The Trillion-Gallon Loophole: Lax Rules for Drillers that Inject Pollutants Into the Earth
This story originally appeared at ProPublica.
On a cold, overcast afternoon in January 2003, two tanker trucks backed up to an injection well site in a pasture outside Rosharon, Texas. There, under a steel shed, they began to unload thousands of gallons of wastewater for burial deep beneath the earth.
The waste -- the byproduct of oil and gas drilling -- was described in regulatory documents as a benign mixture of salt and water. But as the liquid rushed from the trucks, it released a billowing vapor of far more volatile materials, including benzene and other flammable hydrocarbons.
The truck engines, left to idle by their drivers, sucked the fumes from the air, revving into a high-pitched whine. Before anyone could react, one of the trucks backfired, releasing a spark that ignited the invisible cloud.
Fifteen-foot-high flames enveloped the steel shed and tankers. Two workers died, and four were rushed to the hospital with burns over much of their bodies. A third worker died six weeks later.
What happened that day at Rosharon was the result of a significant breakdown in the nation’s efforts to regulate the handling of toxic waste, a ProPublica investigation shows.
The site at Rosharon is what is known as a "Class 2" well. Such wells are subject to looser rules and less scrutiny than others designed for hazardous materials. Had the chemicals the workers were disposing of that day come from a factory or a refinery, it would have been illegal to pour them into that well. But regulatory concessions won by the energy industry over the last three decades made it legal to dump similar substances into the Rosharon site -- as long as they came from drilling.
Injection wells have proliferated over the last 60 years, in large part because they are the cheapest, most expedient way to manage hundreds of billions of gallons of industrial waste generated in the U.S. each year. Yet the dangers of injection are well known: In accidents dating back to the 1960s, toxic materials have bubbled up to the surface or escaped, contaminating aquifers that store supplies of drinking water.
There are now more than 150,000 Class 2 wells in 33 states, into which oil and gas drillers have injected at least 10 trillion gallons of fluid. The numbers have increased rapidly in recent years, driven by expanding use of hydraulic fracturing to reach previously inaccessible resources.
ProPublica analyzed records summarizing more than 220,000 well inspections conducted between late 2007 and late 2010, including more than 194,000 for Class 2 wells. We also reviewed federal audits of state oversight programs, interviewed dozens of experts and explored court documents, case files, and the evolution of underground disposal law over the past 30 years.
Our examination shows that, amid growing use of Class 2 wells, fundamental safeguards are sometimes being ignored or circumvented. State and federal regulators often do little to confirm what pollutants go into wells for drilling waste. They rely heavily on an honor system in which companies are supposed to report what they are pumping into the earth, whether their wells are structurally sound, and whether they have violated any rules.
More than 1,000 times in the three-year period examined, operators pumped waste into Class 2 wells at pressure levels they knew could fracture rock and lead to leaks. In at least 140 cases, companies injected waste illegally or without a permit.
In several instances, records show, operators did not meet requirements to identify old or abandoned wells near injection sites until waste flooded back up to the surface, or found ways to cheat on tests meant to make sure wells aren’t leaking.
"The program is basically a paper tiger," said Mario Salazar, a former senior technical advisor to the Environmental Protection Agency who worked with its injection regulation program for 25 years. While wells that handle hazardous waste from other industries have been held to increasingly tough standards, Salazar said, Class 2 wells remain a gaping hole in the system. "There are not enough people to look at how these wells are drilled … to witness whether what they tell you they will do is in fact what they are doing."
Thanks in part to legislative measures and rulemaking dating back to the late 1970s, material from oil and gas drilling is defined as nonhazardous, no matter what it contains. Oversight of Class 2 wells is often relegated to overstretched, understaffed state oil and gas agencies, which have to balance encouraging energy production with protecting the environment. In some areas, funding for enforcement has dropped even as drilling activity has surged, leading to more wells and more waste overseen by fewer inspectors.
"Class 2 wells constitute a serious problem," said John Apps, a leading geoscientist and injection expert who works with the U.S. Department of Energy’s Lawrence Berkeley National Laboratory. "The risk to water? I think it’s high, partially because of the enormous number of these wells and the fact that they are not regulated with the same degree of conscientiousness."
In response to questions about the adequacy of oversight, the EPA, which holds primary regulatory authority over injection wells, reissued a statement it supplied to ProPublica for an earlier article in June.
"Underground injection has been and continues to be a viable technique for subsurface storage and disposal of fluids when properly done," a spokesperson wrote. "EPA recognizes that more can be done to enhance drinking water safeguards and, along with states and tribes, will work to improve the efficiency of the underground injection control program."
Some at the EPA and at the Department of Justice, which prosecutes environmental crimes, say the system’s blind spots suggest that many more violations likely go undiscovered -- at least until they mushroom into a crisis.
That’s what happened at Rosharon.
The accident prompted the EPA to examine what else had been dumped at the site, ultimately exposing a scheme by a company that was not involved in the explosion, Texas Oil and Gathering, to pass off deadly chemicals from a petroleum refining plant as saltwater from drilling.
The switch saved the company substantial fees by allowing it to dispose of the material in a Class 2 well, instead of a more stringently controlled well for hazardous waste, federal investigators said.
Texas Oil and Gathering’s owner and operations manager were convicted of conspiring to dump illegal waste and violating the Safe Drinking Water Act. Both declined to comment for this article.
Texas officials acknowledged that they had not looked beyond the paperwork submitted by the operators using the well. The delivery trucks weren’t inspected; the wastewater was not sampled.
"Staff had no reason to believe at the time that such testing was necessary at this facility," Ramona Nye, a spokeswoman for the Railroad Commission of Texas, which regulates the oil and gas industry activity in the state, wrote in an email. "The likelihood of unpermitted material being disposed of is low."
William Miller, the EPA’s chief investigator on the case, points out that the only reason anyone was held accountable for injection-related violations was because the site blew up.
"If you can get the stuff down the well how is anyone ever going to know what it was?" said Miller, who retired from the EPA in 2011. "There is no way to recover it. It’s an easy way to commit a crime and not have any evidence left of it afterwards."
States and Industry Resist Environmental Protections
One reason that Texas Oil and Gathering was able to dump toxic waste for years without getting caught is that environmental regulations governing how the oil and gas industry disposes of material underground were weakened almost as soon as they were written.
A series of injection accidents beginning in the 1960s -- involving pesticide waste in Colorado, dioxins in Beaumont, Texas, and drilling waste that spread for miles through a drinking water aquifer in Arkansas -- prompted lawmakers to impose tougher rules on injection wells.
Wells were divided into classes, depending on the source of the waste they handled. Class 1 wells for chemical, pharmaceutical and other industrial wastes, along with Class 2 wells for the oil and gas industry, were subjected to tough controls under the Safe Drinking Water Act of 1974. From the start, the EPA says, oil and gas waste was treated as less toxic than waste from other industries, but all such material was seen as dangerous to drinking water.
Companies drilling the wells were required to do geological modeling to ensure that surrounding rock layers would not allow waste to escape through fissures or fault lines. They also were required to check for the presence of other wells that could be a conduit for contamination. The EPA set baseline standards and mandated periodic inspections for defects. In many cases, states oversaw their implementation.
The ink had barely dried on the new regulations when the oil and gas industry -- aided by sympathetic state regulators who thought their existing oversight was sufficient -- began arguing that its waste should be treated differently.
Industry officials lobbied for state oil and gas agencies, some of which already had rules in place, to oversee Class 2 wells, not federal or local environmental officials. Some argued state energy regulators had greater expertise in well construction and regional geology.
In 1980, California Rep. Henry Waxman sponsored a measure that allowed the EPA to delegate authority to oversee Class 2 injection to state oil and gas regulators, even if the rules they applied varied from the Safe Drinking Water Act and federal guidelines.
A few years later, Dick Stamets, New Mexico’s chief oil and gas regulator at the time, told a crowd of state regulators and industry representatives that the Waxman amendment was a biblical deliverance from oppressive federal oversight for the drilling industry.
"The Pharaoh EPA did propose regulations and there was chaos upon the earth," Stamets said. "The people groaned and labored, and great was their suffering until Moses Section 1425 (the Waxman amendment) did lead them to the Promised Land."
In the late 1980s, the EPA moved to impose more stringent measures on injection wells after Congress banned injection of "hazardous" waste. The new rules barred underground dumping unless companies could prove the chemicals weren’t a health threat. To earn permission to inject the waste, companies would have to conduct exhaustive scientific reviews to dispose of hazardous materials, proving their waste wouldn’t migrate underground for at least 10,000 years.