WASHINGTON, DC – As their federal counterparts in Washington, D.C. look for new and creative ways to restrict the responsible use of a critical natural gas and oil extraction technique known as hydraulic fracturing, states with decades of experience in regulating the technology are not taking the effort lying down.

Earlier this week, the Louisiana House became the latest in a string of legislatures where resolutions affirming the chamber’s support for hydraulic fracturing – or opposition to Congress’s effort to disrupt the current partnership – were either formally filed or broadly approved. Many of these states have effectively regulated fracturing activities for more than a half century, and stand to lose the most – in jobs, revenue, royalties and energy output – should EPA be given regulatory authority over the proven technology. To learn more specifics about hydraulic fracturing technology, click here.

“If hydraulic fracturing were unsafe, unregulated, and largely unnecessary as a tool of producing American energy, Congress would have a good reason to step in, and states would have an even better one to step out,” said Lee Fuller, a spokesman for Energy In Depth, a new coalition of American oil and natural gas trade groups. “Clearly, that is not the case. And that’s why you’ve seen states from the Southeast to the Intermountain West stand up, shoulder-to-shoulder, and affirm their support for this safe, critical and increasingly valuable well stimulation technology”.

The latest effort out of Baton Rouge, La. was introduced by Rep. Joe Harrison, R-Napoleonville, and calls on Congress to maintain a provision in existing federal law preserving Congress’s intent not to regulate hydraulic fracturing under the Safe Drinking Water Act (SDWA) of 1974, legislation designed to protect public water supplies. In 1974, hydraulic fracturing had already been in commercial use for 25 years. At no time during its deliberation, nor in subsequent debates on amendments to SDWA in 1986 and 1996, was the concept of regulating hydraulic fracturing under SDWA ever a consideration.

The reason? Hydraulic fracturing was then, and continues to be now, aggressively regulated by the states, compiling an impressive record of safety and performance over that time. More than 60 years after its first commercial use, not a single case of hydraulic fracturing-related contamination has been documented by the federal government. In fact, a landmark 2004 study conducted by EPA found that hydraulic fracturing posed “no threat” to underground drinking water supplies.

Because of that, other states – such as Alabama, North Dakota, Utah, Wyoming, Oklahoma and Texas – have taken up or passed resolutions similar to the one being considered in Louisiana. In New Mexico, former U.S. Energy Secretary and current Governor Bill Richardson introduced a plan in February aimed at easing unnecessary compliance burdens, recognizing that thousands of jobs and millions in potential revenue were tied to safe, responsible, state-regulated natural gas and oil production.

Those conclusions are supported in full by a recent set of studies known collectively as Project BRIEF (Bringing Real Information on Energy Forward), commissioned by the Energy in Depth coalition. In particular, BRIEF found that proposed changes to federal regulations, including those related to hydraulic fracturing, could result in:

• The forced closure of more than half of America’s oil wells, and a third of its gas wells
• $4 billion in lost revenue to the federal government; state treasuries would lose $785 million
• Domestic oil production slashed by 183,000 barrels per day; natural gas by 245 billion cubic feet per year

Planet Gore (National Review On-Line): Fractured Thinking. Chris Horner writes an extensive post on hydraulic fracturing and Rep. Dianna DeGette’s plans to insert legislation regulating the practice into the Waxman-Markey climate control bill.

The Greenwood Commonwealth (Mississippi): Bias Against Oil is Dangerous. In an editorial, The Greenwood Commonwealth writes against the attacks on the domestic oil and gas industry coming from Washington.

Tri-County Courier Express: Gas Wells on DuBois’ Reservoir Watershed? DuBois, Pennsylvania “is still exploring the option of drilling gas wells at the Anderson Creek Reservoir.” “We are looking forward to this venture because it will help the city out financially,” said Mayor John “Herm” Suplizio. “Suplizio said the city owns gas and oil rights to 2,000 acres. He said the city could lease all 2,000 acres and receive $500 per acre, which translates into $1 million. The city could also receive 15 percent in royalties for the gas.”

The Shreveport Times reports the study found that as a result of those activities:

• About $2.4 billion in business sales have been created in the state;
• Nearly $3.9 billion in household earnings were created, including almost $3.2 billion in lease and royalty payments to private landowners. The figure represents about 70 percent of the total expenditures associated with extraction activity in northwest Louisiana natural gas formation and is mostly in the form of mineral lease and royalty payments.
• About 32,742 jobs were created, equal to slightly more than the total employment of all of Louisiana’s banks and credit unions.
• State and local sales tax revenue increased by at least $153.3 million, with Red River Parish reporting tax collections up 300 percent in the first quarter of this year.

Natural Resources Secretary Scott Angelle said: the “study indicates that the Haynesville Shale may be every bit the game changer for our state that we all hoped it might be…I think we are entering the golden age of natural gas. And Louisiana has the opportunity to take the lead in supplying it and showing the rest of the nation how to make the best use of it.”

The article goes on to say that the Haynesville Shale play has “somewhat insulated the local economy from the national doldrums.”

Other states-New York, Pennsylvania and West Virginia, to name a few-have vast natural gas resources, just like Louisiana. In the coming years, they have the chance to experience the same benefits of the folks in the Bayou State.

 The Colorado Independent reports:

U.S. Rep. Diana DeGette is leading the charge to increase federal oversight of the nation’s natural gas industry, reintroducing a bill that specifically targets a process called hydraulic fracturing.

DeGette and hydraulic fracturing detractors claim the practice harms the environment and is damaging to public health. But Energy in Depth readers (and the EPA) know that’s not the case-and that states already effectively regulate hydraulic fracturing.

The fluids used in the process are more than 95 percent water, and fracturing activities take place thousands of feet below the water table. What’s more, extensive precautions are taken to case wells near the surface to prevent any leakage of fracturing fluid, oil or natural gas.

And while the Independent refers to highlighting the economic consequences of eliminating this safe engineering practice as an industry “tactic,” we’re sure the hundreds of thousands of Americans whose jobs rely on hydraulic fracturing might think differently.

Here are the facts:

• Hydraulic fracturing is responsible for 30 percent of our domestic recoverable oil and natural gas, and has aided in the extraction of more than seven billion barrels of oil and 600 trillion cubic feet of natural gas.
• Up to 90 percent of the wells currently operating today have been fraced, and in the future, 60 to 80 percent of new wells may have to undergo fracturing in order to remain viable.
• In 2007, $226 billion was invested in domestic exploration and production. Those investments drive economic growth, support local businesses and keep Americans working. Royalties paid by producers totaled $30 billion in 2007, and billions were paid to federal and local governments in the form of severance and income taxes.
• Hydraulic fracturing accounts for a significant portion of the total economic activity attributable to domestic energy production. More than 300,000 Americans are employed in the exploration and production of domestic oil and natural gas.

What’s more, regulating hydraulic fracturing out of existence would have disastrous economic consequences, including the loss of thousands of jobs, billions in government revenue and the closure of 150,000 natural gas wells.

America can’t afford to unnecessarily curb domestic energy production and destroy jobs-and the DeGette amendment would do just that.

The driving force behind technological innovation and the growth in US natural gas reserves and production has been the independent E&P company. It is the independents who pursued the coal bed methane idea in the 1980s turning it into an industry and it is the independents who have turned shale from an intriguing idea in the 1990s to a rapidly expanding (and potentially very large) US natural gas industry this decade.

Some in Washington and the media like to portray America’s energy industry as a monolithic giant. Too often, the importance of small and indpendent producers–many of which employ less than twenty people, but are responsible for 90 percent of America’s oil and natural gas wells–is forgotten.

Because of independent energy firms work, states from Texas to New York can now produce billions of cubic feet of natural gas to help power America.

The Barnett shale (Texas), still in the early stages of development, already accounts for almost 6% of lower 48 gas production. There are, at present, 26 named shale basins in the US. The Barnett dominates commercial production. There is also growing activity in the Haynesville/ Bossier (Louisiana), Antrim (Michigan), Fayetteville (Arkansas), Marcellus (mostly Pennsylvania), and New Albany (Indiana) shale basins.

And the investment in new technologies is paying off:

Advances in horizontal drilling (which creates multiple productivity and cost benefits and has a much smaller footprint than vertical drilling) and high volume hydraulic fracturing, backed by the determination and risk capital of independent E&P companies are driving this cycle of reserve optimism. If this rising arc of optimism can be translated into actual production, then the economic and national security payoffs for the US will be considerable.

All in all, the impact of America’s small energy firms is anything but small.