Exemptions from Federal Environmental Law for Oil & Gas

The oil and gas industry enjoys exemptions or exclusions from regulation under most federal environmental laws.  No other industry enjoys such wide exemptions, nor do these exemptions make any sense from the standpoint of environmental protection.

Clean Water Act defines the term “pollutant”: the 2005 Energy Policy Act amended the CWA to say that sediment is not a pollutant, which applies to all sediments from oil and gas construction activities and operations.  And it specifically exempts hydraulic fracturing fluids from the definition:  “This term does not mean … (b) water, gas, or other material which is injected into a well to facilitate production of oil or gas, or water derived in association with oil or gas production and disposed of in a well, if the well used either to facilitate production or for disposal purposes is approved by the authority of the State in which the well is located, and if such State determines that such injecton of disposal will not result in the degradation of ground or surface water resources.” (33 USC Chapter 26). Leaves it up to the states.

Safe Drinking Water Act contains a clause added in the 2005 Energy Policy Act: “The term ‘underground injection’ … (B) excludes (i) the underground injection of natural gas for purposes of storage; and (ii) the underground injection of fluids or propping agents (other than diesel fuels) pursuant to hydraulic fracturing operations related to oil, gas or geothermal production activities. (42 USC 300 h (d))

Clean Air Act treats oil and gas operations as non-point-source (as separate tiny sources) when they should be treated as point-source, like most industries are treated when they have many sources aggregated: (4) (A) says “emissions from any oil or gas exploration or production well (with its associated equipment) and emissions from any pipeline compressor or pump station shall not be aggregated with emissions from other e similar units, whether or not such units are in a contiguous area or under common control”, and (B) says “The Administrator shall not list oil and as production wells 9with its associated equipment) as an area source category under subsection (c) of this section” except possibly (but not necessarily) when the area has a population over 1 million.  (42 USC 7401 et seq)

CERCLA (Comprehensive Environmental Response, Compensation and Liability Act, a.k.a. Superfund) defines the term “hazardous substance”:   “The term does not include petroleum, including crude oil or an fraction thereof which is not otherwise specifically listed or designated as a hazardous substance under sub-paragraphs (A) through (F) of this paragraph, and the term does not include natural gas, natural gas liquids, liquefied natural gas, or synthetic gas usable for fuel (or mixtures of natural gas and such synthetic gas).” (42 USC chaper 103 subchapter 1)

NEPA (National Environmental Policy Act): The 2005 Energy Policy Act amended NEPA to subject oil and gas to a less-stringent review process called a “categorical exclusion”, which does not allow for public comment such as environmental impact statements and assessments do.  It shifts the burden of proof from the industry to the public. (Section 390  NEPA Review of 2005 Energy Policy Act).

EPCRA (Community Right to Know / Toxic Release Inventory):  EPA chose to abdicate its responsibility under EPCRA to inform the public about these toxic releases by exempting the oil and gas industry from reporting under section 313.

RCRA (Resource Conservation and Recovery Act): The Solid Waste Disposal Act, section 3001,  in 1980 excluded oil and gas from RCRA’s application under subtitle C.  The SWDA stated: “drilling fluids, produced waters, and other wastes associated with the exploration, development or production of crude oil or natural gas or geothermal energy shall be subject only to existing State or Federal regulatory programs in lieu of subtitle C” for at least 2 years, and the EPA Administrator was told to then determine whether to promulgate regulations only if it could prove that the wastes were a danger to human health and the environment.  Which, of course, the administrator did in 1988.  Now you can follow a flow chart to determine if a waste is regulated under subtitle C.  The EPA’s clarified its position with this: “A simple rule of thum bor determining the scope of the exemption is whether the waste in question has come from down-hole (i.e., brought to the surface during oil and gas E & P operations), or has otherwise been generated by contact with the oil and gas production stream during the removal of produced water or other contaminants from the product (e.g., waste emulsifiers, spent iron sponge). If the answer to either question is yes, the waste is most likely considered exempt.

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