From the Arkansas Statehouse...

For oil and gas industry, a stronger hand.

In Energy, Environment on 4 March 2009 at 9:18 am

Although they are frequently drowned out by braying over guns in church or what have you, there have been quiet debates this session over several issues that could have an major practical impact. One such debate came to a head yesterday when the Senate voted to require that a majority of the Oil and Gas Commission be experienced in the business of oil and gas.

On its face, this is not an objectionable proposal. I’d really not paid it much mind until yesterday. You want people who know how the technology works on the commission, right? Besides, if earlier testimony on the House floor is to be trusted — not always a given, I’ve found — the Oil and Gas Commission has traditionally been controlled by a majority in the business. The current law says four members have to be experienced; the change just reflects that the commission has expanded from seven to nine in recent years.

Yet a review of the gas industry in Arkansas and look at the Oil and Gas Commission’s responsibilities brings second thoughts.

Let’s take the latter first. As stated by Arkansas Code 15-17-110, the Oil and Gas Commission is to require that wells be drilled, operated and plugged so as to “prevent the pollution of fresh water supplies and unnecessary damage to property, soil, animals, fish, or aquatic life by oil, gas, or salt water.” And witness the commission’s own mission statement:

The purpose of the Arkansas Oil and Gas Commission is to serve the public regarding oil and gas matters, prevent waste, encourage conservation, and protect the correlative rights of ownership associated with the production of oil, natural gas and brine, while protecting the environment during the production process, through the regulation and enforcement of the laws of the State of Arkansas.

In short, the Oil and Gas Commission is charged with significant stewardship over the environment. But I think it’s safe to say that clean water is not the first thing on a gas driller’s mind when there’s a bonanza to be had.

Which brings us to the current state of the gas industry in Arkansas. The Fayetteville Shale has changed the game. A majority of energy people on the Oil and Gas Commission did not have the same impact a decade ago as does now, when drilling is exploding to unheard of proportions.

Sen. Joyce Elliott, who led a floor debate against the measure yesterday afternoon, brought up some of these concerns in a later interview.

(Click the link below for Sen. Elliott’s comments.)

“It’s bad public policy to guarantee that the interest being regulated is in the majority,” Sen. Elliott said. “The future consequences could be devastating for the state.” She was concerned that the bill will tie the hands of future governors. She added that members of the commission should be selected because they will serve the state’s interest, not because they represent a particular industry.

Sen. Elliott was also worried about the environmental consequences of the bill. “I’m just hoping ADEQ [Arkansas Department of Environmental Quality] will put them in check,” she said. ADEQ is currently facing a dearth of inspectors and is widely acknowledged to be short-handed in regulation of the Fayetteville Shale area.

The Senate vote went in favor of the bill 20-7. The bill will return to the House since it was amended in the Senate.

The fight over the Oil and Gas Commission brings another point into stark relief: there has been a severe lack of environmental legislation this session despite the increase of potentially harmful drilling.

As it turns out, I don’t oppose the Oil and Gas Commission bill on its face. The commission has to oversee complex drilling procedures, and it does make sense to employ people who knows how the technology works.

But there needs to be some environmental balance.  A stronger ADEQ, revamped regulations that take environmental oversight from the Oil and Gas Commission, a renewed focus on the pollution caused by gas drilling — something, anything, to ensure that the land and water of the state is cared for. As it is now, Arkansans will have to entrust that concern largely to a few oil and gas men.


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