Worst Fracking Regulations in the United States

New York has the worst regulations for oil and gas in the United States. This is self-evident to anyone that is familiar with regulations in other states. The worst gas well setbacks in the nation The setback of a gas well from a land use is a good measure of regulations. The greater the setback, the more protection for the built environment. The DEC’s shale gas well setbacks are worse than any other state or municipal ordinance, as indicated in the following table: DEC House 100 feet State and Local Ordinances Texas MD. ND. Alberta Wyoming N.M. Pa. Texas N.M. Texas N.M. N.M. N.M. Utah 1,0001 1,000 1,640 350 - 5,280 350 1,0002 5003 1,000 7504 1,5005 1,000 750 750 5,280

School Well Stream Pond Historical site Park

150 500 150 0 0 0


State setback of 200 feet is overridden by town ordinances which vary from 600 feet in Fort Worth, 800 feet in Lewisville, to 1,320 feet in Midland. The towns of Flower Mound and Southlake are typical at 1000 feet. 2 Santa Fe County and Valencia County. Arriba County is 650 feet. 3 State setback 4 Santa Fe County 5 Town of Flower Mound 1

Seismic Testing - shot hole distance from buildings, etc. New York has no setbacks for seismic testing, except on state land. Meaning a seismic crew can shoot a shot hole with dynamite anywhere in the state, including next to a daycare center. Needless to say, this is not the case in other states: Montana – 1,320 feet from any building, water well or spring North Dakota – 600 feet from buildings, water wells, springs Wyoming - 1,320 from building or water well Maryland – 500 feet from a building Oklahoma – 200 feet from a water well Arkansas – 200 feet from a residence Louisiana – 1,000 feet from a boat Boats in Louisiana have more protection from seismic testing than do residents of New York. Why are New York’s setbacks either minimal or non-existent ? Because they are merely place-holders for local regulations. The DEC has consistently deferred to local land use ordinances, so, in the absence of such ordinances, the DEC only has token safeguards for surface uses – in the expectation of local ordinances to address the appropriate setbacks. 6 In the absence of such local ordinances, New Yorkers are left with literally the worst protections in the United States from the encroachment of shale gas industrialization. These token setbacks can apply to every building, pond or stream in Upstate. The lesser setback controls – for instance, if a gas well is situated next to a house, and the house’s water well is 400 feet on the opposite side of the house from the gas well, then the 100 foot setback from the house controls. The home owner can be compelled

http://www.scribd.com/doc/63141534/NY-Gas-Well-Zoning 2

to participate in the gas well – since New York has the worst compulsory integration laws in the United States.7 The DEC can set the well spacing at anything it wants – less than 40 acres. So any fracker that has 24 or more acres can compel the neighboring houses into the well. Then drill 100 feet from their door. This would, of course, put their mortgage into default.8 Yet the DEC continues to tell people that their setbacks are based on “science”.9 What is the “science” of a setback of 100 feet from a house that would make the house uninhabitable ?10 Of 150 feet from a daycare center ? Of nothing from a private lake or pond ? There is no “science” involved. No hydrology, no chemistry, no topography, no geology – only political science.11 This leaves New York municipalities no alternative but to zone shale gas wells out of all or portions of their corporate limits.12 That is the appropriate response. “Worst Practices” at the DEC The DEC talks about industry’s “best practices” as if they were tantamount to regulations, which they are not, or a panacea, which they are not. When the DEC’s regulatory practices were audited in 1994, they flunked.13 Part of the problem is that the department that oversees gas drilling has never been adequately staffed. The DEC has never had adequate regulations. The DEC has very few regulations for gas wells. They have avoided making their generic guidelines, the GEIS, into a set of rules and regulations – since they would then have to abide by and enforce those regulations. The worst state tax on shale gas production New York has one of the worst tax regimes on gas production in the country because it has no state tax on gas production, one of only two states in the United States where shale gas production is state
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http://www.scribd.com/doc/74790533/Compulsory-Integration-in-New-York http://www.scribd.com/doc/70784790/Fracking-the-Homestead 9 http://tinyurl.com/Gas-Well-Setbacks 10 http://www.nytimes.com/2011/11/25/us/officials-push-for-clarity-on-oiland-gas-leases.html?_r=2&scp=4&sq=ian%20urbina&st=cse 11 http://www.scribd.com/doc/66390117/SGEIS-Aquifers 12 http://www.scribd.com/doc/65308566/SGEIS-Community-Impacts 13 http://www.scribd.com/doc/76085928/Worst-Practices-at-the-DEC 3

tax exempt at the wellhead. 14 Pennsylvania has recently adopted a state fee on gas wells, leaving New York the only state without one. Absent any direct revenue from gas production, New York has no funds to regulate the activity, no funds to clean up spills, no funds to pay for damages to state roads - which would be substantial. The lack of a state tax at the wellhead leaves New Yorkers uniquely vulnerable to lax enforcement by an understaffed DEC and directly liable for road repairs that otherwise would be borne by the industry. In short, New York has the worst tax regime for shale gas in the country. Fracking apologists point out that New York has a tax on production in the form of its ad valorem tax - a local property tax on gas wells based on their productivity.15 But every other state has an ad valorem property tax on oil and gas wells – based on their productivity. So this is not unique to New York – it is the minimal amount of tax payable on a gas well – and it does not go to fund state costs to roads, repairs or regulation.16 Most states have both a local ad valorem property tax and a state severance production tax. The worst infrastructure New York has effectively no infrastructure to deal with the environmental hazards of shale gas industrialization. For instance, the state has no capacity to safely and economically dispose of the billions of gallons of fracking flowback. Unlike other states, New York has no disposal wells to dispose of the frack waste water. Absent a safe, economic way to get rid of frack water, no horizontal hydrofacking permits should be issued by the state, since the frack water is apt to end up on rural roads or in trout streams.17

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http://www.scribd.com/doc/63145742/NY-Severance-Tax http://www.scribd.com/doc/73207373/Voodoo-Frackonomics-4-0-TheWorcester-Gas-Tax-Hoax 16 http://www.steny.org/usr/Roads/OtherDocs/Gas-Drilling-Impact-onRoads.pdf 17 http://www.scribd.com/doc/65435029/SGEIS-Fracking-Flowback 4

The worst compulsory integration practices New York has one of the worst compulsory integration (CI) laws in the United States.18 Compulsory integration – whereby the state can force landowner’s into a gas well without their consent – is illegal in many states, including Pennsylvania. As practiced by the DEC in New York, compulsory integration has been used to push homeowners into gas wells. Such a practice is unheard of in other states – where compulsory integration is rarely invoked – and never used against homeowners. Such is not the case in New York, where the DEC forces homeowners into wells. 19 New York should either ban compulsory pooling – or amend its law to require a supermajority consent of 70% or more, prohibit CI against home owners, prohibit its use below the natural vertical drainage area of a gas well – 40 acres – and prohibit its use to extend the lateral of a horizontal shale well under adjacent property. 20 The least prepared regulatory agency The DEC has neither the workforce nor the funding to regulate shale gas industrialization. All the DEC can do is prevaricate about how tough its shale gas regulations are. And grossly overstate the prospects for shale gas in the state.21 An activity that the DEC has no ability to adequately regulate, and that the state has no ability to tax. It is clear that the DEC does not thoroughly understand the technical and environmental challenges it faces. 22 The DEC has gone out of its way to understate those challenges and discount the hazards to the point of attempting to discredit sound science.23 This will only perpetuate New York’s abysmal regulations and lead to litigation.

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http://www.scribd.com/doc/73757496/New-York-Compulsory-Integration http://www.propublica.org/article/forced-pooling-when-landowners-cantsay-no-to-drilling/single 20 http://www.scribd.com/doc/69733839/Compulsory-Pooling-of-Shale-Wells 21 http://my.brainshark.com/Voodoo-Frackonomics-663835911 22 http://www.scribd.com/doc/65577477/SGEIS-Well-Construction 23 http://www.scribd.com/doc/73405864/Anomaly-in-the-Duke-MethaneStudy 5

Why is New York the worst ? Why does New York have the worst gas well regulations ? Why is New York the only state without a state tax on gas wells ? Why does New York have the worst compulsory integration law ? Because all of those indulgences have been have been paid for by the gas lobbyists in Albany.24 It is cheaper for the gas industry to bribe elected officials with campaign contributions than to pay a state tax on gas. It’s a bargain. It is easier to find a well location if there are no protections for surface uses. With the possible exception of Pennsylvania, no state has been more thoroughly corrupted by the gas lobby. Conclusions The DEC wrote three iterations of the dSGEIS and the setback of a gas well from a house is still 100 feet - the absolute worst setback of any state or any local ordinance in the United States. Dozens of hearings and thousands of pages of boilerplate from the DEC and the setback for seismic testing is zero. The DEC has been compromised beyond repair. Under the circumstances, the only appropriate recourse left to a city or town is to prohibit shale gas industrialization within its corporate limits. If Albany ever gets its regulatory act together, if the industry ever demonstrates that they can tap shale gas without massively impairing the environment and surface uses, then the town can reconsider its prohibitions. Until then, it would be irresponsible for a New York town to allow shale gas industrialization under current conditions. James L. “Chip” Northrup Cooperstown http://www.scribd.com/northrup49