By Mike Ludwig, Truthout.org
The Pacific Ocean may be the next frontier for fracking technology.
A Truthout investigation has confirmed that federal regulators approved at least two hydraulic fracturing, or "fracking," operations on oil rigs in the Santa Barbara Channel off the coast of California since 2009 without an updated environmental review that critics say may be required by federal law.
The offshore fracking operations are smaller than the unconventional onshore operations that have sparked nationwide controversy, but environmental advocates are still concerned that regulators and the industry have not properly reviewed the potential impacts of using modern fracking technology in the Pacific outer continental shelf.
Oil drilling remains controversial in Santa Barbara, where the memory of the nation's third-largest oil spill lingers in the minds of the public. In 1969, the nation watched as thick layer of oil spread across the channel and its beaches following a blowout on an oil rig, killing thousands of marine birds other wildlife. The dramatic images helped spark the modern environmental movement and establish landmark federal environmental laws that eco-groups continue to challenge the government to enforce.
In 2012, Truthout reported that an oil company called Venoco had quietly used fracking technology to stimulate oil production in an old well off the coast of Santa Barbara in early 2010. A Freedom of Information Act request recently filed by Truthout has confirmed the Venoco operation and revealed that another firm had since received permission for fracking in the Santa Barbara channel, which is home to the Channel Islands marine reserve.
This year, federal regulators approved an application by the Ventura-based company DCOR LLC to use fracking technology known as "frack pack" in a sandstone well 1,500 feet from a seismic fault in the outer continental shelf off the California coast, according to the documents released by the Bureau of Safety and Environmental Enforcement (BSEE), the federal agency that permits offshore drilling.
Because of the well's proximity to seismic faults, the regulators conducted a "geohazard" review before green-lighting the project. The area is seismically active, and the most recent earthquake felt near Santa Barbara was a 4.8 magnitude tremble May 29 off the coast just north of the city.
DCOR LLC told federal regulators that, if the offshore frack proves successful, the company would pursue more offshore fracking, according to internal BSEE communications. DCOR LLC is California's largest offshore player, operating 11 of the 24 rigs off the state's coast, according to the company's website.
Offshore fracking is rare, but officials expect that other firms also may utilize fracking technology on offshore rigs in the future as oil drilling continues to accelerate in California, according to internal BSEE communications.
Fracking is a method of extraction that involves forcing water, chemicals and sand deep beneath the Earth at high pressure to break up underground rock and release oil and gas. Advances in fracking technology have made domestic oil and gas reserves more accessible, and the industry has expanded across the country, igniting one of the nation's most heated environmental debates.
Unlike modern onshore fracking, which uses horizontal techniques to extract oil and gas from unconventional sources such as the Marcellus Shale, offshore fracking is used to stimulate oil production in old wells and provide well-bore stability, according to a statement made on background by a BSEE spokesman. Offshore fracking typically uses 2 percent of the fluids and 7 percent of the sand typically used in large onshore operations.
Is Offshore Fracking Legal?
In 2011, the Santa Barbara-based Environmental Defense Center reported that Venoco had fracked a well from the Platform Gail oil rig in the Santa Barbara Channel. Little was known about the operation at the time, but the group pointed out that federal regulators allowed the frack under existing permits and no environmental review had been documented.
Truthout later uncovered a 2009 Venoco financial disclosure statement detailing the company's plans to frack from Platform Gail in the Sockeye oil field. According to comments made by Venoco CEO Tim Marquez at the time, advanced fracking techniques would be tested at Sockeye.
"We believe one of the Monterey shale zones producing at Sockeye is highly analogous to areas we’ve targeted with our onshore Monterey shale leasing," Marquez commented in the disclosure statement. "These wells appear to be ideal candidates for fracturing, but modern fracture technology has never been tested on them."
The Bureau of Ocean Energy Management, Regulation and Enforcement (BOEMRE) permitted Venoco's 2010 frack job. The operation was the first offshore frack approved since 2001, according to a "fact sheet" released by BSEE.
Following the BP oil spill in the Gulf of Mexico, BOEMRE split into two agencies: BSEE and the Bureau of Ocean Energy Management (BOEM).
Truthout has confirmed that regulators approved both the Venoco and DCOR LLC frack jobs by signing off on modifications to existing drilling permits. The regulators claim that they review all applications for environmental concerns, but environmentalists say that they did not produce the kind of detailed assessment of the potential impacts that modern fracking technology could have on ocean environments that is required by the federal law.
"It's completely illegal for the agency to approve fracking in the outer continental shelf without conducting a complete environmental impact statement," said Kassie Siegal, a senior counsel at the Center for Biological Diversity, after learning about the offshore fracking.
In a cache of internal emails released to Truthout, BSEE Chief of Staff Thomas Lillie openly wondered how the agency could allow fracking offshore without producing an environmental impact statement (EIS):
In a background statement, a BSEE spokesman said fracking is one of several operations that a driller can propose to use by applying to modify its original drilling permit. To satisfy federal legal requirements, every application is reviewed by regulators for environmental and "geohazard" concerns that were not addressed in previous reviews that were part of the leasing, drilling and exploration processes, including environmental assessments (EA) and EIS.
When Truthout asked BSEE for a copies of the previous federally mandated environmental reviews, however, the spokesman referred the request to BOEM, the agency that keeps records of such reviews of drilling in federal waters. In an email, a BOEM official then told Truthout to file yet another FOIA request to receive copies of the "historical EIS/EA information."
Miyoko Sakashita, the Center for Biological Diversity's ocean specialist, later told Truthout that environmental reviews that form the basis for the original drilling permits likely are too old and outdated to address the potential environmental impacts of deploying modern fracking technology in the outer continental shelf.
Siegal said BSEE would have to be challenged in court to prove that permitting offshore fracking is illegal without updating environmental impact reviews. In April, Siegal and her allies won a lawsuit on similar grounds against the Obama administration's Bureau of Land Management (BLM) when a judge ruled that the bureau could not lease public lands to oil drillers without conducting an environmental review.
Four weeks later, the BLM postponed all lease sales in California for the rest of the fiscal year. The BLM cited budget constraints, but the Center for Biological Diversity points out that lease sales continue in other states.
Siegal said regulators are "absolutely reckless" with fracking permits in California, where an oil rush is gaining steam. Advances in fracking technology have made it easier to extract oil from the Monterey Shale, a massive underground formation that contains about two-thirds of the nation's reserves.
The formation extends under the Pacific Ocean. And if fracking proves successful onshore, top regulators expect that more oil drillers may pursue fracking offshore, according to internal BSEE communications.
What are the Fracking Facts?
DCOR LLC appears to be the only firm currently planning to use fracking techniques off the California coast, but other rig operators told BSEE officials that they could not "rule out hydraulic fracturing in the distant future," according to a "fact sheet" released by BSEE.
It's unclear whether the fact sheet, which was released to Truthout as part of the FOIA request, was drawn up to inform the public or the regulators themselves.
According to the fact sheet, fracking has occurred only 11 times in the Pacific drilling region during the past 25 years. Most of the frack jobs were conducted in the 1990s and were frack packs and "mini-fracs" that did not extend farther than 50 feet from an oil well.
A BSEE spokesman, however, later told Truthout that, to get the full number of fracks performed offshore, BSEE officials would have to comb through every well file and count the number of fracking operations, which could take years because many files are not digitized.
In a draft letter written in January 2012 to a concerned citizen who had inquired about the Venoco offshore frack job, BSEE Director James Watson wrote that fracking had occurred only twice in federal waters off the coast of California and failed to mentioned the 2010 Venoco frack job. He also claimed that BSEE would not approve any offshore fracking operations until "detailed environmental assessments, such as the EPA study of [effects] on drinking water due in 2014, are conducted and effective operating procedures are determined so that they may be enforced to preserve our environment and natural resources."
Within weeks, however, Watson's regulators would approve DCOR LLC's permit modification to perform a frack pack. Meanwhile, the EPA study Watson mentioned continues, and BSEE and BOEM have not made any "detailed environmental assessments" of offshore fracking available publicly. It’s unclear if Watson ever finished the letter and sent it to the concerned citizen.