlook, though, especially since the 2010 BP disaster killed 11 men outright and released 200 million gallons of oil into the Gulf of Mexico off Louisiana's coast. The impact of that spill continues to be felt today, with ongoing environmental damages, economic hardship and health problems suffered by Gulf residents.

The severity of the BP disaster shows the limits of the industry's standards -- a fact noted in the final report of the bipartisan national commission that investigated the spill. The commission concluded that the American Petroleum Institute's standards program was inadequate and had actually gotten in the way of needed safety reforms.

In the early 1990s, for example, the Department of Interior's Minerals Management Service (MMS) -- now the Bureau of Ocean Energy Management, Regulation and Enforcement (BOEMRE) -- was considering a rule requiring all offshore drilling operators to have management plans for safety and environmental risks. But in late 1991, API asked the agency to postpone the rule so it could develop its own offshore safety standard. MMS agreed and took part in API's standards-setting process over the next two years.

API published its "recommended practice" guidance document in May 1993. But, as the oil spill commission noted, the guidance was far from adequate:

Missing from the first edition of the Institute's guideline, however, was a key element of standard process safety management -- nor did it even cover drilling rigs, clearly an integral element in operating offshore.

The commission's report went on to note that API has played a dominant role in setting safety standards for the oil and gas industry -- and that many of these standards have been adopted by the Interior Department. But the commission found that problematic:

Based on this Commission's multiple meetings and discussions with leading members of the oil and gas industry, however, it is clear that API's ability to serve as as a reliable standard-setter for drilling safety is compromised by its role as the industry's principal lobbyist and public policy advocate. Because they would make oil and gas industry operations potentially more costly, API regularly resists agency rulemakings that government regulators believe would make those operations safer, and API favors rulemaking that promote industry autonomy from government oversight.

According to statement made by industry officials to the Commission, API's proffered safety and technical standards were a major casualty of this conflicted role. As described  by one representative, API-proposed safety standards have increasingly failed to reflect "best industry practices" and have instead expressed the "lowest common denominators" -- in other words, a standard that almost all operators could readily achieve.

But at least the API workshop was candid about the industry's focus on cost, with Brami recounting a lesson he imparted to the engineering students with whom he worked.

"I would tell my students Exxon Mobil doesn't care about geology, it doesn't care about chemistry, it doesn't care about physics," he said. "Exxon cares about profit. If you forget that, you'll have a very short career here."