Fracking: Promise--and Peril
“Are you lost?”
That was how Jeffrey Reid of the North Carolina Geological Survey (NCGS) was greeted in Pittsburgh three years ago before making a presentation at the annual conference of the Association of American Petroleum Geologists (AAPG).
Reid’s presence at the group’s annual conference came as a surprise to other participants because North Carolina has not traditionally been thought of as an oil and gas state.
But horizontal drilling and hydraulic fracturing — or “fracking” — are game-changing technologies that have turned shale deposits in other parts of the country and around the world into major players in the past decade for the extraction of natural gas.
And the boom in fracking appears to be on the verge of potentially trickling down to northern Moore County, which lies atop the Deep River basin, where Reid and his associates believe a 40-year supply of natural gas exists.
“That’s just one opinion, but we’ve been collecting information over time,” says Ken Taylor, assistant state geologist and chief of the NCGS. “We think there is an economic field of natural gas. It was just anecdotal stories until you found out about shale gas being found in other parts of the country and around the world.”
There is a contentious worldwide debate over whether fracking is safe, and there is little scientific evidence to fill an information gap that has made it difficult for lawmakers and the public to understand the risks.
In May, four scientists at Duke University published the results of a study they conducted in Pennsylvania and New York, which linked fracking with a pattern of drinking water contamination. They found that drinking water wells near some natural gas extraction sites in those two states have about 17 times the normal level of methane gas.
Methane contamination of drinking water wells has been a common complaint among people living in areas across the country where fracking is allowed.
Hope Taylor, a research scientist and executive director of Clean Water for North Carolina, has reviewed the study and believes the data is credible.
“It confirms contamination in drinking wells close to gas extraction places,” she says. “North Carolina has 2.7 million people who depend on private, unregulated wells for their drinking water. While not all of them live in the 14 counties in this state where fracking could occur, there is great cause for concern.”
Perhaps the most infamous example of the alleged dangers of fracking came in “Gasland,” the Academy Award-nominated documentary that was recently screened at the Sunrise Theater in Southern Pines. In it, a man holds a lighter to his kitchen faucet as he opens the tap and a burst of flame comes out. But the legitimacy of the shot, dramatically exploited by filmmaker Josh Fox, was questioned when the Colorado Oil and Gas Conservation Commission said it had determined that the fireball did not come from gas wells.
Lee County Targeted
Fracking is illegal in North Carolina — for now — but gas companies descended on Lee County in the first quarter of 2010 after Taylor and Reid presented “North Carolina’s Shale Gas Potential: Who Knew?” at the AAPG annual conference in Kalamazoo, Mich. Lee County was targeted because it sits in the epicenter of the Deep River basin.
“That’s where the gas is,” Taylor says. “It essentially sits in the Cumnock formation, which is between the Sanford and Pekin formations. It’s like the icing between a two-layer cake.”
Today, the mineral rights to about 9,400 acres in Lee County are under contract, with the gas companies eyeing legislation passed this year by the General Assembly that moves the state closer to shale gas development. House Bill 242 calls for a fracking study to be completed by three state agencies by May 1.
“Fracking has been done thousands of times without problems,” Taylor says. “There have also been times when it’s been screwed up. We need to take the lessons learned in other states and not repeat their errors.”
After a well is dug vertically and then turned horizontally, fracking involves forcibly pumping 2 million to 8 million gallons of water at great pressure to effectively shatter the shale, thereby allowing the gas to escape and be captured.
The fluid used in fracking is about 99.5 percent water, with sand and chemicals constituting the rest of the mixture.
The sand is used as an agent to “prop” open the fractures and prevent them from closing up once the pressure is relieved. The chemicals, some of which are toxic, are used to speed the flow of water, to kill “any critters” in the pipeline and to keep the sand afloat, Taylor says.
“You can’t do it that way in North Carolina, so let’s update the law to reflect today’s technology,” he says. “We have to have some kind of system in place to account for current times. If gas companies could get the permits, they would want to drill next week. There’s money to be made.”
Natural gas is often promoted as the ideal interim energy source, or “bridge” fuel, in the transition away from coal and oil toward renewable energy.
Although geologic conditions in the Deep River basin are not ideal, similar conditions have yielded profitable operations in the Barnett Shale in Texas, the Haynesville Shale in Louisiana and the Marcellus Shale in Pennsylvania and other Northeastern states.
“Pennsylvania is the Saudi Arabia of natural gas right now,” says Bob Ganis, a geologist who lives in Southern Pines and consults for the mining industry. “I think there’s a misperception that you can drill anywhere, frack anywhere and get gas everywhere. That’s not true. There have been dry wells in Pennsylvania.
“There’s a lot of technology that has to be applied to delineate a potential gas-bearing zone. It has to be very carefully done because there’s the risk of spending millions of dollars on a well and it not producing anything.”
Value of Study Questioned
Taylor believes that is why there may never be any drilling in Moore County.
“There could always be a well sunk on speculation, but why spend $1 million to $1.5 million when there are proven fields elsewhere?” he says. “If I’m drilling wells, I’m going to go where I know I can make money.”
Which is why fracking is a global issue. But the point has virtually been moot in North Carolina in the past, because horizontal drilling is not allowed under the 1945 Oil and Gas Conservation Act.
“Right now, we have a safety blanket that other states don’t have,” says Geoff Gisler, a staff attorney for Southern Environmental Law Center. “If we allow fracking, we’ve got one chance to do it right.”
And that scares those opposed to fracking.
“We’re very much concerned because, frankly, there’s no way the state can do a good study for $100,000,” Hope Taylor says. “The number of topics covered by this study is larger than the EPA study, which has a budget of $4.3 million.”
The U.S. Environmental Protection Agency is conducting a comprehensive research study to investigate the potential adverse impact that fracking may have on water quality and public health. Preliminary results are expected next year, with the final report due in 2014.
“At the very least, we should wait until the end of the EPA study before we make any decisions,” Hope Taylor says. “But we always take a very precautionary view. We need to assume that legislators put a May 1 deadline on the state study so that they could do something in the next session. We need to be ready.”
The General Assembly has a short session in 2012 and normally considers only local bills during such a session.
“I would hope that would be the case again next year,” says Rep. Mike Stone, a Lee County Republican and a sponsor of HB 242. “Our bill is called the ‘Go Slow’ bill because there are a lot of questions and very few answers. We are either going to have the best fracking law in the country or the best reason not to do it.
“Right now, no one in Raleigh is an expert on drilling for natural gas.”
Discussion Grows Heated
Locally, that fact was underscored at a recent panel discussion on fracking that included Stone, Rep. Jamie Boles and Sen. Harris Blake. A standing-room-only crowd at the Southern Pines Civic Club grew increasingly frustrated over the course of two hours as their questions about fracking went largely unanswered.
“I don’t have a lot of factual knowledge,” Blake told the group. “We had to pass the legislation to get started. We are talking about a very important product that can be found in Moore County. I just don’t see the problem yet. But we’ve got to do it safely or we won’t do it.”
Boles also admitted to lacking facts.
“I’m learning just as much as you are,” he said. “There’s a lot to look into, and that’s why we’re proceeding cautiously. You have to look at everything, every hypothetical.”
While shale gas production through tax revenue and new jobs could have a profound economic impact in North Carolina, there are a plethora of environmental, legal, regulatory and policy concerns, especially since fracking is exempt from most federal regulations under the infamous “Halliburton Loophole.”
It earned that nickname because it was contained in the Energy Policy Act of 2005, which became law during the Bush/Cheney administration. Former Vice President Dick Cheney was once an executive at Halliburton, which developed fracking in 1949 as a means to lengthen the life of vertically drilled oil wells that were about to go dry.
Today, Halliburton is one of the largest suppliers of fracking technologies and chemicals.
Critics also note that industrial, legislative and lobbying pressures dating back to the 1980s have successfully enabled numerous other exemptions and favors for oil and gas companies.
The EPA recently proposed for the first time to control air pollution at gas wells after problems were reported in places such as Wyoming, Texas, Pennsylvania and Colorado, where fracking has led to a rush to obtain natural gas that was once considered inaccessible.
The proposed regulations are designed to eliminate most releases of smog- and soot-forming pollutants from gas wells. They also call for new controls on storage tanks, transmission pipelines and other equipment.
In March, pollution from natural gas drilling in western Wyoming triggered levels of ground-level ozone — the main ingredient in smog — worse than those recorded in Los Angeles, one of the smoggiest cities in the U.S.
Nationwide, thousands of complaints have been lodged with state and federal agencies by people whose lives have been adversely affected by fracking operations.
Activists face an uphill battle because of the corporate and political interests that they are fighting, the gargantuan amount of money at stake, and the ever-changing dynamics of the energy policy debate in the U.S.
There is no model state for North Carolina to follow because even the best state-level efforts to monitor the rapidly growing industry are not matched by adequate enforcement. And officials in states where drilling is allowed admit that keeping up with the industry is an enormous struggle.
“It’s unclear if fracking can be done safely with any set of safeguards,” says Molly Diggins, state director of the North Carolina Sierra Club. “We are generally supportive of natural gas as a transitional fuel as we move away from coal and oil. But there have been significant problems with how it’s extracted from the ground using fracking, especially in Pennsylvania and New York.
“We need to evaluate both the potential and the challenges. There are a lot of issues to resolve. It’s an interesting debate.”
Jon Parsons, executive director of Sustainable Sandhills, agrees that it’s “a little bit tough” to take a position.
“There’s more than tax revenue at stake here,” Parsons says. “It’s about groundwater resources, quality of life and the character of the community, among a lot of other things. “We’ve got such a great track record in this state of erring on the side of caution when it comes to groundwater resources. The highest and best use of water is for drinking.
“We don’t need an assurance from the gas industry, which wants the green light to proceed. Rushing into fracking without studying it just doesn’t seem prudent. We’re advocating a take-it-slow approach.”
Hope Taylor, who also serves on the National Drinking Water Advisory Council, believes that fracking should remain illegal, noting that France became the first country to totally ban the practice in June.
“The impacts to public health, our water, the environment and local economies are too great, from everything we’ve seen in other states where fracking is allowed, to permit fracking to move forward in North Carolina,” she says. “We just don’t believe that the regulatory, geological or infrastructure conditions exist for this to be done safely.”
‘People Are Scared’
Her regulatory concerns are shared by fellow critics who point to Senate Bill 781, which became law last month after the General Assembly overrode Gov. Beverly Perdue’s veto.
The bill reforms the state’s regulatory system at a time when the state Department of Environment and Natural Resources (DENR) has been tasked with leading the exploration of regulations on fracking.
The situation would have been exacerbated had the General Assembly overridden Perdue’s veto of Senate Bill 709, which could potentially allow fracking more quickly than HB242. Republicans apparently did not have enough votes before the legislature adjourned last month, but they could raise the issue again during a special session that begins Sept. 12.
“The problem with 709 is that it’s more of a pedal-to-the-metal approach,” Diggins says. “It has a presumption that we’re going to frack.”
Ganis understands the concerns, but adds that fracking has become “a Boogie Man name and it shouldn’t be.”
“People are scared of this,” Ganis says. “You can’t ever eliminate the nitwit factor. There will be nitwits who occasionally do something stupid. But the potential downfall is nominal as long as you establish the proper safeguards up front.
“I wouldn’t like to see fracking denied in North Carolina for the wrong reasons. Let’s not shoot ourselves in the foot.”
‘Drop in the Bucket’
Dan Butler, 68, of Southern Pines, is uniquely positioned to assess fracking because he owns mineral rights in Pennsylvania and Lee County.
“This is a big deal for North Carolina, but it’s not a major play,” Butler says. “It’s a drop in the bucket compared with Pennsylvania and New York.”
Butler is currently negotiating with several gas companies for the right for one of them to drill the mineral rights that he owns near Kane, Pa., where he spent summers as a youth with his grandparents.
“The ball is in my court,” he says. “I am doing my due diligence. I don’t know if there’s any Marcellus gas on the property, because no wells have been drilled. It would be a real blessing if they found Marcellus gas. The Lord placed it there. I’ve done nothing. It’s something I inherited from my parents.”
Butler has leased the mineral rights to more than 2,700 acres in Lee County to WhitMar Exploration Co. of Denver. He already has two test wells on the property that successfully tapped natural gas in 1998, but full-scale production never began because it would have cost $40 million at the time to connect to the nearest pipeline.
“My dad (Howard Butler) always felt there was natural gas and that you could extract the gas,” Butler says. “He was always ahead of his time. North Carolina is very wise in that they are studying the issue and getting the right information to make good laws.”
He likens fracking to flying.
“Nothing is perfect,” Butler says. “You’re going to have an occasional accident.”
‘Would Not Be Pretty’
In May, U.S. Secretary of Energy Steven Chu appointed a panel of seven scientific and environmental experts to study fracking and to make recommendations about how it can be done more safely and more cleanly. Chu gave the panel 90 days to come up with immediate recommendations and six months to provide consensus advice.
“America’s vast natural resources can generate many new jobs and provide significant environmental benefits,” Chu said at the time, “but we need to harness these resources safely.”
The experience in other states has been that once the gas industry mounts a campaign, it gets permission to drill. And once drilling starts, state regulators struggle to keep up.
Experts say decisions regarding the extent to which natural gas extraction should be regulated must balance public health and safety, energy needs, and the inevitable bureaucracy that regulation brings.
Many believe that fracking would benefit from sustained scientific study, a review of the potential health consequences in drinking water, industry-driven approaches to develop safer and more consistent extraction technologies, and consideration of stronger state or federal regulation.
In short, both the promise and peril of fracking appear to be substantial, and the debate will be heated. The full extent of the problems associated with fracking is difficult to determine because much of the evidence is anecdotal. Both drilling critics and supporters use the confusion to their advantage, often talking past one another when discussing the consequences.
Parsons, of Sustainable Sandhills, has an answer that will end the debate in North Carolina: Keep the practices illegal.
“The North Carolina regulations currently in place are the last best defense against fracking,” he says. “Fracking would really change the character of the rural countryside. The transformation would be to what you see in other states, which looks like an industrial landscape.
“You’d have these gas rigs scattered across the countryside. It would not be pretty.”
Contact Ted M. Natt Jr. at firstname.lastname@example.org.
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