Friday, October 20, 2017

Global Shale Law Compendium: Shale Law Governance in New England States

Written by Chloe Marie – Research Fellow

The Global Shale Law Compendium series addresses legal development and other issues related to the governance of shale oil and gas activities in various countries and regions of the world. In this article, we will focus on the legal policy, and governance issues related to shale gas development in the United States, and more specifically in the New England states.

Connecticut

According to the U.S. EIA, Connecticut does not possess natural gas resources, however, “natural gas produced from the Appalachian shales, particularly the Marcellus Shale of Pennsylvania, is now arriving in the state.” In February 2013, the Connecticut Department of Energy and Environmental Protection released a Comprehensive Energy Strategy for Connecticut in which the state agency highlighted the fact that, through the establishment of a pipeline infrastructure, “new and abundant shale gas supplies presents Connecticut residents and businesses with a rare opportunity to capture significant benefits at modest costs that can be recouped quickly.”

Expressing a different viewpoint, on February 21, 2014, state Representatives introduced and sent to the Joint Committee on Environment Senate Bill No.  237 whose purpose is to prohibit the storage or disposal of materials produced as a result of hydraulic fracturing activities. The Bill also directs the Connecticut Department of Energy and Environmental Protection (DEEP) to adopt regulations addressing a schedule of penalties for violations. The Bill was signed into law on June 12, 2014.

Maine

In the Maine Energy Profile Analysis, the U.S. EIA stated that Maine does not have any oil and natural gas resources and production. It also added that Maine relies on imported natural gas from Canada.

Earlier this year, House Representative John L. Martin introduced Bill LD 1453; HP 1003 entitled “An Act to Regulate Hydraulic Fracturing To Prevent Threats to Maine’s Drinking Water” and sent it to the Maine Legislature’s Committee on Environment and Natural Resources. The proposed legislation would required the Maine Department of Environment Protection (DEP) to adopt regulations addressing hydraulic fracturing by December 31, 2017, “in order to prevent threats to drinking water resources from hydraulic fracturing.” According to a media report, Representative John Martin (said he originally hoped to ban the practice after a northern Maine television station aired a story about potential efforts to use fracking in neighboring New Brunswick.” The Bill, however, did not advance through a Senate committee.

Massachusetts

The Massachusetts Geological Survey stated that the geologic conditions of the Hartford Basin underlying the Connecticut Valley in western Massachusetts are not “optimum” for shale gas extraction based on available scientific data. The U.S. EIA also declared that “Massachusetts has no natural gas reserves or production, but, in proportion to its population, the state consumes nearly half of the natural gas used in New England” before adding that “deliveries of natural gas from the Marcellus Shale of Pennsylvania through New Jersey, Connecticut, and Rhode Island and on to Massachusetts have increased significantly in recent years.”

The Massachusetts State Legislature has attempted many times to prevent or limit shale gas extraction in the state in the event that such development could become possible even though energy companies have expressed no interest in exploring for or developing shale gas in Massachusetts. In November 2013, the Massachusetts State Legislature’s Joint Committee on Environment, Natural Resources and Agriculture introduced Bill H. 3796 that would have banned the use of hydraulic fracturing in Massachusetts until December 21, 2024. The bill did not advance through the legislative process.

New Hampshire

According to the U.S. EIA, the state of New Hampshire does not have any oil or natural gas resources or production; and thus no shale gas development is currently occurring in the state. New Hampshire is an importer of natural gas from Maine, Massachusetts and Canada, and interestingly, “with the growth of natural gas production in the Marcellus Shale in Pennsylvania, Maine – which used to ship Canadian natural gas to New Hampshire – may now receive more natural gas through New Hampshire than it ships to the state.”

Rhode Island

Just like New Hampshire, the state of Rhode Island does not hold any oil or natural gas resources and received most of its natural gas supply fthrough Connecticut and Massachusetts. The U.S. EIA states that “historically, natural gas has arrived in Rhode Island from producing areas in Canada and from the U.S. Gulf Coast and Mid-Continent regions, but increasing amounts of natural gas are coming from Appalachian shales, particularly the Marcellus Shale of Pennsylvania.”

Vermont

On May 16, 2012, former Governor Peter Shumlin approved and signed into law Bill H. 464 entitled “An act relating to hydraulic fracturing wells for natural gas and oil production,” which prohibits the use of hydraulic fracturing for oil and gas development in the state as well as the transportation, storage and disposal of hydraulic fracturing waste. The Act also directs the Vermont Agency of Natural Resources to prepare a report providing recommendations on how hydraulic fracturing should be regulated statewide as well as a report assessing the environmental and public health impacts of hydraulic fracturing in Vermont.

The Agency addressed those issues in a unique report submitted to the Senate House Committees on Natural Gas Resources and Energy and the House Committee on Fish, Wildlife and Water Resources in February 2015. The report concludes that “at the present time, the Agency of Natural Resources – Department of Environmental Conservation does not have sufficient evidence that hydraulic fracturing for oil and gas can be conducted without risk of contamination to the groundwater of Vermont,” and thus recommends that the prohibition on the use of hydraulic fracturing for oil and natural gas development remain.

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