Post by melody on Jul 17, 2013 13:41:33 GMT -5
PENN ENVIRONMENT RESEARCH AND POLICY CENTER RELEASES REPORT ON FRACKING COSTS
By Alizah Thornton, PLS Intern
7/16/13
Erika Staaf, clean water advocate from Penn Environment today announced the Penn Environment Research and Policy Center will be releasing a report “Who Pays for Fracking” ( www.pennenvironmentcenter.org/sites/environment/files/reports/Who%20Pays%20the%20Cost%20of%20Fracking.pdf ) as a follow up to “The Costs of Fracking: The Price Tag of Dirty Drilling’s Environmental Damage” report ( www.pennenvironmentcenter.org/sites/environment/files/reports/The%20Costs%20of%20Fracking%20vPA_0.pdf ) released in 2012, which analyzed the financial and economic costs of fracking.
Penn Environment defines fracking to include “impacts resulting from all of the activities needed to bring a well into production,” for example hydraulic fracturing, operating the well and delivering the gas or oil produced from the well to market, Staaf remarked. Staaf stated Fracking is used as an umbrella term because the public and the media know Fracking to be associated with the process of gas and oil extraction.
The 2013 report examines financial assurances for different states as well as Pennsylvania and whether they are appropriate. Staaf stated Penn Environment’s position on fracking operations is that it poses dangers to the public’s environmental health. Staaf stated fracking can contaminate drinking water, cause harm to the health of nearby residences, contribute to global warming and cut in to forest and other landscapes.
The purpose of the report is to advocate and demonstrate that state and federal elected leaders and other officials should require the oil and gas industry to provide “upfront financial assurance” if fracking and drilling are going to continue, Staaf contended. She explained by requiring the companies to provide financial assurance, it may deter some of the “riskiest” practices for extracting oil and gas because the companies would be held fully accountable for any costs in damages.
Staaf stated a number of reasons why the organization said it feels upfront financial assurance is necessary. She remarked current state requirements are inadequate to protect the public, financial assurance is not required for different impacts of fracking, bonding levels are too low, states allow types of financial assurance that does not protect the public and loopholes and exemptions at the federal level and in some states, not Pennsylvania, let the companies “off the hook.”
In the report, Penn Environment offers several recommendations for incorporating financial assurance, Staaf stated. One recommendation is a requirement of broad accountability for fracking-related costs. Examples of potential related costs are compensation to victims, provision of alternative sources drinking water and full restoration to public infrastructures like roads.
A second recommendation is to require levels of financial assurance that are sufficient to protect the public. “The drillers should be required to post financial assurance of at least $250,000 per well to the costs of plugging and reclamation and at least $5 million per well for damage to private property, health, natural resources or environmental cleanup,” Staaf stated. Penn Environment arrived at the numbers from examining other studies and sources that looked at the true cost of Fracking, plugging the well and the after effects, Staaf explained.
Staaf remarked some measure of financial assurance should be required at least 30 years later because of the unknown environmental effects that may end up affecting the public as well. She stated drillers should contribute to “an industry-wide cleanup fund” as a backup source of funds in case financial assurance rules are violated.
The final recommendations are to eliminate loopholes, exemptions and discounts, mainly at the federal level, require forms of assurance that help protect the public and integrate financial assurance rules into a comprehensive system of oil and gas regulation, enforced by the state and federal government, Staaf explained.
Staaf said conducting regular inspections of wells and enforcing the rules are important to the establishment of the financial assurance program.
The report lists suggestions for Pennsylvania, other states and the federal government.
By Alizah Thornton, PLS Intern
7/16/13
Erika Staaf, clean water advocate from Penn Environment today announced the Penn Environment Research and Policy Center will be releasing a report “Who Pays for Fracking” ( www.pennenvironmentcenter.org/sites/environment/files/reports/Who%20Pays%20the%20Cost%20of%20Fracking.pdf ) as a follow up to “The Costs of Fracking: The Price Tag of Dirty Drilling’s Environmental Damage” report ( www.pennenvironmentcenter.org/sites/environment/files/reports/The%20Costs%20of%20Fracking%20vPA_0.pdf ) released in 2012, which analyzed the financial and economic costs of fracking.
Penn Environment defines fracking to include “impacts resulting from all of the activities needed to bring a well into production,” for example hydraulic fracturing, operating the well and delivering the gas or oil produced from the well to market, Staaf remarked. Staaf stated Fracking is used as an umbrella term because the public and the media know Fracking to be associated with the process of gas and oil extraction.
The 2013 report examines financial assurances for different states as well as Pennsylvania and whether they are appropriate. Staaf stated Penn Environment’s position on fracking operations is that it poses dangers to the public’s environmental health. Staaf stated fracking can contaminate drinking water, cause harm to the health of nearby residences, contribute to global warming and cut in to forest and other landscapes.
The purpose of the report is to advocate and demonstrate that state and federal elected leaders and other officials should require the oil and gas industry to provide “upfront financial assurance” if fracking and drilling are going to continue, Staaf contended. She explained by requiring the companies to provide financial assurance, it may deter some of the “riskiest” practices for extracting oil and gas because the companies would be held fully accountable for any costs in damages.
Staaf stated a number of reasons why the organization said it feels upfront financial assurance is necessary. She remarked current state requirements are inadequate to protect the public, financial assurance is not required for different impacts of fracking, bonding levels are too low, states allow types of financial assurance that does not protect the public and loopholes and exemptions at the federal level and in some states, not Pennsylvania, let the companies “off the hook.”
In the report, Penn Environment offers several recommendations for incorporating financial assurance, Staaf stated. One recommendation is a requirement of broad accountability for fracking-related costs. Examples of potential related costs are compensation to victims, provision of alternative sources drinking water and full restoration to public infrastructures like roads.
A second recommendation is to require levels of financial assurance that are sufficient to protect the public. “The drillers should be required to post financial assurance of at least $250,000 per well to the costs of plugging and reclamation and at least $5 million per well for damage to private property, health, natural resources or environmental cleanup,” Staaf stated. Penn Environment arrived at the numbers from examining other studies and sources that looked at the true cost of Fracking, plugging the well and the after effects, Staaf explained.
Staaf remarked some measure of financial assurance should be required at least 30 years later because of the unknown environmental effects that may end up affecting the public as well. She stated drillers should contribute to “an industry-wide cleanup fund” as a backup source of funds in case financial assurance rules are violated.
The final recommendations are to eliminate loopholes, exemptions and discounts, mainly at the federal level, require forms of assurance that help protect the public and integrate financial assurance rules into a comprehensive system of oil and gas regulation, enforced by the state and federal government, Staaf explained.
Staaf said conducting regular inspections of wells and enforcing the rules are important to the establishment of the financial assurance program.
The report lists suggestions for Pennsylvania, other states and the federal government.
