Report: State Fracking Regulations Lag Behind Other States

Aug 1, 2013

A report by environmentalists raises questions about a little-examined aspect of the fracking debate.

The Environment Ohio Research and Policy Center examined the state's financial assurance requirements for drilling operations and found its bonding requirements inadequately protect communities from the impacts of fracking. Spokesperson Julian Boggs says reclaiming a fracking site can cost hundreds of thousands of dollars, and there also are other costly damages, such as ruined roads and contaminated groundwater.

Boggs says the state requires drillers to secure 5 thousand dollars in bonds per well up front, while some other states require 250 thousand. State lawmakers rejected Governor John Kasich's plan to raise the severance tax on the oil and gas industry in the state budget. Boggs says that would have provided a cushion for long-term risk management. Youngstown City Council member Mike Ray says he's seen the damage from fracking up close. Youngstown was the site of an earthquake that scientists have said was caused by fracking.

The report recommends new rules which would ensure broad accountability; eliminate loopholes, exemptions and discounts; and create stronger forms of financial insurance. Drillers call the recommendations excessive government regulation that would hurt their ability to generate profit and jobs. But experts say say arrogance, a lack of transparency and poor communication on the part of the drilling industry have helped fuel public anger over fracking. Former Shell Oil President John Hofmeister says it's been a mistake for some in the industry to suggest gas wells never cause problems. Hofmeister says the industry has a very good safety record but not a perfect one. Penn State University geologist Terry Engelder says the Shale drilling boom in Ohio and other states has brought many benefits but can never be risk-free.