Wednesday, November 10, 2010

Halliburton and Cabot Oil & Gas feel effects of hydraulic fracturing

The U.S. Environmental Protection Agency subpoenaed Halliburton for information about its hydraulic fracturing formula after the company failed to comply with EPA's prior request for information. "In September, the EPA had asked nine companies that practice hydraulic fracturing, or fracking, to reveal the mix of chemicals they use in the practice which is opposed by environmental groups worried about its effect on drinking water," Timothy Gardner of Reuters reports. "All but Halliburton provided the necessary information, the EPA said." EPA plans to use the data in its comprehensive fracking study.

"EPA is slated to release preliminary results of the study, commissioned by Congress, by the end of 2012," Gardner writes. Halliburton said it is working with EPA to supply the information and had already handed over at least 5,000 pages of documents as of last week. A company spokesperson said Halliburton "was meeting with the EPA 'in order to help narrow the focus of their unreasonable demands' that could require them to prepare about 50,000 spreadsheets," Gardner writes. (Read more) In October, Halliburton announced it planned to make the list of chemicals it used in fracking available on a public website on Nov. 15, Casey Wooten of the Houston Business Journal reported.

Cabot Oil & Gas Co. has been assessed a $12 million fee to provide municipal water service to 18 rural residents whose water wells were contaminated by the company's drilling activities in Marcellus Shale, reports Environment and Energy Daily. The Pennsylvania Department of Environmental Protection has evidence linking the company drilling to the contamination and has proposed connecting the residents to the water main from the nearest town. Cabot would be required to pay the $12 million cost, which breaks down to more than $650,000 per resident. (Read more, subscription required)

Andrew Maykuth of the Philadelphia Inquirer also reported on the Cabot Oil & Gas decision, explaining the political circumstances surrounding the decision. Pennsylvania DEP Secretary John Hanger and Cabot have "been locked in an increasingly hostile public battle over responsibility for the contamination of the water wells in Dimock Township, which has become an icon for anti-drilling activists," Maykuth writes.

"Cabot may not be concerned about its reputation, but there's been a huge damage to Pennsylvania's reputation throughout the world," Hanger told Maykuth. Cabot spokesman George Stark countered the company maintains its drilling did not contaminate the Dimock wells, but the company was willing to pay for less expensive remedies including individual well-water treatment systems. Hanger said DEP had assembled an "overwhelming case" implicating Cabot in the contamination. "There is no ideal solution," he said. "The only ideal situation would have been had the contamination not occurred in the first place." (Read more)

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