The Environmental Protection Agency said yesterday it will not regulate oil and gas drilling wastes as hazardous material but will get tough on states that fail to enforce existing laws governing their disposal.

"We were concerned about layering on another level of regulations," said J. Winston Porter, the EPA's assistant administrator for solid waste and emergency response.

Congress in 1976 gave the EPA authority generally to decide what waste needs to be covered by the strict handling and disposal regulations that apply to hazardous wastes, but it required a study before decisions could be made about oil and gas production wastes.

The EPA in December completed the study and then allowed the public to comment before drafting its recommendations. The final report will be presented to Congress today.

"It was a tough decision but I think we made the right decision," Porter said.

However, an environmental group criticized the decision as contrary to the public interest.

"These substances ... do contain hazardous wastes with names 14 syllables long," said Mike Matz, Alaska's representative to the Sierra Club. "Clearly the EPA once again is favoring big oil and big business and is shunting its responsibility to protect the public health and the environment."

The EPA estimated in its report that oil and gas production would be reduced by up to 12 percent if drilling wastes were treated as hazardous. The cost of the program would have been at least $1 billion and could have ranged up to $5 billion to $6 billion, Porter said.

The American Petroleum Institute had put thoses costs much higher -- up to $37 billion the first year and $7 billion annually thereafter, said Sen. Lloyd Bentsen (D-Tex.).

The EPA said stripper wells, which generally produce fewer than 10 barrels of oil a day, could not have easily absorbed the additional costs for hazardous waste management.

Laws dealing with hazardous wastes are "not very flexible and just didn't seem to fit this industry very well," Porter said. "Conditions vary, but the requirements are very prescriptive."

While a well may take only three to four months to drill, it can take as long as two years to get a permit to dispose of hazardous wastes, he said.

"We did find problems in some areas and we intend to keep after it with the states to see if we can significantly beef up enforcement," he said.The biggest problem found by the EPA at the nation's hundreds of thousands of wells was the disposal of the salt water that is extracted from wells in the drilling process. Porter said regulations already exist to cover that problem.

He said most states also have good regulations covering the capping of unproductive wells, but that better enforcement also was needed in some areas.

"It is important that we move vigorously to protect public health and the environment from hazardous substances," said Bentsen. "But EPA has recognized, and rightly so I believe, that the energy industry is already subject to a host of state and federal regulations that generally provide effective protection."

There are nearly 800,000 crude oil and natural gas generating sites across the country, compared with slightly more than 100,000 generators currently in the hazardous waste system, the EPA said.

The EPA said the regulation of drilling wastes could have severely strained existing hazardous waste storage, treatment and disposal capacity and significantly increased the burden for state and federal hazardous waste regulation programs.

Nearly 8.4 billion barrels of oil and 44 billion cubic feet of natural gas are produced in the United States daily, primarily in Texas and Alaska. Stripper wells are located across the country and produce about 14 percent of total U.S. production.

The EPA said improperly managed wastes can cause damage to human health and the environment through surface and groundwater contamination.

The toxic constituents of oil and gas wastes include the hydrocarbons benzene and penanthrene. Inorganic constituents include lead, arsenic, barium, antimony, chlorides and sodium.