Oil & Gas Activity in Tennessee

We are slowly adding oil and gas information related to Tennessee to FracTracker.org. This page will update as more maps and articles are developed about TN. Check back soon!

Data on TN’s class II injection wells can be downloaded here. Last updated: February 25, 2019

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Happy Earth Day

What difficult times. The pandemic is beyond our common experience. Deadly and pervasive, it afflicts our physical wellbeing and our economy. The virus exposes and exploits the inequities in society, with harsh, disproportionate burdens on those most marginalized. The suffering sickens us to the core.

Hope is an essential nutrient manifesting in different, often unassuming, forms. The 50th anniversary of Earth Day, while dampened by our current troubles, reminds us of the tenacity and resiliency of the human spirit.

A small idea, sparked in 1970, blossomed into a global observance. People mobilized by the thousands to testify to the defilement of the planet and to demand bold action. In the story map below, take a tour through 50 years of technology, protest, economics, and policy that shaped the country’s energy landscape. Witness the power of people bringing dramatic changes to our energy system, despite forces working to preserve the status quo.

The 50th occurrence of Earth Day presents a ripe opportunity to honor the dedication and sacrifice of those who help keep our lights on and celebrate the bravery of those fighting to build an energy system that ensures environmental and economic justice for all.

Physical gathering is a bad idea but intellectually, virtually, we can elevate the dialogue and plant good seeds, literal and figurative, to accelerate restoration and cool our climate. The constraints of COVID-19 reveal the virtue of simplicity, the conservation bounty of taking the slower road, where every milepost matters.

Plug in however, wherever you can. Look for local chances to engage. Check out the Earth Day Network for digital events near and far or plan your own action.

Make a statement, take a stand, and write the future.

Wishful thinking? Maybe, but as a wise-old band once sang, “Don’t Stop Believing.”

Explore the Story Map

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COVID-19 and the oil & gas industry

COVID-19 and the oil and gas industry are at odds. Air pollution created by oil and gas activities make people more vulnerable to viruses like COVID-19. Simultaneously, the economic impact of the pandemic is posing major challenges to oil and gas companies that were already struggling to meet their bottom line. In responding to these challenges, will our elected leaders agree on a stimulus package that prioritizes people over profits?

Health Impacts of COVID-19 and Oil & Gas 

People living in areas with poor air quality may be more vulnerable to COVID-19, a disease that affects the lungs. Poor air quality is linked to higher rates of asthma and chronic obstructive pulmonary disease (COPD), even without a pandemic.

Air pollution from oil and gas development can come from compressor stations, condensate tanks, construction activity, dehydrators, engines, fugitive emissions, pits, vehicles, and venting and flaring. The impact is so severe that for every three job years created by fracking in the Marcellus Shale, one year of life is lost due to increased exposure to pollution. 

Yes, air quality has improved in certain areas of China and elsewhere due to decreased traffic during the COVID-19 pandemic. But despite our eagerness for good news, sightings of dolphins in Italian waterways does not mean that mother earth has forgiven us or “hit the reset button.”

Significant environmental health concerns persist, despite some improvements in air quality. During the 2003 SARS outbreak, which was caused by another coronavirus, patients from areas with the high levels of air pollution were twice as likely to die from SARS compared to those who lived in places with little pollution.

On March 8th, Stanford University environmental resource economist Marshall Burke looked at the impacts of air quality improvements under COVID-19, and offered this important caveat: 

“It seems clearly incorrect and foolhardy to conclude that pandemics are good for health. Again I emphasize that the effects calculated above are just the health benefits of the air pollution changes, and do not account for the many other short- or long-term negative consequences of social and economic disruption on health or other outcomes; these harms could exceed any health benefits from reduced air pollution.  But the calculation is perhaps a useful reminder of the often-hidden health consequences of the status quo, i.e. the substantial costs that our current way of doing things exacts on our health and livelihoods.”

This is an environmental justice issue. Higher levels of air pollution tend to be in communities with more poverty, people of color, and immigrants. Other health impacts related to oil and gas activities, from cancer to negative birth outcomes, compromise people’s health, making them more vulnerable to COVID-19. Plus, marginalized communities experience disproportionate barriers to healthcare as well as a heavier economic toll during city-wide lockdowns.

Financial Instability of the Oil & Gas Industry in the Face of COVID-19 

The COVID-19 health crisis is setting off major changes in the oil and gas industry. The situation may thwart plans for additional petrochemical expansion and cause investors to turn away from fracking for good.

Persistent Negative Returns 

Oil, gas, and petrochemical producers were facing financial uncertainties even before COVID-19 began to spread internationally. Now, the economics have never been worse

In 2019, shale-focused oil and gas producers ended the year with net losses of $6.7 billion. This capped off the decade of the “shale revolution,” during which oil and gas companies spent $189 billion more on drilling and other capital expenses than they brought in through sales. This negative cash flow is a huge red flag for investors.  

“North America’s shale industry has never succeeded in producing positive free cash flows for any full year since the practice of fracking became widespread.” IEEFA

 

Plummeting Prices

Shale companies in the United States produce more natural gas than they can sell, to the extent that they frequently resort to burning gas straight into the atmosphere. This oversupply drives down prices, a phenomenon that industry refers to as a “price glut.”

The oil-price war between Russia and Saudi Arabia has been taking a toll on oil and gas prices as well. Saudi Arabia plans to increase oil production by 2 – 3 million barrels per day in April, bringing the global total to 102 million barrels produced per day. But with the global COVID-19 lockdown, transportation has decreased considerably, and the world may only need 90 million barrels per day

If you’ve taken Econ 101, you know that when production increases as demand decreases, prices plummet. Some analysts estimate that the price of oil will soon fall to as low as $5 per barrel, (compared to the OPEC+ intended price of $60 per barrel). 

Corporate welfare vs. public health and safety

Oil and gas industry lobbyists have asked Congress for financial support in response to COVID-19. Two stimulus bills in both the House and Senate are currently competing for aid.

Speaker McConnell’s bill seeks to provide corporate welfare with a $415 billion fund. This would largely benefit industries like oil and gas, airlines, and cruise ships. Friends of the Earth gauged the potential bailout to the fracking industry at $26.287 billion. In another approach, the GOP Senate is seeking to raise oil prices by directly purchasing for the Strategic Petroleum Reserve, the nation’s emergency oil supply.

Speaker Pelosi’s proposed stimulus bill includes $250 billion in emergency funding with stricter conditions on corporate use, but doesn’t contain strong enough language to prevent a massive bailout to oil and gas companies.

Hopefully with public pressure, Democrats will take a firmer stance and push for economic stimulus to be directed to healthcare, paid sick leave, stronger unemployment insurance, free COVID-19 testing, and food security. 

Grasping at straws

Fracking companies were struggling to stay afloat before COVID-19 even with generous government subsidies. It’s becoming very clear that the fracking boom is finally busting. In an attempt to make use of the oversupply of gas and win back investors, the petrochemical industry is expanding rapidly. There are currently plans for $164 billion of new infrastructure in the United States that would turn fracked natural gas into plastic. 

Belmont Cracker Plant - Potential Petrochemical Infrastructure in the Ohio River Valley

The location of the proposed PTTGC Ethane Cracker in Belmont, Ohio. Go to this map.

There are several fundamental flaws with this plan. One is that the price of plastic is falling. A new report by the Institute for Energy Economics and Financial Analysis (IEEFA) states that the price of plastic today is 40% lower than industry projections in 2010-2013. This is around the time that plans started for a $5.7 billion petrochemical complex in Belmont County, Ohio. This would be the second major infrastructural addition to the planned petrochemical buildout in the Ohio River Valley, the first being the multi-billion dollar ethane cracker plant in Beaver County, Pennsylvania.

Secondly, there is more national and global competition than anticipated, both in supply and production. Natural gas and petrochemical companies have invested in infrastructure in an attempt to take advantage of cheap natural gas, creating an oversupply of plastic, again decreasing prices and revenue. Plus, governments around the world are banning single-use plastics, and McKinsey & Company estimates that up to 60% of plastic production could be based on reuse and recycling by 2050. 

Sharp declines in feedstock prices do not lead to rising demand for petrochemical end products.

Third, oil and gas companies were overly optimistic in their projections of national economic growth. The IMF recently projected that GDP growth will slow down in China and the United States in the coming years. And this was before the historic drop in oil prices and the COVID-19 outbreak.

“The risks are becoming insurmountable. The price of plastics is sinking and the market is already oversupplied due to industry overbuilding and increased competition,” said Tom Sanzillo, IEEFA’s director of finance and author of the report.

The Show’s Over for Oil & Gas 

Oil, gas, and petrochemical companies are facing perilous prospects from demand and supply sides. Increasing supply does not match up with decreasing demand, and as a result the price of oil and plastics are dropping quickly. Tens of thousands of oil and gas workers are being fired, and more than 200 oil and gas companies have filed for bankruptcy in North America in the past five years. Investors are no longer interested in propping up failing companies.

Natural gas accounts for 44% of electricity generation in the United States – more than any other source. Despite that, the cost per megawatt hour of electricity for renewable energy power plants is now cheaper than that of natural gas power plants. At this point, the economy is bound to move towards cleaner and more economically sustainable energy solutions. 

It’s not always necessary or appropriate to find a “silver lining” in crises, and it’s wrong to celebrate reduced pollution or renewable energy achievements that come as the direct result of illness and death. Everyone’s first priority must be their health and the health of their community. Yet the pandemic has exposed fundamental flaws in our energy system, and given elected leaders a moment to pause and consider how we should move forward.

It is a pivotal moment in terms of global energy production. With determination, the United States can exercise the political willpower to prioritize people over profits– in this case, public health over fossil fuel companies.

Top photo of petrochemical activity in the Houston, Texas area. By Ted Auch, FracTracker Alliance. Aerial assistance provided by LightHawk. 

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National Energy and Petrochemical Map

FracTracker Alliance has released a new national map, filled with energy and petrochemical data. Explore the map, continue reading to learn more, and see how your state measures up!

The items on the map (followed by facility count in parenthesis) include:

         For oil and gas wells, view FracTracker’s state maps. 

This map is by no means exhaustive, but is exhausting. It takes a lot of infrastructure to meet the energy demands from industries, transportation, residents, and businesses – and the vast majority of these facilities are powered by fossil fuels. What can we learn about the state of our national energy ecosystem from visualizing this infrastructure? And with increasing urgency to decarbonize within the next one to three decades, how close are we to completely reengineering the way we make energy?

Key Takeaways

  • Natural gas accounts for 44% of electricity generation in the United States – more than any other source. Despite that, the cost per megawatt hour of electricity for renewable energy power plants is now cheaper than that of natural gas power plants.
  • The state generating the largest amount of solar energy is California, while wind energy is Texas. The state with the greatest relative solar energy is not technically a state – it’s D.C., where 18% of electricity generation is from solar, closely followed by Nevada at 17%. Iowa leads the country in relative wind energy production, at 45%.
  • The state generating the most amount of energy from both natural gas and coal is Texas. Relatively, West Virginia has the greatest reliance on coal for electricity (85%), and Rhode Island has the greatest percentage of natural gas (92%).
  • With 28% of total U.S. energy consumption for transportation, many of the refineries, crude oil and petroleum product pipelines, and terminals on this map are dedicated towards gasoline, diesel, and other fuel production.
  • Petrochemical production, which is expected to account for over a third of global oil demand growth by 2030, takes the form of chemical plants, ethylene crackers, and natural gas liquid pipelines on this map, largely concentrated in the Gulf Coast.

Electricity generation

The “power plant” legend item on this map contains facilities with an electric generating capacity of at least one megawatt, and includes independent power producers, electric utilities, commercial plants, and industrial plants. What does this data reveal?

National Map of Power plants

Power plants by energy source. Data from EIA.

In terms of the raw number of power plants – solar plants tops the list, with 2,916 facilities, followed by natural gas at 1,747.

In terms of megawatts of electricity generated, the picture is much different – with natural gas supplying the highest percentage of electricity (44%), much more than the second place source, which is coal at 21%, and far more than solar, which generates only 3% (Figure 1).

National Energy Sources Pie Chart

Figure 1. Electricity generation by source in the United States, 2019. Data from EIA.

This difference speaks to the decentralized nature of the solar industry, with more facilities producing less energy. At a glance, this may seem less efficient and more costly than the natural gas alternative, which has fewer plants producing more energy. But in reality, each of these natural gas plants depend on thousands of fracked wells – and they’re anything but efficient.Fracking's astronomical decline rates - after one year, a well may be producing less than one-fifth of the oil and gas it produced its first year. To keep up with production, operators must pump exponentially more water, chemicals, and sand, or just drill a new well.

The cost per megawatt hour of electricity for a renewable energy power plants is now cheaper than that of fracked gas power plants. A report by the Rocky Mountain Institute, found “even as clean energy costs continue to fall, utilities and other investors have announced plans for over $70 billion in new gas-fired power plant construction through 2025. RMI research finds that 90% of this proposed capacity is more costly than equivalent [clean energy portfolios, which consist of wind, solar, and energy storage technologies] and, if those plants are built anyway, they would be uneconomic to continue operating in 2035.”

The economics side with renewables – but with solar, wind, geothermal comprising only 12% of the energy pie, and hydropower at 7%, do renewables have the capacity to meet the nation’s energy needs? Yes! Even the Energy Information Administration, a notorious skeptic of renewable energy’s potential, forecasted renewables would beat out natural gas in terms of electricity generation by 2050 in their 2020 Annual Energy Outlook.

This prediction doesn’t take into account any future legislation limiting fossil fuel infrastructure. A ban on fracking or policies under a Green New Deal could push renewables into the lead much sooner than 2050.

In a void of national leadership on the transition to cleaner energy, a few states have bolstered their renewable portfolio.

How does your state generate electricity?
Legend

Figure 2. Electricity generation state-wide by source, 2019. Data from EIA.

One final factor to consider – the pie pieces on these state charts aren’t weighted equally, with some states’ capacity to generate electricity far greater than others.  The top five electricity producers are Texas, California, Florida, Pennsylvania, and Illinois.

Transportation

In 2018, approximately 28% of total U.S. energy consumption was for transportation. To understand the scale of infrastructure that serves this sector, it’s helpful to click on the petroleum refineries, crude oil rail terminals, and crude oil pipelines on the map.

Map of transportation infrastructure

Transportation Fuel Infrastructure. Data from EIA.

The majority of gasoline we use in our cars in the US is produced domestically. Crude oil from wells goes to refineries to be processed into products like diesel fuel and gasoline. Gasoline is taken by pipelines, tanker, rail, or barge to storage terminals (add the “petroleum product terminal” and “petroleum product pipelines” legend items), and then by truck to be further processed and delivered to gas stations.

The International Energy Agency predicts that demand for crude oil will reach a peak in 2030 due to a rise in electric vehicles, including busses.  Over 75% of the gasoline and diesel displacement by electric vehicles globally has come from electric buses.

China leads the world in this movement. In 2018, just over half of the world’s electric vehicles sales occurred in China. Analysts predict that the country’s oil demand will peak in the next five years thanks to battery-powered vehicles and high-speed rail.

In the United States, the percentage of electric vehicles on the road is small but growing quickly. Tax credits and incentives will be important for encouraging this transition. Almost half of the country’s electric vehicle sales are in California, where incentives are added to the federal tax credit. California also has a  “Zero Emission Vehicle” program, requiring electric vehicles to comprise a certain percentage of sales.

We can’t ignore where electric vehicles are sourcing their power – and for that we must go back up to the electricity generation section. If you’re charging your car in a state powered mainly by fossil fuels (as many are), then the electricity is still tied to fossil fuels.

Petrochemicals

Many of the oil and gas infrastructure on the map doesn’t go towards energy at all, but rather aids in manufacturing petrochemicals – the basis of products like plastic, fertilizer, solvents, detergents, and resins.

This industry is largely concentrated in Texas and Louisiana but rapidly expanding in Pennsylvania, Ohio, and West Virginia.

On this map, key petrochemical facilities include natural gas plants, chemical plants, ethane crackers, and natural gas liquid pipelines.

Map of Petrochemical Infrastructure

Petrochemical infrastructure. Data from EIA.

Natural gas processing plants separate components of the natural gas stream to extract natural gas liquids like ethane and propane – which are transported through the natural gas liquid pipelines. These natural gas liquids are key building blocks of the petrochemical industry.

Ethane crackers process natural gas liquids into polyethylene – the most common type of plastic.

The chemical plants on this map include petrochemical production plants and ammonia manufacturing. Ammonia, which is used in fertilizer production, is one of the top synthetic chemicals produced in the world, and most of it comes from steam reforming natural gas.

As we discuss ways to decarbonize the country, petrochemicals must be a major focus of our efforts. That’s because petrochemicals are expected to account for over a third of global oil demand growth by 2030 and nearly half of demand growth by 2050 – thanks largely to an increase in plastic production. The International Energy Agency calls petrochemicals a “blind spot” in the global energy debate.

Petrochemical infrastructure

Petrochemical development off the coast of Texas, November 2019. Photo by Ted Auch, aerial support provided by LightHawk.

Investing in plastic manufacturing is the fossil fuel industry’s strategy to remain relevant in a renewable energy world. As such, we can’t break up with fossil fuels without also giving up our reliance on plastic. Legislation like the Break Free From Plastic Pollution Act get to the heart of this issue, by pausing construction of new ethane crackers, ensuring the power of local governments to enact plastic bans, and phasing out certain single-use products.

“The greatest industrial challenge the world has ever faced”

Mapped out, this web of fossil fuel infrastructure seems like a permanent grid locking us into a carbon-intensive future. But even more overwhelming than the ubiquity of fossil fuels in the US is how quickly this infrastructure has all been built. Everything on this map was constructed since Industrial Revolution, and the vast majority in the last century (Figure 3) – an inch on the mile-long timeline of human civilization.

Figure 3. Global Fossil Fuel Consumption. Data from Vaclav Smil (2017)

In fact, over half of the carbon from burning fossil fuels has been released in the last 30 years. As David Wallace Wells writes in The Uninhabitable Earth, “we have done as much damage to the fate of the planet and its ability to sustain human life and civilization since Al Gore published his first book on climate than in all the centuries—all the millennia—that came before.”

What will this map look like in the next 30 years?

A recent report on the global economics of the oil industry states, “To phase out petroleum products (and fossil fuels in general), the entire global industrial ecosystem will need to be reengineered, retooled and fundamentally rebuilt…This will be perhaps the greatest industrial challenge the world has ever faced historically.”

Is it possible to build a decentralized energy grid, generated by a diverse array of renewable, local, natural resources and backed up by battery power? Could all communities have the opportunity to control their energy through member-owned cooperatives instead of profit-thirsty corporations? Could microgrids improve the resiliency of our system in the face of increasingly intense natural disasters and ensure power in remote regions? Could hydrogen provide power for energy-intensive industries like steel and iron production? Could high speed rail, electric vehicles, a robust public transportation network and bike-able cities negate the need for gasoline and diesel? Could traditional methods of farming reduce our dependency on oil and gas-based fertilizers? Could  zero waste cities stop our reliance on single-use plastic?

Of course! Technology evolves at lightning speed. Thirty years ago we didn’t know what fracking was and we didn’t have smart phones. The greater challenge lies in breaking the fossil fuel industry’s hold on our political system and convincing our leaders that human health and the environment shouldn’t be externalized costs of economic growth.

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