It was always a longshot that the Obama administration or Congress would crack down on the golden goose of hydraulic fracturing.
The chances shrunk further Thursday with the release of a landmark U.S. Environmental Protection Agency study that found the drilling method had no widespread impact on drinking water.
“That is as close as the federal government gets to saying, ‘I’m not that interested in you,’” said Michael McKenna, a pollster and lobbyist close to Republican lawmakers.
Fracking has helped bring about a boom in U.S. oil and gas production, turning the world’s largest hydrocarbon user into its largest producer. With that boom have come complaints that it’s fouled water supplies, polluted the air and even triggered earthquakes.
Some communities and states have responded by banning fracking, in which millions of gallons of water mixed with sand and chemicals are forced underground to free natural gas or oil. Environmental groups have urged Congress to strip a 2005 exemption of fracking from drinking water laws and asked the EPA to tighten rules on disclosure of the chemicals used and limits on the methane emitted.
“The EPA fracking study does not appear likely to spur additional federal water regulation beyond initiatives that are already in process,” Kevin Book, an analyst at ClearView Energy Partners, said in a research note.
That’s good news for companies such as Halliburton Co. and Schlumberger Ltd., the largest oil services companies, as well as producers Exxon Mobil Corp. and Chesapeake Energy Corp., as they weather a drop in oil and natural gas prices.
The 998-page EPA study concluded there are “mechanisms by which hydraulic fracturing activities have the potential to impact drinking water resources.” But, it “did not find evidence that these mechanisms have led to widespread, systemic impacts on drinking water resources.”
Thomas Burke, the EPA’s top science adviser, told reporters that given 30,000 fracked wells each year, “the number of documented impacts on groundwater resources is relatively low.”
Industry groups said that result vindicated what they have been arguing for years: drilling activity has risks, but fracking doesn’t deserve new federal oversight because the risks of underground water contamination is low.
The study “is absolutely consistent with all the previous studies that show that effective well containment practices make hydraulic fracturing a very safe practice,” Alan Jeffers, a spokesman for Exxon, said in a telephone interview Thursday.
The report’s conclusions don’t provide any support for fracking regulations proposed by congressional Democrats, said Larry Nettles, a partner with law firm Vinson & Elkins who represents several industry clients that supplied data for the study.