The shale gas boom and fracking revolution are having a significant impact on the economies of states like Ohio. Some environmentalists are also seeing the positive side despite the drinking water controversy as natural gas burns much cleaner that coal.

But many legal issues remain and loom on the horizon.

Ohio’s anticipated energy boom from hydraulic fracturing of shale deposits has oil and gas companies, investors and property owners scrambling for a piece of the action.

On the way to digging up the expected treasure, though, are legal sand traps that could slow or even stop production. They go well beyond the basic issue of who owns the buried oil and gas rights, disputes hashed out in courts since the start of the Utica shale rush in 2010.

Emerging battles concern possible threats to endangered species, Clean Air Act violations and claims that oil and gas drilling in Ohio is abnormally dangerous.

The Utica shale layer, centered in Ohio but stretching from Quebec to Tennessee, has been touted as holding hydrocarbons worth tens of billions of dollars — maybe $500 billion worth, if you believe the prediction of Aubrey McClendon, chief executive of Chesapeake Energy Corp., the top driller in Ohio.

The Ohio Shale Coalition estimates that almost 2,000 fracking wells will be drilled in the state by the end of 2014.
Recent fracking-law discussions at Case Western Reserve University School of Law and the McDonald Hopkins law firm in Cleveland, as well as interviews with energy-sector attorneys, suggest a boom of another sort — in legal questions that riddle the shale play.

Stay tuned as this issue develops.

Free image courtesy of FreeDigitalPhotos.net

With the election now over, the issue of environmental regulation will be a hot topic in Washington.

EPA’s critics say they see ill omens for President Barack Obama’s second term in Friday’s announcement of significantly tightened air pollution limits on soot from exhaust pipes and smokestacks.

The finished rule that emerged from the agency Friday is mostly as stringent as the one that EPA submitted for White House review in the summer. That’s a turnaround from the experience of the last couple of years, in which White House pressure forced the EPA to postpone a new rule on smog and placed regulations on toxic coal ash into a deep freeze.

The latest development heartened environmental groups, which praised the Obama administration for standing up to pressure from industry and the Hill — though some say they’re still waiting for tough action on climate change.

“Our air will be cleaner and thousands of Americans won’t have to face the dangerous health impacts of soot pollution from dirty sources like power plants and diesel trucks,” said Gene Karpinski, president of the League of Conservation voters.

But Friday’s announcement also had some industry groups wondering what to expect in the coming months, when the EPA is expected to finish regulations for greenhouse gas emissions from new power plants, with a host of pending regulations for industrial boilers, power plants and the coal industry waiting in the wings.

“We think it is [a] troublesome sign from the EPA,” said National Association of Manufacturers spokesman Jeff Ostermayer. “Most of these regulations have been on hold since before the election, and now we fear we will see them move forward with one after another, which is not good for an economy still struggling to recover.”

One outspoken industry supporter, Sen. Jim Inhofe (R-Okla.), has been warning for months about what he calls the “regulatory cliff” — a deluge of regulations brought on by a second Obama administration unencumbered by reelection worries. He called the new soot rule “the first in an onslaught of post-election rulemakings that will place considerable burdens on our struggling economy.”

We’re seeing a resurgence of manufacturing jobs in this country, but many argue that EPA regulations will strangle that progress. Well, we haven’t seen that so far in the fracking industry, as both sides are engaged and we’re seeing common sense regulations in states like Ohio.

But with global warming emerging as a huge issue, the political will for common sense regulations may be growing. It looks like the Obama administration is ready to proceed. The key with be whether they can balance the need to clean up and protect the environment with the need for industry and jobs.