TransCanada Corp. via Reuters file

The Keystone XL oil pipeline, pictured under construction Jan. 18, 2012, in North Dakota.

This story has been updated to reflect a correction.

Construction of the controversial Keystone XL pipeline would create "numerous" and "substantial" impacts on the environment, the State Department said Friday in a draft environmental impact statement. But the project is a better bet than any of the alternatives, it said in essentially clearing the project to go ahead.

The report concluded that the Canadian synthetic crude oil the pipeline is slated to transport into the U.S. produces 17 percent more greenhouse gases than natural crude oil already refined here. In addition, it said the construction phase of the project would result in carbon dioxide emissions equiavalent to about 626,000 passenger vehicles operating for a full year.

Without directly saying so, the report signaled the State Department's belief that the pipeline should go ahead, concluding that other modes of transportation would have the same impacts and that proposed alternatives — including an above-ground route and a smaller-diameter pipe — "were not reasonable."

And on a central issue of discussion, it concluded that blocking the pipeline wouldn't make any difference in the U.S.'s high consumption of oil.

Reaction from environmental groups was swift.

"The Sierra Club is outraged by the State Department's deeply flawed analysis today on Keystone XL," the Sierra Club tweeted.

Gene Karpinski, president of the League of Conservation Voters, said the report failed to appreciate the pipeline's potential effect on climate change.

"People who think our climate wouldn't be negatively impacted by Keystone XL have their heads in the (tar) sands," he said in a statement. "... LCV will work to ensure that the millions of Americans opposed to this dangerous pipeline have their voices heard during the comment period and that Keystone XL is rejected once and for all."

But House Speaker John Boehner, R-Ohio, welcomed the report, which he said "makes clear there is no reason for this critical pipeline to be blocked one more day."

"After four years of needless delays, it is time for President Obama to stand up for middle-class jobs and energy security and approve the Keystone pipeline," Boehner said.

The environmental statement is only a draft, not a final decision whether to greenlight the project. A public comment period of 45 days is next.

A final decision on the $5.3 billion pipeline, a project of TransCanada Corp., has been pending for more than four years as environmental activists battle to kill it, contending that it contributes to the U.S.'s dependence on "dirty fuel" that generates higher emissions than crude oil refined in the U.S.

The pipeline would transport synthetic crude oil from oil sands in northeastern Alberta to refineries running along the spine of the U.S. all the way down to Texas. Along the way, the 2,000-page report said, it could also:

• Disturb highly erodible soil along nearly half of the 875-mile U.S. segment — including 4,715 acres of "prime farmland soil."
• Degrade streams and other surface water.
• Encroach on the habitats of 13 federally protected species or species being considered for that designation, including the whooping crane and the greater sage grouse.
• Be susceptible to potentially disastrous leaks and spill.

On the other side of the balance, the report noted the potential for economic development and growth in impoverished communities along the pipeline's pathway, saying it could create about 42,000 jobs during the construction period, about 3,900 of them directly employed in construction activities. The report noted that after construction is completed, the project would generate 35 permanent and 15 temporary jobs, primarily for routine inspections, maintenance and repairs.

President Barack Obama will have the final say on the project, which is being reviewed by the State Department, not the Environmental Protection Agency, because the pipeline would cross national borders. Obama signaled his support for the southern section of the line last year, but he gave environmentalists a measure of hope in January, when he promised to do more to fight climate change in his inaugural address. 

Tens of thousands of protesters jammed the National Mall in Washington on Feb. 17 to urge Obama to reject pipeline. They adopted the slogan "Forward" — cribbing Obama's own campaign slogan.

The final decision will be a crucial one for Canada, which may need to look elsewhere for new energy markets if the pipeline is rejected.

Tom Capra, Catherine Chomiak and Frank Thorp of NBC News contributed to this report. Follow M. Alex Johnson on Twitter and Facebook.

Watch US News videos on NBCNews.com

This story reflects the following correction: This story misstated the State Department's projection of the number of construction jobs the Keystone XL pipeline project would create. The department's draft environmental impact statement said the project could create about 42,000 jobs during the construction period, about 3,900 of them directly employed in construction activities. The report noted that after construction is completed, the project would generate 35 permanent and 15 temporary jobs, primarily for routine inspections, maintenance and repairs.

This story was originally published on Fri Mar 1, 2013 5:50 PM EST

Jonathan Bachman / Reuters

The Superdome field in partial darkness the NFL Super Bowl XLVII in New Orleans, Sunday.

While the reasons for the 34-minute power outage during Sunday’s Super Bowl remain largely unknown, advocates for a smarter energy grid say it is the latest example of why the nation needs desperately to invest in its electricity infrastructure.

The blackout in New Orleans, coupled with the recent prolonged outages in New York and New Jersey caused by Hurricane Sandy, have put on display for the world how vulnerable America can be to losing its lights.  Experts say it is a vulnerability that could have potentially crippling effects.

“The grid has all these parts where accidents can occur, and many accidents have the potential to create widespread problems,” said Susan Tierney, co-author of a National Research Council report that details the flaws in how the country gets its power.

She likened it to the nation’s interstate system, with main arteries and smaller back roads, so interconnected that a problem is rarely isolated.

The National Research Council report, completed in 2007 but declassified by the Department of Homeland Security last November, warns that a coordinated strike on the electric grid could have devastating effects on the American economy and psyche.

The non-partisan report said: "If carried out in a carefully planned way, by people who knew what they were doing, such an attack could deny large regions of the country access to bulk system power for weeks or even months. An event of this magnitude and duration could lead to turmoil, widespread public fear, and an image of helplessness that would play directly into the hands of the terrorists.”

Along with the physical damage and darkness, an attack on the nation’s electrical grid could cause, the biggest impact could be devastating financially, according to Tierney.

“Almost every aspect of our economy is touched by electricity, from banking to hospitals to world markets,” she said. “The worst case scenario could be devastating.”

Aging infrastructure
Like the roads and bridges that make up America’s physical infrastructure, its electrical infrastructure is getting more ancient.

And University of Minnesota Professor Massoud Amin, an expert on the U.S. electrical grid, said our increasingly digital society is only causing more strain.

“You’re dealing with an aging infrastructure that is not made for this century’s demands,” he said.

Amin’s research shows America’s problems with electricity are getting worse. There were 149 power outages that affected at least 50,000 from 2000-2004, a number that rose to 349 from 2005-2009.  

Though questions surround what exactly caused the lights to go out in the Big Easy, Amin said he believes a smarter grid would have prevented the incident.

He advocates for a self-healing infrastructure that can communicate when problems arise, anticipate potential issues and isolate the area where the problem arises.

While energy experts and politicians on both sides of the aisle agree something needs to be done, little has been. 

The U.S. is quickly falling behind European countries in terms of its energy reliability, according to John Kelly, executive director of Galvin Power Initiative, which compares the energy reliability of countries around the world. [PDF link]    

“We’re not improving right now,” said Kelly.

The reason, both Amin and Tierney agree, comes down to unwillingness in both the public and private sector to put in the cash.

To create a smarter grid, money must go into things like research and development, security systems and standardizing equipment to allow defective parts to quickly be swapped out.

Cost savings
With an increasing number of weather-related catastrophes that some have attributed to climate change, time is an even more pressing issue. Money is being spent repairing old electrical lines instead of on new technologies.

A national smart grid could cost up between $338 billion to $476 billion over the next 20 years, according to a 2011 study by the Electric Power Research Institute.

“There is a lot of uncertainty, a lot of stake holders and some major concerns about return on investment,” said Amin. “Filling potholes and putting money into education is seen as a better investment than electric.”

But the director of the University of Minnesota’s Technological Leadership Institute added that much of the investment has been stifled because, by-and-large, Americans are happy with their electrical service.

“It’s not to say the sky is falling,” said Amin. “When these things happen they bother us. The problem we should worry about is when they become more than just a bother.”

TransCanada Corp. via Reuters

The Keystone XL pipeline is pictured under construction in North Dakota in this undated photograph released on Jan. 18

WASHINGTON -- A bipartisan group of senators on Friday urged President Barack Obama to quickly issue a permit for the northern leg of the Keystone XL pipeline, a project environmental groups have vowed to keep fighting.

The senators -- nine Democrats and nine Republicans -- asked Obama to approve the pipeline because it will create jobs and reduce the need for oil from the Middle East. They were led by Max Baucus, a Montana Democrat and powerful chair of the Senate Finance Committee, and John Hoeven, a North Dakota Republican. Both senators represent the booming Bakken oil region.

The pipeline is designed to carry oil from Canada and the Bakken formation and last year, Obama put it on hold citing environmental concerns with a portion of the route in Nebraska. The TransCanada Corp project needs a presidential permit because it would cross an international border.

Nebraska's state government could wrap up its work examining a new route by the end of the year. The State Department is working on a review that the senators hope will affirm the project is in the national interest.

In their letter, the senators urged Obama to issue a permit for the project "immediately afterward."

"Setting politics aside: nothing has changed about the thousands of jobs that Keystone XL will create," the senators said.

"Nothing has changed about the security to be gained from using more fuel produced at home and by a close and stable ally. And nothing has changed about the need for America to remain a place where businesses can still build things," they said.

The pipeline was designed to extend 1,661 miles to the Port Arthur, Texas, area from Hardisty, Alberta, moving 830,000 barrels of oil per day.

The southern leg of the line -- from Cushing, Okla., to Texas refineries -- did not need a special permit and work has already begun on that part.  

The senators' letter comes just ahead of a large protest against the pipeline planned for the White House on Sunday by environmental groups.

Last year, similar protests drew thousands of people, and some 1,200 opponents were arrested. The protests were credited with slowing the State Department's review of what once was thought to be a routine regulatory approval.

"Keystone XL is still a crazy idea, a giant straw into the second biggest pool of carbon," said a coalition including 350.org, the Sierra Club, Greenpeace US, and Friends of the Earth, urging its members to attend.

"No one needs to get arrested this time — though that may come as the winter wears on. For now we simply need to let the president know we haven't forgotten, and that our conviction hasn't cooled," the groups said.

The timing and design of the senators' letter is aimed at reminding Obama of public support for the project, Hoeven said in an interview.

"We're concerned that the last time opponents demonstrated around the White House, at a time when it looked like State was ready to approve the project, the administration deferred it," Hoeven said.

Congress has repeatedly pushed Obama to approve the project. Last December, Republicans inserted language in a payroll tax cut bill giving Obama a 60-day deadline to make a decision.

In January, he ruled the administration needed more time to evaluate a change in the route through Nebraska, aimed at avoiding a sensitive environmental region.

Republicans accused him of playing to the environmental movement ahead of the election. In Congress, proponents pushed to override Obama's call and approve the pipeline themselves, but a vote in the Senate fell four votes short of passage.

Republican presidential candidate Mitt Romney raised the issue as gasoline prices surged, pledging he would approve the pipeline on his first day in office.

Obama has said he supports the jobs created by the U.S. boom in oil production, and backed the southern leg of the project earlier this year. But he has also pledged to address climate change, which environmental groups argue would be accelerated by more development of Canada's oil sands.

Both green groups and the oil industry see Obama's pipeline decision as a test of his political priorities.

"I really feel if he doesn't approve it, that would just create more momentum in the Congress for us to approve it ourselves," said Hoeven, who championed last year's close vote in the Senate to fast-track the pipeline.

Analysts have said they think Obama eventually will approve the pipeline but the timing of the decision is in question. 

"Approval will not be quick," Moody's credit rating agency said in an outlook for investors earlier this week.

Republican Rep. Lee Terry also wrote Obama on Friday, saying he is worried additional delays by the State Department could lead Canada to look for other oil buyers.

"Will the United States be a partner and recipient or will the vast majority of the resource be sold to China or some other country," said Terry, a Nebraskan who led efforts in the House of Representatives to fast-track the pipeline.

Nebraska's Department of Environmental Quality is wrapping up its review with a public meeting on December 4. Governor Dave Heineman must then approve the project, something oil industry groups said expect by early January.

Meanwhile, the U.S. State Department, which oversees the administration's review, is preparing a supplemental environmental impact statement.

"When the SEIS is completed in draft form, we will release it for public comment consistent with NEPA," the National Environmental Policy Act, said a State Department official, who did not say how long the comment period would be.

The report will help the State Department determine whether the project is in the national interest, a decision it makes in consultation with other administration officials, considering issues such as climate change concerns and jobs.

The State Department has said it does not anticipate concluding its work before the first quarter of 2013.

“Environmentalists punish companies without protecting people” is the headline of a column that appeared on the website of the American Action Forum a year ago.

The group has called for increased domestic production of oil, coal and natural gas. Officials there have criticized President Barack Obama’s “eagerness to speed our progression to a low-carbon economy” and argued that the administration is “regulating coal out of existence.”

The American Action Forum is also connected with a nonprofit and a super PAC that have spent millions of dollars on ads backing anti-regulation Republican candidates since 2010.

So why did the Energy Foundation, a San Francisco-based organization that funds the Sierra Club, the National Resources Defense Council, the Environmental Defense Fund and Earthjustice give the conservative nonprofit a six-figure donation last year?

Records obtained by the Center for Public Integrity show that the Energy Foundation, touted as the “leading funder of projects that address climate change,” awarded the American Action Forum a $125,000 grant in 2011 for “high-level outreach and communications around carbon policy.”

Jenny Coyle, a spokeswoman for the Energy Foundation, says her organization is “proud to fund a wide variety of organizations whether they are viewed as progressive or conservative.”

“Clean energy is not a partisan issue,” Coyle continued. “We believe that all demographics and groups will see the benefits of a prosperous and healthy clean energy economy.”

Officials at the American Action Forum declined to comment about the grant.

Center for Public Integrity: Donation tough to figure 

According to records filed with the Internal Revenue Service, the Energy Foundation doled out more than $97 million in grants in 2010 to projects aimed at the adoption of stronger fuel efficiency standards for vehicles, the promotion of renewable energy technologies and the retirement of existing coal-fired power plants, among others.

Against that backdrop, the American Action Forum stands out as an unlikely beneficiary.

The group is not known as an environmental advocate. One of its projects tracks coal plants in the U.S. that are likely to close down under the Obama administration’s new “regulatory burdens.”

American Action Forum’s president is Douglas Holtz-Eakin, who headed the Congressional Budget Office under President George W. Bush, served as top adviser to 2008 GOP presidential nominee John McCain and has had stints as a visiting fellow at the conservative Heritage Foundation and the American Enterprise Institute. Its board includes former Nixon operative Fred Malek, former GOP Sen. Norm Coleman of Minnesota, former GOP Gov. Tom Ridge of Pennsylvania and former GOP Gov. Jeb Bush of Florida.

Craig Holman, a lobbyist for the consumer group Public Citizen — which has also received grants from the Energy Foundation — says the American Action Forum “is not dedicated to clean energy.”

He says the group favors deregulation and ending federal subsidies for renewable energy technologies that would tilt the playing field toward “established, traditional dirty sources of energy.”

Catrina Rorke, the director of energy policy at the American Action Forum, argues that federal subsidies “are not the best tool to integrate new fuels into the market.”

“We don’t want to preferentially support one kind of energy over another,” Rorke said.

Organized under section 501(c)(3) of the U.S. tax code, American Action Forum is focused on policy research and is affiliated with the American Action Network, which engages in advocacy as a “social welfare” group organized under section 501(c)(4) of the Internal Revenue Code.

The groups are also linked to a super PAC called the Congressional Leadership Fund.

All three organizations share office space and personnel, with Coleman and Malek playing leadership roles in each.

Malek founded both the American Action Network, where he is still a board member, and the American Action Forum, where he serves as chairman of the board. He also is a board member of the Congressional Leadership Fund.

Coleman, meanwhile, is a board member of the American Action Forum and is the chairman of both the American Action Network and the Congressional Leadership Fund.

Veteran GOP operative Brian Walsh — who served as the National Republican Congressional Committee’s political director during the 2010 election cycle — is the president of both the American Action Network and Congressional Leadership Fund, which have run a plethora of attack ads against Democrats.

Records filed with the Federal Election Commission show that during the 2010 election cycle alone, American Action Network reported spending more than $18 million on political advertisements — more than any other “social welfare” nonprofit, according to the Center for Responsive Politics.

In this fall’s hotly contested race in Minnesota’s 8th District, it has attacked Democrat Rick Nolan for siding with the Environmental Protection Agency against a mining company. Nolan’s campaign has said the former congressman will support the mining industry “without rolling back environmental and safety regulations for workers."

Similarly, in the highly competitive race in Ohio’s 16th District, the Congressional Leadership Fund has spent more than $1 million on ads blasting Democratic Rep. Betty Sutton. Among the reasons given to oppose Sutton in November? Her vote during the 111th Congress in support of the so-called “cap-and-trade” legislation, which sought to establish both a cap on carbon emissions and a requirement that large utilities in each state increase the percentage of electricity they produce from renewable sources.

Donors to the Congressional Leadership Fund include Alpha Natural Resources, one of the country’s leading producers of coal, which made a $5,000 donation from its corporate treasury in April.

According to the Center for Responsive Politics, the Congressional Leadership Fund has also received contributions from the political action committees connected to the Nuclear Energy Institute, the Edison Electric Institute, energy conglomerate Koch Industries, oil refining giant Valero Energy and Exelon, which is the largest nuclear power plant operator in the U.S. and last year was awarded a $646 million loan guarantee by the Department of Energy for one of its solar generation subsidiaries.

Super donors Sheldon Adelson, the billionaire casino owner from Nevada, and Bob Perry, the millionaire home builder from Texas, have both given generously to the Congressional Leadership Fund.

Neither American Action Forum nor American Action Network is required to publicly disclose donor information.

A review of IRS filings by the Center for Responsive Politics, however, found that donors to the American Action Network include the Republican Jewish Coalition, the American Natural Gas Alliance and Crossroads GPS, the nonprofit sister organization of conservative super PAC juggernaut American Crossroads.

The Center for Public Integrity is a nonprofit independent Investigative news outlet. 

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Ingo Wagner / Reuters

Offshore wind turbines are seen in Germany's North Sea, along with a service platform that doubles as a transformer sending electricity to the mainland. Germany and Denmark are leaders in the offshore wind industry.

Placing wind turbines off the East Coast could meet the entire demand for electricity from Florida to Maine, according to engineering experts at Stanford University.

It would require 144,000 offshore turbines standing 270 feet tall — not one of which exists since proposals have stalled due to controversy and costs. But the analysis shows it's doable and where the best locations are, says study co-author Mark Jacobson, a Stanford professor of civil and environmental engineering.

The team is not advocating for an "all wind" approach, saying it'd be foolish to put all of one's energy eggs in a single basket, but they do think it could reach up to 50 percent. Today the U.S. gets about 4 percent of its electricity from wind, but only via turbines on land.

The first large-scale offshore wind farm was proposed in 2001 off Massachusetts' Nantucket Island. But vocal opposition, including from political heavyweights like the Kennedy family, are seeking to block the $2.6 billion Cape Wind project, arguing the 130 massive turbines would mar views and endanger boat and air traffic.

"The question that I would first ask" critics, Jacobson told NBC News, "is would they rather have a coal or natural power gas plant in their neighborhood, which affects their health and that of their children as well as their quality of life and property values, or an innocuous turbine that they could barely see during those times when they were actually looking offshore."

For the analysis published in the journal Wind Energy, Jacobson's team created a computer model with 144,000 wind turbines that produce 5 megawatts of electricity each, similar to the turbines installed off Denmark and Germany. They then plugged in historical wind speed data to come up with estimates.

A. Baseden / AP

Map shows site of proposed wind farm near Cape Cod.

They also favored places with lower hurricane risk, essentially excluding any area south of Virginia.

The best locations are "way out of sight" from coastlines, Jacobson said, and the worst-case scenarios would be distant views of turbines about the size of one's extended thumb.

"The only place with significant opposition to offshore wind that I am aware of has been in Nantucket," he added. "There are dozens of other proposals in the U.S. that have not faced nearly the same extent of opposition."

Cape Wind does have federal approval, as well as support from major national environmental groups, and hopes to begin building turbines next year. But opposition groups like Alliance to Protect Nantucket Sound are still battling the project in court and before federal agencies.

Cape Wind

Cape Wind created this simulated photo to show what it says would be the view of its wind farm from Nantucket Island. The distance out to the turbines, seen as white dots on the horizon, is 13 miles.

A further limitation is cost. Cape Wind, for one, is still working on financing, and cheaper natural gas has taken some of the shine off wind, at least in investors' eyes. Moreover, installation offshore currently costs two to three times more than land-based turbines.

Jacobson's team says the new study will help locate the most economically feasible sites, particularly around New York and Boston when peak demand for electricity can send prices soaring.

"Connecting the power to the grid would be technically as easy as laying a cable in the sand and hooking it directly into the grid without the need to build often controversial transmission lines on the land," said Mike Dvorak, the principle author of the study.

He also noted that offshore wind has an advantage over land-based wind turbines.

"People mistakenly think that wind energy is not useful because output from most land-based turbines peaks in the late evening/early morning, when electricity demand is low," Dvorak said. "The real value of offshore wind energy is that it often peaks when we need the most electricity — during the middle of the day."

Besides reducing pollution and increasing domestic energy resources, wind has a key advantage over natural gas or coal, Jacobson notes. That's price stability.

"There's zero fuel costs once they're in the water," he said. "Coal and gas are depletable resources, so their cost will inevitably go up over time. The cost of wind energy will remain stable, and the wind resource is infinite."

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Capt. Kristjan B. Laxfoss via AP

A Shell drilling ship drifts near shore on Unalaska Island, Alaska, on July 14. ship lost its mooring but did not ground and was not damaged, the Coast Guard said.

The first drilling in Arctic waters off Alaska later this summer is being curtailed, Shell said Tuesday. The company focused on the ongoing presence of sea ice, while environmentalists pointed to the fact that Shell has yet to get certification for its spill containment system. 

Shell had planned to drill five exploration wells this summer but now will aim for two as well as additional "top hole" locations, "meaning we will begin new wells which can be completed in 2013," Shell spokeswoman Kelly op de Weegh told NBC News.

"We have continued to be delayed by the sea ice in place, and while the ice is just now beginning to clear near one of our locations, we are still monitoring for ice to clear elsewhere," she added.

"If the ice had been cleared, we would be awaiting final testing and certification of the containment barge,' she said.

The containment system was being tested Tuesday and later in the week, she said, adding that "we feel very good about the progress we’ve made."

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The drilling will be in the Beaufort and Chukchi Seas. Thick Chukchi sea ice stands in contrast to thin ice or wide-open seas in other parts of the Arctic.

Shell hopes drilling the "top holes" will allow it to get back on track and still have 10 wells drilled by the end of summer in 2013.

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Shell suffered another setback in Dutch Harbor, Alaska, earlier this month when one of its exploration ships, the Discoverer, drifted toward shore and nearly grounded.

Drilling opponents say the recent problems show why Shell's plans are too risky.

"As Shell Oil continues to push to drill exploratory wells in our Arctic Ocean this summer, the oil giant is giving us a preview of how disastrous a situation this could be," Kristen Miller of the Alaska Wilderness League said in a statement. 

Greenpeace USA questioned whether the mooring system in Shell's barge would be safe. "If the Coast Guard certifies this barge with a mooring system that can’t withstand strong storms, how will Shell handle an oil spill during such a storm," asked Jackie Dragon, the group's lead Arctic campaigner.

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Abrahm Lustgarten / ProPublica

This class 2 brine disposal well in western Louisiana, near the Texas border, is among the 680,000 waste and injection wells across the U.S.

Over the past several decades, U.S. industries have injected more than 30 trillion gallons of toxic liquid deep into the earth, using broad expanses of the nation's geology as an invisible dumping ground.

No company would be allowed to pour such dangerous chemicals into the rivers or onto the soil. But until recently, scientists and environmental officials have assumed that deep layers of rock beneath the earth would safely entomb the waste for millenia. 

There are growing signs they were mistaken.

Records from disparate corners of the United States show that wells drilled to bury this waste deep beneath the ground have repeatedly leaked, sending dangerous chemicals and waste gurgling to the surface or, on occasion, seeping into shallow aquifers that store a significant portion of the nation's drinking water.

In 2010, contaminants from such a well bubbled up in a west Los Angeles dog park. Within the past three years, similar fountains of oil and gas drilling waste have appeared in Oklahoma and Louisiana. In South Florida, 20 of the nation's most stringently regulated disposal wells failed in the early 1990s, releasing partly treated sewage into aquifers that may one day be needed to supply Miami's drinking water.

There are more than 680,000 underground waste and injection wells nationwide, more than 150,000 of which shoot industrial fluids thousands of feet below the surface. Scientists and federal regulators acknowledge they do not know how many of the sites are leaking.

Federal officials and many geologists insist that the risks posed by all this dumping are minimal. Accidents are uncommon, they say, and groundwater reserves — from which most Americans get their drinking water — remain safe and far exceed any plausible threat posed by injecting toxic chemicals into the ground.

But in interviews, several key experts acknowledged that the idea that injection is safe rests on science that has not kept pace with reality, and on oversight that doesn't always work.

"In 10 to 100 years we are going to find out that most of our groundwater is polluted," said Mario Salazar, an engineer who worked for 25 years as a technical expert with the EPA's underground injection program in Washington. "A lot of people are going to get sick, and a lot of people may die."

The boom in oil and natural gas drilling is deepening the uncertainties, geologists acknowledge. Drilling produces copious amounts of waste, burdening regulators and demanding hundreds of additional disposal wells. Those wells — more holes punched in the ground — are changing the earth's geology, adding man-made fractures that allow water and waste to flow more freely.

"There is no certainty at all in any of this, and whoever tells you the opposite is not telling you the truth,' said Stefan Finsterle, a leading hydrogeologist at Lawrence Berkeley National Laboratory who specializes in understanding the properties of rock layers and modeling how fluid flows through them. "You have changed the system with pressure and temperature and fracturing, so you don't know how it will behave."

CNBC reports on fracking pros and cons

A ProPublica review of well records, case histories and government summaries of more than 220,000 well inspections found that structural failures inside injection wells are routine. From late 2007 to late 2010, one well integrity violation was issued for every six deep injection wells examined — more than 17,000 violations nationally. More than 7,000 wells showed signs that their walls were leaking. Records also show wells are frequently operated in violation of safety regulations and under conditions that greatly increase the risk of fluid leakage and the threat of water contamination.

Structurally, a disposal well is the same as an oil or gas well. Tubes of concrete and steel extend anywhere from a few hundred feet to two miles into the earth. At the bottom, the well opens into a natural rock formation. There is no container. Waste simply seeps out, filling tiny spaces left between the grains in the rock like the gaps between stacked marbles.

Many scientists and regulators say the alternatives to the injection process — burning waste, treating wastewater, recycling, or disposing of waste on the surface — are far more expensive or bring additional environmental risks.

Subterranean waste disposal, they point out, is a cornerstone of the nation's economy, relied on by the pharmaceutical, agricultural and chemical industries. It's also critical to a future less dependent on foreign oil: Hydraulic fracturing, "clean coal" technologies, nuclear fuel production, and carbon storage (the keystone of the strategy to address climate change) all count on pushing waste into rock formations below the earth's surface.

The U.S. Environmental Protection Agency, which has primary regulatory authority over the nation's injection wells, would not discuss specific well failures identified by ProPublica or make staffers available for interviews. The agency also declined to answer many questions in writing, though it sent responses to several. Its director for the Drinking Water Protection Division, Ann Codrington, sent a statement to ProPublica defending the injection program's effectiveness.

"Underground injection has been and continues to be a viable technique for subsurface storage and disposal of fluids when properly done," the statement said. "EPA recognizes that more can be done to enhance drinking water safeguards and, along with states and tribes, will work to improve the efficiency of the underground injection control program."

Still, some experts see the well failures and leaks discovered so far as signs of broader problems, raising concerns about how much pollution may be leaking out undetected. By the time the damage is discovered, they say, it could be irreversible.

"Are we heading down a path we might regret in the future?" said Anthony Ingraffea, a Cornell University engineering professor who has been an outspoken critic of claims that wells don't leak. "Yes."

***

In September 2003, Ed Cowley got a call to check out a pool of briny water in a bucolic farm field outside Chico, Texas. Nearby, he said, a stand of trees had begun to wither, their leaves turning crispy brown and falling to the ground.

Chico, a town of about 1,000 people 50 miles northwest of Fort Worth, lies in the heart of Texas' Barnett Shale. Gas wells dot the landscape like mailboxes in suburbia. A short distance away from the murky pond, an oil services company had begun pumping millions of gallons of drilling waste into an injection well.

Regulators refer to such waste as salt water or brine, but it often includes less benign contaminants, including fracking chemicals, benzene and other substances known to cause cancer.

The well had been authorized by the Railroad Commission of Texas, which once regulated railways but now oversees 260,000 oil and gas wells and 52,000 injection wells. (Another agency, the Texas Commission on Environmental Quality, regulates injection wells for waste from other industries.)

Before issuing the permit, commission officials studied mathematical models showing that waste could be safely injected into a sandstone layer about one-third of a mile beneath the farm. They specified how much waste could go into the well, under how much pressure, and calculated how far it would dissipate underground. As federal law requires, they also reviewed a quarter-mile radius around the site to make sure waste would not seep back toward the surface through abandoned wells or other holes in the area.

Yet the precautions failed. "Salt water" brine migrated from the injection site and shot back to the surface through three old well holes nearby.

"Have you ever seen an artesian well?" recalled Cowley, Chico's director of public works. "It was just water flowing up out of the ground."

Despite residents' fears that the injected waste could be making its way towards their drinking water, commission officials did not sample soil or water near the leak.

If the injection well waste "had threatened harm to the ground water in the area, an in-depth RRC investigation would have been initiated," Ramona Nye, a spokeswoman for Texas' Railroad Commission, wrote in an email.

The agency disputes Cowley's description of a pool of brine or of dead trees, saying that the waste barely spilled beyond the overflowing wells, though officials could not identify any documents or staffers who contradicted Cowley's recollections. Accounts similar to Cowley's appeared in an article about the leak in the Wise County Messenger, a local newspaper. The agency has destroyed its records about the incident, saying it is required to keep them for only two years.

After the breach, the commission ordered two of the old wells to be plugged with cement and restricted the rate at which waste could be injected into the well. It did not issue any violations against the disposal company, which had followed Texas' rules, regulators said. The commission allowed the well operator to continue injecting thousands of barrels of brine into the well each day. A few months later, brine began spurting out of three more old wells nearby.

"It's kind of like Whac-a-Mole, where one thing pops up and by the time you go to hit it, another thing comes up," Cowley said. "It was frustrating. ... If your water goes, what does that do to the value of your land?"

Deep well injection takes place in 32 states, from Pennsylvania to Michigan to California. Most wells are around the Great Lakes and in areas where oil and gas is produced: along the Appalachian crest and the Gulf Coast, in California and in Texas, which has more wells for hazardous industrial waste and oil and gas waste than any other state.

Federal rules divide wells into six classes based on the material they hold and the industry that produced it. Class 1 wells handle the most hazardous materials, including fertilizers, acids and deadly compounds such as asbestos, PCBs and cyanide. The energy industry has its own category, Class 2, which includes disposal wells and wells in which fluids are injected to force out trapped oil and gas. The most common wells, called Class 5, are a sort of catch-all for everything left over from the other categories, including storm-water runoff from gas stations.

The EPA requires that Class 1 and 2 injection wells be drilled the deepest to assure that the most toxic waste is pushed far below drinking water aquifers. Both types of wells are supposed to be walled with multiple layers of steel tubing and cement and regularly monitored for cracks.

Officials' confidence in this manner of disposal stems not only from safety precautions, but from an understanding of how rock formations trap fluid.

Underground waste, officials say, is contained by layer after layer of impermeable rock. If one layer leaks, the next blocks the waste from spreading before it reaches groundwater. The laws of physics and fluid dynamics should ensure that the waste can't spread far and is diluted as it goes.

The layering "is a very strong phenomenon and it's on our side," said Susan Hovorka, a senior research scientist at the University of Texas at Austin's Bureau of Economic Geology.

According to risk analyses cited in EPA documents, a significant well leak that leads to water contamination is highly unlikely — on the order of one in a million.

Once waste is underground, though, there are few ways to track how far it goes, how quickly or where it winds up. There is plenty of theory, but little data to prove the system works.

"I do think the risks are low, but it has never been adequately demonstrated," said John Apps, a leading geoscientist who advises the Department of Energy for Lawrence Berkeley National Labs. "Every statement is based on a collection of experts that offer you their opinions. Then you do a scientific analysis of their opinions and get some probability out of it. This is a wonderful way to go when you don't have any evidence one way or another... But it really doesn't mean anything scientifically."

The hard data that does exist comes from well inspections conducted by federal and state regulators, who can issue citations to operators for injecting illegally, for not maintaining wells, or for operating wells at unsafe pressures. This information is the EPA's primary means of tracking the system's health on a national scale.

ProPublica's series on injection wells

Yet, in response to questions from ProPublica, the EPA acknowledged it has done very little with the data it collects. The agency could not provide ProPublica with a tally of how frequently wells fail or of how often disposal regulations are violated. It has not counted the number of cases of waste migration or contamination in more than 20 years. The agency often accepts reports from state injection regulators that are partly blank, contain conflicting figures or are missing key details, ProPublica found.

In 2007, the EPA launched a national data system to centralize reports on injection wells. As of September 2011 — the last time the EPA issued a public update — less than half of the state and local regulatory agencies overseeing injection were contributing to the database. It contained complete information from only a handful of states, accounting for a small fraction of the deep wells in the country.

The EPA did not respond to questions seeking more detail about how it handles its data, or about how the agency judges whether its oversight is working.

In a 2008 interview with ProPublica, one EPA scientist acknowledged shortcomings in the way the agency oversees the injection program.

"It's assumed that the monitoring rules and requirements are in place and are protective — that's assumed," said Gregory Oberley, an EPA groundwater specialist who studies injection and water issues in the Rocky Mountain region. "You're not going to know what's going on until someone's well is contaminated and they are complaining about it."

***

ProPublica's analysis of case histories and EPA data from October 2007 to October 2010 showed that when an injection well fails, it is most often because of holes or cracks in the well structure itself.

Operators are required to do so-called "mechanical integrity" tests at regular intervals, yearly for Class 1 wells and at least once every five years for Class 2 wells. In 2010, the tests led to more than 7,500 violations nationally, with more than 2,300 wells failing. In Texas, one violation was issued for every three Class 2 wells examined in 2010.

Such breakdowns can have serious consequences. Damage to the cement or steel casing can allow fluids to seep into the earth, where they could migrate into water supplies.

Regulators say redundant layers of protection usually prevent waste from getting that far, but EPA data shows that in the three years analyzed by ProPublica, more than 7,500 well test failures involved what federal water protection regulations describe as "fluid migration" and "significant leaks."

In September 2009, workers for Unit Petroleum Company discovered oil and gas waste in a roadside ditch in southern Louisiana. After tracing the fluid to a crack in the casing of a nearby injection well, operators tested the rest of the well. Only then did they find another hole — 600 feet down, and just a few hundred feet away from an aquifer that is a source of drinking water for that part of the state.

Most well failures are patched within six months of being discovered, EPA data shows, but with as much as five years passing between integrity tests, it can take a while for leaks to be discovered. And not every well can be repaired. Kansas shut down at least 47 injection wells in 2010, filling them with cement and burying them, because their mechanical integrity could not be restored. Louisiana shut down 82. Wyoming shut down 144.

Another way wells can leak is if waste is injected with such force that it accidentally shatters the rock meant to contain it. A report published by scientists at the Department of Energy's Pacific Northwest National Laboratory and the University of Texas said that high pressure is "the driving force" that can help connect deep geologic layers with shallower ones, allowing fluid to seep through the earth.

Most injection well permits strictly limit the maximum pressure allowed, but well operators — rushing to dispose of more waste in less time — sometimes break the rules, state regulatory inspections show. According to data provided by states to the EPA, deep well operators have been caught exceeding injection pressure limits more than 1,100 times since 2008. 

Excessive pressure factored into a 1989 well failure that yielded new clues about the risks of injection.

While drilling a disposal well in southern Ohio, workers for the Aristech Chemical Corp. (since bought by Sunoco, and sold again, in 2011, to Haverhill Chemicals) were overwhelmed by the smell of phenol, a deadly chemical the company had injected into two Class 1 wells nearby. Somehow, perhaps over decades, the pollution had risen 1,400 feet through solid rock and was progressing toward surface aquifers.

Ohio environmental officials – aided by the EPA – investigated for some 15 years. They concluded that the wells were mechanically sound, but Aristech had injected waste into them faster and under higher pressure than the geologic formation could bear.

Though scientists maintain that the Aristech leak was a rarity, they acknowledge that such problems are more likely in places where industrial activity has changed the underground environment.

There are upwards of 2 million abandoned and plugged oil and gas wells in the U.S., more than 100,000 of which may not appear in regulators’ records. Sometimes they are just broken off tubes of steel, buried or sticking out of the ground. Many are supposed to be sealed shut with cement, but studies show that cement breaks down over time, allowing seepage up the well structure.  

Also, if injected waste reaches the bottom of old wells, it can quickly be driven back towards aquifers, as it was in Chico.

“The United States looks like a pin cushion,” said Bruce Kobelski, a geologist who has been with the agency’s underground injection program since 1986. Kobelski spoke to ProPublica in May, 2011, before the EPA declined additional interview requests for this story. “Unfortunately there are cases where someone missed a well or a well wasn’t indicated. It could have been a well from the turn of the [20th] century.”

Clefts left after the earth is cracked open to frack for oil and gas also can connect abandoned wells and waste injection zones. How far these man-made fissures go is still the subject of research and debate, but in some cases they have reached as much as a half-mile, even intersecting fractures from neighboring wells.

When injection wells intersect with fracked wells and abandoned wells, the combined effect is that many of the natural protections assumed to be provided by deep underground geology no longer exist.

“It’s a natural system and if you go in and start punching holes through it and changing pressure systems around, it’s no longer natural,” said Nathan Wiser, an underground injection expert working for the EPA in its Rocky Mountain region, in a 2010 interview. “It’s difficult to know how it would behave in those circumstances.”

EPA data provides a window into some injection well problems, but not all. There is no way to know how many wells have undetected leaks or to measure the amount of waste escaping from them.

In at least some cases, records obtained by ProPublica show, well failures may have contaminated sources of drinking water. Between 2008 and 2011, state regulators reported 150 instances of what the EPA calls "cases of alleged contamination," in which waste from injection wells purportedly reached aquifers. In 25 instances, the waste came from Class 2 wells. The EPA did not respond to requests for the results of investigations into those incidents or to clarify the standard for reporting a case.

The data probably understates the true extent of such incidents, however.

Leaking wells can simply go undetected. One Texas study looking for the cause of high salinity in soil found that at least 29 brine injection wells in its study area were likely sending a plume of salt water up into the ground unnoticed. Even when a problem is reported, as in Chico, regulators don’t always do the expensive and time-consuming work necessary to investigate its cause.

“The absence of episodes of pollution can mean that there are none, or that no one is looking,” said Salazar, the EPA’s former injection expert. “I would tend to believe it is the latter.”

***

The practice of injecting waste underground arose as a solution to an environmental crisis.

In the first half of the 20th century, toxic waste collected in cesspools, or was dumped in rivers or poured onto fields. As the consequences of unbridled pollution became unacceptable, the country turned to an out-of-sight alternative. Drawing on techniques developed by the oil and gas industry, companies started pumping waste back into wells drilled for resources. Toxic waste became all but invisible. Air and water began to get cleaner. 

Then a host of unanticipated problems began to arise.

In April, 1967 pesticide waste injected by a chemical plant at Denver’s Rocky Mountain Arsenal destabilized a seismic fault, causing a magnitude 5.0 earthquake -- strong enough to shatter windows and close schools -- and jolting scientists with newfound risks of injection, according to the U.S. Geological Survey.

A year later, a corroded hazardous waste well for pulping liquor at the Hammermill Paper Co., in Erie, Pa., ruptured. Five miles away, according to an EPA report, “a noxious black liquid seeped from an abandoned gas well” in Presque Isle State Park.

In 1975 in Beaumont, Texas, dioxin and a highly acidic herbicide injected underground by the Velsicol Chemical Corp. burned a hole through its well casing, sending as much as five million gallons of the waste into a nearby drinking water aquifer.

Then in August 1984 in Oak Ridge, Tenn., radioactive waste was turned up by water monitoring near a deep injection well at a government nuclear facility. 

Regulators raced to catch up. In 1974, the Safe Drinking Water Act was passed, establishing a framework for regulating injection. Then, in 1980, the EPA set up the tiered classes of wells and began to establish basic construction standards and inspection schedules. The EPA licensed some state agencies to monitor wells within their borders and handled oversight jointly with others, but all had to meet the baseline requirements of the federal Underground Injection Control program.

Even with stricter regulations in place, 17 states – including Alabama, North Carolina, South Carolina and Wisconsin -- banned Class 1 hazardous deep well injection.

“We just felt like based on the knowledge that we had at that time that it was not something that was really in the best interest of the environment or the state,” said James Warr, who headed Alabama’s Department of Environmental Management at the time.

Injection accidents kept cropping up.

A 1987 General Accountability Office review put the total number of cases in which waste had migrated from Class 1 hazardous waste wells into underground aquifers at 10 -- including the Texas and Pennsylvania sites. Two of those aquifers were considered potential drinking water sources.

In 1989, the GAO reported 23 more cases in seven states where oil and gas injection wells had failed and polluted aquifers. New regulations had done little to prevent the problems, the report said, largely because most of the wells involved had been grandfathered in and had not had to comply with key aspects of the rules.

Noting four more suspected cases, the report also suggested there could be more well failures, and more widespread pollution, beyond the cases identified. “The full extent to which injected brines have contaminated underground sources of drinking water is unknown,” it stated.

The GAO concluded that most of the contaminated aquifers could not be reclaimed because fixing the damage was “too costly” or “technically infeasible.”

Faced with such findings, the federal government drafted more rules aimed at strengthening the injection program. The government outlawed certain types of wells above or near drinking water aquifers, mandating that most industrial waste be injected deeper.

The agency also began to hold companies that disposed of hazardous industrial waste to far stiffer standards. To get permits to dispose of hazardous waster after 1988, companies had to prove – using complex models and geological studies -- that the stuff they injected wouldn’t migrate anywhere near water supplies for 10,000 years. They were already required to test for fault zones and to conduct reviews to ensure there were no conduits for leakage, such as abandoned wells, within a quarter-mile radius. Later, that became a two-mile minimum radius for some wells. 

The added regulations would have prevented the vast majority of the accidents that occurred before the late 1980s, EPA officials contend. 

“The requirements weren’t as rigorous, the testing wasn’t as rigorous and in some cases the shallow aquifers were contaminated,” Kobelski said. “The program is not the same as it was when we first started.”

Today’s injection program, however, faces a new set of problems.

As federal regulators toughened rules for injecting hazardous waste, oil and gas companies argued that the new standards could drive them out of business. State oil and gas regulators pushed back against the regulations, too, saying that enforcing the rules for Class 2 wells – which handle the vast majority of injected waste by volume -- would be expensive and difficult.

Ultimately, the energy industry won a critical change in the federal government’s legal definition of waste: Since 1988, all material resulting from the oil and gas drilling process is considered non-hazardous, regardless of its content or toxicity.

“It took a lot of talking to sell the EPA on that and there are still a lot of people that don’t like it,” said Bill Bryson, a geologist and former head of the Kansas Corporation Commission’s Conservation Division, who lobbied for and helped draft the federal rules. “But it seemed the best way to protect the environment and to stop everybody from just having to test everything all the time.”

The new approach removed many of the constraints on the oil and gas industry. They were no longer required to conduct seismic tests (a stricture that remained in place for Class 1 wells). Operators were allowed to test their wells less frequently for mechanical integrity and the area they had to check for abandoned wells was kept to a minimum  – one reason drilling waste kept bubbling to the surface near Chico.

Soon after the first Chico incident, Texas expanded the area regulators were required to check for abandoned waste wells (a rule that applied only to certain parts of the state). Doubling the radius they reviewed in Chico to a half mile, they found 13 other injection or oil and gas wells. When they studied the land within a mile – the radius required for review of many Class 1 wells – officials discovered another 35 wells, many dating to the 1950s.

The Railroad Commission concluded that the Chico injection well had overflowed: The target rock zone could no longer handle the volume being pushed into it. Trying to cram in more waste at the same speed could cause further leaks, regulators feared. The commission set new limits on how fast the waste could be injected, but did not forbid further disposal. The well remains in use to this day.  

In late 2008, samples of Chico’s municipal drinking water were found to contain radium, a radioactive derivative of uranium and a common attribute of drilling waste. The water well was a few miles away from the leaking injection well site, but environmental officials said the contaminants discovered in the water well were unrelated, mostly because they didn’t include the level of sodium typical of brine.

Since then, Ed Cowley, the public works director, said commission officials have continued to assure him that brine won’t reach Chico’s drinking water. But since the agency keeps allowing more injection and doesn’t track the cumulative volume of waste going into wells in the area, he’s skeptical that they can keep their promise.

“I was kind of like, ‘You all need to get together and look at the total amount you are trying to fit through the eye of the needle,’” he said.  

***

When sewage flowed from 20 Class 1 wells near Miami into the Upper Floridan aquifer, it challenged some of scientists’ fundamental assumptions about the injection system.

The wells – which had helped fuel the growth of South Florida by eliminating the need for expensive water treatment plants -- had passed rigorous EPA and state evaluation throughout the 1980s and 1990s. Inspections showed they were structurally sound. As Class 1 wells, they were subject to some of the most frequent tests and closest scrutiny.

Yet they failed.

The wells' designers would have calculated what is typically called the "zone of influence" — the space that waste injected into the wells was expected to fill. This was based on estimates of how much fluid would be injected and under what pressure.

In drawings, the zone of influence typically looks like a Hershey’s kiss, an evenly dispersed plume spreading in a predictable circular fashion away from the bottom of the well. Above the zone, most drawings depict uniform formations of rock not unlike a layer cake.

Based on modeling and analysis by some of the most sophisticated engineering consultants in the country, Florida officials, with the EPA's assent, concluded that waste injected into the Miami-area wells would be forever trapped far below the South Florida peninsula.

“All of the modeling indicated that the injectate would be confined in the injection zone,” an EPA spokesperson wrote to ProPublica in a statement.

But as Miami poured nearly half a billion gallons of partly treated sewage into the ground each day from the late 1980s through the mid 1990s, hydrogeologists learned that the earth – and the flow of fluids through it – wasn’t as uniform as the models depicted. Florida’s injection wells, for example, had been drilled into rock that was far more porous and fractured than scientists previously understood.

“Geology is never what you think it is,” said Ronald Reese, a geologist with the United States Geological Survey in Florida who has studied the well failures there. “There are always surprises.”

Other gaps have emerged between theories of how underground injection should work and how it actually does. Rock layers aren’t always neatly stacked as they appear in engineers’ sketches. They often fold and twist over on themselves. Waste injected into such formations is more likely to spread in lopsided, unpredictable ways than in a uniform cone. It is also likely to channel through spaces in the rock as pressure forces it along the weakest lines.  

Petroleum engineers in Texas have found that when they pump fluid into one end of an oil reservoir to push oil out the other, the injected fluid sometimes flows around the reservoir, completely missing the targeted zone.

“People are still surprised at the route that the injectate is taking or the bypassing that can happen,” said Jean-Philippe Nicot, a research scientist at the University of Texas’ Bureau of Economic Geology.

Conventional wisdom says fluids injected underground should spread at a rate of several inches or less each year, and go only as far as they are pushed by the pressure inside the well. In some instances, however, fluids have travelled faster and farther than researchers thought possible.

In a 2000 case that wasn’t caused by injection but brought important lessons about how fluids could move underground, hydrogeologists concluded that bacteria-polluted water migrated horizontally underground for several thousand feet in just 26 hours, contaminating a drinking water well in Walkerton, Ontario, and sickening thousands of residents. The fluids travelled 80 times as fast as the standard software model predicted was possible.

According to the model, vertical movement of underground fluids shouldn't be possible at all, or should happen over what scientists call "geologic time": thousands of years or longer. Yet a 2011 study in Wisconsin found that human viruses had managed to infiltrate deep aquifers, probably moving downward through layers believed to be a permanent seal.

According to a study published in April in the journal Ground Water, it’s not a matter of if fluid will move through rock layers, but when.

Tom Myers, a hydrologist, drew on research showing that natural faults and fractures are more prevalent than commonly understood to create a model that predicts how chemicals might move in the Marcellus Shale, a dense layer of rock that has been called impermeable. The Marcellus Shale, which stretches from New York to Tennessee, is the focus of intense debate because of concerns that chemicals injected in drilling for natural gas will pollute water.

Myers’ new model said that chemicals could leak through natural cracks into aquifers tapped for drinking water in about 100 years, far more quickly than had been thought. In areas where there is hydraulic fracturing or drilling, Myers’ model shows, man-made faults and natural ones could intersect and chemicals could migrate to the surface in as little as “a few years, or less.”

“It’s out of sight, out of mind now. But 50 years from now?” Myers said, referring to injected waste and the rock layers trusted to entrap it. “Simply put, they are not impermeable.”

Myers' work is among the few studies done over the past few decades to compare theories of hydrogeology to what actually happens. But even his research is based on models.

"A lot of the concepts and a lot of the regulations that govern this whole practice of subsurface injection is kind of dated at this point," said one senior EPA hydrologist who was not authorized to speak to ProPublica, and declined to be quoted by name.

"It's a problem," he said. "There needs to be a hard look at this in a new way."

This report, "Injection Wells: The Posion Beneath Us", first appeared on propublica.org.

Oil drilling has sparked a frenzied prosperity in Jeff Keller's formerly quiet corner of western North Dakota in recent years, bringing an infusion of jobs and reviving moribund local businesses.

But Keller, a natural resource manager for the Army Corps of Engineers, has seen a more ominous effect of the boom, too: Oil companies are spilling and dumping drilling waste onto the region's land and into its waterways with increasing regularity. 

Hydraulic fracturing — the controversial process behind the spread of natural gas drilling — is enabling oil companies to reach previously inaccessible reserves in North Dakota, triggering a turnaround not only in the state's fortunes, but also in domestic energy production. North Dakota now ranks second behind only Texas in oil output nationwide.

The downside is waste — lots of it. Companies produce millions of gallons of salty, chemical-infused wastewater, known as brine, as part of drilling and fracking each well. Drillers are supposed to inject this material thousands of feet underground into disposal wells, but some of it isn't making it that far.

According to data obtained by ProPublica, oil companies in North Dakota reported more than 1,000 accidental releases of oil, drilling wastewater or other fluids in 2011, about as many as in the previous two years combined. Many more illicit releases went unreported, state regulators acknowledge, when companies dumped truckloads of toxic fluid along the road or drained waste pits illegally.

State officials say most of the releases are small. But in several cases, spills turned out to be far larger than initially thought, totaling millions of gallons. Releases of brine, which is often laced with carcinogenic chemicals and heavy metals, have wiped out aquatic life in streams and wetlands and sterilized farmland. The effects on land can last for years, or even decades.

Compounding such problems, state regulators have often been unable — or unwilling — to compel energy companies to clean up their mess, our reporting showed.

Under North Dakota regulations, the agencies that oversee drilling and water safety can sanction companies that dump or spill waste, but they seldom do: They have issued fewer than 50 disciplinary actions for all types of drilling violations, including spills, over the past three years.

Keller has filed several complaints with the state during this time span after observing trucks dumping wastewater and spotting evidence of a spill in a field near his home. He was rebuffed or ignored every time, he said.

"There's no enforcement," said Keller, 50, an avid outdoorsman who has spent his career managing Lake Sakakawea, a reservoir created by damming the Missouri River. "None."

State officials say they rely on companies to clean up spills voluntarily, and that in most cases, they do. Mark Bohrer, who oversees spill reports for the Department of Mineral Resources, the agency that regulates drilling, said the number of spills is acceptable given the pace of drilling and that he sees little risk of long-term damage.

Kris Roberts, who responds to spills for the Health Department, which protects state waters, agreed, but acknowledged that the state does not have the manpower to prevent or respond to illegal dumping.

"It's happening often enough that we see it as a significant problem," he said. "What's the solution? Catching them. What's the problem? Catching them."

Ron Ness, president of the North Dakota Petroleum Council, a lobbying group, said the industry is doing what it can to minimize spills and their impacts.

"You're going to have spills when you have more activity," he said. "I would think North Dakotans would say the industry is doing a good job."

In response to rising environmental concerns related to drilling waste, North Dakota's legislature passed a handful of new regulations this year, including a rule that bars storing wastewater in open pits.

Still, advocates for landowners say they have seen little will, at either the state or federal level, to impose limits that could slow the pace of drilling.

The Obama administration is facilitating drilling projects on federal land in western North Dakota by expediting environmental reviews. North Dakota's Gov. Jack Dalrymple has urged energy companies to see his administration as a "faithful and long-term partner."

"North Dakota's political leadership is still in the mold where a lot of our oil and gas policy reflects a strong desire to have another oil boom," said Mark Trechock, who headed the Dakota Resource Council, a landowner group that has pushed for stronger oversight, until his retirement this year. "Well, we got it now."

Reaching 'the Crazy Point'
Keller's office in Williston is as good a spot as any to see the impacts of the oil boom.

The tiny prefab shack — cluttered with mounted fish, piles of antlers and a wolf pelt Keller bought in Alaska — is wedged between a levee that holds back Missouri River floodwaters and a new oil well, topped by a blazing gas flare. Just beyond the oil well sits an intersection where Keller estimates he saw an accident a week during one stretch last year due to increased traffic from drilling.

Keller describes the changes to his hometown in a voice just short of a yell, as if he's competing with nearby engine noise. Local grocery stores can barely keep shelves stocked and the town movie theater is so crowded it seats people in the aisle, he said. The cost of housing has skyrocketed, with some apartments fetching rents similar to those in New York City.

Slideshow: 'Man camps' of the oil patch

Gregory Bull / AP

Click the view images of living conditions in the North Dakota oil fields.

Launch slideshow

"With the way it is now," Keller said, "you're getting to the crazy point."

Oil companies are drilling upwards of 200 wells each month in northwestern North Dakota, an area roughly twice the size of New Jersey.

North Dakota is pumping more than 575,000 barrels of oil a day now, more than double what the state produced two years ago. Expanded drilling in the state has helped overall U.S. oil production grow for the first time in a quarter century, stoking hopes for greater energy independence.

NBC's Rock Center: Thousands of jobs from North Dakota's boom

It has also reinvigorated North Dakota's once-stagnant economy. Unemployment sits at 3 percent. The activity has reversed a population decline that began in the mid-1980s, when the last oil boom went bust.

The growth has come at a cost, however. At a conference on oil field infrastructure in October, one executive noted that McKenzie County, which sits in the heart of the oil patch and had a population of 6,360 people in 2010, required nearly $200 million in road repairs.

The number of spill reports, which generally come from the oil companies themselves, nearly doubled from 2010 to 2011. Energy companies report their spills to the Department of Mineral Resources, which shares them with the Health Department. The two agencies work together to investigate incidents.

In December, a stack of reports a quarter-inch thick piled up on Kris Roberts' desk. He received 34 new cases in the first week of that month alone.

"Is it a big issue?" he said. "Yes, it is."

The Health Department has added three staffers to handle the influx and the Department of Mineral Resources is increasing its workforce by 30 percent, but Roberts acknowledges they can't investigate every report.

Even with the new hires, the Department of Mineral Resources still has fewer field inspectors than agencies in other drilling states. Oklahoma, for example, which has comparable drilling activity, has 58 inspectors to North Dakota's 19.

Of the 1,073 releases reported last year, about 60 percent involved oil and one-third spread brine. In about two-thirds of the cases, material was not contained to the accident site and leaked into the ground or waterways.

But the official data gives only a partial picture, Roberts said, missing an unknown number of unreported incidents.

"One, five, 10, 100? If it didn't get reported, how do you count them?" he said.

He said truckers often dump their wastewater rather than wait in line at injection wells. The Department of Mineral Resources asks companies how much brine their wells produce and how much they dispose of as waste, but its inspectors don't audit those numbers. Short of catching someone in the act, there's no way to stop illegal dumping.

The state also has no real estimate for how much fluid spills out accidentally from tanks, pipes, trucks and other equipment. Companies are supposed to report spill volumes, but officials acknowledge the numbers are often inexact or flat-out wrong. In 40 cases last year, the company responsible didn't know how much had spilled so it simply listed the volume of fluid as zero.

In one case last July, workers for Petro Harvester, a small, Texas-based oil company, noticed a swath of dead vegetation in a field near one of the company's saltwater disposal lines. The company reported the spill the next day, estimating that 12,600 gallons of brine had leaked.

When state and county officials came to assess the damage, however, they found evidence of a much larger accident. The leak, which had gone undetected for days or weeks, had sterilized about 24 acres of land. Officials later estimated the spill to be at least 2 million gallons of brine, Roberts said, which would make it the largest ever in the state.

Yet state records still put the volume at 12,600 gallons and Roberts sees no reason to change it.

"It's almost like rubbing salt in a raw wound," Roberts said, criticizing efforts to tabulate a number as "bean counting." Changing a report would not change reality, nor would it help anyone, he added. "If we try to go back and revisit the past over and over and over again, what's it going to do? Nothing good."

In a written statement, Petro Harvester said tests showed the spill had not contaminated groundwater and that it would continue monitoring the site for signs of damage. State records show the company hired a contractor to cover the land with 40 truckloads of a chemical that leaches salt from the soil.

Nearly a year later, however, even weeds won't grow in the area, said Darwin Peterson, who farms the land. While Petro Harvester has promised to compensate him for lost crops, Peterson said he hasn't heard from the company in months and he doesn't expect the land to be usable for years. "It's pretty devastating," he said.

Little enforcement
The Department of Mineral Resources and the Health Department have the authority to sanction companies that spill or dump fluids, but they rarely do.

The Department of Mineral Resources has issued just 45 enforcement actions over the last three years. Spokeswoman Alison Ritter could not say how many of those were for spills or releases, as opposed to other drilling violations, or how many resulted in fines.

The Health Department has taken just one action against an oil company in the past three years, citing Continental Resources for oil and brine spills that turned two streams into temporary toxic dumps. The department initially fined Continental $328,500, plus about $14,000 for agency costs. Ultimately, however, the state settled and Continental paid just $35,000 in fines.

The agency has not yet penalized Petro Harvester for the July spill, thought it has issued a notice of violation and could impose a fine in the future, Roberts said, one of several spill-related enforcement actions the agency is considering.

Derrick Braaten, a Bismarck lawyer whose firm represents dozens of farmers and landowner groups, said his clients often get little support from regulators when oil companies damage their property.

State officials step in in the largest cases, he said, but let smaller ones slide. Landowners can sue, but most prefer to take whatever drillers offer rather than taking their chances in court.

"The oil company will say, that's worth $400 an acre, so here's $400 for ruining that acre," Braaten said.

Daryl Peterson, a client of Braaten's who is not related to Darwin Peterson, said a series of drilling waste releases stretching back 15 years have rendered several acres unusable of the 2,000 or so he farms. The state has not compelled the companies that caused the damage to repair it, he said. Peterson hasn't wanted to spend the hundreds of thousands of dollars it would take to haul out the dirt and replace it, so the land lies fallow.

"I pay taxes on that land," he said.

At least 15 North Dakota residents, frustrated with state officials' inaction, have taken drilling-related complaints to the U.S. Environmental Protection Agency in the last two years, records show.

Last September, for example, a rancher near Williston told the EPA that Brigham Oil and Gas had plowed through the side of a waste pit [10], sending fluid into the pond his cattle drink from and a nearby creek. When the rancher called Brigham to complain, he said, an employee told him this was "the way they do business."

A spokeswoman for Statoil, which acquired Brigham, said the company stores only fresh water in open pits, not wastewater, and that "we can't remember ever having responded in such a manner" to a report about a spill.

Federal officials can offer little relief.

Congress has largely delegated oversight of oil field spills to the states. EPA spokesman Richard Mylott said the agency investigates complaints about releases on federal lands, but refers complaints involving private property to state regulators.

The EPA handed the complaint about Brigham to an official with North Dakota's Health Department, who said he had already spoken to the company.

"They said this was an isolated occurrence, this is not how they handle frac water and it would not happen again," the official wrote to the EPA. "As far as we are concerned, this complaint is closed." 

Salting the Earth
Six years ago, a four-inch saltwater pipeline ruptured just outside Linda Monson's property line, leaking about a million gallons of salty wastewater.

As it cascaded down a hill and into Charbonneau Creek, which cuts through Monson's pasture, the spill deposited metals and carcinogenic hydrocarbons in the soil. The toxic brew wiped out the creek's fish, turtles and other life, reaching 15 miles downstream.

After suing Zenergy Inc., the oil company that owns the line, Monson reached a settlement that restricts what she can say about the incident.

"When this first happened, it pretty much consumed my life," Monson said. "Now I don't even want to think about it."

The company has paid a $70,000 fine and committed to cleaning the site, but the case shows how difficult the cleanup can be. When brine leaks into the ground, the sodium binds to the soil, displacing other minerals and inhibiting plants' ability to absorb nutrients and water. Short of replacing the soil, the best option is to try to speed the natural flushing of the system, which can take decades.

Zenergy has tried both. According to a Department of Mineral Resources report, the company has spent more than $3 million hauling away dirt and pumping out contaminated groundwater — nearly 31 million gallons as of December 2010, the most recent data available.

But more than a dozen acres of Monson's pasture remain fenced off and out of use. The cattle no longer drink from the creek, which was their main water source. Zenergy dug a well to replace it.

Shallow groundwater in the area remains thousands of times saltier than it should be and continues to leak into the stream and through the ground, contaminating new areas.

There's little understanding of what long-term impacts hundreds of such releases could be having on western North Dakota's land and water, said Micah Reuber.

Until last year, Reuber was the environmental contaminant specialist in North Dakota for the federal Fish and Wildlife Service, which oversees wetlands and waterways.

Reuber quit after growing increasingly frustrated with the inadequate resources devoted to the position. Responding to oil field spills was supposed to be a small part of his job, but it came to consume all of his time.

"It didn't seem like we were keeping pace with it at all," he said. "It got to be demoralizing."

Reuber said no agency, federal or state, has the money or staff to study the effects of drilling waste releases in North Dakota. The closest thing is a small ongoing federal study across the border in Montana, where scientists are investigating how decades of oil production have affected the underground water supply for the city of Poplar.

Joanna Thamke, a groundwater specialist with the U.S. Geological Survey in Montana, started mapping contamination from drilling 20 years ago. She estimated it had spread through about 12 square miles of the aquifer, which is the only source of drinking water in the area. Over the years, brine had leaked through old well bores, buried waste pits and aging tanks and pipes.

In the Poplar study and others, Thamke has found that plumes of contaminated groundwater can take decades to dissipate and sometimes move to new areas.

"What we found is the plumes, after two decades, have not gone away," she said. "They've spread out."

Poplar's water supply is currently safe to drink, but the EPA has said it will become too salty as the contamination spreads. In March, the agency ordered three oil companies to treat the water or to find another source.

North Dakota officials are quick to point out that oversight and regulations are stronger today than they were when drilling began in the area in the 1950s. One significant difference is that waste pits, where oil companies store and dispose of the rock and debris produced during drilling, are now lined with plastic to prevent leaching into the ground.

New rules, effective April 1, require drillers in North Dakota to divert liquid waste to tanks instead of pits. Until now, drillers could store the liquid in pits for up to a year before pumping it out in order to bury the solids on site. The rule would prevent a repeat of the spring of 2011, when record snowmelt and flooding caused dozens of pits to overflow their banks.

But Reuber worries that the industry and regulators are repeating past mistakes. Not long before he left the Fish and Wildlife Service, he found a set of old slides showing waste pits and spills from decades ago.

"They looked almost exactly like photos I had taken," he said. "There's a spill into a creek bottom in the Badlands and it was sitting there with no one cleaning it up and containing it. And yeah, I got a photo like that, too."

Keller has grown so dispirited by the changes brought by the boom that he is considering retiring after 30 years with the Army Corps and moving away from Williston. He runs a side business in scrap metal that would supplement his pension.

Still, determined to protect the area, he keeps alerting regulators whenever he spots evidence that oil companies have dumped or spilled waste.

Last July, when he saw signs of a spill near his home, Keller notified the Health Department and sent pictures showing a trail of dead grass to an acquaintance at the EPA regional office in Denver. The brown swath led from a well site into a creek.

If the spills continued, he warned the EPA in an email, they could "kill off the entire watershed."

EPA officials said they spoke with Keller, but did not follow up on the incident beyond that. The state never responded, Keller said. The site remained untested and was never cleaned up.

"There was no restoration work whatsoever," Keller said.

This report, "North Dakota's Oil Boom Brings Damage Along With Prosperity", first appeared at propublica.org.

Anadarko Petroleum Corp.

This drill rig is part of an existing field in southern Utah that Anadarko will expand on under a deal with the Obama administration and environmental groups.

Up to 3,675 new natural gas wells on federal land in Utah were approved Tuesday by the Obama administration in a deal that even has the backing of key environmental groups.

"This agreement is a great example of how collaboration can allow us to uphold America’s conservation values, while bringing growth to Utah’s economy and further reducing our dependence on foreign oil by developing our resources here at home," Interior Secretary Ken Salazar said in a statement.

Under the deal struck with the U.S. and environmental groups led by the Southern Utah Wilderness Alliance (SUWA), Anadarko Petroleum will avoid drilling in 15,000 acres around the White River and instead add the new wells to an existing field in southern Utah.

The Utah conservation group called the deal "goundbreaking and exciting."

"We discussed the conservation community’s concerns about the company’s project — primarily impacts to the White River proposed wilderness area and river-related recreation," SUWA attorney Steve Bloch told msnbc.com in explaining how the deal came together. "We also listened to the company’s concerns about regulatory certainty and their hope for a path forward to develop this project without appeals and litigation."

The Natural Resources Defense Council (NRDC), which worked with SUWA and studies energy issues across the country, agreed the deal shows promise.

"We do think this is a model for collaboration" that avoids litigation and conflict, NRDC lands advocate Bobby McEnaney told msnbc.com. "There are right places to drill, and wrong places to drill."

The deal also has the support of The Wilderness Society and the Sierra Club.

Republicans have attacked Obama for not opening more public lands to drilling, especially for natural gas.

“Utahns have gotten used to the Obama administration closing off federal lands to domestic energy production, so this announcement is a long time coming," Sen. Orrin Hatch, R-Utah, said in a statement. "The fact is that much more has to be done to open up more of our state’s land to development."

Salazar on Tuesday countered that the focus is on "expanding safe and responsible production of natural gas as part of an all-of-the-above energy strategy that’s cleaner, cheaper, and full of new jobs."

McEnaney credited Anadarko for showing "a lot of leadership" and taking a "much more proactive stance" than others in the industry.

Ray Bloxham / Southern Utah Wilderness Alliance

Part of the White River that runs through southern Utah.

Anadarko did not immediately respond to msnbc.com's request for comment, but Reuters quoted spokesman John Christiansen as calling it a "new model for prudent development."

And Brad Holly, Anadarko's general manager for the project, told the Associated Press that "at the end of the day, we all want the same thing — clean air, clean water and cheaper fuel."

Environmental activists did have some criticism for the Interior Department, noting that it has shown support for the Gasco natural gas project that would see 200 wells in separate proposed wilderness area.

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U.S. Geological Survey

Scientists have been studying methane hydrates for years, including this drill used to estimate how much there might be under the Arctic permafrost.

Could the future of cleaner fossil fuel really be frozen crystals now trapped in ocean sediments and under permafrost?

Backed by an oil industry giant, the Obama administration recently tested a drilling technique in Alaska's Arctic that it says might eventually unlock "a vast, entirely untapped resource that holds enormous potential for U.S. economic and energy security." Some experts believe the reserves could provide domestic fuel for hundreds of years to come.

U.S. Geological Survey

Natural gas is released from methane hydrates.

Those crystals, known as methane hydrates, contain natural gas but so far releasing that fuel has been an expensive proposition.

The drilling has its environmental critics, but there’s also a climate bonus: The technique requires injecting carbon dioxide into the ground, thereby creating a new way to remove the warming gas from the atmosphere. 

"You're storing the CO2, and also liberating the natural gas," Christopher Smith, the Energy Department's oil and natural gas deputy assistant secretary, told msnbc.com. "It's kind of a two-for-one."

The Energy Department, in a statement last week, trumpeted it as "a successful, unprecedented test" and vowed to pump at least $6 million more into future testing.

"While this is just the beginning, this research could potentially yield significant new supplies of natural gas," Energy Secretary Steven Chu announced.

ConocoPhillips, the oil company that worked on the test at its oil facility in Alaska's North Slope, was hopeful the technique could become economically feasible for producing natural gas, a fuel that's much cleaner than petroleum.

"Many experts believe that methane hydrates hold significant potential to supply the world with clean fossil fuel," spokesman Davy Kong told msnbc.com. "The completion of this successful test of technology is an important step in developing production technology to access this potential resource while sequestering carbon dioxide."

But even the CO2 bonus doesn't convince environmentalists worried about a reliance on fossil fuels -- the key source for manmade carbon dioxide emissions.

"Finding new ways to produce fossil fuels doesn't change the fact that we can't transfer to the atmosphere all the carbon in the fuels we already have without causing catastrophic climate disruption," Dan Lashof, a climate analyst with the Natural Resources Defense Council, told msnbc.com.

"Rather than perpetually seeking new sources of fossil fuel, our federal research dollars should be going into carbon-free energy sources" like solar and wind, added Brendan Cummings, public lands director at the Center for Biological Diversity, a group that's tied climate impacts to its petitions to protect wildlife.

Cummings also worries about inadvertent releases of methane, which is even more powerful as a warming gas than CO2.

Alaska's Arctic is the U.S. area "most under stress from warming," he added. "Even if we could safely develop and install infrastructure there, we're still industrializing an area that essentially should be left alone."

Methane hydrate fans include Vladimir Romanovsky, a permafrost expert at the University of Alaska-Fairbanks.

It has "great potential and not much danger" compared to conventional natural gas, he said. "Extracting energy and sequestering CO2 is win-win situation."

Sen. Lisa Murkowski of Alaska, the ranking Republican on the Senate energy committee, noted that future testing needs to look at issues like soil stability, but overall she was bullish.

"If we can bring this technology to commercialization, it would truly be a game changer for America," she said in a statement. 

"Taken together, U.S. lands and waters contain a quarter of the world’s methane hydrates -- enough to power America for 1,000 years at current rates of energy consumption," her office added.

Related: US wants 'fracking' on fed lands to list chemicals

Alaska alone could hold 600 trillion cubic feet of methane hydrates onshore, the office stated, citing U.S. Geological Survey estimates. That's potentially three times more than the known natural gas deposits in Alaska.

The state also estimates a whopping 200,000 trillion cubic feet of methane hydrates lie under Alaskan waters. That reflects that fact that the vast majority of methane hydrates -- the U.S. Geological Survey estimates 99 percent -- are in ocean sediments.

Related: Keystone pipeline application is back for US review 

A key obstacle for Alaska, and many other areas, is that natural gas pipelines would have to be built. Moreover, today's low natural gas prices due to a saturated market mean little investment incentive, at least for now.

U.S. Geological Survey

A methane hydrate crystal is seen in sediment pulled up by a core drill.

Smith, the Energy Department official, said the testing done earlier this year was notable because it was the first to produce natural gas for 30 days straight. Previous tests had only been able to do that for a few days, and the longer run should make for better analysis, he said.

"The next steps will be determined by what we learn" in the lab over the next few months, he added.

One hydrate expert who had been skeptical said the test showed him that it is possible to remove a costly step: melting, or dissociating, methane from the hydrates to get the fuel.

"The advantage I see is that the need to dissociate hydrates in order to recover the gas will be reduced and probably eliminated," Gerald Holder, dean of engineering at the University of Pittsburgh, told msnbc.com.

Having worked with the Energy Department on hydrates, Holder also said the process shouldn't have any environmental impacts "beyond what drilling for conventional gas entails."

So when might we see commercial production? "I would guess decades," he said.

"One decade would be optimistic," he added, "but not absurd."

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The energy hot potato known as the Keystone XL pipeline was back to the State Department, which announced Friday that it had received a new application from developer TransCanada that includes a reworked route through Nebraska. 

Environmental groups and industry quickly lined up on opposite sides, while the Obama administration said a final decision is not likely before next year.

In Nebraska, Republicans had joined Democrats in objecting to an initial proposal of routing the $7 billion natural gas pipeline from Canada through the sensitive Sandhills region and over the Ogallala Aquifer. 

TransCanada last month released a new proposal that shows the proposed route now east of the Sandhills, but environmentalists question how the map was drawn as well as the overall pipeline, which would start in Canada's "tar sands" region, where extracting the gas includes heavy mining. 

"TransCanada is still pushing the same dirty tar sands pipeline over the Sandhills, over the Ogallala Aquifer, and endangering Americans' drinking water,” Sierra Club Executive Director Michael Brune said in a statement. "They think that if they redraw the map they can fool the people whose land and livelihoods would be threatened by this dangerous pipeline."

A senior executive at the American Petroleum Industry told msnbc.com that he expected Nebraska to approve the new route as part of its ongoing state process. 

"We expect to see strong support" in Nebraska, API Vice President Marty Durbin said. "From our standpoint there are no more excuses."

The State Department, which is involved because the pipeline would cross a U.S. border, said in a statement that it would hire a third-party consultant to review the application, and noted that Nebraska itself doesn't expect to finalize its own decision on the new route for six to nine months.

The controversy has also become a campaign issue between President Barack Obama and Republican Mitt Romney.

Obama has emphasized that he's for increased energy production, and even traveled to an existing stretch of the Keystone pipeline in Oklahoma to show his support.

But the administration also blocked the northern section of the pipeline earlier this year due to the issues in Nebraska.

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