"What happened? As a Bloomberg report put it, 'The numbers never added up.' Fracking has always been expensive; extraordinarily generous fossil-fuel subsidies helped hide the true cost. With new wells facing average production declines of 60 percent in the first year, petroleum companies had to frantically drill more of them. The entire model was premised on high oil and gas prices. But nationwide, the glut of gas (and, to a lesser extent, oil) precipitated by the fracking boom depressed prices to their lowest levels since the 1990s," Jerolmack reports. "The result? Frackers pumped the brakes. A wave of consolidations and bankruptcies swept across the sector. The stock prices of premier energy firms like Chesapeake Energy Corp. crashed (it declared bankruptcy in 2020). Some, like Anadarko Petroleum Corp., liquidated their shale gas holdings. Chevron announced in December 2019 that it would write down up to $11 billion in shale-gas assets."
More than 100,000 oil and gas jobs were lost in 2020, and about 70% of them may not come back this year or ever, according to a Deloitte report. And even those jobs may not have helped local economies the way fracking supporters promised. A recent Ohio River Valley Institute report "details how fracking boosters’ promise of jobs and prosperity for the broader Appalachia region was a mirage," Jerolmack reports. "In the 22 Ohio, Pennsylvania, and West Virginia counties that produce most of America’s natural gas, economic output grew by 60% from 2008 to 2019, but little of the income generated by that growth stayed in local communities. The region saw only 1.6% job growth, compared with 9.9% nationally; its share of the nation’s population fell by 11%."
Fracking is still a major factor in the Permian Basin of Texas and New Mexico, but wastewater disposal problems may hinder its growth.
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