The First Amendment is under attack. Fight back with us. Visit fight.spj.org to find out how.

Member Login | Join SPJ | Benefits | Rates

> Latest News, Blogs and Events (tap to expand)


Advertise with SPJ
— ADVERTISEMENT —
Advertise with SPJ
1

News and More
Click to Expand Instantly

Journalist's Toolbox

— ADVERTISEMENT —


Stay in Touch
Twitter Storify Facebook Google Plus
RSS Pinterest Pinterest Flickr



Current Issue
Browse Archive
About Quill
Advertising Info
Back Issue Request
Reprint Permission Form
Pulliam/Kilgore Internship Info

Search Quill


Publications
SPJ Blogs
Quill
SPJ Leads
The EIJ News
Press Notes
SPJ News
Open Doors
Geneva Conventions
Annual FOI Reports

Home > Publications > Quill > Frack Attack: Fueling Secrecy


Current Issue | Browse Archive | About Quill | Advertising Info
Back Issues | Reprint Permission Form

Search Quill


Tuesday, October 27, 2015
Frack Attack: Fueling Secrecy

Regulatory agencies, trade secrets and legal loopholes allow oil companies to shroud themselves in 'confidential business information.'

By Ashley Mayrianne Jones

Deep in the grounds of Northeastern Pennsylvania, one of 66 oil and gas operators injects a high-pressure slurry of water and undisclosed chemicals into fractures in the rock, cracking the sediment and allowing oil to flow freely into one of 7,700 collecting wells.

Hydraulic fracturing — fracking — is nothing new. The process began with early experiments in Texas and Oklahoma during the 1950s. However, fracking technology has improved enormously since then, and companies have spread to other locations like the Marcellus Shale in Pennsylvania and New York, the Bakken Shale in North Dakota and other states.

The expansion of fracking brings the need for more news coverage. Potential stories run the gamut: lobbying efforts, air and water pollution, seismic activity, worker safety, technological breakthroughs and insider business deals are all topics of interest. Yet journalists meet strong resistance from oil companies, whose need for self-preservation and competitive advantage drive businesses toward a practice of non-disclosure. The confidentiality carries over into reports filed with federal and local government agencies under loopholes protecting “confidential business information,” making reporting about the industry a trial for journalists.

“Oil is not good or bad, it’s pure capitalism,” said Noah Brenner, Houston bureau chief at Upstream, a trade/business publication. The defense of business is what has led to historical government exemptions for the industry, on the local and federal levels. Oil has special exemptions under seven environmental laws, including the Clean Water and Clean Air Acts, the Safe Water Drinking Act and acts designed to deal with the management of hazardous wastes.

Fracking also comes with its own secrets, specifically locations of exploratory wells and chemical composition of fracking fluids.

For the journalist who can break through the trade secret barrier, the experience is rewarding.

Geological Info/Exploratory Data

Brenner is interested in what’s going on under the ground. As an economic reporter he investigates how wells will be drilled, what new formations are being used, and where the best oil fields are located.

While some geological information is exempt from the Freedom of Information Act under Exemption 9, this isn’t what poses the problem when he is looking for information. In fact, the only time Exemption 9 has been used recently is in relation to water wells, according to Brian May, FOIA officer at the U.S. Geological Survey. The issue is “exploratory data” — provisions that are decided by the states.

Get the Information:

-“When looking for industry sources, go to those who are praised by other companies as industry leaders (e.g. BP). Each company adopts its own business practices, so some will be more likely to make their top executives and public relations people available.” ~ Lise Olsen, Houston Chronicle

-“Trade associations put out data, but it is by nature suspect and in the industry’s best interest. Verify data, question how it was obtained, and use third-party sources whenever possible.” ~ Bobby Magill, Climate Central

Imagine you are CEO of an oil company, and you buy a tract of land, May said. If you drill a well and discover a wealth of oil, you’ll want to keep that information secret — at least until you can buy the adjacent land. Similarly, if no oil is found, you’ll keep quiet, for fear of losing stock value over your failed project.

To protect the industry economically, states allow companies to keep the results of their exploration secret, for as little as 60 days or as long as two years, depending on the state. For example, Alaska keeps exploratory data secret for two years, whereas North Dakota releases data after six months and posts an online list of confidential wells and the expected dates when more information will be released.

“If that data is released, it is releasable to the world forever," May said. “I can’t give someone the information and then turn around and deny someone else that same information. (A journalist) might have insider information but not everyone else does, and that’s what the USGS needs to consider.”

May said that despite this, he sees both the journalists and the oil industry as his customers, and he attempts to find a happy medium between the two when granting FOIA requests.

In North Dakota, revealing geological information such as exploratory data is considered a Class C felony. Even those who own the surface/mineral rights don’t have the right to geological information about a confidential well.

“All the surface owners really need is the oil sales information, to make sure it matches their check,” said Allison Ritter, public relations officer for the Oil and Gas Commission of the North Dakota Department of Mineral Resources. “They don’t need to know about the geological formation, although most probably know it’s the Bakken. Confidentiality is a proprietary thing for competition.”

Brenner doesn’t wait on the exploratory data to tell his stories. Surface well location is always public, and he uses past permits and formation plans to predict where a company will drill its next well. He also predicts well depth based on the depth of adjacent wells that have already received permits and been constructed. At that point, it’s all double-checking with sources for confirmation, he says.

Secret Formulas

One of the main issues with fracking has been the fear of water pollution and threats to human and environmental health when fracking fluids are reinjected into the ground or dumped in a water source. Companies do not have to disclose the chemical composition of their fracking fluids under a “trade secret” exemption, which allows them to protect their proprietary information by listing chemicals by the chemical family or under a generic name rather than the trade name.

Trade secrets can only be disclosed in cases of medical emergency, and even then, a doctor must often promise not to reveal the information. In case of an accident or spill, this information is also kept confidential. And while the chemicals may be no different than those under your kitchen sink, they are still not what you would want in your drinking water, Climate Central reporter Bobby Magill said.

The Environmental Protection Agency was recruited to complete a study in 2012 to evaluate the dangers of fracking fluid. But due to scheduling conflicts and noncompliance from the industry, the EPA was only recently able to release a draft. Published in June, the draft predicted no significant health risks. However, Greenpeace and InsideClimate News recently published emails and documents revealing shortcomings of the study and industry noncompliance. But there may be more information about fracking fluids within the next few years, as more states require disclosure either to the agency or to FracFocus, an online chemical disclosure registry.

FracFocus still protects some information as trade secret, because of problems with companies in China, Brazil and Kuwait copying and back-engineering fracking fluid information, said Bill Sydow, director of the Nebraska Oil and Gas Commission. The commission, along with the Groundwater Protection Council, was one of the organizations that worked together to create FracFocus five years ago, with the intention of providing information to small-town farmers and ranchers. Some states are now requiring companies to disclose the volumes and types of fluid they are using, but there are also problems with accuracy when self-reporting.

Currently, a company must list its well locations and types of chemicals used, but not the actual composition.

“It’s like the recipe for Coca-Cola," Sydow said. “You can find out what the ingredients are in Coca-Cola by reading the label, but not what concentration each occurs in.”

More Advice:

-“Look for handwritten notes in the margins.” Computer programs designed to recognize confidential information can pick up type on a PDF, but not handwriting. This might include interesting comments, corrections and diagrams for a story.” ~ Noah Brenner, Upstream

-“If filing a FOIA request for emails, by default we include attachments and have to go through them line by line, which makes the process take longer. Try requesting just the email chain first, find out what you need, then request the attachments of interest.” ~ Brian May, U.S. Geological Survey

-“Talk to your local oil and gas commission/department and have them walk you through their websites, which have all kinds of information about a well’s location, physical parameters, production amounts and documentation from the initiation to the closing off of a well.” ~Bill Sydow, Nebraska Oil and Gas Commission.



However, he believes the new FracFocus, currently in development, is going to modify the process so the chemicals are disclosed line by line, but without listing their actual use in the “recipe.”

Sydow himself does not understand the “brouhaha” surrounding environmental concerns and the fracking industry. Fluids are typically at least 92 percent freshwater and a small percentage of sand, with no more than 0.5 to 2 percent being additives found in a typical household, he said.

“Everyone has access to these chemicals, and if they knew what they were, they would say, 'I could have done that myself.' But secrecy is a competitive thing, for an industry to be the best and to increase productivity.”

State by State

Transparency in the states varies tremendously, depending in part on how large and influential the oil industry is in the local economy. Nebraska, Colorado and North Dakota boast extensive online resources and datasets. Meanwhile, Pennsylvania and Michigan’s websites have had “down for maintenance” periods lasting months.

Some states are simply not contacted. Arizona has not had an oil-related FOIA request in the past 26 years, according to Steve Rauzi, commissioner of the Arizona Oil and Gas Conservation Commission. Thirteen states, including Maine and New Hampshire, don’t have exclusive departments that deal with oil and gas.

One state, however, has always been synonymous with “big oil”: Texas. The Texas Railroad Commission oversees the oil and gas industry, which is the largest in both crude oil and natural gas production, accounting for more than a third of U.S. reserves, according to the Energy Information Administration.

Houston Chronicle reporter Lise Olsen is familiar with the obstacles faced when reporting on the oil industry in the Lone Star State. Her story last year, “Peril in the Oil Patch,” focused on worker deaths and traffic accidents related to oil spills and the disposal of oil dust.

Olsen went to agencies not often thought about in environmental stories: the Texas Department of Transportation for information on fatal accidents, the Occupational Safety and Health Administration for worker injury claims, and the Securities and Exchange Commission for company filings. She was also met with exemptions for oil companies: OSHA redacted medical information and trade secret information. Workers refused to talk or backed out of interviews at the last minute over the fear of losing workplace compensation. While some oil companies invited Olsen to see the drilling and training sites, others refused to respond, some because they were in the midst of ongoing litigation.

However, Olsen persevered, in part from prior knowledge she had about the industry from Gulf of Mexico Deepwater Horizon oil spill coverage and by contacting local experts. After the story ran, one of the oil companies was placed on OSHA’s “severe violator” list, and the number of drilling deaths slowed. OSHA also promised to step up its safety program for oil companies, but Olsen said this promise has been made many times before.

The Other Side

Ragan Dickens and the Louisiana Oil and Gas Association serve as the mouthpiece for about 1,700 oil companies with wells based in the state. Dickens, the communications director, represents the industry as a whole in all kinds of stories: “the good, bad, economic, legislative, on TV, radio, newspaper and Web,” he said.

Trade associations like the Louisiana Oil and Gas Association assist in lobbying and legislation on behalf of the industry, as well as collect data from companies and third-party sources. When it comes to trade secrets, Dickens knows they exist but is not privy to them. Instead, when a regulatory issue arises, the association gets all companies on the same page, so the public record appears consolidated and no one can tell which oil company holds a certain belief. It keeps the secret from the public and from the other companies, ensuring competitive advantage.

Nearly everything the Louisiana Oil and Gas Association participates in becomes public record, Dickens said. They are required to file with the Louisiana Board of Ethics and register as lobbyists, disclosing pay scales and topics they work on. All court proceedings in which they represent the industry are made public after the final ruling, as are ordinances and regulations passed.

The organization is not a record-keeper but a mediator between companies, the courts and state governments. Unlike an oil company that may not have a spokesman willing and able to talk, a trade association might be able to provide at least some insight and serve as an unconventional source for stories, especially in politically charged stories.

Understanding Oil

Oil fuels our cars, heats our homes and, in some cases, powers our economy, government and international relations. Yet somehow a giant industry has managed to hide the information that the public desires under the exemption of “trade secret.” Environmental groups, journalists and freedom of information advocates can push for changes in policy; people are starting to take a stand. What changed?

Oil industries have taken fracking procedures out of largely rural areas and moved into neighborhoods in the quest to discover new drilling sites, said Bobby Magill, oil reporter at Climate Central. He has seen this firsthand in Colorado, as industrial operations made their way into neighborhoods.

“People get scared when they see these operations setting up; it’s something they don’t understand, something that can affect water contamination and air quality,” he said. “Industry comes in and steps on people’s toes. It changes what the idea of home is. People go to the local government, which can’t do anything because oil is regulated by the state. This is one of the reasons why people in Colorado are upset.”

And it’s the reason why he pushes back.

The coming year promises even more coverage for oil and gas reporters, as investigations continue into seismic activity in Oklahoma, health hazards of fracking fluid and construction of the Keystone Pipeline. Journalists should be ready to cover the industry, especially if located in a community that will be newly affected. Idaho, for example, is anticipating an increase in fracking when the pipeline is complete.

Learning about the current FOIA barriers, and the reasons for them, will be crucial in obtaining information on deadline to produce relevant stories. The effects of oil stretch far beyond the factory field and cannot be ignored. After all, as Noah Brenner said: “If you understand oil, you will understand one-third of what is going on in the world.”

Ashley Mayrianne Jones was SPJ’s summer 2015 Pulliam/Kilgore Freedom of Information fellow. In the course of her fellowship, she was offered a job at the Virgin Islands Daily News, which she accepted at the end of the summer internship period. Interact on Twitter: @amayrianne

Stay in Touch
Twitter Storify Facebook Google Plus RSS Pinterest Pinterest
Flickr LinkedIn Tout



Current Issue
Browse Archive
About Quill
Advertising Info
Back Issue Request
Reprint Permission Form
Pulliam/Kilgore Internship Info

Search Quill


Publications
SPJ Blogs
Quill
SPJ Leads
The EIJ News
Press Notes
SPJ News
Open Doors
Geneva Conventions
Annual FOI Reports

Copyright © 1996-2017 Society of Professional Journalists. All Rights Reserved.

Legal | Policies

Society of Professional Journalists
Eugene S. Pulliam National Journalism Center
3909 N. Meridian St., Suite 200
Indianapolis, IN 46208
317/927-8000 | Fax: 317/920-4789

Contact SPJ Headquarters
Employment Opportunities
Advertise with SPJ