Texas Law Requiring Mandatory Disclosure Becomes Effective Very Soon

Texas law requiring public disclosure of fluids used in hydraulic fracturing takes effect for all wells where an initial drilling permit is issued by the Texas Railroad Commission on or after February 1, 2012.

Therefore, while many companies have already been making these disclosures voluntarily, the mandatory reporting requirements will come in to play very soon.  (Hypothetically, if a well received its initial drilling permit on the first day, Feb. 1, 2012 and also hypothetically was drilled and had hydraulic fracturing performed that same day, then there could be some reporting requirements as early as Feb. 15th).  

The regulations require public disclosure of chemicals used for fracturing that are either regulated by OSHA or are otherwise intentionally added, along with the actual or maximum concentrations of each.   The regulations specifically exempt from disclosure chemicals unintentionally added, chemicals that occur naturally, or chemicals not disclosed by the manufacturer, supplier, or service company.   Companies can also claim trade secret exemptions, which must be approved by the Texas Railroad Commission.

The rules also require certain disclosures by “service companies” to the operator.

In addition to chemical disclosures, operators must disclose the total volume of water used and the total volume of base fluid used.

In addition to the foregoing, local municipalities have also proposed hydraulic fracturing regulations.  In August 2011, the North Texas city of Grand Prairie in the Barnett Shale became the first municipality in Texas to ban the use of city water for fracturing.

One month earlier, water officials for the Ogallala Aquifer in part of the Permian Basin included fracturing activities in the district’s first-ever water use restrictions.  And, in the Lubbock-based High Plains Underground Water Conservation District No.1, new water restrictions aimed at fracturing go into effect in 2012.  Other Texas municipalities are considering similar measures.