June 10 2016

What the Frack Is Going On? Federal Agencies Perform Insufficient Assessment of California Offshore

by Amanda Winchell and Legal Intern Rachael Hiatt

Hydraulic fracturing—better known as fracking—has come into the spotlight in recent years as a controversial method of enhancing oil and gas extraction.  Offshore fracking – which frequently involves the dumping of toxic-chemical laden water into the ocean - is particularly controversial, given that the scope of the practice’s environmental impacts remains largely unknown. Yet despite the enigmatic nature of the environmental consequences of offshore fracking, the federal government has decided to lift the temporary moratorium placed on offshore fracking along the Southern California Outer Continental Shelf (OCS), ignoring recommendations to halt production or at least conduct a thorough environmental review before allowing the practice to proceed.

Offshore fracking is a technique that can be used to enhance the extraction of gas and oil from shale or other low-permeability formations beneath the earth’s surface. The process of fracking involves drilling wells deep into the earth, and then injecting a fluid mixture of water, sand and chemicals at high pressures into the shale rock. This fluid injection creates or enlarges fractures in the shale rock. The fractures then allow the rock to release its oil and natural gas from storage. The oil and gas then typically flows out into a well leading to the surface. Another way of explaining fracking is this analogy from a Beachapedia article that discusses both onshore and offshore fracking:

          “Have you ever been frustrated trying to drink a thick milkshake or smoothie through a straw and blown into the straw to clear a path to improve the flow? In effect, you just ‘fracked’ your drink.”

Fracking is problematic for many reasons. The chemical concoctions used by fracking companies that are injected into the earth, or ocean, often contain toxics that are harmful to human health and the environment. Further, the mixture of chemicals is often a protected trade secret, where the exact contents of the chemical mixture cannot legally be disclosed. So, precisely what is getting injected into the earth—or disposed of in the open ocean—can remain a mystery, despite the harmful nature of the chemicals.

Additionally, wells that are not properly cased or constructed are prone to rupturing. A ruptured well can lead to a release of oil or harmful chemicals into the environment, or a nearby drinking water supply.  For example, the infamous 1969 Santa Barbara Oil Spill was caused by a well blowout from an offshore platform. Not surprisingly, offshore well stimulation also poses threats to marine life from the fracking concoction and a possible rupture. As if this weren’t concerning enough, fracking can also lead to an increase in earthquakes in an area where fracking takes place, increasing the risk of oil and chemical releases into the environment.

Until January 2016, fracking was being conducted in wells drilled from offshore oil rigs in federal waters three miles off the California coast in the Santa Barbara Channel as was discovered and reported by the Environmental Defense Center (EDC) in 2011. Previously, offshore fracking and acidizing—a similar process which involves the application of toxic acids to wells or underground rocks—were conducted with no environmental analysis from federal agencies, nor public transparency. That is, federal agencies were previously not required to conduct a comprehensive environmental review of well stimulation treatments (WSTs), including acidizing and offshore fracking, before issuing permits to oil companies.

However, a January 2016 settlement agreement imposed a seemingly promising requirement for environmental analysis of California’s offshore fracking. The settlement stemmed from lawsuits filed against BSEE and BOEM by EDC and the Center for Biological Diversity (CBD) in 2014 and 2015 alleging numerous violations of federal environmental law. Specifically, violations of the National Environmental Policy Act (NEPA) were alleged. NEPA requires agencies to conduct meaningful full-scale reviews of projects that could potentially harm the environment before commencing the projects. This settlement essentially mirrored NEPA regulations that are in place for on-shore fracking projects, allowing offshore fracking to receive an equal amount of scrutiny.

The settlement required these federal agencies (who are both part of the Department of the Interior) to jointly analyze the potential negative environmental effects of offshore WSTs—read: fracking and acidizing—before potentially giving the green light to oil companies to resume these practices.  The settlement also placed a moratorium on fracking operations until a joint Programmatic Environmental Assessment (PEA) by the BSEE and BOEM could be completed. BSEE and BOEM were required to evaluate the significant risks and impacts of offshore fracking and acidizing on ocean resources and air quality.

The final PEA was issued on May 28, 2016. Disappointingly, the so-called “comprehensive” analysis of the PEA from the agencies on the use of WSTs found no significant environmental impacts from fracking and acidizing. This is what is known in environmental law-speak as a FONSI: a “Finding of No Significant Impact.” This FONSI allowed for the moratorium to be lifted and fracking operations to resume.

Surfrider Foundation believes this finding is incorrect for several reasons. The comments and recommendations made by EDC and Surfrider and others on the Draft PEA seem to have been largely ignored. While addressed in a comprehensive appendix, comments and recommendations were not integrated into the assessment itself. For instance, the comment letter submitted by EDC and Surfrider pointed out the need for adhering to the Coastal Zone Management Act (CZMA), which grants states oversight of Federal activities off state waters through a federal-state regulatory process. As the California Coastal Commission has communicated to BOEM and BSEE, the two federal agencies’ broad approval of fracking off the California coast has NOT undergone this consistency analysis with CZMA that must be conducted - and not on a case-by-case basis.

Additionally, the PEA’s purpose – as expressed by BOEM and BSEE – was not focused on a holistic and thorough environmental assessment of impacts on environmental, cultural, and social resources due to fracking, but instead was done to evaluate impacts of the “proposed approval of WSTs [fracking] on the 43 current leases and 23 platforms currently in operation…” From the beginning, the PEA was based on the proposed approval of fracking. This sets the foundation for an inherently questionable and biased objective, which is only compounded by statements that are found in the document including, “Assuming that the level of oil and gas consumption does not change, implementation of Alternative 4 (no fracking on existing leases) may lead to the drilling and production of new wells offshore and/or onshore.” This is an inappropriate comment. A tool such as an environmental assessment should not make speculations regarding consumer behavior. This leaves the coast open to future assaults due to a presumption of consumption-based need.

Moreover, the PEA had numerous information and data gaps regarding the toxicity of chemicals used in the fracking and acidizing processes. This was especially true with respect to acidizing, and the impact of those chemicals on the environment, including water quality, threatened endangered species, and human health.

EDC Staff Attorney Maggie Hall commented, “Fracking and acidizing present new and unstudied risks to the environment, such as the impacts on marine wildlife caused by dumping toxic frack fluids into the open ocean.” According to CBD attorney Miyoko Sakashita, “It’s disturbing that officials charged with protecting our oceans are shrugging off these risks and authorizing oil companies to resume this dangerous practice. The California coast can’t take another oil spill or a deluge of toxic fracking chemicals.” Furthermore, Rep. Lois Capps (CA-24) said “accidents caused by well stimulation are ‘reasonably foreseeable.’ Given our experience on the Central Coast, it is safe to say that it is not a matter of if these accidents will occur, but when.”