Raleigh, N.C. — The Senate Commerce Committee is expected to vote Thursday on a proposal to roll back some of the safeguards in the state's natural gas drilling law.
The measure, Senate Bill 76, had its first hearing in the committee Tuesday morning.
"This country needs the energy, and North Carolina needs the jobs," sponsor Sen. Buck Newton, R-Nash, told the committee. "This bill is an effort to make sure that the industry understands that North Carolina is ready to do business – that we're moving forward, we want them here, we want their investment and we want them to create jobs."
The bill makes many changes to Senate Bill 820, the 2012 law opening the state to gas drilling. Most notably, it removes the requirement that state lawmakers must approve rules before the first well can be drilled.
Instead, it gives the Department of Environment and Natural Resources the authority to start issuing permits on March 1, 2015, without the legislature's say-so.
Supporters of the measure say setting a date will give the oil and gas industry "certainty" that drilling in North Carolina won't face the same delays it's seeing in New York.
"The industry spent millions on exploration there," Newton said. "Now, they have a never-ending moratorium in New York. Our understanding is they're not going to do that again."
Sen. Bob Rucho, R-Mecklenburg, said the date will give DENR plenty of time to finish its work on rules, which are due by Oct. 1, 2014, while sending a signal to oil and gas drillers that "North Carolina wants to be next in the process, rather than sometime way in the future."
Other changes in the bill include removing the state geologist and water and air experts from the state Mining and Energy Commission, allowing drillers to inject production waste fluids back into the ground and changing the Energy Policy Council to the "Energy Jobs Council," which involves firing and replacing everyone currently serving on that commission.
It also encourages offshore drilling exploration, repeals the law requiring "land men" to register with the state and streamlines the permitting process to a single permit, removing checkpoints at which DENR could look for problems.
Sen. Angela Bryant, D-Nash, questioned the wisdom of giving DENR the power to open up gas drilling without legislative OK. "The agency seems to be moving away from science," she said.
Newton bristled at that suggestion.
"What we want to see in DENR – what I want to see in DENR – is an attitude of customer service, to decide how we're going to solve problems instead of just saying, 'No, you can't do this,'" he responded.
Environmental advocates say the measure is a "rush to frack" that guts many of the carefully negotiated safeguards in current law. "Fracking" is the industry term for hydraulic fracturing, a drilling process in which a high-pressure mix of water, chemicals and sand is pumped into a horizontal well to break apart underground shale deposits and free trapped natural gas.
“The Senate Commerce Committee seems poised to renege on promises it made to North Carolina just eight months ago,” said Sierra Club state director Molly Diggins.
“We agree with bill proponents that the gas industry need a degree of certainty to plan its move into North Carolina, but it is the residents of this state who need certainty that their air, water and property are protected,” Diggins said. “It’s one thing to send a message that North Carolina is open for business. It is yet another to spur oil and gas development by removing protections for the public.”
Elizabeth Ouzts with Environment North Carolina told the committee that relaxing the regulation of fracking wastewater would put the state's water supply at risk.
Dan Crawford with the North Carolina League of Conservation agreed, calling the bill "a slap in the face" after last year's legislation.
"Please think about the process and slow down and make sure we get it right," Crawford said. "One ground well, one water source contaminated is one too many."
But Bill Witherspoon with the North Carolina Petroleum Council derided those concerns.
"My friends in the environmental opposition have perfected the strategy of delay," he told the committee. "Their energy strategy is no, and their tactic is delay."
Witherspoon praised lawmakers for moving forward on fracking and for making his industry "feel included."
"This can be done safely if there are safeguards in place on Day One," he said. "I don't think a state could move slower or more carefully and more responsibly than North Carolina has moved."
The bill has not been referred to Senate Ag/Environment, so its next stop after Thursday's scheduled committee vote will likely be the Senate floor.