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New Jersey Lawmakers Send Christie Ban on Hydraulic Fracturing

The New Jersey Legislature sent Republican Governor Chris Christie a measure to ban drilling for natural gas using a process called hydraulic fracturing, which environmental groups say contaminates drinking water.

The measure passed the state Senate 32-1 and the Assembly 56-11 with 8 abstentions yesterday, according to the New Jersey Office of Legislative Services website. If Christie signs the bill, it will be the first statewide ban on fracking in the U.S. The governor won’t comment until state lawyers review the legislation, Michael Drewniak, his spokesman, said yesterday in an e-mail.

While New Jersey produces no natural gas, communities in the state’s northwest sits atop the Utica Shale, a largely unexplored formation stretching from Ontario, Canada, to Tennessee. Range Resources Corp. (RRC) said in February that its initial well in the Utica formation in Pennsylvania produced the equivalent of 4.4 million cubic feet of natural gas a day.

“We want to get this in place so that New Jersey will be off-limits,” Assemblywoman Connie Wagner, a Democrat from Paramus and a sponsor of the measure, said in an interview. “There are regulations in place and it’s not working. We are seeing one accident after another.”

U.S. gas output expanded 20 percent in the past five years as the process let drillers extract the fuel from shale formations in Texas, Louisiana, Arkansas and Pennsylvania once considered impenetrable. The U.S. Environmental Protection Agency is studying fracking, in which millions of gallons of chemicals are injected underground, for possible impacts on drinking water. The EPA said results are expected in 2014.

Chesapeake Leases

Chesapeake Energy Corp. (CHK) is among gas producers that have been leasing property to drill in the Utica formation since December, said Diana Marchese, the county recorder in Trumbull County, Ohio, which borders Pennsylvania. Marchese’s office keeps records of leases filed.

New York’s legislature passed a fracking ban in 2010 that was vetoed by former Governor David Paterson. Paterson, a Democrat, later imposed a temporary moratorium.

France’s National Assembly voted last month to punish drillers who use the technique with fines, jail time and cancellation of exploration permits. A Senate vote is scheduled today in Paris.

Bob Martin, commissioner of the New Jersey Department of Environmental Protection, has sought strict regulations on drilling near the Delaware River, part of a watershed that supplies water to 15 million people in New York, Pennsylvania, New Jersey and Delaware. The Delaware River Basin Commission, which manages the watershed, has put gas development on hold while it drafts rules.

Delaware Water Quality

“We will insist that natural gas regulations” adopted by the commission “guarantee the supply and quality of the Delaware River water, on which New Jersey relies for up to one- quarter of our drinking water,” Martin told the commission in April.

In Pennsylvania, 2,864 wells have been drilled in the Marcellus Shale since 2008. Marcellus, which sits above the Utica formation and stretches from New York to Maryland, may hold 490 trillion cubic feet of gas, enough to heat U.S. homes and power electric plants for two decades, according to Terry Engelder, a professor of geosciences at Pennsylvania State University in State College.

The N.J. legislation describes fracking as involving chemicals “that can suddenly and in an uncontrolled manner be introduced into the surface waters and ground water of the State.” The measure refers to a June 10, 2010, spill in Clearfield County, Pennsylvania, about 110 miles (177 kilometers) northeast of Pittsburgh, in which gas and drilling fluid shot “75 feet into the air for 16 hours,’ according to Boston-based Environment America.

Leroy Well Leak

On April 19, a Chesapeake crew was fracturing a well near Leroy Township, about 150 miles northwest of Philadelphia, that erupted because of equipment failure, according to a statement by Oklahoma City-based Chesapeake. Fluids spilled fluids into a tributary of Towanda Creek, which flows to the Susquehanna. No injuries were reported. Seven families were evacuated as a precaution and all returned within a day, Chesapeake said.

Hydraulic fracturing ‘‘poses serious potential for harm to our environment and our health,’’ according to the Environment America’s website.

‘‘From what we have seen with our neighboring states, we have seen them embrace the system for fracking and what we have seen is the regulations are not in place to control the damages,’’ Wagner said. ‘‘Specifically, Pennsylvania.’’

U.S. shale-gas production reached 4.87 trillion cubic feet in 2010, or 23 percent of total gas production, up from 0.39 trillion cubic feet in 2000, the Energy Department said in an April 5 study. Rising production of shale gas has helped lower natural gas prices and reduce imports, the study said.

To contact the reporter on this story: Jim Efstathiou Jr. in New York at jefstathiou@bloomberg.net

To contact the editor responsible for this story: Larry Liebert at lliebert@bloomberg.net

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