August 29, 1997
Dr. Lawrence Fischer
Chair, Michigan Environmental Science Board
Knapps Centre
300 South Washington Square, Suite 340
Lansing, Michigan 48933

Dear Dr. Fischer,

In July, a public hearing was held by the Department of Environmental Quality on a proposal by Newstar Energy to install two new directionally drilled wells beneath Lake Michigan. The Michigan Land Use Institute, a nonprofit environmental research and advocacy organization based in Benzonia, joined citizens and a number of other public interest organizations in raising several questions about this proposal.

The Institute has undertaken a thorough review of the Newstar application. Our assessment was driven by the understanding that Lake Michigan is globally unique. It is the principal drinking water source for millions of people, a prime recreational resource, and is part of an ecosystem that contains 20% of the planet's fresh water.

Thus we were encouraged by Governor Engler's charge to the Environmental Science Board to more fully evaluate the risks of drilling beneath Lake Michigan from the shoreline.

The DEQ asserts that leaks from the directionally drilled wells will not endanger the water quality of Lake Michigan, and we agree. Newstar's wells will be drilled through bedrock thousands of feet beneath the bottom of the lake. The rock acts as an impermeable seal that will not allow gas or oil to leak into the water.

Our research, however, identified an array of other environmental, land use, and safety issues which we urge the Environmental Safety Board to fully consider during its review.

The greatest potential risk to the environment comes at the well site. A fire, blowout, or explosion at the well-head could cause oil and gas to escape into Lake Michigan. Any assessment of directional drilling should take these risks into account.

If Newstar makes a successful strike, the potential for significant changes in patterns of land use along the coast will be high. The oil and gas industry is competitive. The discovery of a sizable oil or gas reserve will stir much more exploration and drilling activity. Recently, the state proposed leasing thousands of acres along the coast of Lake Michigan for energy exploration. We also are aware of a major investment Shell Oil is now making in seismological research along the coast south of Ludington to explore not only the Niagaran formation, but deeper potential reserves as well. Many more drilling and production sites — and new roads, pipeline corridors, and industrial facilities — could be constructed in a coastal ecosystem already under intense development pressure.

The Niagaran formation, which Newstar is seeking to tap, is a known source of hydrogen sulfide (H2S), a poisonous gas. Other wells in the Manistee area contain high concentrations of H2S. Last summer, 11 people in Manistee were injured and taken to the hospital after a release of H2S from a natural gas well. The DEQ held a separate public hearing on H2S safety in July in Scottville. The Institute, citizens, and Filer Township, among others, are pressing the state for a comprehensive safety plan that is based on establishing a new and formal H2S public exposure standard.

The Governor's charge to the Board — to assess the impact that directional drilling of oil and gas wells has on the Great Lakes — is certainly broad enough to incorporate these issues into its review. To the extent that the Institute is able to assist you in any aspect of the Environmental Science Board's work, please do not hesitate to call on us. We look forward to the Board's findings.

Yours Sincerely,

Keith Schneider
Executive Director