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The Canadian Press - ONLINE EDITION

Federal agency acknowledges it needs to do more to improve oversight of oil and gas drilling

WASHINGTON - The federal agency tasked with managing oil and gas development on Wednesday acknowledged it needed to do more to improve oversight of drilling, pointing to a lack of funding as reasons it failed to inspect oil and gas wells it considers potentially high risks for water contamination.

Jeff Krauss, a spokesman with the Interior Department's Bureau of Land Management, noted that his agency has worked hard to keep up with the nation's energy boom, which has included the increased use of hydraulic fracturing, or fracking, a drilling technique that environmentalists fear could spread chemicals to water supplies.

He said BLM is counting on Congress to approve a budget request that would allow it to use $10 million raised from fees charged to oil and gas companies to pay for the high-priority inspections.

"The safe and environmentally sound operation of oil and gas activities on the nation's public lands is a high priority," Krauss told The Associated Press. "While federal onshore oil production is the highest it has been in a decade and has risen for the fourth year in a row, the BLM continues to improve oversight of energy development on public lands."

An investigation by the Government Accountability Office, Congress' auditing arm, found that BLM had failed to conduct inspections on more than 2,100 of the 3,702 wells that it had specified as "high priority" and drilled from 2009 through 2012; the agency also had yet to indicate whether another 1,784 wells were high priority or not. BLM considers a well "high priority" based on a greater need to protect against possible water contamination and other environmental safety issues.

The audit also said the BLM did not co-ordinate effectively with state regulators in New Mexico, North Dakota, Oklahoma and Utah. GAO said it did not break down by state the list of high-priority oil and gas wells that BLM had yet to inspect.

A separate review earlier this year by the AP of Pennsylvania and other states also found hundreds of complaints have been made about well-water contamination from oil or gas drilling, with pollution confirmed in a number of them.

Regulators contend that overall, water and air pollution problems are rare, but environmental groups and some scientists say there hasn't been enough research on those issues. The industry and many federal and state officials say the practice is safe when done properly, and many rules on air pollution and disclosure of the chemicals used in fracking are being strengthened.

This week, Sen. Edward Markey, D-Mass., a member of the Senate Environment and Public Works Committee, asked Interior Secretary Sally Jewell to explain what the department has done and will do to increase well inspections.

"Our drilling regulators need to know that with increased drilling comes increased responsibility to protect our water, air, land and climate," Markey wrote in a letter to Jewell.

He asked her to respond by June 9.

The Interior Department said Wednesday it had received the letter and was reviewing it.

The BLM has noted that since 2000, nearly 47,000 new wells have been drilled on public and tribal lands. The agency now oversees roughly 100,000 wells, the most ever. It has pointed to its request for additional funding for inspections via fees charged to oil and gas companies as a way to fix oversight problems and other shortcomings identified by GAO and other investigations.

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Online:

Link to GAO report:

http://www.gao.gov/products/GAO-14-238

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