NC fracking study group tackles disclosure rules

RALEIGH, N.C. — Interest groups hashing out North Carolina’s fracking regulations started work Tuesday by tackling rules on what the public will be told about chemical additives pumped underground and how broad trade secrecy exceptions will be allowed.

The group bringing together oil and gas representatives, state government agencies, environmentalists, and advocates for cities and rural communities started debating what drillers must disclose about chemicals used during the process called hydraulic fracturing, or fracking. The process involves pumping a mixture of water, sand and chemicals to crack open underground shale rock and release natural gas.

The group is pulling together recommended rules for the Mining and Energy Commission, which is to report its proposals to the Legislature for approval. Lawmakers want new regulations in place by October 2014.

Fracking has led to a U.S. energy boom by freeing enormous reserves of natural gas. The work has generated jobs, profits and lowered energy costs. But environmentalists have warned for years that fracking could contaminate groundwater. The problem is that testing underground water supplies for chemicals used in fracking is difficult because they aren’t generally known outside the companies.

The draft disclosure rules would require North Carolina drillers to disclose the chemicals pumped under water and the concentrations in which the chemicals are used. Some states require companies to disclose the chemicals in fracking fluid but not their concentrations. Others require disclosure of some chemicals deemed workplace hazards by the Occupational Safety and Health Administration.

Companies could get months after starting a fracking project before reporting the chemicals.

Operators could withhold disclosing the chemicals used as trade secrets. Landowners or state agencies could challenge that designation within two years, with a court deciding valid secrecy claims. The chemicals data would have to be disclosed both to state officials and, a national website created by two intergovernmental agencies.

The trade secrets provision also used in other states that regulate fracking “is a safety feature for the industry,” said Kat Marciniak, a state Department of Environment and Natural Reserves specialist working on the fracking program. “It’s put in there as a safety feature for the industry. They’ve worked long and hard and spent a lot of money and invested a lot of time into these solutions. They don’t want to disclose it. People are pretty crafty these days. If you give them enough information they can back-engineer it.”

Wyoming was one of the first states to require companies to tell state regulators the ingredients in the chemicals mixed in with that water. But environmentalists say Wyoming regulators have been too ready to allow companies to use the trade secret exception to keep fracking fluid ingredients out of the public realm.

A Wyoming state judge heard arguments Tuesday in a lawsuit that questions state officials’ refusal to publicly release the ingredients in the chemicals.

The North Carolina committee on Tuesday proposed changing the draft disclosure rules to make clear that well operators will be responsible for knowing and reporting chemicals used.

“The responsibility is entirely with the operator to know what he’s putting down the hole,” said Ward Lenz, director of the state Commerce Department office responsible for to encouraging sustainable energy.