House Panel OKs Fracking Chemical Disclosure

SANTA FE, Feb 02, 2013 (Albuquerque Journal - McClatchy-Tribune Information Services via COMTEX) -- An effort to require oil and gas companies to disclose chemicals used in hydraulic fracturing of wells through an online database at least 30 days in advance narrowly passed a House committee Friday, despite opposition from industry leaders.

Hydraulic fracturing, or fracking, is the process of injecting pressurized water, sand and chemicals into an oil or natural gas well to crack rock formations thousands of feet below the surface. Fracking improves flow and volume during extraction and has been a component of oil and gas development in New Mexico for decades.

Citing concerns over the potential for contaminating groundwater supplies with fracking liquids, Rep. Brian Egolf, D-Santa Fe, sponsored legislation that would require oil and gas companies to disclose the chemicals used to frack each new well in New Mexico.

Senate Bill 136 got a favorable recommendation Friday from the House Energy and Natural Resources Committee on a 6-5 party-line vote. The bill will now go to the House Agriculture and Water Resources Committee.

Egolf said the bill is intended to protect residents who don't own mineral rights under their homes and have no say if a lease is issued for an oil and gas company to drill a well on or adjacent to their property.

"Tell me the chemicals you're injecting under my house -- that's it," Egolf said.

Oil and gas companies have pushed back against requests for disclosure of fracking chemicals, saying the ingredients are trade secrets that should be protected. Opponents of the bill say it's is an effort to deter oil and gas development in New Mexico through increased regulation.

"We're requesting proprietary disclosure for a problem that doesn't exist," said House Minority Leader Donald Bratton, a retired petroleum engineer from Hobbs. He said no instances of water contamination caused by fracking in New Mexico have been found.

"We haven't identi f ied there's a problem with hydraulic fracturing ... yet we want to create a regulatory impediment and shut down an industry that fuels the economy of our state and funds education for our kids," Bratton said, noting the royalties the oil and gas industry pays into the state coffers.

Egolf said it's difficult to prove water contamination caused by fracking because landowners can't confirm whether undisclosed chemicals used in a frack match chemicals found in their contaminated water wells.

New Mexico in 2012 implemented a rule requiring oil and gas companies to report the chemicals used in each completed frack, but Egolf says more than 80 percent of those disclosures withhold certain ingredients as "trade secrets." The rule, established by the state Oil Conservation Commission at the request of the New Mexico Oil and Gas Association, does not allow the trade secrets claim to be challenged.

Egolf said that rule doesn't go far enough. "The rule is so favorable to industry that it renders the rule meaningless," he said.

Egolf's bill would expand the disclosure rule by allowing landowners of property where a frack occurred to challenge the trade-secret protection if it's invoked. The bill also would create a searchable online database for the disclosure reports.

Oil and gas companies would be required to alert neighboring landowners of fracking chemicals with a notice sent by mail and published in a local newspaper at least 30 days before a frack occurs under an amendment added to HB 136 on Friday.

New Mexico Oil and Gas Association President Steve Henke called the ongoing effort to add regulations for the oil and gas industry "death by 1,000 cuts." "It's just another opportunity to say, 'You didn't disclose in time, you didn't fully disclose.' It's unnecessary," Henke said of the proposed disclosure rules. "There's not a single case of groundwater contamination in New Mexico, and it's been done tens of thousands of times. So how safe do we want to be " ___ (c)2013 the Albuquerque Journal (Albuquerque, N.M.) Visit the Albuquerque Journal (Albuquerque, N.M.) at www.abqjournal.com Distributed by MCT Information Services

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