PART 2

Ken Paulson, chief engineer at the province's Oil and Gas Commission, said these events do not pose a contamination risk. Other experts say their principal impact is to undermine production.

But opponents of expanded shale drilling say instances of communication show that drillers lack a full understanding of what happens when wells are fracked closer together, increasing the risk of contamination. Anthony Ingraffea, an engineering professor at Cornell University, said that if a fracture hit a natural fault, it could allow contaminants to enter aquifers.

Communication has occurred in the U.S. as well: Regulators in Texas, Oklahoma, Michigan and Pennsylvania reported such events to Canadian officials as part of the Energy Resources Conservation Board's regulatory review.

Documents provided to ProPublica show that energy companies have reported 25 cases of communication in British Columbia since 2009. Companies are not required to report such events, so the list isn't comprehensive, Paulson said.

In May 2010, the province's Oil and Gas Commission issued a warning when a drilling company inadvertently shot sand from one fracking job into another well being drilled more than 2,000 feet away.

The advisory said the operator contained the resulting jump in pressure within the well but warned of a "potential safety hazard." When communication occurs, Paulson said, the biggest concern is that an operator could lose control of a well and cause a blowout.

Concerns Over Water Consumption

As the debate over communication continues, Parfitt and other Canadian environmentalists have raised more immediate concerns about water use. Fracking requires lots of water -- on their biggest reported fracking job, Apache and Encana used an average of 28 million gallons of water per well.

While the oil and gas industry says it is responsible for 1 percent or less of British Columbia's overall water use, environmental advocates say that may not reflect the full extent of the industry's consumption or long-term needs.

Drillers use both surface and groundwater. Access to surface water is regulated by two agencies that issue long-term licenses or year-long permits. Overwhelmingly, energy companies have chosen to obtain permits, which require less regulatory review.

Most groundwater withdrawals aren't regulated at all. Drillers need permits to sink water wells, but there are no limits on the amount of water that can be taken from them. They can also purchase water from other well owners, so there's no way to track overall use.

"How much water is actually being used and, more importantly, how much water is projected to be used over next the 10 to 15 years? Because of the scattershot approach of regulation, this isn't something we can actually answer right now,"said Matt Horne, acting director of the climate change program at the Pembina Institute, an environmental think tank that published a report on the gas industry's water use.

Last year, in a report focusing on province-wide groundwater oversight, British Columbia's auditor general said the province was not adequately protecting aquifers from overuse and potential contamination. Agencies lacked the basic data necessary to assess the risks, such as the number and extent of the province's aquifers, the report said.

The Ministry of Energy and Mines, in a written response to questions, said the province is taking several steps to improve oversight of water use, including a research project studying aquifers. The agency said it can review large groundwater withdrawal projects and that pending changes to the province's water law would regulate withdrawals.

Drillers themselves are also moving to address water concerns. Encana and Apache have started using saline water not suitable for drinking or irrigation in some of their projects. Alan Boras, the Encana spokesman, said the company uses non-potable water almost exclusively in its main operating area in the Horn River Basin, where the largest frack jobs were reported.

Environmentalists say they welcome the effort, but caution that these projects are tiny compared to the industry's overall water use.

Governments, Industry Get Cozy

Public backlash to fracking has become such a concern for drillers and provincial governments in western Canada that last year they launched a joint effort to counter it.

In December 2010, the governments of British Columbia, Alberta and Saskatchewan signed a memorandum of understanding laying out a plan to share information and develop standards for hydraulic fracturing and water use. The provinces invited only one non-governmental entity to participate in the project: the Canadian Association of Petroleum Producers.

The memo, which was leaked in August and published by the Alberta Federation of Labour, a union group, said the provinces and petroleum producers would work together to develop "key messages" on shale drilling to persuade the public not to fear fracking.

"The project will help to demonstrate that shale gas extraction is viable, safe and environmentally sustainable," the memo said.

The memo blamed environmental groups for spreading misleading information and stirring opposition to drilling.

"Environmental Non-Government organizations (ENGOs) are supporting a ill-informed [sic] campaign on hydraulic fracturing and water related issues in British Columbia and in other jurisdictions," it said. "This is expected to grow as shale gas development expands into Alberta and Saskatchewan."

In a separate memo, Alberta Environment and Water reported that the Canadian Association of Petroleum Producers had approached the province to work on a joint public relations campaign.

Ultimately, no campaign materialized.

Janet Annesley, a spokeswoman for the Canadian Association of Petroleum Producers, said the group hadn't wanted to join forces on PR but was just informing the province of plans to publish voluntary standards for shale gas drilling.

Still, critics saw the memo as proof of an overly cozy relationship between the government and the industry.

Bart Johnson, a spokesman for Alberta's Energy Minister, said the petroleum producers had suggested a joint PR initiative but dropped the request. Such a collaboration, however, would not have been inappropriate, he said. The government works with industry groups all the time, he said, citing a campaign with education groups against bullying in schools.

"Oil and gas is huge in Alberta. It fuels our economy. Indeed it fuels the economy of Canada," Johnson said. "Any suggestion that we shouldn't meet with that industry is ridiculous."

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