Wyoming Supreme Court Advances Disclosure of Fracking Chemicals

by Sofia Plagakis, 3/25/2014

In a partial victory, the Wyoming Supreme Court ruled that Wyoming's District Court must reconsider public disclosure requests for chemicals used in fracking fluid, and the Wyoming Oil and Gas Conservation Commission (WOGCC) cannot simply claim information on fracking chemicals is protected under a trade secrets exemption. The lawsuit could set an important precedent in the disclosure of chemicals used in fracking, also known as hydraulic fracturing.

Background

In 2010, Wyoming became the first state to pass a rule requiring disclosure of the chemicals used in fracking, following well publicized instances of water contamination near well sites. However, the rule contained an exemption for so-called "trade secrets." The trade secrets, or confidential business information, exemption is a loophole that allows drillers to keep some things secret, claiming it will hurt their competitiveness if the information was made public.

In August 2011, the Wyoming Oil and Gas Conservation Commission (WOGCC), the state agency with oversight over fracking, granted 11 drilling companies trade secrets protections for 146 out of 148 chemicals they acknowledged using in fracking. Local organizations submitted a public records request for the complete list of fracking chemicals. The WOGCC refused to disclose any of the chemicals that had been granted trade secrets protections.

The Lawsuit

In March 2012, Earthjustice, a public interest law firm, filed a legal petition on behalf of the Center for Effective Government (formerly OMB Watch), Powder River Basin Resource Council, and the Wyoming Outdoor Council. The groups argued that the WOGCC should be required to reveal the identities of chemicals used during fracking. Our petition asserted that the Wyoming Public Records Act and the state's 2010 fracking chemical disclosure rule required WOGCC to disclose the information.

In March 2013, the district court upheld the WOGCC's decision to withhold the identity of chemicals as requested by Halliburton and other energy companies under Wyoming's open records law. The district court concluded that the WOGCC's supervisor, who withheld the information, "acted reasonably."

The New Ruling

We appealed to the Wyoming Supreme Court. On March 12, the court issued its ruling. In its opinion, the court noted that Wyoming's public records law requires state agencies to explain why a request for information is denied. The court found that the WOGCC had failed to provide such an explanation and as a result, the district court did not have enough information to evaluate the state agency's decision, stating, "The record does not tell us what specific information the Supervisor relied upon, or why he did so, and therefore neither this Court nor the district court has a sufficient basis to determine whether he acted properly or not."

The state Supreme Court's decision also held that the state's Oil and Gas Commission has the burden of proof for justifying its use of trade secrets exemptions. The court further ruled that the withholding of information must fall within a narrow definition of trade secrets that generally favors disclosure over secrecy. The WOGCC wanted to use a broader definition of trade secrets, which would allow more withholding of chemical information from public disclosure and review.

"The district court will have to review the disputed information on a case-by-case, record-by-record or perhaps even on an operator-by-operator basis, applying the definition of trade secrets set forth in this opinion and making particularized findings which independently explain the basis of its ruling for each," Justice Michael Davis wrote in the opinion.

Public Reaction

Local landowners and residents welcomed the court's ruling. "It is important for public health and safety that citizens have timely access to what chemicals are used in fracking operations on and near our land," stated Kristi Mogen, a Resource Council board member who lives near fracking operations in Converse County, Wyoming.

Groups involved in the lawsuit also praised the new court ruling. "We're glad that the Wyoming Supreme Court agrees that this critical chemical information should be disclosed to the state's residents and public interest organizations," stated Sean Moulton, Director, Open Government Policy, Center for Effective Government. "The recipe for Coca-Cola is a trade secret, but the ingredients are not, and they're all listed on the can."

However, in a written statement, Halliburton said that when the district court takes up the issue, "Halliburton expects to demonstrate again that the identities of its proprietary chemicals qualify as trade secrets under the [Wyoming Public Records Act]."

Next Steps

The Wyoming Supreme Court directed the Natrona County District Court to review the action of the Oil and Gas Commission based on its narrower definition of trade secrets.

The case could set a broad legal precedent for future cases in the more than 10 states with chemical disclosure rules similar to Wyoming's. Residents need information about the chemicals used in fracking to understand the risks and trade-offs involved in natural gas drilling.