what's going on that all of a sudden the epa has to get involved in fracking. this isn't new. it's 60 years old. it's been going on for a long time. we're talking about eight times the empire state building one on top of the other it's that far below the surface. this isn't right at the surface. i get concerned about that. we hear about this new technology. i know there's great innovation in the horizontal drilling. if you could -- you are from pa. we have talked before. why now? what's going on that it's this public concern? and what brought it about? >> i think it harkens back to the article that i just mentioned that i'd be happy to provide the committee. also i do believe and i think madison wrote about this in the federalist papers, there's a tendency of power to want more power. so that may be part of what's going on here as well. >> okay.

>> i believe first of all you have to keep in mind that some people are labelling all kinds of issues associated with oil and gas drilling and production as hydraulic fracturing. there are certainly some issues associated with the rapid development of oil and gas in areas where it has not occurred before. we've seen that happen in various parts of the country. it's happened in certain areas of oklahoma. >> this has been around for 60 years. we never had this degree of concern before. there's a large swath of marcellus shale through pennsylvania. why this little town and why not some of the other areas? >> i can -- if you're asking me, i can talk for an hour about demic and i won't.

the state had been taking care of issues in dimmic from an enforcement standpoint for a long time. all of a sudden the epa for reasons i have no idea decided in jarngs that -- in january, that they have to come in as a big brother or a white knight or whatever to come in and do whatever testing and start supplying water to four families. as the representative correctly pointed out, it was interesting the reports of no health impact would always come out on a friday afternoon at about 4:00 and then they would die in the press. there's been four rounds of sampling and four nothings. and the representative was very interested in that. even at mid course they had spent $1 million already out of the superfund response fund which certainly could have gone a long way in northeastern pennsylvania on a lot of superfund response projects. >> in that case, they tested 59 wells and found nothing that indicated that the fracking was causing any problems. >> they found no health impacts whatsoever. remember when they came into the town in the fir flais nevst play

never made a connection between hydraulic fracturing and what it is they were looking for. i asked them specifically. >> i think all of us are concerned sound science i'm in favor of. >> dimmic was put on the radar, if i get my history correct, by the film. >> all of us are concerned. sound science i am in favor of. political science, i wonder. because a lot of this is a result of, if you don't succeed at first, try, try it again. i am wondering where we are going with this. and at what point, what point, do's the epa walk away from this and say we don't need this. i know in pennsylvania you have done a great job. in oklahoma you have done a great job. the question does come down and always in this town we talked about it, when is it that the federal government gets out of the way and lets the states take care of themselves. >> that is a great question. i've never been compared to in

favor of jim crow on federal/state relationships, let's remember the history is the federal government has never shown an interest whatever administration, whatever congress, whatever epa that's what the safe drinking water act was about. that's what the 2005 energy policy act was about. that was a bipartisan act in which ken salazar and the president of the united states, current president of the united states voted for. >> i would think that right now this great abundance and the accessibility and affordability of natural gas has had a great influence on a green agenda that was supposed to be the bridge to get us there. now we're finding out that instead of being the bridge it is actually the bed rock of energy in this country. it puts us in a position, you and i have talked earlier about this, i don't want to be in a fair fight with the rest of the world when we have natural resources here provided by god we are not taking advantage of to put ourselves in the best position in the world economically. why in the word would we continue to keep the

government's boot on the throat of success, for the jobs of this country and the revenue that could be produced. i know i'm out of time. i know it's frustrating. we'll keep working on it and try to get to the bottom of it. thank you. >> thank you. >> thank you very much. i would look to start with -- i would look to thank the panelists all for being here. i would look to start, my neighbor to the north in oklahoma, i'm from texas. >> exxonmobil put together a little graph that i wanted to share with you guys. this shows drilling. about 100 feet under you'll typically hit the ground water. and i realize you might have a little difficulty seeing that. and then to protect the ground water there's multiple levels of concrete and steel casing. this is true in conventional wells that go down and hit a pool of oil or gas and a reservoir of oil and gaz, as well as when hydraulic fracking is used. is that an accurate statement? >> yes. generally the way -- the way the

fresh water resources are protected. >> right. so -- >> the well. >> in a case there is hydraulic fracking opposed to traditional, it's protected the same way, similar risks of groundwater contamination exist from how we've been producing oil and gas since the civil war. basically. >> we've had -- >> obviously some technical improvements. >> we've had casing and cementing requirements for oil and gas wells for many decades. they've actually evolved and improved over the years. but a basic principal throughout the history of regulation has been we case the well through the fresh water zone to isolate. >> all right. and so when you frac a well, you're quite a bit below the water table. the water table is what -- a couple hundred feet in oklahoma? >> it varies.

that's one thing the geology -- >> you're talking hundreds of feet, not thousands of feet. >> it can be -- in a few isolated areas it can be very deep. typically you're right. >> the local regulators have a good understanding. >> and we have that actually mapped. we have on, our internet, the maps that show the base of freshwater throughout the state of oklahoma. so when you're fracking you're traditionally much, much, much deeper. we're talking miles -- certainly most texas cases at least a mile, some times two miles below the water table. so that, the chance of something migrating up through the rock going up two miles is -- just defies common sense itf that's an, issue. let me go on and visit with mr. mckee. most of your land you have got to get building permits and all

sorts of permits. in texas we fly through it in weeks months. certainly not years in getting something permitted on on private land. this is costing -- i assume there's a cost associated with this, not just with jobs, is that correct? >> yes, that's correct. this was a study that was just released that shows that the investment on every well is about $6 million in utah. and so when we -- you know, there's the mineral lease royalties, the jobs. there's the -- >> and when land is leased from the federal government you pay a bonus to get the lease. you buy the lease. >> that's correct. >> then from everything that's produced the federal government gets a royalty. we get a percentage of all the oil -- money and all that oil and gas and so forth that we could use to pay for roads and highways, that we can bring into the federal budget to help balance the budget. it's a source of income we're losing as a federal government. >> absolutely. let me give an example.

recently six leases were reinstated i believe it's about 6,000 acres. the right to lease on those lands it cost the bidders $48.6 million for the 6,000 acres. just for right to drill. there's a royalty that comes into the federal government that's a sharing formula with the states. that's a tremendous source of revenue. i indicated there were over $200 million of federal mineral lease royalties coming out of my county. >> i sit on the transportation and infrastructure committee. one of the ways we're looking for maintaining our deteriorating infrastructure, roads, bridges interstate highway system is using that royalty money. those delays are costing the american people in not just dollars and cents but in much needed repairs, but even the safety of our highway system. >> absolutely. >> let me go on to mr. kranzer. are you familiar with the

statement of the former region six epa director al almaderez? he says it was the epa's goal -- or he wanted to crucify the oil and gas industry. do you see that as actually happening? >> you don't really want to lead me into that discussion, do you? >> i'm from texas. he was our epa guy. >> actually, i metal once. i only know what i have read in the papers. >> do you feel like the epa is targeting? do you get a feeling that they're targeting the oil and gas industry unfairly? >> well, i try to keep my eye on my own court and what we're doing. i do see permit delays. permit lags. >> i talked this morning about the rocket docket for regulations, historic regulations in air and so forth, compared to the snail doekt for getting permits done. >> i see i'm out of time.

thank you very much, mr. chairman. thank you, panel. >> we're going to do just a couple minutes of questioning. to do follow-up on it. for the three state regulators i need some clarification. this is just a process question. new guidance has been released by epa dealing with the diesel fuels issue and epas involvement, obviously there's been oversight process for fracking in states. what i'm interested in for you on how you're interpreting that. how it's working through the process of that guidance dealing with diesel fuels and fracking and expanding the definition of diesel fuels. does that make sense? >> i know this is in process. how is that going? what are you doing with that? >> it is in process. we are reviewing the document. i will say it does not directly apply to the state of oklahoma because we administer the uic program for oil and gas operations under section 1425 of the safe drinking water act. and so we have a little bit different framework but we are

looking at it closely because there's no doubt that epa will be coming to visit with us about how we address the various elements that are in that guidance. there are some key issues in there that concern us we are putting our comments together and we will be submitting those. >> is it your assumption that guidance will become a rule or is it your assumption this is a opinion piece that will probably affect blm areas but won't affect private areas? >> we are concerned the epa will implement it as if it were a rule. >> okay. rule or not that they apply it the same? >> yes. >> okay. >> were you talking about the blm rule or the diesel fracking? >> diesel fracking permit. >> let me say first that i don't believe that's going to be an issue in pennsylvania. there's no information that we have that diesel fuel is being used for fracking. i don't know whether that is going to be an issue in other states. epa does have primacy of the uic program in pennsylvania and

that's because we just don't do a lot of uic disposal. but i think, you've hit the nail on the head. we have to keep an eye and the country does on how that diesel fuel does. >> epa is trying to redefine what's a diesel fuel. that was my question to you -- that conversation is ongoing. how are you processing that at this point? >> we're watching it very carefully. it is the proverbial, hate to use it, but nose in the camel's tent. the 2005 energy policy act did exclude fracking with diesel fuel. we all know that. if you define diesel fuel to be everything, then you have probably gone beyond what the law intended and acted illegally to boot. >> okay, thank you. one quick last question. the comment was made earlier about earthquake s and oklahoma based on fracking, and direct tie on that. are you aware of earthquakes in oklahoma based on the fracking itself? >> we are working with seismologists at the university of oklahoma and the oklahoma

geological survey to study the possible connection between earthquakes and various types of oil and gas operations. any statements made that there's been some kind of conclusive link are premature. >> are earthquakes in oklahoma common? small earthquakes? >> yes. we live in a seismically active area. and the record show that. >> thank you. i yield to the ranking member for three minutes as well. >> i thank the chair. mr. mckey, i w-- like you i com from local government, i was the chair of my county before i came here. so i appreciate your service. i think oklahoma is very important. did i understand your testimony to mean that you felt that excessive federal regulation, blm regulation, interalia, had

served as an impediment to job creation in your community? >> that is correct. >> what is the unemployment rate? am i pronouncing your county right? uintah? >> uintah? >> today it's about 4%. however, when the downturn in the economy happened we didn't -- because we are an extractive community, we didn't know there was a recession going on as far as what we were feeling until we had new policies that came in and almost overnight we lost a number of jobs because of new policies. >> but at 4.1%. which is pretty low? pardon me? >> today it's good. 4%. >> 4%. how does that rank with other counties in utah? >> we're among the best. as far as -- >> might it be the lowest rate

unutah? >> i would have to double check that, i'm not sure. i know we are pretty good because of oil and gas. >> what percentage of your county is federal or controlled land? >> i know we're only 15% privately held. i believe it's about 59% that's blm. and some forest things. and 4.5% with the tribe. little state institutional trust lands. >> do you have any idea on that federal land how many leases have in fact been or permits have been granted but not utilized? >> i know there's a fairly strong backlog on the permitting process today, i was told there are over 1,000 permits that are in backlog that they have not been able to issue because of the backlog issue. >> uh-huh. but in some cases it is also a utilization issue that some have been granted and not used. >> what i am told is -- there's -- it's -- it's many times -- it's very difficult

because sometimes these permits show up in the category as though they've been issued but they're still waiting for the government to finalize what they're doing so they get held up. >> obviously one of the things we've been talking about is air pollution. whether it can be attributed to fracking or whatever. yours is largely a rural county, is it not? >> it is. >> we would expect in a rural county relatively clean air. how does uintah county stack up in that regard? >> we do have overall our air quality is good with the exception of winter ozone. we do have a winter ozone issu . i would look to touch on that for a moment. >> certainly. >> if i could disagree with my colleague to the left here. he indicated fracturing was causing the winter ozone issue. i have personally have been very involved with this issue meeting

with state and even in the epa offices in denver. and as we have had roundtable discussions, extensive studies going on. i have never yet heard to this day any tie to hydraulic fracturing. >> i know my time is running out. i was stunned to learn that you actually top los angeles on a number of occasions at 149 parts per billion with respect to ozone. in fact, the epa called it unearthly at some point. what is the cause of such high ozone levels in the county? >> this study is going on -- it appears this its what i was referring to a moment ago, this is tied -- it appears to be a number of factors that the scientists are still trying to learn about. one of the things they recognize, it's tied with sunlight and snow. this past winter we didn't have very much snow on the ground. we did not have any exceedances,

we were well below the number. a year ago we had deep snow and the numbers were fairly high and so the scientists, the jury's still out. that's what they're trying to find out. >> trying to find out. i thank you very much. thank you, mr. chairman. >> we'll take a short recess to prepare for the second panel. panelists, thank you very much for being here and staying through two round of questioning on that. i appreciate your time very much.

thank you both for being here. nancy stoner is acting director for the water and u.s. environmental protection agency. mr. michael is acting director of the u.s. bureau of land management as of today. we're breaking you in officially. we'll try to be done before your placed as acting administrator. as i mentioned we do have votes that will be called shortly we will try to get in both your testimony and deal with questions as we go. we'll be glad to receive your testimony. >> good afternoon.

chairman lankford, i'm nancy stoner, acting administrator for water and u.s. pepa. >> i apologize so much for this. i did not swear everyone in. >> okay. >> every hearing has to have some swearing in it. if i could ask both of you to stand in. that is pursuant to committee rules. >> of course. >> i apologize for that. please raise your right hands. do you solemnly swear or affirm that the testimony you're about to give the committee is the truth, the whole truth and nothing but the truth so help you god? thank you. let the record reflect that the witnesses have answered in the affirmative. i apologize >> that's okay. for having to stall you. i think i'll pick up right where i stopped. the epa and this administration recognize that natural gas represents an important resource for our country. it has the potential to create jobs, promote energy security. lower energy price and reduce harmful emissions to air and water. at the same time the administration is committed to

ensuring the production proceeds in a safe and responsible manner. we believe that we can protect the health of american families and communities while enjoying the benefits of expanded natural energy reserves. states are the primary regulators of onshore oil and gas activities, the federal government has an important role to play by regulating oil and gas activities on public and indian trust lands, research and development aimed at innovation to improve the safety of natural gas development and transportation activities and setting sensible standards to implement federal laws and complement state safeguards. as the senior policy manager for epa's national water program, i'd like to highlight a few of the epa's recent actions under the safe drinking walter act and clean water act intended to ensure that natural gas production can remove protected

the safe drinking water act governs the construction, operation and perming and closure of underground injection well for the protection of underground sources of drinking water. under ground injection control or uic programs administered by epa or the states are responsible for overseeing these injection activities. however, the energy policy act of 2005 excludes hydraulic fracturing from regulation under epa's uic program except when diesel fuels are used in propping agents. the epa has heard from the industry and the public that we should clarify the applicability for the diesel requirement as well as how permits should be written. in response and in light of the significant increase in natural gas production in the united states, we have developed draft guidance to clarify requirements under the safe drinking water act and to help

prevent the endangerment of underground sources of drinking water from hydraulic fracturing using diesel fuels. the epa used this draft guidance with input from industries, states, tribes, and other agencies. environmental organizations and the public. i'd like to emphasize as is the case with all guidance, the draft document does not impose any new requirements. the draft clarifies existing statutory and regulatory requirements and provides technical recommendations for applying uic class two requirements to the diesel fuels hydraulic fracturing process. it is intended for use by epa permit riders under the uic program and will be applicable where epa is directly responsible for the uic class two program. we're taking public comments on the draft through july 9th and welcome comments from all aff t affected parties and the public. the agency has also initiated

efforts under the clean water act to provide regulatory clarity and protection to risks to water quality. in october 2011 epa announced a schedule to develop pretreatment standards for waste water discharges produced by natural gas extraction from underground cold bed and shale formations. in addition, epa is assisting state and federal permitting authorities in the marcellus shale region by answering technical questions concerning the treatment and disposal of waste water from shale gas extraction. the epa has also been conducting research to better understand the impact of drink iing on wat resources, and that's through our office of research and development. in conclusion, activities relate ed to hydraulic fracturing help assure that public health and water quality remain protected as natural gas helps to promote our nation's economic recovery and security. thank you for the opportunity to testify before you today and i'm happy to take any questions you may have. >> thank you very much.

mr. pool? >> mr. chairman and members of the subcommittee, thank you for the opportunity to discussion the bureau of land management development and their application of federal and tribal trust lands. we also provide permitting and oversight services on approximately 56 million acres of indian trust millionaires. the secretary of the interior salazar has emphasized that as we move forward, the development of conventional energy resources will continue to play a crucial role in meeting the nation's energy needs. facilitating the safe, responsible and efficient development of these domestic oil and gas resources is the responsibility and part of the administration's broad energy

strategy to protect consumers and help reduce dependens on oil. fiscal year 2011 federal oil and gas royalties exceeded $2.7 billion. approximately half of which was paid directly to the states in which the development occurred. tribal well royalties exceeded $400 million with 100% of those revenues paid to the tribes and individual indians owning the land on which the development occurred. oil and gas production on shelves has grown considerably and is expected to continue in coming decades. factors contributing to the success includes hydraulic fracturing and horizontal drilling. the bill estimates that approximately 90% of wells on public lands and indian lands are stimulated by hydraulic fracturing techniques. the increasing use of hydraulic

use has raised public concerns about the potential impact on water availability and quality particularly with respect to the chemical composition of fracturing fluids and the methods used. the bill recognizes that some but not all states have taken action to address hydraulic fracturing in their own regulations. one of the blm's key goals in updating its regulations in hydraulic fracturing is to complement the state efforts by providing a consistent standard across all public and indian lands. the agency has a long history of working cooperatively with state regulators to coordinate state and federal activities. the proposed rulemaking is not intended to duplicate various state or federal requirements. the blm is to encourage proficiency in the collection of data and the reporting of information. the development includes tribal consult tags and the policy. this policy emphasizes trust, respect and shared

responsibility by providing trial governments an expanded role to perform federal policy that impacts indian lands. the blm conducted a series of meetings in the west with significant development in indian and oil and gas resources. nearly 180 tribal leaders were invited to attend these meetings held in tulsa, oklahoma, billings, montana, and farmington, new mexico. 84 tribal members representing 24 tribes attended those meetings. on may 11th, 2012, the blm sent 180 invitations for continued government to government consultation to exchange information on the development, hydraulic fracturing rule. as the agency continues to control with tribal leaders throughout the rulemaking processes, responses from these representatives will inform our actions and define the scope of acceptable hydraulic actions. the blm's rule is consistent.