Skip to main content

North American drilling companies' methods are facing growing scrutiny that may curtail their efforts to tap a key U.S. source of natural gas.

In the latest signal of the increasing public and political concern over the drilling, a U.S. congressional committee is investigating drilling firms, including two Calgary companies, over concerns that their drilling for shale gas deposits may be contaminating water supplies.

Calfrac Well Services Ltd. and Sanjel Corp. have received letters from the House committee on energy and commerce, requesting information on all wells they've drilled over the past four years using a method known as hydraulic fracturing - including proximity to ground water sources and the chemicals used in the process.

Story continues below advertisement

The congressional investigation is part of a growing controversy in the U.S. over the practice of hydraulic fracturing, which injects solvents into gas-bearing geologic structures to break open the rock and release the hydrocarbons. The technique is key to the commercial development of North American shale gas deposits, an immense resource that has transformed the continent's energy picture.

The oil and gas industry warns that unwarranted regulatory burdens could slow the development of the strategic resource. And it insists that there is no threat to drinking water from the drilling practice - solvents are injected thousands of metres below any drinking water sources.

However, New York state, which sits atop stretches of the immense Marcellus shale gas deposit, has imposed a moratorium on drilling until it ensures the development won't threaten water sources.

There is also a push in Washington to increase federal regulation of the industry.

In Canada, provinces regulate the drilling industry. The B.C. government has raised questions about waste water treatment from deep drilling in the Montney and Horn River gas basins in the rugged northeastern part of the province, but there has been little public debate.

Calfrac received its letter late last week, but Tom Medvedic, its senior vice-president for corporate development, said the company could not comment until it had more fully reviewed it.

"At this stage, we're not really in a position to provide any comment … There is a lot of information that is being requested," Mr. Medvedic said.

Story continues below advertisement

"The fracturing process has been around for decades and, in that context, we certainly haven't been presented with any challenges like are now being projected."

Officials with Sanjel, a privately owned, Alberta-based company, could not be reached for comment.

The investigation is being conducted by the House subcommittee on energy and environment, amid growing calls for the U.S. Environmental Protection Agency to regulate the drilling industry. The subcommittee is chaired by Massachusetts Democrat Edward Markey, who is acting with Henry Waxman, the California Democrat who heads the full House energy and commerce committee.

In addition to Calfrac and Sanjel, the committee requested documentation from Halliburton Co., BJ Services Co., Schlumberger Ltd., Frac Tech Services Ltd., Superior Well Services Inc., and Universal Well Services Inc.

In a memorandum explaining their action, Mr. Markey and Mr. Waxman said the development of shale gas is "one of the most promising trends in U.S. energy supplies," with the potential to meet American gas demand for decades.

"But as the use of these [drilling]technologies expands, there needs to be oversight to ensure that their use does not threaten the public health of nearby communities," they said.

Story continues below advertisement

The congressmen said Halliburton, BJ and Schlumberger had agreed with the EPA to end the use of diesel and other highly toxic chemicals in their hydraulic fracturing, but that Halliburton and BJ had continued to use diesel.

The oil and gas industry argues state regulators are already providing that oversight, and worry that excessive federal regulation could discourage investment in the new energy source.

"Hydraulic fracturing is a safe technology critical to developing the nation's vast natural gas reserves," the American Petroleum Institute said in a release.

"It has been used for more than 60 years in more than one million U.S. wells without a single confirmed instance of groundwater contamination."

The environmental controversy could delay development of the Marcellus reservoir, said Bill Gwozd, vice-president of gas services for Ziff Energy Group in Calgary.

There are some 65 rigs operating in Pennsylvania - most of them doing horizontal drilling required for shale gas plays - and none at work across the state line in New York.

In addition to raising concerns about waste water treatment, Pennsylvania Gov. Ed Rendell has proposed a 5-per-cent tax on all gas produced in the state, a measure that the industry says could seriously undermine the economics of the shale gas development.

"The goose with the golden egg story pops up here," Mr. Gwozd said.

"Operations-type limitations include perceived and real environmental issues … although getting the facts on the table would be a huge first step."

Report an error Editorial code of conduct
Tickers mentioned in this story
Unchecking box will stop auto data updates
Comments

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff.

We aim to create a safe and valuable space for discussion and debate. That means:

  • Treat others as you wish to be treated
  • Criticize ideas, not people
  • Stay on topic
  • Avoid the use of toxic and offensive language
  • Flag bad behaviour

Comments that violate our community guidelines will be removed.

If your comment doesn't appear immediately it has been sent to a member of our moderation team for review

Read our community guidelines here

Discussion loading ...

Due to technical reasons, we have temporarily removed commenting from our articles. We hope to have this fixed soon. Thank you for your patience. If you are looking to give feedback on our new site, please send it along to feedback@globeandmail.com. If you want to write a letter to the editor, please forward to letters@globeandmail.com.