Monday, July 04, 2011

Frack, Baby, Frack!

In my emotional response to certain immediate matters regarding the development of natural gas resources in and around the area of the country where I grew up, I have been negligent in making clear exactly what it is I'm talking about, where, and what the potential stakes - economic, environmental, political - may prove to be. For right now, I'm going to take a moment, step back, and talk about what the Marcellus Shale is, and what the potential natural gas reserves buried deep underneath the ground may mean.


This mas shows where, precisely, the Marcellus Shale formation is. It all started 400 million years ago when what is now the eastern United States was (a) in the southern hemisphere, and (b) the bottom of a narrow, but relatively deep small ocean. Like the oceans today, it was filled with all sorts of life, the bulk of which was small to microscopic. Like all life, it ended, floating gently down to depth of over a kilometer and more that, lacking oxygen, impeded decay of the organic material. Layer upon layer upon layer of dead plankton and microfauna piled up until, over the course of time, and pressure, and heat, and the drifting of continental plates, a relatively thick and broad layer of black shale developed. The organic components, under tremendous pressure, were changed in to various forms of fossil fuels, although the pressure from the overlying layers eventually cracked much of the oil to natural gas. Originally named for an outcropping in the central New York town of Marcellus during the first systematic geological survey of the state in the 1830's, the extent of the shale has been documented by geologists, who also understood that, along with various ores - pyrite and gypsum and, perhaps, sulfur blooms - was the possibility of fossil fuels.

There have been natural gas wells throughout the Marcellus deposits for decades, low yield, yet ultimately profitable because of their longevity. Major development of the region as a natural gas repository, however, was not deemed feasible as most estimates were that any large reserves were both too deep and variable, trapped within small pockets within the shale, to be viable. According to this article at Geology.com, as recently as 2002, the USGS didn't see any potential for exploiting the reserves.
As recently as 2002 the United States Geological Survey in its Assessment of Undiscovered Oil and Gas Resources of the Appalachian Basin Province, calculated that the Marcellus Shale contained an estimated undiscovered resource of about 1.9 trillion cubic feet of gas. [1] That's a lot of gas but spread over the enormous geographic extent of the Marcellus it was not that much per acre.

--snip--

In early 2008, Terry Englander, a geoscience professor at Pennsylvania State University, and Gary Lash, a geology professor at the State University of New York at Fredonia, surprised everyone with estimates that the Marcellus might contain more than 500 trillion cubic feet of natural gas. Using some of the same horizontal drilling and hydraulic fracturing methods that had previously been applied in the Barnett Shale of Texas, perhaps 10% of that gas (50 trillion cubic feet) might be recoverable. That volume of natural gas would be enough to supply the entire United States for about two years and have a wellhead value of about one trillion dollars! [5]
It is important to put some kind of perspective on the potential for developing the region as a source for fossil fuels. The best way to do that is to compare the Marcellus region with the well-known, and much debated, oil reserves buried beneath the Arctic National Wildlife Refuge (ANWR).
In 1998, the USGS estimated that between 5.7 and 16.0 billion barrels (2.54×109 m3) of technically recoverable crude oil and natural gas liquids are in the coastal plain area of ANWR, with a mean estimate of 10.4 billion barrels (1.65×109 m3), of which 7.7 billion barrels (1.22×109 m3) lie within the Federal portion of the ANWR 1002 Area.[17] In comparison, the estimated volume of undiscovered, technically recoverable oil in the rest of the United States is about 120 billion barrels (1.9×1010 m3).[24] The ANWR and undiscovered estimates are categorized as prospective resources and therefore, not proved. The United States Department of Energy (DOE) reports US proved reserves are roughly 29 billion barrels (4.6×109 m3) of crude and natural gas liquids, of which 21 billion barrels (3.3×109 m3) are crude.[25] A variety of sources compiled by the DOE estimate world proved oil and gas condensate reserves to range from 1.1 to 1.3 trillion barrels (210 km3).[26]

The DOE reports there is uncertainty about the underlying resource base in ANWR. “The USGS oil resource estimates are based largely on the oil productivity of geologic formations that exist in the neighboring State lands and which continue into ANWR. Consequently, there is considerable uncertainty regarding both the size and quality of the oil resources that exist in ANWR. Thus, the potential ultimate oil recovery and potential yearly production are highly uncertain.” [24]

In 2010, the USGS revised an estimate of the oil in the National Petroleum Reserve–Alaska (NPRA), concluding that it contained approximately "896 million barrels of conventional, undiscovered oil".[27] The NPRA is west of ANWR. The reason for the decrease is because of new exploratory drilling, which showed that many areas that were believed to hold oil actually hold natural gas.
According to revised estimates on the total amount of natural gas contained, and the use of hydraulic fracturing techniques increasing the recovery rate, Terry Engelder of Penn State revised earlier estimates and claimed as much as 1300 trillion cubic feet of natural gas was, potentially, recoverable. That translates into 4800 cubic kilometers. By contrast, ANWR contains 210 cubic kilometers of recoverable oil reserves by the revised estimates of 2010 USGS survey. All the attention paid to empty lands along the Arctic Ocean, and right there on the doorstep of the nation's capital, within driving distance of the eastern seaboard, is a monumental amount of potentially exploitable fossil fuels.

With this comparison, it is easy enough to understand why, after 2008, there was a tremendous increase in interest in tapping the reserves. Many companies - among them Chesapeake Energy, based in Oklahoma City, and Chief Oil & Gas, based in Dallas - have rushed in. Right now, Pennsylvania is the hot spot of activity. With New York's governor Andrew Cuomo signalling his intent to lift the ban on fracking within certain guidelines and under what he says are "strict controls", however, New York may soon join Pennsylvania as a hotbed of natural gas exploration and drilling.

During the 2008 Presidential campaign, one phrase one heard repeated far too often was "Drill, Baby, Drill!", the demand to open public lands in Alaska to petroleum production. It may well be that a stealth campaign issue for next year will be the exploitation of the Marcellus Shale, with the revised restrain that is the title of this post heard around much of the country.

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