Industry representatives and state officials regularly make the case that states are doing a superb job when it comes to regulating the oil and gas industry and protecting the public. Unfortunately, there is a lot of evidence to the contrary. State regulations are outdated, enforcement is weak, and states are not able to keep up with the expansion in oil and gas production. A report out today from Colorado underscores our concern.
The Colorado Oil and Gas Conservation Commission is about to hold a hearing on natural gas waste spills that occurred more than three years ago. On the one hand, it is better to hold these hearings late than never. On the other hand, news reports are that it has taken this long because the agency has staffing limitations and enforcement cases can be difficult and time-consuming. The agency also spent some time updating some of its rules, which is a good thing, but it seems that it didn't have enough staff to both revise its rules and enforce its rules at the same time. As one concerned citizen wrote about West Virginia recently: "If they are so understaffed, why do they continue to issue permits for the drilling?" It's a good question without a good answer.
Here are some other examples of regulators that cannot properly oversee oil and gas drilling:
- North Dakota: State officials said that they are "understaffed and overwhelmed" and "struggling to provide adequate oversight amid an explosion of activity in North Dakota's oil patch." It is reported that hundreds of oilfield spills and thousands of waste disposal sites are being untended or are infrequently monitored because of a lack of personnel and funding.
- Pennsylvania: state regulators say they spend "as little as 35 minutes reviewing each of the thousands of applications for natural gas well permits ..... And the regulators say they do not give any additional scrutiny to requests to drill near high-quality streams and rivers even though the waterways are protected by state and federal law."
- Texas: In 2010, ProPublica published a very important report on the inadequacy of state oil and gas enforcement across the country. For example, the investigation found that Texas has over 270,000 wells (including disposal wells) and only 83 field inspectors. Nearly half of the wells had not been inspected in the five years between 2001 and 2006, and 30 percent of spill complaints were inspected late or not at all.
If companies think that it will take years for a regulator to review any violations, and their current operations will not be hampered by government regulators, where is the incentive to ensure strict compliance with the rules?