REGULATION

In Fla., fracking starts a fight before it even happens

The oil industry and environmentalists in Florida, who fought to a draw in the state Legislature over a bill that would allow hydraulic fracturing in the state, are maneuvering for a rematch.

The bill drew some of the most heated disputes in Tallahassee, even though Florida has a tiny amount of oil and gas production and it's not likely that there would be widespread drilling even if a law passes. The bill would allow hydraulic fracturing and would prohibit cities from regulating the practice.

"The word 'fracking' has become one of those issues that immediately sends people into their respective corners -- facts be damned, and it doesn't matter what side you're on," said Rebecca O'Hara, a lobbyist for the Florida League of Cities Inc.

State Sen. Garrett Richter, a Republican from Collier County who sponsored the bill, pulled it from consideration during a hearing March 1. The Legislature reconvenes in 2017, and the issue of fracking is likely to come back.

If a bill passes, Florida would join Illinois and North Carolina in regulating a drilling practice that hasn't actually happened on a wide scale (EnergyWire, Nov. 7, 2014; EnergyWire, May 6, 2015).

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Fracking typically is used on shale and other dense rocks, which makes it hard for oil and gas to flow. It's controversial because it's allowed drilling to push into new areas, including suburban areas in Texas and Colorado and farm country in Pennsylvania. There have been long-standing complaints about water pollution and other problems associated with shale drilling.

In most cases where contamination has been substantiated, it didn't happen because of fracking itself but because of faulty well construction that allowed gas, oil or other fluids to leak outside the wellbore. Regardless, the idea of drilling and fracking in Florida, which depends on groundwater for drinking, has caused a huge uproar.

Fracking is currently allowed under the Florida Department of Environmental Protection's regulations. It's classified as a "workover" -- one of a group of tasks that generally involve re-entering an old well to repair it or squeeze more oil out of it. But no one has fractured a well in the state since 2003, according to an analysis by the state Senate Appropriations Committee staff.

Florida produces small quantities of oil and gas -- there are approximately 160 producing wells in the state -- and the current crash in oil prices makes it unlikely that any new drilling would happen for months, if not years.

The company whose project spurred the legislation -- Dan A. Hughes Co. LP of Beeville, Texas -- wasn't actually trying to fracture a well. Instead, it applied for permission to use a different process known as matrix acidization -- forcing acid into a well at high pressure to dissolve some of the rock and allow oil to flow.

Hughes notified the DEP of its plans in 2013 and then went ahead with the operation before it received permission. The DEP sued the company to stop the acidizing.

Another company, Kanter Real Estate LLC, has applied for permission to drill a test well in the Everglades in Broward County. The company's application doesn't discuss fracturing or well stimulation, but the DEP has issued Kanter two requests for additional information, effectively delaying the project.

Pre-emption derailed Fla. bill

S.B. 318 would have provided $1 million for the DEP to conduct a peer-reviewed study of fracking, matrix acidization and other techniques to see if they could be safely used in Florida.

It would require companies to notify the state in advance of certain drilling operations, so that inspectors could be on site when they happen. Drillers would have to report the chemicals they use to FracFocus, a nationwide database.

The bill would pre-empt local cities from regulating any aspect of oil drilling, though, and would void any existing regulation. That would wipe out dozens of local ordinances that have been passed to ban fracking in cities and counties.

The pre-emption language caught the eye of two groups that have significant sway in Tallahassee: the Florida League of Cities and the Florida Association of Counties. The issue eventually derailed Richter's bill in its final Senate committee, when one member floated an amendment to remove the pre-emption language.

Richter and state Rep. Ray Rodrigues (R), who has shepherded a fracking bill through the House more than once, vow to bring the legislation back again next year. Other lawmakers will file their own proposals, some of which will call for an all-out ban.

O'Hara with the League of Cities said there are some positive aspects of the bill. It would give Florida a chance to update its oil and gas regulations, for instance.

But the idea of pre-empting any local control of drilling is a nonstarter, O'Hara said. An earlier version of the bill was more narrowly tailored -- it would have given the state sole authority to issue drilling permits but would have allowed cities to control some aspects of drilling, such as the location of drill sites, she said.

Opposition marches on

Environmentalists in Florida are gathering their own ammunition for a continued fight. Many flooded the committee rooms in Tallahassee, where hearings would often be long and heated.

Those who opposed the bills called for everything from an all-out ban to begging the Legislature to do something in order to boost renewable energy.

Anti-fracking activists from Pennsylvania and other states flew in to testify and hold rallies on the Capitol steps, which added to the attention.

"We've heard from the opposition that you can regulate fracking, but we can't," said Jennifer Rubiello, the director of Environment Florida. "We know that fracking has contaminated water, polluted air, the only safe way to regulate fracking is to stop it before it starts."

Karen Dwyer, an anti-fracking activist, has helped organize an 80-mile, six-day protest march across the Everglades and Big Cypress, from Miami to Naples this Sunday. Dwyer was a constant in Tallahassee, testifying at committee hearings and attempting to meet with lawmakers.

"We've given the Legislature two years to give us meaningful legislation," she said. "They just twisted it out of context and gave us a bill that was worse."

David Mica, longtime executive director of the Florida Petroleum Council, said he's frustrated with the bill's opponents, calling some of them "extremists."

Florida is the third most populous state in the country, and its hot climate means that air conditioners run nearly year-round in some of its communities, but it's heavily reliant on imported natural gas for its power supply.

Hurricanes Katrina and Rita in 2005, which shut down gas production off the Louisiana coast, showed just how much the state relied on natural gas.

The supply problem was so acute that Florida Power & Light Co., the state's biggest utility, signed deals to produce gas from fields in Oklahoma.

If gas can be produced in Florida, it's one more tool in the region's energy supply toolbox, Mica said.

"We want to be able to use, in the industry, the best tools available to us," he said, saying this includes fracking, matrix acidizing, well stimulation or another new technology that comes along. "You're talking about a technology that has transformed America."

Jennifer Hecker of the Conservancy of Southwest Florida is trying to find a middle ground. Her group isn't pushing for an all-out ban; it's trying to find a sponsor for a bill that'll ensure any regulations on fracking are based on science.

"Hopefully people have some time to calm down and realize that they need to work with the public," she said.

Twitter: @BizWriterKristi Email: kswartz@eenews.net

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