Saturday, January 23, 2010

A comprehensive look at natural-gas 'fracking'

We've been paying close attention to reports about hydraulic and chemical fracturing for natural gas for about two and a half months; now The Wall Street Journal offers a situation piece saying that increasing environmental concerns about the drilling method "is threatening to slow development of the huge gas fields that some hope will reduce U.S. dependence on foreign oil and polluting coal."

Ben Casselman and Russell Gold write that fracking "has turned gas deposits in shale formations into an energy bonanza" but has also "triggered increasing debate over whether the drilling process could pollute freshwater supplies. Federal and state authorities are considering action that could regulate hydraulic fracturing, potentially making drilling less profitable and giving companies less reason to tap into this ample supply of natural gas."

That's an investor-oriented angle on old news for us, but the story has a good diagram, reproduced here, and the writers reveal that Exxon Mobil Corp. negotiated the right to back out of its acquisition of gas producer XTO Energy Inc., "a fracturing pioneer, in a deal now valued at $29 billion ... if Congress passes a law to make hydraulic fracturing illegal or 'commercially impracticable'," whatever that means. Maybe what courts say.

The story also offers some useful fundamentals: "The chemicals make up less than 1 percent of the overall solution, but some are hazardous in low concentrations. Today, the industry estimates that 90 percent of all new gas wells are fractured. . . . As the industry has honed its techniques, hydraulic-fracturing operations have become more complex, requiring far more water and chemicals — millions of gallons per well, rather than tens or hundreds of thousands of gallons in the past." And just as that trend was developing, in 2005, Congress exempted fracking from the Safe Drinking Water Act of 1974. Now bills are pending to repeal that exemption, and "several states, including Colorado, Pennsylvania and New York, have either passed or are considering tightening regulations on fracturing and related activities," the Journal notes.

"Most people agree that means that if a fracturing job is done correctly, it would be virtually impossible for water or chemicals to seep upward into drinking water supplies," Casselman and Gold write. "Environmental groups point out that wells aren't always constructed properly. Moreover, they say, storage ponds that hold chemical-laced water after fracturing is complete can overflow, and trucks carrying chemicals can crash." And the reporters note the death of some Louisiana cattle from a spill of drilling fluids. The 1,837-word story is the most comprehensive we have seen on the subject in mainstream media. It's worth reading.

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