EPA Will Delay Start of Some U.S. Fracking Rules, API Says

Wednesday, 18 April 2012 12:08 PM

(Updates with industry group comment in third paragraph.)

April 18 (Bloomberg) -- U.S. Environmental Protection Agency rules for gas drilling will delay a requirement to capture air pollution at the well until 2015, Howard Feldman, research director of the American Petroleum Institute, said.

A delay in implementing some standards for new gas wells deals with a top demand of the Washington-based group, which represents companies that drill for oil and gas. The EPA, which is scheduled to issue the rules today, rejected a bid by the group to exempt a number of wells from the requirements altogether, he said.

“Overall, EPA has made some important adjustment in the rules that allow” the industry to meet the requirements, Feldman said in an interview. “Most of the changes were constructive.”

The EPA proposed the rule last year to focus on hydraulic fracturing, or fracking, in which millions of gallons of chemically treated water are forced underground to break up rock and free gas. The method has opened up vast new shale gas deposits and helped push natural gas prices to the lowest level in a decade. The original EPA draft would have put the rule into effect in about 60 days.

Lobbyists for companies including Devon Energy Corp. and Chesapeake Energy Corp. sought to delay and scale back the rule to cut emissions from oil and gas wells while refuting environmentalists’ claims that fracking causes air pollution. Methane is the primary constituent of natural gas, and the EPA says it is a contributor to climate change.

Driller Incentives

The EPA rules will include incentives aimed at prodding drillers to use technology called green completions, which collects gas when a well is first tapped, according to David Doniger, policy director for the climate and clean-air program at the Natural Resources Defense Council in Washington.

“I wish there was no phase-in period,” Doniger, who was briefed by the administration, said in an interview. “But this will reward companies that act.”

At the smokestack, power generated from natural gas emits about half the carbon dioxide as coal, earning it favor with some environmental groups worried about climate change. Research on emissions from fracking has prompted questions about whether gas is friendlier to the climate because of methane releases at the well.

Betsaida Alcantara, a spokeswoman for the EPA, declined to provide a comment on the record.

--Editors: Steve Geimann, Jon Morgan

To contact the reporters on this story: Mark Drajem in Washington at mdrajem@bloomberg.net; Jim Efstathiou Jr. in New York at jefstathiou@bloomberg.net

To contact the editors responsible for this story: Steve Geimann at sgeimann@bloomberg.net; Jon Morgan at jmorgan97@bloomberg.net

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