Shareholders Demand Fracking Risk Disclosure

Source: Environmental Leader  (1/24/11)

"Resolutions also request companies recycle, reduce toxic chemicals, and ensure the integrity of well cementing."


Investors have filed shareholder resolutions urging nine major oil and gas companies to disclose risks of their U.S. natural gas fracturing, or fracking, operations. The proposals ask companies to disclose their policies for reducing environmental and financial risks from the use of chemicals, water impacts and other environmental issues associated with fracking. The resolutions also request that companies start recycling and reusing waste waters, reduce the volume and toxicity of chemicals, and ensure the integrity of well cementing by using pressure testing and other methods.

"Oil and gas firms are being too vague about how they will manage the environmental challenges resulting from fracking," said comptroller Thomas DiNapoli. "The risks associated with unconventional shale gas extraction have the potential to negatively impact shareholder value."

The resolutions are being coordinated by the Investor Environmental Health Network and Green Century Capital Management.

Hydraulic fracturing uses water, particles and chemicals injected underground at high pressure to break up shale and release natural gas. The resolution sponsors say oil and gas companies are increasingly turning to the method as conventional natural gas supplies have dwindled.

Poor well construction can lead to drinking water contamination, well blowouts and gas leaks, the sponsors said.

Last autumn, just days after the U.S. Environmental Protection Agency (EPA) issued a subpoena to Halliburton to force the company to share information about its hydraulic fracturing process, Halliburton announced the launch of a new microsite that discloses the materials content of its hydraulic fracturing fluids.

In November Wyoming implemented new rules requiring natural gas drillers to disclose chemicals used in fracking, but citizen groups said the rules fall short of full transparency.