Amid fracking-fueled boom in natural gas, insider documents reveal many doubts about prospects

The boom in natural-gas production from hydraulic fracturing of deep, dense shales (click on impge for larger version) has generated many items on The Rural Blog, mainly because of its economic and environmental implications -- but also because of the widespread belief that the boom will be big enough to alter the nation's energy menu.

"But the gas may not be as easy and cheap to extract . . . as the companies are saying, according to hundreds of industry e-mails and internal documents and an analysis of data from thousands of wells," Ian Urbina reports for The New York Times. Urbina's package includes many of those documents, which reflect an old truth about oil and gas: It takes money to produce, and some in the industry make more money above the ground than below it, by flipping leases and selling fractional interests, often on the basis of strong initial production.

Urbina describes how that hunger for investment money extends even to publicly traded companies that may illegally overstate their prospects, and he reports, "The amount of gas produced by many of the successful wells is falling much faster than initially predicted by energy companies, making it more difficult for them to turn a profit over the long run." And that could have environmental implications, with more drilling and fracking to meet production expectations. All in all, a very strong package. (Read more)

UPDATE, June 29: Chesapeake Energy CEO Aubrey McClendon says the Times' article is "inaccurate and misleading," Tulsa World in Tulsa, Okla., and the Star-Telegram in Fort Worth, Texas report.