New Northwest Territories Fracking Regulations Keep Chemical Disclosure Voluntary

The government of the Northwest Territories celebrated one year of full control over its natural resources last week by releasing its own rules for hydraulic fracturing in the territory, but critics wonder if the new regulations are actually a step up from existing requirements.

The territorial government proposed a number of "enhanced" regulations promising increased reporting, disclosure and baseline information for companies applying to perform the controversial shale oil and gas drilling method more commonly known as "fracking" in the territory.

"This is the first significant step that the government of the NWT has taken to put a distinctly Northern stamp on the regulatory system that we now govern," said Industry, Tourism and Investment Minister David Ramsay, who also serves as head of the new NWT energy regulator, to media during a press conference on April 1.

Fracking in the NWT is currently overseen by the National Energy Board (NEB), whose new filing requirements for fracking were launched in the fall of 2013. The new NWT regulations keep those requirements, giving them the force of regulations, but are intended to boost stringency in four Northern priority areas that include water and air quality, and enhanced disclosure and reporting.

But while the regulations do put in place new measures for air and water monitoring, many are puzzled by the claims of increased requirements around disclosure, whereby companies are expected to make public the toxic ingredients contained in their fracking fluids and chemical additives.

Like the existing NEB requirements, the proposed NWT regulations do not require mandatory disclosure, leaving it up to companies to decide whether or not they will divulge the chemical makeup of the substances used to drill, fracture the shale bed and extract oil or gas to the surface.

In fact, the need for explicit consent from companies is written into the territory's oil and gas legislation, which prevents the regulator from forcing operators to publicly disclose information due to proprietary rights.

Where the new regulations are an improvement is in that they explicitly ask a company to disclose, rather than ask if they are willing to do so, according to director of petroleum resources for the NWT government, Menzie McEachern.

"This may seem trivial, but it is a different approach," he said. "Also, if an operator does not publicly disclose this information, then they must state publicly why they will not. The NEB guidelines did not have this last provision."

While they can't force companies to make information public, McEachern said unwillingness to voluntary disclose will be taken into consideration by the regulator when granting authorizations to companies.

Disclosure must be mandatory: critics
Still, many wonder why the government didn't make disclosure mandatory with its new rules when other jurisdictions are already moving in that direction.

"What I find astounding is that two or three weeks ago, the Obama administration made full disclosure mandatory on public and tribal lands in the States, so this is where the whole discussion is going," said Lois Little, co-chair of the NWT chapter of the Council of Canadians and a member of Fracking Action North, a coalition of nonprofits demanding a full environmental assessment of fracking in the NWT before another project is given regulatory approval.

"Why in the world would we be so regressive in terms of maintaining the status quo, when research is daily giving people cause for concern, and a lot of that has to do with the chemicals used and privacy industry holds?" she asked.

Companies looking to conduct fracking in the Sahtu promised the NEB in 2013 that, despite the lack of a mandatory requirement, all fracking chemicals would be disclosed to the public before and after fracking a well. That promise aligns with the Canadian Association of Petroleum Producers' own guidelines for companies.

ConocoPhillips, the sole company to carry out horizontal fracturing in the NWT to date, made good on its word while drilling two exploratory wells near Norman Wells last year, providing a list of all possible chemicals to be used in their fracture program and their concentrations beforehand, as well as a list of those actually used following each frac.

The company did admit, however, that its frac stimulation provider Schlumberger does not provide details on the exact mixture of each of their products—considered trade secrets—and that wastewater returning to the surface can have undergone chemical reactions with naturally occurring underground substances, rendering the composition of the flowback fluid unpredictable.

Flowback fluid is irremediable and must be disposed of in underground storage wells on-site or transported by truck to licensed sumps. Though changes to flowback fluid typically involve increased salinization due to underground minerals, there have been cases of increased radioactivity.

"If we want to be really responsible, why not require full public disclosure, in terms of the type and volume of chemicals, but also the type recovered?" Little said.

Disclosure methods still conceal trade secrets
Concerns with trade secrets go far beyond the issue of voluntary or mandatory disclosure, however, as others are quick to point out. Recent reviews of the internationally recognized best practice for industry disclosure of frac fluids—the website FracFocus—shows that companies are still able to claim proprietary rights when posting their list of chemicals.

A new report, published in March by the US Environmental Protection Agency, found that at least one ingredient was listed as a trade secret in over 70 percent of FracFocus entries, and that companies designated 11 percent of all ingredient records as confidential business information.

It's why people like Jessica Ernst, a former oil patch consultant from Alberta who is suing Encana over allegedly contaminating her drinking water through fracking, argues that when it comes to disclosure, regulations need to have sharper teeth.

Ernst thinks there needs to be zero tolerance for trade secrets when it comes to ingredients posted on sites like FracFocus or the Material Safety Data Sheets (MSDS) for each substance that are handed to regulators, and that the exact information on mixtures, concentrations and Chemical Abstract Numbers needs to be made public well before fracking occurs—not a month after, as currently permitted by regulators in the NWT.

"We need specifics, for drilling additives, for cementing additives, and for perforation chemicals," Ernst said. "Never mind what's being injected underground, but for what will be driving on the highways. If there's an accident, emergency people won't know what to do."

There is precedence for Ernst's concerns. In 2008, an emergency room nurse in Colorado, Cathy Behr, nearly died after being exposed to a "mystery frac chemical" a patient was doused in. She lost her sense of smell and spent 30 hours in intensive care after her organs began shutting down.

Although the company provided MSDS sheets to Behr's doctors at the time of the incident, it refused to provide them with more specific information once she fell ill, according to news reports, meaning her doctor had to guess what to do to keep her alive.

"If they're only required after, then it's too late," Ernst said. "The only way to do this is that companies must disclose, it must be listed publicly and at least a month before drilling starts."

Fracking contested in the North
Beyond the issue of disclosure, many in the NWT say the government is getting ahead of itself in allowing the unconventional horizontal drilling practice into the territory.

"The decision hasn't been made in any public way that Northerners want to get into the fracking game," Little said. "It's a bit presumptuous of these folks, especially when outlining the so-called 'Northern values' and that kind of devolution talk."

It's not just Fracking Action North that has expressed concern. The Dene Nation, which represents every Dene First Nation in the territory, passed a resolution calling for a moratorium on fracking in 2011. The Gwich'in Tribal Council recently followed suit, and the Sahtu Secretariat Inc.—the aboriginal government whose land is the area being eyed by fracking companies—last year called for a comprehensive regional review of fracking before further projects are approved, supported by NWT MP Dennis Bevington.

Similar demands are being made in the Yukon, where a government-appointed committee recently completed a lengthy public consultation on whether or not fracking should be allowed in the territory. The resulting report reflected a lack of consensus among the committee, though the primary recommendation was for more research to be done on the potential impacts to the land, air and water.

Other Canadian jurisdictions have banned the practice altogether, like Quebec, New Brunswick, Nova Scotia, and Newfoundland, along with numerous American states and countries such as Scotland, Wales, and France, among others.

The draft NWT regulations are now open to the public for comment. A 90-day review and engagement period, which will include stops in 11 communities across the NWT, begins this week.

Aboriginal governments, existing oil and gas regulators, companies, and industry lobbyists will also be included in the consultation. Input from the engagement sessions will be made available online on a regular basis and the results of the review shared, and final changes to the regulations are scheduled to be completed by June or July, with final regulations brought into effect by August 2015.

Meagan Wohlberg is an award-winning journalist based out of Fort Smith, NWT and editor of the Northern Journal. Follow her on Twitter.