Falling victim to a Legislature pre-occupied with massive budget deficit issues and last minute wrangling over the Governor’s corporate tax package on out-of-state companies, AB 591, California’s legislative foray into the charged arena of hydraulic fracturing regulation, stalled in the State Senate’s Appropriations Committee. In its current form, the bill embodied a fairly comprehensive agreement between the bill’s author, Assemblymember Wieckowski, and its sponsors, but several outstanding issues remained. Among the remaining outstanding issues was mandatory reporting of hydraulic fracturing fluid components. The sponsors had hoped for far-reaching reporting regulations for hydraulic fracturing fluid, but confidentiality issues based on trade secret concerns led to protracted negotiations that stalled the bill. AB 591’s proposed language had included requirements mandating disclosure of the constituent compounds in each operator’s hydraulic fracturing fluid, and requirements for disposal of such fluids. With the end of the regular legislative session today, interested parties can expect a new version of the bill to appear early in the next legislative session, set to open on January 4, 2012. If it is adopted as an urgency measure, it would take effect immediately, and oil and gas operators could potentially be faced with immediate reporting obligations under the legislation beginning in early 2012.
