Our Perspectives Archives - Page 12 of 16

EPA: Fracking and Groundwater Contamination

December 9, 2011/by FracTracker Alliance

Pavillion, WY

The Internet is alive today after the U.S. Environmental Protection Agency released a report that indicates hydraulic fracturing (used when drilling for natural gas in tight shale formations) can contaminate groundwater. Residents of Pavillion, WY have been complaining about the state of their groundwater for some time now. The draft EPA report lends credibility to their claims with the finding that chemicals associated with the process were found in some deep water aquifers in the area. And when you look at all of the evidence around this issue – outside of the EPA’s study – the results are even more ‘ground-breaking.’

Having said that, there are a few questions regarding the EPA report/research. No field study could ever account for all of the potential confounders and variables – especially given the amount of resources the EPA had at its disposal to conduct this work. However, some of the most significant questions that I would like to see answered before this draft is finalized include:

How representative is the data from the two monitoring wells in relation to residents’ drinking water wells?
Has the potential for surface contamination of the monitoring wells been ruled out?
Why weren’t the duplicate samples that were analyzed by separate labs also able to detect 2-BE?

These questions (and surely more) are exactly why this is only a draft report. According to the EPA, it will be available for a 45-day public comment period. A subsequent 30-day peer-review process will be led by a panel of independent scientists to ensure that the results that stay on the records are accurate.

DEP = Department of…Economic Promotion?

October 22, 2011/by Matt Kelso, BA

In today’s Post-Gazette, Laura Olson quotes the DEP Deputy Secretary of Oil and Gas Management Scott Perry refuting the notion that hydraulic fracturing is an unregulated process, saying:

“It’s important to point this out, because I think if the public loses confidence in the department’s ability to manage this industry, it’s going to have some consequences and perhaps some unfortunate policy decisions will be made. It ultimately will result in less opportunities for everyone.”

In times like these, isn’t it nice to know that even the Department of Environmental Protection has the economy foremost on their minds?

“I feel like I’m trying to convince the public that Sasquatch doesn’t exist.”

Hasn’t anyone told him? There have been 951 confirmed Sasquatch sightings in the Marcellus Shale portion of the Commonwealth so far this year.

Even if I’m taking this quote of Perry slightly out of context, the point remains valid: The DEP stands for the Department of Environmental Protection. That’s what they should talk about, and denying that there are problems doesn’t make it seem like they are paying any attention to their own data.

Flood Control and Shale Gas Wells

October 11, 2011/by FracTracker Alliance

Flooding from Hurricane Irene in Wilkes-Barre PA

Photo Credit: Salvation Army, Randall Thomas, Wilkes-Barre, PA

Pennsylvania is no stranger to water and flooding, as we receive between 38 and 45 inches of rain per year on average. Unfortunately, the storms that hit the region starting on August 27th were more than we could handle – to say the least. During this time Hurricane Irene and the remnants of Tropical Storm Lee burdened the eastern portion of the state with flooding at water levels that rivaled Hurricane Agnes (1972).

While most residents hit hardest by flooding focused on protecting their families, homes, and livelihoods, others throughout the Commonwealth were also concerned about the impact that rising water levels could have on natural gas well pads. This is especially an issue for those sites operating in floodplains with open frac ponds. According to the reports we have been able to gather no shale gas well sites were compromised or sustained environmental damage in PA. Apparently, Marcellus Shale drillers were advised to prevent overflows from wastewater/’frac’ ponds by the governor, although due to a communication loophole it is unclear as to whether all of the relevant sites temporarily shut down during the inclement weather. Regardless, with the number of wells being drilled in PA especially in the northeast, being able to prevent any incidents during these storms is quite a feat on the part of the drillers and should be recognized as such. Industry reports also indicate that drilling companies provided financial contributions, expertise, equipment, work hours, and supplies to aid in the flood relief efforts. Learn more about these contributions here.

We ask that if you have any knowledge that contradicts this information, please let us know and contact your local representative to report the incident.

Severance Tax vs. Impact Fee, Revisited

October 3, 2011/by Matt Kelso, BA

It may not seem like it when you head to the pump, but the price of oil has plummeted in recent months. After peaking near $114 in April, the price has fallen all the way to $77.27, as of today. Natural gas, which was $4.27 last month, has fallen 15 percent since then to $3.62. Surely with all of this uncertainty, the Corbett’s proposed impact fee makes more sense than the traditional severance tax which most states use? Perhaps it would be better to take the predictable lump-sum amount than basing that portion of the state’s coffers on the vagaries of the market?

No, not really.

Corbett’s plan allows the counties to charge up to $40,000 per well per year, for a period of up to 10 years per well. According to the Post-Gazette, his administrations figures it could bring in $120 million in the first year, and up to $200 million per year by the sixth year.

Or, as I pointed out in June, we could tax like Texas. Texas imposes a 7.5% severance tax on natural gas and 4.6% tax on oil and condensate. Using yearlong production data for non Marcellus Shale wells in Pennsylvania and the average wellhead price of gas and price per barrel of liquid hydrocarbons for 2010, I estimated that non-Marcellus wells would have brought in $72.5 million if we taxed our resources just like Texas does. What’s more, based on six month production data, I showed that the wells in the Marcellus Shale formation would produce at least $173 million, for a statewide total of $246 million through all formations.

But that was before the bottom fell out of the price of oil and gas. What if we used today’s low prices as a guide?

Estimated six month severance tax from the Marcellus Shale formation in Pennsylvania.

Even with the low energy prices, that six month total is almost as much as Corbett’s administration figures to raise in a year, and it doesn’t even include the tens of thousands of wells that aren’t drilled into the Marcellus Shale.

While the proposed impact fee does more for Pennsylvania than the current nothing-at-all policy, in the scheme of things, it is a great deal for the drilling industry.

And one final aside: does it seem strange to anyone else to let the counties set the impact fee? Is this some sort of attempt to have them compete with each other to keep the prices low? If so, it seems unlikely to work in my opinion. If a county charges the maximum $40,000, that represents only about 0.8 percent of cost of a well that costs $5 million to drill, and that figure is on the low end of the spectrum. The drilling companies will want to drill where the resources are, and whatever fees or taxes are charged will not change that fact.

If It’s Unsuitable For Mining, Is Drilling Advisable?

September 14, 2011/by Matt Kelso, BA

There are a handful of watersheds, predominantly in central Pennsylvania, that the Department of Environmental Protection has deemed to be unsuitable for mining activities.

According to pages 100-101 of the Oil and Gas Operator’s Manual, a region may be determined to be unsuitable for mining if the mining operation will:

be incompatible with existing State or local land use plans or programs;
affect fragile or historic lands in which such operations could result in significant
damage to important historic, cultural, scientific and esthetic values and natural
systems;
affect renewable resource lands in which such operations could result in a
substantial loss or reduction of long-range productivity of water supply or of
food or fiber products, and such lands to include aquifers and aquifer recharge
areas; or
affect natural hazard lands in which such operations could substantially
endanger life and property, such lands to include areas subject to frequent
flooding and areas of unstable geology.

Marcellus Shale permits that were issued in areas which were deemed to be “unsuitable for mining” according to the PA DEP in 2002.

These seem like worthy goals. So if these areas are unsuitable for coal mining, why is it OK to put gas wells there?

Surface coal mine. Source: http://en.wikipedia.org/wiki/File:Coal_mine_Wyoming.jpg

Granted, drilling a well is not quite the same impact as a surface mining operation, but to protect an area from one mode of mineral extraction and not the other seems inconsistent. After all, many of the problems with coal are still relevant for gas drilling, since the drilling operator must go through the coal seam to get to the gas. The pyrite associated with the coal is still exposed to air, meaning that the drilling mud and drill cuttings probably contain sulfuric acid, the key component of acid mine drainage (AMD).

And it’s not just the drill cuttings that could be a source of problems…it could be the well bore itself. Consider the Hughes Bore Hole, which, according to Wikipedia was drilled in the 1920’s to drain underground mines in the area, then capped in the 1950’s. So what’s the big deal? In the 1970’s, pressure built up and the hole burst open, and has been spewing about 800 gallons per minute of acid mine drainage ever since.

Hughes Bore Hole releasing acid mine drainage. Source: http://en.wikipedia.org/wiki/File:Hughe%27s_Bore_Hole_071.jpg

Could drilling a gas well in the wrong place have the same effect?

Maybe to be safe we ought not drill in areas where geologists have determined that AMD could exist. That wouldn’t affect that many wells, would it?

Marcellus Shale permits in areas with acid mine drainage potential. Please click the map for a dynamic view and more information.

Oh. Well then let’s hope the well casing experts don’t have any bad days.

[Note: if you want to watch a video of Hughes Bore Hole and don’t mind salty language, click the Youtube link on the “Hughes Well Bore” link above.]

Marcellus Shale Production Decline Over Time in Pennsylvania

September 5, 2011/by Matt Kelso, BA

There are now three different Marcellus Shale production reports available on FracTracker’s DataTool:

The production data, which is self-reported by the drilling operators, is also available from the Pennsylvania Department of Environmental Protection.

In this post, we will explore the change in production from the 756 Marcellus Shale wells that reported positive (nonzero) production on each of the three reports. Of these, exactly 300 were flagged as horizontal wells on the most recent report, leaving 456 to be classified as vertical wells.

Marcellus Shale production in Pennsylvania from January to June, 2011. Please click the image to see a zoomable and dynamic map.
Caveats
It is important to note that the first of the three production cycles is for a one year period, while the other two are for six months each. Luckily, each report includes not only production in thousands of cubic feet (Mcf), but also the number of days for which each well was in production. Therefore, we can look at the data in terms of thousands of cubic feet per day (McfPD), which solves not only the 12 month vs. 6 month problem, but also makes sure that we aren’t comparing six months of production to just a handful of days.

One important factor that this analysis does not account for, however, is when the well first entered production. This is significant, because gas wells typically have a very high initial production, which falls steeply in the months and years ahead. This produces a hyperbolic decline curve, such as this Department of the Interior graph found on Wikipedia.

In this case, we only know that the initial production was some time since 2006 and before June 30, 2010. Add to that fact that there are only three date ranges, and the result is definitely not a proper decline curve.

Results
However, there are results, and they do show decline over time. Interestingly, there are some differences to note between horizontal and vertical Marcellus Shale wells.

Average Marcellus Shale production in thousands of cubic feet (Mcf) for wells on all three production reports.

Average Marcellus Shale production showing rates of decline.

The overall production of the sample decreased 40.7 percent from the period ending June 2010 to the one ending one year later. Interestingly, the vertical wells are declining at a sharper rate than horizontal wells, although not dramatically so.

The chart also highlights the amazing difference in production that horizontal drilling provides to Marcellus Shale wells, with average production values 5.6 to 6.9 times higher than their vertical counterparts.

What’s Missing?
Not all of the Marcellus Shale wells from the July ’09 to June ’10 list were still reporting production for the period that ended one year later. These wells were not included in the above analysis, but are interesting in their own right:

Number of Marcellus Shale wells on the production report for the period ending June 2010 that are also reporting production one year later.

Surprisingly, the rate for horizontal wells no longer producing gas is more than twice as high as their vertical counterparts. Does this mean that a side effect of horizontal drilling is a shorter well production life, as all of the gas is extracted faster? We’ll have to wait and see what future data shows to find out.

Groundwater Contamination Debate

August 4, 2011/by FracTracker Alliance

The Debate: Can the process of hydraulically fracturing underground natural gas wells contaminate groundwater?

Industry Position: There has never been a documented case of groundwater contamination due to hydraulic fracturing; the process occurs thousands of feet below drinking water aquifers. Therefore, the chemicals used in the fracturing process pose no threat to drinking water.

Opposition Position: It can and has contributed to pollution of underground drinking water sources.

The Data: Previous lawsuits from landowners were settled by the industry and the data kept private for various litigation reasons. A U.S. EPA report now indicates that hydraulic fracturing has been linked to at least one case of drinking water contamination in West Virginia in 1987 and could feasibly contribute to future problems.

Future Obligations: Some improved regulations and protections have been put in place since 1987, but the risk still exists if natural gas drilling is done hastily or if abandoned wells exist nearby. Once pollutants are introduced into underground water aquifers they are very difficult to remove, so significant care and review must be taken if drilling is going to continue. The EPA report further supports the need for increased government and industry transparency across the board. It should also be stated that a large-scale health impact assessment is needed to comprehensively determine the risk that the entire natural gas drilling operation poses to public health.

Compiled by: Samantha Malone, MPH, CPH – Communications Specialist, Center for Healthy Environments and Communities (CHEC), Environmental and Occupational Health (EOH) department, University of Pittsburgh Graduate School of Public Health (GSPH); and Doctoral Student, GSPH

Comparing & Contrasting Extractive Industry Sectors in Ghana & the US

August 3, 2011/by FracTracker Alliance

By Deanna Bitetti (Common Cause) and Samantha Malone, MPH, CPH (CHEC)

In the quiet of the morning the group we have travelled to Ghana with using a grant from the US Department of State to study extractive industries find ourselves swapping stories – wistfully thinking of American life back home. We find ourselves constantly comparing and contrasting the political environment in which public policy around extractive industries are crafted in both nations. Scratch beneath the surface and you will find that Ghana and the US are not that different after all.

The pernicious influence of special interest money permeates throughout American political culture just as it does in Ghana; compulsory Integration models in the states have allowed for mineral rights to be taken from American citizens, and confusion over the leasing of mineral rights for natural gas extraction has led to uprooted communities. Environmental degradation and costs to local communities have been paramount in both the US and Ghana. These two nations separated by the Atlantic are struggling to balance new extractive industries as an engine for economic growth and protecting communities from the pitfalls associated with the “resource curse.” As both nations forge ahead in developing their oil and gas sectors, how they manage the risk associated with natural gas development will ultimately define how the citizenry thinks about the role of government and government institutions.

Below is a short comparison of some key aspects affecting constituencies in the US and Ghana.

Special Interest Influence

During a recent discussion with a local royal chief in a small village I am reminded that corporate influence is not localized to any specific nation. Here, a gold mining company publicly presents the tribal leaders of a village with keys to two Land Rovers. In America, special interest money floods campaign coffers, exceedingly so in the wake of Citizen United. According to Open Secrets individuals and political action committees affiliated with oil and gas companies have donated $238.7 million to candidates since 1990. From 2010-2011 Exxon Mobil and The Koch Brothers, one of the largest oil and gas conglomerates in the US, spent $384,030 and $318,800 respectively on campaign donations on both sides of the partisan divide to influence environmental legislation aimed at regulating the oil and gas sector. In Pennsylvania, Common Cause’s www.marcellusmoney.org has tracked the significant campaign cash contributions that have flooded campaign coffers, and in New York our recent report “Deep Drilling, Deep Pockets,” highlighted the large amounts industry has spent to lobby our elected officials.

Public Benefits for Public Good

In Ghana only 5% of royalties paid by the extractive industry sector is paid to the State. Out of that 80% of the money goes into the government’s general fund, with only 9% trickling down to effected communities. In the US, Congress has historically rewarded energy companies and those involved in the extractive industry sector with tax breaks, without tangible realization of positive benefits to communities. Nearly two-thirds of US corporations don’t pay any income taxes. According to a study from the non-partisan Government Accountability Office, 83 of the top 100 publicly traded corporations that operate in the US exploit corporate tax havens. Since 2009, America’s most profitable companies, such as ExxonMobil, General Electric, Bank of America and Citigroup, all paid a grand total of $0 in federal income taxes. Even as we write this, Congress is considering offering major subsidies to promote natural gas extraction methods and providing major tax incentives to the industry, speeding up the timeline for extraction and feeding the natural gas boom (and possibly bust) cycle.

Mineral Rights and Extraction

At the heart of the debate over natural gas extraction in the US is the right of landowners to either retain their land or sign leases with companies with the hope of negotiating lucrative contracts for their mineral rights. In Ghana, Article 257 of the Constitution states that public lands and public property are “vested in the President on the behalf of, and in trust for, the people of Ghana.” In essence, the state has claims to mineral rights, not the individual. On the surface the situation in Ghana appears anathema to American values. Forced resettlement programs of thousands of fisherman, farmers and landowners offends our notion of private property and ownership as inviolate. Yet areas in New York and Pennsylvania have allowed for Compulsory Integration where companies were granted the right to drill on lands for which they did not hold leases. Some residents that may own the surface rights but not the mineral rights experience the effects of a “split estate.” Additionally, population displacement often occurs near areas of heavy drilling either because of fear of health effects, noise or pollution, or due to harassment by companies. The important benefits and drawbacks that result from personal ownership of mineral rights must be considered seriously. Further, neither the United States or Ghana require companies to disclose the exact composition of the chemical mixtures used in the process, shrouding it in a cloud of secrecy from the public.

Externalities of Natural Gas Development

In Ghana, as farmland is turned over to industry to pave the way for rapid development, food productivity has begun decreasing – causing food and commodity prices to rise. Housing prices have been steadily increasing as foreigners flock to the areas surrounding the Jubilee oil field, causing a surge in demand for those residences. Prostitution and crime has been on the rise, as well. Even smoking has increased as foreigners bring with them new social norms. In the US we have seen similar externalities imposed on host communities by the extractive industry sector. In Pennsylvania we have already seen the rise in housing shortages due to workers being brought in from out of state, traffic incidences, and roadway degradation. Air quality concerns, drinking water contamination, and stress-related health effects are being documented. Both nations lack clear and updated standards for hazardous waste removal of drilling fluid or drill cuttings. Each country will have to address new pressures placed on transportation infrastructure, including increasing maintenance costs as new roads are created and old roads need constant repair to handle the increase in heavy truck traffic.

Public Health Issues

Residential and operational waste – regardless of its country of origin – is a common postcard to receive from the presence of extractive industries. Improperly handled waste contributes to a multitude of public health issues, such as tainted drinking water, disease transmission, air pollution, and threats to the food supply. One of the differences between Ghana and the U.S. lies in the awareness of where our waste goes. Americans are physically separated from the sources and end products of our distracted commercial lives. Trash is collected by a contractor and taken to dump sites, incinerators, or overseas. Ghanaians face their (and others’) waste on the country’s busy sidewalks, in open sewers, and floating in their magnificent waterways. They witness the neocolonial exploitation of their local resources for the imbalanced consumption and financial gain of other countries. While our processes for extraction and waste disposal differ somewhat, we share a common problem – how to reduce our demand on the entire cycle. Many of the earth’s resources are finite and severely threatened, and so sustainability must be the prescription for healthy development.

Conclusion

This list is not exhaustive, nor it is it meant to be. To move toward a best-practices model for developing extractive industry sectors and managing the high risks associated with doing so means paying close attention to the pace and scope of development, as well as attempting to ameliorate negative externalities imposed on communities. This must include mechanisms for proper oversight and regulation, sustainable planning and development, enhanced civic societal input at the decision- making table, and realistic expectations about the financial promises of oil and gas. In nations such as Ghana, managing these revenues will require more transparency and better management to ensure that revenues do not create large wealth distribution imbalances. In the US, ensuring that industry and government do not form cozy relationships that undermine independent oversight regimes is a major concern.

Deanna Bitetti is the Associate Director of Common Cause/NY. Samantha Malone is the Communications Specialist at the Center for Environmental Healthy Environments and Communities and a doctorate student in the University of Pittsburgh Graduate School of Public Health. They are currently in Ghana as part of a State Department funded research trip on resource extraction hosted by Duquesne University (Pittsburgh, Pennsylvania) and the University of Ghana (Legon, Ghana).

Paid Marcellus Programming to Play in West Virginia

July 16, 2011/by Matt Kelso, BA

Who doesn’t love a good half hour commercial? But it’s not just for OxiClean and musical compilations of 70’s disco tunes anymore–the West Virginia Oil and Natural Gas Association is getting in on the act too.

In addition to the half hour weekly episode of “Inside Shale”, in which callers ask questions of industry insiders, there will be a “Marcellus Minute” that airs 10 to 20 times per day. Both programs are scheduled to launch on 49 radio stations throughout West Virginia.

Talking about the Marcellus Shale on the radio is certainly not off limits, but the industry sponsored call in show does sound questionable, in that the format mimics a news format, and it could be confused as such. It’s a shame that the industry didn’t push for actual moderated discussions, with guests arguing from a variety of perspectives. That is something that there’s a real need for, not just in West Virginia, but wherever shale gas extraction is occurring.

There are real impacts of drilling. Some people are giddy with prospective royalty checks. Others are bitter with the presence of compressors, condensers, and fouled water wells on property that they own, but not the mineral rights for. There’s a lot to talk about, and communities that might be affected by the industry deserve to hear both sides.

Data Transparency Bill Will Aid Emergency Response

May 25, 2011/by FracTracker Alliance

Fire in Hopewell Township PA,
Southwestern PA on 3-31-10

Earlier this week, a Pennsylvania Senate committee approved a bill that would require natural gas drilling companies to provide emergency response information to local authorities. Here are the key requirements of drilling companies that are being proposed:

Post emergency response information at each well site
Register distinct geographic coordinates for each drilling site with the PA Department of Environmental Protection and local authorities
File response plans with the local authorities, local 911 center, PA DEP, and PA Emergency Management Agency

Inadequate data transparency of this type has been a significant public health concern ever since natural gas drilling first began in the Marcellus Shale region in PA.Marcellus Shale sites are often drilled in rural, remote areas without exact location information or clear emergency plans. If passed into law, this legislation stands to decrease the response time in the event of an emergency at a well site, reducing the impact that drilling incidents may have on public health and the environment.

To demonstrate why improving the quality and expediency of emergency response to shale gas drilling incidents is an important endeavor, below is a map created on FracTracker’s DataTool showing only the location of violations issued by the PA DEP in 2010 to companies that were drilling into the Marcellus Shale layer. If you press “Click to see more details on this map,” you can use the DataTool to filter the dataset even further in order to see which of these violations was an environmental health and safety violation, not just administrative in nature:

(Darker diamonds indicate there was more than one violation issued in that area. Zoom in to learn more.)