Oil Tycoon Accused of Illegal Dumping at Fracking Site

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     BISMARCK, N.D. – On his website, oil tycoon Jason Halek proclaims, “It is my deepest desire to play a major part in enlightening the world and helping others by exposing the deception often perpetrated by government, organized religion, and the world at large. Regrettably, too many citizens are unaware of the deception that surrounds them, and I seek to awaken them. My ambition is to work diligently to discover more and more truth, and in turn spread that truth to others.”
     The federal government is also on a quest for truth – with Halek at the heart of it.
     On August 6th, the government indicted Halek on 13 counts, including conspiracy to violate the Safe Drinking Water Act and defraud the United States. The indictment, which details violations occurring between December 2011 and March 2012, was unsealed yesterday.
     The charges center around Halek’s operation of a “saltwater disposal well” named Halek 5-22 near Dickinson, North Dakota. According to a Justice Department statement, “saltwater” in this context “covers a wide array of drilling waste fluids, including hydraulic fracturing fluid, which is water combined with chemical additives such as biocides, polymers and ‘weak acids.’ The Environmental Protection Agency has stressed that this water is often saltier than seawater and can ‘contain toxic metals and radioactive substances.'”
     Because of the danger saltwater poses to groundwater and potable water sources, the EPA and the North Dakota Industrial Commission strictly regulate the operation of saltwater disposal wells and require monthly reports of any dumping as well as regular mechanical integrity tests.
     According to the indictment, Halek and his co-conspirator Nathan Garber blew off these safeguards in an attempt “to defraud the United States, to hamper, hinder, impede, impair, and obstruct by craft, trickery, deceit and dishonest means the lawful and legitimate functions of the EPA, in enforcing federal laws relating to the requirements of the North Dakota underground injection control program.”
     Specifically, Halek disposed of saltwater into the well without alerting the EPA or the state commission as required by law, according to the indictment. In addition, he failed to submit the mandatory monthly reports or to test the well for mechanical integrity, and at one point he injected more than 8,000 barrels of saltwater into it over a two-week period, despite a verbal “shut-in” order from the commission.
     He also continued to dump into the well after it failed a pressure test and lied about the depth of the well’s “packer” – a sealing device meant to keep wastewater pushed far below the earth’s surface, prosecutors say.
     Halek then attempted to dodge responsibility by claiming his involvement with the well ceased after he transferred ownership to Nathan Garber in January 2012. In a letter to the federal grand jury investigating the allegations, Halek wrote, “There are no other Halek documents after Jan. 23, 2013 [sic: 2012], which have not been already produced because Garber assumed full management and control of the well. The absence of any other additional Halek documents proves that Halek was not involved in any management of the wells after the assignment of Jan. 23, 2012.”
     The federal government didn’t buy it, charging Halek with obstructing official proceedings by filing a false statement when he “well knew and believed he had custody and control of Halek documents relating to the Halek 5-22 well after Jan. 23, 2012, including documents demonstrating that Halek was involved in the management of the Halek 5-22 well after Jan. 23, 2012,” according to the 28-page indictment.
     This is not the first time Halek has been the subject of federal scrutiny. In 2010, the Securities and Exchange Commission sued him for raising $22 million from investors using unregistered securities to fund energy projects in Texas.
     He settled that lawsuit by paying a $50,000 fine and agreeing to return “ill-gotten gains,” Environment and Energy Publishing reported in August 2013, while his business partner paid more than $1.1 million.
     Similarly, the government is now asking that Halek forfeit any profits he made from the illegal saltwater disposal.
     The case is being prosecuted by Christopher Costantini with the Environmental Unit of the United States Department of Justice and U.S. Attorney for North Dakota Cameron Hayden.
     The Justice Department declined to comment on the case. Halek’s attorney, Alexander Reichert, could not be reached by press time.
     A jury trial is set for Oct. 27 in Bismarck.