EPA Issues Draft Guidance for Oil and Gas Hydraulic Fracturing Activities Using Diesel Fuels

In an effort to inject (no pun intended) regulatory certainty into the permitting of underground injection wells used in oil and gas hydraulic fracturing (HF) operations, on May 10, EPA issued draft guidance for HF operators utilizing diesel fuels in their injection process.  EPA did not initially consider HF to be covered by its Safe Drinking Water Act (SDWA) Underground Injection Control (UIC) program.  EPA's view changed as the result of a number of court decisions which concluded that HF activities are subject to that program.  In 2005, the Energy Policy Act revised the SDWA definition of underground injection was modified to exclude from UIC regulation the underground injection of fluids or propping agents other than diesel fluids used in HF operations related to oil, gas and geothermal production activities.  This exclusion has, understandably, proven to be controversial, at least in part because there is no one definition of what constitutes "diesel fuel".  The EPA draft guidance attempts to bring clarity to the definition of what constitutes a diesel fuel, by examining whether the injectate is included in one of six identified chemical abstracts and whether the fluid is commonly referred to as "diesel fuel".  The draft guidance also  touches upon other issues associated with HF operations including which activities are covered by  the UIC program and the management of wells over their operational lifetime.

The comment period for the draft guidance closed on July 9, and the guidance, when finalized, will apply only to those jurisdictions in which the EPA directly implements the UIC program (fourteen states and territories and most tribal lands).  The guidance, along with proposed requirements for HF on public lands published almost contemporaneously (77 Fed. Reg. 27691; May 11, 2012), signal an intention of the federal government to bring certainty to a very uncertain and controversial issue, and to impact a rapidly expanding industry which has previously been subject primarily to state and local regulation.