Currently, there is no federal law regulating fracking. Instead, fracking is only regulated under state law. Public disclosure requirements vary widely from state-to-state. Some states have no disclosure requirements at all. Of the states that do, most have included trade secret exception provisions allowing oil and gas companies to refuse to disclose the chemicals they use in fracking. More importantly, very few state laws that have trade secret exceptions also require that the company provide any substantiation that the trade secret is legitimate. Without some kind of uniform factual substantiation requirement, what is to keep oil and gas companies from abusing trade secret exceptions?
A possible solution has emerged. In March of 2015, the Department of Interior’s Bureau of Land Management (BLM) released the first important federal rules governing fracking on federal and tribal lands. The law only affects approximately 100,000 oil and gas wells in the United States, but has already caused widespread concern among its opponents. Wyoming, Colorado, North Dakota, Utah, the Ute Indian Tribe, and two oil and gas industry organizations have filed claims for review of BLM’s rules in the U.S. District Court of Wyoming. The arguments that have transpired offer a clear perspective into the controversy surrounding chemical disclosure and trade secret exceptions.
Through analysis, it is apparent that BLM’s new fracking rule should be uniformly adopted as a solution to the tension between disclosure requirements and trade secrets. Part I of this Note defines hydraulic fracturing and provides a history and background of the two conflicting theories: trade secrets and environmental “right-to-know” policies. Part II introduces the BLM’s new federal regulation and examines how it has addressed conflicts between trade secrets and chemical disclosure. Part III discusses the current problems with fracking regulations, and addresses how trade secrets and chemical disclosure play a part in its controversy and why BLM’s new regulation can be a solution. This Note concludes that BLM’s new regulation is a much needed and effective compromise between the conflicting theories of trade secrets and chemical disclosure.
Conflicting Theories at Play: Chemical Disclosure and Trade Secrets in the New Federal Fracking Regulation, 9 Golden Gate U. Envtl. L.J. 217