The U.S. Department of Justice is sponsoring a two-day law enforcement conference this week in State College, Pa., on the Marcellus Shale. The purpose is to educate local law enforcement in Pennsylvania on environmental and other crimes specific to the Marcellus Shale. The conference is open only to law enforcement and prosecutors. It is supported by the U.S. Environmental Protection Agency (EPA) Criminal Investigations Division, the FBI, the Pennsylvania Office of Attorney General and other federal and state law enforcement agencies. Scheduled speakers include Peter J. Smith, the U.S. Attorney for the Middle District of Pennsylvania, and Ignacia Moreno, the Assistant Attorney General in charge of the Environment and Natural Resources Division of the Justice Department. The high level speakers and extensive resources devoted to the conference reflect the very high priority being placed by government authorities on environmental and other criminal enforcement related to the Marcellus Shale.
Background
Drilling for natural gas in Pennsylvania's section of the Marcellus Shale offers an important source of economic prosperity as well as a prime area for environmental regulation. Questions have been raised about whether civil and administrative enforcement efforts by state and federal regulators will be sufficient to respond to safety and environmental concerns. Against that backdrop, criminal law enforcement agencies are acting aggressively to increase their focus on environmental crimes associated with natural gas extraction. Businesses drilling within the Marcellus Shale, or providing services to those that do, should take a careful look at their existing policies and procedures to ensure compliance with the law.
Hydraulic fracturing, or "fracking," for natural gas that is trapped several thousand feet below the surface of the geological formation known as the Marcellus Shale represents a rapidly growing segment of Pennsylvania's economy. Nearly 195 billion cubic feet of natural gas were recovered from the shale between July 2009 and June 2010, and some estimates predict that number to more than double by 2015. Moreover, in a struggling economy, the fracking industry has brought tens of thousands of jobs to the state and serves the salutary function of reducing the nation's dependence on foreign oil.
From the environmental standpoint, natural gas has the advantage of being a cleaner source of energy than coal. Nonetheless, environmental organizations have expressed concerns over the fracking process. There are fears that the process contributes to greenhouse gas emissions and withdraws excessive quantities of water from the local water system. Major concerns center on the possibility that the chemicals used in, and released by, the fracking process might contaminate drinking water supplies. On May 9, a study published by Duke University researchers found that there are high levels of methane contamination in drinking water wells near shale gas drilling sites. (S. Osborn, A. Vengosh, N. Warner & R. Jackson, "Methane contamination of drinking water accompanying gas-well drilling and hydraulic fracturing," www.pnas.org/cgi/doi/10.1073/pnas.1100682108.) Academic research in this area is just beginning, and future studies are sure to follow.
Regulatory Limitations
There are significant legal impediments to civil enforcement in this area. For example, although the EPA generally regulates subsurface fluid injections under the Safe Drinking Water Act (SDWA), the agency lacks authority to regulate fracking related to gas production effectuated by the injection of fluids (other than diesel fuels). This is a result of an exclusion to the definition of "underground injection" in the SDWA. (42 U.S.C. §300h(d).) Such legal constraints have led EPA to rely at least in part on indirect regulation, which it has pursued by pressuring state agencies, such as the Pennsylvania Department of Environmental Protection, to engage in or require more rigorous water sampling for fracking-related pollutants and to reopen the National Pollutant Discharge Elimination System permits of treatment facilities that are accepting gas drilling wastewater.
Environmental Crimes Enforcement
To further strengthen the government's response, state and federal law enforcement agencies have turned their collective attention to the Marcellus Shale. Criminal investigations and prosecutions have been initiated and are ongoing. Recently, for example, the Pennsylvania Office of Attorney General filed numerous criminal counts against a waste hauler and his company for allegedly directing employees to dump millions of gallons of wastewater from natural gas drilling into streams and mine shafts. Activities of interest to law enforcement besides illegal disposal of wastewater include the obstruction of navigable waterways and construction in protected wetlands.
As evidence of the ever-increasing role of criminal enforcement in the Marcellus Shale, the U.S. Department of Justice, including the three U.S. Attorneys in Pennsylvania and the Justice Department's Environment and Natural Resources Division, is hosting this week's two-day conference to focus on environmental crimes, including wetlands and other water-related violations, financial crimes, commercial vehicle violations, and other crimes of interest to federal, state and local law enforcement. Participating law enforcement agencies include the Justice Department, EPA-CID, FBI, IRS, Pennsylvania Office of the Attorney General, Pennsylvania State Police, Pennsylvania Chiefs of Police Association, U.S. DOT Inspector General, U.S. Fish and Wildlife Service, and the Middle Atlantic-Great Lakes Organized Crime Law Enforcement Network. This broad list of hosts and supporters is indicative of the high priority that law enforcement agencies are placing on investigating and prosecuting fracking-related environmental crimes in the Marcellus Shale.
In light of the increased attention being paid to drilling companies and associated enterprises in the Marcellus Shale, it is critical to ensure that your business, or your clients' businesses, have appropriate compliance and training programs in place.
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