U.S. Fracking Regulations Upset Oil Industry

Written By Jason Stutman

Posted May 22, 2013

To those of us who have been following the shale boom, the following information shouldn’t be too much of a surprise.

Wherever there is a large enough public debate, there is also the nose of the government. Washington loves playing mediator – it’s a good look for them.

The U.S. Interior Department aims to implement new regulations for hydraulic fracturing (what a shocker). The new regulations surround concerns over the environmental safety of fracking and target several specific issues.

According to the proposal, companies must share a list of fracking chemicals, but they are permitted to do so after fracturing has already been completed. Companies may also withhold information if they consider it to be a “trade-secret”.

The regulation also sets forth standards for well construction and proper water and waste disposal. It would not require baseline monitoring of local water sources before and after fracking.

Simply put, this regulation changes almost nothing. It will be difficult to argue against companies’ claims of proprietary information, and any sharing of information will be an afterthought.

Perhaps even less stunning than a “change” in fracking regulation is the reactionary bitterness coming from both environmentalists and Big Oil. Somehow, the regulations are not stringent enough while simultaneously being too rigid. It’s striking – the difference in view that two pairs of eyes can see.

Fracking is executed by driving a highly pressurized mix of water, chemicals, and sand underground to open fissures in rock, a process resulting in the release of natural gas which is then brought to the surface. The major concern here for environmentalists is the concern over contamination.

As of now, companies drilling on federal land do not have to disclose the mix of chemicals used in fracking projects. However, this new regulation would require full disclosure of any chemicals being used, information which would be stored within an on-line database.

Of course, some argue that producers don’t reveal their chemical mixtures due to trade secrets, and it has nothing to do with “hiding” anything.

The fact is, neither side tends to be particularly truthful when it comes to these kinds of things. But either way, it doesn’t really matter.

The bottom line is that the fracking boom will continue moving forward, with or without the introduction of the newly proposed regulations.

With natural gas proponent Ernest Moniz moving in as Secretary of Energy, there is a clear message that shale growth will remain unhindered by policy. And thanks to the development of multi-well pad drilling, production is likely to continue well throughout the next few decades.

In fact, for environmentalists, one thing to consider is that on land, multi-well drilling is more efficient and eco-friendly than competing methods.

That’s right, the technology consumes less land than traditional, single-well drilling. It even allows for the land to recover to it’s original state!

Multi-well pad sites for shale production can be converted back into grassy farmland too.

Of course, the biggest advantage to multi-well pad drilling is the opportunity it presents for the United States to kick OPEC to the curb. In fact, some are actually calling for multi-well pad drilling to sink OPEC. You can read more about that here.


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