Murky responses cloud plan to ship frack waste on Ohio River

By Mike Lee | 02/06/2015 08:40 AM EST

A Texas company’s announcement that it plans to ship fracking wastewater on the Ohio River has touched off a controversy, with environmentalists worrying that the company got around federal permitting requirements and federal agencies hedging on just how much permission they’ve given the company.

GreenHunter Resources Inc., based in Grapevine, Texas, announced last week that it had secured permission from the Coast Guard to ship thousands of barrels of wastewater from the Marcellus and Utica shale fields to its disposal wells in Ohio. The Army Corps of Engineers gave it permission to build a barge facility on the Ohio side of the river, the company said,

The Coast Guard said Wednesday that it’s still writing the regulations for shipping what it calls shale gas extraction wastewater and that it hasn’t given GreenHunter permission to start transporting waste on the river.


GreenHunter, however, said yesterday that it received a letter from a regional Coast Guard commander allowing it to ship "oilfield waste" — and the company contends that’s all it wants to do.

"We don’t even know what the hell shale gas extraction waste is," Kirk Trosclair, the company’s chief operating officer, said in an interview yesterday. "What we’re trying to transport is oil field waste and residual waste, which is basically brine, saltwater."

The distinction is critical. There are already regulations in place that allow shipping oil field waste, but the Coast Guard has spent the last two years writing regulations for shale gas wastewater. It’s currently responding to thousands of comments on its proposed rules and hasn’t given a date for when the process may be finished.

The Coast Guard confirmed that GreenHunter received the letter, but officials said the company may still have to clear more hurdles before it can begin shipping wastewater.

The Coast Guard doesn’t have a clear process for determining whether a cargo is oil field waste or shale gas waste, according to interviews with staffers in Washington, D.C., and Louisville, Ky. And the process won’t be clear until staffers in Washington finish writing the regulations for shale waste transportation.

"There are existing policies that are going to cover anything they wish to move," said Capt. Richard Timme, commander of the service’s Ohio River Valley sector.

"If it’s shale gas extraction wastewater, that [policy] hasn’t been established at the national level," Timme said.

Meanwhile, the Army Corps hasn’t given GreenHunter permission to build its barge unloading facility, according to Brian Maka, a spokesman in the agency’s regional office in Wheeling, W.Va.

Trosclair said the Army Corps has issued a permit, although it tied the permit to passage of the Coast Guard’s waste-shipment regulations. He didn’t respond to an email asking for a copy of the permit.

Using barges to ship the wastewater would give the company a cost advantage over other waste-haulers, since it’s cheaper to move materials by water than by truck or rail. It could also have some environmental benefits, because it would reduce the number of trucks carrying the waste on highways, Trosclair said.

GreenHunter specializes in collecting and disposing of wastewater from oil and gas operations. It recently sold assets in Texas and North Dakota so it could concentrate on the Marcellus and Utica shale fields in Ohio, Pennsylvania and West Virginia — which border the river.

Each shale well produces thousands of barrels of wastewater. Some of the water occurs naturally in the same rock formation with the oil and gas, and some of it is the leftover fluid from hydraulic fracturing.

Both streams of wastewater tend to be saltier than seawater and can contain a brew of pollutants including drilling chemicals, heavy metals and sometimes traces of oil and other hydrocarbons.

Pennsylvania’s geology, though, makes it hard to drill injection wells, which are the most common method for disposing of oil and gas waste. West Virginia has only a few dozen injection wells.

That has led to a booming industry transporting the waste to Ohio, which has about 200 disposal wells and more than 35 permitted or under construction, according to the state Department of Natural Resources.

GreenHunter operates injection wells in Portland, Ohio, along the river, and first approached the Coast Guard about transporting waste by barge in 2012 — using the regulations for oil field waste. That request touched off the rule-writing process, Trosclair said.

"We were forthcoming — we wanted to sure we had the blessing from everybody," he said. "We got almost to the end hour of actually putting a barge on the river and we were told to stand down by the Coast Guard."

GreenHunter’s stock has been battered by the downturn in energy prices, dropping from more than $3 a share in July to 73 cents on Jan. 26, the day before it announced its Ohio River expansion. The stock jumped 12 percent to 82 cents a share the day after the announcement.