NC fracking panel passes chemical disclosure rule
reposted from N& O article January 14, 2014
RALEIGH — Fracking companies won the right to keep secret the chemical cocktails they pump underground during shale gas drilling in North Carolina under a chemical disclosure rule approved Tuesday by the N.C. Mining and Energy Commission.
The public safety standard will help the energy companies protect their secret sauce used in natural gas drilling, but critics said it would also keep residents in the dark about potent chemicals used near local farms and waterways.
The rule passed unanimously after nearly three hours of intense debate Tuesday, and it follows more than a year of deliberations that had the commissioners tied up in knots. Commissioners sought to appease frightened residents, the energy industry and lawmakers eager to promote drilling for economic development.
The rule as passed by the commission is merely a recommendation to the state legislature, which will have final say over fracking standards later this year or next year. But as it now stands, the rule puts North Carolina among the states that don’t require energy exploration companies to turn over corporate trade secrets to government agencies for safeguarding in case of emergency.
“A lot of folks have heartburn because there are some states that do take possession of the trade secret,” said Commission Chairman James Womack. “We will have safe and responsible drilling in North Carolina.”
Review of trade secrets
Several experts said Tuesday that in some ways, North Carolina’s standard for chemical disclosure is more stringent than the public protections of many states that allow fracking. In this state, for example, a corporate trade secret claim would undergo an agency review to make sure it wasn’t bogus.
“They get an opportunity to call B.S. on a bad claim,” said Wayne D’Angelo, a Washington D.C., lawyer who represents industrial clients on energy and environmental issues related to fracking.
Shale gas exploration is under moratorium in North Carolina as the Mining and Energy Commission races to complete more than 100 regulations to protect the environment and public health.
Chemicals are used in fracking to break up shale rock and release trapped gas and prevent pipe corrosion. They do not have to be publicly disclosed under a 2005 congressional exemption to the Clean Water Act, prompting states to come up with their own standards. The chemicals range from household cleansers to food additives and industrial solvents.
North Carolina’s rule, if approved by lawmakers, will require that any trade secret claim be reviewed by the N.C. Department of Environment and Natural Resources. The review process has not been created but would require a sworn statement from the company that the trade secret has not been publicly disclosed elsewhere.
“The rule requires that permitees provide relatively detailed justifications when they claim trade secrets,” said Hannah Wiseman, a law professor at Florida State University who studies fracking regulations across the country.
Operators at a drill site are required by federal law to keep a safety sheet detailing chemicals used on that site; they are also required to turn over the data to public officials during a spill or accident.
But getting the same data off-site is more complicated. Such a request would be handled by calling a 24-hour phone number, to be staffed by the energy company, as called for by North Carolina’s rule. The company would have two hours to disclose the information to medical professionals and emergency responders, but it’s not clear how the company would validate that the request is legitimate and authorized.
Many have criticized this process as unworkable, especially if residents complained of polluted water or delayed symptoms long after the company and its contractors had left the state.
“An individual can be sick, hospitalized, drunk or have the phone off the hook,” John Wagner, a Chatham County resident, told the commission. “Access means full and immediate access, not access to material at the office, or in a safety deposit box that is available on the next business day.”
Chemicals shielded as trade secrets are commonly known by chemists and scientists, so the only issue is which chemicals a company is using in its mixture, and in what combinations.
“The secrecy thing is to me a joke,” said Commissioner Vikram Rao, a former chief technology officer for energy conglomerate Halliburton. “The secret, such as it is, is only of value to the competitor.”