HBW Resources: Ollison Fracking Report

HBW Resources 2211 Norfolk Street, #410, Houston, TX 77098 Tel: 713-337-8810 Web: http://www.hbwresources.com

Natural Gas Well

HBW Resources: Ollison Fracking Report

Below is a summary of activities currently underway at the federal and state levels that could impact the use of hydraulic fracturing for oil and gas extraction. With numerous state legislatures now in session, HBW Resources is monitoring these activities to ensure that responsible and feasible policies based on sound science are advanced.

 Members of the U.S. House of Representatives introduced legislation today to close two of the loopholes that exempt the oil and gas industry from environmental laws. The Breathe Act, HR 1154, introduced by Rep. Jared Polis (D, CO 2) would close a Clean Air Act loophole and the Fresher Act, HR 1175,introduced by Rep. Matthew Cartwright (D, PA 17) would close a Clean Water Act loophole. Specifically, the Breathe Act would repeal a Clean Air Act exemption that allows the oil and gas industry to emit more than its fair share of toxic air pollution. It would also require the industry to control its poisonous emissions of hydrogen sulfide. The Fresher Act would eliminate a Clean Water Act exemption that allows oil and gas to sidestep the same stormwater runoff permitting requirements that other industries meet.

 The City of Fort Collins, CO City Council voted at their March 5, 2013 Council Meeting to approve a ban on hydraulic fracturing within city limits. The vote follows a series of votes dating back to December 18, 2012 when the Council established a moratorium on HF and a vote on February 19 when the Council voted to change the City Code to prohibit the use of hydraulic fracturing and certain storage of waste within the City limits.

 Several bills have been introduced in California that seek to strengthen oversight of hydraulic fracturing. Among the bills are: AB 7 introduced by Assemblyman Bob Wieckowski (D, District 25) would require regulators to adopt rules by Jan. 1 that standardize well construction, public notification prior to fracking and disclosure of chemicals used; SB 4 introduced by Sen. Fran Pavley (D, District 27) proposes adopting state regulations for construction standards and chemical disclosure by Jan 2015; AB 669 introduced by Assemblyman Mark Stone (D, District 29) that proposes that a regional water quality board must approve an operator’s wastewater disposal plan prior to drilling; AB 982 introduced by Assemblyman Das Williams (D, District 37) would require drillers to submit groundwater monitoring plans and detail their water use; SB 395 introduced by Sen. Hannah-Beth Jackson (D, District 19) would require fracking wastewater to be regulated as a hazardous waste through the Department of Toxic Substances Control; SB 665 introduced by Sen. Lois Wolk (D, District 3) seeks to revise the bonding amounts that drillers must post in case a well is later abandoned; and SB 241 introduced by Sen. Noreen Evans (D, District 2) would impose an oil severance tax of 9.9 percent on the value of each barrel of oil produced in California. The revenue would go towards higher education and state parks. At the same time, Governor Jerry Brown (D) came out in favor of allowing hydraulic fracturing to continue in California, saying he’s confident regulators would develop a suite of rules that would allow drillers to tap California’s mineral resources while protecting the environment. A recent report from the University of Southern California stated that developing the Monterrey Shale oil formation would add nearly 3 million jobs and close to $25 billion in tax revenues by 2020.

 Florida State Rep. Ray Rodrigues (R, District 76) introduced a bill, HB 743, Fracturing Chemical Usage Disclosure Act, directing the Department of Environmental Protection to establish an online registry, similar to the one used in Texas, to collect information about chemicals and volumes of water used in the fracking process. The bill was approved unanimously in the Agriculture & Natural Resources Committee. An identical bill, SB 1028, was introduced in the Senate by Sen. Jeff Clemens (D, District 27).

 In response to the support that the proposal, House Bill 2615 introduced by Rep. John E. Bradley (D, District 117), to regulate hydraulic fracturing in Illinois received throughout the state and nationally, a group of environmental and citizens organizations have pushed for a two year moratorium on the process. They support House Bill 3086, introduced by Rep. Deborah Mell (D, District 40) and Rep. Kelly Cassidy (D, District 14), which was assigned to the House Revenue & Finance Committee on March 7, 2013 and Senate Bill 1418, introduced by Sen. Mattie Hunter (D, District 3) and Sen. Iris Martinez (D, District 20).

 In Maryland, HB 1274, “Maryland Hydraulic Fracturing Moratorium and Right to Know Act 2013” was withdrawn after a similar Senate bill, SB 601, was reported unfavorably by the Education, Health and Environmental Affairs Committee. HB 1274 would prohibit the state from issuing a permit for hydraulic fracturing until certain conditions have been met. SB 601 was defeated by a 6-5 vote in committee.

 In Nebraska, Sen. Norman Wallman (District 30) introduced, LB 635, in the Natural Resources Committee. The bill would provide powers and duties regarding hydraulic fracturing to the Nebraska Oil and Gas Conservation Commission, an agency that is to encourage and to promote the development, production and utilization of natural resources in the state in such a manner to prevent waste.

 BLM auctioned off 29 new oil and gas leases totaling 36,000 acres in Elko County, Nevada for a total of $1.27 million. The auction drew the highest BLM bid, $152 per acre, for Nevada oil and gas lease since June 2008. The parcels are in the same part of the state where the first fracking site in the state is likely to be located. BLM is conducting an environmental review of the proposal to drill as many as 20 exploratory wells more than a mile deep on public land in northeastern Nevada.

 New MexicoState Sen. Bill Sharer(R, 1st District) helped defeat a bill, SB 547that would have banned hydraulic fracturing on horizontal wells in New Mexico. Sharer made a motion during a Conservation Committee hearing to table the bill, effectively killing it for the 2013 legislative session. The negativeeconomic impacts of the bill included a roughly 75 percent reduction in FY 2014 bonus monies paid to the state from oil and gas lease bonus sales ($40.5 million); a conservative 10 percent reduction in FY 2014 in royalties paid on current production ($48.3 million); and a conservative 10 percent reduction in FY 2015 royalties paid on current production ($48.7 million).

 The New York Assembly announced hydraulic fracturing moratorium legislation, 5424-A. The bill was introduced by the Chairman of the Committee on Environmental Conservation, Assemblyman Bob Sweeney (D, District 11) and Speaker Sheldon Silver(D, District 65) and was later passed by a 103-40 vote. In his announcement, Speaker Silver stated, “In the interests of

preserving the safety of our drinking water supply and the health of our environment, and absent conclusive scientific evidence that new natural gas drilling technologies such as high-volume hydrofracking pose no threat to public health or safety, the Assembly Majority intends, today, to take up and to pass legislation that would suspend the issuance of certain types of natural gas drilling permits in the State of New York until May 15th of 2015.” The Independent Democratic Conference, which shares control of the New York Senate, announced that they also support a two year ban until an additional health review, the Geisinger Study and two other studies focused on drinking water, are completed. Sen. Dean Skelos, (R, District 9) who is the co-leader of the Senate, stated in press reports that he would block a vote on a bill to extend a ban on fracking.

 The University of Tennessee is seeking approval for a plan to allow natural gas drilling on more than 8,000 acres of public land in East Tennessee’s Morgan and Scott counties. The university’s Institute of Agriculture, which manages the land known as the Cumberland Forest, wants permission to seek bids from energycompanies to lease the oil and gas rights.In return, the university would partner with the company and use the revenue to fund research into how hydraulic fracturing, affects the environment.

For additional information, contact Bo Ollison with HBW Resources. His contact information is below.
Bo Ollison
HBW Resources
2211 Norfolk Street, #410
Houston, TX 77098
Tel: 713-337-8810
E-mail: bollison@hbwresources.com
Web: http://www.hbwresources.com


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