'Halliburton Loophole' a Weapon of Mass Devastation
Across the United States the exploitation of gas and oil from shale rocks using Halliburton’s hydraulic fracturing technology continues amid rising disasters. Unregulated drilling practices, rendered legal by the “Halliburton Loophole” engineered in 2005 by Vice President Dick Cheney, have had staggering health and environmental effects. Lured by the prospect of reducing oil dependence, President Obama has adopted an ambivalent approach that ultimately yields ground to industry.
In March 2015, the Obama administration announced new rules to regulate fracking on federal lands. They are less stringent than some states already require. In many others, however, regulations are weak and enforcement is notoriously lax.
Myth and Reality:The Halliburton Loophole
Fracking techniques have been around since the end of World War II. Why then suddenly is the world going gaga over shale gas hydraulic fracking?
One reason for the fracking boom is the advance of various horizontal underground drilling techniques. Another is the record high oil and gas prices in the years between 2000 and 2008, which made the costly extraction process profitable. During that period, increased demand in emerging markets and production cuts by OPEC combined to drive the price from less than $25 per barrel of oil to almost $150.
But by the end of 2008, a global recession drove the prices down to $40. The economic recovery sent the price back up to over $100, and then, in 2014, prices again plummeted. At this writing, the price of a barrel oil is $35.
Saudi Arabia, which holds the world’s largest oil reserves, kept its production stable so as not to surrender market share. Because its production costs are so much lower compared to the cost of the fracking process, the Saudis are positioned to ride out low oil prices for a long time without putting too much of a dent in their economy. And by keeping prices low, the Saudis are betting that U.S. oil and gas companies will give up fracking due to its lack of profitability. While fracking activity has slackened somewhat in response, most experts are confident that prices will rise again and that the frackers are here to stay — unless ordinary citizens can do something about them.
But the most important reason is the passage of congressional legislation in 2005 that exempts fracking from regulatory supervision by the U.S. Environmental Protection Agency (EPA) under the Safe Drinking Water Act. The oil and gas industry is the only industry in America that is allowed by EPA to inject staggering volumes of water mixed with some of the most toxic chemicals known in areas adjacent to underground drinking water supplies. The industry also successfully lobbied for exemptions from key provisions of the Clean Water Act, the Clean Air Act, the Superfund Act and others.
The 2005 law is known as the “Halliburton Loophole.” That’s because it was introduced on massive lobbying pressure from the company that produces the lion’s share of chemical hydraulic fracking fluids — Dick Cheney’s old company, Halliburton. When he became vice president under George W. Bush in early 2001, Cheney immediately headed up a major energy task force to develop a comprehensive national energy strategy. Cheney’s political muscle and the industry’s lobbying money pushed through Congress the regulatory exemption that we’re still living with.
In 2004 the EPA issued a study of the environmental effects of fracking. That study has been called “scientifically unsound” by EPA whistleblower Weston Wilson. In March 2005, EPA Inspector General Nikki Tinsley found enough evidence of potential mishandling of the EPA hydraulic fracturing study to justify a review of Wilson’s complaints. The Oil and Gas Accountability Project conducted a review of the EPA study that found that EPA removed information from earlier drafts that suggested unregulated fracturing poses a threat to human health, and that the agency did not include information that suggests “fracturing fluids may pose a threat to drinking water long after drilling operations are completed.”
Attempts by citizen organizations and individual litigants to force oil services company disclosure of the composition of chemicals used in hydraulic fracking have been met with the argument that the chemicals are proprietary secrets and that disclosing them would hurt competitiveness. But the frackers tell us not to worry: The process is safe, it’s good for “our” economy, but we won’t tell you more than we have to, which is as little as possible, and you can’t regulate us.
Wastes Are a Toxic Nightmare
In a typical shale gas fracturing operation, a company drills a hole several thousand meters below the surface of the earth; then they drill a horizontal branch perhaps one kilometer in length. As one expert described it, once the horizontal drilling into the shale formation is done, “you send down a kind of subterranean pipe bomb, a small package of ball-bearing-like shrapnel and light explosives. The package is detonated, and the shrapnel pierces the bore hole, opening up small perforations in the pipe. They then pump up to 7 million gallons of a substance known as slick water to fracture the shale and release the gas. It blasts through those perforations in the pipe into the shale at such force — more than 9,000 pounds of pressure per square inch — that it shatters the shale for a few yards on either side of the pipe, allowing the gas embedded in it to rise under its own pressure and escape.”
The shale rock in which the gas is trapped is so tight that it has to be broken in order for the gas to escape. Therein come the problems. A combination of sand and water laced with chemicals is pumped into the well bore at high pressure, shattering the rock and opening millions of tiny fissures, enabling the shale gas to seep into the pipeline.
Not only does it liberate gas — or in the case of the Bakken Shale in North Dakota and Montana, oil — but it also floods the shale formation with millions of gallons of toxic fluids. A study conducted by Theo Colborn, PhD, director of the Endocrine Disruption Exchange in Paonia, Colorado, identified 65 chemicals that are probable components of the fracking fluids used by shale gas drillers. These chemicals included benzene, glycol-ethers, toluene, 2-(2-methoxyethoxy) ethanol and nonylphenols. All of those chemicals have been linked to health disorders when human exposure is too high. Click here to see the late Dr. Colborn’s congressional testimony on the subject.
This article has drawn on several sources. However, the main ideas — though we have made some editorial revisions — are those of F. William Engdahl. His original essay can be read online at voltairenet.org/article174176