settlements

Wed, 2014-07-23 09:08Sharon Kelly
Sharon Kelly's picture

Pennsylvania Environmental Regulators Flunk State's Own Shale Gas Audit

In January 2013, Pennsylvania's auditor general announced that he would conduct an investigation into whether state regulators were effectively overseeing the impacts from the shale gas drilling rush.

A year and a half later, the results are in: the state's environmental regulators are failing badly in at least eight major areas, at times declining to cite drillers who broke the law. In a damning 158-page report, the state's auditor general highlighted the agency's wide-ranging failures. The report detailed the Department of Environmental Protection's (DEP) use of a legal “loop hole” to avoid inspecting wells and described the agnecy's failure to fulfill its duty to track the industry's toxic waste. The report also faulted the agency for a reliance on voluntary measures in policing the industry.

The federal government has largely taken a hands-off approach to policing the drilling boom. What federal rules do exist have various broad exemptions exemptions for the oil and gas industry. Pennsylvania, which features a large swath of the Marcellus shale, is widely viewed as ground zero for the current fracking boom. In the unusually candid report released this week, state auditors have concluded that the state is overwhelmed by the industry and is providing insufficient oversight.

“It is DEP’s responsibility to protect the environment from these environmental risks and to ensure that laws and regulations which govern potential impacts to water quality are enforced,” Pennsylvania's auditors wrote. “Unfortunately, DEP was unprepared to meet these challenges because the rapid expansion of shale gas development has strained DEP, and the agency has failed to keep up with the workload demands placed upon it.”

Auditors described state environmental regulators as woefully outgunned and unprepared for the sudden arrival of the shale gas drilling frenzy.

Thu, 2013-03-28 05:00Sharon Kelly
Sharon Kelly's picture

More Financial Worries Coming to Light in Domestic Shale Drilling Industry

Virtually anyone who has followed the onshore drilling bonanza knows the name Aubrey McClendon and the company he co-founded, Chesapeake Energy.

McClendon was the hard-driving CEO and chairman of one of America’s most aggressive drilling companies, but he was brought down earlier this year after a string of financial scandals and potential conflicts of interest came to light. It turned out that at the heart of the natural gas industry’s poster child lay financial practices that drew the ire of investors, the attention of SEC investigators and the fixation of the news media.

But in the past several months there have been a series of largely under-reported events that demonstrate that Mr. McClendon's problems are by no means distinct.

Might the drilling industry have broader financial issues?

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