5:00am

Mon December 5, 2011
Environment

Colorado Regulators Mull 'Fracking' Disclosure Rule

At a hearing this morning, Colorado regulators will consider a new rule that would force oil and gas companies to disclose what chemicals they use when hydraulically fracturing wells. The industry uses these chemicals along with a mix of water and sand to “frack” wells deep beneath the earth.  Nearby states like Wyoming and Texas recently put similar “mandatory disclosure” laws on the books and many oil and gas companies have recently come on board with Colorado's proposal.  But some say the rule doesn’t go far enough.

Building Trust

Last summer, Governor John Hickenlooper turned some heads when he made a surprise announcement at the Colorado Oil and Gas Association’s annual meeting in Denver.  The gist?  Companies, he said, should be required to disclose to the public the chemicals they use to frack wells.

"We don’t have to say what the percentages are, but we should say what the components are because that becomes a key part of that trust and this relationship," Hickenlooper said in August.

By trust, the governor was referring to the growing rift between the oil and gas industry and some landowners in once-sleepy suburban neighborhoods that are now seeing an explosion of oil and gas drilling. He later directed the Colorado Oil and Gas Conservation Commission to write a new rule requiring this mandatory disclosure.

"We want to enhance transparency and we want to build public confidence because we are a major oil and gas producing state," said David Neslin, director of the COGCC.

Neslin spent much of the fall overseeing the new rulemaking. He said companies are already required to disclose the information to state regulators, and half of the wells that have been fracked in Colorado this year have been voluntarily reported to an on line public registry

So state officials say little should change for industry once the rule is finalized. 

Tisha Conoly Schuller, president of the Colorado Oil and Gas Association figures as much.

"We support moving forward with a rule that requires disclosure to be mandatory," Schuller said.

'Trade Secret Loophole'

But a growing number of conservation groups are raising heckles over a small exemption written into the current draft rule.  It would allow companies to get around the disclosure if their product is considered to be a trade secret.

"If you ask them to disclose their fracking chemicals and they can just say ‘well that’s a trade secret’ obviously they’re not disclosing their fracking chemicals," said Gary Wockner, of the group Clean Water Action in Fort Collins. "It’s a loop hole and it needs to be fixed."

Environmentalists say this exemption effectively makes the whole rulemaking moot.  Wockner is worried that a ramp up in drilling in heavily populated places like the Front Range could lead to increased pollution and potential groundwater contamination. 

"We need to find out what those chemicals are so that people know what is being used in the wells very near their homes and near their property and near schools," he said.

But regulators argue that a "public disclosure" tool isn't their first line of environmental defense. They say they're focused first and foremost on making sure that a well is properly constructed.

David Neslin of the COGCC also maintains that oil and gas companies rarely apply for a “trade secret” exemption anyway.

"Even if someone claims that a chemical is a trade secret, they still have to report it to us, the state, and they still have to report it to health professionals who require it for diagnosis or treatment of patients," Neslin said.

That was a provision stemming from the last time oil and gas rules were tightened – in 2008. 

Today’s rulemaking hearing likely won’t be the start of a months-long endeavor as the last overhaul was.  Neslin said the commission could vote to approve the draft rule or make more revisions as early as this afternoon.