```

[House Hearing, 113 Congress]
[From the U.S. Government Publishing Office]

 
   H.R. 2728, PROTECTING STATES' RIGHTS TO PROMOTE AMERICAN ENERGY 
                             SECURITY ACT

=======================================================================

                          LEGISLATIVE HEARING

                               before the

                       SUBCOMMITTEE ON ENERGY AND

                           MINERAL RESOURCES

                                 of the

                     COMMITTEE ON NATURAL RESOURCES

                     U.S. HOUSE OF REPRESENTATIVES

                    ONE HUNDRED THIRTEENTH CONGRESS

                             FIRST SESSION

                               __________

                        Thursday, July 25, 2013

                               __________

                           Serial No. 113-36

                               __________

       Printed for the use of the Committee on Natural Resources

         Available via the World Wide Web: http://www.fdsys.gov
                                   or
          Committee address: http://naturalresources.house.gov

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                     COMMITTEE ON NATURAL RESOURCES

                       DOC HASTINGS, WA, Chairman
            PETER A. DeFAZIO, OR, Ranking Democratic Member

Don Young, AK                        Eni F. H. Faleomavaega, AS
Louie Gohmert, TX                    Frank Pallone, Jr., NJ
Rob Bishop, UT                       Grace F. Napolitano, CA
Doug Lamborn, CO                     Rush Holt, NJ
Robert J. Wittman, VA                Raul M. Grijalva, AZ
Paul C. Broun, GA                    Madeleine Z. Bordallo, GU
John Fleming, LA                     Jim Costa, CA
Tom McClintock, CA                   Gregorio Kilili Camacho Sablan, 
Glenn Thompson, PA                       CNMI
Cynthia M. Lummis, WY                Niki Tsongas, MA
Dan Benishek, MI                     Pedro R. Pierluisi, PR
Jeff Duncan, SC                      Colleen W. Hanabusa, HI
Scott R. Tipton, CO                  Tony Cardenas, CA
Paul A. Gosar, AZ                    Steven A. Horsford, NV
Raul R. Labrador, ID                 Jared Huffman, CA
Steve Southerland, II, FL            Raul Ruiz, CA
Bill Flores, TX                      Carol Shea-Porter, NH
Jon Runyan, NJ                       Alan S. Lowenthal, CA
Mark E. Amodei, NV                   Joe Garcia, FL
Markwayne Mullin, OK                 Matt Cartwright, PA
Chris Stewart, UT                    Vacancy
Steve Daines, MT
Kevin Cramer, ND
Doug LaMalfa, CA
Jason T. Smith, MO

                       Todd Young, Chief of Staff
                Lisa Pittman, Chief Legislative Counsel
                 Penny Dodge, Democratic Staff Director
                David Watkins, Democratic Chief Counsel
                                 ------                                

              SUBCOMMITTEE ON ENERGY AND MINERAL RESOURCES

                       DOUG LAMBORN, CO, Chairman
                RUSH HOLT, NJ, Ranking Democratic Member

Louie Gohmert, TX                    Steven A. Horsford, NV
Rob Bishop, UT                       Matt Cartwright, PA
Robert J. Wittman, VA                Jim Costa, CA
Paul C. Broun, GA                    Niki Tsongas, MA
John Fleming, LA                     Jared Huffman, CA
Glenn Thompson, PA                   Alan S. Lowenthal, CA
Cynthia M. Lummis, WY                Tony Cardenas, CA
Dan Benishek, MI                     Raul M. Grijalva, AZ
Jeff Duncan, SC                      Colleen W. Hanabusa, HI
Paul A. Gosar, AZ                    Joe Garcia, FL
Bill Flores, TX                      Vacancy
Mark E. Amodei, NV                   Vacancy
Chris Stewart, UT                    Vacancy
Steve Daines, MT                     Peter A. DeFazio, OR, ex officio
Kevin Cramer, ND
Doc Hastings, WA, ex officio
                                 ------                                
                                CONTENTS

                              ----------                              
                                                                   Page

Hearing held on Thursday, July 25, 2013..........................     1

Statement of Members:
    Cartwright, Hon. Matt, a Representative in Congress from the 
      State of Pennsylvania......................................     4
        Prepared statement of....................................     5
    Flores, Hon. Bill, a Representative in Congress from the 
      State of Texas.............................................     7
        Prepared statement of....................................     9
    Lamborn, Hon. Doug, a Representative in Congress from the 
      State of Colorado..........................................     1
        Prepared statement of....................................     3

Statement of Witnesses:
    Craddick, Christi, Commissioner, Railroad Commission of Texas    16
        Prepared statement of....................................    17
        Response to questions submitted for the record...........    23
    Epstein, Lois N., P.E., Arctic Program Director, The 
      Wilderness Society.........................................    29
        Prepared statement of....................................    30
        Response to questions submitted for the record...........    33
    Foerster, Catherine P., Chair and Engineering Commissioner, 
      Alaska Oil and Gas Conservation Commission.................    11
        Prepared statement of....................................    13
        State Review of Oil and Natural Gas Environmental 
          Regulations (STRONGER), Link to ``STRONGER Guidelines'' 
          submitted for the record...............................    50
    Rogers, John C., Associate Director, Utah Division of Oil, 
      Gas, and Mining............................................    25
        Prepared statement of....................................    27

Additional materials supplied:
    Energy Producing States Coalition (EPSC), Letter to The 
      Honorable John Boehner and The Honorable Nancy Pelosi dated 
      July 25, 2013, submitted for the record....................    49
                                     

LEGISLATIVE HEARING ON H.R. 2728, A BILL TO RECOGNIZE STATES' AUTHORITY 
    TO REGULATE OIL AND GAS OPERATIONS AND PROMOTE AMERICAN ENERGY 
SECURITY, DEVELOPMENT, AND JOB CREATION. ``PROTECTING STATES' RIGHTS TO 
                PROMOTE AMERICAN ENERGY SECURITY ACT.''

                              ----------                              

                        Thursday, July 25, 2013

                     U.S. House of Representatives

              Subcommittee on Energy and Mineral Resources

                     Committee on Natural Resources

                            Washington, D.C.

                              ----------                              

    The Subcommittee met, pursuant to notice, at 9:36 a.m., in 
room 1334, Longworth House Office Building, Hon. Doug Lamborn 
[Chairman of the Subcommittee] presiding.
    Present: Representatives Lamborn, Benishek, Flores, Cramer, 
Mullin, Cartwright, Lowenthal, and Garcia.
    Mr. Lamborn. The Committee will come to order. The 
Committee notes the presence of a quorum, which, under 
Committee Rule 3(e), is two Members.
    The Subcommittee on Energy and Mineral Resources is meeting 
today to hear testimony on an legislative hearing on Mr. Flores 
and my bill to recognize States' authority to regulate oil and 
gas operations and promote American energy, security, 
development, and job creation, known as the ``Protecting 
States' Rights to Promote American Energy Security Act.''
    Under Committee Rule 4(f), opening statements are limited 
to the Chairman and Ranking Member. However, I ask unanimous 
consent to include any other Members' opening statements in the 
hearing record if submitted to the clerk by close of business 
today.
    [No response.]
    Mr. Lamborn. Hearing no objection, so ordered. Also, I ask 
unanimous consent that Mr. Markwayne Mullin of Oklahoma be 
allowed to participate in today's hearing, when he is able to 
join us.
    [No response.]
    Mr. Lamborn. Hearing no objection, so ordered. I also ask 
unanimous consent that the author of the legislation under 
consideration today be permitted to give a 5-minute opening 
statement.
    [No response.]
    Mr. Lamborn. Hearing no objection, so ordered. I now 
recognize myself for 5 minutes.

    STATEMENT OF THE HON. DOUG LAMBORN, A REPRESENTATIVE IN 
              CONGRESS FROM THE STATE OF COLORADO

    Mr. Lamborn. I would like to start by thanking our 
distinguished panel of State official witnesses for being here 
today. Today we are meeting on the title of a bill, 
``Protecting States' Rights to Promote American Energy Security 
Act.'' This legislation, introduced by Congressman Flores and 
myself, would require the Department of the Interior to defer 
to State regulations, permitting, and guidance regarding 
hydraulic fracturing on Federal lands within the States' 
borders.
    Since taking office, the Obama Administration has pursued 
the nationalization of hydraulic fracturing regulations, 
determining that a big government solution is the best 
solution. While the Administration claims these regulations are 
meant as a baseline, the reality is that these are burdensome 
and duplicative regulations that could significantly inhibit 
hydraulic fracturing on Federal land, thereby inhibiting energy 
production, American job creation, and continuing our 
dependence on foreign energy imports.
    At a hearing last week, Secretary Jewell testified to our 
Committee that baseline standards covering flowback control, 
wellbore integrity, and other basic requirements were needed at 
the Federal level. However, the States have proactively taken 
the lead in managing hydraulic fracturing development on their 
lands, and have been successfully doing so for decades.
    Nevertheless, the Administration continues to pursue 
implementation of its own unnecessary, one-size-fits-all 
Federal regulations, with practically no acknowledgment of the 
work that the States have been doing for years in managing 
energy production, while taking into consideration their own 
unique geography, hydrology, and production issues. This big 
government, one-size-fits-all generic approach to energy 
regulation will not work. Yet this Administration continues to 
approach energy regulation treating all 50 States the same.
    While the Administration and Secretary Jewell claim they 
will accept existing State rules, in reality the proposed 
regulations place the burden nearly entirely on the shoulders 
of the energy producer to prove to the BLM on a well-by-well 
basis that the States they are operating in has adequate or 
comparable regulations.
    The Administration's own reporting said that 99 percent of 
the impact of this rule will fall on small businesses and 
independent producers who will bear the brunt of these 
regulations. And these are people who are less able to absorb 
the additional regulatory cost, and less capable of moving off 
Federal land for their production.
    In addition to being burdensome and duplicative, these 
regulations are unnecessary. State regulations have proven 
successful in managing hydraulic fracturing on their lands. The 
BLM claims the regulations are needed to prevent drinking water 
contamination as a result of energy development. However, 
multiple studies and witnesses have testified that extensive 
testing has shown no evidence of water contamination through 
hydraulic fracturing. Repeatedly we have seen the EPA retreat 
from radical statements on water contamination when the facts 
come forward, including in Pennsylvania, Wyoming, Ohio, and 
Texas. Time and time again, we have seen these false claims 
yield to science.
    More recently, on Monday, DOE's National Energy Technology 
Laboratory in Pittsburgh released preliminary results showing 
no evidence that chemicals from natural gas drilling operations 
have contaminated drinking water. Additionally, witnesses from 
Utah, Colorado, Ohio, and multiple other States have testified 
before our Committee that there have been no instances of 
environmental contamination due to hydraulic fracturing.
    The Protecting States' Rights to Promote American Energy 
Security Act will require the BLM to defer to existing State 
regulations and prohibit the Department from enforcing needless 
and duplicative Federal regulations in States that have 
existing regulations in place. This will allow domestic energy 
development to move forward, create and save American jobs, 
increase Federal revenue, and decrease our reliance on 
Federal--excuse me, foreign imports.
    I would like to thank our witnesses for coming before our 
Committee today, and I look forward to hearing your testimony.
    [The prepared statement of Mr. Lamborn follows:]

          Statement of The Honorable Doug Lamborn, Chairman, 
              Subcommittee on Energy and Mineral Resources

    I'd like to start by thanking our distinguished panel of State 
witnesses for being with us today. Today we are meeting on the 
``Protecting States' Rights to Promote American Energy Security Act.'' 
This legislation, introduced by Congressman Flores, would require the 
Department of the Interior to defer to State regulations, permitting, 
and guidance regarding hydraulic fracturing on federal lands within the 
State's boundaries.
    Since taking office, the Obama Administration has pursued the 
nationalization hydraulic fracturing regulations, determining that a 
big government solution is the best solution. While the Administration 
claims these regulations are meant as a ``baseline,'' the reality is 
these burdensome and duplicative regulations could significantly 
inhibit hydraulic fracturing on federal land--thereby inhibiting energy 
production, American job creation, and continuing our dependence on 
foreign energy imports.
    At a hearing last week, Secretary Jewell testified to our Committee 
that baseline standards covering flowback control, wellbore integrity, 
and other basic requirements were needed at the federal level. However, 
the States have proactively taken the lead in managing hydraulic 
fracturing development on their lands and have been successfully doing 
so for decades. Nonetheless, the Administration continues to pursue 
implementation of its own needless one size fits all federal 
regulations, with practically no acknowledgement of the work the States 
have been doing for years in managing energy production while taking 
into consideration their own unique geography, hydrology, and 
production issues. This big government one size fits all generic 
approach to energy regulation will not work, yet this Administration 
continues to approach energy regulation like all 50 states are exactly 
the same.
    While the Administration and Secretary Jewell claim they will 
accept existing state rules, in reality, the proposed regulations place 
the burden nearly entirely on the shoulders of the energy producer to 
prove to the BLM on a well by well basis, that the State they are 
operating in has adequate or comparable regulations. The 
Administration's own reporting said that 99% of the impact of this rule 
will fall on small businesses and independent producers who will bear 
the brunt of these regulations and are less able to absorb the 
additional regulatory cost and less capable of moving off federal land 
for their production.
    In addition to being burdensome and duplicative, these regulations 
are unnecessary. State regulations have proven successful in managing 
hydraulic fracturing on their lands. The BLM claims the regulations are 
needed to prevent drinking water contamination as a result of energy 
development. However, multiple studies and witnesses have testified 
that extensive testing has shown no evidence of water contamination. 
Repeatedly we have seen the EPA retreat from radical statements on 
water contamination when the facts come forward including in 
Pennsylvaina, Wyoming, Ohio and Texas. Time and time again, we have 
seen these false claims yield to the facts of science. More recently, 
on Monday DoE's National Energy Technology Laboratory in Pittsburgh 
released preliminary results showing no evidence that chemical from 
natural gas drilling operations contaminated drinking water. 
Additionally witnesses from Utah, Colorado, Ohio, and multiple other 
states have testified before our Committee that there have been no 
instances of environmental contamination due to hydraulic fracturing.
    The ``Protecting States' Rights to Promote American Energy Security 
Act'' will require the BLM to defer to existing State regulations and 
prohibit the Department from enforcing needless and duplicative federal 
regulations in states that have existing regulations in place. This 
will allow domestic energy development to move forward, create and save 
American jobs, increase federal revenue, and decrease our reliance on 
foreign imports. I'd like to thank our witnesses for coming before our 
Committee today and I look forward to hearing your testimony.
                                 ______
                                 
    Mr. Lamborn. I would now like to recognize the Ranking 
Member for his opening statement.

  STATEMENT OF THE HON. MATT CARTWRIGHT, A REPRESENTATIVE IN 
            CONGRESS FROM THE STATE OF PENNSYLVANIA

    Mr. Cartwright. Thank you, Mr. Chairman. Mr. Chairman, 
natural gas reserves, now accessible all across the United 
States through the use of hydraulic fracturing techniques, have 
the potential to reduce our dependence on foreign oil, lessen 
pollution that leads to global warming, reshape our 
manufacturing sector, and boost our economy overall. In fact, 
we are now producing more natural gas in America under 
President Obama than we ever have before.
    But we have to ensure that we develop this resource safely 
and in a way that protects our American environment. According 
to the Interior Department, 90 percent of all new wells drilled 
on public lands now employ hydraulic fracturing. As a result, 
the Interior Department has begun the process of conducting a 
rulemaking to govern the safety of hydraulic fracturing on 
public lands.
    Hydraulic fracturing, or fracking, is a topic with which we 
are all well acquainted. Just a few months ago the full 
Committee held an oversight hearing on BLM's upcoming 
regulation. Last week Secretary Jewell discussed the issue in 
testimony when she appeared before this Committee. And in less 
than 1 month, the public comment period on those revised 
regulations will close.
    Establishing minimum safety and environmental standards for 
fracking processes has been my top priority since being elected 
to the Congress. Now, this is why the first bill I introduced, 
the FRESHER Act, closed loopholes for oil and gas companies in 
the Clean Water Act, and has garnered 55 cosponsors so far. And 
that is why today I am introducing the CLEANER Act, which will 
ensure that oil and gas companies are required to test their 
waste to determine if it is hazardous and, if so, dispose of it 
using safe methods that other industries already are employing.
    I believe these reforms are crucial to implement basic 
standards for the entire country. And while the Congress 
refuses to hold votes on these bills, the Administration really 
must lead the way on our public lands.
    Now, the Majority has claimed that Federal regulation of 
fracking on America's public lands is not needed because States 
already have regulations in place. But State regulations vary 
widely in their requirements, in the stringency of those 
requirements, and the efficacy with which they are implemented. 
That is why it is important for the Interior Department to put 
in place a regulatory floor to ensure that there are minimum 
protections in place on public lands in all States. As stated 
by Secretary Jewell last Wednesday, part of her job is to make 
sure the Interior Department is watching over the Federal 
estate effectively.
    Now, the bill we are considering today, however, has a far 
broader reach than just the proposed regulations on hydraulic 
fracturing. This bill purports to take away from the Department 
of the Interior all authority to regulate any part of the 
hydraulic fracturing process on public lands. Now, these are 
very broad terms that have severe implications.
    For example, this bill would allow hydraulic fracturing to 
occur within any unit of the National Park System or any other 
Federal land, if permitted to do so under State law. Now, 
imagine a hydraulic fracturing well located next to the Grand 
Canyon National Park Visitors Center. If this bill were passed, 
the Federal Government would have absolutely no power to 
prevent just that from occurring.
    It should also be noted as well that this bill does not 
mention tribal authority, nor does it distinguish between 
Federal lands and tribal lands held in trust by the Federal 
Government. As a result, the bill would grant States full 
control of tribal lands so long as any ``component of the 
hydraulic fracturing process'' is involved. This Committee has 
had multiple hearings over the past two congresses focusing on 
the important distinction between Indian lands and public 
lands. Yet this bill fails to make such a distinction. This 
neglect is an affront to the repeated unanimous testimony we 
have received from tribal witnesses over the past several 
years.
    In short, the public lands in this country belong to the 
American people, and the Interior Department has a 
responsibility to ensure that companies drilling on them are 
doing so safely, and protecting our air and water. We already 
know that oil and gas companies are committing serious safety 
violations when drilling on public lands. A report issued last 
year by Democratic members of this Committee found that there 
were a total of 2,025 safety and drilling violations on Federal 
land that were issued to 335 companies drilling in 17 States 
between 1998 and 2011.
    Moreover, the current drilling regulations that companies 
repeatedly violate for well construction have not been updated 
in nearly 25 years, and reflect neither the significant 
technological advantages of hydraulic fracturing, nor the 
tremendous growth in its use.
    I look forward to hearing the testimony from our witnesses 
today, and I yield back.
    [The prepared statement of Mr. Cartwright follows:]

     Statement of The Honorable Matt Cartwright, a Representative 
               in Congress from the State of Pennsylvania

    Thank you Mr. Chairman.
    Mr. Chairman natural gas reserves now accessible all across the 
United States through the use of hydraulic fracturing techniques have 
the potential to reduce our dependence on foreign oil, lessen pollution 
that leads to global warming, reshape our manufacturing sector, and 
boost our economy. In fact, we are now producing more natural gas in 
America under President Obama than we ever have before. But we must 
ensure that we develop this resource safely and in a way that protects 
the environment.
    According to the Interior Department, 90 percent of all new wells 
drilled on public lands now employ hydraulic fracturing. As a result, 
the Interior Department has begun the process of conducting a 
rulemaking to govern the safety of hydraulic fracturing on public 
lands. Hydraulic fracturing, or ``fracking,'' is a topic with which we 
are well acquainted: just a few months ago the Full Committee held an 
oversight hearing on the BLM's upcoming regulation; last week Secretary 
Jewell discussed the issue in testimony when she appeared before this 
committee; and in less than one month the public comment period on 
those revised regulations will close.
    Establishing minimum safety and environmental standards for 
fracking processes has been my top priority since being elected to 
Congress. This is why the first bill I introduced, the FRESHER Act, 
closed loopholes for oil and gas companies in the Clean Water Act, and 
has garnered 55 cosponsors. And that is why today I am introducing the 
CLEANER Act, which will ensure that oil and gas companies test their 
waste to determine if it is hazardous, and if so, dispose of it using 
the safe methods that other industries already employ. I believe these 
reforms are crucial to implement basic standards for the entire 
country, and while Congress refuses to hold votes on these bills the 
Administration must lead the way on our public lands.
    The Republican Majority has claimed that federal regulation of 
fracking on America's public lands is not needed because states already 
have regulations in place. But state regulations vary widely in their 
requirements, the stringency of those requirements, and the efficacy 
with which they are implemented. That is why it is important for the 
Interior Department to put in place a regulatory floor to ensure that 
there are minimum protections in place on public lands in all states. 
As stated by Secretary Jewell last Wednesday, part of her job is to 
make sure the Interior Department is watching over the federal estate 
effectively.
    The bill we are considering today, however, has a far broader reach 
than just the proposed regulations on hydraulic fracturing. The bill 
purports to take away from the Department of the Interior all authority 
to regulate any part of the ``hydraulic fracturing process'' on public 
lands. These are very broad terms that have severe implications. For 
example, this bill would allow hydraulic fracturing to occur within any 
unit of the National Park System or any other federal land if permitted 
to do so under state law. Imagine a hydraulic fracturing well located 
next to the Grand Canyon National Park Visitors Center--if this bill 
were passed, the federal government would have absolutely no power to 
prevent that from occurring.
    It should be noted as well that this bill does not mention tribal 
authority, nor does it distinguish between federal lands and tribal 
lands held in trust by the federal government. As a result, the bill 
would grant states full control of tribal lands, so long as any 
``component of the hydraulic fracturing process'' is involved. This 
committee has had multiple hearings over the past two Congresses 
focusing on the important distinction between Indian lands and public 
lands, yet this bill fails to make such a distinction. This neglect is 
an affront to the repeated, unanimous testimony we have received from 
tribal witnesses over the past several years.
    In short, the public lands in this country belong to the American 
people and the Interior Department has a responsibility to ensure that 
companies drilling on them are doing so safely and that our air and 
water is protected. We already know that oil and gas companies are 
committing serious safety violations when drilling on public lands--a 
report issued last year by Democratic members of this Committee found 
that there were a total of 2,025 safety and drilling violations on 
federal land that were issued to 335 companies drilling in seventeen 
states between February 1998 and February 2011, 549 of which were 
classified as ``major'' by committee staff.
    Moreover, the current drilling regulations that companies 
repeatedly violate for well construction have not been updated in 
nearly 25 years and reflect neither the significant technological 
advances of hydraulic fracturing nor the tremendous growth in its use. 
Rather than relying on state regulations that vary widely in their 
requirements, the stringency of those requirements, and the efficacy 
with which they are implemented, we should be ensuring that DOI's rule 
is strengthened in a number of key areas such as public disclosure and 
availability of information, management of waste water and well 
construction. This bill proposes to nullify proper regulation of 
hydraulic fracturing by the Interior Department and will have severe 
consequences for all public and Indian lands.
    I look forward to hearing the testimony from our witnesses.
                                 ______
                                 
    Mr. Lamborn. Thank you.
    And now we will hear, as earlier stated, from the author of 
the legislation, along with myself, Representative Flores of 
Texas for 5 minutes.

STATEMENT OF THE HON. BILL FLORES, A REPRESENTATIVE IN CONGRESS 
                    FROM THE STATE OF TEXAS

    Mr. Flores. Thank you, Mr. Chairman. Chairman Lamborn, I 
want to thank you for holding this important hearing on H.R. 
2728, the Protecting States' Rights to Promote American Energy 
Security Act. I have submitted a comprehensive set of comments 
on the bill for the record, and I will summarize those key 
points in a few minutes.
    I would like to start out by exercising a little bit of 
personal privilege and recognize three important guests today. 
My wife, Gina, is with us today. My nephew, Landon, is with us. 
And also, we have an up-and-coming rising star among Texas 
elected officials, and that is Christi Craddick, the 
Commissioner of the Railroad Commission of Texas. I welcome 
each of you here.
    I have also told them about what comedy we have in this 
Committee, and how we all get along. And so I am hoping that 
will be on display today.
    This bipartisan-sponsored bill takes an important step 
toward reaffirming States' rights in determining energy 
production while providing a path forward for the House 
Republicans' goal of American energy security by the year 2020. 
This bill is also an important tool to grow good, American 
manufacturing jobs and reduce greenhouse gas emissions through 
the increased production use of abundant and efficient natural 
gas for our Nation's energy needs. You also heard the Ranking 
Member agree with those things just a few minutes ago.
    Before we go too much further today, I think it is 
important to look at several important facts when it comes to 
American energy.
    First, we are in the midst of an energy transformation in 
the way that we produce energy in this country cleanly, safely, 
affordably, and responsibly, through the use of proven 
technologies that continue to improve each year.
    Second, because of this energy revolution, we are now in a 
position to be energy secure by the year 2020. This is a goal 
we should pursue, just as we did in the 1960s to put a man on 
the moon in less than a decade.
    Third, this energy revolution has created hundreds of 
thousands of well-paying American jobs in the energy industry. 
More importantly, however, the energy from affordable and 
abundant natural gas has put America in a position to become 
globally competitive in manufacturing, and to create millions 
of great jobs for hard-working Americans that are currently 
worried about their family's future because of Washington 
policies.
    Fourth, the expanded use of clean-burning natural gas has 
helped us improve the environment by reducing greenhouse gas 
emissions. In fact, because of this, the U.S. has reduced its 
emissions of GHGs by nearly 12 percent over the last 10 years. 
It ranks first among major nations in the reduction of its 
carbon footprint.
    And if I could bring up chart number one, fifth, this 
resurgence of American energy production has occurred on State 
and privately owned lands, while energy production on Federal 
taxpayer-owned lands has declined over the last 5 years, 
because of the Obama Administration's war on America's oil and 
gas and coal companies, and the jobs that come from the 
employers in these industries.
    Sixth, increased production of American energy has huge 
potential to help fix our fiscal imbalances in two ways: by 
balance of trade improvements and by Federal deficit reduction.
    Seventh, with respect to hydraulic fracturing, there are at 
least 10 different Federal agencies--we will bring up chart 
number two--that are studying the potential imposition of new 
Federal rules to restrict hydraulic fracturing. This is being 
done, even though congressional statutes specifically exempt 
many oil and gas activities, including hydraulic fracturing, 
from relevant statutes. These statutes essentially leave the 
bulk of the regulation of the oil and gas operations to the 
States.
    Nonetheless, the Obama Administration is attempting to 
circumvent these exemptions by new rulemaking, change 
performance standards, and coordinate lawsuits with third-party 
environmental groups. This has resulted in numerous Federal 
agencies, including the Department of the Interior, attempting 
to restrict the use of this essential American energy 
technology.
    Eighth, the Obama Administration's assault on hydraulic 
fracturing is a solution in search of a problem that does not 
exist. Despite lots of rhetoric and innuendo, the Federal 
Government has found no evidence of groundwater pollution or 
significant environmental issues from hydraulic fracturing 
technology.
    If we go to chart three, you will see the testimony from 
one of two EPA Administrators, including Lisa Jackson, that 
have said that, ``I am not aware of any proven case where the 
fracking process itself has affected water.''
    If we go to the next chart, former BLM Director Bob Abbey 
testified that hydraulic fracturing is safe, and there have 
been no proven cases where hydraulic fracturing itself has 
affected groundwater.
    In chart number five, we see testimony from newly appointed 
Energy Secretary Ernest Moniz. He testified, ``There has been 
no incidents of groundwater pollution from the hydraulic 
fracturing process.'' He has also been a strong advocate for 
States having the primary role in regulating hydraulic 
fracturing.
    Just last week, the Department of Energy released results 
from an ongoing Federal study of hydraulic fracturing, 
suggesting that this drilling technique is not contaminating 
drinking water aquifers in the Marcellus Shale.
    These are eight important facts regarding today's American 
energy revolution. This discussion brings us to why we are here 
today, to stop the Federal Government's next big threat to the 
current American energy revolution, the assault on hydraulic 
fracking.
    In Congress we frequently address the powers of the States 
versus federalism on a myriad of issues, from health care to 
labor to education. The bill before us today is not a question 
of regulating or not regulating hydraulic fracturing. The bill 
before us today is about empowering local self-government and 
placing a check on the growth of an out-of-control, one-size-
fits-all Federal Government.
    I will end by posing a question. Why do we need two sets of 
regulation on any industry, when one set of effective and 
proven regulations is already working?
    Mr. Chairman, thank you again for holding this hearing on 
H.R. 2728, and I yield the balance of my time.
    [The prepared statement of Mr. Flores follows:]

       Statement of The Honorable Bill Flores, a Representative 
                  in Congress from the State of Texas

    Chairman Lamborn, I want to thank you for holding this important 
hearing on H.R. 2728, the Protecting States' Rights to Promote American 
Energy Security Act.
    This bill takes an important step toward reaffirming states' rights 
in determining energy production while providing a path forward for the 
House Republicans' goal of American Energy Security by the year 2020. 
This bill is also an important tool to grow good American manufacturing 
jobs and to reduce greenhouse gas emissions through the increased 
production and use of abundant and efficient natural gas for our 
nation's energy needs.
    Before we go too much further today, I think it is important to 
look at several important facts when it comes to American Energy:
         1.  First, we are in the midst of an energy transformation in 
        the way that we produce energy in this country--cleanly, 
        safely, affordably, and responsibly through the use of proven 
        technologies that continue to improve each year.
         2.  Second, because of this energy revolution, we are now in a 
        position to be ``energy secure'' by the year 2020; this is a 
        goal we should pursue, just as we did in the 60's to put a man 
        on the moon in less than a decade.
         3.  Third, this energy revolution has created hundreds of 
        thousands of well-paying American jobs in the energy industry. 
        More importantly, however, energy from affordable and abundant 
        natural gas has put America to be in a position to become 
        globally competitive in manufacturing and to create millions of 
        great jobs for hard working Americans that are currently 
        worried about their families' futures because of Washington 
        policies. This manufacturing revolution has happened in my very 
        own Texas district where low-cost electricity generated by 
        clean burning-natural gas has made the steel products produced 
        by Nucor Steel globally competitive. This plant in Jewett, 
        Texas employs almost 400 hard working Texans in well-paying 
        jobs and it is one of the largest taxpayers to the local school 
        district.
         4.  Fourth, the expanded use of clean burning natural gas has 
        helped us improve the environment by reducing greenhouse gas 
        emissions. In fact, because of this, the U.S. has reduced its 
        emissions of GHG's by nearly 12% over the last five years, it 
        ranks first among major nations in the reduction of its carbon 
        footprint.
         5.  Fifth, this resurgence of American energy production has 
        occurred on state and privately owned lands while energy 
        production on federal taxpayer owned lands has declined over 
        the past five years because of the Obama administration's war 
        on America's oil and gas and coal companies and the jobs that 
        come from the employers in these industries.
         6.  Sixth, the reduced importation of crude oil from unstable 
        regimes in the Middle East as well as the potential export of 
        liquefied natural gas, or LNG as it is more commonly known, has 
        the potential to improve American national security and to make 
        a huge change in the world's geopolitical balance. Imagine 
        this, what if we were no longer buying oil from the Middle East 
        and having our dollars being used to fund terrorist operations 
        against our interests at home and around the world.
         7.  Seventh, increased production of American energy has huge 
        potential to help fix our fiscal imbalances in two ways--by 
        balance of trade improvements and by federal deficit reduction. 
        Similarly, by manufacturing more American products here at 
        home, exporting energy, and importing less energy, abundant and 
        affordable energy can have dramatically improve our huge trade 
        deficits. By producing more American energy on federal taxpayer 
        owned lands and offshore areas, we can generate more revenues 
        from lease bonus payments and royalties that can be used to 
        reduce federal deficits. Furthermore, tax receipts from more 
        American manufacturing jobs and economic growth could help us 
        balance the budget in just a few years.
         8.  Eighth, one of the most important tools that has enabled 
        this American energy revolution is the improved use of 
        hydraulic fracturing technology. Without this technology, there 
        would be no American energy revolution and no way to be talking 
        about American Energy Security by 2020.
         9.  Ninth, with respect to hydraulic fracturing, there are at 
        least 10 different federal agencies that are studying the 
        potential imposition of new federal rules to restrict hydraulic 
        fracturing. This is being done even though Congressional 
        statutes specifically exempt many oil and gas activities, 
        including hydraulic fracturing, from relevant statutes. These 
        statutes essentially leave the bulk of the regulation of oil 
        and gas operations to the states. Nonetheless, the Obama 
        administration is attempting to circumvent these exemptions by 
        new rulemaking, changed performance standards, and lawsuits 
        with third party environmental groups. This has resulted in 
        numerous federal agencies, including the Department of 
        Interior, attempting to restrict the use of this essential 
        American energy technology.
        10.  Tenth, the Obama administration's assault on hydraulic 
        fracturing is a solution in search of a problem that does not 
        exist! Despite lots of rhetoric and innuendo, including a 
        couple of very misleading movies, the federal government has 
        found no evidence of ground water pollution or significant 
        environmental issues from hydraulic fracturing technology. This 
        fact is evidenced by the testimony of the last two EPA 
        Administrators, including Lisa Jackson; they and former BLM 
        Director Bob Abbey have testified that hydraulic fracturing is 
        safe and that there have been no proven cases where hydraulic 
        fracturing itself has affected groundwater. Recently, in 
        testimony before the House Science and Technology Committee, 
        newly appointed Department of Energy Secretary Earnest Moniz 
        testified that there has been no incidence of groundwater 
        pollution from the hydraulic fracturing process. Secretary 
        Moniz has also been a strong advocate for states having a 
        primary role in regulating hydraulic fracturing. Just last 
        week, the Department of Energy released results from an ongoing 
        federal study of hydraulic fracturing suggesting that this 
        drilling technique is in fact not contaminating drinking water 
        aquifers in a targeted area within the Marcellus Shale. During 
        that same time, energy production in the area where this DOE 
        study took place, has produced 234,000 jobs and added 1.6 
        billion in tax revenue to the state of Pennsylvania.
    These are ten important facts regarding today's American energy 
revolution. In general, it happened in spite of Washington, rather than 
because of it. As stated above, the effects of the energy policies of 
the Obama administration are most clearly evidenced by reduced energy 
production from federal taxpayer owned lands and offshore areas, the 
shutdown of 20% of our nation's coal-fired electricity generation, the 
loss of thousands of jobs from those shutdowns, and the blocking of the 
Keystone XL pipeline.
    This discussion brings to us to why we are here today--to stop the 
federal government's next big threat to the current American energy 
revolution--the federal assault on Hydraulic Fracturing. In particular, 
the Department of Interior, over which this Committee has Congressional 
oversight authority, has ignored our Constitution and ignored 
Congressional statutes by attempting to issue new federal regulations 
to control hydraulic fracturing. One of the reasons that my bill, HR 
2728, ``Protecting States' Rights to Promote American Energy Security 
Act'' was introduced is to recognize the most important fact not 
discussed above. That reason is simple--the reason that we have not 
experienced environmental problems with hydraulic fracturing is that 
the hydraulic fracturing operators and the states have effectively 
regulated this technology based upon real world experience over 60 
years and over one million hydraulic fracturing operations in the U.S.
    I think it would be helpful to first look at an analogy to 
understand the importance of hydraulic fracturing in the production of 
American oil and natural gas. Take this IPAD for instance; it is game-
changer that has transformed many aspects of the way we do business and 
communicate in America. This IPAD needs energy to operate, however, 
after a few hours of operation, it is useless without its charger; its 
promise disappears.
    Similarly, because of hydraulic fracturing and new drilling 
technologies, we now have a plentiful supply of environmentally 
friendly natural gas and growing supplies of American oil production; 
we can call this the IPAD of American Energy Security. In this analogy, 
hydraulic fracturing is the ``charger'' we need to enable these robust 
supplies of natural gas. If the federal government stops or excessively 
restricts hydraulic fracturing, it analogous to losing the charger to 
this IPAD. Eventually, natural gas production will begin to fall, 
supplies will diminish, prices will increase, and the opportunities to 
grow our manufacturing base and to become energy secure will evaporate; 
all because of misguided Washington policies.
    Recent statistics have shown that oil and natural gas activities 
have decreased significantly on federal lands compared to activity 
levels on state and private lands across the nation. Burdensome and 
duplicative federal regulations are largely responsible for this 
inhibited activity. Our states have a long and successful track record 
of regulating oil and natural gas operations including hydraulic 
fracturing, well construction, and management of produced water. H.R. 
2728 recognizes the effectiveness of state regulations by halting 
overreaching federal involvement in hydraulic fracturing operations.
    Today, you may hear a lot of rhetoric about the need to wean our 
country off of carbon fuel--I agree; but, we must do it in a manner 
that is based upon the technological realities of alternative fuels. We 
also need to do this without destroying the American economy in the 
process and without the federal government picking winners and losers. 
In short, today's hearing should address the real world and not a world 
that does not yet exist. Today's energy resources are the ``bridge'' 
that will power us to the carbon free world of the future. We shouldn't 
burn that bridge before we get to that future world.
    In Congress, we frequently address the powers of the states versus 
federalism on a myriad of issues from health care, to labor, to 
education. The bill before us today is not a question of regulating or 
not regulating hydraulic fracturing. The bill before us today is about 
empowering local self-government and placing a check on the growth of 
out-of-control one size fits all government. I will end by posing a 
question; why do we need two sets of regulations on any industry when 
one set of effective and proven regulations is already working?
    Mr. Chairman, thank you again for holding this hearing on H.R. 
2728. I also would like to welcome Railroad Commissioner Christi 
Craddick from my home state of Texas to testify before our 
subcommittee. I look forward to hearing from our witnesses today.
                                 ______
                                 
    Mr. Lamborn. All right. And I want to thank the Member for 
his statement, my colleague from Texas, also for his background 
and the knowledge he brings to this issue, and for the 
legislation that we have in front of us.
    We will now hear from our four witnesses. We have this 
morning Ms. Catherine Foerster, Chair and Engineering 
Commissioner of the Alaska Oil and Gas Conservation Commission; 
we have Ms. Christi Craddick, Commissioner of the Railroad 
Commission of Texas; we have Mr. John Rogers, Associate 
Director of the Utah Division of Oil, Gas, and Mining; and we 
have Ms. Lois Epstein, Arctic Program Director for the 
Wilderness Society.
    Like all of our witnesses, your written testimony will 
appear in full in the hearing record, so I ask that you keep 
your oral statements to 5 minutes. Our microphones are not 
automatic, so you have to push the button before you can get 
started.
    And I want to explain how our timing lights work. When you 
begin to speak, our clerk will start the timer and a green 
light will appear. After 4 minutes, a yellow light comes on. 
And after 5 minutes, a red light comes on. And I would ask that 
you conclude at that time.
    And we will now hear from Ms. Foerster. Thank you.

   STATEMENT OF CATHERINE P. FOERSTER, CHAIR AND ENGINEERING 
    COMMISSIONER, ALASKA OIL AND GAS CONSERVATION COMMISSION

    Ms. Foerster. Thank you, Chairman Lamborn, Ranking Member 
Cartwright, and members of the Subcommittee, for inviting me to 
testify today. The Alaska Oil and Gas Conservation Commission 
applauds Congressmen Flores and Lamborn for introducing this 
bill. The last thing the United States needs right now is 
duplicative regulation of an already stringently regulated 
process. Unless, of course, we need increased Federal spending 
and bureaucracy, delays in providing jobs, revenue, and 
affordable domestic energy, and one-size-fits-all regulations 
that are ignorant to regional differences. I believe my 
testimony will explain why I whole-heartedly support this bill.
    In arguing my support, let me first take you back a week to 
a hearing with this Committee and Secretary Sally Jewell. I 
feel that hearing created the potential for several 
misperceptions, and I would like to clear those up.
    Secretary Jewell's answers to questions from 
Representatives Lamborn, Fleming, and Mullin gave the 
perception that no national standard exists for hydraulic 
fracturing, that some States regulate using 30-year-old 
technology, and that States new to hydraulic fracturing have 
nowhere to go for help in establishing appropriate regulations. 
None of these statements are true.
    In America today, a State-funded NGO called the Interstate 
Oil and Gas Compact Commission, or IOGCC, located in Oklahoma 
City, represents the Governors of all oil and gas-producing 
States. The purpose of the IOGCC is to help all States in their 
regulation of oil and gas operations, including hydraulic 
fracturing. All Canadian Provinces with oil and gas operations 
also belong to IOGCC. IOGCC has guidance documents on a variety 
of oil and gas operations. They are very general, but they help 
States set high standards of environmental protection that are 
consistent with the varying engineering and geologic needs of 
each State.
    In addition, an organization borne out of a joint effort 
between DOE and API called STRONGER, for State Review of Oil 
and Natural Gas Environmental Regulations, exists to provide a 
national standard for environmental protection in all aspects 
of oil and gas operations, and a critical review of individual 
State regulations to ensure that the national standard is being 
met, and that the local issues are also being addressed. 
STRONGER consists of representatives from industry, 
environmental NGO's and State regulators, and addresses the 
concerns of all three groups. STRONGER convenes subgroups to 
address individual issues. One such subgroup deals specifically 
with hydraulic fracturing. I am part of that group. And this is 
a copy of the 2013 STRONGER guidelines. Section IX deals with 
hydraulic fracturing. To imply, as Secretary Jewell did, that 
no national standard for hydraulic fracturing exists, is not 
true.
    As for States needing help to address any new aspect of oil 
and gas regulations, States can, should, and do use the work 
already done by STRONGER and by the IOGCC and its member 
States. In fact, IOGCC even reaches out to States and provinces 
new to oil and gas, and invites them to join our compact. Also, 
during IOGCC's biannual meetings, members and guests sharing 
learning, so that if one State or province encounters a problem 
or issue, we all collaborate on the solution. So, to imply that 
State regulators have nowhere to go for help when they 
encounter hydraulic fracturing or any other new operation or 
technology, also not true.
    As for the State's regulations being old and out of date, 
again, not true. The IOGCC member States meet twice a year to 
review the latest technology advances and operating practices, 
with an eye to the need for regulatory changes. The IOGCC seeks 
out industry representatives to provide information at these 
meetings on new and changing technologies and operating 
practices. And as a State regulator for over 8 years, I assure 
you we are almost constantly updating one regulation or another 
to keep up with these changes.
    Almost 80 years ago the IOGCC had the good idea to develop 
model statutes, which they did. On top of that, we revisit the 
standards and our individual State regulations constantly, to 
ensure that they are up to date. More recently, STRONGER has 
developed a comprehensive set of guidelines for State 
regulation, specifically of hydraulic fracturing, and one that 
I helped to update less than a year ago. We certainly don't 
need to duplicate any of these efforts.
    There was also some discussion at that hearing of FracFocus 
and trade secret protection. I just want to remind the 
Subcommittee that the Uniform Trade Secrets Act is in place in 
47 States and the District of Columbia, and that FracFocus is, 
and any other disclosure mechanism would be, bound by the 
provisions of that Act.
    And keep in mind also that FracFocus requires that all 
ingredients be disclosed, it's just the quantities, in other 
words, the recipe of those ingredients, that is withheld as a 
trade secret.
    I would like to clear up one more misperception from the 
hearing. Representative Lowenthal suggested that FracFocus is 
privately run and there is no guarantee it will be maintained. 
Although funded by DOE and industry, it is maintained by 
another State-funded NGO, the Groundwater Protection Council, 
in association with the IOGCC. So the concern about FracFocus 
not being around in the future is also unwarranted.
    I am out of time. Thank you again, Mr. Chairman and Ranking 
Member, for allowing me to testify. I hope from my testimony 
you can see the rationale for my strong support of this bill, 
and my concern with adding unnecessary Federal regulations.
    [The prepared statement of Ms. Foerster follows:]

Statement of Catherine P. Foerster, Chair and Engineering Commissioner, 
               Alaska Oil and Gas Conservation Commission

    Thank you, Chairman Lamborn, ranking member Holt, and members of 
the Subcommittee on Energy and Mineral Resources for inviting me here 
today to discuss hydraulic fracturing regulation.
    The Alaska Oil and Gas Conservation Commission applauds Congressman 
Flores for introducing this bill and the members of this sub-committee 
for their interest in considering it. The last thing the United States 
needs right now is duplicative regulation of an already stringently 
regulated process, unless, of course, we need increased federal 
spending and bureaucracy; delays in providing jobs, revenue, and 
affordable domestic energy; confusion among operators and regulators; 
and one-size-fits-all regulations that are ignorant to regional 
differences.
    In my testimony I believe you will hear why I wholeheartedly 
support Representative Flores' proposed legislation. In arguing my 
support for this legislation, let me first take you back one week ago 
to a hearing with this very committee and Secretary Sally Jewell. I 
feel that hearing created the potential for several misperceptions and 
I'd like to clear those up.
    Secretary Jewell's answers to questions from Representatives 
Lamborn, Fleming, and Mullin gave the perception that no national 
standard exists for hydraulic fracturing, that some states regulate 
properly but others use 30-year-old technology, and that states that 
are just starting to deal with hydraulic fracturing have no place to go 
for help in establishing appropriate regulations. None of these 
statements is true.
    In America today a state-funded NGO called IOGCC (Interstate Oil 
and Gas Compact Commission), officed in Oklahoma City, represents the 
governors of all oil and gas producing states. Its very purpose is to 
help all states in their regulation of oil and gas operations, 
including hydraulic fracturing. All Canadian provinces with oil and gas 
operations also belong to the IOGCC.
    The IOGCC has a base set of guidance documents on a variety of oil 
and gas operations that is very general but that helps states set high 
standards of environmental protection that are consistent with the 
varying engineering and geologic needs of each state.
    In addition an organization born out of a joint effort between the 
DOE and API, called STRONGER (State Review of Oil and Natural Gas 
Environmental Regulations), exists to provide a national standard for 
environmental protection in all aspects of oil and gas operations and a 
critical review of individual state regulations to ensure that the 
national standard is being met and that the local issues are also being 
taken into account. STRONGER consists of representatives from industry, 
environmental NGOs and state regulators and addresses the concerns of 
all three groups. STRONGER convenes sub-groups to address individual 
issues. One such sub-group deals specifically with hydraulic 
fracturing. I am a member of that sub-group.
    To imply, as I believe Secretary Jewell did, that no national 
standard for hydraulic fracturing exists, is not true.
    As for states needing help to address any new aspect of oil and gas 
regulations, they can, should, and do use the work already done by 
STRONGER and by the IOGCC and its member states. In fact, IOGCC even 
reaches out to states and provinces new to oil and gas and invites them 
to join the compact commission. Also, during bi-annual meetings, 
members of the IOGCC and guests share learnings so that, if one state 
or province encounters a problem or issue, we all collaborate on the 
solution.
    To imply that state regulators have nowhere to go for help when 
they encounter hydraulic fracturing or any other new operation or 
technology is also not true.
    As far as the states' regulations being old and out-of-date, that 
is, again, not true. The IOGCC member states meet twice a year to 
review the latest technology advances and operating practices with an 
eye to whether any regulatory changes are warranted. The IOGCC seeks 
out industry representatives to provide information at these meetings 
on new or changing technologies and operating practices. And as a state 
regulator for over eight years, I assure you that we are almost 
constantly updating one regulation or another to keep up with 
technology advances and operating changes.
    Almost eighty years ago, the IOGCC had the good idea to develop 
model statutes, which they did. On top of that, we revisit the 
standards and our individual state regulations constantly to ensure 
that they are up-to-date. More recently STRONGER has developed a 
comprehensive set of guidelines for state regulation of hydraulic 
fracturing--one that I helped update less than one year ago. We 
certainly don't need to duplicate these efforts.
    There was also some discussion during that hearing of FracFocus and 
trade secret protection. I just want to remind the subcommittee that 
the Uniform Trade Secrets Act is in place in 47 states and the District 
of Columbia and that FracFocus is (and any other disclosure mechanism 
would be) bound by the provisions of that act. I'm not an attorney but 
I suggest you ask an attorney to answer the question of how this act 
affects access to the data industry wants held confidential. Another 
thing to keep in mind is that FracFocus requires that ALL ingredients 
be disclosed; it is simply the mix of those ingredients that is 
withheld as a trade secret.
    I'd like to clear up one more misperception from that hearing. 
Representative Lowenthal suggested that FracFocus is privately run and 
may not be maintained. Although funded by the DOE and industry, it is 
maintained by another state-funded NGO, the Groundwater Protection 
Council (GWPC) in association with the IOGCC. Thus, the concern about 
it being around in the future is unwarranted.
    As for Alaska in particular, approximately 25% of Alaska's wells 
have been hydraulically fractured and we have been performing hydraulic 
fractures for about forty years. Moreover in its history of oil and gas 
operations, Alaska has yet to suffer a single documented instance of 
subsurface damage to an underground source of drinking water. As long 
as each well is properly constructed and its mechanical integrity is 
maintained, (in other words as long as operators follow our 
regulations) hydraulic fracturing should have no potential to damage 
any fresh groundwater.
    The following paragraphs describe the current state of Alaska's 
regulation of hydraulic fracturing. However it should be noted that my 
commission is currently engaged in the deliberative process on proposed 
changes to these regulations. Proposed changes include fluid disclosure 
requirements (although all Alaska operators are currently disclosing 
voluntarily via FracFocus), water well sampling requirements, and 
adding a section titled ``hydraulic fracturing'' that either cites or 
refers to all our existing regulations that impact hydraulic fracturing 
operations. We are not creating this section because we currently have 
no regulations on hydraulic fracturing. Rather we are creating this new 
section simply to make it easier for the lay person to find the 
regulations that are currently scattered across a number of existing 
sections. For example the casing requirements are in the casing 
section, the cementing requirements are in the cementing section, and 
so on.
    The AOGCC's statutes and regulations, found in Chapter 5 of Title 
31 of the Alaska Statues and Title 20, Chapter 25 of Alaska's 
Administrative Code, apply to all oil, gas, and geothermal wells 
drilled in the state. These statutes and regulations include stringent 
well construction requirements that are designed to protect underground 
sources of water and ensure mechanical integrity during production and 
injection operations. The AOGCC has no specific section of its 
regulations entitled ``hydraulic fracturing'' but the requirements for 
mechanical integrity are found throughout our regulations. 
Additionally, the AOGCC is required by statute to take extra measures 
to protect underground sources of drinking water in ``nonconventional 
gas'' operations, including hydraulic fracturing operations. Non-
conventional gas includes coal bed methane and shale gas, both of which 
usually require production and disposal of significant amounts of water 
to establish and maintain gas flow.
    The AOGCC does not yet have any rules regarding disclosure of 
hydraulic fracturing fluids or baseline water well sampling, but we are 
in the deliberative process to consider these change and others. Under 
our current regulations, proposed fracturing programs are described in 
the application for permit to drill a new well (Form 10-401) or in an 
Application for Sundry Approvals (Form 10-403) when such work is 
planned on an existing well. Disclosure of the chemical composition or 
the anticipated volume of fluid is not currently required for either 
permit. However, Material Safety Data Sheets are required by federal 
law to be available on location. For hydraulic fracturing operations, 
these sheets list every chemical used in the fracturing process and 
must be disclosed to the AOGCC if requested. In instances where 
fracturing is proposed in a drilling permit application, volumes may or 
may not be included because completion interval thickness, permeability 
and other characteristics that determine required fluid volumes 
generally are not known before the well is drilled. The volume of fluid 
actually used must be disclosed in the final completion report for each 
fractured well.
    On the North Slope, Alaska's most prolific oil and gas province, 
freshwater is not a concern. In this part of Alaska, a thick layer of 
soil is underlain by permafrost--ground that remains frozen year 
round--so there is no liquid water, other than surface water, to a 
depth of 1,000 to 2,000 feet. Below the permafrost, only salt water is 
present, with very few exceptions. Regardless, wells on the North Slope 
are held to the same stringent construction requirements as other wells 
throughout the State.
    Wherever underground sources of drinking water are present, they 
are protected by Commission regulations. All operators are required to 
obtain advance approval for well work, including drilling. AOGCC staff 
engineers and geologists review all applications to ensure the proposed 
well construction is appropriate for the well's planned use. Well 
mechanical integrity requirements are the primary means for protecting 
drinking water. In order to operate, all wells must demonstrate 
competent barriers to prevent the flow of any fluids from the well to 
the surrounding rocks. These barriers are supplied by strings of pipe 
in the wells as well as cement and mechanical devices that pack-off 
(i.e., seal) the pipe. Every well must have a surface casing that is 
set below the base of the deepest formation that could potentially be a 
source of drinking water. That casing must be cemented completely to 
the surface. As a well is drilled deeper, every additional casing 
string must also be cemented sufficiently to restrict fluids to their 
native reservoirs. Testing of the barriers and evaluation of cementing 
records verify a well has competent barriers installed. Wells which 
cannot demonstrate competent barriers are required to be shut-in unless 
the operator can demonstrate to the Commission's satisfaction that 
redundant barriers exist to adequately protect the surface and 
subsurface environment.
    To assure compliance, every operator is required to install 
pressure measurement devices on every well and monitor those devices. 
If a measurement device indicates a compromise of the well's mechanical 
integrity, the operator is required to shut-in the well immediately and 
notify the Commission. In addition to these monitoring devices, the 
Commission requires periodic mechanical integrity tests on all 
injection wells. The AOGCC has six field inspectors who randomly 
witness the tests as they are performed. Regardless of whether or not 
an inspector is present for a pressure test, the operators are required 
to submit to the AOGCC documentation for every test conducted. All test 
information is reviewed thoroughly by AOGCC engineers. Unannounced 
inspections also assure regulatory compliance.
    A little more historical detail on the formation of STRONGER:
    In 1989, the Interstate Oil and Gas Compact Commission (IOGCC) 
formed a Council on Regulatory Needs composed of environmental and oil 
and gas regulators representing the major producing areas of the 
country. There were nine advisors and nine official observers. The 
Council was funded by a grant from EPA. At the first Council meeting 
all participants were invited to the table and the stakeholder process 
was established. This Council was charged with developing guidelines 
for state oil and gas exploration and production waste regulatory 
programs. In early 1990 the Council produced the 1990 Guidelines. The 
1990 Guidelines were organized by subject matter. They established 
environmental objectives for state regulatory programs. Fundamental 
differences exist from state to state, and within regions within a 
state in terms of climate, hydrology, geology, economics, and methods 
of operation. Consequently, regulatory programs vary in order to 
accommodate the differences in state administrative procedures, laws, 
and regulatory history. The Guidelines were used as a basis for state 
reviews. In 1993 the Guidelines were updated and revised to include 
abandoned sites and naturally occurring radioactive materials (NORM). 
Follow-up reviews to document changes resulting from recommendations 
contained in reports of initial reviews were initiated. In 1999, State 
Review of Oil and Natural Gas Environmental Regulations (STRONGER) was 
formed to manage the state review process. STRONGER received funding 
from EPA, DOE and API. The 1994 Guidelines were revised in 2000, 2005 
and 2010. Important additions were Spill Prevention, Performance 
Measures to evaluate how well state programs achieve their goals, 
Stormwater Management, and Hydraulic Fracturing. Hydraulic fracturing 
guidelines are currently being revised and air guidelines are under 
development.
    Thank you again, Chairman Lamborn and ranking member Holt, for 
inviting me to appear before your Subcommittee.
                                 ______
                                 
    Mr. Lamborn. Thank you.
    Ms. Craddick.

     STATEMENT OF CHRISTI CRADDICK, COMMISSIONER, RAILROAD 
                      COMMISSION OF TEXAS

    Ms. Craddick. Chairman Lamborn, Ranking Member Cartwright, 
and members of the Committee, my name is Christi Craddick, 
Commissioner of the Railroad Commission of Texas. Thank you for 
the opportunity to provide testimony in support of H.R. 2728. 
Texas has successfully regulated oil and gas production for 
almost 100 years, and knows better than the Federal Government 
how both to serve and protect the unique interests of our 
State. I am here today to provide my knowledge regarding the 
rules, regulations, and practices the State of Texas and the 
Commission have in place to safely and effectively regulate oil 
and gas exploration and production, and specifically the 
industry method of hydraulic fracturing, or fracking.
    Fracking has been a common industry practice in Texas for 
more than 60 years, and horizontal drilling, another pioneering 
technology, was developed in Texas by George P. Mitchell during 
the 1980s and 1990s. The energy industry in Texas has become 
the number-one job creator in terms of jobs created and 
compensation with over 427,000 oil and gas jobs in Texas in 
2012, averaging about $120,000 a year in salary. Also, the 
largest economic contributor, the oil and gas industry paid $12 
billion in State taxes in Fiscal Year 2012.
    The Commission has in place a successful and comprehensive 
regulatory framework to ensure that all oil and gas activities, 
including fracking, do not impact groundwater or surface water. 
Commission records do not indicate a single documented water 
contamination case associated with the process of fracking in 
Texas. And this is due to consistent and thoughtful regulation 
from within our State by regulators who know Texas best.
    In addition to the Commission's strict well construction 
requirements and rigorous regulatory oversight, Texas is 
blessed with geology that aids in our water protection efforts. 
With Texas's experience in exploration and production, free-
market practices and prime production conditions, the 
Commission has proactively developed regulatory oversight while 
allowing vast industry growth in innovation and increased 
production. In keeping pace with the advancements in the energy 
industry, the Commission has spent the past year evaluating 
rules to enhance our State's regulatory structure.
    In February 2012, the Commission implemented one of the 
Nation's most comprehensive chemical disclosure rules for 
fracking a well in Texas. It requires oil and gas operators to 
disclose chemical ingredients and water volumes used in the 
fracking treatment of oil and gas wells on the FracFocus 
Internet Web site, hosted by the Groundwater Protection Council 
and the Interstate Oil and Gas Compact Commission.
    In May of this year, the Commission amended its rules to 
update standards relating to the requirements for integrity 
testing of casing, cementing, drilling, well control, and well 
completion requirements. A recent case serves as an example to 
the differences in Texas and the Federal process.
    In 2010, the EPA issued an endangerment order for Southern 
Parker County while the Railroad Commission had an active and 
ongoing investigation into whether Range Resources' gas wells 
had contaminated water wells in the area. After the EPA issued 
an endangerment order, the Commission held an extensive 
evidentiary hearing regarding the matter to which the EPA was 
invited, but chose not to participate. From the time a 
complaint was received by the Commission to the signing of the 
final order, it took the Commission 7\1/2\ months to determine 
that Range's gas wells were not the source of the natural gas 
in the water wells. A full year after the Commission's final 
order, the EPA vacated its endangerment order against Range.
    Comparatively, Texas utilizes science and data to 
effectively and efficiently assess production activities that 
affect business within our State, while the Federal process is 
ineffective, inefficient, and cumbersome. A one-size-fits-all 
model does not work in Texas, as different rules for different 
States are most effective in adhering to different geography, 
geology, and environments. Texas energy regulation is based on 
rules, in contrast to permit or study-driven regulation. Free-
market principles guided by rules and processes in Texas allow 
companies to drill, so long as the rules are followed.
    While the oil and gas industry is one of the top economic 
drivers in Texas, we know that efficient and consistent 
predictable regulation within the energy industry is key to our 
State's economic success, and the success of domestic U.S. 
energy production.
    Thank you again for allowing me to testify, and for 
sponsoring this bill. And I look forward to questions.
    [The prepared statement of Ms. Craddick follows:]

             Statement of Christi Craddick, Commissioner, 
                      Railroad Commission of Texas

    Chairman Lamborn, ranking member Holt, and members of the Committee 
and Subcommittee:
    Thank you for the opportunity to provide testimony in support of 
H.R. 2728 (Flores), the Protecting States' Rights to Promote American 
Energy Security Act, recognizing States' authority to regulate oil and 
gas operations and promote American energy security, development, and 
job creation.
    Texas has successfully regulated oil and gas production for almost 
100 years and knows better than the federal government how to both 
serve and protect the unique interests of our state. As Commissioner of 
the Railroad Commission of Texas (Commission and/or RRC), I am here 
today to provide my knowledge regarding the rules, regulations and 
practices the State of Texas and the Commission have in place to safely 
and effectively regulate oil and gas exploration and production, and 
specifically the energy industry method of hydraulic fracturing, or 
fracing.
    Fracing has been a common industry practice in Texas for more than 
60 years. After Stanolind Oil introduced fracing in 1949, Halliburton 
conducted the first two commercial fracturing treatments in Stephens 
County, Oklahoma, and Archer County, Texas. Through the `80s and `90s, 
horizontal drilling, another pioneering technology was developed in 
Texas by George P. Mitchell. This technique combined with fracing, has 
opened the door and allowed operators to economically extract natural 
gas and other hydrocarbons from shale rock formations.
    As of December 2012, an estimated 2.5 million fracture treatments 
have been performed worldwide. It is estimated that approximately 60 
percent of all wells drilled today are hydraulically fractured. Fracing 
not only increases a well's production rate, but it is credited with 
adding 9 billion barrels (BBL) of oil and more than 700 trillion cubic 
feet (Tcf) of gas to U.S. reserves alone, which otherwise would have 
been too costly to develop.
    Much of the immense growth in production related to fracing and 
horizontal drilling has occurred in Texas, where energy production is 
booming. The Commission issued 22,479 drilling permits in 2012, a 
number consistent with a steady increase in drilling permits in the 
state from 9,716 permits issued in 2002. Well completions increased 
from more than 9,900 in 2010 (http://www.rrc.state.tx.us/data/drilling/
drillingsummary/2010/annual2010.pdf) to more than 15,000 in 2012 
(http://www.rrc.state.tx.us/data/drilling/drillingsummary/2012/
annual2012.pdf). Texas produces almost one third of total U.S. crude 
oil today. Currently, Texas' crude oil production averages 1.68 million 
barrels (MMbbl) per day. Natural gas production averages 19.31 billion 
cubic feet (Bcf) per day.
    Because the energy industry in Texas is exceedingly active, it has 
quickly become the number one job creator in terms of jobs created and 
compensation. In 2012, there were a total of 427,761 oil and gas jobs 
in Texas in every sector of the oil and gas industry arena including 
drilling, extraction, distribution, refining, manufacturing, machinery 
and equipment operation, wholesale, transportation and support 
activities, with an average salary of about $120,000 per year.
    An active energy industry in Texas has also generated substantial 
revenue for our state coffers. In fiscal year 2012, the oil and gas 
industry paid $12 billion in state taxes, up from $9.25 billion in 2011 
and $7.4 billion in 2010. In the last fiscal year, oil and gas 
severance tax income from oil production was 43 percent higher than 
estimated at $2.1 billion, and the natural gas production tax brought 
in $1.5 billion, 38 percent higher than estimated. Severance taxes make 
up the state's Rainy Day Fund, which currently has reserves of 
approximately $8 billion, and that number is projected to rise to $11.8 
billion by the end of the 2014-2015 biennium. Another $3.6 billion was 
collected in property taxes from oil and gas interests in fiscal year 
2012 and sales taxes totaled $2.5 billion.
    Not only is Texas the number one oil and gas producer in the United 
States with more than 298,000 active oil and gas wells (http://
www.rrc.state.tx.us/data/wells/welldistribution/
welldistribution062913.pdf), the state has a stellar environmental and 
public safety record, while fostering a job-creating industry. The 
Commission is recognized as a world leader and serves as an example 
across the globe in developing workable regulation for the energy 
industry and for its leadership in ensuring that resource recovery 
operations meet or exceed environmental and safety compliance 
standards.
    With experience comes knowledge, and the Commission has been 
regulating the oil and gas industry for more than 90 years, including 
oil and gas production, intrastate pipeline inspection and safety, 
utility rate cases pertaining to natural gas, and surface mining and 
reclamation oversight. While the Commission's headquarters is based in 
Austin, the agency has nine field offices throughout the state that 
work through inspections and case work in the field to ensure operators 
are adhering to our rules.
    Railroad Commission rules have set the precedent in guiding energy 
production regulations throughout the world. It is the mission of the 
Commission to serve Texas by the stewardship of natural resources and 
the environment, concern for personal and community safety, and support 
of enhanced development and economic vitality for the benefit of 
Texans. The Commission has in place a successful and comprehensive 
regulatory framework to ensure that all oil and gas activities, 
including fracing, do not impact groundwater or surface water. 
Commission records do not indicate a single documented water 
contamination case associated with the process of fracing in Texas, and 
this is due to consistent and thoughtful regulation from within our 
state by regulators who know Texas best.
    Texas' success in energy regulation has resonated throughout the 
world, driving many other nations' government officials to Texas to 
learn about our successful oversight processes. Last year, the agency's 
subject matter experts provided technical information on how the 
Commission regulates oil and gas exploration and production to 
dignitaries from Brazil, Turkmenistan, South Africa, Norway, China, 
Iraq, Italy, Canada, and Mexico. The Commission works to provide 
insight on processes in place that have allowed Texas to effectively 
oversee energy production for economic development while protecting the 
environment and public safety, so that others may replicate our state's 
successful model. As our agency has worked to continuously update and 
develop new rules and processes for effective regulation of an ever-
changing industry, regulators throughout the world have made efforts to 
learn from Texas' tried and true methods.
    Many of those methods have become standard practice within Texas 
and across the globe. Any time a well is drilled in Texas, including an 
oil, gas or injection/disposal well, Commission rules require that 
surface casing in the well be set below the depth of usable quality 
water to protect the state's water resources. Because usable quality 
water levels vary throughout the state, the Commission's Groundwater 
Advisory Unit performs an essential function in determining specific 
groundwater protection depths for each new well.
    The Commission's rules include strict well construction 
requirements that require several layers of steel casings and cement to 
protect groundwater. The first protection layer for usable quality 
groundwater in a well is the surface casing, a steel pipe that is 
encased in cement that reaches from the ground surface to below the 
deepest usable quality groundwater level. Surface casing acts as a 
protective sleeve through which deeper drilling occurs.
    The second protection layer for groundwater is the production 
casing, a pipe placed in the wellbore to the well's total depth and 
permanently cemented in place. Some operators inject fracturing fluid 
in this casing. Depending on the fracturing pressure needed, other 
operators use a third protection layer by injecting fracturing fluid in 
the tubing string that conducts the fracturing fluid to the zone to be 
fractured and then produced.
    For fracturing fluid to affect the usable quality water, a leak 
would have to escape several layers of casing protection and flow 
outside of the wellbore. For monitoring purposes, Commission rules 
require gauges for observation of these casings at the surface. If 
there is a problem down-hole, it is easily and quickly identified.
    In addition to the Commission's strict well construction 
requirements and rigorous regulatory oversight, Texas is blessed with 
geology that aids in our water protection efforts. Depending on the 
shale, fracing in Texas can typically occur a mile or more below 
aquifers, with many thousands of feet of isolating rock in between 
fresh water zones and the hydrocarbon-bearing zones that are 
hydraulically fractured.
    For example, freshwater zones vary throughout the Barnett Shale 
region in North Texas, which can range from the surface to a depth of 
2,000 feet. Before you get to the Barnett Shale formation, there is 
another 4,000 to 6,000 feet of isolating rock protecting the fresh 
water zones. The tight shale fracing that is occurring in the Barnett 
Shale is more than a mile deep at depths of between 6,000 and 7,500 
feet.
    In the Eagle Ford Shale in South Texas, the Carrizo Aquifer may be 
found from the surface to a 6,000 foot depth, while 3,000 to 8,000 feet 
of isolating layers of rock is found between the aquifer and the zone 
that is undergoing tight shale fracing at depths of between 8,000 and 
15,000 feet (Note: These dimensions are not uniform throughout the 
Eagle Ford Shale). While there are some areas in Texas where operators 
drill to shallower depths and use small-volume hydraulic fracture 
stimulation, the Commission's new rules address any increased risk.
    With Texas' experience in exploration and production, free market 
practices, and prime production conditions, the Commission has learned 
to proactively develop regulatory oversight, while allowing vast 
industry growth in innovation and increased production. In keeping pace 
with advancements in the energy industry, the Commission has spent the 
past year evaluating rules and processes to enhance our state's 
regulatory structure.
    In February 2012, the Commission implemented one of the nation's 
most comprehensive chemical disclosure rules for fracing a well in 
Texas. As of Feb. 1, 2012, the Commission requires Texas oil and gas 
operators to disclose chemical ingredients and water volumes used in 
the fracing treatment of oil and gas wells on the FracFocus internet 
website hosted by the Ground Water Protection Council (GWPC) and the 
Interstate Oil and Gas Compact Commission (IOGCC) at: http://
fracfocus.org/. Texas is one of the first states to require making this 
information accessible to the public.
    In May 2013, the Commission amended its rules to update standards 
relating to the requirements for integrity testing of casing, 
cementing, drilling, well control, and well completion requirements. 
For wells spudded on or after Jan.1 2014, operators in Texas will be 
required to: Adhere to new minimum standards for casing and cement to 
reflect best management practices already being used by most operators; 
Set minimum cement sheath thicknesses for various casing strings; 
Control annular gas migration; Test casing integrity throughout the 
drilling process; Isolate potential flow zones, zones with corrosive 
formation fluids, and zones being used for underground injection; 
Follow additional requirements for wells on which hydraulic fracturing 
treatment(s) will be conducted; and Receive Commission approval of any 
proposal to set surface casing to a depth of 3,500 feet or greater;
    Recognizing concerns about water use, several companies have 
applied for, and the Commission has approved, recycling projects to 
reduce the amount of fresh water used for fracing statewide and 
specifically in South Texas, a result of increased development in the 
Eagle Ford Shale. In March of this year, the Commission amended its 
rules to remove regulatory roadblocks and encourage recycling of such 
production fluids. In April, the amended recycling rules became 
effective and were designed to encourage recycling and reduce the use 
of fresh water to continue operators' water conservation efforts during 
fracing operations.
    By removing regulatory hurdles, the Commission fosters industry 
recycling efforts as operators continue to examine ways to reduce 
freshwater use when fracing wells. The new rules are designed to 
authorize non-commercial recycling under specified conditions if 
operators are recycling fluids on their own leases or transferring 
those fluids to another operator's lease for recycling. The new rules 
identify more clearly the Commission's commercial recycling permit 
application requirements and permit conditions. The Commission also 
adopted amendments to its commercial recycling rules. The revisions 
clarify the application requirements for commercial recycling 
operations for both solids and liquids and expand the two existing 
categories to five, to more accurately reflect the range of recycling 
practices currently used in the industry. The amendments establish a 
tiered approach for the reuse of treated fluid, including both 
authorized reuse of treated fluids in oil and gas operations and 
provisions for reusing the fluid for other non-oilfield related uses.
    Through thoughtful processes and careful assessments, the 
Commission ensures that we have the sophistication to effectively 
regulate one of the most technologically advanced industries in the 
world. A recent case serves as an example to the differences in the 
Texas and federal process in assessing and efficiently and effectively 
regulating drilling. In 2010, EPA issued an endangerment order for 
southern Parker County even though the Railroad Commission had an 
active and ongoing investigation into whether Range Resources gas wells 
had contaminated water wells in the area.
    After EPA issued an endangerment order, the Commission held an 
extensive evidentiary hearing regarding the matter to which EPA was 
invited but chose not to participate. The outcome of the hearing was 
that Range's gas wells were not the source of the natural gas in the 
water wells.
    The primary difference between EPA findings and the Commission's 
findings is that the EPA relied solely on a comparison of isotope data 
from Barnett Shale production gas to natural gas that occurred in Mr. 
Lipsky's water well, whereas the Commission's findings were based on 
multiple lines of evidence (i.e., well integrity testing, microseismic 
data, an evaluation of local geology and other sources of natural gas, 
and testing of both production gas and gas in the bradenhead) that 
showed that Range's Barnett Shale gas wells were not causing 
contamination.
    The mindset in Texas and federal processes in using science and 
data to effectively assess and regulate oil and gas exploration and 
production activities appear to be vastly different in this case. 
Moreover, it cannot be emphasized enough that EPA has since vacated its 
order against Range. A timeline of EPA and Commission actions in the 
Range Investigation is set out in the attached Appendix A.
    Like all forms of energy production, fracing entails risks, but 
offers the prospect of economic and environmental benefits when 
properly regulated. As the production of energy through fracing 
continues, we must continue to study this technology and ensure that it 
is done safely. Texas and state regulatory bodies alike are best fitted 
for the task of overseeing the safe production of their resources 
within their boundaries for a number of reasons.
    Texas and other energy producing states are quickly adapting and 
familiarizing their communities with oil and gas exploration and 
production processes. We are working to strengthen shale gas 
regulations to tighten well construction and waste disposal standards 
and requiring disclosure of fracing fluid ingredients, bringing 
together all interested parties, industry and environmental groups, in 
the process.
    Texas has developed a regulatory system that fits our state's 
varying drilling conditions throughout different regions. A one size 
fits all model does not work in Texas, as different rules for different 
states are most effective in adhering to differing geography, geology, 
and environments. Operators will use different drilling specifications 
and methods, depending upon the location of the well site; and Texas' 
rules reflect these considerations. Regulatory bodies throughout the 
U.S. have overseen oil and gas development in their respective states 
for decades, and they know their issues well.
    Not only are states more familiar with the intricacies of the 
geology in which their operators are drilling, but the majority of both 
the benefits and costs of fracing fall on states and local communities. 
Texas has experienced a direct gain from added jobs and tax revenue; 
and also properly manages pollution risks (the Commission does not have 
jurisdiction over traffic & noise). Therefore, the Commission is in the 
best position to figure out how best to balance the positive and 
potential negative facets of fracing.
    Individual regulatory bodies are balancing benefits and risks in 
their own ways. We should continue to let individual regulatory bodies 
devise local solutions to local conditions. As our nation nears energy 
independence due to increased domestic production, it is important now 
more so than ever that energy producing states are not over-burdened by 
federal regulations that may stifle production growth.
    While every regulatory body has their own model of how to regulate 
energy production within their borders, Texas too has developed its own 
case study on how to best regulate oil and gas exploration and 
production. Texas energy regulation is based on rules in contrast to 
permit- or study-driven regulation. Texas regulation is based in free 
market principles guided by rules and processes that allow companies to 
drill, so long as rules are followed. The cost to drill a well in Texas 
depending on geological location of the drill site and techniques used 
can be anywhere from $1 million to $5 million. Operators invest vast 
amounts of money in time in drilling operations that they hope to see 
successful.
    Furthermore, Texas drilling permits are issued somewhere between 2-
5 days. Unnecessary, cumbersome federal oversight will slow Texas' 
current efficient processes. While the oil and gas industry is one of 
the top economic drivers in Texas, we know that efficient, consistent 
and predictable regulation within the energy industry is the key to our 
state's economic success, and the success of domestic U.S. energy 
production.
    Thank you again, Chairman Lamborn and ranking member Holt, for the 
opportunity to testify before your Subcommittee and for your attention 
to this legislation. The Railroad Commission of Texas applauds 
Congressman Flores for introducing this bill and the members of this 
subcommittee for their interest in considering it. I would be happy to 
answer any questions you might have regarding my testimony.

                               Appendix A

   Timeline of EPA and Commission Actions in the Range Investigation

    August 6, 2010: Water well owner, Mr. Steven Lipsky, filed a 
complaint of natural gas in a domestic water well. In response to the 
complaint, Commission District 7B (Abilene) staff initiated an 
investigation that included testing the domestic water well for 
presence of oil field contamination and inspecting the nearby Range gas 
production wells [Butler Unit Well No. 1H (Butler Well) and Teal Unit 
Well No 1H (Teal Well) in the Newark, East (Barnett Shale) Field, Hood 
County, Texas].
    August 17, 2010: U.S. EPA, Region 6, Water Enforcement Branch first 
contacted the RRC Abilene District Office, which agreed to carbon copy 
EPA on all complaint correspondence.
    August 26, 2010: Mr. Lipsky advised RRC Abilene District Office he 
intended to disconnect his water well from the house.
    October 2010: EPA technical staff contacted Abilene District Office 
staff requesting to discuss plans to collect gas samples from the 
Lipsky water well and the Butler Well. EPA staff informed District 
Office staff that the EPA was considering issuing an endangerment 
order; however, EPA did not issue formal communication on this point to 
the Abilene office or RRC staff in Austin.
    October 21, 2010: In a phone conversation, EPA technical staff 
informed RRC staff that EPA planned to collect a gas sample from the 
Lipsky well and a gas sample from the production casing of the Range 
production wells. RRC staff recommended that EPA also sample the 
bradenhead gas of the Range production wells, but EPA staff declined 
the recommendation.
    October 26, 2010: EPA staff collected several samples from the 
Range production site including gas samples and produced water samples. 
RRC staff witnessed the collection of the samples. Range also collected 
samples of gas, including bradenhead gas. During discussion among the 
parties present about previous environmental investigations, RRC was 
informed that air monitors had been placed at various locations in the 
Lipsky home. However, no specific date of placement was noted.
    November 23, 2010: EPA staff emailed analytical results to RRC 
staff and invited RRC staff to a meeting with Range scheduled for 
December 2, 2010.
    December 1, 2010: EPA technical staff contacted RRC technical staff 
to advise that the meeting with Range will not occur because Range has 
declined the invitation. EPA staff also notified RRC staff that EPA 
planned to issue an endangerment order under Section 1431 of the Safe 
Drinking Water Act [42 U.S.C. Sec. 300(i)(a)], based on recent isotope 
data that it believed connects Range's operations to gas in the Lipsky 
well.
    December 2, 2010: EPA staff calls the RRC to share same 
information. RRC technical staff and EPA technical staff discuss the 
endangerment order. EPA staff read a statement from the draft 
endangerment order indicating that ``RRC has not taken action to 
date.'' RRC staff disagreed with that statement and suggested the 
following alternate statement ``although RRC is investigating the 
complaint, the RRC has not taken enforcement action to date.'' EPA 
staff also said that it would issue a press release, not to occur 
before the following Monday, December 6, 2010.
    December 3, 2010: EPA regional administrator contacted RRC chairman 
to advise of the planned endangerment order. EPA called RRC staff to 
ask about other occurrences of gas in shallow sands. RRC returned call 
and advised of two other complaints in area. EPA requested copies of 
the files. RRC staff began gathering information on other water well 
complaints, per EPA request. Range sends a letter to RRC agreeing to 
take additional actions. RRC staff notifies EPA staff of the Dec. 3 
letter from Range and emails a PDF of the letter to EPA staff.
    December 6, 2010: EPA sent the following email to RRC staff: ``As 
you are aware, the EPA is concerned about the safety of the private 
drinking water wells in Parker and Hood County that are near the Butler 
and Teal gas production wells. The EPA wants to make sure that all of 
the drinking water wells in this area are safe and not subject to 
methane contamination. Does the Railroad Commission of Texas have plans 
to sample these wells in the near future?''
    December 7, 2010: RRC staff replied to EPA's December 6 email, and 
advised EPA staff that the RRC has an ongoing investigation and is 
gathering information about occurrences of gas in other water wells in 
the area. RRC sends PDF's of two other water well complaints in the 
area to EPA staff.
    December 7, 2010: EPA issues the Emergency Administrative Order 
(Docket No. SDWA-06-2011-1208) against Range.
    December 8, 2010: RRC issues a Notice of Hearing to consider 
whether operation of the Range Production Company Butler Unit Well No. 
1H and Teal Unit Well No. 1H in the Newark, East (Barnett Shale) Field, 
Hood County, Texas are causing or contributing to Contamination of 
Certain Domestic Water Wells in Parker County, Texas.
    January 19-20, 2011: RRC hearings examiners hold a 2-day hearing in 
Austin. Appearances were made by Range, RRC staff, Enervest Operating 
Company, and the Texas Alliance of Energy Producers. Neither EPA nor 
the owners of the two water wells participated in the hearing.
    March 22, 2011: Commissioners Elizabeth Ames Jones, Michael 
Williams and David Porter signed a Final Order, which stated that, 
based on the evidence presented at the Hearing, the examiners 
concluded, and the Commissioners agreed, that gas in the water wells is 
from the Strawn Formation, which is in direct communication with the 
Cretaceous aquifer in which the water wells are completed. There was no 
evidence to indicate that either natural gas production well is the 
source of the gas in the water wells. This conclusion was supported by 
the following evidence found by the Commission hearing examiners:
          The appropriate geochemical parameters for 
        fingerprinting to distinguish Strawn gas of Pennsylvania age 
        from Barnett Shale gas of Mississipian age are nitrogen and 
        carbon dioxide, not carbon. Gas from Pennsylvanian age rock, 
        including Strawn, has higher nitrogen concentration and lower 
        carbon dioxide concentration than Barnett Shale gas. Gas found 
        in the water wells does not match the nitrogen fingerprint of 
        Barnett Shale gas. The gas found in the water wells matches 
        Pennsylvanian gas.
          Bradenhead gas samples from both water wells do not 
        match Barnett Shale gas, confirming that gas is not migrating 
        up the wellbores and that the Barnett Shale producing interval 
        in the Butler and Teal wells is properly isolated.
          3-dimensional seismic data indicates no evidence of 
        faulting in the area of the water wells.
          Microseismic data available for more than 320 
        fracture stimulations in Parker County indicated a maximum 
        fracture height of approximately 400 feet, meaning that almost 
        one mile of rock exists between the highest fracture and the 
        shallow groundwater aquifer.
                                 ______
                                 

  Response to Questions Submitted for the Record by Christi Craddick, 
               Commissioner, Railroad Commission of Texas

Chairman Lamborn:
    I am happy to provide the below responses to Rep. Holt's subsequent 
questions following my testimony in support of H.R. 2728 (Flores), the 
Protecting States' Rights to Promote American Energy Security Act, 
recognizing States' authority to regulate oil and gas operations and 
promote American energy security, development, and job creation, before 
the Committee on Natural Resources, Subcommittee on Energy and Mineral 
Resources legislative hearing on July 25, 2013.
1.  Commissioner Craddick, you state that, ``Unnecessary, cumbersome 
        federal oversight will slow Texas' current efficient 
        processes.'' Is there a lot of federal land in Texas? Is there 
        a lot of federal production in Texas? It appears that the BLM's 
        proposed rules would have negligible, if any, impact on Texas' 
        regulatory program, since their proposal only applies to 
        operations on federal oil and gas leases.
    RESPONSE: Approximately 1.8 percent of land in Texas is held in 
trust by the federal government, and that 1.8 percent encompasses 
2,977,950 acres of land. As of December 2012, the total number of 
leases in effect on federal land in Texas is 648. Since 2003, Texas has 
averaged 680.2 leases in effect on federal land. The number of federal 
acres under lease as of the last day of fiscal year 2012 in Texas is 
377,454 acres. Since fiscal year 2003, Texas has averaged 446,098.6 
federal acres of land under lease. The number of producing acres on 
federal lands as of the last day of fiscal year 2012 in Texas is 
155,006 acres. Since fiscal year 2003, Texas has averaged 129,554.8 
producing acres on federal lands. There are a number of producing 
states with similar successful regulatory policies that have much 
larger percentages of federal land and production occurring on that 
land; specifically, Alaska (69.1), California (45.3), Colorado (36.6), 
Idaho (50.2), Montana (29.9), New Mexico (41.8), Utah (57.4), and 
Wyoming (42.3).
    In my testimony, I commented on the impact duplicative federal 
oversight would have on Texas' energy production. I expressed my firm 
belief and will stress again that any policy allowing for dual 
oversight of Texas' energy production would have negative repercussions 
on that production in Texas, and in any state already having similar 
successful regulatory policies in place.
2.  Commissioner Craddick, you mention that ``many of [Texas'] 
        hydraulic fracturing practices have become standard practice 
        across the globe.'' Indeed, the BLM has taken yours and other 
        states' regulatory systems into account in creating their draft 
        regulations. But the proposed legislation today takes away the 
        authority of the federal government to regulate its own lands, 
        and instead creates a state by state approach--potentially with 
        50 different regulatory bodies--that have no minimum standards. 
        If your system can be used as a model for China, Brazil, 
        Mexico, and others, why is it not good enough for the American 
        people on public lands?
    RESPONSE: My testimony reinforces that states' regulatory policies 
for energy production are best for the American people on public and/or 
private land, and affirms that duplicative federal regulations on 
public land will hinder that production. As we are collaborating with 
governments throughout the world, Texas has first and foremost 
communicated directly with other states in working towards developing 
and revising regulations within our state. Texas and the Railroad 
Commission, as well as other states, have been active for decades in 
several collaborative national organizations in an effort to facilitate 
discussion and problem strategy amongst energy producing states. These 
organizations include the Interstate Oil and Gas Compact Commission 
(IOGCC), the Ground Water Protection Council (GWPC), and State Oil and 
Natural Gas Environmental Regulations (STRONGER, Inc.).
    The Railroad Commission and other states are in constant contact to 
discuss possible solutions to mutual issues. For example, the Railroad 
Commission recently updated its drilling and completion rules (16 Texas 
Administrative Code Sec. 3.13) and reviewed and discussed other states' 
regulations to determine whether they faced similar issues and how they 
handled those issues. In addition, the Railroad Commission and the 
Louisiana Department of Natural Resources entered into a memorandum of 
agreement with respect to proposed disposal wells close to our 
respective borders, including in the Haynesville Field, which is 
located in West Louisiana and East Texas.
    I feel strongly that states should develop, maintain and carry out 
regulatory policies related to energy production within their 
respective borders versus federal regulation of states' energy 
production. States are most efficient and effective in this 
responsibility, and States are much more effective in encouraging oil 
and gas exploration, development and production, while still protecting 
the environment and human health. It is clear that federal law and 
regulations detract operators from investments on federal lands, 
driving them towards production on non-federal land that is governed by 
greater regulatory certainty. Since 2012, all of the increases in oil 
and gas production have been on non-federal lands. A recent 
Congressional Research Service report (U.S. Crude Oil and Natural Gas 
Production in Federal and Non-Federal Areas, Congressional Research 
Service Report for Congress, March 7, 2013) demonstrates that, since 
2007, production of natural gas on federal lands fell by 33 percent, 
while production on state and private lands grew by 40 percent. In 
2012, crude oil production on federal lands was below 2007 levels but 
grew by 35 percent on non-federal lands.
    States are more efficient in reviewing and processing permit 
applications. For example, in Texas, an operator generally may obtain a 
drilling permit in two to five days. Other states have similar permit 
processing timeframes. Although this most recent proposal eliminates 
some requirements that would have greatly delayed the processing of 
applications and approval to drill and perform hydraulic fracturing, 
the proposed revised rule will still cause further delay in drilling 
for and producing oil and gas resources. I understand that BLM 
currently takes 180-290 days to process an application for a permit to 
drill. I am aware that it can take up to a year for BLM to issue a 
permit to drill. BLM has indicated that it will need an additional 
28,560 man hours per year to implement the proposed rules. Imposition 
of additional regulations are likely to result in an increase in the 
amount of time needed by BLM for approval of drilling permits and, 
therefore, a greater delay in production on federal lands.
    States are more knowledgeable about the unique basins within their 
boundaries. State regulators base standards and requirements on known 
risk, accepted science, and proven engineering practices, as well as 
acknowledged differences between regions based on geography, geology, 
hydrology, and historic conditions. I understand that BLM has no staff 
actually posted in Texas and that the nearest staff is posted in New 
Mexico. While states do a good job in regulating hydraulic fracturing 
and work towards fine-tuning their regulatory frameworks, the federal 
government should applaud these efforts, not undercut states' 
authority.
    The BLM proposed rule that you mention would unnecessarily 
duplicate state regulation. BLM stated that the proposed rule is 
intended to complement the efforts of some states, including Texas, 
that have recently revised their hydraulic fracturing regulations. 
However, the rule duplicates, rather than complements, existing state 
regulations of hydraulic fracturing that address well-bore integrity, 
flowback water, and require the disclosure of hydraulic fracturing 
constituents. And, BLM has not indicated how it believes that the state 
regulations are inadequate. BLM stated in the preamble that ``a major 
impetus for a separate BLM rule is that States are not legally required 
to meet the stewardship standards applying to public lands and do not 
have trust responsibilities for Indian lands under Federal laws.'' 
However, BLM includes no discussion of how BLM's ``stewardship 
standards applying to public lands'' differ from similar state 
responsibilities. As stated in the preamble, the ``Federal Land Policy 
and Management Act (FLPMA) directs the BLM to manage the public lands 
so as to prevent unnecessary or undue degradation, and to manage those 
lands using the principles of multiple use and sustained yield. FLPMA 
defines multiple use to mean, among other things, a combination of 
balanced and diverse resource uses that takes into account long-term 
needs of future generations for renewable and nonrenewable resources. 
FLPMA also requires that the public lands be managed in a manner that 
will protect the quality of their resources, including ecological, 
environmental, and water resources.'' This directive is virtually the 
same directive given to responsible state agencies for all lands within 
the boundaries of the state.
    BLM has failed to note any state with insufficient hydraulic 
fracturing regulations already in place. As this proposed rule is 
duplicative and cumbersome and creates undue cost to operators with no 
further safeguard to our environment, this rule is unnecessary in 
states currently regulating hydraulic fracturing. Furthermore, it is 
clear that leaving the management of federal lands up to state 
regulators would result in an increase in exploration, development and 
production of oil and natural gas, and a subsequent increase in federal 
revenues to offset the nation's staggering and rapidly growing debt.
    Thank you again, Chairman Lamborn, for the opportunity to present 
my thoughts on this legislation. I would be happy to answer any further 
questions you might have regarding my testimony.
                                 ______
                                 
    Mr. Lamborn. Thank you, Ms. Craddick.
    Now, Mr. Rogers.

STATEMENT OF JOHN C. ROGERS, ASSOCIATE DIRECTOR, UTAH DIVISION 
                    OF OIL, GAS, AND MINING

    Mr. Rogers. Good morning, Chairman Lamborn and Committee 
members. I appreciate the opportunity to appear before you 
today.
    The Utah Division of Oil, Gas, and Mining manages the 
permitting of regulation and monitoring of oil and gas and 
drilling class two injection wells, and oil and gas disposal 
facilities in Utah. This includes hydraulic fracturing, which 
it has regulated for many years, which is a primary focus of 
today's hearing.
    Hydraulic fracturing has been operational practice for 
completing and stimulating oil and gas wells in Utah since the 
early 1960s. In all the historical records of the Division, 
there has never been a verified case of hydraulic fracturing 
causing or contributing to contamination of water resources. 
The Division has always had very stringent rules concerning 
wellbore construction and the protection of water resources.
    However, to make the process of hydraulic fracturing more 
transparent and alleviate the recent public fear of the 
process, the Division adopted a formal rule in October of 2012. 
This rule combined many of the Division's existing rules 
concerning overall best management practices for oil and gas 
production related to safe, efficient operations, as well as 
requiring public disclosure of the chemicals used in the 
hydraulic fracturing process.
    There are three major concerns that have come to the 
forefront concerning hydraulic fracturing. The BLM has 
presented these in their proposed rules, and Utah has addressed 
them both historically and with their current rule: first, to 
provide public disclosure of the chemicals used in hydraulic 
fracturing; second, to include regulations to ensure wellbore 
integrity; and, third, to address issues related to flowback 
water.
    First, public disclosure. The Utah rule requires operators 
to report to FracFocus within 60 days of completion of a 
hydraulic fracturing operation of the chemicals used in the 
process. The primary purpose of FracFocus is to provide factual 
information concerning hydraulic fracturing and groundwater 
protection.
    FracFocus is a national hydraulic fracturing chemical 
registry accepted by both industry and government. It is 
managed by the Groundwater Protection Council and the 
Interstate Oil and Gas Compact Commission, two organizations 
whose missions both revolve around conservation and 
environmental protection. The site was created to provide the 
public access to reported chemicals used for hydraulic 
fracturing at specific well locations. This reporting process 
that the Division uses is the exact same as proposed by the BLM 
rule.
    Second, wellbore integrity. Existing rules are already in 
place to ensure wellbore integrity and construction. This 
includes detailed rules on casing and cementing, blowout 
prevention and uncontrolled flow, protection of freshwater 
aquifers, and casing pressure tests. The Utah rule emphasizes 
the use of already-existing rules that have managed oil and gas 
production in Utah for many years. The regulatory process of 
the Division are effective in ensuring the responsible 
development of Utah's resources with due regard for protection 
of environment. This begins with wellbore integrity.
    The professional staff at the Division have local knowledge 
and expertise to address the technical and scientific 
challenges posed by Utah's unique geology and geography. A 
nationwide process of hydraulic fracturing and rulemaking would 
be no more effective in achieving better oversight of hydraulic 
fracturing operations than exist at the State level in Utah and 
other States with similar rules.
    In addition, substantial cost of manpower and time for both 
government and private-sector organizations would be incurred.
    On-site inspections of oil and gas wells are a key 
component of the Division's regulatory program. All wells 
drilled on State or private lands in Utah are subject to a 
rigorous inspection program that includes inspection and 
witnessing of well control equipment tests, casing and 
cementing operations, and drilling operations, to name a few.
    In 2012, 8,983 such onsite inspections were performed by 
the Division's field operations staff. Through a detailed and 
very comprehensive geologic study, the depth of the usable 
groundwater has been mapped in the primary oil and gas-
producing areas of Utah, the Uintah Basin, recognizing the 
usable water and its protection is of primary concern when 
developing a casing program for a potential well.
    Third, the management of flowback water and surface 
protection. The Division's rules state the operators shall take 
all reasonable precaution to avoid polluting lands, streams, 
lakes, reservoirs, natural drainages, and underground water. 
Prior to any drilling operations, all drill sites have onsite 
inspection and are analyzed for surface conditions, and best 
practices are employed to prevent any contamination of surface 
water or ground water. The Division Board has recently approved 
new rules entitled ``Waste Management and Disposal.'' These 
rules update methods for disposal of RCRA-exempt waste for oil 
and gas production. This would include the management of 
hydraulic fracturing fluid flowback.
    Most wells in Utah, the production water is injection, 94 
percent of that amount, with 6 percent going to evaporative 
ponds.
    The Board has recently approved new rules which include 
chemical testing, subsurface and surface geology, size and 
depth limitations to these wells.
    I believe that Utah Division does an excellent job in 
monitoring hydraulic fracturing and oil and gas operations in 
Utah. It is also my experience that other States also perform 
at this similar exceptional level. It would seem redundant to 
add further rules, as proposed by the EPA's fracturing study 
and the proposed BLM rule, when many States have been managing 
the oil and gas operations, including hydraulic fracturing, for 
many years. Thank you.
    [The prepared statement of Mr. Rogers follows:]

          Statement of John C. Rogers, Associate Director of 
       The Division of Oil, Gas and Mining for The State of Utah

    My name is John Rogers and I am the Associate Director of the 
Division of Oil, Gas and Mining for the State of Utah (DOGM). The 
Division manages the permitting, regulation and monitoring of oil and 
gas drilling, Class II UIC injection wells and oil and gas disposal 
facilities in Utah. This includes hydraulic fracturing which it has 
regulated for many years, which is the primary purpose of this hearing.
    Hydraulic fracturing (HF) has been an operational practice for 
completing and stimulating oil and gas wells in Utah since the 1960's. 
State government regulation of the oil and gas industry commenced with 
creation of the Utah Oil and Gas Conservation Commission in 1955. In 
all of the historical records of DOGM, there has never been a verified 
case of hydraulic fracturing causing or contributing to contamination 
of water resources. The Division has always had very stringent rules 
concerning well bore construction and the protection of water 
resources. However, to make the the process of hydraulic fracturing 
more transparent and alleviate the recent public fear of hydraulic 
fracturing, the Division adopted a formal hydraulic fracturing rule in 
October 2012. This rule combined many of the Division exiting rules 
concerning overall best management practices for oil and gas production 
as related to safe and efficient operations, as well as a public 
disclosure of chemicals used in the hydraulic fracturing process.
    There are three major concerns that have come to the forefront 
concerning hydraulic fracturing. The BLM has presented these in their 
proposed rule and Utah has also addressed them historically and with 
their current hydraulic fracturing rule.
        (1)  Provide public disclosure of chemicals used in hydraulic 
        fracturing
        (2)  Include regulations to insure well-bore integrity
        (3)  Address issues related to flowback water
PUBLIC DISCLOSURE
    The Utah rule requires operators to report to fracfocus.org within 
60 days of completion of the hydraulic fracturing operation of the 
chemicals used in the process. The primary purpose of fracfocus.org is 
to provide factual information concerning hydraulic fracturing and 
groundwater protection. FracFocus is the national hydraulic fracturing 
chemical registry accepted by both industry and government. It is 
managed by the Ground Water Protection Council (GWPC) and the 
Interstate Oil and Gas Compact Commission (IOGCC), two organizations 
whose missions both revolve around conservation and environmental 
protection. The site was created to provide the public access to 
reported chemicals used for hydraulic fracturing at specific well 
locations. To help users put this information into perspective, the 
site also provides objective information on hydraulic fracturing, the 
chemicals used, and the purposes they serve and the means by which 
groundwater is protected.
    This reporting process that The Division uses and is also proposed 
by the BLM rule.
WELL BORE INTEGRITY
    Existing rules were already in place to insure well bore integrity 
and construction. This included detailed rules on:
          Casing and cementing programs
          Blowout prevention and uncontrolled flow
          Protection of freshwater aquifers
          Casing pressure tests
    The Utah hydraulic fracturing rule emphasizes the the use of 
already existing rules that have manage oil and gas production in Utah 
for many years. The regulatory processes of The Division (that include 
permitting, inspection, compliance, and enforcement) are effective in 
ensuring the responsible development of Utah's resources with due 
regard for and protection of the environment. This begins with well 
bore integrity. The professional staff of DOGM has the local knowledge 
and expertise to address the technical and scientific challenges posed 
by Utah's unique geology and geography. A nationwide process of 
hydraulic fracturing rulemaking would be no more effective in achieving 
better oversight of hydraulic fracturing operations than exits at the 
state level in Utah and other states with similar rules. In addition, 
substantial cost of manpower and time for both government and the 
private sector organizations would be incurred.
    On-site inspection of oil and gas wells are a key component of The 
Division's regulatory program. All wells drilled on state or private 
lands in Utah are subject to a rigorous inspection program that 
includes: inspection and witnessing of well control equipment tests, 
casing/cementing operations, follow up to third party complaints, 
general compliance verification, drilling operations, emergency 
response, final land restoration/bond release, well plugging, 
production/environmental, and workover/recompletion. In 2012, 8,983 
such on-site inspections were performed by DOGM field operations staff.
    Through a detail and very comprehensive geologic study, the depth 
to the usable ground water has been mapped in the primary oil and gas 
producing area of Utah, the Uintah Basin. Recognizing the usable water 
and its protection is the primary concern when developing a casing 
program for a potential well.
MANAGEMENT OF FLOWBACK WATER AND SURFACE PROTECTION
    The Division's rules state that the operators shall take all 
reasonable precautions to avoid polluting lands, streams, lakes, 
reservoirs, natural drainages and underground water. Prior to any 
drilling operations all drill sites have on-site inspections and are 
analyzed for surface conditions and best practices are employed to 
prevent any contamination of surface water or ground water. The 
Division's Board has recently approved (July 1, 2013) a revised set of 
rules entitled ``Waste Management and Disposal'' These rules update 
methods and restraints for disposal of RCRA (Resource Conservation 
Recovery Act) exempt waste from oil and gas production. This would 
include the the management of hydraulic fracturing fluid flow back.
    Utah production water is dispose of by two methods:
          UIC Class II injection wells (94%)
          Evaporative disposal ponds (6%)
    DOGM has primacy from EPA region 8 to permit Class II injection 
well on all non-Indian Country. The Division just recently went under 
an extensive review of the process from EPA and was found to be in 
compliance with their rules and regulations.
    The Board at DOGM has recently approved new rules that revised the 
regulations concerning surface disposal facilities that accept 
hydraulic fracturing flowback. This includes:
          Chemical testing as needed
          Surface and sub-surface geology
          Size and depth limited to 10 acre-feet
          Protection of drinking water, flood plains and ground 
        water
          Duel liners with leak detection system
          Bermed area to contain any catastrophic failure
          Safety and emergency plans
          Increased and escalated bonding.
    The management of hydraulic fracturing flow back is monitored 
through both surface disposal and UIC Class II wells as directed by the 
EPA. No other regulation is necessary.
FEDERAL/STATE INTERACTION
    The Division has worked very well with federal agencies when 
concerned with spacing, flaring and split estate issues. However, there 
is no collaboration concerning hydraulic fracturing. The Division 
believes that a state wide standard as defined by The Division's 
hydraulic fracturing would be beneficial, rather than several 
regulations as proposed.
STATE AND INDUSTRY
    State and industry have worked very well together to establish a 
win-win situation concerning hydraulic fracturing flowback that is 
injected into the ground for water floods. Facilities, both permanent 
and temporary have been used to clean flowback water and use it in the 
water flood of an oil field. This recycled water greatly reduces the 
amount of fresh water that is used in hydraulic fracturing. In 
addition, water flow lines have been constructed in order to greatly 
reduce truck traffic and improve air quality.
CONCLUSION
    I believe that Utah DOGM does an excellent job in monitoring 
hydraulic fracturing in Utah. Also, it is my experience that other 
States also perform at a similar exceptional level.
                                 ______
                                 
    Mr. Lamborn. OK, thank you.
    Ms. Epstein?

 STATEMENT OF LOIS N. EPSTEIN, P.E., ARCTIC PROGRAM DIRECTOR, 
                     THE WILDERNESS SOCIETY

    Ms. Epstein. Good morning, Chairman Lamborn and other 
Subcommittee members, and thank you for inviting me to testify. 
My name is Lois Epstein, and I am an Alaska-licensed engineer 
representing The Wilderness Society. The Wilderness Society is 
a national public interest conservation organization with over 
500,000 members and supporters.
    My background in oil and gas issues include serving on the 
Department of the Interior's Ocean Energy Safety Advisory 
Committee, established after the BP Gulf spill in 2010; 
testifying before Congress on numerous previous occasions; 
analyzing the environmental performance of Alaska's Cook Inlet 
and North Slope onshore and offshore oil and gas 
infrastructure. I have worked for three private consultants and 
for national and regional conservation organizations in both 
Washington, D.C. and Anchorage, Alaska.
    Today's hearing addresses H.R. 2728. This bill prohibits 
the Federal Government from regulating hydraulic fracturing 
operations, including associated operations such as chemical 
and wastewater storage and disposal on Federal lands, even if 
States have issued only hydraulic fracturing ``guidance,'' or 
have developed ineffective regulatory programs.
    The bill is indifferent to how well such programs protect 
surface and groundwater, wildlife habitat, and the public. And 
it is a fact that surface activities associated with hydraulic 
fracturing operations have caused water contamination. So 
statements focusing only on the fracking process itself being 
benign are misleading. And that is an important distinction.
    For example, a State agency could issue a vague guidance on 
wellbore cementing for fracturing operations and any Bureau of 
Land Management regulation, no matter how specific on wellbore 
cementing, would be rendered void under the language of the 
bill.
    Section 2(a) is sufficiently vague, in fact, that BLM might 
be unable to enforce any Federal regulation with any 
relationship to oil, gas, or geothermal energy, simply because 
States have guidances or regulations regarding hydraulic 
fracturing. States potentially could argue that their oil and 
gas guidance or regulations supersede any Federal oversight 
program, thereby allowing fracturing, as we heard by the 
Ranking Member, in national parks, national wildlife refuges, 
wilderness areas, where such activities currently are 
prohibited.
    Currently, BLM and tribal lands are subject to a patchwork 
of State hydraulic fracturing regulations. Some States require 
best practices, and we have heard from the States represented 
here that many of those practices are in place in these States, 
while other States, however, do not require such practices. And 
that is an important point. According to the FracFocus 
information Web site, ``While nearly all States''--this is a 
quote--``require the circulation of cement on surface casing, 
it is not a universal requirement.''
    Additionally, in some States it is common for State 
personnel to witness the running of cementing of casing 
strings, while in other States the submission of a completion 
report which details the amounts and types of casing and cement 
used in the completion of the well is considered sufficient 
evidence of proper well construction.
    As an engineer, it does not make technical sense to have 
non-protective or inadequately enforced requirements in place 
in particular States. In fact, all States care about their 
usable groundwater and surface water resources. So a national 
baseline of technical measures ensuring wellbore integrity, 
including proper cementing and casing, suitable management of 
flowback water, and robust chemical disclosure makes sense, 
such as that developed by BLM.
    From a policy perspective, Federal lands which are owned by 
all Americans should be protected at roughly equivalent levels 
throughout the country, and not subject to the oversight whims 
of particular States and their powerful industries.
    Moreover, the Federal Government has a congressionally 
mandated stewardship requirement for these lands, and trust 
responsibilities for Indian lands, unlike States. Baseline 
Federal standards, which are applicable across the country, 
have been a common feature of our Nation's approach to ensuring 
that all Americans enjoy protection from harm from industrial 
activities. The Clean Air and Clean Water Acts, for instance, 
provide minimum Federal standards, while allowing States to 
impose more stringent or specific requirements. The benefit to 
this approach, which has remained in place on a bipartisan 
basis for decades is that it brings needy consistency for 
companies operating in multiple States.
    For States, this approach saves governmental resources, 
particularly in States without the ability to do their own 
analyses to establish the regulations. And there are several 
States that are currently entering oil and gas drilling, and 
they don't have a lot of expertise at this time.
    The regulations proposed by BLM earlier this year for 
hydraulic fracturing will not undercut State programs. There 
are strong technical and policy reasons for Federal baseline 
requirements, especially regarding wellbore integrity and water 
resource protections. States should not be allowed to undermine 
Federal requirements because the end result will be 
contamination problems.
    Thank you very much for your attention to these concerns. I 
look forward to answering your questions.
    [The prepared statement of Ms. Epstein follows:]

    Statement of Lois N. Epstein, P.E., Engineer and Arctic Program 
                               Director, 
               The Wilderness Society, Anchorage, Alaska

    Good morning and thank you for inviting me to testify today. My 
name is Lois Epstein and I am an Alaska-licensed engineer and the 
Arctic Program Director for The Wilderness Society. The Wilderness 
Society, or TWS, is a national public interest conservation 
organization with more than 500,000 members and supporters. TWS's 
mission is to protect wilderness and inspire Americans to care for our 
wild places.
    My background in oil and gas issues includes membership from 1995-
2007 on the U.S. Department of Transportation's Technical Hazardous 
Liquid Pipeline Safety Standards Committee which oversees oil pipeline 
regulatory and other agency activities, serving on the Department of 
the Interior's Ocean Energy Safety Advisory Committee established after 
BP's Gulf spill in 2010, testifying before Congress on numerous 
occasions, and analyzing the environmental performance of Alaska's Cook 
Inlet and North Slope onshore and offshore oil and gas infrastructure. 
I have worked on oil and gas environmental and safety issues for more 
than 25 years for three private consultants and for national and 
regional conservation organizations in both Washington, DC and 
Anchorage, AK, and currently am actively engaged in development of 
hydraulic fracturing requirements in Alaska. I have a bachelor's degree 
in mechanical engineering from MIT and a master's degree in civil 
engineering from Stanford University.
The Language of the Bill
    Today's hearing addresses H.R. 2728, the stated purpose of which is 
``To recognize States' authority to regulate oil and gas operations and 
promote American energy security, development, and job creation.'' 
Because there is no controversy regarding states' authority to regulate 
oil and gas operations, we must look to the bill's language to see what 
it actually does. The key provisions in the bill are contained in Sec. 
2(a), which states that ``The Department of the Interior shall not 
enforce any Federal regulation, guidance, or permit requirement 
regarding . . . the hydraulic fracturing process, or any component of 
that process . . .'' and Sec. 2(b) which states that ``The Department 
of the Interior shall recognize and defer to State regulations, 
permitting, and guidance, for all activities . . . on Federal land 
regardless of whether those rules are duplicative, more or less 
restrictive, shall have different requirements, or do not meet Federal 
guidelines.'' In other words, the bill prohibits the federal government 
from regulating hydraulic fracturing operations--including associated 
operations such as chemical and wastewater storage and disposal--on 
federal lands even if states have issued only hydraulic fracturing 
``guidance'' or have developed ineffective regulatory programs. The 
bill is indifferent to how well state regulatory programs protect 
surface and groundwater, wildlife habitat, and the public.
    For example, a state agency could issue a vague guidance on 
wellbore cementing for fracturing operations such that any Bureau of 
Land Management (BLM) regulation on wellbore cementing, no matter how 
specific, might be rendered void. The language in Section 2(a) is 
sufficiently vague that BLM might be precluded from enforcing any 
federal regulation with any relationship to oil, gas, or geothermal 
energy, simply because states have guidelines or regulations regarding 
hydraulic fracturing. This includes federal regulations issued pursuant 
to the Mineral Leasing Act, the Federal Lands Policy Management Act 
(FLPMA),\1\ as well as other acts.
---------------------------------------------------------------------------
    \1\ FLPMA requires BLM to issues rules and regulations to prevent 
unnecessary or undue degradation of public lands, and to protect 
ecological, environmental, and water resources for future generations. 
See 43 U.S.C. Sec. Sec. 1702(c), 1733, 1740.
---------------------------------------------------------------------------
    The bill's effort to nullify federal law where it conflicts with 
state law turns on its head the principle behind the Constitution's 
Supremacy Clause, whereby state law is preempted to the extent it 
conflicts with federal law.\2\
---------------------------------------------------------------------------
    \2\ See, e.g., Florida Lime & Avocado Growers, Inc. v. Paul, 373 
U.S. 132, 142-143 (1963), Guarino v. Wyeth, LLC, No. 12-13263, 2013 WL 
3185084 (June 25, 2013).
---------------------------------------------------------------------------
Federal and State Roles Regarding Hydraulic Fracturing
    Currently, BLM and tribal lands are subject to a patchwork of state 
hydraulic fracturing regulations, with some states not having performed 
much work on this issue. Some states require best practices in some 
areas, while other states do not. According to the FracFocus 
website:\3\
---------------------------------------------------------------------------
    \3\ See http://fracfocus.org/hydraulic-fracturing-how-it-works/
casing.
---------------------------------------------------------------------------
        While nearly all states require the circulation of cement on 
        surface casing, it is not a universal requirement. In some 
        states, cement is required only across the deepest ground water 
        zone . . .

        [Additionally,] [i]n some states it is common for state 
        personnel to witness the running and cementing of casing 
        strings, while in other states the submission of a completion 
        report which details the amounts and types of casing and cement 
        used in the completion of the well is considered sufficient 
        evidence of proper well construction. In a few states such as 
        Alaska, Michigan and Ohio, an additional verification method 
        using geophysical logs such as Cement Bond Logs (CBL) and 
        Variable Density Logs (VDL) may be required. By measuring the 
        travel time of sound waves through the casing and cement to the 
        formation, the CBL shows the quality of bonding between the 
        casing and the cement. The VDL performs a similar function to 
        measure the bond between the cement and the borehole. By 
        measuring the quality of the cement to casing and cement to 
        formation bond, the sealing quality of the cement in the space 
        between the casing and the borehole (called the annulus) can be 
        evaluated.
    Clearly, not all states have similarly-protective requirements, nor 
do they have equivalent resources or enforcement efforts related to oil 
and gas development. In Pennsylvania, for instance, where flowback 
water has been legally taken to wastewater treatment plants, several 
rivers were contaminated with chemicals that could create carcinogens 
in drinking water. According to the Scranton Times-Tribune:\4\
---------------------------------------------------------------------------
    \4\ See http://thetimes-tribune.com/news/gas-drilling/state-calls-
for-halt-to-shale-wastewater-treatment-at-15-plants-1.1135095 (April 
20, 2011).
---------------------------------------------------------------------------
        Citing concerns about high levels of bromides in western 
        Pennsylvania rivers, acting Department of Environmental 
        Protection Secretary Michael Krancer gave the drillers until 
        May 19 to stop taking the waste to treatment facilities that 
        were grandfathered into state rules that curb how much salt can 
        be discharged into streams.

        The request--which does not have the legal weight of an order--
        comes after federal environmental regulators, scientists and 
        drinking water suppliers raised concerns about the drilling 
        wastewater, which is laden with salts, metals and naturally 
        occurring radioactive material that cannot be completely 
        removed by conventional treatment plants.

        The request came on the same day that the Marcellus Shale 
        Coalition, an industry group, acknowledged that drilling 
        wastewater is contributing to elevated bromide levels in the 
        Allegheny and Beaver rivers.

        Reducing the amount of salts, or total dissolved solids, in the 
        wastewater also reduces bromides, which are nontoxic but can 
        turn into cancer-causing compounds called brominated 
        trihalomethanes when combined with chlorine at drinking water 
        treatment facilities.

        ``Now is the time to take action to end this practice,'' Mr. 
        Krancer said, citing ``more definitive scientific data, 
        improved technology and increased voluntary wastewater 
        recycling by industry'' since the facilities were given special 
        exemptions to the state total dissolved solids standards when 
        they were implemented last year.
    As an engineer, it does not make technical sense to have non-
protective requirements in place in certain states. In fact, all states 
care about their usable groundwater and surface water resources, so a 
national baseline of technical measures ensuring wellbore integrity 
including proper cementing and casing,\5\ suitable management of 
flowback water, and robust chemical disclosure makes sense from an 
engineering perspective.
---------------------------------------------------------------------------
    \5\ Notably, the Western Energy Alliance (WEA) report on the 
Economic Impact of Revised BLM Completion Rule issued on May 24. 2013, 
(see the report at http://westernenergyalliance.org/wp-content/uploads/
2013/07/Final-Economic-Analysis-of-the-BLM-Fracing-Rule-Revision.pdf, 
July 19, 2013) shows that 90% of the compliance cost of BLM's proposed 
rule on hydraulic fracturing is from enhanced casing, an essential 
component of well integrity. The WEA acknowledges that operators have 
an obligation to protect actual drinking water sources (footnote 14 in 
the study, which does not mention an obligation to protect potential 
drinking water sources). If that is the case, there will be some cost 
to doing so effectively and that cost will be debatable as it is 
difficult to predict on a nationwide basis.
---------------------------------------------------------------------------
    From a policy perspective, federal lands--which are owned by all 
Americans--should be protected at roughly equivalent levels throughout 
the country, and not subject to the regulatory or enforcement whims of 
particular states. Moreover, the federal government has 
Congressionally-mandated stewardship requirements under FLPMA and trust 
responsibilities for Indian lands,\6\ unlike states. BLM must ensure 
that:
---------------------------------------------------------------------------
    \6\ E.g., Indian Mineral Leasing Act, 25 U.S.C. Sec. 2103(b); 
Indian Energy Act, 25 U.S.C. Sec. 3504(e)(6).
---------------------------------------------------------------------------
        ``. . . public lands be managed in a manner that will protect 
        the quality of scientific, scenic, historical, ecological, 
        environmental, air and atmospheric, water resource, and 
        archeological values; that, where appropriate, will preserve 
        and protect certain public lands in their natural condition; 
        that will provide food and habitat for fish and wildlife and 
        domestic animals; and that will provide for outdoor recreation 
        and human occupancy and use.\7\
---------------------------------------------------------------------------
    \7\ 43 U.S.C. 1701(a)(8).
---------------------------------------------------------------------------
    FLPMA also directs BLM to manage the public lands so as to prevent 
unnecessary or undue degradation, and to protect the ecological, 
environmental, and water resources for future generations.\8\
---------------------------------------------------------------------------
    \8\ 43 U.S.C. Sec. Sec. 1702(c), 1740.
---------------------------------------------------------------------------
    It is essential that the federal government ensure adequate 
regulations are in place for industrial activities occurring on the 
lands it manages while providing states with the ability to exceed 
those requirements or to address atypical conditions. This regulatory 
model--where baseline federal standards are applicable across the 
country--has been a common feature of our nation's approach to ensuring 
that all Americans enjoy protection from harm from industrial 
activities. The Clean Air and Clean Water Acts, for instance, are 
structured to provide minimum federal standards, while allowing states 
to impose more stringent or specific requirements. A benefit to this 
approach, which has remained in place on a bi-partisan basis for 
decades, is that it brings needed consistency for companies operating 
in multiple states. For states, this approach saves governmental 
resources because each state can rely on the federal government with 
its greater capacity to develop an adequate set of minimum regulatory 
requirements.
Deferring to State or Tribal Requirements
    BLM currently is developing regulations to set a baseline for 
hydraulic fracturing operations on the lands it manages. Earlier this 
year, BLM issued a revised draft version of these regulations for 
public comments.\9\ The proposed regulations would allow BLM to issue a 
variance for all wells within states or within Indian lands, or to 
specific fields or basins within states or Indian lands (proposed 
section 3162.3-3(k)). BLM specifically requested comments on whether 
compliance with proposed chemical disclosure requirements (section 
3162.3-3(i)(1)) should be satisfied by compliance with state or tribal 
requirements for the same or more information about the chemical 
constituents of hydraulic fracturing fluids.
---------------------------------------------------------------------------
    \9\ 78 Federal Register 31636-31676 (May 24, 2013), http://
www.gpo.gov/fdsys/pkg/FR-2013-05-24/pdf/2013-12154.pdf.
---------------------------------------------------------------------------
    TWS supports allowing federal compliance to be achieved where state 
or tribal disclosure requirements meet or exceed the federal standard 
and where states or tribes have adequate systems for conveying 
information about hydraulic fracturing activities to the public (though 
such an approach is unwieldy and a single database is preferable).
Conclusion
    In its proposal to address several important issues that have 
arisen around hydraulic fracturing on federal public lands, BLM is 
attempting to fulfill its legal responsibilities to ensure a baseline 
level of regulatory protection and consistency for the American public. 
The regulations proposed by BLM earlier this year for hydraulic 
fracturing will not undercut state regulatory initiatives in this area. 
BLM's proposed hydraulic fracturing requirements operate like Clean Air 
and Clean Water Act requirements, allowing states to exceed federal 
requirements to meet state-specific technical needs or public desires 
for increased protection. On federal lands, there are strong technical 
and policy reasons for federal baseline requirements--especially 
regarding wellbore integrity and water resource protections--to ensure 
equitable standards throughout the country. States should not be 
allowed to undermine federal requirements because the end result will 
be contamination problems that will adversely affect regions and the 
industry as a whole.
    Thank you very much for your attention to these concerns. I look 
forward to answering your questions.
                                 ______
                                 

  Response to Questions Submitted for the Record by Lois N. Epstein, 
        P.E., Arctic Program Director for The Wilderness Society

Questions from Rep. Holt
1.)  Ms. Epstein, can you summarize how hydraulic fracturing 
        operations--not just the fracking process itself--can 
        contaminate water resources?
    Hydraulic fracturing, a well treatment process used to enhance oil 
and gas production, has been used in a number of places in the U.S. 
with underground shale formations. Use of hydraulic fracturing 
increased tremendously in recent years following refinement of these 
well stimulation techniques and federal deregulation of hydraulic 
fracturing in the Energy Policy Act of 2005. Shale formations generally 
are located in different areas than ``conventional'' oil and gas 
reservoirs.
    The process of fracturing is not the only activity associated with 
these wells, however. In order to fracture, operators also must store 
chemicals, and manage wastewater (i.e., storage, reinjection, 
discharge, and/or transport operations) and oil and gas drilling 
wastes. These activities--if not done well--can contaminate water 
resources near drilling sites.
    Fracturing, itself, hypothetically can contaminate groundwater 
resources though the data on that has not been robust so far and 
research is continuing. This situation can occur with inadequate well 
integrity close to groundwater resources, if fractures extend beyond 
projected locations due to inadequate modeling and/or poor 
implementation of well stimulation, if fractures intersect faults or 
fractures from other wells, or if inadequate well closure/abandonment 
occurs.
    Additionally, wastewater discharges to surface water of bromide 
generated at hydraulic fracturing sites at legal, permitted levels have 
combined with chlorine at downstream drinking water treatment plants to 
form trihalomethanes, which are carcinogens.
2.)  Ms. Epstein, we talk a lot about ``certainty'' in this committee. 
        The Majority has consistently argued that extractive industries 
        need more certainty from this administration. Yet, the Majority 
        also insists--as evidenced by this bill--that we need a state 
        by state approach to regulating hydraulic fracturing. How does 
        that provide certainty to industry?
    Developing and enforcing clear federal rules that apply when 
operating on Bureau of Land Management (BLM) lands would provide 
certainty and consistency to industry on federal expectations for 
hydraulic fracturing and the associated operations described in the 
answer to Question 1. Because H.R. 2728 allows a variety of still-
developing state rules and guidance--no matter how inadequate--to 
preempt federal rules covering fracturing, operators would not have 
certainty and consistency for their fracturing operations when 
operating on BLM lands in multiple states.
3.)  Ms. Epstein, as you testify, this bill purports to reverse 
        traditional notions of authority over federal land by giving 
        states complete control over hydraulic fracturing, drilling and 
        gas operations. Are there any safeguards against abuse of power 
        by the states? Do the states have comparable authority in other 
        laws which allow them to fully dictate the use of federal 
        lands?
    There are no safeguards in the bill to prevent abuse of power by 
the states. H.R. 2728 Section 44(b) is vague regarding which state laws 
would require federal deference. Presumably the bill does not intend to 
override EPA's authority under the Clean Water Act. But what if a 
state's laws or guidance conflict with the Bureau of Land Management's 
mandate under the Federal Land Policy Management Act (FLPMA) to manage 
public lands under the principles of multiple and sustained use? \1\ 
Would state ``guidance''--a term included in Sec. 44(b)--trump FLPMA? 
This is a concern, as states are not legally required to meet the 
stewardship standards in place for federal lands.\2\ Nor do states 
share in the federal government's trust responsibilities for Indian 
lands.\3\
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    \1\ 43 U.S.C. Sec. 1732.
    \2\ FLPMA directs BLM to manage the public lands so as to prevent 
unnecessary or undue degradation, and protect the ecological, 
environmental, and water resources for future generations. 43 U.S.C. 
Sec. Sec. 1702(c), 1740.
    \3\ E.g., Indian Mineral Leasing Act, 25 U.S.C. Sec. 2103(b); 
Indian Energy Act, 25 U.S.C. Sec. 3504(e)(6).
---------------------------------------------------------------------------
    The Wilderness Society's (TWS's) review of U.S. laws has not 
revealed a comparable federal law allowing states to fully dictate the 
use of federal lands. The Clean Water Act (CWA) \4\ and the Clean Air 
Act (CAA) \5\ are carefully designed to allow states to serve as 
partners in implementing federal baseline standards, while enabling 
states to implement more stringent state-specific standards if 
desired.\6\ States may tailor federal standards (e.g., water quality 
criteria under the CWA), establish compliance strategies (e.g., state 
implementation plans under the CAA), implement permit programs (e.g., 
state pollutant discharge elimination systems under the CWA), and 
enforce rules (e.g., state administrative and judicial procedures). A 
similar cooperative approach could be applied to hydraulic fracturing 
through BLM's proposed rulemaking.\7\
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    \4\ 42 U.S.C. 7401, et seq.
    \5\ 33 U.S.C. 1251, et seq.
    \6\ See 33 U.S.C. Sec. 1370; 42 U.S.C. Sec. 7416.
    \7\ BLM, Oil and Gas; Hydraulic Fracturing on Federal and Indian 
Lands, 78 Fed. Reg. 31636 (May 24, 2013).
---------------------------------------------------------------------------
4.)  Ms. Epstein, the Majority has forgotten that we are talking about 
        the federal mineral estate. Should we grant state police 
        departments the authority to control military operations on 
        federal bases within state lines? Is there any precedent for 
        granting states full authority over drilling and gas operations 
        on all public lands?
    As a nation, we have collectively decided that issues of national 
importance with trans-state implications should not be regulated solely 
by states. This is the principle behind the Commerce Clause of the U.S. 
Constitution, which allows Congress to regulate interstate commerce and 
navigable waters. Additionally, we also have given federal agencies the 
authority to oversee the lands and resources belonging to the citizens 
of our nation for the benefit of all Americans through various laws 
governing the management of federal public lands, forests, and waters.
    While many aspects of oil and gas operations are regulated by 
states,\8\ the federal government retains influence through overarching 
laws such as the CWA, the CAA, the Oil Pollution Act,\9\ the Natural 
Gas Act,\10\ and the Energy Policy Act.\11\ With respect to federal 
lands, the federal government is explicitly required by statute to 
manage the oil and gas resources owned by all Americans under the 
auspices of the Mineral Leasing Act, FLPMA, as well as other relevant 
statutes. Federal land managers such as the BLM are subject to federal 
laws governing how they manage public lands. These laws have provided 
the basis for regulations, guidance and orders on oil and gas leasing, 
exploration, and production. BLM has acted on its responsibility to 
manage lands by developing a proposed rule that provides minimal 
standards for hydraulic fracturing on BLM lands. The proposed rule 
gives states the option to substitute their own regulations if the 
regulations provide equivalent or greater protection.\12\
---------------------------------------------------------------------------
    \8\ For example, in Alaska, the Alaska Oil and Gas Conservation 
Commission regulates the drilling for and production of oil and gas 
resources, the principles of oil and gas conservation, and the 
underground injection for both waste management and enhanced recovery. 
See Alaska Stat. Sec. 31.05.030, Sec. 31.05.110. The Alaska Department 
of Natural Resources is responsible for leasing state lands and 
prescribing unit plans. See Alaska Stat. Sec. 31.05.110, 
Sec. 31.05.180. The Alaska Department of Environmental Conservation 
oversees pollution-related industrial activities including storage and 
spill prevention for oil and hazardous substances, air and water 
discharges, and solid waste management. See Alaska Stat. Title 46.
    \9\ 33 U.S.C. Sec. 40, et seq.
    \10\ 15 U.S.C. Sec. 717, et seq.
    \11\ 42 U.S.C. Sec. 13201 et seq.
    \12\ Proposed 43 C.F.R. Sec. 3162.3-3(k).
---------------------------------------------------------------------------
5.)  Ms. Epstein, an oft-repeated concern of the Majority is that 
        proposed regulation by the federal government doesn't take into 
        account that geology and hydrology may differ between states. 
        In testimony before this Committee last week, Secretary Jewell 
        clearly responded to this concern by stating that the three 
        main topics addressed in the BLM regulations--1) chemical 
        disclosure, 2) well construction standards, and 3) managing 
        flowback--are necessary in any fracking operation and are not 
        dependent on ground characteristics. Would you agree that these 
        three focus areas are applicable to all fracturing operations?
    Yes, these three focus areas are applicable to all fracturing 
operations. In the comments TWS submitted to BLM on September 15, 2013, 
attached, TWS supports BLM's efforts to develop this rule, though we 
also stated our disappointment that BLM did not include other 
requirements essential to ensure adequate fracturing (and other forms 
of well stimulation such as ``acidizing'') oversight regardless of 
geology and hydrologic differences. These needed requirements include 
pre- and post-fracturing water monitoring, pre-fracturing notice of 
chemical constituents, measures to reduce flaring, the use of enclosed 
tanks for storing fracturing fluids, proper well abandonment and 
remediation, and a prohibition on the use of diesel-based and other 
toxic chemical-based fracturing fluids as water-based alternatives are 
available.
    As an engineer who has worked on oil- and gas-related technical 
issues for over 25 years, I understand the consequences of inadequate 
well integrity/well construction, i.e., contamination of water and soil 
that must be cleaned up. I don't believe anyone on the Committee is in 
favor of poor well integrity for wells on BLM lands, which is what 
could result if we rely on existing or future inadequate state 
regulations or guidance. Many states currently are in a learning phase 
regarding hydraulic fracturing as they have not had major oil and gas 
operations there for many years (or perhaps ever), and do not have the 
technical staff needed to ensure adequate standards.
    Regardless of geology and hydrology, chemical disclosure allows the 
public and emergency responders from any state who spend time near 
fracturing operations to know what chemicals are in use. As for 
managing flowback wastewater, this is an essential, technical measure 
that ensures states will not adversely contaminate surface or 
groundwater through poor wastewater recycling, treatment and/or 
disposal practices.
6.)  Ms. Epstein, as you point out in your testimony, the Clean Air Act 
        and the Clean Water Act both provide minimal federal standards 
        while allowing states to impose more stringent or specific 
        requirements. Isn't it true that the same principle applies 
        with BLM's proposed hydraulic fracturing rule?
    Yes. As stated in TWS's comments submitted to BLM on September 15, 
2013:
        The Clean Air and Clean Water Acts both are structured to 
        provide minimum federal standards. This approach brings needed 
        consistency for companies operating in multiple states. For 
        state governments, this approach saves resources, as each state 
        can rely on the federal government with its greater capacity to 
        provide an adequate regulatory baseline.

        Based on experience to date regarding hydraulic fracturing, if 
        the states alone regulate these operations, there will be gaps 
        in those standards (i.e., no state has ``model'' regulations), 
        and inadequate stringency or delays in implementation in states 
        with powerful hydraulic fracturing interests. (pp. 3-4)
    The federal government can help ensure adequate technical and 
public disclosure requirements until such a time that states meet or 
exceed those standards.
7.)  Ms. Epstein, the discrepancies in state standards are why a 
        federal standard is needed. But
    BLM's proposed rule is significantly weaker than the draft issued 
last year. For example:
        1.  In the proposed rule, cement evaluations now don't have to 
        be submitted until after the well is stimulated. Do you think 
        cement evaluations should be submitted prior to the stimulation 
        of a well?
        2.  In the proposed rule, operators don't have to provide BLM 
        with information (depth, volume of fluids, chemicals, water 
        source, size of fracturing) about each well and instead can 
        just use one packet of generic information to be submitted for 
        all ``similar wells.'' Do you think oil and gas companies 
        should be required to submit information on individual wells?
        3.  In the leaked (sic) rule, disclosure of fracking chemicals 
        would not have to be disclosed (sic) until after a well is 
        drilled using FracFocus. Do you think disclosure should be 
        required before fracking, as is required in Wyoming?
Cement evaluations
    TWS believes that cement evaluations should be submitted prior to 
well stimulation. Doing so would enable BLM to ensure that stimulation 
would not proceed until mechanical integrity tests prove successful.
``Type well'' testing vs. individual well testing
    TWS's comments provide extensive discussion on use of ``type 
wells'' vs. providing BLM with testing (cement evaluation logs or CELs 
and mechanical integrity tests or MITs) results on individual wells. 
According to proposed 43 C.F.R. section 3162.3-3(h)(i), however, ``The 
information required in paragraphs (i)(1) through (i)(8) of this 
section must be submitted . . . for each well, even if the BLM approved 
fracturing of a group of wells.'' Sections (i)(1) through (i)(8) cover 
true vertical depth, volume of fluids, and other items listed in 
Question 7.
    Regarding ``type wells'' vs. individual well testing information, 
TWS's comments to BLM state:
        The proposed regulations in sections 3162.3-3(d) and 3162.3-
        3(e) would require CELs only on ``type wells,'' wells that are 
        not preceded by approved type wells or are not part of an 
        approved field development proposal, and whenever there is 
        evidence of a problem with cement jobs. The definition provided 
        for ``type well'' in section 3160.0-5 is ``an oil and gas well 
        that can be used as a model for well completion in a field 
        where geologic characteristics are substantially similar within 
        the same field, and where operations such as drilling, 
        cementing, and completions using hydraulic fracturing are 
        likely to be successfully replicated using the same design.''

        But the proposed rule does not require the operator to certify 
        that it will use similar cement composition, fracturing fluids 
        or drilling practices in subsequent wells. Nor does it require 
        the operator to submit proof that subsequent wells have 
        substantially similar geological characteristics. The use of 
        type wells assumes that geologic zones are compositionally, 
        texturally, and mechanically homogeneous media, even though 
        this is often not true. Faults can remove or add sections of 
        rock over short distances. Folding can result in reoriented or 
        repeated sections of rock. Tilting can result in formations at 
        differing depths with missing sections. Missing sections can 
        also result from the presence of unconformities. Even if the 
        geology is perfectly consistent, operator inconsistencies 
        during drilling could result in unexpected differences in 
        borehole geometry that could affect the cement as it is 
        squeezed into the annulus.

        BLM acknowledges some uncertainty about the benefits of the 
        type well concept in the preamble to the proposed rule: ``there 
        is uncertainty about the effectiveness of the type well 
        concept, and how reliably the CEL results on casing strings of 
        a type well assure adequate cementing for subsequent wells in 
        the same geologic area.''\13\ We recommend that BLM require 
        cement evaluation logs on all wells where casing serves as a 
        barrier between fracturing operations and usable water (similar 
        to what was proposed in 2012); or to ensure the similarity of 
        wells, cementing, fracturing fluids and processes, and 
        homogeneous, non-complex geologic characteristics prior to 
        utilizing ``type well'' approval procedures.\14\ (p. 13)
---------------------------------------------------------------------------
    \13\ Proposed Rules, 75 Fed. Reg. 31664 (May 24, 2013).
    \14\ See DNV Recommended Practice, p. 33 (``Cement logging 
represents a core quality control procedure in the construction of 
shale gas wells. Casing cement that forms part of the well barrier 
envelope in the fracturing or production operation shall be verified by 
cement bond logs. . . . It is important to track local changes of the 
production casing/liner and the interface between the casing wall, 
cement and formation.'')
---------------------------------------------------------------------------
        We further suggest that BLM clarify that MITs are required for 
        each and every well--not just for a type well. The Federal 
        Register description of the proposed rule at page 31652 states 
        that it is ``necessary to perform a MIT prior to each 
        refracturing operation,''\15\ but the rule itself at section 
        3162.3-3(f) does not specifically state that a MIT must be 
        performed on each well. MITs are as important for older wells 
        being refractured as for new wells. According to oil and gas 
        technology supplier Schlumberger, by the time an oil or gas 
        well is 15 years old there is a 50 percent probability that it 
        will have measurable sustained casing pressure--an indicator of 
        compromised zonal isolation in a well.\16\ (p. 14)
---------------------------------------------------------------------------
    \15\ See also 78 Fed. Reg. 31654 (explaining that BLM received some 
comments stating that an MIT is not needed on every well, but that BLM 
decided not to change this requirement).
    \16\ Claudio Bruffato et al, From Mud to Cement: Building Gas 
Wells, Oilfield Resources (Autumn 2003), 63, available at http://
www.slb.com//media/Files/resources/oilfield_review/ors03/aut03/
p62_76.ashx
---------------------------------------------------------------------------
Pre-fracturing disclosure
    As discussed in TWS's comments to BLM:
        Pre-fracturing public disclosure is important to allow land 
        owners, public land managers, and users of nearby water sources 
        to conduct independent baseline water quality testing to 
        determine if water resources are uncontaminated or if they 
        contain any of the chemicals planned to be injected during 
        hydraulic fracturing. If specific chemical data are not 
        provided until after hydraulic fracturing occurs, a concerned 
        person would not know which chemicals may have been used and 
        therefore which analytical tests should be performed. Without 
        the ability to conduct effective baseline testing, it will be 
        difficult if not impossible to establish causal responsibility 
        when chemicals are discovered where they do not belong. Pre-
        fracturing, baseline water quality testing avoids the defense 
        that ``the contamination was there before we arrived.'' If 
        fracturing chemicals are safe and leaks are unlikely, then 
        there should be little resistance to pre-fracturing disclosure.

        Prior disclosure is particularly important in areas that will 
        be fractured by multiple operators. For example, in North 
        Dakota's Bakken formation, over 3,000 new wells have been 
        drilled in the past five years with over 80 companies leasing, 
        drilling and hydraulically fracturing in the area.\17\ Without 
        prior disclosure, a landowner cannot know which operator will 
        be fracturing a particular well, or if fracturing fluids used 
        by different operators differ. (pp. 5-6)
---------------------------------------------------------------------------
    \17\ Natural Resources Defense Council and Sierra Club's Response 
to Questions for the Record from Chairman Wyden Regarding Disclosure 
Senate Committee on Energy and Natural Resources, May 23, 2013 Hearing, 
p. 4, submitted June 5, 2013, available at http://www.eenews.net/
assets/2013/06/07/document_ew_01.pdf.
---------------------------------------------------------------------------
8.)  Ms. Epstein, what would be your recommendations for strengthening 
        the Obama administration's proposed fracking rule? What are the 
        main issues that you think should be addressed before the rule 
        is finalized.
    See the first paragraph in our answer to Question 5.
                                 ______
                                 
    Mr. Lamborn. OK, thank you. We will now do our question 
portion of the hearing. And we do have votes coming up around 
10:45, so we are going to try to conclude at that time. But we 
will get in as many questions as we can between now and then. 
And they may go a little bit longer. We will find out.
    Commissioner Foerster, does the hydraulic fracturing 
section of the STRONGER guidelines that you referred to provide 
comprehensive guidelines for all issues relating to hydraulic 
fracturing?
    Ms. Foerster. Chairman Lamborn, yes, it does. I know you 
are in a hurry, but let me quickly go to Section IX and read 
you some of the things.
    Mr. Lamborn. Is your microphone on?
    Ms. Foerster. It is. I am just bad at using it. Yes. Yes, 
it does. Let me just read you--go to Section IX, ``Standards 
for Casing and Cementing; Standards for Water Handling; 
Standards for Fluid Disposal; Wastewater Treatment; Reuse and 
Recapture; Well Water Sampling.''
    Mr. Lamborn. OK, thank you.
    Ms. Foerster. Yes.
    Mr. Lamborn. Would you be able to leave us a copy of that?
    Ms. Foerster. I will leave you a copy of this.
    Mr. Lamborn. Now, what is your response when Secretary 
Jewell says that we need national minimum standards?
    Ms. Foerster. Again, Chairman Lamborn, sure, we need them, 
but we have already got them. The IOGCC, the STRONGER, API 
provide those standards. And the States can use them and do use 
them. And any new State that needs a standard has got it. It is 
right here.
    Mr. Lamborn. What has been the record of BLM in regulating 
energy development in Alaska?
    Ms. Foerster. In one word, abysmal. But the BLM operates 
over 100 wells in Alaska that have been in violation of Alaska 
regulations, especially those on safety and environmental, for 
a long time. And their answer is, ``Federal law trumps State 
law; you can't make us clean them up.'' Some of the wells are 
currently leaking hydro-carbon gas, and they are not doing 
anything about it. Some have leaked oil. Some of the sites are 
drowning hazards for children and small animals. Some of the 
sites are just a mess, littered with glass, plastic, metal, 
wood debris, piles of dried-up drilling mud of various 
concentrations and compositions. I will go back to the word 
``abysmal.''
    Mr. Lamborn. And with that record, they want to tell all 50 
States how to run their business?
    Ms. Foerster. Yes, they do. And another thing that they do, 
they recently, after the Macondo disaster, came to Alaska and 
drilled some coal bed methane wells, and they failed to use 
blowout prevention equipment. And then, when we tried to 
investigate that, they tried to hide it from us, after we had 
told them that they had to use it.
    Mr. Lamborn. That is amazing.
    Ms. Foerster. It is not amazing----
    Mr. Lamborn. That is amazing.
    Ms. Foerster [continuing]. It is disgusting.
    [Laughter.]
    Mr. Lamborn. Yes. Commissioner Craddick, in your testimony, 
you say because of the success of Texas in regulating energy, 
dignitaries from countries around the world, including Brazil, 
South Africa, Canada, and Mexico have visited Texas to learn 
about how you do things. Has the BLM or other Federal 
Government agencies come to you to likewise seek advice on how 
Texas is successful in regulating energy?
    Ms. Craddick. No, unfortunately. And actually they won't 
participate in our hearings when we have things. So we would be 
glad to visit with them at any time, but we feel like we have 
had a long history. People do come and ask us questions, and we 
now have, I believe, using API and STRONGER standards, one of 
the best casing rules now in the country that we have just 
done. So we would be glad to explain to them how we have done 
it.
    Mr. Lamborn. Well, here is another amazing thing. They are 
not even willing to take advice from the States and admit they 
can learn something.
    Mr. Rogers, in your testimony you point out that in 2012 
almost 9,000 onsite inspections were performed by DOGM field 
staff. In the course of these inspections, has your staff found 
any problems or issues with these wells that led you to believe 
further regulation at the Federal level is necessary?
    Mr. Rogers. Well, concerning hydraulic fracturing, there 
has been no incidents. There are obviously other issues that we 
may find, violations, but nothing that could be enforced by a 
Federal--I think we do a fine job on the local level.
    Mr. Lamborn. OK, thank you. Now, if someone raises a scare 
tactic and says, ``Oh, someone is going to set up an oil well 
next to Old Faithful Geyser,'' or something like that, what is 
the actual state of affairs when it comes to Federal iconic 
national parks and things like that?
    Mr. Rogers. Well, that would be fairly straightforward. To 
put a well beside Old Faithful, you would have to have a lease 
from that property to drill there, and I doubt any national 
park or Federal agency would lease that land to drill. So there 
would never be an opportunity to frack near anything of that 
sort.
    Mr. Lamborn. And you are aware that--because in Utah there 
are five national parks and a number of national monuments.
    Mr. Rogers. Yes. There would be no drilling there. As you 
know, in the past we have had leases pulled just because they 
are nearby a park or a wilderness area. So to drill right 
actually on a park would be--it just wouldn't happen.
    Mr. Lamborn. Thank you for setting the record straight. I 
would now like to recognize the Ranking Member for 5 minutes.
    Mr. Cartwright. Thank you, Mr. Chairman. And I want to move 
quickly, I want to get to each of you. I will start with you, 
Ms. Epstein. From your testimony, it seems that you are 
implying that under this bill, if any State has regulations 
pertaining to hydraulic fracturing operations, that oil and gas 
operations could occur on lands where such activities are 
currently prohibited. Is that what you are saying?
    Ms. Epstein. I am not a lawyer, but several attorneys have 
looked at this and said that the language is sufficiently broad 
and vague that perhaps it could be interpreted that if a State 
has a rule on hydraulic fracturing, that would trump any sort 
of Federal ability to oversee oil and gas----
    Mr. Cartwright. So, for example----
    Ms. Epstein [continuing]. Operations on Federal lands.
    Mr. Cartwright [continuing]. If a State law would trump 
Federal prohibitions on development in national parks, is it 
possible that Arizona could authorize drilling and hydraulic 
fracturing in the Grand Canyon?
    Ms. Epstein. I don't know that. Arizona could do that. We 
just heard a discussion about leasing in the Grand Canyon. If, 
perhaps, there is a portion of a park that Congress felt ought 
to be leased, it is possible. This is a theoretical 
possibility, given the language that we have right now.
    Mr. Cartwright. OK. Ms. Foerster, you state in your 
testimony that Secretary Jewell may have misled this Committee 
last week when she said there is no national standard for 
hydraulic fracturing. You then cite voluntary participation in 
NGO's, such as the Interstate Oil and Gas Compact Commission, 
which actually have no authority to regulate as a reason for 
this rebuttal.
    In my humble opinion, sharing information and promotion of 
best management practices, while important, is not a valid 
substitute for inspection, enforcement, and required 
construction standards. Does that IOGCC enforce any national 
standard over Federal lands, as your testimony implies?
    Ms. Foerster. Ranking Member Cartwright, through the Chair, 
as a State regulator, I can't think of any one of us who would 
refuse to take advantage of the best practices and guidelines. 
And I can't think of a single State who doesn't do it and who 
isn't already putting forth guidelines. We are all statutorily 
required----
    Mr. Cartwright. But it is voluntary, right?
    Ms. Foerster. We are all statutorily required by our State 
constitutions to do this job right, and this is the way we do 
it.
    Mr. Cartwright. But it is voluntary, right?
    Ms. Foerster. Well, it is voluntary for every one of us to 
do the job that it is statutorily required. And we can get 
fired if we don't.
    Mr. Cartwright. All right. Now, Ms. Craddick, in your 
testimony you wrote, ``Commission records''--the Railroad 
Commission in Texas records--``do not indicate a single 
documented water contamination case associated with the process 
of fracking in Texas.'' Did you write that?
    Ms. Craddick. Yes, sir.
    Mr. Cartwright. And I wanted to follow that up. You talked 
about Parker County, Texas, and you talk about, oh, a study 
that was done there by the Texas Railroad Commission that ended 
up agreeing that there was natural gas in the water wells of 
neighbors, but they concluded that the causation was an issue.
    In other words, they agreed there was natural gas in the 
water wells. And we all know from Pennsylvania what happens 
when natural gas gets in water wells. That is what leads to a 
video of people turning on the tap at home and they can light 
their tap water on fire. That is what happens, right?
    Ms. Craddick. Well, I would say, one, we know that in that 
part of our State we have naturally occurring natural gas in 
the water table already. And that was there before the----
    Mr. Cartwright. We will get to that. But that is what leads 
to those videos lighting your tap water on fire when there is 
natural gas in your well water, right?
    Ms. Craddick. Well, not in Texas, but potentially in 
Pennsylvania, I guess.
    Mr. Cartwright. OK. And the only thing that you came to 
issue with was the causation. Where did that natural gas come 
from that got in the water wells? Right?
    Ms. Craddick. The causation was the main part of the case. 
Yes, sir. And, frankly, if you already have naturally occurring 
gas, which we all knew, that is a well-known fact in that part 
of our State, that methane and natural gas exist in the water, 
so we knew that.
    Mr. Cartwright. I understand that was the conclusion of the 
Texas Railroad Commission. But what I am asking you is to get 
to that conclusion, did they use tracer elements? You know they 
are talking about putting regulations in to have tracer 
elements in the fracking process. That would just button down 
the proof about where the natural gas came from that got in 
people's water wells, wouldn't it?
    Ms. Craddick. Not necessarily. There are other ways to 
prove that. And one of the things that we did do in Texas is 
prove it by the type of natural gas, and where the gas came 
from, and where the type of gas you get out of a formation is 
like a tracer in some respects. It is very specific to where 
you get gas in different formations and----
    Mr. Cartwright. So do you oppose tracer regulations?
    Ms. Craddick. I think it is a potential tool, but I don't 
think it should be mandated any place at this time.
    Mr. Cartwright. All right. My time has expired.
    Mr. Lamborn. OK, thank you. Representative Flores?
    Mr. Flores. Thank you, Mr. Chairman. Ms. Foerster made a 
comment a few minutes ago saying my bill may affect leasing 
activities on Federal lands. I just want to assure everybody 
that it doesn't.
    During his opening testimony, the Ranking Member said that 
tribal issues had been ignored by my bill. That is a fact. It 
wasn't intentional. And we are going to work with members of 
this Committee whenever we have a mark-up on this bill to 
address that issue. And I think my friend from Oklahoma, Mr. 
Mullin, has an amendment that he may introduce to fix that. So 
we will address that.
    Let's pull up chart one, if we can. This gives, I think, a 
good overall view of what happens under a Federal regulatory 
structure, versus a State structure. So I would like Ms. 
Craddick, let's start with Commissioner Craddick, let's start 
with you. What happens if the Federal Government--actually, 
let's go to the third chart in this deck.
    Let's go to this one. This shows how the two different 
regulatory structures work in terms of permit processing time. 
Let's assume that the BLM goes where they would ultimately like 
to go, and that is have one standard for everybody. What would 
happen to oil and gas operations in the State of Texas if we 
wind up with this sort of Federal overlay?
    Ms. Craddick. I think it would basically shut us down 
because, one, we are doing it quickly and doing it well in 
Texas. And, like I stated, we do by rulemaking, we don't do by 
studies, we don't elaborate your permits. And what happens, if 
you don't follow the rules in Texas, we don't allow you to 
produce. And so, that is a real incentive, first and foremost, 
to get our business done. And frankly, we have been doing it 
well for a long time.
    Mr. Flores. And, Ms. Foerster, I apologize for the 
statement I said when I started this series. It was actually 
what Ms. Epstein said about leasing, it wasn't you. I apologize 
for that.
    Ms. Epstein, can you address the same question?
    Ms. Epstein. Yes, I can. Actually----
    Mr. Flores. I am sorry, I meant Ms. Foerster.
    Ms. Epstein [continuing]. I would like an opportunity, if I 
could, as well.
    Mr. Flores. For some reason I am getting my right and left 
confused today. So, Ms. Foerster, can you address that?
    Ms. Foerster. Well, I think Ms. Craddick pretty much summed 
it up, but----
    Mr. Flores. OK. Well, let's look at it this way. Under this 
you said it would shut us down. And so, presumably we would 
have a decrease in natural gas production. What would that do 
to greenhouse gas emissions in the country? Ms. Foerster, we 
will start with you.
    Ms. Foerster. Oh. Natural gas production is--even if you 
are strongly opposed to fossil fuels--natural gas is the 
bridging fuel to green technology and green fuel. And we don't 
have a green technology that is affordable right now and that 
can replace oil and natural gas.
    So, holy smokes, we need natural gas, because it is not a 
big greenhouse producer. If we don't have natural gas, we are 
going to use coal. And I apologize to the coal people in the 
audience. But, relatively, the greenhouse effect is much----
    Mr. Flores. Understand.
    Ms. Foerster [continuing]. Less with natural gas.
    Mr. Flores. Mr. Rogers, what would happen to the tax base 
in Utah? And I realize most of your tax base belongs to the 
Federal Government. But what would happen to the tax base in 
Utah if you had this type of a Federal overlay on top of what 
is a working State regulatory system?
    Mr. Rogers. The impression I get from industry is that 
people would tend to move out, because of the issue of trying 
to get a Federal permit. Right now we are seeing similar 
trends, where the people are moving away from Federal into 
State lands.
    But the problem is we have large tracts of lands with 
tribal, private, and State. And the industry is not going to 
just simply produce State and fee, they want the whole block. 
And so, having that overlay of induced regulation for the 
Federal Government, they tend to move elsewhere. So it would 
reduce the tax base. And so it would be----
    Mr. Flores. Ms. Craddick, what would happen to the tax base 
for K-12 education in Texas under a Federal processing overlay, 
Federal----
    Ms. Craddick. Well, right now we have $12 billion worth of 
taxes that the oil and gas industry pays. It is 25 percent of 
our economy. And when I say $12 billion in taxes, that is 
severance taxes, property taxes, sales taxes, our entire tax 
base. So you would see a large reduction in our tax base, and 
you would see our taxes increase, quite frankly, in the State. 
And I think you would probably see companies move out. And 
there are always other opportunities to go elsewhere in the 
world. We have finite resources, but people are willing to 
invest other places.
    Mr. Flores. Ms. Epstein implied in her comments that each 
of you are beholden to the oil and gas industry in your States. 
Can each of you, in the next few seconds, tell me for whom you 
work in your States? Ms. Foerster?
    Ms. Foerster. Mr. Flores through the Chair, I work for the 
people of Alaska.
    Mr. Flores. OK. Commissioner Craddick?
    Ms. Craddick. The people of Texas.
    Mr. Flores. Mr. Rogers?
    Mr. Rogers. The people of Utah, the State of Utah.
    Mr. Flores. Thank you. I yield back.
    Mr. Lamborn. I would like to now recognize Representative 
Lowenthal.
    Dr. Lowenthal. Thank you, Mr. Chair, and thank you to our 
witnesses for being here today.
    Well, I was very unhappy to see this bill introduced and 
this hearing called. To be clear, I strongly oppose this 
legislation. Instead, I think we should all want, and I know my 
constituents want, a minimum level of public health and safety 
for setting basic standards that all oil and gas operators 
should comply with.
    Now, again, I did not think that hydraulic fracturing is 
inherently a bad thing. And natural gas has the potential, as 
been pointed out, to be a low-carbon bridge fuel. But we have 
to do it right.
    Instead, this bill says that we shouldn't even try to put a 
minimum floor for protecting human health and safety. The bill 
says we should scrap any uniform public health and safety 
assurances on Federal and Indian lands for hydraulic fracturing 
all together.
    And let me remind all the witnesses. We are talking here 
about Federal Government setting public health and safety 
standards on Federal lands that are owned and governed by 
Federal law for the benefit and protection of all Americans. As 
much as many of the witnesses' testimony seemed to forget, 
these are not State lands.
    But let me touch on one issue that I am concerned about in 
the existing draft BLM fracking rule, and that is the long-term 
integrity and the public accessibility of the fracking fluid 
data in FracFocus.
    I notice in both your written testimony and your oral 
testimony today, Ms. Foerster, that you don't share my same 
concerns. In fact, you think they are unwarranted.
    Let me quote your prepared testimony. As you quote, ``I 
would like to clear up one more misperception from the hearing. 
Representative Lowenthal suggested that FracFocus is privately 
run and may not be maintained. Although funded by the DOE and 
industry, it is maintained by another State-funded NGO, the 
Groundwater Protection Council, in association with the 
Interstate Oil and Gas Compact Commission. Thus, the concerns 
about it being around in the future--the concern is 
unwarranted.''
    Ms. Foerster, how can you be so certain that FracFocus will 
exist in perpetuity? First, let me tell you that I have seen in 
my many years in public service prior to this, being both a 
city council member and a State legislator, that many NGO's 
come and go. And you know what? Their Web site and their data 
go with them.
    I have also seen State funding come and go. And their 
funding for NGO's come and go. So the fact that FracFocus is 
partly funded by the State also does not allay my concerns.
    So, I am wondering. Because we have been trying to get the 
answer to this and maybe you know something special that the 
BLM has not told us, Ms. Foerster, how can you be so certain 
that FracFocus will exist in perpetuity?
    Ms. Foerster. Representative Lowenthal through the Chair, 
first, State funding does come and go, but so does Federal 
funding. And the IOGCC has been around for 80 years, and as 
long as States like Alaska, Texas, and Utah strongly support 
it, it will continue to be around. And it funds and supports.
    Dr. Lowenthal. Ms. Epstein, do you think this is a problem?
    Ms. Epstein. I think it is an issue worth raising. We would 
certainly rather see a national data base. There are a number 
of reasons in addition to its perpetuity that a national data 
base would be preferable, because there would be more ability 
to be responsive to the public. FracFocus has a lot of issues 
that haven't been well addressed, and the public----
    Dr. Lowenthal. Yes, we will get back to that in just a sec. 
Any other witnesses? Do you have anything? Yes.
    Ms. Craddick. Well, I think one of the things that we have 
done in Texas is say, in our statute, that if anything happens 
to FracFocus you still have to continue reporting to the 
Railroad Commission, and that information continues going to 
us. So there is perpetuity----
    Dr. Lowenthal. No, you just----
    Ms. Craddick [continuing]. In our agency.
    Dr. Lowenthal. You just mentioned ``if anything happens,'' 
so you realize it could happen.
    Ms. Craddick. I don't think that it will. But if anything 
happens----
    Dr. Lowenthal. Thank you.
    Ms. Craddick [continuing]. We have put a backstop in our 
statute.
    Dr. Lowenthal. Thank you. And Ms. Foerster, do you agree 
with the BLM in the issue that was just raised by Ms. Epstein 
and the DOE and previous expert witnesses before this Committee 
that the data tools in FracFocus are insufficient for proper 
data analysis?
    Ms. Foerster. Representative Lowenthal through the Chair, 
FracFocus was created to provide a resource that an individual 
concerned entity could go to and find out the specific 
details----
    Dr. Lowenthal. Do you agree that the data----
    Ms. Foerster [continuing]. And FracFocus was not developed 
to allow Harvard to do sorting and collating of data. Harvard 
has a lot of really smart IT people----
    Dr. Lowenthal. Where else can one go for that data?
    Ms. Foerster. I beg your pardon?
    Dr. Lowenthal. Where else can one go?
    Ms. Foerster. You can----
    Dr. Lowenthal. Without a national data base.
    Ms. Foerster. Oh. As far as a national data base? FracFocus 
is that national data base.
    Dr. Lowenthal. And it is insufficient?
    Ms. Foerster. It is not sufficient for the purposes that--
--
    Dr. Lowenthal. Thank you.
    Ms. Foerster [continuing]. Harvard wants to use it for, but 
it is for the individuals----
    Dr. Lowenthal. I yield my time.
    Mr. Lamborn. Thank you. Representative Mullin?
    Mr. Mullin. Thank you, and thank you for my time. And, 
Chairman Lamborn, if you would just give me just a second, I 
know I am here to talk about sovereignty issues, but I have 
just got to say this. From a guy that is from Oklahoma, I have 
been in the plumbing industry my entire life. To hear my 
colleagues from the opposite side bring up this scare tactic 
about lighting tap water on fire, what a load of crap. I am 
just going to say it as plain as that. And it is shameful that 
they use such scare tactics.
    It is funny how people comment on things that they don't 
have, no offense, but a clue. And so I am just, I know that is 
stepping away, but, Chairman, sorry, I had to get that off my 
chest. I feel better now. So, anyway, my staff is probably just 
really upset at me right now.
    [Laughter.]
    Mr. Mullin. I may not be invited back to this Committee. 
All right.
    Anyway, Chairman Lamborn, thank you for letting me join the 
Subcommittee today. I applaud Representative Flores for his 
work on this legislation. In Oklahoma, we know a thing or two 
about fracking technology. We have been safely and effectively 
fracking since 1949. In fact, we have 193,000 current active 
wells in our State.
    As a member of the Cherokee Nation and someone who 
advocates for our Tribes, I do have some concerns with this 
bill in its current form. In this bill, as written, Indian land 
is not addressed. This Administration will continue to wrongly 
treat Indian land like public land. When it comes to Federal 
Indian policy, when we use the term ``Indian land,'' what we 
mean is land held in trust for our Tribes. To put it in simpler 
terms, Indians own this land. The public does not.
    In this proposed hydraulic fracking rule, however, the 
Administration treats Indian lands as though they are held for 
the benefit of the public, as well as Indian beneficiaries. 
This is contrary to the law. Unless Congress steps in, these 
actions by this Administration will proceed to harm Indian 
Tribes. Treating tribal land as public land is insulting, and a 
clear violation of the agreement between our sovereign nations.
    It is my hope that, as this bill continues to work its way 
through the Committee process, that my colleagues will work 
together to tighten up this proposal so we can assure the 
sovereignty of our nations is respected. Mr. Chairman, I yield 
back.
    Mr. Lamborn. OK, thank you. And I can say, with 
Representative Flores, as one of the two sponsors of the bill, 
that we will work to address the important issue of tribal 
lands. I thought we had already done so sufficiently, but we 
are happy to go the next step to make sure that gets done.
    Mr. Mullin. Thank you.
    Mr. Lamborn. OK. I would now like to recognize 
Representative Cramer.
    Mr. Cramer. Thank you, Mr. Chairman, Ranking Member 
Cartwright, and to the witnesses, for being here. I represent 
the congressional district of North Dakota. And one of the 
things I want to get into is this whole issue of a one-size-
fits-all national standard that we are talking about. And the 
closest thing to a country at the witness table would be Texas, 
of course.
    And I say that because Texas is a big place. And I would 
ask you, Commissioner, in Texas, do you have a statewide water 
standard, or do you treat West Texas differently than East 
Texas, in other words, do you have different hydrological sort 
of understanding and methods and standards, depending on where 
in Texas you are doing your work?
    Ms. Craddick. Well, right now, I think our best example is 
we do have a statewide casing rule that we have just passed. 
However, we have 10 field offices in the State, and there is 
lots of exemptions, because, you are correct, if you are in 
East Texas, you have a lot of water over there. If you are in 
West Texas, we have about 11 to 14 shale plays over there, and 
there is a lot less water. In fact, we are in a drought in West 
Texas. South Texas is very different, as well.
    So, we do have allowances. We try to have a standard. 
However, it is very difficult to have that across the board in 
a State as big as we are. So I can't imagine how you do it in a 
country as large as we are.
    Mr. Cramer. Well, I think one of the great illustrations, 
and thank you for this, but I think this Committee, the make-up 
of this Committee, and certainly the make-up of this panel, is 
Exhibit A, as to why we don't need a minimum standard.
    And I am sorry that my friend from California had to leave, 
because I think his point is an interesting point. He said 
something to the effect that ``my constituents want this 
minimum standard.'' And I don't doubt that they do. And, in 
fact, they have one. It is called the California standard. And 
for that they have high unemployment, they have a shrinking 
economy, they have 50 percent dependance on foreign oil, 25 
percent on oil from Saudi Arabia and Iraq, or Iran. They have 
to ship it on big ships, and it has a greater carbon footprint 
than if they piped it from North Dakota or Texas.
    So, they have their standard. Good for them. Good for them. 
But quite frankly, as I have said before, Mr. Chairman, I am 
not really sure why we would want to have the Federal 
Government impose its mediocrity on the excellence of our 
States.
    [Laughter.]
    Mr. Cramer. I mean in North Dakota we meet all ambient air 
quality standards. We have some of the cleanest water in the 
country. We have some of the richest top soil in the world that 
we use to feed hungry people. And, frankly, the sustainability 
of that land is far, far more important to the people that have 
been there for a couple of hundred years, and whose kin will be 
there for a couple hundred more.
    One other issue I want to explore just a little bit with 
regard to EPA, I have noticed that there was reference to, I 
think Ms. Epstein referenced to one of the questions something 
to the effect, she said, ``Perhaps it could be interpreted.'' 
Perhaps it could be interpreted. In other words, the standard 
is the possibility of things. As scientists, as engineers, do 
we set regulations based on what is possible? Or do we do it as 
the EPA is doing in their hydraulic fracturing investigation, 
use what is possible as the standard to determine what we 
should not allow?
    That is a very different standard. Those are very different 
standards. And I think, frankly, if we use what is possible as 
a standard, as opposed to say what is likely, or at least test 
the likelihood of it, we could stop pretty much everything from 
happening. Because anything is perhaps possible.
    Could somebody speak to that standard of possible, versus 
likely, as a minimum standard? Perhaps, Ms. Foerster, you could 
begin.
    Ms. Foerster. Well, as an engineer on the panel, I guess we 
put all of our regulations into place, not just in the oil and 
gas industry. We do everything we do based on something that 
has happened, or that science says could happen.
    When man hit the planet, we didn't have regulations. When 
this country came into place, we didn't have regulations. We 
have slowly built up a number of regulations based on science, 
based on facts, based on things that happen. And that is what 
we have. If we put regulations in for things that might happen 
or that we are worried could happen, I wouldn't have flown a 
plane here today.
    Mr. Cramer. Yes, that is a good point. Well, my time is 
expiring, so I will just wrap up by saying, yes, you are right, 
and we have been trying to add to the 10 Commandments and the 
Constitution pretty regularly the last couple of hundred years, 
and I don't think we have improved things much.
    So, with that, my time has expired, Mr. Chairman.
    Mr. Lamborn. OK, thank you. We will have 5 more minutes by 
Representative Benishek, and then we will wrap up this hearing 
so we can go vote
    Dr. Benishek. Thank you, Mr. Chairman and Ranking Member 
Cartwright. I appreciate the time. And thank you all for coming 
to Washington to testify.
    I have a question for Mr. Rogers. I have a great deal of 
tribal land in my district, and I know Utah has a lot of tribal 
land. And many Tribes would like to develop their land for oil 
and gas production, and yet they are subject to Federal 
regulations.
    In your interaction with any of the Tribes, what are their 
feelings versus the Federal versus the State regulatory 
schemes?
    Mr. Rogers. Right now, any kind of permitting done on a 
tribal property is done through the BLM. And I know that the 
Tribe has felt frustration of the length of the process, and 
how it is not moving along fast enough. They see other lands 
being permitted and drilled, and they are seeing they are sort 
of left behind. And so they are hoping to change that. It is a 
process that, we met with them and tried to help them and talk 
them through how we could help them. But right now, they feel 
frustration with the BLM process here right now.
    Dr. Benishek. I understand their dealings with the Federal 
Government are very frustrating. But do they feel if the State 
had control of the regulatory process they would be in a better 
position to develop their land?
    Mr. Rogers. I can't speak for the Tribe. But certain 
members of the Tribe and people I met with there feel that the 
process that we have and the faster turnaround time would 
certainly benefit them, compared to what they have right now. 
And so they have alluded that they would like to learn from us 
and do things similar to the way we are doing it, rather than 
the way the Federal Government is doing it.
    Dr. Benishek. Thanks. I want to follow up a little bit on 
Mr. Cramer's thought, too. You know, Michigan, we have the 
Antrim Shale, which is a large natural gas formation in my 
district, and natural gas production is a huge employer in my 
district. And he mentioned the differences in formations 
around, even the State of Texas. But the State of Alaska has 
different concerns, as well.
    And Ms. Craddick, what is your opinion on this one-size-
fits-all regulatory plan for the State of Alaska? I mean your 
formations are different than Texas. Explain to me a little bit 
further why you don't feel a blanket plan is the answer.
    Ms. Foerster. Which one of us were you asking?
    Ms. Craddick. I am from Texas; do you want from the Alaska 
or Texas----
    Dr. Benishek. Oh, oh, I want the gal from Alaska, sorry.
    Ms. Craddick. We will give you both, but----
    Dr. Benishek. Sorry.
    Ms. Foerster. Alaska?
    Dr. Benishek. Yes.
    Ms. Foerster. Well, Alaska has, as does every single State 
that you talk to, we have things that make us different and 
special.
    One, we are probably the only State that deals with 
permafrost, the first thousand feet or so of our land up on the 
northern part of the State is frozen. So there are no fresh 
ground waters, and there are engineering and geologic issues 
that you have to address in how you drill and produce the wells 
that deal with permafrost. Nobody else has that. A Federal 
standard wouldn't address that.
    We have some of the things that other States might be 
concerned about, I know there is truck travel with the 
increased activity. That is the least of our worries, because 
most of our State doesn't even have roads. So, for us, it is 
tundra travel, and it can only be done during the winter on 
ice.
    So, we are just rife with unique issues that we have to 
address that aren't part of a national standard, and wouldn't 
be appropriate in a national standard. But they are really 
important to us. And we know about them, and we deal with them 
every day, and that is why we are the best ones to regulate 
them.
    Dr. Benishek. Thank you. I will yield back, in view of the 
votes. Thank you.
    Mr. Lamborn. OK, thank you. Let me set the record straight. 
On this legislation, besides the original sponsor, 
Representative Flores, there are four cosponsors: 
Representative Doc Hastings, who is the Chairman of the Full 
Committee; myself; Representative Cynthia Lummis of Wyoming; 
and Representative Henry Cuellar of Texas. This is a bipartisan 
list of cosponsors that are happy to be on this legislation.
    I want to say that I have chaired a lot of Subcommittee 
meetings and I have sat in on a whole host of Committee 
meetings over the last 6\1/2\ years. And of all of the witness 
panels I have ever seen, this has been maybe one of the very 
best. All four of you bring a lot to the witness table. You 
have all been clear, passionate, articulate, persuasive. So I 
just want to express appreciation for all four of you for being 
here, giving of your time, and helping us understand this 
important issue.
    If any members of the Committee submit questions to you in 
writing, I would ask that you would respond to those. And if 
there is no further business, we stand adjourned.
    [Whereupon, at 10:49 a.m., the Subcommittee was adjourned.]

    [Additional material submitted for the record follows:]

    [A letter submitted for the record by the Energy Producing 
States Coalition (EPSC), follows:]

July 25, 2013

The Honorable John Boehner
Speaker of the U.S. House
U.S. House of Representatives
Washington, D.C. 20525

The Honorable Nancy Pelosi
Speaker of the House
House Democratic Leader
U.S. House of Representatives
Washington, DC 20515

Dear Speaker Boehner and Representative Pelosi:

    As the Executive Committee of the Energy Producing States Coalition 
(EPSC) and on behalf of the EPSC membership, we wish to express our 
support of H.R. 2728, the ``Protecting States' Rights to Promote 
American Energy Security Act,'' and encourage all Members of the House 
of Representatives to support this important bill.
    EPSC is a group of state legislators working together to develop 
positions on matters of common interest to energy producing states and 
advocate for sound public policy on issues that affect domestic energy 
production and transmission. The group was founded in 2011 and 
currently includes legislators representing 13 states including Alaska, 
Arizona, Colorado, Idaho, Indiana, Mississippi, North Dakota, Ohio, 
Oklahoma, Texas, Utah, Wisconsin and Wyoming.
    EPSC believes that expanded domestic energy development is vital to 
economic growth and job creation. In the midst of the recent economic 
downturn, the energy sector led the economic recovery and job creation 
and will likely continue to do so. The dramatic increase in domestic 
natural resource development over the past few years has been largely 
due to the innovative process of hydraulic fracturing. Currently, 
states where this process takes place have established regulations that 
developers are familiar with to ensure that necessary precautions are 
taken to safely develop energy while at the same time protect the 
environment. As legislators representing many of these states, as well 
as other elected, community, business and labor officials, we are 
committed to protecting our environment in addition to developing our 
natural resources to provide needed economic growth and job creation.
    Existing state regulations for hydraulic fracturing have proven 
successful, providing strong environmental, health and safety 
protections as well as regulatory certainty. As state legislators, we 
understand the specific needs and concerns of our communities more so 
than the federal government ever could. With different geologies among 
the states, a standard federal regulation on hydraulic fracturing would 
not be as effective as existing state by state regulations that take 
into account state specific concerns.
    The potential for delaying natural resource development would have 
a serious negative impact on our states in terms of reduced employment, 
economic growth and federal mineral revenues. Adding yet another layer 
of regulation would increase federal spending and provide the federal 
government with yet another excuse to reduce our state's share of 
federal mineral revenues. Already this year, the Department of the 
Interior has arbitrarily reduced state's share of federal mineral 
revenues by nearly $110 million and adding additional federal 
regulations will only limit state's share by reducing overall natural 
resource development within our states on public lands.
    H.R. 2728 allows those regulators who know the community best to be 
the one's leading oversight of those communities. It would eliminate 
the potential for duplicative regulations whose only goal would seem to 
be to delay the production of natural resources on public lands. 
Existing state regulations are already in place and as technology 
improves, development should not be hindered by extended regulatory 
delays brought on by the federal government.
    Greater clarity about the ability to access and develop domestic 
resources is necessary for long-term investment decisions. With so much 
uncertainty due to regulatory adjustments advocated by Washington, DC, 
potential investment in our states and workforce likely will be delayed 
or even cancelled. In order for investment to remain in our 
communities, the federal government must foster a more certain and 
encouraging operating environment for energy producers. Approving H.R. 
2728 would allow existing state hydraulic fracturing regulations to 
remain the primary regulation entities must follow. The Department of 
the Interior should recognize the value of and defer to existing state 
regulations and focus on other more pressing issues currently facing 
the Department.
    In closing, EPSC urges both Republicans and Democrats to vote in 
support of American energy development. Harnessing our domestic 
resources is in the best interest of our nation's consumers. We look 
forward to the House's action on this important measure.

Sincerely,

Representative Roger Barrus
Utah State Legislature
Chairman, EPSC

Speaker Thomas Lubnau
Wyoming Legislature
Past Chairman, EPSC

Senator Cathy Giessel
Alaska Legislature
Chairman-Elect, EPSC
                                 ______
                                 

    [The web ink to ``STRONGER Guidelines'' issued by State 
Review of Oil and Natural Gas Environmental Regulations 
(STRONGER) submitted for the record by Catherine Foerster 
follows:]

http://www.strongerinc.org/stronger-guidelines

                                 
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