Bill sets tough liability rules for fracking
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By: Bryan P. Sears Daily Record Business Writer February 11, 2015
ANNAPOLIS — Companies looking to drill for natural gas could face stricter liability standards under a bill introduced in the Maryland Senate.
Senate Bill 458 seeks to establish what Sen. Robert A. “Bobby” Zirkin, D-Baltimore County and sponsor of the bill, and drilling advocates say is arguably one of the toughest liability standards for hydraulic fracturing, commonly called fracking, in the country.
“We should ban fracking but in the absence of that this sets up a reasonable standard where there are consequences for the company if something goes wrong,” said Zirkin.
Industry advocates say Zirkin is using the liability standard to prevent natural gas drilling in Washington and Allegany Counties where there are Marcellus Shale deposits.
“This would be the strictest liability bill of anywhere in the country regarding hydraulic fracturing,” said Drew Cobbs, executive director of the Maryland Petroleum Council. “The intent is, in essence, to stop or essentially ban this in Maryland.”
Senate Bill 468 would set a rebuttable presumption standard that requires drilling companies to prove that the drilling or the chemicals used in the process were not responsible for the alleged personal injuries, death or damage to the environment or property. The companies would also be required to carry liability insurance on each well for a period of 21 years
In the event of a lawsuit, the bill would allow plaintiffs to seek information related to the chemicals used in the fracking process. Drilling companies could not challenge the discovery request by claiming the information is a trade secret, a commonly accepted defense in other states.
The bill also would prohibit the drilling companies from using defenses that they were acting in accordance with industry standards, state or federal law, or complying with conditions of a permit issued by a state or federal agency.
Zirkin said he based his measure on a similar measure that was proposed in New York.
“I tried to think of all the ways drilling companies have escaped when they’ve done something that hurts someone or the environment and then I tried to short-circuit them,” Zirkin said.
In 2012, the legislature passed a presumptive liability law that defined impact areas if drilling were to occur as well as establishing regulations for testing and, if necessary, remediating contaminated areas. Drilling companies remained liable for a year after drilling at a well ceased. The bill was the result of early recommendations made by a commission tasked with studying the issue in the state.
“That law deals directly with any impacts when they are happening and not forever as is in this bill,” Cobbs said.
Since then, a number of bills have been introduced to either ban or establish a long-term moratorium. Zirkin sponsored a bill to ban fracking in Maryland. That bill died in the Senate Education, Health and Environmental Affairs Committee.
Cobbs, the industry advocate, said Zirkin is attempting to ban fracking in Maryland and do it by pushing the bill through the Senate Judicial Proceedings Committee rather than the committee chaired by Sen. Joan Carter Conway, D-Baltimore City. Carter Conway has been a staunch opponent of ban bills proposed over the last few years.
“This is just a new way to get at (a ban) and it puts it in his committee,” Cobbs said.
Karla Raettig, executive director of the Maryland League of Conservation Voters, said she believes the bill establishes a tougher liability standard and is not a moratorium bill “but to the extent that companies can’t frack, that sends a pretty strong message.”
The organization has not taken a formal position on Zirkin’s bill. Raettig said her group favors a long-term moratorium of at least five years to allow for additional health studies.
Zirkin said he hopes his bill becomes a national model and said he’d be comfortable if the standard is so strict that no company would want to drill in Maryland.
“This is purely a liability bill so that if the state or its residents are harmed, we have an environment where companies are held responsible for damages done and don’t kid yourself, there will damages done.”