The Trillion-Gallon Loophole 

Drillers that inject pollutants into the earth face lax rules.

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But understaffing seems to be endemic across drilling states, especially where state regulatory agencies are responsible for checking both producing oil and gas wells and injection wells for waste or to enhance production.

In Montana, EPA auditors noted that inspectors are choosing which wells to inspect and have a “significant” workload. In North Dakota, EPA auditors also noted the pressures of “exponential” growth and an “increasing workload.” To meet the goal of inspecting each well annually, Texas inspectors would have to visit eight wells a day, every day, including Sundays and Christmas. That’s after Texas’ Railroad Commission hired 65 staffers last year to help inspect the state’s 428,000 wells.

Nye, the commission’s spokeswoman, said the state had sufficient funding and inspected each of its commercial disposal wells twice last year.

“The Commission has a stringent and comprehensive review process for these wells,” Nye wrote in an email. “Railroad Commission staff work diligently to ensure saltwater disposal wells are not and will not be a problem.”

But inspectors don’t check on private disposal wells, which are far more numerous, with the same regularity. Nor do they keep a schedule for when officials should conduct such visits. Other states are struggling under similar burdens. In Wyoming, inspectors would also have to check eight wells a day for each well to be checked once a year – a pace possible if wells are clustered together, experts said, but otherwise difficult to achieve. In West Virginia and Kansas, inspectors would have to check seven wells per day.

Visiting injection wells often ranks low among inspectors’ priorities unless there is an accident or spill, according to a 2007 Texas auditor’s report. The most urgent responsibility for regulators, beyond responding to emergencies, is typically overseeing the development of new oil and gas wells.

The result is that several years can pass between inspections of many injection well sites. In 2010, state regulators visited less than half of the Class 2 sites that a federal well inventory shows they were responsible for monitoring, ProPublica’s analysis showed. EPA inspectors checked on such wells even less frequently, visiting less than one-quarter of the sites under their jurisdiction in 2010.

“I don’t give a darn whether you have federal regulations, or a squeaky clean permitting system,” said Bill Bryson, a member of the Kansas Geological Survey and the former head of Kansas’ oil and gas commission. “If you don’t have somebody going out and looking at the wells it doesn’t do any good, and if you don’t have the right people looking … it doesn’t do any good either.”

Much of the problem with oversight comes down to money, critics say. In some states, budgets and staff for oil and gas agencies have dropped relative to the number of new wells being drilled over the last nine years.

Kansas employs about the same number of inspectors as it did in 2003, even though it drills four times as many new wells. New drilling has nearly doubled in Louisiana over the same period, but the state’s enforcement staff has remained static and its oil and gas budget has increased modestly. In Illinois, drilling has nearly doubled, while the number of enforcement staff has been reduced.

Since the Underground Injection Control program is run under a federal mandate, states rely partly on money from the EPA to fund oversight and enforcement. Federal dollars make up 20 percent of Texas’ budget, for example. But in the last 22 years, the EPA’s annual operating budget for injection has remained about the same: $10 million. Taking inflation into account, funding has dropped at least 40 percent from 1990 to 2012, though the regulations for all well classes have only grown more complex.

“The UIC program has been flat funded for years,” said Dan Jarvis, the field operations manager for Utah’s Division of Oil, Gas and Mining. “With more manpower, obviously you put them on the ground and you’re going to have better compliance. Our field people are some of the greatest guys going, but they are overworked.”

The EPA declined to disclose the operating budget for regional offices that monitor waste wells under federal jurisdiction or oversee state injection programs. Documents show, however, that in 2011 the agency suspended its travel budget for visits to some of the states that have the largest injection programs, including Louisiana, Texas, and Oklahoma.

“Do you think we are doing more now than we were doing 30 years ago? No, there is no money,” said Salazar, the former EPA injection expert. “There are not enough people to know what is going on. It is the ideal storm for industry. Less and less people, more and more things that the EPA has to do.”

Ultimately, much of the responsibility for meeting EPA standards falls to companies themselves. Some operators routinely exceed the minimum requirements of injection regulations, says Hughbert Collier, who runs a Texas environmental engineering firm that consults with injection well operators. They conduct their own integrity tests every year and make sure employees visit well sites once a month.

But operators inclined to cut corners have little to hold them back. “What most people would be surprised about is that regulators don’t have real good control over everything that goes on in the regulated community,” said Miller, the former EPA criminal investigator in Texas. “Most of our environmental law requires self-reporting and that requires honest people.”

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