Saturday, July 09, 2011

Democratic Development Part I - The Real World

Last night I caught the last half of This American Life and was both surprised and jealous to discover they were doing a story on one town, Mt. Pleasant, PA, and its encounter with a gas company, Range Resources. The particulars of the story, a conflict over zoning in Mt. Pleasant, has been covered in the press and on-line, so while I am going to recap it here, I urge anyone who has not to check out either TAL's website to download a podcast of the program, or, if you are in the northern Illinois area, listen to a rebroadcast of the program on WNIJ this morning at eleven a.m.

The conflict between Mt. Pleasant and Range Resources can be summed up pretty easily - David and Goliath. As this blog post at Marcellus Drilling makes clear, the company was quite willing to toss an entire town, and all its gas reserves, away if the township didn't pass an ordinance to its liking.
Range Resources, one of the largest drillers in the Pennsylvania Marcellus Shale, is threatening to stop drilling in Mt. Pleasant Township (Washington County), PA. A letter to landowners in the Township says, in part, “We may be forced to shift activity to other, more cooperative townships.”

Why the threat? The dispute seems to center on the type of permits that will be issued in the Township if a new ordinance is passed later this month.
The township has been working on a new oil and gas ordinance which is slated to be adopted by the end of the month. Range, [Township Supervisor Larry] Grimm said, "is dead set opposed" to gas drilling being a conditional use instead of a permitted use. Conditional use would require a public hearing on each well.*


“If the township is still uncooperative, we are prepared to explore all options, including no longer drilling, which would cost landowners tens of millions of dollars in lost royalties. We don’t want to do that.”*
There was not a debate over whether or not to drill in and around the Mt. Pleasant area. The question involved details, wherein the devil usually resides. A conditional-use ordinance may - or may not - require a public hearing on each new well, but it also places restrictions on well location, whether or not company supervisors can sleep on-site (another conflict within the town), truck route usage through the town, and other concerns.

Range, like all stakeholders in this matter, certainly has the right to make its voice heard, to make the case for its preferred outcomes, and to use any and all legal lobbying means necessary to get the township to act in a way that suits its interests. At the same time, the three council members - and there are only three, part time council member, on a limited public budget dealing with a variety of matters all rural communities face from animal control to meth production and distribution along with the gas boom - were pursuing an ordinance they believed, and from the feedback from the community had good reason to expect would be supported as, in the interests of both the township and the gas company. Indeed, the conditional use zoning law would not require a public hearing and comment period before each new well. Rather, it would establish guidelines for bundling proposed and actual wells together for periodic hearings, but Range could continue to explore and drill, provided certain other legal limitations were followed.

This struggle in Mt. Pleasant has been made more complicated by recent attempted legislation in the Pennsylvania State Senate. A bill that would impose an impact fee on natural gas companies had, tucked in near the bottom of the bill, a provision that stated any community that did not pass permitted-use zoning ordinances for the gas companies would have no access to the funds distributed through the legislation. The bill includes a model ordinance local governments could use to draft their legislation to be in line with the proposed legislation.

The legislation failed, but is sure to be reintroduced. As I keep saying, the stakes are too high for this to go away.

The struggle throughout Pennsylvania between gas companies playing the hardest of hard ball and small townships over zoning ordinances has not been lost on local governments in New York. With a ban on natural gas development still in place, localities have been studying the action to their south, and are getting together to compare notes on how to proceed once the ban is lifted.
Gregory Sovas recently addressed local government leaders in Upstate NY to brief them on the fact that local governments cannot enact laws—zoning or otherwise—that would prohibit hydraulic fracturing or drilling in the Marcellus and Utica Shale. The legal principle is that local government laws cannot supersede the state law when it comes to regulating oil and gas drilling. Mr. Sovas should know—he’s the author of the language that became the law.

MDN received a number comments on that article (see here) stating the legality of local zoning ordinances regulating oil and gas drilling is far from over. The commenters claim that New York’s law in this regard is not yet settled.

A recent article sums up that viewpoint, stating that DEC Commissioner Joe Martens has left the door open in the forthcoming new regulations for local governments to control or even ban fracking by using zoning ordinances. . . .
The hardball tactics the gas companies are willing and can afford to play are not pretty. Even more than the often nonsensical theater at the federal level, this kind of local struggle proves how little politics resembles beanbag. Townships, villages, boroughs, counties, any and all local governing bodies throughout the Marcellus Shall region should be prepared for politics at their worst. While there has been much screaming about the topic, particularly on-line, no serious player involved in these matters has proposed an out-and-out long-term ban on natural gas exploration and drilling. Indeed, as the case of Mt. Pleasant, PA makes clear, the issue was not whether to drill and develop, but under what conditions. The gas company has tremendous resources at its disposal, not the least of them the option of withdrawing from the township altogether, letting it wither on the vine while other, neighboring townships (having learned their lesson), prosper as the gas companies are given the keys to the town, the town store, and pretty much anything else they want. The proposed legislation in Pennsylvania, which appears to have a mirror in New York (although it seems assured there will be litigation over that very question), does not help localities in making the best decision for their constituents.

In the real world, the politics of economic development can be rough and tumble. The case of Mt. Pleasant makes clear just how rough.

Friday, July 08, 2011

Bridge Fuel

As we recognize the need for energy independence and alternative sources to power our nation, natural gas is an important economic driver and a critical bridge fuel.
Rep. Dianne DeGette, D-CO

When the total emissions of greenhouse gases are considered, Greenhouse gas emissions from HVSWHF-obtained natural gas are estimated to be 60% more than for diesel fuel and gasoline. HVSWHF-obtained natural gas and coal from mountain-top removal probably have similar releases. These numbers should be treated with caution. Nonetheless, until better estimates are generated and rigorously reviewed, society should be wary of claims that natural gas is a desirable fuel in terms of the consequences on global warming.

Robert Howarth, David R. Atkinson Professor of Ecology & Environmental Biology, Cornell University.
One frequently reads and hears reports on scientific papers in the mainstream press. Whether it is some interesting tidbit about astronomy, the discovery of a planet perhaps, or something from medical biology such as new data on the effects of certain vitamins on general health, science news is either interesting or important. Yet, journalists aren't scientists (and most will admit that under pressure) and sometimes, in the desire to provide timely information they make mistakes. There is nothing wrong with this, and the errors are of the kind that most folks, including many scientists, make, such as confusing correlation and causality.

When there is an issue freighted with so much political, financial, economic, and environmental baggage as a report on the greenhouse gas footprint of fossil fuels, however, the itch to sensationalize may seem overwhelming. In April, Robert Howarth of Cornell University and some colleagues published a paper on the net total effect of natural gas extraction and combustion, comparing it to the extraction and combustion of coal. While admitting up front they had limited data, and revising their estimates based upon misstating the rate of capture of methane within coal veins and mines, they discovered that, far from being a "clean alternative" or "bridge fuel" from dirty coal, the entire process for getting natural gas out of the ground, getting it to municipal generating stations and underground storage tanks where it can be sent through pipelines to residential gas users has a similar overall potential impact to coal.

If you Google "Robert Howarth", among the links provided at the top of the list of 1.9 million include such stories as these: "Natural Gas May Be Worse for the Planet than Coal", in the April 16, 2010 edition of Technology Review; "BBC News – Shale gas ‘worse than coal’ for climate", on the homepage of Gas Drilling Awareness for Cortland County[, NY]; "The Clean Fossil Fuel? Natural Gas Under Fire", from May 9 of this year on the website The Txchnologist, a site sponsored by GE; "Shale gas worse than coal: study", an April 27 report from the Canadian Broadcasting Corporation.

All this breathless reporting has been met by equally breathless retorts from the industry. America's Natural Gas Alliance, the industry umbrella organization, was quick to make clear the limitations of Howarth's study.
News of the National Energy Technology Laboratory's (NETL) presentation supporting the fact that natural gas produces half the greenhouse gas emissions of coal came out last week just as debunked professor Robert Howarth went to Washington to trot out his baseless claim that somehow natural gas is actually a less clean fuel.

News of the National Energy Technology Laboratory's (NETL) presentation supporting the fact that natural gas produces half the greenhouse gas emissions of coal came out last week just as debunked professor Robert Howarth went to Washington to trot out his baseless claim that somehow natural gas is actually a less clean fuel.
The NETL, according to its website, is "part of DOE’s national laboratory system, ... owned and operated by the U.S. Department of Energy (DOE). NETL supports DOE’s mission to advance the national, economic, and energy security of the United States." The report in question is a detailed analysis of the overall greenhouse gas (GHG in the linked report) footprint of natural gas, from cradle to grace, as it were, and it contradicts Howarth's study. In a summary on the website Marcellus Drilling News, the NETL study is summarized as follows:
…the Department of Energy’s National Energy Technology Laboratory (NETL) has applied ISO standard methodology, and a substantial understanding of industry operations, to do the calculation itself… Its conclusion? Used to generate electricity, natural gas – conventional or not – results in far less emissions than coal.

Using a 100-year global warming potential and assuming an average power plant, unconventional gas results in 54% less lifecycle greenhouse gas emissions than coal does. Even using a 20-year global warming potential, as Howarth controversially argues one should, the savings from substituting unconventional gas for coal are almost 50%. The NETL study acknowledges – and explores – a range of uncertainties. But it finds nothing close to the problems that Howarth claims.

Howarth found a large fraction of produced gas from unconventional wells never made it to end users, assumed that all of that gas was vented as methane, and thus concluded that the global warming impacts were huge. As the NETL work explains, though, 62% of that gas isn’t lost at all – it’s “used to power equipment”.
No less an institution than the Council on Foreign Relations has weighed in.
The NETL documents don’t address the Howarth study explicitly, but if you flip to page 25, you’ll see a big part of the discrepancy explained. Some readers will recall that Howarth found a large fraction of produced gas from unconventional wells never made it to end users, assumed that all of that gas was vented as methane, and thus concluded that the global warming impacts were huge. As the NETL work explains, though, 62% of that gas isn’t lost at all – it’s “used to power equipment”.

The NETL work also does a much more careful job looking at things like losses from long distance transmission. In addition, it doesn’t include losses from local distribution, since there’s no local distribution involved in using gas for power generation.

Bottom line: Those who were skeptical of the Howarth study were reacting correctly. There’s still much useful work to be done, but for now, the NETL work is a far more useful guide for thinking through the gas emissions issue.
Since this is science, even as it is laced with politics - big politics, big money, big stakes - the argument, I believe, will go on, but I would offer a couple thoughts on the controversy. First, the issue of the greenhouse has footprint of natural gas is, overall, less urgent than the potential for long-term environmental damage from the process used to extract it, what the NETL report calls "unconventional wells", hydraulic fracturing. Trying to taint natural gas with culpability in global warming misses the point. The threat from hydraulic fracturing is very real, very immediate, yet also long-term, and (perhaps) only tangentially related to matters of global warming.

This is not to suggest that continued study of the question of the cleanliness of natural gas is unwarranted. Given the highly-charged atmosphere (no pun intended), any study will become fodder for whichever side feels their ox is being gored. The question of whether or not considering natural gas a "bridge fuel" to cleaner energy production and use should be continually evaluated. For now, however, the question is not gas's status as a bridge. Instead, studies of the impact of hydraulic fracturing on ground water and soil health should be conducted, and attention should focus on the already-existing questions and problems surrounding the life-cycle of natural gas.

Thursday, July 07, 2011

A Necessary Musical Interlude

I've been working hard all week. At work. Researching and writing these series of posts on the Marcellus Shale gas boom. I need a break from it. Maybe you do, too. Some here's and there's. Then some randomness to sweeten the pot.

Some of these are past their expiration date, but they are also the musical equivalent of comfort food for me. I feel better hearing them.

Now for the unexpected:

Reality Dream III - Riverside
Lay, Lady, Lay - Steve Howe (Bob Dylan Tribute)
Good Lovin' - Grateful Dead (Live)
Now She'll Never Know - Marillion
Compromise - Indigo Girls
So Legt Ihn Die Blumen, Lazarus Oratorio - Franz Schubert
Vital Signs - Rush
Little Brother - Grizzly Bear
Mellotron Scratch - Porcupine Tree

Policy, Politcs, And Hydraulic Fracturing

One complaint often heard in various liberal circles is that the United States is the only industrialized country not to have some kind of comprehensive energy policy. This is very true. We also do not have comprehensive policies regarding housing, job creation, immigration and naturalization, law enforcement jurisdictional lines, and pretty much any other policy area. The reason for this lack of any comprehensive policy in these areas is simple enough to understand: the structure of our government, as well as the whims and fancies of politicians, quite simply create too many barriers to the creation of any comprehensive policy in any area. With federalism placing limitations on the reach and sovereignty of both states and the federal government, differences between civil, criminal, and administrative law as well as their reach, and the ideological and policy preference differences within and among the parties all create enough of a barrier to limit the possibility of creating some kind of comprehensive, coherent policy on any issue you wish to name. Laws change, different parties take over Congress or the Executive Branch, Administrative regulations accrue and change over time, states approach various matters in a piecemeal or thorough fashion, only to have a new governor come in and fundamentally alter the equation.

The pursuit of a comprehensive energy policy and strategy was one of the major goals of the Carter Administration. In a speech to the nation on April 18, 1977 (according to his memoirs, Keeping Faith), he announced his plan to introduce such legislation to Congress, famously declaring that the pursuit of such a policy would be "the moral equivalent of war". Now, there are wars and there are wars. Even the gilded chapter of Carter's memoirs on the subject make clear he and his staff pursued the goal with all the energy and expertise of the Italian campaign in Albania during the Second World War. Rather than a long-term, comprehensive strategy, what emerged at the end of Carter's term were a series of measures, some conflicting with one another, all limited in scope and soon to be ignored or made moot with time. In the decades since, there has been no attempt to create any kind of strategy to deal with the complicated matter of energy consumption, conservation, the environmental threat of extracting non-renewable resources, or support for renewable energy.

The situation at the state level varies depending upon many factors. California, for example, is a good model for how to design an energy policy that balances multiple concerns, while ensuring that all stakeholders both have a voice and surrender their most cherished desires. Texas, on the other hand, is a wide open arena, with oil and gas companies able to dictate the terms of their presence in the state.

Yesterday, I noted Pennsylvania Governor Tom Corbett's desire to make Pennsylvania the Texas of the northeast, by which he presumably means limited administrative and environmental regulation, little to no taxation of their business enterprises or practices.

I will be up front about this approach. I find it odd, to say the least. In the case of Pennsylvania, or, indeed, any of the states in the Marcellus Shale region, it is the states who hold the upper hand in any possible discussion over the terms by which outside entities are allowed to open up shop. The potential of the Shale natural gas fields are far too attractive for the companies to balk at playing by rules that are set to benefit the states in question. In other words, any threat by any gas company not to play ball is empty. In fact, any company that followed through would have three or four others ready to take its place.

Yet, as too often happens, there seems to be a belief that, having abundant natural resources available for exploitation means public capitulation to private demands on everything from taxes and property regulations to environmental oversight and the maintenance of the transportation networks. On the one hand, the states see possibilities for economic development from the industry; on the other hand, they are unwilling to make the industry share the burden for that development, seeing instead such development coming from the effect on development upon existing revenue streams. This scenario is, quite clearly, playing itself out in the mountains of Pennsylvania.

While the states differ in their approaches to the entwined concerns of economic development and environmental protection, there is an on-going effort to address specific concerns regarding the potential hazards from hydraulic fracturing. Introduced recently for the third time, the Fracturing Responsibility And Awareness of Chemicals Act (FRAC Act - I find this kind of thing too cutesy) is designed to address two specific matters relating to hydraulic fracture techniques for natural gas drilling. The first is a loophole in the law that exempts natural gas companies from oversight in matters regarding clean water. The second is the on-going lack of transparency on the chemical content of the fluid used in hydraulic fracturing. A story on the recent reintroduction of the bill includes comments from one of the authors and co-sponsors of the legislation:
“There is a growing discrepancy between the natural gas industry’s claim that nothing ever goes wrong and the drumbeat of investigations and personal tragedies which demonstrate a very different reality,” Rep. Polis said in a press release. “The FRAC Act is a simple, common sense way to answer the serious concerns that accompany the rapid growth of drilling across the country. Our bill restores a basic, national safety-net that will ensure transparency within the industry and safeguard our communities. If there is truly nothing to worry about, then this bill will lay the public’s concern to rest through science and sunlight.”


“As we recognize the need for energy independence and alternative sources to power our nation, natural gas is an important economic driver and a critical bridge fuel,” said Rep. DeGette. “However, it is incumbent upon us to ensure the process for extracting natural gas from our land is done safely and responsibly. The FRAC Act takes necessary but reasonable steps to ensure our nation’s drinking water is protected, and that as fracking operations continue to expand, communities can be assured that the economic benefits of natural gas are not coming at the expense of the health of their families.”

“While the natural gas industry would like to pretend that the current regulatory framework is sufficient to protect the environment, drinking water and public health, scores of citizens throughout the country are telling a different story,” said Rep. Hinchey. “We need to know exactly what chemicals are being injected into the ground and we must ensure that the industry is not exempt from basic environmental safeguards like the Safe Drinking Water Act. The FRAC Act is an important first step toward ensuring that people are protected from the risks of hydraulic fracturing.”
With New York poised to move forward in allowing the use of hydraulic fracturing in the natural gas fields of the Southern Tier, this law would address specific concerns on a national level, giving state lawmakers the ability to make responsible decisions regarding balancing the very real need for economic development with the very real dangers posed by the use of this particular technique. It isn't a national energy policy, but it is a good step forward.

Wednesday, July 06, 2011

Economic Development Or Economic Exploitation

Judge Jones further emphasized that the oil companies “wield significant, if not exclusive, power in the drafting of oil and gas leases” and that “a determination that Plaintiffs had repudiated their leases via the filing of these actions further tips the balance in favor of the oil companies” and “would likely dissuade lessors from bringing potentially meritorious actions.
Report on March 11, 2011 ruling on class action suit brought against Oil and Gas companies by lessors in Pennsylvania, Federal District Court, Middle District of Pennsylvania, Judge John E. Jones III writing for the court.

Nothing more clearly states the tangled issues of economic development, the promise of vast sums of money involved, and the disparate power of the various stakeholders in the pursuit of retrieving the natural gas in the Marcellus Shale in Pennsylvania than this summary report.

According to an on-line fact sheet of the Wilkes-Barre, PA News Leader, between January of 2008 and mid-2009, the asking price per acre for drilling leases went from $100 to as much as $2000 an acre. Over and above the asking price, however, lease terms in Pennsylvania are also dictated by a Pennsylvania statue, known as the Guaranteed Minimum Royalty Act of 1979 (.pdf), that mandates a minimum royalty for lessors on oil and natural gas extracted on privately held land of one-eighth the value extracted. In another class-action suit decision, in federal District Court in Erie, PA, Range Resources was found to have used unlawful accounting methods to determine royalty payments to lessors.
A class action settlement has been reached in a class action lawsuit against Range Resources (“Range Resources” or “Defendant”) in federal district court in Erie, Pennsylvania (styled Frederick v. Range Resources), alleging, among other things, that Range Resources unlawfully reduced natural gas lease royalty payments of certain property owners above Marcellus Shale by using the point-of-sale volume of gas as opposed to the volume of gas collected at the wellhead and by allegedly deducting marketing costs and management fees, according to a Range Resources Marcellus Shale natural gas lease royalty class action lawsuit settlement news report.

The Range Resources Marcellus Shale natural gas lease royalty class action lawsuit settlement reportedly provides, among other things, for a cap on the amount of costs that can be deducted by Range Resources prior to calculation of Marcellus Shale natural gas lease royalties in the future.
Similar such suits are cropping up across Pennsylvania under the terms of the Guaranteed Royalties Act.

Legal action isn't restricted to Pennsylvania, however. In New York, there is a class-action suit brought against Chesapeake Energy by landowners in New York. A moratorium on horizontal-drilling hydraulic fracturing in New York State, and Chesapeake is insisting that the leases, due to expire soon, should be extended.
According to, Chesapeake Energy is one of several energy companies that have sent letters to landowners in the New York Southern Tier with whom it has leases asserting that the state’s fracking moratorium constitutes a “force majeure” — or an unforeseen event that hinders the terms of the contract — and that the leases are being extended. Some of those property owners expected their leases to run out this year. Now, approximately 300 have joined two class action lawsuits Chesapeake’s force majeure claims.
An issue with even more potential impact than the money involved in gas drilling leases is jobs. According to a February, 2011 story in the Wilkes-Barre, PA News Leader, Chesapeake Energy is extending a commitment to hiring local workers, but the pace is slow-going.
When Chesapeake’s first rigs began arriving in Bradford County about two years ago, the company had 38 local employees, according to David Fisher, the company’s vice president of drilling services.

“And when I say local, I mean Pennsylvania, New York, Ohio, West Virginia, working in this Northern District for Chesapeake. As of today, we have 225,” Fisher said.

One of the company’s goals is to see those numbers increase, especially for Pennsylvanians. And, he emphasized on Thursday before a tour of a subsidiary Nomac Drilling’s new employee training and housing facility near Sayre, the jobs are life- and family-sustaining.

It’s possible that someone new to the industry with a high school diploma but no prior experience can complete the training program and start working in the region on drill rigs making between $55,000 and $60,000 a year, Fisher said.

“What we’re trying to do as much as anything else through our training and through our presence here, is to build careers, not just jobs,” he said.


Retired Bradford County Sheriff Steve Evans, who went to work for Chesapeake as senior security officer in February, said he believes the training and housing facility is “living proof” that Chesapeake is “a company that really cares about minimizing the impact of a major, major operation – the harvesting of Marcellus Shale.”

“This is a substantial financial commitment to the community. We have housing issues here. There’s not enough housing. So this company invested a great amount of resources in building a very nice part of our community,” Evans said.

And, he said, the men and women who work for TriCorps Security at the facility are current or retired law enforcement officers from the local community.

“I know their personal stories, folks. I know that this has been a real blessing. Law enforcement officers don’t get paid a tremendous amount of money, and Chesapeake/Nomac has had no problem providing professional law enforcement officers, in exchange for their efforts, financial means to help their families in these trying times,” Evans said.
Money for land. Money for gas. The prospect of careers in a field that pays well. The lure away from public service to private security. All of these are very real, and very promising opportunities for a region of the country that has been seeking investment in development. The kinds of opportunities the gas boom is offering land-owners, communities, and individuals are very real and very attractive. The various law suits in both New York and Pennsylvania involve land owners seeking better terms, and legally-calculated returns for leasing their property for natural gas development.

Yet, what is the cost hidden behind the billions of dollar signs? As I indicated yesterday, there have already been a host of environmental and safety issues in the gas fields. Pennsylvania's Republican governor is attempting to address concerns in what can only be called a unique administrative manner.
Approval of enforcement actions and punishments aimed at Marcellus Shale drilling operators must now go through top officials in the Department of Environmental Protection in a change that the agency said Wednesday is aimed at improving its consistency in handling the rapidly growing industry.


"We need to make sure we are consistent and that we make our best effort to be the most effective regulator of this industry, which will benefit all Pennsylvanians," [Katy] Gresh {PA DEP Spokeswoman] said.

Gov. Tom Corbett, whose successful campaign last year received sizable donations from members of the natural gas industry, has said he wants to make Pennsylvania the Texas of the natural gas boom. Pennsylvania is the largest natural gas state not to tax the activity, and Corbett is against imposing a new tax on it.
As questions about the potential environmental hazards of hydraulic fracturing mount; as accidents across the state pour toxins in to water ways and water sheds, and as neighboring New York is poised to reopen private lands for natural gas exploration and extraction, the push and pull of the various issues and questions has yet to be addressed systematically. Both PA's Republican Governor and New York's Democratic Governor see the potential benefits from the investment in economically stressed areas. While New York placed a moratorium on hydraulic fracturing, there is every indication that moratorium will be lifted soon. What is left unaddressed in the potential cost of the environmental damage.

All those dollar signs are silencing a host of uncomfortable questions that have not yet even been asked, let alone answered. Good jobs, better roads, financial security are all attractive goals, worthy of state support. At the same time, protecting our natural resources from undue and unnecessary damage, even destruction, is also a worthy goal, offering the grim possibility that all the money made today may end up being needed to pay the cost of cleaning up the mess that will, most assuredly, be left behind.

Tuesday, July 05, 2011

Hydraulic Fracturing - Promise And Problems

While geologists and industry specialists understood, before the various revised assays of the region, there was a lot of potential for natural gas deposits within the Marcellus Shale, it was with the development of horizontal drilling combined with hydraulic fracturing (known as "fracking") in the past couple decades that have allowed for deep wells (up to 10,000 feet) to be drilled to access these deposits. With the widespread, successful use of fracking in the Barnett Shale in the Dallas-Fort Worth area, it became industry practice. It also opened up many new areas for exploration and exploitation.

Fracking is simple enough to understand. Because there are few huge reservoirs of natural gas within and beneath the layer of shale, the trick to getting the gas out is two-fold. First, the shale is brittle, what geologists call fissile. Because it is made up in part from the compression of organic materials, it is also porous, tiny holes and pockets running through out the formation. In order to get that gas, the rock has to be broken, the gas then pooling and forced out of the ground.

Fracking does both. While basically water, it has a variety of chemicals and physical additives, to give it some punch. Forced under high pressure, it hits that fissile material. After sufficient shale has been reduced to power, the water acts to force the natural gas in to the empty space. The flow on the pipe is reversed, and up comes the gas. Then, the fracking liquids are pumped out as much as possible.

The industry insists that, done properly, the process poses no risks and offers the benefit of access to previously untapped sources of energy. With natural gas burning far more clean than coal, it is touted as an alternative for use in municipal power generating plants as well as residential power (full disclosure here - our house has a generator that is powered by natural gas; once a week, it cycles through a test run filling the surrounding with the smell of gas; we love our generator, and if it weren't for the natural gas line that feeds it, we would have many days and nights without power, in the worst parts of both summer and winter). With the many debates over energy use, global warming, and the impact coal-fired electrical plants have that are not limited to greenhouse gas emissions, it would seem that the fields in the Marcellus Shale offer the prospect of long-term access to a cleaner alternative.

The process, however, is not without either its critics or its problems. I will admit that my doubts about the entire situation began not with the discovery of the Marcellus gas boom itself, but last June when I heard a report on NPR about a documentary entitled Gasland, which I wrote about. The following is from the transcript of the interview host Ira Flatow did with the director of Gasland, Josh Fox:
I traveled to a nearby place called Dimock Dimock, Pennsylvania, 50 miles away from me. And I found the place in utter dismay and disarray. Halliburton trucks all over the place. People - very scared, their water bubbling and fizzing, kids getting sick. One of the resident's water well exploded on New Year's Day 2009, just spontaneously combusted because I guess so much natural gas is pooling up inside the water well that the pump ignited it and it blew up into...

FLATOW: Did this only happen after the drilling...

Mr. FOX: After the drilling.

FLATOW: It wasn't there all this time?

Mr. FOX: No.

FLATOW: It was like natural gas pockets underground and...

Mr. FOX: Well...

FLATOW:...that might have existed and they happen to tap into while they were drilling their own well.

Mr. FOX: Residents insist that their water was good. There were pre-drilling tests that showed no methane or natural gas compounds, which are also some of the more volatile organic compounds that are carcinogenic...

FLATOW: Mm-hmm.

Mr. FOX: ...benzene, toluene, xylene. You know, the residents on the ground and everywhere that I went where this is a problem, chemicals migrating into the water supply from the drilling process.
In April, The New York Times published a long article that looked at the same sets of issues and questions surrounding the practice.
“Questions about the safety of hydraulic fracturing persist, which are compounded by the secrecy surrounding the chemicals used in hydraulic fracturing fluids,” said the report, which was written by Representatives Henry A. Waxman of California, Edward J. Markey of Massachusetts and Diana DeGette of Colorado.

The report, released late Saturday, also faulted companies for at times “injecting fluids containing chemicals that they themselves cannot identify.”

The inquiry over hydrofracking, which was initiated by the House Energy and Commerce Committee when Mr. Waxman led it last year, also found that 14 of the nation’s most active hydraulic fracturing companies used 866 million gallons of hydraulic fracturing products — not including water. More than 650 of these products contained chemicals that are known or possible human carcinogens, regulated under the Safe Drinking Water Act, or are listed as hazardous air pollutants, the report said.

A request for comment from the American Petroleum Institute about the report received no reply.


Some ingredients mixed into the hydraulic fracturing fluids were common and generally harmless, like salt and citric acid. Others were unexpected, like instant coffee and walnut hulls, the report said. Many ingredients were “extremely toxic,” including benzene, a known human carcinogen, and lead.

Companies injected large amounts of other hazardous chemicals, including 11.4 million gallons of fluids containing at least one of the toxic or carcinogenic B.T.E.X. chemicals — benzene, toluene, xylene and ethylbenzene. The companies used the highest volume of fluids containing one or more carcinogens in Colorado, Oklahoma and Texas.

The report comes two and a half months after an initial report by the same three lawmakers that found that 32.2 millions of gallons of fluids containing diesel, considered an especially hazardous pollutant because it contains benzene, were injected into the ground during hydrofracking by a dozen companies from 2005 to 2009, in possible violation of the drinking water act.
As the report made clear, the companies consider the details over what is included in the fluid injected underground proprietary information, and refuse to divulge details over its contents. All the same, the discovery of high concentrations of various toxic and carcinogenic compounds in and around drilling areas has raised red flags among both environmental activists and law-makers.

On April 20 of this year, at a natural gas well outside Canton, PA, a cracked pipe led to the release of thousands of gallons of fluid used in the fracking process. The leak, above ground, reached a small stream that, in time, dumps in to the Susquehanna River. This particular well was operated by Chesapeake Energy, an Oklahoma City-based energy company that is among the biggest investors in the Marcellus Shale Development.

This isn't the only time there have been problems with Chesapeake-operated wells.
Pennsylvania regulators levied a record fine for contaminating drinking water against major natural gas producer Chesapeake Energy, a move that threatens to intensify a fierce debate over drilling for natural gas in the state.

The Pennsylvania Department of Environmental Protection fined Chesapeake $900,000 for contaminating water supplies inBradford County, a busy drilling area in the prolific Marcellus shale gas formation, the agency said on Tuesday. It was fined another $188,000 for a fire that injured three workers in February.

The fine will again cast a spotlight on hydraulic fracturing, or fracking, a controversial process used to extract natural gas from shale formations, which involves blasting a mix of water, chemicals and sand into the rock.

While public criticism has recently been focused on the possible contamination from fracking waste products, Tuesday's action stems from complaints that gas near drilling wells had seeped into the drinking water.

The agency began an investigation in February 2010 after receiving complaints from residents about drinking water near Chesapeake shale gas drilling sites. The agency concluded that contamination was caused by improper well casing and cementing, allowing seepage from non-shale shallow gas formations.
And Chesapeake isn't the only company facing penalties. According to a report published in April of last year in the Towanda, PA Daily Review, since the beginning of large-scale drilling in Pennsylvania in 2008, there were 1500 violations of various state environmental laws.
Two-thirds of the 1,435 violations were identified by the report's authors as likely to harm or pose a threat to the environment, while the other third were identified as administrative or safety violations.

The violations were issued by the state Department of Environmental Protection, the agency that regulates gas drilling in Pennsylvania, which released the records to the association in response to a Right to Know Law request.

Elana Richman, projects coordinator for the Pennsylvania Land Trust Association, said the organization sought the records to measure the gas extraction industry's environmental record as Marcellus Shale drilling expands in the state.

"We had the feeling that there was a lot out there that we weren't seeing," she said.

The association found that of the 952 violations with environmental implications, 277 were for improper erosion and sedimentation plans or controls, 268 were for faulty wastewater pits, 100 were violations of the state's Clean Streams Law, and 154 were spills of brine, oil, drill cuttings or other waste to the ground or streams.

DEP released the details of one such spill Monday, when it announced that it had fined Talisman Energy USA $15,506 for a spill of gas drilling wastewater at a Bradford County well site in November.

The spill of between 4,200 to 6,300 gallons polluted a small, unnamed tributary to Webier Creek, DEP said. The company has since completed the state's cleanup requirements.

Violations associated with recent high-profile environmental accidents, like well blowouts and gas contamination of water supplies, occurred in smaller numbers during the report's study period, between January 1, 2008, and June 25, 2010.
Another company that has faced fines is Dallas-based Chief Oil & Gas, which received a $180,000 fine from the PA DEP. Chief is the company that states, right on its homepage, that social responsibility is one of its core values.

It isn't just the potential for contamination of ground water and wells. There are other, more insidious potential hazards linked to fracking.
Two natural gas companies agreed Friday to temporarily cease operations of injection wells in an area of central Arkansas that has seen more than 800 earthquakes during the past six months.

Oklahoma City-based Chesapeake Energy and Clarita Operating of Little Rock said they would comply with the Arkansas Oil and Gas Commission’s emergency request to stop all injection activities in Greenbrier- and Guy-area wells used to dispose of wastewater from production. The panel’s next regular meeting is March 29.

Geologists are studying a swarm of recent area quakes, most tiny, in an attempt to determine whether there is a connection between the seismic activity and gas-drilling companies’ work in the Fayetteville Shale formation. A 4.7-magnitude earthquake, the most powerful reported in the state in 35 years, struck near Greenbrier on Sunday night.

A six-month moratorium on new injection wells in the area took effect in January to allow time to determine what relationship, if any, there is between the wells and the earthquakes.
In the absence of a comprehensive national energy policy that includes incentives for research and development for alternative energy sources, there is an obvious need for the potential resources that lie deep beneath the Northeast United States. Nothing, however, occurs without some cost, and the wide-spread use of hydraulic fracturing certainly poses as many risks and hazards as it does the promise of extracting badly-needed natural gas from two miles below the surface. It would seem obvious that, in light of the sheer volume of issues surrounding the practice, more and better safeguards are needed to ensure both that the practice is carried out in a responsible manner as well as fulfilling the promise of all that untapped natural gas becoming available for use.

Tomorrow - Development or Exploitation?

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, 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.


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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