EPA Issues Revised Guidance on the Use of Diesel Fuels in Hydraulic Fracturing

EPA Issues Revised Guidance on the Use of Diesel Fuels in Hydraulic Fracturing

Pursuant to its authority under the federal Safe Drinking Water Act (SDWA), the United States Environmental Protection Agency (EPA) has issued final, revised guidance for permitting hydraulic fracturing activities that use diesel fuels. By way of background, an Underground Injection Control (UIC) permit is typically required under the SDWA for any underground injection, including the injection of fluids for enhanced recovery of oil or natural gas (classified as Class II underground injections). However, the Energy Policy Act of 2005, codified at 42 U.S.C. § 300h(d) [enhanced version available to lexis.com subscribers], redefined "underground injection" in the SDWA to effectively exclude oil and gas hydraulic fracturing operations from the SDWA’s UIC permitting requirements, except when diesel fuels are used. The relevant language in the Energy Policy Act of 2005 reads: "(1) UNDERGROUND INJECTION.–The term ‘underground injection’ – (A) means the subsurface emplacement of fluids by well injection; and (B) excludes...(ii) the underground injection of fluids or propping agents (other than diesel fuels) pursuant to hydraulic fracturing operations related to oil, gas, or geothermal production activities."

For several years following the enactment of the Energy Policy Act of 2005, the EPA did not provide any detail about how the existing UIC regulatory program would apply to hydraulic fracturing operations that use diesel fuels. To fill that gap, in May 2012 EPA published a draft guidance (and a fact sheet) for UIC permitting of hydraulic fracturing activities using diesel fuels. The draft guidance defines the term "diesel fuels" and provides technical guidance on permitting UIC Class II wells using diesel fuels for hydraulic fracturing. EPA accepted public comments on the draft guidance.

In February 2014, EPA released a revised final guidance document on UIC permitting for hydraulic fracturing using diesel fuels, along with responses to selected substantive public comments on the draft guidance, a fact sheet and a memorandum to EPA’s regional offices regarding implementation of the guidance. Some highlights of the final guidance document include:

·   EPA refined its definition of "diesel fuels" for purposes of the SDWA as fluids associated with five specific Chemical Abstracts Service Registry Numbers (CASRNs) rather than the six CASRNs initially proposed in its draft guidance.

·   EPA’s interpretation of the Energy Policy Act of 2005’s language does not include a de minimis threshold; therefore, EPA instructs permit writers to issue a UIC permit when any amount of diesel fuel is planned for injection during hydraulic fracturing.

·   EPA recommended practices for incorporating regulatory requirements for Class II UIC wells into permits for hydraulic fracturing using diesel fuels, including, but not limited to:

·   Developing a site-specific "Area of Review," using one of the calculation methods developed by EPA to account for directional drilling;

·   Setting maximum injection pressures; and

·   Conducting mechanical integrity tests to ensure that the well is competent to withstand high injection pressures.

According to EPA's new guidance, permitting decisions will be made on a case-by-case basis and permit writers have discretion "to consider alternative approaches" consistent with legal requirements. The implementation process for the new guidance may vary depending on the regulatory authority responsible for implementing the UIC program in each state where hydraulic fracturing occurs. The EPA is the UIC permitting authority in states, like Pennsylvania, that have not received primary enforcement responsibility (primacy). Other states, including Ohio and West Virginia, have received primacy approval from EPA to implement the UIC program and issue UIC permits. Regardless of the UIC program implementing authority, owners or operators injecting diesel fuels for hydraulic fracturing without a UIC permit may be subject to an enforcement action under the SDWA.

For more information on UIC permitting, as it pertains to hydraulic fracturing and diesel fuels, please contact Joseph K. Reinhart at (412) 394-5452 or jreinhart@babstcalland.com, Sean M. McGovern at (412) 394-5439 or smcgovern@babstcalland.com, or Abigail Faulkner Jones at (412) 773-8758 or ajones@babstcalland.com.

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