The US Interior Department announced drillers on government property must reveal the kind of chemicals they use, comply with construction benchmarks for wells and get rid of contaminated water using safe measures.
According to a legal counsel of an industry alliance of drilling companies, this policy made by the Bureau of Land Management will just aggravate departure from federal and ancestral lands to private property administered by more conventional state laws.
The law firm’s spokesperson also said it will adversely affect domestic employment and federal revenues.
The company (Baker & Hostetler) represents Western Energy Alliance as well as Independent Petroleum Association of America in a court case challenging said regulation in a federal court in Wyoming. The lawsuit stated that rule was based on unproven concerns.
Research conducted on behalf of Western Energy Alliance disclosed the federal regulation will put in $97,000 to the cost of one oil well.
On the other hand, Interior Secretary Sally Jewell told media representatives that the new law protects government land resources and guarantee responsible development.
There are over 100,000 oil wells located on federal property and comprise 11 percent of natural gas output and five percent of crude production. 90 percent of these companies use hydraulic fracturing.
The government estimated compliance cost at $5,500 for each well. The shale well costs roughly $7 million. This rule will be effective after three months.
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