Fracking critics praise new NEB rules for the North, Though chemical disclosure stays voluntary, requirements on human error could render projects economically unviable, says consultant by Meagan Wohlberg, September 23, 2013, Northern Journal
Companies are required to begin following the new filing requirements immediately when applying for drilling operations that use hydraulic fracturing, a process by which water and chemicals are pumped at high pressure into the underground shale bed to force oil and gas to the surface. “I think the NEB has come forward and done the right thing. I also think this is going to set an extremely interesting precedent for the rest of the country because the provinces do not require this,” said Jessica Ernst, an oil patch consultant currently involved in a lawsuit against the Alberta government and EnCana Resources for allegedly polluting groundwater through fracking. According to Ernst, who has 30 years of experience making applications to regulators including the NEB, the new requirements will likely pose a huge compliance challenge, both technically and financially, for companies.
Though the NEB does not request details on the types and toxicity of fracking chemicals being injected, nor the disclosure of chemicals used for drilling, perforating, acidizing, cementing or servicing, only asking companies to “describe the design basis for the selection of the fracturing fluids and chemical additives,” Ernst said other requirements could render projects uneconomical.
“I think it’s going to be difficult for the company, and if they hired me, I would take on the task but I would take a deep gulp and tell them this will be the most challenging NEB project I’ve ever done,” she said.
Ernst said her main criticism of the NEB announcement is that it only impacts the territories and yet misleads all Canadians into thinking that these requirements cover provincial jurisdictions. Though the NEB does not have a mandate to make the filing requirements legal for the rest of Canada, she said it could easily have suggested these guidelines, which far overshadow the list of seven best practices from the Canadian Association of Petroleum Producers (CAPP) industry lobby group currently being adopted across the board, as the bare minimum for fracking in Canada.
Requirements similar to environmental assessment Companies who balked at the idea of an environmental assessment (EA), such as MGM Energy – which withdrew its application to do exploratory fracking in the Sahtu after it was referred by the review board to the assessment process – and ConocoPhillips, whose winter drilling project bypassed the assessment altogether, will now be expected to fulfill requirements markedly similar to a full EA. Developers are now also asked to perform socioeconomic assessments of their projects before moving forward as a filing requirement.
Some of the more challenging rules, Ernst said, are those forcing companies to adequately “measure, record, sample and analyze” chemical-laden flowback fluids – those that return to the surface after each frac – and to “describe the procedures for the selection, evaluation and use of chemical substances.” But Ernst said it is the new array of rules asking companies to prove they are capable both financially and in terms of human resources to properly manage fracking projects, both on a day-to-day basis and in case of emergencies, that poses the greatest challenge to developers. The NEB now requires applicants to demonstrate that “human error” has been taken into consideration by the management system. “The human performance challenges would be things like the drugs, the drinking, the stress, being away from home…so you have less than perfect workmanship happening,” Ernst said.
“The human factor is when you have a truck going over the bridge, or you have a greedy company making the workers work too hard, so they make it physically impossible for a trucker to take the waste to a waste disposal well so when no one’s looking they dump it into a creek. Those are human factors, and that is a massive challenge. That’s the one that would scare me the most, if I was hired to do this for a company.” More so, Ernst said, the filing requirements are tough enough that they will almost certainly be met with requests for more information from the NEB, which could bring up further challenges, since the board has made clear the rules are susceptible to change as more information emerges.
New rules sparked by public concern
The NEB’s announcement comes on the heels of a wave of public concern over a clause in the water license issued for the territory’s first horizontal fracking project, which allows the developer, ConocoPhillips, to withhold “trade secrets” from the list of chemicals it’s required to disclose. Following an investigation by Northern Journal into proprietary rights on frac fluids, the NWT Chapter of Council of Canadians raised the alarm at the territorial level, calling for an internal investigation by the GNWT under the Environmental Rights Act. According to NEB chair Gaetan Caron, those concerns are being taken seriously and are the backing for the new filing requirements. He said the NEB is working alongside the GNWT in shaping fracking best practices for the territory. “We are thinking of how to move toward more transparency, how to balance public concern and private interests,” Caron told The Journal in an interview earlier this month. Within the new requirements, companies are asked if they are “willing” to disclose the chemicals used in the fracking process. While some, including Ernst, have criticized the decision to keep disclosure voluntary, she said the tactic employed by the NEB could actually be an effective and calculated accountability mechanism. “What if the applicant says no? The NEB will maybe say, well we’re going to disallow you,” she said.
The board has indicated that companies seeking to frack in the Sahtu area of the NWT have already pledged full disclosure of chemicals to be used in the fracking process despite having the legal right to keep that information private. Co-chair of the Council of Canadians’ NWT chapter Peter Redvers said he is glad to see movement towards more transparency, but continues to wait for the results of the GNWT’s investigation under the Environmental Rights Act. “It’s good to see that there is some movement on this, at least in terms of the transparency issue. That’s step one: getting the transparency for the public to have as good an understanding as possible as to what it is that’s being used…and how much of that is recovered and how much of it is left under the ground,” Redvers told The Journal. “The next question, of course, is what are the environmental impacts of that? Certainly those questions will have to be addressed, as well, and the hope would be that this decision by the Sahtu board to issue this permit without an environmental assessment would be reconsidered,” he added. [Emphasis added]
Slide from Welcome Home to a “Natural Drilling Platform” by Jessica Ernst at the People’s Forum, September 22, 2013, Stephenville, Newfoundland