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Federal Government Has Head in the Sand on Fracking and the NPRI

Webster’s Dictionary defines the ostrich as a bird that when pursued hides its head in the sand and believes itself to be unseen. The behaviour, according to Webster’s, is analogous to attempting to avoid difficulty by refusing to face it.

A recent decision of Environment Canada illustrates that this behaviour is not limited to the ostrich. In 2012, the federal environment commissioner reported that since 2010 several petitions had been received in which petitioners expressed concerns about the toxicity of chemicals used in hydraulic fracturing, also known as fracking, and the lack of public disclosure about chemicals used in that process. Fracking is the use of very high pressure to inject large volumes of fluid containing chemicals and other agents, such as sand, into rock formations to fracture rock and release trapped oil and gas. In response to one of these petitions, the Minister of the Environment indicated that Environment Canada was exploring options to gain a better understanding of substances contained in hydraulic fracturing fluid and that it was already reviewing reporting requirements for the oil and gas sector pursuant to the National Pollutant Release Inventory (NPRI) under the Canadian Environmental Protection Act, 1999 (CEPA, 1999). The purpose of the review was to consider changes to the NPRI that would capture more information on oil and gas activities.

The Minister has discretion regarding industry NPRI reporting requirements and currently exempts oil and gas exploration and drilling activities from such reporting. According to Environment Canada, as reported by the commissioner, in order to consider whether changes to NPRI reporting requirements are warranted, the department needs to know specifically what substances are used for hydraulic fracturing as well as their volumes and concentrations. Environment Canada and Health Canada advised the commissioner that while a partial list of substances that are likely to be used in hydraulic fracturing has been developed, a complete list of substances used in Canada is not known. According to the commissioner, both departments consider hydraulic fracturing to be an emerging global issue that they are beginning to investigate and expected to complete their review and determine what changes are warranted by the end of the first quarter 2014.

However, in January 2014 Environment Canada reported that what it proposed doing was to: (1) make no changes to the NPRI reporting criteria specific to hydraulic fracturing activities; and (2) continue assessing new information as it becomes available to determine if additional reporting may be appropriate in the future. The Department noted that among the issues it considered before making this determination was that well drilling and hydraulic fracturing activities usually occur only once or a few times during the life of a well. If hydraulic fracturing activities were required to be reported to the NPRI, the facilities would generally report to the NPRI on an ongoing basis but only for those years in which fracturing occurred. According to Environment Canada, the time-limited nature of these activities makes them difficult to capture though an annual, facility-based reporting program like the NPRI. An additional consideration, according to the Department, is that the identity of the substances used in hydraulic fracturing fluid may be considered proprietary information. Sections 51-53 of CEPA, 1999 provide criteria for Environment Canada to determine whether to accept or reject requests to treat information reported under the NPRI as confidential.

The two grounds proffered by Environment Canada to justify not addressing hydraulic fracturing chemicals are somewhat surprising. First, it is hardly an insurmountable obstacle for a company to report every year under the NPRI program even if in some years the quantum of chemicals reported is zero. Second, virtually every chemical now regulated under the Act regardless of industrial sector activity raises the potential challenge of confidential business information. It is not clear what is different or special about chemicals used in hydraulic fracturing that would justify hesitating to impose reporting requirements on facilities using them. In short, this industry should not be exempt from complying with NPRI reporting requirements.

The time is past due for the federal government to take its head out of the sand on this issue.