Exxon CEO Defends Fracking on Capitol Hill

The CEOs of Exxon Mobil and XTO told Congress today that they’re confident hydraulic fracturing is safe: Over 1 million wells drilled with that method and no documented water table contamination, they said.

Yet, Exxon is worried enough about potential regulation of hydraulic fracturing that it wrote into the companies’ $41 billion merger agreement that if Congress makes “hydraulic fracturing or similar processes … illegal or commercially impracticable,” the deal is off.

That raised a red flag for some members of the House Energy and Commerce Committee during today's hearing on the energy market implications of the merger.

There is no bill in Congress right now to outlaw hydraulic fracturing, a drilling technique that has opened the way to tapping extensive shale gas reserves. Both Exxon CEO Rex Tillerson and XTO Chairman Bob Simpson acknowledged that they knew of no members of the House, Senate or the Obama administration who were calling for the outlawing of hydraulic fracturing.

The only legislation even addressing hydraulic fracturing right now, two nearly identical bills, one in each chamber, would amend the Safe Water Drinking Act to (1) remove a special exemption for hydraulic fracturing in the definition of “underground injection” and (2) require that drillers disclose to the state the chemicals being used. The actual recipes for those chemical mixes, guarded by their makers, would only be required in an emergency.

“My bill would not make hydraulic fracking illegal,” said Rep. Diana DeGette, the House bill’s sponsor and a Colorado Democrat who stresses that natural gas is a clean domestic energy resource and a big source of jobs in her state.

“I support the use of hydraulic fracking. But I also support it being done in an environmentally responsible way.”

Her concern that companies disclose the chemicals used in hydraulic fracturing followed the federal government's discovery two years ago of unsafe levels of benzene in a rural well near a natural gas field in Wyoming.

Fracking and Fluids

In hydraulic fracturing, or fracking, drillers pump fluid deep underground to fracture rock and capture the trapped inside gas. According to the industry, about 90 percent of wells in operation today have used the technique.

Without fracking, the two energy executives told Congress, gas couldn’t be extracted from the Marcellus, Barnett and other shale formations that have greatly expanded the size of the country’s exploitable natural gas reserves in recent years.

Estimates of the nation's recoverable gas reserves have increased 35 percent in the past two years to a level that can supply natural gas for a century at the current rate of consumption, and that’s when companies are recovering only about 30 to 40 percent of the gas, a number Simpson expects to expand as technology and technique improve.

Tillerson cited the EPA’s own work in arguing that the hydraulic fracturing process XTO uses is safe. A 2004 EPA study concluded hydraulic fracturing “poses little or no threat” to underground drinking water supplies “and does not justify additional study at this time.” A year after that Bush administration report was released, the fracking process — pioneered by Halliburton — was exempted from the Safe Drinking Water Act. The act currently only requires drillers to seek a permit if they use diesel fuel in the process.