Markey, Waxman, DeGette: Loopholes in Federal Oversight of Oil and Gas Drilling Demand Congressional Action

Oct 9, 2012

The Government Accountability Office (GAO) today released two reports on oil and gas development of shale resources and the utilization of hydraulic fracturing technology.  GAO completed the reports in response to a bicameral request made by Reps. Edward J. Markey, Henry A. Waxman, Diana DeGette, and four other Senators.  These reports come at a time of increased domestic oil and gas production and environmental concerns related to hydraulic fracturing.

“We shouldn’t let chemicals and pollutants seep into the environment due to loopholes in the laws governing oil and gas drilling,” said Rep. Markey, Ranking Member of the Natural Resources Committee. “Regulators have operated with one hand tied behind their back for too long when it comes to the oil and gas industry. Federal officials are limited in their ability to even collect the information necessary for conducting oversight activities. Congress should enact changes to the law that will strengthen oversight of hydraulic fracturing operations, including the disposal of fracturing fluids.  In turn, this will strengthen public confidence in this new source of American energy that we can harness to meet our nation’s future energy needs.”

“EPA and the states share responsibility for ensuring that oil and gas development doesn’t irreparably harm the quality of the air we breathe and the water we drink,” said Rep. Waxman, Ranking Member of the Energy and Commerce Committee.  “To do its job and enforce the law, EPA needs timely and unfettered access to information about oil and gas operations, the chemicals they are using, and their releases to air, land, and water.”

“Over and over again, GAO highlights that shale oil and gas development can pose inherent environmental and public health risks,” said Rep. DeGette, Ranking Member of the Subcommittee on Oversight and Investigations. “Exemptions and limitations make it difficult to determine the extent of those risks. That’s why I introduced the FRAC Act, which allows for chemical disclosure and federal oversight of hydraulic fracturing to ensure that the economic benefits of oil and gas production do not come at the expense of the health and safety of our families and communities.”

The new GAO reports describe the main environmental risks associated with unconventional shale resource development, including risks to air quality, land resources, wildlife, and surface water and groundwater quality.  While many assume that these risks can be mitigated by the Environmental Protection Agency (EPA) using its authority under national environmental laws, the GAO also clearly identifies key exemptions for or limitations in the applicability of these laws to oil and gas development activities that prevent EPA from taking any action.

For example:

• Hydraulic fracturing with fluids other than diesel is exempted from permit requirements under the Safe Drinking Water Act.
• Release of hazardous air pollutants from oil and gas wells and their associated equipment cannot be aggregated and regulated as a major source of air pollution under the Clean Air Act, as typically is done with other industrial stationary sources.
• Typically, EPA requires permits for stormwater discharges at construction sites, which prevents sediment from entering nearby streams. These permits are not required for construction activities on oil and gas well sites.
• The Emergency Planning and Community Right to Know Act established the Toxics Release Inventory (TRI)––a publicly available database containing information about chemical releases from more than 20,000 industrial facilities––but oil and gas operators are not required to report chemical releases under TRI.
• EPA cannot treat oil and gas production wastes as hazardous under the Resource Conservation and Recovery Act.

The GAO report describing shale resources and environmental risks entitled “Information on Shale Resources, Development, and Environmental and Public Health Risks” can be found here.


The GAO report reviewing state and federal laws applying to oil and gas development entitled “Key Environmental and Public Health Requirements” can be found here.

This past summer, the Department of Interior for the first time in more than thirty years proposed regulations for hydraulic fracturing on federal lands.  While acknowledged as an important step in establishing basic safety protections for public health and the environment, Rep. Markey submitted a critique of these rules suggesting several areas for improvement.  Earlier this year, Rep. Markey also released a report detailing oil and gas drilling violations occurring on federal lands.  The report found that Department of Interior inspectors were severely limited in their enforcement actions and restricted in the amount of fines levied against violating companies because of outdated and lenient laws and regulations. In fact, all fines issued to more than 300 companies in 17 states over more than a decade were less than $275,000.

In 2011 an investigation released by Reps. Waxman, Markey, and DeGette found that the fourteen leading oil and gas companies used more than 32 million gallons of unpermitted diesel fuel as a component of their hydraulic fracturing fluid, a violation of the Safe Drinking Water Act.  The use of diesel in hydraulic fracturing fluid is the only component that triggers the need for a permit under this law.