Repository for Oil and Gas Energy Research (ROGER)

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This paper investigates the beliefs and framing strategies of interest groups during a period of policy change and the factors explaining policy change. We develop propositions to explore questions concerning policy change primarily from the advocacy coalition framework as well as from other theorie. The propositions are tested by examining the promulgation of a Colorado regulation requiring the disclosure of chemicals used in hydraulic fracturing. Using coded data of documents published by organizations involved in the rulemaking process, we find divergence between industry and environmental groups on their beliefs concerning hydraulic fracturing, as well as their portraying themselves and each other as heroes, victims, and villains, but some convergence on their more specific beliefs concerning disclosure of chemicals. Interviews point to the importance of policy entrepreneurs, timing, a negotiated agreement, and learning for explaining policy change. The findings provide both theoretical and methodological insights into how and why policy changes.

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Advances in directional drilling and hydraulic fracturing have sparked a natural gas boom from shale formations in the United States. Regulators face a rapidly changing industry comprised of hundreds of players, operating tens of thousands of wells across 30 states. They are often constrained in their efforts to respond by budget cuts, a brain drain to industry, regulations designed for conventional gas developments, insufficient information, and deeply polarized debates about hydraulic fracturing and its regulation. As a result, shale gas governance remains a halting patchwork of rules, undermining opportunities to effectively characterize and mitigate development risk. The situation is dynamic, with research and incremental regulatory advances underway. Into this mix, we offer the CO/RE framework ? characterization of risk, optimization of mitigation strategies, regulation, and enforcement ? to design tailored governance strategies. We then apply CO/RE to three types of shale gas risks, to illustrate its potential utility to regulators.

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Intergovernmental responsibility for policy development for shale gas is concentrated primarily at the state level, given multiple statutory and political constraints on potential federal engagement. This opens the question of how a large subset of American states might craft shale policies, amid competing scholarly views on the commitment of states to environmental protection when energy development opportunities arise in the absence of applicable federal authority. The article examines recent trends in state political economy that may shape policy development and capacity, considers the heterogeneous pattern of policy emerging thus far, and draws preliminary lessons from the very small set of states that have enacted far-reaching new state legislation. It also offers early discussion of cross-border issues that may trigger multistate, regional, or ultimately federal engagement as well as growing signs of volatility in policy development in some states.

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Newly accessible shale deposits and other unconventional sources of natural gas have dramatically increased global gas reserves and are regarded as major future energy sources. Shale gas drilling began in Texas and is expanding throughout the U.S. and globally. In Texas and other regions, large population centers overlie these deposits. As a result, city residents increasingly come into contact with extraction activities. The proximity of drilling activities to residential areas raises a number of concerns, including noise, dust and emissions hazards, public safety, diminished quality of life, and effects on neighborhood aesthetics and property values. Cities in Texas address these concerns through setback ordinances that regulate the distance between gas wells and residences, schools, floodplains, etc. Although the state of Texas permits drilling 200 ft (61 m) from residences, many municipalities in the Dallas–Fort Worth Metroplex (DFW) have established longer setback distances. This paper analyzes the purpose and basis for setback distances among 26 municipalities in DFW. Findings show that there is no uniform setback distance, distances have increased over time, and, rather than technically-based, setbacks are political compromises. For policy makers confronted with urban shale gas drilling, deriving setback distances from advanced emissions monitoring could decrease setback distance ambiguity.

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With the encouragement of shale gas production in the United States, governments have considered a range of legislative and regulatory proposals to manage health and environmental damages that may accompany extraction activities. Exceptions adopted by Congress to major federal environmental legislation have meant that individual US states have deemed it necessary to provide oversight through regulations to protect people and safeguard environmental quality. In responding, states have legal structures under which drilling firms may not need to disclose the toxic substances used in fracturing wells. Yet, with increasing numbers of drilling sites, more people are at risk from accidents and exposure to harmful substances used at fractured wells. To provide for meaningful health and safety protection, governments may need to reevaluate legal provisions offering trade secret protection for toxic substances used in fracturing.

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The aim of this work was to evaluate New York State's regulatory program for plugging inactive oil and gas wells. Analysis of reports from the Division of Mineral Resources, Department of Environmental Conservation, reveals that three-fourths of the state's abandoned oil and gas wells were never plugged. Inadequate enforcement efforts have resulted in steady increases of unplugged oil and gas wells abandoned since 1992. Further, no program exists or is proposed to monitor abandoned wells which were plugged. These results strongly suggest that comprehensive reform and increased agency resources would be required to effectively regulate conventional oil and gas development in New York. Industrial expansion into shale oil and gas development should be postponed to avoid adding stress to an already compromised regulatory system.

Abstract:
Hydraulic fracturing is used to extract natural gas from shale formations. The process involves injecting into the ground fracturing fluids that contain thousands of gallons of chemical additives. Companies are not mandated by federal regulations to disclose the identities or quantities of chemicals used during hydraulic fracturing operations on private or public lands. States have begun to regulate hydraulic fracturing fluids by mandating chemical disclosure. These laws have shortcomings including nondisclosure of proprietary or "trade secret" mixtures, insufficient penalties for reporting inaccurate or incomplete information, and timelines that allow for after-the-fact reporting. These limitations leave lawmakers, regulators, public safety officers, and the public uninformed and ill-prepared to anticipate and respond to possible environmental and human health hazards associated with hydraulic fracturing fluids. We explore hydraulic fracturing exemptions from federal regulations, as well as current and future efforts to mandate chemical disclosure at the federal and state level.

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Hydraulic fracturing is an industrial process used to extract fossil fuel reserves that lie deep underground. With the introduction of horizontal drilling, new commercial sources of energy have become available. Wells are drilled and injected with large quantities of water mixed with specially selected chemicals at high pressures that allow petroleum reserves to flow to the surface. While the increased economic activities and the outputs of domestic energy are welcomed, there is growing concern over negative environmental impacts from horizontal drilling in shale formations. The potential for water contamination, land destruction, air pollution, and geologic disruption has raised concerns about the merits of production activities used during extraction. This paper looks at the impacts of horizontal drilling using hydraulic fracturing on water supplies and takes a comprehensive look at legislative and regulatory approaches to mitigate environmental risks in the Marcellus shale region. The overview identifies shortcomings associated with regulatory controls by local and state governments and offers two policy suggestions to better protect waters of the region.

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In response to growing concerns about the impact of shale gas development, Pennsylvania's Act 13 of 2012 established an unconventional gas well fee and required the state's Department of Environmental Protection (DEP) to report on the number of such wells. In this article, we analyze the extent to which the DEP complied with its reporting requirements under Act 13. Using publicly available data, we find that the DEP likely omitted between 15,300 and 25,100 unconventional gas wells from its Act 13 report. Left uncorrected, we estimate that Pennsylvania's state, county, and municipal governments could forfeit fees of $205–$303 million in 2012 and up to $0.75–$1.85 billion cumulatively over the expected life of these wells. Rather than an isolated incident, evidence suggests that information management is a systemic and recurring problem within the DEP and its predecessor agencies. We propose the implementation of a relational database and geographic information system as a way for the DEP to fulfill its Act 13 obligations.

Abstract:
Recent advancements in natural gas extraction (e.g. hydraulic fracturing) have significantly increased natural gas reserves in the United States. Estimates of the technically recoverable natural gas (TRR) in the Marcellus range between 141 trillion cubic feet (TCF) and 489 TCF. However, TRR estimation does not incorporate existing policies, regulations, or land use. We find that approximately 48% of the Marcellus in New York and Pennsylvania is inaccessible given land use patterns and current policy. In New York, approximately 83% of the Marcellus is inaccessible; while in Pennsylvania about 32% of the Marcellus is off limits to drilling. The New York portion of the Marcellus is estimated to have a TRR of between 19.9 TCF and 68.9 TCF. We estimate that 79% of the resource is inaccessible, which results in an accessible resource estimate of between 4.2 TCF and 14.4 TCF. In Pennsylvania, the shale gas TRR is estimated at 86.6–300 TCF. However, we estimate that 31% of the resource is inaccessible, which results in an accessible resource estimate of between 60.0 TCF and 208 TCF.

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Improperly abandoned gas wells threaten human health and safety as well as pollute the air and water. In the next 20 years, tens of thousands of new gas wells will be drilled into the Marcellus, Utica, and Upper Devonian shale formations of Pennsylvania. Pennsylvania currently requires production companies to post a bond to ensure environmental reclamation of abandoned well sites, but the size of the bond covers only a small fraction of the site reclamation costs. The economics of shale gas development favor transfer of assets from large entities to smaller ones. With the assets go the liabilities, and without a mechanism to prevent the new owners from assuming reclamation liabilities beyond their means, the economics favor default on well-plugging and site restoration obligations. Policy options and alternatives to bonding are discussed and evaluated.

Abstract:
The ability to economically produce natural gas from unconventional shale gas reservoirs has been made possible recently through the application of horizontal drilling and hydraulic fracturing. This new technique has radically changed the energy future of the United States. The U.S. has shifted from a waning producer of natural gas to a growing producer. The Energy Information Administration forecasts that by 2035 nearly half of U.S. natural gas will come from shale gas. Texas is a major player in these developments. Of the eight states and coastal areas that account for the bulk of U.S. gas, Texas has the largest proved reserves. Texas' Barnett Shale already produces six percent of the continental U.S.' gas and exploration of Texas' other shale gas regions is just beginning. Shale gas production is highly controversial, in part because of environmental concerns. Some U.S. states have put hydraulic fracturing moratoriums in place because of fear of drinking water contamination. The federal government has gotten involved and some states, like Texas, have accused it of overreaching. The contention over shale gas drilling in the U.S. may be a bellwether for other parts of the world that are now moving forward with their own shale gas production.

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