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Home » Business News/Analysis, North Dakota, Opinions, Policy

The Downside of the Boom

Submitted by on November 24, 2014 – 12:51 pmNo Comment

by Deborah Sontag and Robert Gebeloff  (The New York Times)   North Dakota took on the oversight of a multibillion-dollar oil industry with a regulatory system built on trust, warnings and second chances.

Blowouts represent the riskiest failure in the oil business. Yet, despite these serious injuries and some 115,000 gallons spilled in those first 10 blowouts, the North Dakota Industrial Commission, which regulates the drilling and production of oil and gas, did not penalize Continental until the 11th.

The commission — the governor, attorney general and agriculture commissioner — imposed a $75,000 penalty. Earlier this year, though, the commission, as it often does, suspended 90 percent of the fine, settling for $7,500 after Continental blamed “an irresponsible supervisor” — just as it had blamed Mr. Rohr and his crew, contract workers, for the blowout that left them traumatized.

In recent years, as the boom really exploded, the number of reported spills, leaks, fires and blowouts has soared, with an increase in spillage that outpaces the increase in oil production, an investigation by The New York Times found. … Its state leaders rarely mention the underside of the boom and do not release even summary statistics about environmental incidents and enforcement measures.

The Times found that the Industrial Commission wields its power to penalize the industry only as a last resort. It rarely pursues formal complaints and typically settles those for about 10 percent of the assessed penalties. Since 2006, the commission has collected an estimated $1.1 million in fines. This is a pittance compared with the $33 million (including some reimbursements for cleanups) collected by Texas’ equivalent authority over roughly the same period, when Texas produced four times the oil.

…  They prefer to work alongside industry to develop new guidelines or regulations when problems like overflowing waste, radioactive waste, leaking pipelines, and flaring gas become too glaring to ignore.

Over all, more than 18.4 million gallons of oils and chemicals spilled, leaked or misted into the air, soil and waters of North Dakota from 2006 through early October 2014. (In addition, the oil industry reported spilling 5.2 million gallons of nontoxic substances, mostly fresh water, which can alter the environment and carry contaminants.)

Though the industry now disposes of oil field brine primarily by injecting it deep underground, it still needs to be transported to disposal wells and remains a stubborn pollution problem. For every barrel of oil, about 1.4 barrels of brine is produced, state officials say, and far more of it spills than does oil.

And while the industry calls it saltwater — “which makes it sound harmless, like something you would gargle with,” said Derrick Braaten, a lawyer who represents farmers — it is highly saline and can be laced with toxic metals and radioactive substances.  READ MORE and MORE

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