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The Tarrant case is a dispute between Texas (Tarrant, Texas Regional Water District) and Oklahoma over water located in the Red River. The Texas Water District believes it has a right to access water in the Red River in Oklahoma pursuant to an agreement signed by Texas, Oklahoma, Arkansas and Louisiana (the “Red River Compact”). Siding with Oklahoma, the lower agreed that Texas is only guaranteed a certain minimum downstream flow under the Compact. In this context, the case appears to have very little to do with the compacts governing water use within the Great Lakes basin.

However, it’s the Water District’s constitutional argument that the Great Lakes States and Canada should pay attention to. The Water District claims that the “protectionist” character of the Red River Compact violates the dormant Commerce Clause of the U.S. Constitution. The Commerce Clause of Article 1 of the U.S Constitution gives Congress the exclusive authority to regulate interstate commerce. The dormant Commerce Clause is the legal theory that because Congress regulates interstate commerce, States cannot enact legislation that unreasonably restricts interstate commerce and prevents States from being “protectionist” with their natural resources.

According to the Water District, the Supreme Court has consistently required that Congress unambiguously acknowledge and approve a statute’s or a Compact’s unreasonable restrictions on interstate commerce and cited Sporhase v. Nebraska, 458 U.S. 941 (1982) and South-Central Timber v. Wunnicke, 467 U.S. 82 (1984) in support of its position. In the Water District’s view, Congress has to explicitly approve the restrictive nature of the Compact and Congress’ intent cannot be gleaned by looking at the restrictive language in the Red River Compact as a whole.

The two main compacts affecting the Great Lakes are the Great Lakes Charter and the Great Lakes St. Lawrence River Basin Water Resources Compact. A detailed description of the scope of each is beyond the intent of this article, but the following provides a brief summary of each:

• Great Lakes Charter / Annex 2001. Established a cooperative arrangement between the Great Lakes States and Ontario and Quebec whereby each party agreed to provide notice to each other and to consult on any proposed diversions of water from the Great Lakes Basin.
• Great Lakes – St. Lawrence River Basin Sustainable Water Resources Agreement / Great Lakes St. Lawrence River Basin Water Resources Compact. Established the structure that the Great Lakes States and Provinces use to manage water withdrawals from the Great Lakes Basin. In particular, the agreements call for an outright ban on new diversions of water from the Basin and grant only limited withdrawals for use by communities within the Basin. The agreements are managed by two governing bodies: the Great Lakes – St. Lawrence Water Resource Regional Body and the Great Lakes – St. Lawrence River Basin Water Resources Council. Congress consented to and approved the Water Resources Compact in 2008 by enacting Public Law 110-342.

Depending on how the Supreme Court rules in the Tarrant case, if the Red River Compact falls, it could put the Great Lakes Compacts on shaky ground. Although Congress approved the Compact in Public Law 110-342 in 2008, it did not make any statement that it was explicitly authorizing the Compacts’ unreasonable restraint on interstate commerce. Although such an intent could be inferred from Congress’ approval of a Compact that clearly calls for a ban on out-of-Basin diversions, this is the type of argument that the Tarrant case has called into question. Therefore, if the Supreme Court adopts the position of the Texas Water District in the Tarrant case, the Great Lakes Water Resources Compact could be subject to a challenge by a non-Great Lakes State that was interested in establishing a pipeline from the Great Lakes to an arid out-of-Basin area.

Such an outcome could be like manna from heaven for southern arid States as they might argue like the Water District in the Tarrant case:

” [The strain on western water supplies] makes appropriations by arid western states from water rich neighboring states essential, but by encouraging the ‘tendencies toward economic balkanization’ that the Commerce Clause was intended to prevent, the decision below may make such appropriations effectively impossible. Localities blessed with substantial water reserves now are free, under the Tenth Circuit’s rule, to hoard water while their immediate neighbors go dry.” Pet. at 26.

Clearly, with water supplies becoming more scarce in arid States, they have an increased interest in tapping into States with abundant water resources. We will track this case and provide more information when it becomes available.

The post A Supreme Court Case to Keep an Eye on: Tarrant Regional Water District V Herrmann appeared first on Dawda PLC.

Although the agencies tried to make it a general discussion on oil and gas, the presentation and most of the questions from the audience focused on the controversial topic of fracking….and it was clear the local police and the agencies were prepared for potential trouble as there were six conservation officers and three police cruisers in the parking lot. (A clear difference from other DNR/DEQ presentations I’ve attended in the past!) Despite the controversial topic, decorum was maintained and there were no disturbances.

The issue of fracking has been getting a lot of press recently but companies have been doing it in Michigan in a lesser but somewhat comparable form since 1952. Since that time more than 10,000 fracking wells have been installed in Michigan, mostly in a geological formation called the “Antrim Shale.” Since 1925 a total of 60,000 oil and gas wells have been drilled; of those 4,500 have been for oil, 11,000 have been for gas and 3,000 have been for gas storage.

About 80% of the wells drilled in Michigan (and the U.S.) recently have been fracking wells and the natural (methane) gas produced from those wells have caused the price of natural gas to plummet in the U.S. to $2 per million British thermal units (compared to $10 in the U.K.) According to some analysts (as noted in this recent Washington Post article), this gas boom is fueling a revival in American manufacturing – something we desperately need in this country.

Naturally, this flush of inexpensive gas doesn’t come without weighty public policy issues, and the issues the attendees focused on during last night’s forum are the same being raised elsewhere in the country: contamination of groundwater aquifers and depletion of fresh groundwater.

According to the DEQ, vertical fracking wells use between 50,000 to 100,000 gallons while some horizontal wells (like most of the current wells) can use up to 20 million gallons of water. In comparison, total water withdrawals in Michigan in 2010 amounted to 267 billion gallons. (However, the DEQ admitted that most of the later amount returns to the environment while the millions of gallons of water used in fracking are permanently removed from and never return to the watershed due to the contaminants in it.) Although groundwater used for oil and gas production are exempt from Michigan’s water withdrawal legislation, the Supervisor of Wells issued Well Instruction 1-2011 which allows the DEQ to use Michigan’s water withdrawal assessment tool to determine if a proposed gas well will have an adverse impact on stream flow. If such an impact is identified, the DEQ does not issue a permit.

The DEQ also asserted that claims about “flaming tap water” (as seen on YouTube) due to fracking are false and the instances where it has occurred are not due to the fracturing of bedrock but methane leaking around improper well casings (or methane naturally seeping into an overlying aquifer). According to the DEQ, Michigan’s well casing requirements prevent this from happening. In Michigan, drillers are required to use several corrosion resistant metal casings (conductor, surface, intermediate, and production casings) that are cemented together to seal off the well from the surrounding environment. (A diagram of the typical well is depicted to the right.)gas well

If these requirements are followed, according to the DEQ, the risk of a well contaminating groundwater is very low.

All in all I think the DEQ/DNR did a good job at trying to explain the issues and point out some facts to ameliorate the public’s concerns but I don’t think the issues, especially the water withdrawal issue, will be going away any time soon. As with everything, the goal will be trying to find the right balance.

Additional information about the location and type of wells currently in Michigan can be accessed here and the DEQ’s GIS database (GeoWebFace) of oil and gas related information can be accessed here.

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Michigan residents are paying close attention to gas and pipeline transport issues in the region because of our water resources.

What is the main issue in Michigan? Two words – groundwater withdrawal. Many Michigan rivers and streams are fed by groundwater. With fracking pads using up to 20 million gallons of water, the concern is fracking near waterbodies will result in reducing water levels to a point that fishing and boating will be adversely impacted. Recently, because of local opposition to oil and gas leases along the “Holy Waters” section of the AuSable River, the DNR designated those leases as non-production leases. In addition, the sensitivity of this issue for Michigan residents has prompted the MDEQ to re-evaluate its fracking rules.

Michigan residents are also concerned about oil transport through the Great Lakes region. Companies like Enbridge are building or expanding pipelines in Michigan to handle the increased production of oil elsewhere. There are also plans to build an oil shipping port in Superior Wisconsin so that up to 35,000 barrels (about 1.4 million gallons) of oil from Alberta’s tar sands can be shipped to refineries around the Great Lakes.

As many recall, in 2010 one of Enbridge’s oil pipelines near Marshall, Michigan ruptured spilling over one million gallons (about 24,000 barrels) of diluted bitumen (“dilbit”) oil into the Kalamazoo River – a spill that Enbridge is still cleaning up. While Michigan residents understand the need for oil, they are not interested in a repeat of the Enbridge spill – especially one that would involve one of the Great Lakes.

Although water is abundant around the Great Lakes, it is used by many for recreational purposes in addition to industrial/commercial uses. As a result, there is significant interest and demands for it to be managed so that it can be enjoyed by the greatest number of people.

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