By Dan Kish
Oil and natural gas production in the United States is booming at historic levels thanks to development on private and state lands. Unfortunately, lands owned and regulated by the federal government have yielded lower production numbers in recent years. Now, the Obama Administration is trying to impose around the country the same type of regulatory foot-dragging that led to federal land energy production decreases.
In the last five years, oil production increased 47 percent and natural gas production increased 16 percent. According to the Congressional Research Service, all of the increased production over the past 5 years took place on private and state land. The reason? Production on federal land is bogged down by red tape, regulatory uncertainties and restricted access to energy resources.
On private and state lands, state regulators oversee the oil and natural gas drilling that is largely responsible for U.S. production increases. But Washington bureaucrats are increasingly eager to expand their oversight power to include hydraulic fracturing. Both the Department of Interior and Environmental Protection Agency are preparing to roll out a new slate of rules aimed at duplicative regulation of hydraulic fracturing.
Fortunately, state officials are fighting back against the Obama Administration’s attempt to take over oil and gas regulation. Last month, 20 different state chambers of commerce sent a letter to EPA Administrator Gina McCarthy arguing that the regulation of hydraulic fracturing should be left to each individual state.
“Our nation’s citizens and business have benefitted from the oil and gas boom associated with the shale plays across the country — all under the regulatory eyes of their state’s Department of Natural Resources or Environmental Protection Agency,” the letter says in part. “No one knows the local geology, land and water better than state agency staff, and there is no doubt that different states have different areas of focus when it comes to regulating hydraulic fracturing.”
Those business groups aren’t alone. Lawmakers on Capitol Hill from both parties are also realizing when it comes to drilling for oil and gas, locals know best.
In August, North Dakota’s bipartisan congressional delegation called on the Interior Department to put federal regulations on hold and instead, defer to the state’s pre-existing rules.
“We request that the [Interior Department] final rule on hydraulic fracturing exempt North Dakota and Indian lands in our state…and recognize that primacy of states to develop the criteria, oversee [implementation], and ensure compliance with state-developed regulations,” the letter reads.
Members of the Wyoming congressional delegation, which includes Representative Cynthia Lummis and Senators John Barrasso and Mike Enzi, also asked the Department of Interior to exempt from federal rules any state with current hydraulic regulations on the books. Duplicative rules, they argued, could deter companies from even trying to drill on federal lands that provide tremendous economic benefit and jobs to the people of energy-rich states like Wyoming.
State-based hydraulic fracturing regulations have been effective and safe for more than 60 years. Both the former and current administrators of the Environmental Protection Agency have testified under oath that there has never been a confirmed case of groundwater contamination due to hydraulic fracturing.
The boom in oil and natural gas production is creating tens of thousands of jobs. The U.S. Energy Information Administration (EIA) recently reported that between 2007 and 2012, the number of new jobs in the oil and gas industry increased 40 percent. And according to a story by IHS CERA Consulting, direct and indirect jobs created by the natural gas boom are expected to hit 3.9 million by 2025.
If that weren’t enough, earlier this month, the EIA announced the U.S. is on track to become the largest producer of petroleum and natural gas this year, surpassing even Saudi Arabia. None of this would be possible without the safe use of innovative, homegrown technologies and the effective regulation of those technologies by state regulators who are best equipped to monitor them.
The massive increase in oil and natural gas production was accomplished without federal intervention from Washington. State regulators should be able to continue doing their jobs — like they have for decades — so that Americans can continue to benefit from the energy boom that is happening despite the bad policies coming from Washington.
The oil and gas are out in the country; the dipsticks are in Washington.
Dan Kish is a senior vice president for policy at the Institute for Energy Research. Over 25 years, he has served on congressional committees related to energy policies and, for six years, served as chief of staff for republicans of the House Resources Committee.