New regulations for fracking advance in Kentucky House

FRANKFORT — A House panel voted unanimously Tuesday to approve the first overhaul of Kentucky's oil and gas drilling regulations in a generation, trying to get ahead of a possible "fracking" boom in the state.

House Bill 386, which proceeds to the full House, would tighten standards for high-volume hydraulic fracturing, or fracking, with new rules for landowner notification, water-quality testing and drilling site reclamation. In fracking, companies can inject millions of gallons of chemical-laced water under high pressure into deep, horizontal bore holes to break up rocks, unlocking oil and gas.

A working group representing the oil and gas industry, environmentalists and the Kentucky Energy and Environment Cabinet met during 2014 to draft the bill, said its sponsor, House Majority Leader Rocky Adkins, D-Sandy Hook.

"This is consensus legislation," Adkins told the House Natural Resources Committee. "I see this legislation really as a start ... really getting out in front of the industry, as well, as they continue to grow and really expand here in Kentucky."

Tom FitzGerald, director of the Kentucky Resources Council, called the bill "a significant first step." Fracking already is legal in Kentucky, FitzGerald said, but because it involves such new technology, few restrictions on it can be found in the state's drilling regulations, many of which date to the 1960s and '70s.

"We heartily endorse this legislation and encourage you to do the same," FitzGerald told the committee.

Vicki Spurlock, who lives in Madison County's Red Lick Valley, testified against the bill. Spurlock said oil and gas companies are asking her and her neighbors to sign mineral rights leases so the companies can tap into the Rogersville shale layer. Fracking would disrupt their community with the potential for water and air pollution, earthquakes and heavy trucks rumbling through the area, she said.

"I'm extremely concerned for our health and safety," Spurlock said. "Hydraulic fracking is nothing less than full-scale industrialization in the rural counties, basically, our backyards. Finding this out was a shock, and reading the long list of documented impacts coming from other states only increased my shock and raised my concern."

Spurlock asked the committee to shelve Adkins' bill and enact a moratorium on fracking, as the state of New York has, until scientific studies can determine its effect on public health. The committee declined.

Key components of the bill include:

■ A system to clean up abandoned oil-storage tanks.

■ A requirement for drillers to test any water impoundment or groundwater source near the surface site of a deep horizontal well that would be affected by drainage from the wellhead.

■ A provision for companies to notify landowners within 1,000 feet before starting a high-volume horizontal frack.

■ A requirement for companies to include a reclamation plan for deep vertical and horizontal wells.

■ Bonds to cover the cost of plugging and reclaiming the wells.

■ Disclosure of the names of chemicals used in a high-volume fracking operation, but not the volume and relative concentration used if the companies claimed it as a trade secret.

Kentucky has a relatively small oil and gas industry, compared to drilling giants Texas and Louisiana, but it's growing.

In 2014, total production value for oil and gas in Kentucky was nearly $720 million, an 8 percent increase over 2013, according to the Kentucky Oil and Gas Association. That included 3.3 million barrels of oil. The state's natural gas drilling was concentrated in Eastern Kentucky, primarily in Pike, Floyd, Knott, Letcher and Perry counties.

Overall, 33 of Kentucky's 120 counties reported natural gas production last year, and 61 reported oil production.

This story was originally published February 24, 2015 at 11:05 AM with the headline "New regulations for fracking advance in Kentucky House."