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EPA Releases Final Fracturing Air Rule

by James A. Pardo and Brandon H. Barnes

The U.S. Environmental Protection Agency (EPA) released final regulations on April 17 to reduce certain emissions at hydraulically fractured wells by 95 percent.  The rule, a product of a February 2010 consent decree with WildEarth Guardians and the San Juan Citizens Alliance, adds New Source Performance Standards (NSPS) and amends existing National Emissions Standards for Hazardous Air Pollutants (NESHAPS) for the oil and gas industry.

NSPS Standards

The NSPS standards will reduce by 95 percent volatile organic compound (VOC) emissions during the completion phase of hydraulically fracturing a well.  In addition, although not a regulated substance under NSPS, the new rules have the effect of reducing fugitive methane emissions by 25 percent.  These VOC and methane emissions reductions will be attained by requiring that all newly fractured or refractured wells incorporate reduced emissions controls (RECs).  In total, EPA estimates that the rule will result in reductions of 11,000 tons of Hazardous Air Pollutants (HAPs), 190,000 tons of VOCs, and 1 million tons of methane, with a net benefit of $15 million as a result of the increased profit from captured methane sales. 

The final rule adopts several changes suggested during the public comment period, most important of which is the delayed deadline of  January 1, 2015 for requiring the use of RECs.  While REC technology currently exists, EPA recognized that the number of REC units required to meet the new regulations far exceeds those actually in existence today.  Until then, well operators or owners can achieve specified VOC reductions using flaring or other approved combustion methods. 

The final rule also modifies the definition of "well completions," limiting the REC requirement to that period when fracing operations end and flowback begins.  The requirement remains in effect until the well is either continuously flowing to the flow line or storage vessel for collection (in which case there should be no fugitive emissions) or shut in, whichever occurs first. 

In addition, EPA has exempted low-pressure wells from the REC requirement in response to comments that it is unfeasible to require RECs for low-pressure wells.  For low-pressure wells, as well as wildcat (or exploratory) and delineation wells, which are also exempted from the REC requirement, operators can continue to use flaring to achieve specified reductions.

EPA also has rewarded early adopters of REC technology, and encourages others to join early, by redefining actions that constitute "modifications" triggering NSPS requirements.  Some states require that any source subject to federal NSPS must get a state minor source air permit.  This new definition allows owners and operators of existing wells employing RECs to refracture without changing state permit status, thus avoiding delays and costs associated with the state permitting process.

Finally, but importantly, the rest of EPA’s new rules are not delayed, and take effect 60 days from publication in the Federal Register.

NESHAPS Standards

While EPA adopted many of the comments about the NSPS rules, stakeholders were less successful in obtaining changes to the proposed [...]

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Hydraulic Fracturing: Air Joins Water as Point of Contention

by James A. Pardo and Brandon H. Barnes

The public and regulators alike continue to scrutinize the impact of hydraulic fracturing on water resources – e.g., possible contamination of drinking water; volume of water used; and disposal of used fracing wastewater.  These water issues have dominated the debate for some time, overshadowing concerns that some have raised about potential impacts from an air quality perspective. Recent events, however, indicate that air emissions are likely to become a fracing issue.

On April 3, Henry Waxman (D-CA) and Diana DeGette (D-CO) wrote to Environmental Protection Agency (EPA) Administrator Lisa Jackson asking the agency to consider a recent Colorado School of Public Health (CSPH) study linking air emissions from hydraulic fracturing activities to increased risks of cancer and non-cancer illnesses.  The letter comes one day after EPA delayed publication of final rules for air emissions from oil and gas extraction activities to give itself time to review the more than 156,000 public comments submitted on the draft rules.

The CSPH study found that residents of Battlement Mesa who reside within 1/2 mile of a hydraulically fractured well have an increased risk of contracting illnesses due to volatile organic compounds (VOC) that drilling operations release into the air.  The study methodology and analysis have been criticized by stakeholder groups for using data gathered before enactment of stricter state air standards; for assuming that residents remain in town for 350 days per year, 24 hours per day, thus receiving 24-hour doses; and, for disregarding VOC contributions from local highway traffic.

The study was commissioned by Garfield County in 2010 at the request of Battlement Mesa residents, then decommissioned by the county in May 2011 after questions were raised by the County Department of Public Health.  CSPH scientists continued with the analysis on their own, and are scheduled to publish the results in an upcoming edition of the magazine, Science of the Total Environment.  Garfield County, however, disavows any connection to the study.

Battlement Mesa residents are part of what is widely considered the test case for class actions alleging harm from hydraulic fracturing.  The suit contends that residents have suffered health impacts from air and water contamination as a result of natural gas development at a well pad near the community, and stand to endure further environmental effects and diminution of property value because of plans to drill up to 200 additional wells within town limits..

The CSPH study follows a National Oceanographic and Atmospheric Administration (NOAA ) study on fracing emissions, reported in the Journal of Geophysical Research in February.  The NOAA study concluded that fugitive natural gas emissions from drilling operations ranged from 3 to 5 percent.  These findings were roughly in line with an earlier Howarth (Cornell University) study and were above industry reported levels. Critics of the industry quickly pointed to the study as evidence that fracing is making significant contributions to greenhouse gas emissions, invoking the results as a basis for increased federal regulation.

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