Breaking All the Rules: Oil and Gas Enforcement

We have released a national report about state enforcement of oil and gas regulations. The national report examines the current state of oil and gas enforcement in Colorado, New Mexico, New York, Ohio, Pennsylvania and Texas.

This report arose from discussions with oil and gas agency decision-makers, inspectors, members of multi-stakeholder oil and gas organizations, former management-level industry employees, oil and gas and environment attorneys, members of conservation organizations, and representatives of academic institutions – all around the question of what makes enforcement effective.

Based upon the findings of the reports, it seems we face a crisis in the enforcement of rules governing the oil and gas industry:

  • Every year close to 350,000 active wells in these six states are operating with no inspections.
  • When inspections do uncover rule violations, the violations often are not recorded.
  • When violations are recorded, they result in few penalties.
  • When penalties are assessed, they are too small to provide incentive for companies to follow the rules.

In short, states are unprepared to oversee current levels of extraction, let alone increased drilling activity associated with the shale boom.

Oil and gas regulations are the law of the land and oil and gas extraction is allowed assuming that operators will comply with the law. Until states can demonstrate that the law is being followed, it is difficult to maintain the public’s trust. This lack of effective enforcement undermines the claim that states can, and are, protecting the public from the impacts of the shale boom.