Energy in Depth

Shale Goes Global

State Dept. forum seeks to export promise and potential of shale gas to markets around the world – but will Administration apply same lessons, encouragement here at home?

Col. Edwin Drake is widely credited with developing the world’s first commercial oil well in Titusville, Pennsylvania in 1859. But here’s something you might not have known about the guy: He wasn’t actually a colonel.

Here’s something else: According to Chinese and Polish historians, Drake didn’t actually drill the first oil well either. In Poland, that honor rests with Ignacy ?ukasiewicz, who described his discovery in 1854 as the advent of a “new branch of industry which shall bear plentiful fruit.” Of course, from China’s perspective, both Drake and ?ukasiewicz arrived on the scene about 1,500 years too late. In their record books, 4^th century monks are credited with developing the first-ever oil well, employing cutting-edge technology in the form of bamboo shoots to produce the oil needed to heat water from which deposits of salt could be distilled. Turns out even back then Chinese food had plenty of salt.

But while friendly disagreements may persist when it comes to assigning credit and location for the discovery of oil, when it comes to the discovery of clean-burning natural gas from shale, no ambiguity exists: We found it. And much more important: We invested the time, talent and resources in developing the technologies needed to make its production possible. The upshot? A veritable shale gas “revolution” taking place right here, right now, all across America — with hundreds of thousands of jobs and billions in state, local and federal revenue currently being generated in its wake.

Not yet, anyway. But an event organized by the U.S. Department of State earlier this week sought to begin the process of changing all that. Presided over by David Goldwyn, State’s coordinator for International Energy Affairs, the two-day Global Shale Gas Initiative Conference held in Washington on Monday and Tuesday brought together representatives from 20 countries (including the United States) to share news, views and technical insights related to the business of producing natural gas from shale. What interest does the State Department have in promoting a phenomenon like that? Mr. Goldwyn took on this question directly in his opening remarks:

[O]ur motivation as the State Department to engage on this issue should be clear for foreign policy and energy security reasons. Countries around the world need diversity of energy supply. There are countries with millions of people – in fact, tens and some hundreds of millions of people – without access to electricity services. They need a feedstock and they need it for base load energy. …So it’s understandable that they want to develop shale gas, but we have, in our country, an umbrella of laws and regulations that makes sure this is done safely and efficiently.

But just as no two shale plays are exactly the same, no one nation holds the exclusive rights to producing abundant resources from shale that underlies its land. Just about everybody’s got the stuff, geologists tell us. But not everyone has access to the best and most innovative technologies needed to convert the opportunity of shale into the reality of a stronger economy, a cleaner environment, and a higher standard of living for all who call that country home.

Of course, this conference didn’t exactly come out of left field; according to the White House, the president and his administration continue to be actively involved in spreading the good news of shale gas far and near, even using it as a tool of diplomatic engagement in promoting a clean, sustainable and growth-oriented energy future for some of our closest and most important trading allies across the globe. Back in November, the White House described its efforts to export the promise and potential of shale to our friends in China in the following way:

[The] Shale Gas Initiative will allow the U.S. and China to use experience gained in the United States to assess China’s shale gas potential, promote environmentally-sustainable development of shale gas resources, conduct joint technical studies to accelerate development of shale gas resources in China, and promote shale gas investment in China through the U.S.-China Oil and Gas Industry Forum, study tours, and workshops.

According to Reuters, the Chinese have been more than happy to accept our insight and technical advice in this space, with the country just last week launching a national shale gas research center and announcing a series of goals that include: 1) finding one trillion cubic meters of shale gas, 2) building 15-30 billion cubic meters of production capacity, and 3) ultimately using shale to meet as much as 12 percent of China’s total natural gas demand by 2020. Don’t think they can get there? Smart money says not to bet against them. According to reports, China’s total shale gas potential may soon be measured in quadrillions of cubic feet, not trillions. All they need is the technology and infrastructure to bring these resources to market.

Same goes for our friends in Poland, who view the prospect of shale gas development as a national security imperative more than anything else. You see, as it currently stands, a large portion of the natural gas upon which the Polish economy depends is piped in each day from Russia – and it doesn’t take a Ph.D. candidate in European history to understand the tensions and uncertainties inherent in that arrangement.

Earlier this month, the first-ever application of hydraulic fracturing technology was introduced at the Markowola-1 exploratory well in Kozienice, Poland. How much natural gas will they find? No one can say for certain. But according to one report from Wood Mackenzie, the Polish people may have more than 47 trillion cubic feet of recoverable natural gas trapped in shale deposits beneath their feet – or nearly half the entire proven natural gas reserves in Europe. Who’s laughing now, right Poland?

The story, of course, goes on and on from there: South Africa’s got lots of shale potential; so too does Sweden, Mexico, Canada, Australia, Morocco, Pakistan, India and Armenia – just to name a few. But while the depths and temperatures and technical requirements will vary from play to play to play – one thing will always remain constant: the continued need to use cutting-edge fracturing technology to tap into resources that would be too deep, too diffuse and too difficult to get at otherwise.

As was made clear in Washington this week, the U.S. government understands this reality – at least in an international context. Left to be determined is whether it will apply these same lessons to shale gas exploration here in the United States. Let’s promote shale gas globally, but let’s act locally on it as well. That was the message delivered by the State Department in Washington this week. Any chance the good folks over at EPA heard it?

ICYMI — Top nat’l energy expert on Forbes.com: Hydraulic fracturing critical to “developing jobs, clean sources of energy”

EPA’s Fracking Hysteria

Forbes.com

Dr. Michael Economides
Aug. 20 2010

• “Though activist campaigns are garnering increasing public interest in the fracking process, two points remain unchanged: its decades-long safety record and its role in America’s prosperity”

• “Environmental and health studies have been conducted for years showing no linkage between fracking and drinking water contamination”

After postponing a hydraulic fracturing (aka “fracking”) hearing slated for upstate New York last week, EPA is planning a new event which reports suggest could turn into a full two-day spectacle sometime in September. Though activist campaigns are garnering increasing public interest in the fracking process, two points remain unchanged: its decades-long safety record and its role in America’s prosperity/ So why all the hype and fervor over a reliable technique that has been around since 1947?

For those that don’t know, fracking is a technique which uses water pressure to create fractures in rock that allows extraction of oil and natural gas. Those who work in the energy industry are rightfully worried that efforts to curb this critical process will also eliminate their jobs. As high unemployment persists — over 7.7 million US jobs lost since the recession began in December 2007 — and the economy struggles to rebound, development of America’s natural gas resources is bringing new investments to communities across the country. In addition to the economic benefits, it is also essential in providing America clean natural gas which fuels public transportation and helps reduce greenhouse gas emissions. Developing jobs and clean sources of energy are just some of the reasons people are so passionately supportive of hydraulic fracturing.

Yet, some activist groups are singling out the technique in a scramble to blame corporations for poisoning our drinking water. While the fracking process uses chemicals, these claims are unfounded to say the least. The ingredients used in hydraulic fracturing include a small dose of chemicals (0.5%) mixed with water and sand (99.5%). Environmental and health studies have been conducted for years showing no linkage between fracking and drinking water contamination. In a 2004 comprehensive report conducted by EPA itself, federal researchers concluded:

In its review of incidents of drinking water well contamination believed to be associated with hydraulic fracturing, EPA found no confirmed cases that are linked to fracturing fluid injection into CBM wells or subsequent underground movement of fracturing fluids. Further, although thousands of CBM wells are fractured annually, EPA did not find confirmed evidence that drinking water wells have been contaminated by hydraulic fracturing fluid injection into CBM wells.

If the EPA study were not enough to vindicate the fracking process, common sense should. Natural gas formations are thousands of feet below drinking water aquifers so for contamination to occur the fracking solution would have to move through multiple layers of rocks. This would only happen however if the rocks were extremely porous, yet if this were the case the natural gas reservoir would have never existed in the first place. The natural gas would have leaked naturally to the surface over the course of millions of years.

As our officials in Washington monitor the upcoming EPA public hearing let’s hope the scare tactics and rhetoric don’t drowned out the facts and the preponderance of evidence supporting the fracking process. Regrettably as people across America are looking for jobs and struggling to put food on the table, the manufactured controversy surrounding fracking will likely continue. With any luck the unsubstantiated claims by the environmental lobby will not keep us from utilizing our clean natural gas resources or develop a vibrant energy economy here at home.

Economides is among America’s leading energy analysts. A consultant, educator, and PhD petroleum engineer, Economides has done technical and managerial work in more than 70 countries and is a professor at the University of Houston.

NOTE: Click HERE to view this column online.

READ MORE

• Just The Facts: University of Pitt. Prof. Sets the Record Straight on Hydraulic Fracturing
• Just The Facts: Energy Experts, Top Forbes Energy Reporter Debunk “Preposterous” HF Claims
• Fact-Check: Debunking GasLand (Fact Sheet)
• What They’re Saying: Tightly Regulated Hydraulic Fracturing Critical to U.S. Energy Security
• What They’re Saying: Hydraulic Fracturing Turning “Rags into Riches”
• Issue Alert: When Gummy Bears Attack

Graphic: What’s In Frac Fluids?

Let’s Talk About Cleavage

Or why the foliation perpendicular to stress in the context of subsurface ductile deformation matters in the debate over shale and hydraulic fracturing 

We’ve spent some time over the past couple months taking a critical look at some of the key assertions made in the HBO documentary GasLand, putting forth in that time two separate rebuttal documents that we believe address in a substantive way a number of the misconceptions upon which the film, and its broader political message, is based.

But one of the issues we haven’t tackled yet is the suggestion that fissures made in the process of fracturing a shale formation are so long, and so upwardly vertical, that they have the potential to create conduits (or cleavages) through which fracturing-related fluids can travel to water-bearing formations thousands of feet above – including the water table. In his brief explanation of what the fracturing process is all about, GasLand director Josh Fox includes the following image in his film:

According to Fox, the fracturing process “is like a mini-earthquake,” and “blasts a mix of water and chemicals 8,000 feet into the ground.” At least he gets the depth right. But according to New York Department of Environmental Conservation (page 127 of this document), “No blast or explosion is created by the hydraulic fracturing process. The proppant holds the fractures open, allowing hydrocarbons to flow into the wellbore after injected fluids are recovered.” Guess there’s no need to call in the bomb squad after all.

But basic mechanics aside, the message the director is attempting to advance through the image above is simple: Hydraulic fracturing completely decimates the shale formation, creates massive gaps in the underlying rock, and produces vertical chasms that travel all the way up to the surface. Within that context, it becomes a lot easier to understand how the technology could lead to the drinking water contamination – as long as pathways and pressure exist, who can say for sure what’s actually happening down there, or up here?

Serious geologists have known since time immemorial that such a phenomenon is a virtual impossibility – and so has the EPA, which wrote in 1995 that “given the horizontal and vertical distance between the drinking water well and the closest methane production wells, the possibility of contamination of endangerment of USDWs [underground sources of drinking water] in the area is extremely remote.” And that letter, keep in mind, was in reference to a coalbed methane well – which reside thousands of feet closer to the water table than shale wells.

But thanks to the good folks over at Pinnacle Technologies, we now have some solid data to express this separation in quantitative terms. As reported by Pinnacle general manager Kevin Fisher in July’s edition of the American Oil & Gas Reporter, the following graphs plots actual field data from tens of thousands of fracturing operations conducted over the past decade – this first one, in the Barnett Shale, which shows quite clearly that even the most shallow fissures created through the hydraulic fracturing process remain separated from the water table by more than 3,500 feet:

But that’s just the Barnett, right? Everyone knows there’s no problem out there. Isn’t the real area of concern the Mighty Marcellus – where activists continue to claim that gas, chemicals, salt, metals, and Lord knows what else regularly get dredged up from the depths and beamed into every well, sink and stream in sight? Well, Pinnacle ran the numbers on the Marcellus as well, and although the data set isn’t quite as robust as what you’d find in the Barnett (remember: we’ve been developing that one a bit longer), the story in Pennsylvania, West Virginia and Ohio is remarkably similar. To wit:

Here we see an even greater separation between fractures in the underlying rock and sources of potable water above – with the closest the two shall ever meet clocking in at roughly 4,300 feet.

In other words, the deepest formations holding drinking water and the most shallow depth in which you’ll find a fracture in the Marcellus Shale are still separated by the equivalent of three-and-a-half Empire State Buildings – or three Petronas Towers, for our Malaysian friends. And by the way: they’re not exactly separated by air either. Between the two, you’ll find millions of tons of solid, impermeable rock – rock that has for literally hundreds of millions of years acted as an immutable barrier preventing salty water below from communicating with fresh water above.  

But just to be sure we got this right, we sent these graphs and data up to Williamsville, N.Y. so that Ph.D. geologist Michael P. Joy might give them a gander and share some technical insights into what makes this phenomenon possible. Below is a (small) excerpt from the email he sent us in reply:

The hydraulic fracturing process creates fractures that are very small, usually an 1/8th inch or less in width. There is not enough pressure that could be exerted on the column of water to create a fracture matrix long enough to reach anywhere close to near surface aquifers. … The gas and water in these deep shale formations exist in hydrostatic equilibrium; the pressure acting down on the formation fluid is equal to the pressure being exerted from the bottom upward and the formation fluids act under the immutable laws of physics and stay in place.

Right. Exactly what he said.

No Place Like Dome?

Budget, air conditioning (?) play role in EPA decision to move Binghamton HF forum to Syracuse – but tight logistics force agency to postpone event ‘til next month

Two county lines and a 73-mile stretch of Interstate 81 are all that separate Binghamton from Syracuse, N.Y. But judging by the reaction lodged by anti-Marcellus activists upon hearing news of EPA’s change of venue for its upcoming forum on hydraulic fracturing, you would’ve thought the agency was trying to move the thing instead to the Syracuse, Sicily.

Now comes word that the forum itself will need to be rescheduled for sometime in September – a public safety decision announced today after the hosts consulted with local police and county officials. Of course, if you thought anti-energy activists were angry about the change of venue for the event before, imagine what they’ll be saying today about its outright postponement. Actually, here’s an early preview:

“EPA has been bought and paid for!” – declared one commenter on the website of the Binghamton Press & Sun-Bulletin this morning. “[F]or months this was the location, as far as i’m [sic.] concerned the gas companies pulled this stunt with a pay-off to someone!” Actually, the real story here appears to be about a pay-off that didn’t quite happen – specifically, a payment from EPA to Binghamton University to rent the space needed to host the forum in the first place.

According to local media, EPA and BU originally agreed to (but never signed a contract stipulating) a $6,000 hosting fee – based on an assumption that several hundred folks, at most a thousand or two, would be coming. Then came news that 8,000 people were planning to attend – along with a full-slate of musical acts, jugglers, a couple face-painters, and a petting zoo.

Again, according to reports, all BU did was ask EPA for some extra funds to handle the logistics associated with providing a safe and civil atmosphere in which the forum could take place. EPA, for its part, balked. Spend $1.9 million on the first phase of the second study we’ve done on hydraulic fracturing in the past 70 months? No problem, says EPA. Fork over a couple grand extra to ensure we’ve got enough Job-Johnnies available on-site in Binghamton? That’s a bridge too far.

Of course, money aside, the other issue that had anti-Marcellus activists in an absolute panic was a report surfacing last week (most prominently in the Press & Sun-Bulletin) indicating the forum might be held in a venue without a sufficient air-conditioning system in place. Here’s an excerpt from the call-to-action that Katherine Nadeau of the pressure group Environmental Advocates of New York sent around to her followers on Aug. 6:

[T]he university is trying to move the hearing to an un-air conditioned, acoustically-impossible gym. … You should call [BU] President McGraw at 607-777-xxxx.  … [Tell him that] due to the size of the crowd, the age diversity (children and seniors) and the likelihood that it will be a very hot day, holding the hearing in an air-conditioned venue is critical.

Funny thing about air-conditioning in New York – it’s powered by electricity, nearly a third of which in the state is derived directly from clean-burning natural gas. And according to the friendly dispatcher with whom we spoke at NYSEG (the major Southern Tier utility), a larger share of Binghamton’s electricity comes from natural gas than the average community in the state. So again: Activists oppose natural gas and the means for producing it. But they support the electricity derived from natural gas that makes air-conditioning possible. So in other words: They oppose being denied the latter, especially if it impacts their level of comfort in protesting the former. Got it?

Of course, lost in the recriminations over the decision to move the EPA forum from Binghamton to Syracuse – and then today’s news, to move the event itself to the month of September – is the broader realization that this “public information session,” as the agency calls it, won’t play a role in determining the scope and scale of EPA’s future study on the safety and performance of hydraulic fracturing – the second such study (as we mentioned) that EPA is doing on this general subject in the past six years.

Those decisions were made late last year by Congress, and confirmed earlier this year by the agency’s Science Advisory Board – instructing EPA to study the relationship between the use of fracturing technology and the safety and quality of underground sources of drinking water. The good news is that the science on this phenomenon is about as straightforward as it gets – which is why even EPA has been forced to admit (repeatedly) that not a single case of groundwater contamination has ever been tied to hydraulic fracturing in the 60 years it’s been in use.

Unfortunately, if the previous three “public information sessions” over which presided EPA this summer are any indication, the event in Syracuse next month won’t focus all that much on the factual history associated with hydraulic fracturing’s safe and efficient use in New York State over the past half-century. Nor will the panels or participants spend much time considering the enormous job-creating and broader economic potential that responsible Marcellus exploration can leverage for a state with 900,000 residents on the unemployment rolls and a $9 billion gap in the budget.

No, it probably won’t have much of that. But according to one invite we received in the (electronic) mail, there will be plenty of bands on hand — The Sim Redmond Band, the Tioga County Heymakers, and a group called “Sophistafunk,” just to name a few. And who knows? Maybe these guys feel the same way about the promise and potential of clean-burning natural gas for New York as we do (their guitars aren’t powered by wind, after all).

Guess we’ll eventually have the opportunity to find out. Just have to wait ‘til September to do it.

House Call on the FRAC Act

Sen. Casey asks Colo. congresswoman to help him make the case for jobs-killing anti-HF bill in Philadelphia paper – EID takes a closer look

U.S. Rep. Diana DeGette (D-Colo.) represents the only congressional district in Colorado where hydraulic fracturing technology is not currently used; Philadelphia represents the only major city in Pennsylvania where the geology suggests it’s likely the technology will never be used.

So of course it made perfect sense for Rep. DeGette to choose the Philadelphia Inquirer to lodge her latest broadside against the 60-year-old energy technology known as hydraulic fracturing, teaming up with FRAC Act battery mate and Pennsylvania senator Bob Casey (D) on a column that does its level best to tie onshore natural gas exploration to the oil spill in the Gulf – notwithstanding the fact that hydraulic fracturing had nothing to do with the incident offshore.

But for those who continue to oppose the generations-old, 1.1-million-served-and-counting procedure of “fracking” a well, admitting to that fact would be tantamount to letting a once-in-a-lifetime crisis go to waste. After all: Opportunities to re-write a 37-year-old statute for the explicit purpose of assigning EPA unprecedented new authority over something that’s always been regulated by the states don’t come along every day. Rep. DeGette, a perennial FRAC Act introducer, knows it – and Sen. Casey likely does too. So maybe that’s why their column on hydraulic fracturing in Tuesday’s paper includes three separate allusions to the spill in the Gulf – three references in a column that only runs 580 words.

We’ll get to the errors in that piece in just a second. But let’s start by giving credit where credit’s due: Nowhere in the op-ed do Sen. Casey and Rep. DeGette attempt to advance the notion that fracturing was previously regulated under the federal Safe Drinking Water Act, but now – magically – is not. The reason, presumably, is that it’s not true. Unfortunately, that hasn’t stopped folks like Rep. Maurice Hinchey (D-N.Y.) from peddling their own alternate reality in support of the FRAC Act.

In Hinchey’s world, EPA had been regulating hydraulic fracturing for 30 years right up until Dick Cheney rammed through legislation in 2005 that “exempted” the procedure from federal oversight.  But wait, that bill had the support of nearly three-quarters of the U.S. Senate? Wait, hydraulic fracturing had never in its history been regulated under SDWA prior to 2005, or after it? Wait! Did Rep. Hinchey just tell a committee of Congress that a nurse in Colorado “died after being exposed to fracturing fluids” – even though that’s not true? Of course he did. Silly to sweat the details when no one holds you accountable for them.

Again, to their credit, the inaccuracies found in Tuesday’s DeGette/Casey column can be considered minor compared to the whoppers that Hinchey and his friends let fly just about every week. But they still should be considered. Below we identify and correct just a few:

Six Reasons to Oppose Stowaway HF Provisions Tucked Into Reid Energy Bill

Undermines the states, stifles energy development in America, asks for things we might not even own … Energy In Depth counts down the ways

Last night, Senate Majority Leader Harry Reid released the text of energy legislation that reports indicate could be brought up for debate on the floor as early as this week.  Unfortunately, although described as a “scaled-back” and “non-controversial” iteration of previous legislative attempts, the bill includes sections explicitly targeting the safe and steady use of hydraulic fracturing — reminiscent of language found in the so-called FRAC Act, which has yet to generate a single committee hearings or markup since first being introduced in the previous Congress.

Here’s how Energy In Depth executive director Lee Fuller characterized those provisions today:

“The entire universe of additives used in the fracturing process is known to regulators and the public, as is mandated as such under federal rules enforced by OSHA. The problem with this provision is that it has the potential to create a series of legal responsibilities that operators, and even service companies, might not be able to fulfill, especially under a scenario where folks are asked to post information that doesn’t even belong to them. The amazing thing is this provision appears to be moving ahead even as EPA and Congress continue to study the issue. It raises the question of why they’re doing the study in the first place if policymakers don’t appear to be all that interested in learning anything from it.”

Below, EID counts down the reasons that Reid’s HF provisions should be opposed by anyone who supports the economic, strategic and environmental imperative of producing shale gas resources in America:

1)     Section 4301 would undermine existing state regulatory authority, be inconsistent with federal environmental laws that balance disclosure issues against confidential business information, chill technology innovation and investment related to hydraulic fracturing, and restrict the development of the nation’s enormous reserves of shale gas.

2)     Section 4301 places unrealistic burdens on producers. Operators and service companies currently provide full chemical disclosure in accordance with all applicable federal and state authorities. In contrast to the assertions on which this section premised, these materials are well known to state regulators, and are generally available to members of the public upon a quick search of the Internet, or by request to the state. 

Unfortunately, this section would compel producers to disclose detailed information that they may neither have nor have the legal right to disclose.  Additives used in the fracturing process are manufactured by companies that determine the amount of information they can post on Material Safety Data Sheets.  Service companies and producers purchase these materials from manufacturers. That use does not either provide information such as CAS registry numbers or create a legal right to disclose such information publicly.  Consequently, producers could be in a position where they cannot meet these new requirements and would either be subject to $10,000/day fines under EPCRA, or limit their ability to fracture natural gas formations.

3)     Section 4301 is inconsistent with federal statutes. The language is inconsistent with the key Congressional policies set up in EPCRA and other federal environmental laws for attempting to balance disclosure issues against confidential business information.  For example, in EPCRA Congress recognized the need to strike a balance between reporting on additive use to local authorities and the need to protect confidential business information. However, the language does not extend these protections for valuable information related to hydraulic fracturing.

4)     Section 4301 will adversely impact energy development in the U.S. with no tangible benefits to show for it. It would provide a strong disincentive to service companies to engage in further innovation with respect to the development of new fracturing solutions. The loss of these new and innovative products would greatly reduce energy production in the U.S., and ratchet up our reliance on imports. Even though state regulatory programs have effectively managed the environmental considerations associated with fracturing, companies are actively working to produce new HF systems that are even more environmentally benign than they are today. The Reid language would undermine this technology development and innovation.

5)     Isn’t EPA in the middle of doing a study on this exact thing right now?  In the FY2010 Appropriations bill, Congress directed EPA to undertake a study focusing on the relationship between hydraulic fracturing and drinking water. In 2004, the agency published a report finding hydraulic fracturing to be a safe and well-regulated technology. Notwithstanding those findings, EPA is honoring the Congressional request to study the technology once again. Legislative efforts such as this one should wait until the results of that study are released. Otherwise, why should the time, energy and resources be spent on doing the study in the first place?

6)     States’ record of enforcement/oversight proves they know how to regulate the process better than the feds. States have effectively regulated hydraulic fracturing for over 40 years with no confirmed incidents of groundwater contamination associated with HF activities. Section 4301 would undermine existing state regulatory authority, be inconsistent with federal environmental laws that balance disclosure issues against confidential business information, chill HF technology innovation and investment, and restrict the development of the nation’s shale gas resources.

You Sent Out the Wrong List?

AP story on “potentially harmful” chemicals used in fracturing process runs everywhere in Pennsylvania – two days later, we learn DEP sent AP the wrong list (!)

Here’s how the argument against the decades-old process of fracturing a natural gas well tends to be structured: In one breath, an anti-gas activist will tell you the materials used in fracturing procedure are “secret.” And then in the next breath, he’ll recite a specific list of materials used in the process and declare them to be a danger to public health and welfare. Never mind the contradiction. Never mind that fracturing solutions are composed almost entirely (99.5%) of water and sand. Never mind that the formations being fractured are thousands (and thousands) of feet below the water table.

But this week, activists were dealt a serious blow when the Pennsylvania Dept. of Environmental Protection (DEP) released a comprehensive listing of the additives used in the fracturing process – effectively rendering moot all future claims of secrecy. But the news wasn’t all bad for these folks: Having secured a copy of the list from DEP, the Associated Press reported on Monday that among the items found on the sheet were naphthalene, toluene and xylene – all chemicals associated with a barrel of oil. So why exactly were shale producers using oil to produce natural gas?

Turns out they weren’t. According to an item in today’s Scranton Times-Tribune, the list supplied to the Associated Press by DEP contained a pretty significant boo-boo: Instead of listing all the materials used to access the shale gas, DEP’s list of chemicals included “not just the chemicals pumped deep underground, but also those stored or used on a well site, including fuel for vehicles and brake fluid,” according to the Times-Tribune.

Translation: The diesel fuel in the gas tank of the truck that carried the worker to the wellsite was included on the list. Looking for a good analogy? It’d be like compiling a list of materials used in baking a cake, and then including chemicals like toluene and xylene on that list simply because the dessert was delivered by a truck.

Here’s how the mistake went down:

The original list was a compilation of the chemicals identified on safety documents … but [DEP] did not realize that it included substances the contractors use both above and below ground on a well site. The second list was winnowed by a DEP chemist … Of the 83 chemicals on the list published by the AP and the 78 on the list posted by the DEP, only 37 items are in common. …

“You can blame it on me,” Scott Perry, the director of DEP’s Bureau of Oil and Gas Management, said on Wednesday.

Essentially what we have here is an honest mistake – made by a regulator who hasn’t been shy when it comes to defending the record of his Department against the likes of U.S. Sen. Robert Casey (D-Pa.). Back in April, Casey told Mike Soraghan of E&E News (link here, subs. req’d) that he planned to “look at whether state regulation is enough” in managing the fracturing process, stating further that if language was included in a Senate bill reaffirming the good work states have been doing over the past 60 years in safely regulating fracturing, “they will make me mad.”

Those words, incidentally, drew a strong rebuke from Democratic governor Ed Rendell’s DEP office, with Department spokesman Neil Weaver telling that same reporter that his office “would be more than willing to sit down and talk with Senator Casey about what we’re doing and how we’re moving forward.” Snap.

All of which brings us back to DEP’s Scott Perry, who told the Scranton paper to “blame it on me” for the mistakes in the AP story. Here’s what he told that same paper back in April when DEP first announced its intention to make its updated list public:

“If I honestly thought that fracking was causing a direct communication with groundwater resources, I wouldn’t be talking about how we have a chemical list. That is the ultimate half-measure. I would be saying, ‘This cannot occur.’ ”

“There has never been any evidence of fracking ever causing direct contamination of fresh groundwater in Pennsylvania or anywhere else,” [Perry] said.

Just so you have it handy, here’s a great list of the Top 10 quotes from DEP officials on the importance of responsible natural gas development – as compiled by the folks over at the Marcellus Shale Coalition. And here’s the video from a speech that DEP’s Scott Perry gave recently in the Northeast part of the state. Take a look at some of his quotes:

On the misconceptions he continues to encounter across the state:

• “When I’m talking to folks about the Marcellus, they try to point out some of its unique characteristics: ‘Well, Marcellus is different than all of these other wells; these are the deepest wells we have in the state.’ Well, that’s actually not true. We have over 11,000 permitted deeper wells in the Commonwealth; we have an entire statute devoted to regulating those wells.”

• “Some of the other things they say … ‘It’s the fracking. Fracking is what makes the Marcellus Shale different than all other wells in Pennsylvania. But [fracking] has been standard operating procedure in Pennsylvania since the ‘50s and … almost 100 percent of the wells drilled in Pennsylvania have been hydraulically fractured using the same [materials] that are being used with the Marcellus today.”

On Marcellus producers’ commitment to sound well construction and integrity:

• “I will tell you that the Marcellus operators have been building their wells to exceed our current regulatory standards; they’re building their wells in a manner that exceeds the [new] standards that we have actually proposed here, in many respects.”

On putting Marcellus water use in the proper perspective:

• “While five million gallons [of water] sounds like a lot, in the overall scheme of things, it’s not. And in fact, this industry at its peak, the Susquehanna River Basin Commission estimates, it will be using less water than our golf courses and ski resorts; it’s going to be using less water than recreation.”

On the record of safety and performance associated with hydraulic fracturing:

• “Just a note about fracking: First of all, it’s standard operating procedure in Pennsylvania. And it’s important to point out that we’ve never seen an impact to fresh groundwater directly from fracking.”

• “If there was fracturing of the producing formations that was having a direct communication with groundwater, the first thing you would notice is the salt content in the drinking water. It’s never happened. After a million times across the country, no one’s ever documented drinking water wells that have actually been shown to be impacted by fracking.”

• “A lot of folks relate the situation in Dimock to a fracking problem. I just want to make sure everyone’s clear on this – that it isn’t. What happened in Dimock was that a company was drilling in the Marcellus, and they encountered a shallow gas producing formation … which is common in this area of Pennsylvania. … It wasn’t a fracking problem.”

• “How many wells has fracturing damaged? I assume you’re referring to ‘how many drinking water wells.’? And in our experience, it’s been zero.”

ICYMI: Toughest Questions on Veracity of GasLand Come from Daily Show’s Jon Stewart

http://www.thedailyshow.com/watch/mon-june-21-2010/josh-fox

The Daily Show with Jon Stewart (June 21, 2010)

Stewart: “The industry itself has put out, they put out, literally, to debunk your film, it’s from Energy In Depth – EnergyInDepth.org.  It says when you say there’s 596 chemicals, they say 12. … They say that fracturing was never under … [cut off by Fox].”

• Report: “Although the hydraulic fracturing industry may have a number of compounds that can be used in a hydraulic fracturing fluid, any single fracturing job would only use a few of the available additives [not 596!]. For example, in [this exhibit], there are 12 additives used, covering the range of possible functions that could be built into a fracturing fluid.” (page 62, report from U.S. Dept. of Energy / Ground Water Protection Council)

Stewart: “They say they were never under those auspices.  They say in this document that they were never under the Safe Drinking Water Act – that they were always regulated by the states, and that the states have very strict regulations.”

• Fmr. EPA administrator (and current White House advisor) Carol Browner: EPA does not regulate – and does not believe it is legally required to regulate – the hydraulic fracturing of methane gas production wells under its [Safe Drinking Water Act] UIC program.” (letter, May 5, 1995)

http://mediacenter.tveyes.com/MediaCenter/39625/486371.5222/CNN_06-18-2010_10.34.28.wmv

CNN: America’s Newsroom (June 18, 2010)

• Energy In Depth: “Fundamentally, we’re talking about a process in hydraulic fracturing that’s been used now for 60 years. It’s been in commercial service for 60 years. It’s not new. It’s not unregulated. It’s not exotic…And as recently as a couple months ago, when the U.S. Senate Committee asked top administrators over at EPA if they could identify a single case of groundwater contamination associated with hydraulic fracturing, the answer was: Not one.”
• EID: “The interesting thing is that the gentleman that was in the film —  in fact, being show right now with the flammable faucet — he’s from Colorado, and the regulators went out to that well, did their surveys of it, did their research, collected data and came forward with a conclusion that that natural gas was … naturally occurring. That report was widely known, and it was available before the movie came out. And I think if the director was looking to give an even-handed account of what was actually happening, the reality of the situation wasn’t reflected in that film.”
• Cont’d: “Hydraulic fracturing has been aggressively regulated for years on the state level. It was never covered under the Safe Water Drinking Act — Josh was misstating the facts on that one as well.”

http://www.thepittsburghchannel.com/news/23979885/detail.html

WTAE-TV – Pittsburgh (June 21, 2010)

• EID: “Chris Tucker … said ‘Gasland’ director Josh Fox ignored a scientific report that showed the gas in the water in the Colorado example was naturally occurring and had nothing to do with drilling. ‘The film director has that report. He had access to the report before he went there, but obviously that doesn’t make for as good a story, and so he decided to exclude that,’ Tucker said.”
• Reporter links to EID’s materials: “An industry group called Energy In Depth gave Team 4 the following web links as a rebuttal to claims made in the ‘GasLand’ movie: Debunking GasLand // GasLand Debunked (PDF)”

No Second Acts for GasLand

Anti-gas shock-u-mentary makes nationwide debut on HBO – but latest version of the film no better or more accurate than previous cuts

GasLand director Josh Fox is certainly a busy man these days, but apparently not too busy to review a 4,000-word rebuttal to his film organized and sent around two weeks ago by Energy In Depth.

So what’d he think of the write-up? According to one columnist for a major national daily with whom we both spoke, Fox’s primary critique of the EID fact-check was that we had based it off an “earlier print of the film,” not the new and improved version purchased by HBO. The pay-channel iteration was going to be different, we were told — different from the film he had previously screened in dozens of cities, towns and villages all across the country. After all, it was an HBO product now. And certainly a network with more than 30 million U.S. subscribers couldn’t be expected to just run any picture show it got its hands on without conducting a thorough job of vetting and reviewing it first. Right?

Our curiosity was officially piqued. What would Fox decide to change? The possibilities were endless. He could decide to strike the portion of the film on Dunkard Creek, which even the local press in the area have derided as a “glaring error.” Maybe he’d decide to toss-in a quick mention of the report from Colorado regulators on the Markham well in Fort Lupton, which found the methane in the water had nothing to do with oil or gas development.

But then again, adding in that little disclaimer would sort of ruin the flammable faucet scene, wouldn’t it? How about that bit about the endangered species in Wyoming? That part’s factually incorrect as well, and easily confirmable as such. Would that segment make HBO’s final cut? EID had to find out – even if it meant staying up well past its bedtime to do it.

So we watched the film, again. And what do you know? Dunkard Creek’s still in there. And so is the flammable faucet. And so is the phantom claim that natural gas exploration in Wyoming is rendering the sage grouse extinct. Incidentally, if that’s true, someone should tell the Wyoming Game and Fish Commission. It might want to discontinue its sage grouse hunting season. Ditto for the mule deer. We shouldn’t be hunting endangered species.
So what did he actually change, then? In the final analysis, unfortunately, not a whole lot. Take a gander for yourself:

Previous version: “In 2004, the EPA was investigating a water contamination incident due to hydraulic fracturing in Alabama. But a panel rejected the inquiry, stating that although hazard materials were being injected underground, EPA did not need to investigate.” (31:32)

HBO version: “In 2004, the EPA was investigating water contamination incidents due to hydraulic fracturing across the country. But a panel rejected the inquiry, stating that although hazard materials were being injected underground, EPA did not need to investigate.” (30:17)

• Mercifully, someone informed the director that the 2004 EPA investigation in Alabama he cites in previous versions of the film did not actually take place. His new version for HBO excludes the mention of Alabama, but unfortunately still mischaracterizes EPA’s course of study in this area.

• In the new version, Fox says that EPA “was investigating water contamination incidents,” but then the agency apparently decided it “did not need to investigate” those incidents. Which one is it? Did EPA conduct an investigation associated with hydraulic fracturing in 2004, or didn’t it?

• Here’s what actually happened: In June 2004, EPA released the conclusions of a nationwide study on the relationship between the fracturing of coalbed methane wells and underground sources of drinking water. What did it find? “In its review of incidents of drinking water well contamination believed to be associated with hydraulic fracturing, EPA found no confirmed cases that are linked to fracturing …”

• More on the scope of research involved in the EPA study: “In addition to reviewing more than 200 peer-reviewed publications, EPA also interviewed 50 employees from state or local government agencies and communicated with approximately 40 citizens who were concerned that CBM production impacted their drinking water wells. EPA made a draft of the report available for a 60-day public comment period in August 2002.”

Previous version: “What I didn’t know was that the 2005 energy bill pushed through Congress by Dick Cheney exempts the oil and natural gas industries from Clean Water Act, the Clean Air Act, the Safe Drinking Water Act, the Superfund law, and about a dozen other environmental and Democratic regulations.” (6:05)

HBO version: “What I didn’t know was that the 2005 energy bill pushed through Congress by Dick Cheney exempts the oil and natural gas industries from the Safe Drinking Water Act.” (5:03)

• Once again, kudos to Fox for at least having the decency to convert what was previously an outright falsehood into a respectable distortion for the HBO premiere. As conceded here, the Energy Policy Act of 2005 contains no such exemptions to the Clean Water Act, the Clean Air Act, the Superfund law, or any of the other “dozen” statutes he cites.

• The 2005 energy bill does, however, contain language relating to hydraulic fracturing and the Safe Drinking Water Act (SDWA). Here’s what it does: It makes crystal clear Congress’s long-standing position that hydraulic fracturing was never intended to be regulated under SDWA, and further: that it’s best regulated by state experts and officials on the ground, and not by EPA staff in Washington, D.C. Is that what you would call an “exemption” to the law? Not exactly. It was simply a restatement of current law: how it is, how it was, how it’s always been. For the past 36 years.

• As for the claim that the Vice President of the United States “pushed” the bill through Congress, consider: The Energy Policy Act of 2005 earned the support of nearly three-quarters of the U.S. Senate (74 “yea” votes), including the top Democrat on the Energy Committee; current Interior secretary Ken Salazar, then a senator from Colorado; and a former junior senator from Illinois named Barack Obama. In the U.S. House, 75 Democrats joined 200 Republicans in supporting the final bill, including the top Democratic members on both the Energy & Commerce and Resources Committees. That’s quite a push.

Two minor changes; that’s all we noticed in watching the “new” version of the film on HBO last night. Of course, we did pick up on a few things we missed during previous screenings. For instance, Fox does an interview with one woman in Colorado, who coughs on camera and tells him that natural gas exploration is the reason “I’m never healthy.” In the next scene, she’s shown holding a cigarette. The woman also blames natural gas development for the occurrence of methane in her water well. For what it’s worth, Colorado regulators disagree: “COGCC sampled the McClure water well on 3/25/09. Sample results show naturally occurring biogenic methane gas in well and no impact from O&G [oil and natural gas] operations.”

Next up for GasLand? An encore airing on HBO slated for Thursday afternoon at 1 p.m. EST. Check back at energyindepth.org for updates and additional points of debunkery from the film.

Debunking GasLand

Josh Fox makes his mainstream debut with documentary targeting natural gas – but how much of it is actually true? 

For an avant-garde filmmaker and stage director whose previous work has been recognized by the “Fringe Festival” of New York City, HBO’s decision to air the GasLand documentary nationwide later this month represents Josh Fox’s first real foray into the mainstream – and, with the potential to reach even a portion of the network’s 30 million U.S. subscribers, a potentially significant one at that.

But with larger audiences and greater fanfare come the expectation of a few basic things: accuracy, attention to detail, and original reporting among them. Unfortunately, in the case of this film, accuracy is too often pushed aside for simplicity, evidence too often sacrificed for exaggeration, and the same old cast of characters and anecdotes – previously debunked – simply lifted from prior incarnations of the film and given a new home in this one.

“I’m sorry,” Josh Fox once told a New York City magazine, “but art is more important than politics. … Politics is people lying to you and simplifying everything; art is about contradictions.” And so it is with GasLand: politics at its worst, art at its most contrived, and contradictions of fact found around every bend of the river. Against that backdrop, we attempt below to identify and correct some of the most egregious inaccuracies upon which the film is based (all quotes are from Josh Fox, unless otherwise noted):

Misstating the Law

(6:05) “What I didn’t know was that the 2005 energy bill pushed through Congress by Dick Cheney exempts the oil and natural gas industries from Clean Water Act, the Clean Air Act, the Safe Drinking Water Act, the Superfund law, and about a dozen other environmental and Democratic regulations.”

• This assertion, every part of it, is false. The oil and natural gas industry is regulated under every single one of these laws — under provisions of each that are relevant to its operations. See this fact sheet for a fuller explanation of that.
• The process of hydraulic fracturing, to which Fox appears to be making reference here, has never in its 60-year history been regulated under the Safe Drinking Water Act (SDWA). It has, however, been regulated ably and aggressively by the states, which have compiled an impressive record of enforcement and oversight in the many decades in which they have been engaged in the practice.
• Far from being “pushed through Congress by Dick Cheney,” the Energy Policy Act of 2005 earned the support of nearly three-quarters of the U.S. Senate (74 “yea” votes), including the top Democrat on the Energy Committee; current Interior secretary Ken Salazar, then a senator from Colorado; and a former junior senator from Illinois named Barack Obama. In the U.S. House, 75 Democrats joined 200 Republicans in supporting the final bill, including the top Democratic members on both the Energy & Commerce and Resources Committees. 

(6:24) “But when the 2005 energy bill cleared away all the restrictions, companies … began to lease Halliburton technology and to begin the largest and most extensive domestic gas drilling campaign in history – now occupying 34 states.”

• Once again, hydraulic fracturing has never been regulated under SDWA – not in the 60-year history of the technology, the 36-year history of the law, or the 40-year history of EPA. Given that, it’s not entirely clear which “restrictions” in the law Mr. Fox believes were “cleared away” by the 2005 energy bill. All the bill sought to do was clarify the existing and established intent of Congress as it related to the scope of SDWA.
• Interest in developing clean-burning natural gas resources from America’s shale formations began to manifest itself well before 2005. The first test well in the Marcellus Shale in Pennsylvania, for example, was drilled in 2004. In Texas, the first wells in the prolific Barnett Shale formation were spudded in the late 1990s. But even before natural gas from shale was considered a viable business model, energy producers had been relying on hydraulic fracturing for decades to stimulate millions of wells across the country. The technology was first deployed in 1948.
• The contention that current energy development activity represents the “largest … drilling campaign in history” is also incorrect. According to EIA, more natural gas wells were developed in 1982 than today. And more than two times the number of petroleum wells were drilled back then as well, relative to the numbers we have today. Also, while it may (or may not) be technically true that fracturing activities take place in 34 states, it’s also true that 99.9 percent of all oil and gas activity is found in only 27 U.S. states (page 9, Ground Water Protection Council report)

(32:34) “The energy task force, and $100 million lobbying effort on behalf of the industry, were significant in the passage of the ‘Halliburton Loophole’ to the Safe Drinking Water Act, which authorizes oil and gas drillers exclusively to inject known hazardous materials, unchecked, directly into or adjacent to underground drinking water supplies. It passed as part of the Bush administration’s Energy Policy Act of 2005.”

• Not content with simply mischaracterizing the nature of existing law, here Fox attempts to assert that the law actually allows energy producers to inject hazardous chemicals “directly into” underground drinking water. This is a blatant falsehood. Of course, if such an outrageous thing were actually true, one assumes it wouldn’t have taken five years and a purveyor of the avant-garde to bring it to light.
• The subsurface formations that undergo fracture stimulation reside thousands and thousands of feet below formations that carry potable water. These strata are separated by millions of tons of impermeable rock, and in some cases, more than two miles of it.
• Once again, to characterize the bipartisan 2005 energy bill as having a “loophole” for hydraulic fracturing requires one to believe that, prior to 2005, hydraulic fracturing was regulated by EPA under federal law. But that belief is mistaken. And so is the notion that the 2005 act contains a loophole for oil and natural gas. As stated, hydraulic fracturing has been regulated ably and aggressively by the states.

(1:32:34) “Diana DeGette and Maurice Hinchey’s FRAC Act [is] a piece of legislation that’s one paragraph long that simply takes out the exemption for hydraulic fracturing to the Safe Drinking Water Act.”

• Here Fox is referring to the 2008 iteration of the FRAC Act, not the slightly longer (though equally harmful) 2009 version of the bill. The legislation does not, as its authors suggest, “restore” the Safe Drinking Water Act to the way it was in 2004. It calls for a wholesale re-writing of it.
• Here’s the critical passage from the FRAC Act: “Section 1421(d)(1) of the Safe Drinking Water Act is amended by striking subparagraph (B) and inserting: (B) includes the underground injection of fluids or propping agents pursuant to hydraulic fracturing operations related to oil and gas production activities.”
• Why would you need to “insert” new language into a 36-year-old statute if all you were looking to do is merely “restore” it?

Misrepresenting the Rules

(1:00:56) “Because of the exemptions, fracking chemicals are considered proprietary … The only reason we know anything about the fracking chemicals is because of the work of Theo Colborn … by chasing down trucks, combing through material safety data sheets, and collecting samples.”

• With due respect to eminent environmental activist and former World Wildlife Fund staffer Theo Colborn, no one has ever had to “chas[e] down a truck” to access information on the materials used in the fracturing process.
• That’s because there’s actually a much easier way to obtain that information: simply navigate to this website hosted by regulators in Pennsylvania, this one from regulators in New York (page 130; it will take a few moments to download), this one for West Virginia, this one maintained by the Ground Water Protection Council and the U.S. Department of Energy (page 63), and this one on the website of Energy In Depth.

(1:03:33) Dr. Colborn: “Once the public hears the story, and they’ll say, ‘Why aren’t we out there monitoring’? We can’t monitor until we know what they’re using. There’s no way to monitor. You can’t.”

• According to environmental regulators from Josh Fox’s home state of Pennsylvania, “Drilling companies must disclose the names of all chemicals to be stored and used at a drilling site … These plans contain copies of material safety data sheets for all chemicals … This information is on file with DEP and is available to landowners, local governments and emergency responders.”
• Environmental regulators from Fox’s adopted state of New York also testify to having ready access to this information. From the NY Dept. of Environmental Conservation (DEC) information page: “The [state] is assessing the chemical makeup of these additives and will ensure that all necessary safeguards and best practices are followed.”
• According to the Ground Water Protection Council (GWPC), “[M]ost additives contained in fracture fluids including sodium chloride, potassium chloride, and diluted acids, present low to very low risks to human health and the environment.” GWPC members include state environmental officials who set and enforce regulations on ground water protection and underground fluid injection.

Mischaracterizing the Process

(6:50) “[Hydraulic fracturing] blasts a mix of water and chemicals 8,000 feet into the ground. The fracking itself is like a mini-earthquake. … In order to frack, you need some fracking fluid – a mix of over 596 chemicals.”

• As it relates to the composition of fluids commonly used in the fracturing process, greater than 99.5 percent of the mixture is comprised of water and sand. The remaining materials, used to help deliver the water down the wellbore and position the sand in the tiny fractures created in the formation, are typically components found and used around the house. The most prominent of these, a substance known as guar gum, is an emulsifier more commonly found in ice cream.
• From the U.S. Dept. of Energy / GWPC report: “Although the hydraulic fracturing industry may have a number of compounds that can be used in a hydraulic fracturing fluid, any single fracturing job would only use a few of the available additives [not 596!]. For example, in [this exhibit], there are 12 additives used, covering the range of possible functions that could be built into a fracturing fluid.” (page 62)
• In the documentary, Fox graphically depicts the fracturing process as one that results in the absolute obliteration of the shale formation. In reality, the fractures created by the procedure and kept open by the introduction of proppants such as sand are typically less than a millimeter thick.

(50:05) “Each well completion, that is, the initial drilling phase plus the first frack job, requires 1,150 truck trips.”

• Suggesting that every well completion in America requires the exact same number of truck trips is absurd. As could be guessed, the number of trips required to supply the well site with the needed equipment and personnel will vary (widely) depending on any number of factors.
• As it relates to a source for Fox’s identification of “1,150 truck trips,” none is given – although it appears he may have derived those numbers from a back-of-the-envelope calculation inspired by a chart on page 6-142 of this document from NY DEC. As depicted on that page, the transportation of new and used water supplies, to and from the wellsite, account for 85 percent of the trips extrapolated by Fox.
• Unrepresented in this chart is the enormous growth in the amount of produced water that is currently being recycled in the Marcellus – with industry in Pennsylvania reusing and recycling on average more than 60 percent of its water, according to the Marcellus Shale Coalition.
• According to GWPC: “Drilling with compressed air is becoming an increasingly popular alternative to drilling with fluids due to the increased cost savings from both reduction in mud costs and the shortened drilling times as a result of air based drilling.” (page 55)

(51:12) “Before the water can be hauled away and disposed of somewhere, it has to be emptied into a pit – an earthen pit, or a clay pit, sometimes a lined pit, but a pit – where a lot of it can seep right back down into the ground.”

• The vast majority of energy-producing states – 27 in total, including all the ones to which Fox travels for GasLand – have explicit laws on the books governing the type of containment structures that must be used for temporarily storing flowback water. A number of producers today choose to store this water in steel tanks, eliminating all risk of that water re-entering the surrounding environment.
• GWPC (May 2009) “In 23 states, pits of a certain type or in a particular location must have a natural or artificial liner designed to prevent the downward movement of pit fluids into the subsurface. … Twelve states also explicitly either prohibit or restrict the use of pits that intersect the water table.” (page 28-29)
• GWPC (April 2009): “Water storage pits used to hold water for hydraulic fracturing purposes are typically lined to minimize the loss of water from infiltration. … In an urban setting, due to space limitations, steel storage tanks may be used.” (page 55)

Flat-Out Making Stuff Up

(53:36) “The Pinedale Anticline and the Jonah gas fields [of Wyoming] are directly in the path of the thousand year old migration corridor of pronghorn antelope, mule deer and sage grouse. And yeah, each of these species is endangered, and has suffered a significant decline of their populations since 2005.”

• 0 for 1: Three species of the pronghorn antelope are considered “endangered,” none of which are found anywhere near the Pinedale Anticline. Those are: the Sonoran (Arizona), the Peninsular (Mexico), and the Mexican Pronghorn (also of Mexico). According to the Great Plains Nature Center: “The great slaughter of the late 1800s affected the pronghorns … Only about 12,000 remained by 1915.  Presently, they number around one million and the greatest numbers of them are in Wyoming and Montana.”
• 0 for 2: Only one species of mule deer is considered “endangered”: the Cedros Island mule deer of Mexico (nowhere near Wyoming). The mule deer populations are so significant in Wyoming today that the state has a mule deer hunting season.
• 0 for 3: The sage grouse does not currently have a place on the endangered species list, according to the U.S. Fish & Wildlife Service (FWS) – and “robust populations of the bird currently exist across the state” of Wyoming, according to the agency. Interestingly, FWS recently issued a press release identifying wind development as a critical threat the sage grouse’s habitat.
• That said, producers in the area have taken the lead on efforts to lessen their impact and reduce the number of truck trips required to service their well sites. As part of that project, operators have commissioned a series of independent studies examining additional steps that can be taken to safeguard the Anticline’s wildlife.

(31:32) “In 2004, the EPA was investigating a water contamination incident due to hydraulic fracturing in Alabama. But a panel rejected the inquiry, stating that although hazard materials were being injected underground, EPA did not need to investigate.”

• No record of the investigation described by Fox exists, so EID reached out to Dr. Dave Bolin, deputy director of Alabama’s State Oil & Gas Board and the man who heads up oversight of hydraulic fracturing in that state. In an email, he said he had “no recollection” of such an investigation taking place.
• That said, it’s possible that Fox is referring to EPA’s study of the McMillian well in Alabama, which spanned several years in the early- to mid-1990s. In 1989, Alabama regulators conducted four separate water quality tests on the McMillian well. The results indicated no water quality problems existed. In 1990, EPA conducted its own water quality tests, and found nothing.
• In a letter sent in 1995, then-EPA administrator Carol Browner (currently, President Obama’s top energy and environmental policy advisor) characterized EPA’s involvement with the McMillian case in the following way: “Repeated testing, conducted between May of 1989 and March of 1993, of the drinking water well which was the subject of this petition [McMillian] failed to show any chemicals that would indicate the presence of fracturing fluids. The well was also sampled for drinking water quality, and no constituents exceeding drinking water standards were detected.”
• For information on what actually did happen in Alabama during this time, and how it’s relevant to the current conversation about the Safe Drinking Water Act, please download the fact sheet produced last year by the Coalbed Methane Association of Alabama.

(1:28:06) “Just a few short months after this interview, the Pennsylvania Department of Environmental Protection suffered the worst budget cuts in history, amounting to over 700 staff either being fired or having reduced hours and 25 percent of its total budget cut.”

• DEP press release, issued January 28, 2010: “Governor Edward G. Rendell announced today that the commonwealth is strengthening its enforcement capabilities. At the Governor’s direction, the Department of Environmental Protection will begin hiring 68 new personnel who will make sure that drilling companies obey state laws and act responsibly to protect water supplies. DEP also will strengthen oil and gas regulations to improve well construction standards.”

Recycling Discredited Points from the Past

Weston Wilson (EPA “whistleblower”): “One can characterize this entire [natural gas] industry as having a hundred year history of purchasing those they contaminate.” (33:36)

• Mr. Wilson, currently on staff at EPA’s Denver office, was not part of the team of scientists and engineers that spent nearly five years studying hydraulic fracturing for EPA. That effort, released in the form of a landmark 2004 study by the agency, found “no evidence” to suggest any relationship between hydraulic fracturing and the contamination of drinking water.
• Wilson has a well-documented history of aggressive opposition to responsible resource and mineral development. Over his 35-year career, Mr. Wilson has invoked “whistleblower” status to fight dam construction in Colorado, oil and gas development in Montana, and the mining of gold in Wyoming.  
• Wilson in his own words: “The American public would be shocked if they knew we make six figures and we basically sit around and do nothing.”

Dunkard Creek: Fox includes images of dead fish along a 35-mile stretch of Dunkard Creek in Washington Co., Pa.; attributes that event to natural gas development. (01:23:15)

• Fox’s attempt to blame the Dunkard Creek incident on natural gas exploration is contradicted by an EPA report – issued well before GasLand was released – which blamed the fish kill on an algal bloom, which itself was fed by discharges from coal mines.
• EPA report: “Given what has been seen in other states and the etiology of this kill, we believe the toxin from this algae bloom led to the kill of fish, mussels, and salamanders on Dunkard Creek. … The situation in Dunkard Creek should be considered a chronic exposure since chloride levels were elevated above the criteria for long periods of time.” (issued 11/23/09)
• Local PA newspaper calls out Fox: “One glaring error in the film is the suggestion that gas drilling led to the September fish kill at Dunkard Creek in Greene County. That was determined to have been caused by a golden algae bloom from mine drainage from a [mine] discharge.” (Washington (Pa.) Observer-Reporter, 6/5/10)

Mike Markham: Fox blames flammable faucet in Fort Lupton, Colo. on natural gas development

• But that’s not true according to the Colorado Oil & Gas Conservation Commission (COGCC). “Dissolved methane in well water appears to be biogenic [naturally occurring] in origin. … There are no indications of oil & gas related impacts to water well.” (complaint resolved 9/30/08, signed by John Axelson of COGCC)
• Context from our friends at ProPublica: “Drinking water with methane, the largest component of natural gas, isn’t necessarily harmful. The gas itself isn’t toxic — the Environmental Protection Agency doesn’t even regulate it — and it escapes from water quickly, like bubbles in a soda.” (Abrahm Lustgarten, ProPublica, 4/22/09)

Lisa Bracken: Fox blames methane occurrence in West Divide Creek, Colo. on natural gas development.

• That assertion has also been debunked by COGCC, which visited the site six separate times over 13 months to confirm its findings: “Stable isotopes from 2007 consistent with 2004 samples indicting gas bubbling in surface water features is of biogenic origin.” (July 2009, COGCC presentation by Margaret Ash, environmental protection supervisor)
• Email from COGCC supervisor to Bracken: “Lisa: As you know since 2004, the COGCC staff has responded to your concerns about potential gas seepage along West Divide Creek on your property and to date we have not found any indication that the seepage you have observed is related to oil and gas activity.” (email from COGCC’s Debbie Baldwin to Bracken, 06/30/08)
• More from that email: “These samples have been analyzed for a variety of parameters including natural gas compounds (methane, ethane, propane, butane, pentane, hexanes), heavier hydrocarbon compounds including benzene, toluene, ethylbenzene, xylenes (BTEX), stable isotopes of methane, bacteria (iron related, sulfate reducing, and slime), major anions and cations, and other field and laboratory tests. To date, BTEX compounds have not been detected in any of the samples.”

Calvin Tillman: Fox interviews mayor of DISH, Texas; blames natural gas development, transport for toxins in the air, benzene in blood.

• Tillman in the press: “Six months ago, nobody knew that facilities like this would be spewing benzene. Someone could come in here and look at us and say, ‘You know what? They’ve sacrificed you. You’ve been sacrificed for the good of the shale.’” (Scientific American, 3/30/10)
• A little more than a month later, Texas Dept. of State Health Services debunks that claim: “Biological test results from a Texas Department of State Health Services investigation in Dish, Texas, indicate that residents’ exposure to certain contaminants was not greater than that of the general U.S. population.” (DSHS report, May 12, 2010)
• More from the agency: “DSHS paid particular attention to benzene because of its association with natural gas wells. The only residents who had higher levels of benzene in their blood were smokers. Because cigarette smoke contains benzene, finding it in smokers’ blood is not unusual.”

Anything we miss? Guess we’ll be seeing you at the movies. Maybe not this one, though.

Kanjorski: Jobs, Revenue and Opportunity from Marcellus Shale “A Big F’n Deal” for PA

Good Thing Science Doesn’t Read Blogs

Texas Dept. of State Health Services: “The only residents who had higher levels of benzene in their blood were smokers. Because cigarette smoke contains benzene, finding it in smokers’ blood is not unusual.”

Evidence is Not the Plural of Anecdote

EID responds to NRDC’s running list of conjectures, distortions targeting safety, performance of hydraulic fracturing

Last month, our friends over at the Natural Resources Defense Council (NRDC) started up a running tally on their blog identifying “incidents where drinking water has been contaminated and hydraulic fracturing is a suspected cause.”

Of course, in a country with more than 470,000 active natural gas wells in operation, providing American consumers with more than 20 trillion cubic feet of natural gas each year, the unfortunate (and inevitable) reality of the situation is that the occasional incident will occur. And since a good number of these wells depend on fracturing to be viable, it’s also inevitable that those who oppose the use of hydraulic fracturing on ideological grounds (as opposed to scientific ones) will continue to blame the heavily regulated, 60-year-old technology for just about everything that may go wrong under the sun.

In a lot of ways, hydraulic fracturing has become the victim of its own success. Almost universally regarded as the sine-qua-non of energy production in America today, hydraulic fracturing – coupled with horizontal drilling technology — allows operators today to produce more than 10 times the amount of energy by drilling fewer than 1/10^th the number of wells.

That this is great news for the environment is so self-evident as to require no further explanation. But reduction of footprint aside, it also allows us to tap an abundance of resources that simply could not be accessed without it. And that’s the thing: NRDC would prefer these resources be kept in the ground – and at least has the courage to say so. But it knows the way to do that isn’t to attack the jobs, revenue or people associated with bringing this extraordinary resource to the surface. It knows it can’t attack the carpenter. So it’s decided to attack his tools instead. 

Observe that NRDC doesn’t issue press releases on well construction or cementing standards – two things considered orders of magnitude more relevant and important to the protection of drinking water than the execution of (or the solutions used in) the post-drilling process of fracture stimulation. But it’s not as easy to demagogue those things, they’ve found. “Hydraulic fracturing” is the thing with the scary-sounding name. And what’s this about it being invented by Halliburton?

In reality, the current campaign against hydraulic fracturing is tailor-made for the media and online environment in which we find ourselves today: heavy on hyperbole, light on facts, no time for explanation, no interest in the prosaic, no capacity for the technical. But here’s the good news: We’ve got the Internet too. And here below, we’ve decided to start our own running blog just like NRDC. The only difference? On theirs you’ll find rumor on top of speculation on top of conjecture on top of supposition on top of outright fantasy. On ours you’ll find facts. Updated regularly.

The NRDC blog currently lists 18 incidents that it believes are associated with hydraulic fracturing. We don’t address all 18 below in this particular issue alert – but don’t worry, we’ll get to them all eventually. You can bookmark this page to keep up with our progress.

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Pennsylvania: “In 2009, the Smitsky family in Hickory reported contamination of their drinking water after hydraulic fracturing of nearby natural gas wells owned by Range Resources. Their water became cloudy and foul-smelling. Testing found acrylonitrile, a chemical that may be used in hydraulic fracturing. The EPA is now investigating this incident.”

Reality: A review of the MSDS information on-file with the PA Department of Environmental Protection (DEP) reveals that no acrylonitrile was used in the process of fracturing this well. According to reports, Ms. Smitsky expressed her concerns with the well a full five years after the drilling procedure had been completed.

Questions also remain about the quality of the well’s water prior to the operations taking place. According to the Center for Rural Pennsylvania, an agency of the PA General Assembly, “approximately 41 percent of the [private water] wells tested [in PA] failed to meet at least one of the health-based drinking water standards.” Although a final report from DEP has yet to be released, initial drafts from the agency suggest that the company’s activities were performed safely with no impacts to groundwater.

Arkansas: “In 2008, Ms. Parish of Bee Branch reported contamination of drinking water during hydraulic fracturing of a nearby natural gas well owned by Southwestern. Her water smelled bad, turned yellow, and filled with silt.”

Reality: “Tests on complainants’ water found no traces of the chemicals used in the drilling fluids, officials said. Dick Cassat, chief lab supervisor at the Arkansas Department of Environmental Quality, said that water he’s tested after residents complained about nearby gas drilling was simply higher in iron and manganese, two naturally occurring substances in Arkansas groundwater sources.” (7/09)

Colorado: “In 2001, two families in Silt reported a water well blow-out and contamination of their drinking water during hydraulic fracturing of four nearby natural gas wells owned by Ballard Petroleum, now Encana Corporation. Their drinking water turned gray, had strong smells, bubbled, and lost pressure. One family reported health symptoms they believe are linked to the groundwater contamination.”

Reality: “The Amos/Walker water well has been sampled numerous times since [the Colorado Oil & Gas Conservation Commission] staff received the initial complaints in 2001. Benzene, toluene, ethylbenzene, and xylenes (BTEX), frac fluid constituents, or other oil and gas related contaminants have never been detected in any of the water samples collected from the Amos/Walker water well to date.” (7/05)

Wyoming: “Families in the small town of Pavillion have been reporting contamination of their drinking water for at least ten years. Hydraulic fracturing has been used in the many wells in the area owned by Encana. … Individuals report medical symptoms they believe are related to water contamination. The U.S. Environmental Protection Agency is investigating and has found contamination in 11 water wells, including toxic chemicals that may be from hydraulic fracturing fluids. Further tests are needed to determine the source of contamination.”

Reality: “Lind said the [Powder River Basin Resource Council], unlike some nationally based environmental groups, does not allege that fracking fluids are the cause of groundwater contamination anywhere in Wyoming. … [T]he Wyoming-based group is not trying to draw a link between fracking and incidents of groundwater contamination in the small town of a Pavilion, Wyoming … ‘We don’t want to accuse them of something they cannot prove. We’re their neighbors,’ he said.” (Platts’ Gas Daily, 4/20/10; subs. req’d)

New Mexico: “A 2004 investigation by the U.S. Environmental Protection Agency found two residents who reported that the quality of their water was affected by hydraulic fracturing.”

Reality: Interestingly, the source of this “2004 investigation” is none other than the 2004 EPA report on hydraulic fracturing – the one that found “no evidence” indicating a link between the use of hydraulic fracturing and the contamination of underground sources of drinking water.

As part of the agency’s due diligence in compiling that report, EPA stated in its concluding chapters that some residents with whom it had communicated postulated that hydraulic fracturing may have been the cause of problems with their wells. Although EPA included that testimony as part of its study, as per its charge, it concluded that “no confirmed cases” of water contamination related to hydraulic fracturing could be found.

Ohio: “In 2007, there was an explosion of a water well and contamination of at least 22 other drinking water wells in Bainbridge Township after hydraulic fracturing of a nearby natural gas well owned by Ohio Valley Energy Systems. More than two years later, over forty families are still without clean drinking water and are waiting to be connected to a town water system.”

Reality: On December 15, 2007, an explosion occurred in the basement of a home in Bainbridge, Ohio. Neither the house nor its furnishings suffered any kind of fire or smoke damage.

Subsequent to the event, the Ohio Division of Mineral Resources Management (DMRM) conducted an extensive, year-long investigation of the incident – at the end, publishing a report summarizing its findings and describing what it believed caused the incident. DMRM concluded the explosion was not caused by hydraulic fracturing. Moreover: “DMRM has concluded that it is highly unlikely that fluids used in the hydraulic fracturing process, or flow back fluids escaped from the borehole or entered into local aquifers.”

More to come.

No Joy in Mudville?

Faced with Opportunity to Get the Fact Straight on HF in Letter to EPA, Casey Strikes Out Again

WASHINGTON – Never mind that the safe and steady development of the Marcellus Shale in Pennsylvania is almost single-handedly responsible for keeping the state’s economic fortunes afloat at a time when the Commonwealth is shedding jobs at a faster rate than all but three states nationwide.

Never mind that this work is responsible for generating hundreds of millions of dollars for cash-strapped state and local governments, and breathing new life into industries across the state that quite simply would not exist were it not for the historic opportunity that the Marcellus has made possible.

Never mind all that. To Sen. Robert Casey (D-Pa.), the exploration of clean-burning natural gas resources in Pennsylvania represents a “highly variable and unpredictable” enterprise that threatens “health and safety of Pennsylvanians.” And in a letter sent this week to EPA administrator Lisa Jackson, Sen. Casey attempts to make that case with the help of several claims, assertions and characterizations associated with the 60-year-old technology used to produce these resources that, upon closer inspection, aren’t quite as accurate as he would have us believe.

Out-of-State, Out-of-Mind

National enviro groups quick to declare hydraulic fracturing to blame for water tests in Wyoming;
but what do enviro groups INSIDE Wyoming have to say?

Rep. George’s Fact-Free Fact-Finding Mission

Chair of PA House Environment Committee Travels Across the State to Learn  More About Hydraulic Fracturing, Comes Up Empty 

WASHINGTON – High school football season may still be five months away, but you would’ve thought it was right around the corner judging by the size and intensity of the pep rally staged by anti-energy activists and like-minded public officials in northeast Pennsylvania last night.

Characterized as a “field hearing” by Democratic state Rep. Camille “Bud” George, who held the event as far away as he could from his home in Clearfield Co., the forum included representatives from the Sierra Club and Clean Water Action league, as well as testimony from a local podiatrist and someone describing himself as a “naturalopathic” physician. The only thing missing? Anyone in possession of real, genuine facts related to responsible natural gas exploration in the Commonwealth.

Maybe we’re a day late and an acupuncturist short on this, but let’s see how last night’s “field hearing” holds up under an EID fact check:

Gone Fishin’ at the St. Regis

EPA hearings consider scope, direction of upcoming HF study – but will the agency follow the guidelines provided by Congress?

This week, EPA’s science advisory board (SAB) will host a series of scoping discussions at the St. Regis hotel in Washington looking into the safety and performance of a critical energy technology known as hydraulic fracturing– essential to natural gas exploration in America today, and a critical tool for leveraging enormous U.S. energy resources into jobs, revenue and opportunity for the American people.

The key question is: What will the board learn from this event? And how might those lessons contribute to the recommendations it will make related to the scope and direction of EPA’s upcoming study on hydraulic fracturing – the second such study it has undertaken in the past six years?

Last year, Congress directed EPA to pursue a very specific objective. Specifically, it asked the agency “to carry out a study on the relationship between hydraulic fracturing and drinking water” – language that was included in the Interior appropriations bill for fiscal year 2010. Will EPA abide by this stricture? Or will it seek to use its upcoming fracturing study as a means of targeting aspects of the energy exploration process that fall well outside the defined parameters set before it by Congress?

That, fundamentally, is the question being asked of the SAB today by supporters of responsible natural gas development. Here’s how EID executive director Lee Fuller framed the issue at the hearing:

We believe that the study needs to be framed around a key threshold question – whether the regulatory structures effectively manage the environmental risks of the fracturing process. If these risks are well managed, the other questions are meaningless. If the regulatory structures prevent pathways to drinking water, there is no risk.

Seems like a logical proposition to us. The only problem? In a series of proposed scoping questions released by EPA last month, the agency seemed to go out of its way to include things in its document that have nothing to do with the question at hand – which, remember, is the “relationship between hydraulic fracturing and drinking water.” Take a look at the initial EPA scoping documents yourself. Here are a few of the things that jump out to us:

The potential exposure pathways to be addressed by this study include ingestion, inhalation, dermal exposure through water, air, food, and environmental exposures.

What are the socioeconomic considerations that communities bring to perceptions of environmental impacts?

What is the potential to contribute to the spread of invasive or non-native species associated with HF activity?

What community health and environmental justice issues may be associated with HF activities?

Guess we must have missed the line in Congress’s Interior appropriations bill about “invasive species” and “air exposure.” But kidding aside, the real concern being expressed by natural gas producers in the meeting today is a simple one: If EPA has limited funds for this study, and a timeline of about two years to complete it, isn’t it possible that launching an open-ended fishing expedition might take time and resources away that EPA can and should be using to answer the questions posed to it by Congress? That’s what API senior policy advisor Stephanie Meadows wants to know:

In addition to having the appropriate expertise involved in this study, we believe that this planned study can best achieve its primary objective in a timely manner, by ensuring that the scope of this study is clearly focused on issues directly related to hydraulic fracturing as was put forth in the charge from Congress and does not become sidetracked by trying to examine broader industry issues at the same time. 

It’s not only industry that’s asking these basic questions. The Ground Water Protection Council (GWPC), a group of state groundwater regulators that’s considered “one of the nation’s leading groundwater protection organizations,” seems to have similar concerns over the seemingly random course of study openly being contemplated by EPA. Here’s just a snippet from the comments submitted today by GWPC executive director Mike Paque:

With regard to the proposed scope of the study we have concerns about the breadth of the effort. The scoping document appears to cover areas of oil and gas exploration and production activity that are essentially unrelated to the practice of hydraulic fracturing … Consequently, we believe narrowing the scope of the study to field practices directly related to hydraulic fracturing would result in a more focused and, ultimately, more effective study.

Naturally, for those with an ideological aversion to responsible energy development in America, the prospect of an open-ended, EPA-led inquisition of oil and gas production seems to suit them just fine. Heck, some are even using this week’s scoping hearing as an opportunity to sell their wares. These comments were submitted by filmmaker Debra Anderson, who released a documentary in 2009 calling on Congress to pass the anti-energy FRAC Act:

I notice that you are collecting information for [your] Hydraulic Fracturing Review. I am a filmmaker and we have just released a film on the environmental and social effects of natural gas and oil drilling. … Hydraulic Fracturing is a topic that is featured in the film. … For more information about the film go to www.splitestate.com. The committee can contact me at info@splitestate.com if they would like to request a copy for review.

For what it’s worth, part of our job here at EID is to sit through (and even occasionally watch) one-sided, fact-deficient films like Split Estate so you don’t have to. And then issue detailed rebuttals in response (you can find ours here).

It’s also our job to keep you updated on what goes down on at the St. Regis. Toward that end, earlier today, EID live-blogged a portion of the scoping hearing via our Twitter page. We’ll be updating the site as more information comes our way. Until then, happy scoping.

Not Very Brotherly

EID Fact Checks Philadelphia’s Anti-Natural Gas, Anti-Hydraulic Fracturing Resolution

WASHINGTON – Sure, Wayne County, Pennsylvania may be more than 150 miles away from Philadelphia. And yes, it may be true that folks up there – who happen to live closer to Syracuse than they do Philly – may have a potential interest in leasing private land for the purpose of responsible natural gas exploration in the area.  But why should any of that stop the city of Philadelphia from trying to shut the entire operation down?

This week, its city council officially put itself on record in support of hastening precisely that outcome, approving (unanimously) a resolution demanding that Delaware River Basin Commission (DRBC) – which is housed in New Jersey – deny a critical permit to an energy operator looking to produce natural gas clear on the other end of the state.

Now, is this the same clean-burning natural gas from the Marcellus that could “create nearly 200,000 jobs and generate more than $13 billion in Pennsylvania over the next decade,” according to today’s Pittsburgh Tribune-Review? Indeed it is. Unfortunately, Councilwoman Blondell Reynolds Brown, who remarkably serves as vice-chair of the city’s Commerce and Economic Development committee, doesn’t seem to be all that moved by the numbers. You see, the Marcellus doesn’t run through the southeastern corner of the state. So if Philadelphia can’t have it, the city council reasons — why should anyone else? (Btw: If you want to make your views known to DRBC before it renders a decision on the permit, click HERE – the window closes April 12)

Well, as you’d expect, the resolution passed by the city council this week targeting the use of hydraulic fracturing is a piece of work. How might it fare under the scrutiny of an EID fact check? Better than Villanova did against St. Mary’s, to be sure, but not as good as Temple did against Cornell (both lost).

CLAIM

“I knew the responsible thing to do was to send a strong message that drilling should not occur without an environmental impact statement,’ said Philadelphia City Councilwoman Blondell Reynolds Brown, who sponsored the resolution.” (Reuters, 3/25/10)

FACT

A host of independent studies, conducted by EPA and the Ground Water Protection Council – which counts state ground water regulatory agencies among its membership – have determined that fracturing has never contaminated groundwater. Carol Browner, top energy and environmental advisor to President Obama, wrote this in a memo about hydraulic fracturing as President Clinton’s EPA chief:

• There is no evidence that the hydraulic fracturing at issue has resulted in any contamination or endangerment of underground sources of drinking water (USDW). … Moreover, given the horizontal and vertical distance between the drinking water well and the closest methane gas production wells, the possibility of contamination or endangerment of USDWs in the area is extremely remote.

More recently, Steve Heare – the EPA’s top drinking water regulator – said that he knew of no “documented cases that the hydro-fracking process was contaminating water supplies.” And just weeks ago, other top EPA officials appearing before a top committee of the United States Senate could not identify a single case in which fracturing has ever been shown to contaminate groundwater.

CLAIM

“Energy companies are currently NOT [ed. note: capital letters, hers] required by law to report the chemicals they are using, and legislation to end this loophole, the Fracturing Responsibility and Awareness of Chemicals Act, sponsored by the Honorable Senator Casey and endorsed by 14 environmental organizations in Pennsylvania, is currently in committee in the United States Senate.”

FACT

1)     No reporting of chemicals, huh? A detailed catalogue of solutions used in the fracturing process – which are almost entirely (more than 99.5 percent) comprised of water and playground sand – is available on the PA DEP’s website, as well as HERE, HERE, HERE, HERE, HERE, HERE and HERE.

2)     Mandated by the Occupational Safety and Health Administration (OSHA), informational materials known as Material Safety Data Sheets (MSDS) are required to be kept at all well sites – and are available for use by emergency personnel responding to a potential disturbance. These sheets contain full listings of the materials involved in the fracturing process.

3)     Hydraulic fracturing has never been directly regulated by EPA under federal law, nor has it benefited from a single “loophole” in it. The bipartisan 2005 energy bill, supported by then-Sen. Barack Obama (D-Ill.), simply clarified the historic intent and execution of the existing statute, making clear that states – who have been regulating fracturing activities for more than a half century – were, are and will continue to be best-equipped to oversee this process.

The FRAC Act, however, would for the first time in the 36-year history of the Safe Drinking Water Act (SDWA) strip energy-producing states of their ability to regulate this technology, handing outright authority over the process to EPA.

CLAIM

“There have already been cases of private well contamination due to fracking in Pennsylvania.”

FACT

PA DEP: “Responding to recent concerns expressed by residents of Dimock Township, Susquehanna County, the Department of Environmental Protection has collected dozens of water supply samples in the Carter Road area and determined that nearby gas well hydro fracturing activity has not impacted local wells.” (Release, 3/27/09)

BONUS FACT CHECK

CLAIM

US Sen. Bob Casey, author of the anti-energy FRAC Act: “Senator Robert Casey, a Democrat, said he would work hard to defeat any move to keep states as the regulators. ‘If that kind of provision were in it, that would be an area where I would want to spend a good deal of time either altering it or removing it,’ Casey told Reuters.” (Reuters, 3/25/10)

FACT

Any chance Sen. Casey consulted with his state’s sitting DEP secretary before registering that threat?

• DEP secretary John Hanger: “The public can be assured that as more and more wells are drilled to capitalize on our abundant natural-gas resources, DEP will remain vigilant in protecting the state’s rivers and streams.” (Philadelphia Inquirer, 10/20/09)

Sen. Casey’s FRAC Act could give EPA outright authority to regulate fracturing in energy-producing states, stripping states of their ability to closely and effectively regulate this technology. In an editorial entitled “Power play: Fracturing plan wrong, indefensible,” The Oklahoman writes this:

• “The latest power grab is an attempt to switch regulation of hydraulic fracturing from the states to the Environmental Protection Agency. … Some believe the technique poses harm to drinking water supplies. U.S. Rep. Dan Boren, D-Muskogee, disagrees and says the regulatory shift would be “disastrous for the industry.” … Legislation has been introduced in Congress to require companies to disclose the chemicals used in the process and allow the EPA to ensure compliance with the Safe Drinking Water Act. This is a solution in search of a problem.” (6/15/09)

PA state Rep. Jim Christiana – author of a state resolution to maintain Pennsylvania’s ability to effectively regulate fracturing – said this about attempts from Sen. Casey and others to strips states of this right:

• “Recent efforts to regulate hydraulic fracturing under the Federal Safe Drinking Water Act, which would substantially increase the costs of producing our vast reserves of clean, domestic natural gas with no resulting environmental benefits, are unwarranted and were never intended by Congress or the Environmental Protection Agency. Pennsylvania’s oil and gas regulatory program is among the most stringent in the United States and places great emphasis on protecting groundwater supplies. I believe that additional and costly Federal oversight is unnecessary and cost-prohibitive.” (Release, 1/26/10)

Texas Health Dept. Determines “No Established Link” Between Shale Gas Development and Serious Health Issues

Town spokesman calls independent findings “positive news for all Flower Mound residents”

Language of Opportunity

EID letter to Kerry, Graham & Lieberman lays out the facts on hydraulic fracturing, importance of technology in fueling America’s shale gas revolution

Here’s the thing about Energy In Depth: We’re shale guys (and gals). We care about science, and technology, and geology. We care about hydraulic fracturing, and well integrity, and the sound management of produced water. We care about jobs. And opportunity. And revenues for the communities in which we work. We care about clean air, and safe water, and limiting disturbances – to land, people, and the surrounding environment. 

That’s our agenda, up front and in full. And that’s why we felt compelled this week to lend a hand, some insight, and maybe a few quick facts to a group of senators on Capitol Hill currently considering whether to include language on hydraulic fracturing in the latest version of their bill. According to several reports, Senators John Kerry (D-Mass.), Lindsey Graham (R-S.C.), and Joseph Lieberman (I-CT) may decide to take up the issue of hydraulic fracturing as part of a broader legislative effort seeking steep reductions in carbon dioxide emissions.

We take no position on that as-yet-unwritten bill; remember, we’re shale people. But here’s what we do know: Any plan that endeavors to reduce carbon in the atmosphere would be smart to acknowledge the central role that vast reserves of American-made natural gas from shale can play in delivering it. And any plan that even attempts to characterize its mission as “creating jobs” would be even smarter to avoid hamstringing the one technology being deployed today that represents the common denominator for the hundreds of thousands of shale gas jobs that have been created over the past five years.

That technology, by the way, is hydraulic fracturing. Here’s how Lee Fuller, executive director of Energy In Depth, addressed the issue in a letter he sent to Capitol Hill this week:

[R]eports have suggested your impending draft may include “sense of the Senate” language related to hydraulic fracturing – specifically, a provision that reinforces existing law, and acknowledges the critical role that states continue to play in ensuring the process is done safely.

Consistent with those objectives, what follows are several important facts regarding the safety, performance and necessity of hydraulic fracturing – facts I hope will inform your thinking on this issue as you render final decisions on the ultimate form your legislation will take.

The rest of the letter, excerpted in parts below and available for download in full here, lays out a fairly detailed description of what shale gas has made possible in America already (jobs), what it has the potential to make possible in the future (security, even more jobs), and how states have fared over the past 60 years in ensuring this process is well regulated and safely deployed (very well). How did we know these senators might benefit from a few extra facts at their disposal? We didn’t. But we do know that we haven’t been able to find a whole lot of shale gas in Massachusetts, South Carolina, or Connecticut – yet.

Let’s get to some excerpts from the letter. For starters, on whether hydraulic fracturing is some sort of “new” technology:

Depending on the regional biases of those you might ask, hydraulic fracturing was either first deployed in Kansas in 1947 or Oklahoma in 1949. Either way, we’re talking about an energy technology that’s been safely used … for more than 60 years — so much so, that nine out of 10 oil and natural gas wells developed in America today rely on fracturing technology to remain in service.

On what hydraulic fracturing is making possible right now:

Over the course of just the past 18 months, natural gas production has increased by a staggering 15 percent in the lower 48 … Shale gas has helped add more than 70 trillion cubic feet to U.S. reserves over the past several years, equivalent to more than half the total proven reserves of gas giants such as Qatar. If fully realized, the Marcellus Shale formation that underlies several states in the mid-Atlantic would become the second largest gas field in the entire world – second only to the South Pars/North Dome field that straddles Iran and Qatar.

On whether hydraulic fracturing has ever been regulated by EPA under the Safe Drinking Water Act:

Those who believe the Energy Policy Act of 2005 “exempted” hydraulic fracturing from regulation under SDWA forget one important fact: Hydraulic fracturing was never regulated under that law in the first place. Indeed, when SDWA was passed into law in 1974, hydraulic fracturing had been in safe use for more than 25 years. At no point was the concept of SDWA regulation over hydraulic fracturing considered – not then, and not (until recently) in the 36 years in which the law has remained on the books.

As mentioned, a copy of the full EID letter to the triad of senators (we also CC’d a few others, silly not to) can be found here. Might also direct your attention to two separate news items published this week mentioning the letter – this one in the Houston Chronicle, the other posted on the website of E&E News (subs. req’d).

It Was the Best of Times, It Was the Worst of Times

While Upstate NY Continues to Suffer Economic Hardships,
PA Neighbors Say “Shale Yes”; Reap Jobs, Revenues and Opportunity Because of It

IN HIS OWN WORDS: Resident of rural Tioga Co., NY tells EID what responsible shale gas exploration has the potential to do for his community:

• “It is critically important to our economy today, more than it’s ever been. In Tioga County, we’re a rural area, one of the poorest areas of Appalachia. The average dual household income is about $38,000 … A lot of my friends and neighbors can’t pay their bills. It will help lower their bills, lower their property taxes, and help give them the jobs they need to pay their bills. It’s critical to us. It’s critical to the country.”

Cause and Effect? Exploration Activity in PA (Blue) vs. NY (Orange) Since Jan. ‘08

Sharing Is Caring

White House staffer “unclear” whether info on hydraulic fracturing is available to the public; EID clears up the confusion

It might very well be the most under-reported aspect of the debate surrounding hydraulic fracturing today: namely, the willingness of Carol Browner in the mid-1990s — then, EPA administrator; now, top energy advisor to President Obama — to directly engage opponents of fracturing technology with the facts on its use, the science on its safety, and the history supporting the proposition that states, and not EPA, are best equipped to regulate the process effectively.

Nearly fifteen years later, the technology defended by Ms. Browner in a series of letters back then is being called upon today to lead a veritable revolution – one with the promise to recast the energy and environmental future of this country, while retooling its engine of economic growth in a way that creates jobs, revenue and long-term opportunity for the people who need it most.

One wonders whether Ms. Browner’s current staff has read any of those letters of yore. Earlier this week, Joseph Aldy, a top Browner deputy, told a Washington audience that he’s “sort of” concerned that the solutions used in the fracturing process might contaminate drinking water — notwithstanding the existence of a 60-year track-record, and the testimony of his current boss, that suggest precisely the opposite conclusion.

To Dr. Aldy, it remains “unclear” whether a link exists between the use of hydraulic fracturing and the corruption of groundwater. Fortunately, what’s unclear to him is abundantly clear to several others who have studied this question for decades: EPA, for starters; the Ground Water Protection Council, which counts state ground water regulatory agencies among its membership; and again, Ms. Browner herself, who submitted the following when asked to assess whether a relationship existed between the fracturing of coalbed methane seams (which reside thousands of feet closer to the water table than shale formations) and the contamination of aquifers:

“There is no evidence that the hydraulic fracturing at issue has resulted in any contamination or endangerment of underground sources of drinking water (USDW). … Moreover, given the horizontal and vertical distance between the drinking water well and the closest methane gas production wells, the possibility of contamination or endangerment of USDWs in the area is extremely remote.”

But what do we actually know about the process today? And more important: How do we know that we actually know it? Epistemic questions aside, Dr. Aldy has some serious practical ones. To wit: “I don’t think we have the information to assess” whether hydraulic fracturing technology is safe, Aldy told a reporter this week — because information detailing what’s involved in the fracturing process is, to his knowledge, not part of the public domain.

Except that it is. In fact, according to the Ground Water Protection Council, every state in which shale gas exploration actively takes place requires operators and service companies to provide a list of frac-related materials to state agencies; on the federal level, the Occupational Safety and Health Administration (OSHA) requires producers to keep similarly exhaustive documents on-site as well – information known as a Materials Safety Data Sheets (MSDS). Indeed, these sheets not only list the specific compounds found in a specific treatment in use at a specific well site, but they also contain detailed technical information that can be used by first-responders and medical personnel in case of an emergency.

Here’s what one of those sheets look like. Here’s just one of the places you can go to search for them. And if you don’t have time for that, here’s where you can go to get lists derived from those sheets. Here’s another place (page 62). And another. But wait: You thought that information was secret, right? Not according to New York, which considers MSDSs to be “public information ineligible for exception from disclosure as trade secrets or confidential business information.” And certainly not according to Pennsylvania, which posts this information online as well. In fact, here’s the statement sent out by the Marcellus Shale Coalition just hours after the Aldy comments hit the ‘net:

“[W]e recognize the need to educate and engage stakeholders, policymakers, regulators, and concerned citizens, which is why we worked with the Pennsylvania Department of Environmental Protection (DEP) to fully disclose fluids used in Marcellus Shale. In fact, DEP lists these fluids publicly on its webpage. And these fluids are mandated by the federal government to be at all well locations, too.”

Here’s the thing about water safety: It’s a simple function of well integrity. And here’s the thing about well integrity: It’s the object of aggressive (and long-standing) regulation and oversight by the states. Believe it or not, when it comes to safeguarding the public’s supplies of drinking water, it really doesn’t matter what goes into the well, or what comes out. It doesn’t matter whether you’re producing natural gas, or oil, or water, or even geothermal. And here’s the kicker: It doesn’t even matter whether you’re using hydraulic fracturing technology to access it.

What truly matters here is the pathway – specifically, the ability to prevent that which is found inside the wellbore from “communicating” with phenomena that exist naturally outside of it. So how do producers ensure that never the two shall meet? Multiple layers of steel casing, for starters – installed in a way that ensures every inch of the wellbore is suspended in isolation from that which surrounds it. And once the pipe is put into place, it’s time to cement it – sealing-off any remaining pathways, however small, that might otherwise provide an unacceptable conduit for water. Did we mention yet that the areas we fracture reside thousands (sometimes tens of thousands) of feet below the areas the support drinking water? Or that the two strata are separated by millions of tons of impermeable rock?

Of course, these facts will all eventually find their way to the surface – in a manner not dissimilar to the enormous amounts of clean-burning natural gas that have been made possible through the common (yet innovative) use of hydraulic fracturing. One just hopes that, unlike the natural gas, these facts don’t remained trapped underground for the next three million years.

All Wet: Pitt. Professor’s Claims on Shale Gas, Water Use Don’t Quite Reflect Reality

Pitt. Professor’s Claims on Shale Gas, Water Use Don’t Quite Reflect Reality

TODAY’S CLAIM: “Under normal circumstances, Volz does not talk in alarmed sound bites.”(11/13/08)

VOLZ FLASHBACK: “We have no control — we have absolutely no control — over our region’s water destiny.” (11/13/08)

Return to Sender

McMahon Letter to Gov. Paterson Decrying Hydraulic Fracturing Short on Facts, Long on Hysteria

Yesterday, U.S. Rep. Michael McMahon (D-N.Y.) fired off a letter to Gov. David Paterson demanding that the state institute a blanket ban on the use of hydraulic fracturing technology in developing clean-burning natural gas resources on roughly one million acres of mostly private land in New York State.

According to the congressman, and five other members of the state’s congressional delegation who signed on as well, hydraulic fracturing – a technology that’s been used for decades in New York to safely and responsibly develop both oil and natural gas – “endangers the drinking water of more than 9 million New Yorkers.” And so, in their view, it must be stopped before it even begins – notwithstanding “any potential economic benefits” that may accrue to his constituents in the form of new jobs, new revenue, and the promise of a clean and affordable energy future.

At 531 words, the McMahon letter is brief – tight, to the point, and serially inaccurate. Let’s see how well it holds up under an EID fact check?

Energy In Depth: Today’s News

A Note About Fracking. Pickens Plan. “The astonishing amount of natural gas which is now available in North America is largely due to relatively recent developments in recovering natural gas from shale deposits. Massive shale deposits under the continental United States in Texas, Louisiana, Arkansas and Appalachia contain enormous amounts of natural gas. But until fracking was developed to be a safe and efficient drilling technique, this natural gas was not available for commercial recovery. … Hydro-fracking is the safest, most efficient mechanism currently available for recovering that natural gas.

U.S. Natural Gas Hockey Stick: The Technology-Driven Energy Boom. Seeking Alpha, Prof. Mark Perry. “The Energy Information Administration released final data Tuesday for 2009 domestic natural gas production (data here), and the graph above shows that production hit a new record level in 2009, breaking the previous record set in 2008. … This surge in domestic natural gas production over the last three years has enabled the United States to overtake Russia as the world’s No. 1 producer of natural gas, and is all due to advanced drilling methods now being used to drill for gas through a type of rock known as shale.

Instead of increased oil tax, look to natural gas. Washington Times, LTE. “Fortunately, because much of our oil consumption is used for transportation, domestically produced natural gas provides a reasonable, clean and practical alternative. Many buses and trucks – and even some cars – are powered by natural gas. America has an abundance of natural gas from conventional stocks, and new extraction methods have increased those supplies. Unconventional sources hold the promise of a virtually unlimited supply. … Clean, safe and abundant, domestically produced natural gas is the practical and economical alternative energy source to reduce our use of foreign oil.

‘La. Way’ not perfect blueprint. Shreveport Times, Editorial. “The Louisiana Way, of course, also is made possible by blessings that aren’t man-made. This oil-producing state during the 2008 energy crisis added millions to state revenue. The Haynesville Shale has done the same for state and local government, as well as landowners, and created almost 500 direct jobs. Overall, it’s a bit too early to evaluate Jindal’s economic approach. He credits his policies with creating more than 35,000 direct and indirect jobs and generating $4.6 billion in new capital investment. We do like the attention the administration is paying to the needs of existing industry and that it is looking beyond traditional manufacturing sectors for economic opportunities of the future.

Beige book: Region’s economy improving. Pittsburgh Post-Gazette. “Economic conditions in the Pittsburgh region continued to show signs of improvement “although overall activity remains significantly below pre-recession levels,” the Federal Reserve said in a report Wednesday. The Fed’s latest Beige Book report said the economy improved, albeit modestly, in nine of its 12 districts, including the Fourth District, which includes Western Pennsylvania, Ohio, the northern panhandle of West Virginia and eastern Kentucky. … There were two positive trends noted in the Fourth District report: Natural gas drilling may get a boost from recent investments made in Marcellus Shale reserves, and some businesses are beginning to recall laid-off workers.

Reed: Health care needs ‘common-sense reforms’. Olean (NY) Times Herald. “Mr. Reed said he supports exploration for natural gas in the Marcellus shale formation that runs across the Southern Tier “in a safe and reliable manner.” He said the hydrofracking method of extracting oil and natural gas has been in use here for decades. Horizontal drilling uses new technology, however. Mr. Reed  said groundwater contamination from hydrofracking ”is an extremely remote situation.” He said the state and local governments were best suited to regulate the drilling, but acknowledged concerns expressed by the U.S. Environmental Protection Agency (EPA) over the state’s  environmental hydrofracking process.

Officials OK plan to drill Marcellus shale for natural gas. Pittsburgh Post-Gazette. “Officials in North Fayette and Robinson, Washington County, have approved an energy company’s plans to drill the Marcellus shale field, which contains natural gas. Oklahoma-based Chesapeake Appalachia LLC will create five natural gas wells on land that straddles the neighboring townships. The formerly strip-mined site, owned by Champion Processing Inc., is in an industrial zone bordered by Route 980, Steubenville Pike, Beech Hollow Road and Candor Road.

POGAM to merge with another industry group in light of Marcellus Shale drilling. Bradford (PA) Era. “Due to industry attention from the Marcellus Shale drilling, the Pennsylvania Oil and Gas Association (POGAM) plans to merge with the Independent Oil and Gas Association of Pennsylvania. Together, the organizations will create the Pennsylvania Independent Oil and Gas Association. Debbie Salinas, IOGA-PA membership coordinator, said the organizations will hold a vote Monday at the Knights of Columbus in Wexford. POGAM members will meet at 10:30 a.m., followed by the IOGA-PA meeting at 1 p.m.

Gazprom Sees LNG Competing With Shale Gas, Targets U.S. Market. Bloomberg. “OAO Gazprom expects liquefied natural gas shipments to compete with rising output of shale gas in the U.S. as the Russian producer aims to expand into the world’s biggest energy market. “Shale gas and LNG are competitive in one price range,” Gazprom Deputy Chief Executive Officer Alexander Medvedev said in an interview in Paris yesterday. “The market will say who will be in the market and with what.” Gazprom, the world’s biggest gas producer, plans to gain as much as 10 percent of the U.S. market by 2020. … U.S. shale gas could displace significant volumes of LNG, potentially growing to a similar scale as the entire current global LNG market by 2015, JPMorgan Chase & Co. said in a report on Feb. 9. The unconventional resource is “a complete game changer” in the U.S., BP Plc CEO Tony Hayward said in January at the World Economic Forum in Davos, Switzerland.

Deals in US onshore natural gas play grow in scope. Financial Times. “The ways in which foreign companies can benefit from the boom in US onshore natural gas is growing beyond those drilling and producing the energy. StatoilHydro, the Norwegian oil and gas company, has already done a deal to get into the exploration and production side of things. And on Tuesday it said it had entered into deals to deliver gas produced in the Marcellus shale field to New Jersey and New York.

Cramer Calls Anadarko Up to Majors. CNBC’s Mad Money. “Cramer reiterated his buy call on Anadarko Petroleum after its hard-hitting investor conference call today. The Mad Money host thinks APC doesn’t get enough credit from Wall Street and is widely viewed as a relatively small independent oil and gas producer. But the company “belongs with the likes of Chevron and Occidental Petroleum,” he said, “and should be called a major.”

Statoil eyes New York markets. UPI. “A deal to transport shale gas from the Northern Marcellus shale gas play in Pennsylvania gives Norway’s Statoil access to key U.S. markets, the company said. Statoil Natural Gas, the U.S. subsidiary of Norwegian energy giant Statoil, brokered a deal with Tennessee Gas Pipeline and Texas Eastern Transmission to move 70 billion cubic feet of shale gas to the New Jersey and New York City areas. … “These agreements secure access to some of the main pipeline systems for gas in the New York City area and thereby help maximize the value of our gas produced in the Marcellus shale,” he said.

East gives $50000 to 4-H. Wellsboro (PA) Gazette. “East Resources, Inc. today signed an agreement with Penn State’s Cooperative Extension Service to create a new 4-H endowment fund for Tioga County. East created the endowment with an initial principal investment of $50,000. The fund will be used to supplement financial support for the Tioga County 4-H program and may include educational awards for 4-H members. “East Resources has a major stake in Tioga County’s future through its oil and gas interests, and our contribution to this endowment reflects East’s commitment to help sustain that future,” says Bob Long, the company’s executive vice president.

Marcellus shale meeting in Hopewell. Pittsburgh Post-Gazette. “The president of the Marcellus Shale Coalition will join energy and government officials in a free public session about Marcellus shale issues in Beaver County from 8 to 10 a.m. Friday in Shadow Lakes Country Club, 2000 Beaver Lakes Blvd., Hopewell. Speakers from various organizations will discuss topics including water issues, transportation, natural gas rates, impact on local landowners and distribution of natural gas extracted from Marcellus shale. The meeting is sponsored by state Rep. Jim Christiana, R-Beaver.

A riddle, a rant, and the virtues of natural gas. Christian Science Monitor. “The Nat Gas Act is essentially the most intelligent thing that’s come before our elected officials in decades. It is a bill that will stimulate the conversion and new building of heavy vehicle fleets that run on our most abundant and clean-burning fuel, natural gas. Think city buses, 18-wheelers, sanitation trucks, etc. The legislation will provide tax credits and subsidies to help facilitate the necessary infrastructure build-out and lead to networks of nat gas fueling stations, eliminating the principal roadblock toward an energy-independent future.

Oil & Gas Expo sets registration deadline for May business event. Washington (PA) Observer-Reporter. “Regional businesses looking to market their services to the oil and gas industry are invited to attend the second annual Tri-County Oil & Gas Expo Business-to-Business event, scheduled for 10 a.m. to 3 p.m. May 8, at Washington County Agricultural Fair and Expo Center. Offering networking opportunities and a direct connection to the oil and gas companies working locally to develop the Marcellus Shale gas field, the business-to-business event will feature vendor exhibit space and informational break-out sessions presented by industry experts. Indoor and outdoor exhibit space is available for $150 a booth. The deadline to register for the event has been extended to March 15.

Energy In Depth: Today’s News

Fleming: Hydraulic regulations could hurt Haynesville Shale. Alexandria (LA) Town Talk. “U.S. Rep. John Fleming is blasting Democrats on a House committee for launching an investigation into the safety of hydraulic fracturing. “The same team that brought America the job-killing, tax-hiking cap-and-trade legislation appear to be at it again,” Fleming, R-Minden, said in a speech last week on the House floor. Rep. Henry Waxman, D-Calif., chairman of the Energy and Commerce Committee, recently wrote to eight oil and gas companies, questioning them about the chemicals they use for hydraulic fracturing, a process that uses pressure from water-based fluids to extract natural gas from shale. … He said the extra federal regulation would increase costs, reduce production and eliminate jobs. “Production would essentially grind to a halt, and billions of dollars in federal and state tax revenue would be at risk,” he said. Don Briggs, president of the Louisiana Oil and Gas Association, called the investigation into fracturing a “witch hunt.” NOTE: The Bossier (LA) Press-Tribune also reports.

Marcellus shale could be a boon or bane for land owners. Pittsburgh Post-Gazette. “When CNX Gas Corp. was spun out of Consol Energy Inc. in 2005, the infant company began life as a coalbed methane producer with tens of thousands of acres of land. Only later did it realize it held 161,000 acres that could produce natural gas from the sprawling geographical formation called the Marcellus Shale. … A gas company does it own homework before ever offering the lease, first by identifying parcels of land that hold production potential. That potential involves more than determining the likely presence of gas. Other factors that may be involved include access to water for use in the hydraulic fracturing process, and access to the interstate network of pipelines that transport gas across the country.

Attempting to score political points. The Oklahoman, state Rep. Mike Thompson. “Hydraulic fracturing is a safe and successful drilling method in which water, sand and chemicals are injected at high speeds into a well to fracture rock and free up natural gas. This is a method that has increasingly been used in many shale formations across the country and has led to the discovery of increased levels of domestic natural gas. … There are a number of reasons why this investigation isn’t needed. …the Interstate Oil and Gas Compact Commission conducted a survey that found there were no known cases of groundwater contamination associated with hydraulic fracturing.

Frac fluid fears show capacity for inconsistency. Oil & Gas Journal, Op-Ed. “Controversy over hydraulic fracturing fluids and their possible effect on drinking water demonstrates the boundless human capacity for inconsistency. Although chances are low that injected frac fluid will find its way down anyone’s throat, fear persists in parts of the US about contamination of subsurface drinking water. It persists despite the tens of thousands of frac jobs producers have performed over 60 years without fouling groundwater. … A reason the fear persists is that people don’t know what’s in the small fraction of most frac fluid that isn’t sand and water. The ingredients, in many cases, are commercial secrets. …So an activity mysterious to people unfamiliar with it contains something unknown, which opponents of the activity spin into fear.

A Natural Choice. Washington Post, Editorial. “In America’s climate debate, one of the most promising developments of recent months has been the growing recognition in Washington that natural gas may play a key role in curbing carbon emissions. The resurgence of gas comes through the discovery of massive deposits in Appalachian shale formations and elsewhere — a reserve that offers the prospect of stable domestic supplies and relatively low prices. Since burning natural gas produces half the emissions of burning coal, switching the two fuels could put a significant dent in America’s carbon footprint.

Weak Economy Gives Energy a Jolt. Wall Street Journal. “Meanwhile, Congress will investigate the environmental impact of hydraulic fracturing, or “fracking,” crucial to burgeoning shale-gas production. A leak of radioactive material is the ostensible reason for Vermont senators’ ire. But this also may reflect posturing ahead of elections as well as price negotiations for a new power-purchase agreement. Fracturing is an old technology already regulated by states. … A July 2009 study by Pennsylvania State University estimates developing the Marcellus shale basin added more than 48,000 jobs in the state last year. Unemployment there was 540,900, or 8.9%, in December. Governors grappling with severe budget gaps also might note the forecast of an extra $12 billion in net present value terms for Pennsylvanian state and local taxes out to 2020. That is equivalent to half a year’s total state-tax revenue.

DEC standards high. Press & Sun-Bulletin (NY), LTE. “Given the scaremongering of the environmental extremists who have weighed in on this issue, the most important disclosure at this rally was the fact that more than 10,000 wells have been drilled in New York over the last two decades under present regulations with only one minor incident involving methane seepage which was corrected within three days. This safety record is a testament to the professionalism of the DEC and the high standards already incorporated into state law with respect to natural gas exploration and production.

$53 million Washington-Greene gas pipeline plan is topic of meeting. Pittsburgh Post-Gazette. “The Federal Energy Regulatory Commission will hold a public meeting Wednesday to accept comments and review the environmental impacts of a $53 million natural gas pipeline project proposal in Washington and Greene counties. The project proposed by National Fuel Gas Supply Corp. would increase capacity of existing pipelines by 150 million cubic feet a day and enable the system to better carry natural gas from the quickly multiplying number of Marcellus shale deep wells in southwestern Pennsylvania. “Local Marcellus shale producers need a way to get new production to market, and this will assist them,” said Sandra James, a spokeswoman for National Fuel Gas.

Natural gas workers boost real estate market. Pittsburgh Post-Gazette. “The Marcellus Shale field can be portrayed as a boon or a bane, depending on whom you talk to, but to the Realtors operating in Washington County, there’s not much of a downside. Natural gas drilling companies and firms related to the development of the shale are doing some hiring locally. But many of the field crews, engineering experts and front-office workers are imported from out of state because they have an expertise that the native work force doesn’t yet possess. They’ve been coming here since 2003, scouting drilling sites and establishing satellite offices. In 2008 and 2009, the pace of new arrivals has quickened. Their presence, and their need for housing, has helped keep afloat Washington County’s middling real estate market.

Atlas Energy Retains Jefferies to Sell Shale Stake. Bloomberg. “Atlas Energy Inc., the Pennsylvania- based natural-gas producer, retained Jefferies & Co. to sell a stake in as many as 584,000 acres it controls in the gas-rich Marcellus Shale, Chief Executive Officer Edward E. Cohen said. Atlas said Marcellus output reached the equivalent of 60 million cubic feet of gas in the fourth quarter from the company’s first 10 horizontal wells tapping the formation, all drilled last year. Producers are drilling sideways for more than 2,000 feet (610 meters) through the shale beds, fracturing rock with water, sand and chemicals to free trapped gas.

Marcellus by-product: Lots of legal work. Philadelphia Inquirer. “If there is such a thing as a typical small-town law practice, then Les Greevy’s could serve as the template. Or at least it might have a few years ago. Greevy, 66, has been practicing law in Williamsport in the state’s northern tier for more than 40 years, just as his father and grandfather had before him. His practice traditionally centered on representing municipal governments, insurance companies, and individual clients seeking advice on estate and trust matters. Then came the Marcellus Shale natural-gas discovery, and Greevy’s world was turned upside down.

Energy In Depth: Today’s News

Energy Industry Reps Greet House Fracking Probe With Shrug. New York Times. “Energy industry insiders say a new House probe of hydraulic fracturing is unlikely to hinder development of new domestic shale gas plays or stall a massive merger between Exxon Mobil Corp. and a large independent gas producer. … “The week started out pretty good for us,” said Chris Tucker, a spokesman for the industry-backed group Energy in Depth. Energy in Depth’s Tucker said: “Maybe if we take the most positive viewpoint, it could be an acknowledgement that attempts to ram through legislation aren’t the best way to proceed, and before rewriting the law, it might be a good thing to do some work in terms of educating and try to get as many materials as possible to render a good decision.”

Waxman, Markey using scare rhetoric. Shreveport (LA) Times, LOGA’s Don Briggs. “This process is vital to stimulating and increasing oil and natural gas production from unconventional and low permeability reservoirs. … Many may not be aware, but for decades the process of hydro-fracking has been effectively regulated by the states. In mid-2009, the Groundwater Protection Council released a study on the regulation of oil and gas field activities saying, “The regulation of oil and gas field activities, including hydraulic fracturing, is best accomplished at the state level where regional and local conditions are best understood.” … If hydraulic fracturing were to be regulated by the EPA, President Obama could easily shut down the development of the Haynesville Shale, resulting in the loss of thousands of jobs and billions of dollars in investment.

Gas pains: Probe, study target fracturing technique. The Oklahoman, Editorial. “The tag team that tried to bring you cap and trade is targeting hydraulic fracturing, a vital technology for ensuring a reliable supply of natural gas.  U.S. Reps. Henry Waxman, D-Calif., and Edward Markey, D-Mass., are investigating fracturing for its alleged environmental effects. Both support greater use of energy other than imported oil; both realize the environmental benefits of natural gas relative to coal. Yet they seem to have bought into the fear-mongering extant over fracturing. The technique involves injecting water, sand and chemicals into shale formations. This cracks open the shale and facilitates natural gas production. … If America is to move toward greater energy independence, natural gas is a key component. And hydraulic fracturing is a key method for making that happen.

Marcellus shale hearing: Ensuring the protection of our resources. Clearfield (PA) Progress. “According to Chairman Scott Hutchinson, a state representative from Venango County, Pennsylvania needs to make sure the laws are adequate to deal with problems that may arise with drilling. “We need to take advantage of the wonderful natural resource,” he said. … “Our job is to produce gas and protect the future,” said John Hines, deputy secretary for water management from DEP. He explained the Marcellus shale gas reserve could potentially hold “enough gas to fully supply the nation for 10 or more years.” Hines added producing that gas could create new wealth as well as new jobs, “but not at the sacrifice of our water resources.” … During his testimony, Hines attempted to dispel rumors that certain “secret” chemicals were used in the fracing process. He said that DEP distributed a list to the public of all the chemicals that were used. Hines said the Material Safety Data Sheets were also distributed to local emergency responders. The list is available on DEP’s Web site.

Q&A with Mike Terry: Hydraulic fracturing ‘recipes’ are 99 percent sand, water. The Oklahoman. “The major components of hydraulic fracturing fluid are well-known, with water and sand accounting for up to 99 percent of the solution. The remaining additives are the same compounds found in soaps, detergents, cosmetics, medications and chemicals commonly found in households. Like Kentucky Fried Chicken’s 11 herbs and spices, oilfield service companies, including those founded right here in Oklahoma, have invested time and money in creating formulas that improve the quality of the fracturing fluid. How much and which one of those additives is used varies by company, and they are hesitant to divulge “secret recipes.” … Hydraulic fracturing has been used commercially since 1949, and there have been no known cases of drinking water contamination. … Increased regulations will lead to a decrease in competition.

Western Wyoming’s once-booming gas industry approaches economic and regulatory crossroads. Associated Press. “Drilling rigs on the horizon underscore that cattle ranching and tourism no longer drive the economy in this picturesque town at the foot of the Wind River Range. But the future of the natural gas industry in the Pinedale, Wyo., area — scene of a decade of intense drilling into two of the nation’s richest gas fields — has become less certain because of the recession and the Obama administration’s intention to make some unspecified changes to Bush-era drilling policies. … “It’s certainly a concern,” said Bruce Hinchey, director of the Petroleum Association of Wyoming, an oil and gas lobbying group. “We’ve seen companies take their dollars and put them elsewhere because they had permits in hand and were able to drill and explore and develop.”

Gas tests could be precursor to widespread development. The (PA) Daily American. “Natural gas developers may soon discover whether Somerset County’s Marcellus Shale is the gold mine they had hoped for. Representatives from two major industry stakeholders indicated that major development in this area could come as early as this summer. “I think that’s pretty realistic — if there’s gas to be had,” said Kristi Gittins, communications vice president for Dallas-based Chief Oil & Gas. “Obviously our goal is to get gas on a pipeline as quickly, safely and as environmentally friendly as possible.” … But unless the region’s Marcellus Shale is found to be dry of natural gas, it may be a matter of time before the industry entrenches itself in America’s County. “We’d like to be a long-term player here in the area,” Trujillo said.

Shale Drilling Moves North, Upending Canada Gas Forecasts. Dow Jones. “An unconventional drilling technique that sparked a boom in U.S. gas production has made its way north. Companies in Canada, the world’s fourth-largest natural gas producer, are turning their attention to gas trapped in shale rock. In the U.S., the emergence of horizontal drilling and high-pressure liquid injections into these formations helped fuel the boom in gas supplies and subsequent bust in prices. The rise of shale gas in Canada further blurs an already uncertain outlook for the natural gas supply-and-demand balance in North America, leading some companies to seek a way out of a market that historically has been self-contained. It also represents a stark reversal of previous forecasts, some of which predicted that the decline in Canada’s conventional gas supplies would force it to become a net importer of gas by 2030.

Merger could boost Schlumberger’s gas role. Houston Chronicle. “Through its proposed merger with Houston-based Smith International, oil field services giant Schlumberger will be better positioned to expand its presence in production of North American natural gas, a resource expected to play a major role in meeting the continent’s future energy needs. … It’s attracting growing interest because of improved technology in hydraulic fracturing, which frees shale gas by pumping fluid and sand into reservoirs to crack the rock. … “We are, if you like, at a very early stage of understanding how shale gas is going to be produced and while (fracturing) will always be a key element in the production of shale gas, as we get better at identifying the sweet spots in shale reservoirs, drilling will systematically become more important,” Gould said. NOTE: The New York Times, Reuters, and the Oil & Gas Journal also report.

Merger adds doubts to local jobs outlook. Houston Chronicle. “Already reeling from a string of recent setbacks on the employment front, Houston faces the potential for still more job losses if Schlumberger’s $11 billion deal to buy rival Smith International goes through. Since both firms keep significant corporate offices in Houston, many employees here could be affected as Schlumberger seeks to eliminate what it says are duplications in the new corporate structure. But most of the companies’ operations do not overlap, and there will be new opportunities for employment as economic conditions improve and demand grows for its products and services, said Schlumberger spokesman Stephen Whittaker, who called the merger “good for Houston.”

Calgary companies to appear before U.S. committee. Calgary Herald. “Two Calgary companies have been issued information requests by the U.S. government’s Energy and Commerce committee looking into potential impacts of hydraulic fracturing in shale drilling regions such as Pennsylvania. In a statement on the committee’s website, Democrats Henry Waxman and Edward Markey said they sent letters to the chief executives of eight service companies, asking them to voluntarily disclose the contents of fracturing fluids used to stimulate shale gas wells that are suspected of contaminating drinking water, ahead of an investigation into the allegations in March.

Two Republicans compete for Railroad Commission as pivotal year approaches. Fort Worth Star-Telegram. “The agency that helped kindle the Barnett Shale natural gas boom is headed for a transformational year. Its chairman is up for election in November, with a challenger in the Republican primary and a Democrat running in the general election. And once that’s over, the commission is scheduled for a sunset review during the 2011 legislative session. The Railroad Commission regulates Texas’ oil and gas industry. It is governed by three commissioners, who are elected statewide. Over the last decade, the commissioners wrote critical rules on well spacing and density that allowed the development of the Barnett Shale — a huge natural gas field that lies under Fort Worth and about 15 surrounding counties.

Company’s system purifies liquid in Marcellus Shale drilling. Pittsburgh Tribune-Review. “Drilling companies rushing to withdraw Pennsylvania’s natural gas supplies trapped in the Marcellus Shale rock formation face liquidity issues. The problems: Where to find one million to five million gallons of water needed to fracture shale a mile underground to release gas, and what to do with the 30 percent to 60 percent of the polluted waste water returned to the surface once the process is completed? … The Altela process virtually eliminates most pollutants in waste water, leaving behind distilled water containing 20 times less salt that ordinary tap water, Altela says, which can be used repeatedly in the fracturing process, called “fracking” by drillers.

DEP plans to boost numbers of drilling inspectors. Pittsburgh Post-Gazette. “The number of drilling inspectors at the state Department of Environmental Protection would increase by more than 50 percent in the next fiscal year. That’s because oil and natural gas companies continue to drill new wells across the state, department officials told House members at a budget hearing Monday. As a result of additional funding from an increase in drilling fees, the department hired 37 more well inspectors last summer and will add another 68 by this summer, for a total number of gas and oil well inspectors of 193. Overall, Mr. Hanger said DEP has about 2,835 employees, down from more than 3,000 five years ago.

More questions about the true scale of shale gas. Houston Chronicle. “Last week I highlighted a report from Bernstein Research that raised concerns about the economics of the Haynesville Shale, saying the core production areas were proving to be smaller than expected and the cost of maintaining production is staying quite high. Allen Brooks, one of our guest bloggers, also noted that report as well as another by well-known shale skeptic Arthur Berman.

Gas driller hearing this Wednesday. Wayne (PA) Independent. “Stone Energy Company has a docket before the Delaware River Basin Commission (DRBC) to withdraw to to 700,000 gallons of water a day for a total of 30 days from the West Branch of the Lackawaxen River in Mount Pleasant Township, to support the company’s existing gas well in adjacent Clinton Township. … A group calling themselves the “Delaware Riverkeeper Network” is concerned with the drilling, and specifically what the fracturing will do to the environment, comparing it to the anthracite mining done in the past. “Pennsylvania is being threatened by another fossil fuel industry that wants to mine ancient, non-renewable reserves from the Earth–natural gas,” stated the group in a press release. “Hydraulic fracturing involves a dangerous cocktail of chemicals and sand and an enormous amount of water,” stated the group.

EMPTY NEST

Local PA Audubon Society Chief Grouses over Responsible Shale Gas Exploration – His Cardinal Sin? No Facts

Here at Energy In Depth, we’ve seen our fair share of outrageous claims directed at the responsible development of clean-burning natural gas in the Marcellus shale. But rarely have we come across a single newspaper column that anthologizes them as exhaustively as the one we recently saw in the Wilkes-Barre (Pa.) Times Leader — penned by Greater Wyoming Valley Audubon Society chief Robert Wasilewski.

Take a look for yourself — if you’re looking for a thorough list of half-truths, distortions and outright misrepresentations related to the work being done right now in Pennsylvania to convert the state’s abundant energy resources into thousands of jobs and billions in local revenue, this is as complete as it gets.

Thankfully — and at the same time, regrettably — we’ve been down this road before. What follows is a quick side-by-side comparing Mr. Wasilewski’s claims with the actual facts as they exist:

Energy In Depth: Today’s News

Drilling in Upstate NY. Press & Sun-Bulletin (NY), Victor Furman. “We are residents and taxpayers who believe not only is gas drilling in NY is good for the USA and its efforts on reducing foreign dependence on fuel, that it will be beneficial to our local communities by creating a tax base, thousands of local long term jobs. ASd a great increase in services such as new housing, restaurant, hotel and auto, as well as many more. There are extremist who have no stake in our community who sensationalize media reports of minor surface spills in PA. using fear tactics such as ‘frac today die tomorrow.’ Fact is there are already 6,680 gas wells in production all across NY in which one of 10 were hydrofracked with no adverse environmental impacts associated with any of them. I firmly believe that we as a community should embrace the exploration and recovery of natural gas to benefit our community, our state, our country.

Shale gas gives a lift on two fronts. Houston Chronicle. “Natural gas drilled from shale formations is touted by the energy industry as the America’s best solution to short-term energy demand, a resource that will simultaneously reduce foreign oil dependency and carbon emissions. It also may be a solution for a problem that has long vexed big oil companies. For years, the majors have struggled to replace their reserves. The big deposits they need are becoming more difficult to find around the world, and many are now controlled by state-owned oil companies. “The trends are going in the wrong direction,” said Maynard Holt, co-president of Houston-based Tudor Pickering Holt & Co. “Enter shale gas.” … “If it’s as good as they suggest, we got lucky as a country,” Swanson said.

More than 120 attend meeting on gas drilling. Oneonta (NY) Daily Star. “Mayor Calvin Tillman of DISH, Texas, said an air-quality study by Wolf Eagle Environmental Engineers and Consultants – a private firm hired by the town – showed high levels of carcinogenic and neurotoxin compounds. … Tillman said there have been reports of horses and humans becoming ill. “There is certainly something going on when you have that many horses close to the facility with problems,” Tillman said. “There was just a noxious odor that hung around our area.” … “The drilling money is like heroin, and a lot of the small communities have gotten addicted to it,” Tillman said. … During a question-and-answer session, Tillman fielded a range of queries, including those on hydraulic fracturing and the quality of life in his town.

2 events to tout benefits, dangers of gas drilling. Press & Sun-Bulletin (NY). “With the intensity and organization of hard-fought political campaigns, both proponents and critics of the natural gas industry have events lined up this month to help promote their message about what Marcellus Shale development will mean for Broome County. People warning of unacceptable environmental risks under current regulations will welcome Dish, Texas, Mayor Calvin Tillman, who will visit Binghamton on Thursday to share his cautionary tale about the effects of natural gas drilling. Drilling proponents, meanwhile, are organizing the second in a series of events called the Natural Gas Development Summit, scheduled for Feb. 26 at the Binghamton Regency.

Stop the war on oil and gas. New York Daily News, Op-Ed. “With the release of its budget for the next fiscal year, the Obama administration is continuing its assault on the U.S. domestic oil and gas industry. Under cover of beginning to transition America to a cleaner, greener, more sustainable energy future, the administration in fact is hitting our top domestic energy producers hard – a hit that will hurt American consumers at the worst possible time. Calling for an end to “subsidies” to the oil and gas industries, the administration’s budget raises taxes on oil and gas by $36.5 billion over 10 years. But current tax preferences for oil and gas producers are hardly subsidies. They are instead methods that allow private companies to keep more of the money they earn while those companies provide low-cost energy to the American consumer.

V&M Star’s pipe mill shows rise in productivity. Youngstown (OH) Vindicator. “V&M will start construction next month on its $650 million pipe mill, which will employ 350. Two of three new mills, V&M and Boomerang, will produce pipe for drillers in the Marcellus Shale, as well as other drillers. The Marcellus Shale is a large natural-gas field hidden in shale deposits under eastern Ohio and nearby states that has been opened up by advanced drilling techniques. Gregg Eisenberg, Boomerang Tube president, said the nature of drilling in shale creates a large demand for pipe producers. … About 20 percent of natural gas is used by industry, and plants that make steel, chemicals, plastics and other materials are expected to use more gas as the economy improves, he said.

The area could use some good news, and it got it. Youngstown (OH) Vindicator, Editorial. “Sometimes, the only thing to do is smile. And so it is today, in the wake of Monday’s announcement that V&M Star Steel will start next month on a $650 million pipe mill in Youngstown. There is no way to put a bad face on this news. In the short term, it will mean hundreds of jobs in the construction trades. That alone will provide a boost in the local economy. It will provide a shot in the arm for Youngstown’s income tax receipts — not enough to justify any spending spree, but a welcome departure from shrinking receipts. … And after the roads and rail lines are built, the building is erected, the heavy equipment and computers installed, the facility will provide new, well paying jobs to 350 people. … And as much as everyone talks about new, green sources of power, we’ll be running on fossil fuels for some time to come.

Steel Is Back. WYTV-TV (OH). “We are ideally situated to serve the Marcellus Shale,” said V&M Star President Roger Lindgren.  What Lindgren is referring to is a vast underground layer of rock shale that underlays Eastern Ohio, across the Finger Lakes region of New York, under western Pennsylvania, south to West Virginia and even into Virginia. It measures from a few feet to 900 feet thick. The shale and other layers above and below together form an impervious cap to an enormous reservoir of natural gas trapped in huge pockets. It is the economic potential of tapping that store of energy that made the Youngstown-Girard site the best candidate for the $650 million investment of a new rolling mill.

Arlington considers new fees on Barnett Shale drilling. Fort Worth Star-Telegram. “The city is considering tougher requirements for natural gas drillers, including increased road damage fees, new wastewater disposal fees, higher penalties for noise violations and limits on the time they have to drill on a site after obtaining a specific-use permit. City officials said the proposed changes would help Arlington recoup some of the costs related to the increasing natural gas drilling and pipeline construction and put more protections in place for property owners near drilling sites.

Water withdrawal site for Marcellus shale drilling is proposed for Terry Twp. Towanda (PA) Daily Review. “Talisman Energy USA is proposing to construct a site near Wyalusing where up to eight tanker trucks at a time would be filled with water from the Susquehanna River for hydraulic fracturing to develop natural gas wells. The site would have eight hydrants, said Robert Furman, the project designer for Larson Design Group in Williamsport. The site would be located on the Charles Welles property in Terry Township, near the western end of the Rainbow Bridge, said Ray Stolinas, Bradford County planning director. The bridge carries state Route 2010 over the Susquehanna River.

Opponents use fear, false claims and junk science. Syracuse (NY) Post-Standard, LTE. “Facts are not hearsay, facts are not a blog; facts come from truth, a truth known by actual experience or observation. The social and economic decisions for natural gas were made long ago since New York has been developing natural gas for over 180 years. It’s not new folks; you just haven’t paid attention because there have been no serious problems. Natural gas has been developed responsibly and with protection of the environment. Check your facts. There’s a new reality show coming to New York soon if the anti-drilling people have their way: “Biggest Loser: You.”

League presents shale series. Wilkes Barre (PA) Times-Leader. “On Feb. 19, the League of Women Voters of Susquehanna County will begin a three-week series about Marcellus Shale drilling at Elk Lake Jr.-Sr. High School in Dimock. … On Feb. 26, the League will host “Marcellus Shale: Water Quality Issues,” which will include two environmental consultants: Jerry Washo of Resource Environment Management Inc. and Jim Llewelyn of Appalachia Hydrogeologic & Environmental Consulting. Also in attendance will be Sharon Lynett, a field representative from Sen. Bob Casey’s office, who will discuss the Fracturing Responsibility and Awareness of Chemicals Act. The FRAC Act, as the bill has become known, will require natural gas companies to reveal the chemicals used during the hydraulic fracturing process.

ConocoPhillips, BP and Caterpillar quit USCAP. Washington Post. “ConocoPhillips, BP and Caterpillar have dropped out of the U.S. Climate Action Partnership (USCAP), the coalition of corporations and environmental groups that has been most prominent in pushing Congress to pass cap-and-trade legislation. …The oil giants also want to do more to promote natural gas, which has become more abundant because of recent developments in the exploitation of shale gas and emits half as much greenhouse gas as coal does. The legislation adopted by the House included benefits for coal producers and coal-fired power plants in an effort to secure the votes of key lawmakers. Many natural gas producers think that more should be done for them.

Gas, water drilling shouldn’t mix. Lebanon (PA) Daily News, LTE. “Should the state Department of Environmental Protection be monitoring the drillers? Yes, and they probably do more monitoring than the environmentalists think. Are there dangers? Yes, but these dangers can be minimized with proper techniques. Will the big drill rigs and some of the water losses be permanent? No. Smaller pumps and pipelines will replace the rigs. When drilling is completed, the water usage will stop. Should we be alarmed by all the claims of doom and gloom in these recent letters? No. Big business is not the only industry that lies. … Whatever the opponents of gas drilling say, take it with a grain of salt, or in this case, stone dust.

Energy Company Mergers Are Expected to Rise. New York Times. “Buying interest is particularly strong among the international oil majors, which had sold off many of their onshore assets in the United States over the last decade and are now eager to come back. Anthony B. Hayward, the chief executive of BP, said last month at the World Economic Forum in Davos, Switzerland, that the gas being extracted from beds of shale was “a complete game-changer. It probably transforms the U.S. energy outlook for the next 100 years.”

Seven Questions for the Mayor of DISH

In advance of Mayor Tillman’s trip to New York next week, EID poses a series of questions residents should ask while he’s there

It’s not every day you’re likely to run into the mayor of a small town in Denton Co., Texas ambling about the Southern Tier of New York State. But next week, that’s precisely where you’ll find DISH mayor Calvin Tillman – slated to make the nearly 1,500-mile trip to the Empire State to rally local environmental activists against efforts to explore for natural gas in the Marcellus Shale.

Now, wait a second: Isn’t this the same Marcellus Shale that studies suggest could create 16,000 high-wage jobs in Broome Co., N. Y. alone — and generate $15.3 billion in local economic development? Yep, that’s the one. Turns out, though, that the mayor of DISH isn’t as sanguine on shale gas as you’d expect. And to help him punctuate his case, he’ll be bringing to New York a couple of recent “studies” on the subject aimed at scaring local residents into believing that natural gas exploration will ruin their air, sully their land, and poison their water. Should be quite the show.

Of course, we can’t say for certain whether the mayor will mention to local residents that these studies have been almost universally panned by independent environmental engineers; that they were recently debunked by the Texas Commission on Environmental Quality (TCEQ) itself; or that the contractor who did the study for Mayor Tillman doesn’t have a licensed professional engineer on its staff.

And who knows? He may forget to mention his relationship with the Oil & Gas Accountability Project (OGAP), an anti-energy group based in Colorado (but active in New York) which considers clean-burning natural gas a “filthy” form of energy. He may not find it relevant to mention that OGAP funded one of the studies he plans to show off – or that his town’s official government website links to OGAP’s page on the internet. Who can say for sure?

Thankfully, in the off-chance the mayor forgets to mention any of these details to the audiences he plans to visit – or that reporters forget to ask – Energy In Depth has assembled the following list of questions that Mayor Tillman might like to answer during his stay in New York:

1)     Mr. Mayor, your assertion that local natural gas exploration activities have adversely impacted the air quality of your town appears to be entirely founded on a study you commissioned by a group called Wolf Eagle Environmental. Are you aware that TCEQ conducted an internal review of this study and found that “it is not possible” to draw the types of conclusions that appear in that report?

2)     Mr. Mayor, are you aware that Wolf Eagle Environmental was formerly known as Wolf Eagle Environmental Engineers & Consultants – but was forced to change its name upon it becoming public that the organization did not (and, in fact, still does not) employ an actual licensed professional engineer on staff?

3)     Mr. Mayor, is it true that once the Wolf Eagle evaluation was debunked, you accepted an offer from the national Oil & Gas Accountability Project (OGAP) to fund a second study of a similar type? Is it true that OGAP links are found on your town website? Are you aware that OGAP considers clean-burning natural gas a “filthy” energy source, and was in fact established as a means to fight natural gas exploration wherever, whenever and however it takes place?

4)     Mr. Mayor, have you had the chance to take a look at TCEQ’s recent air quality study of the areas in and around the Barnett Shale? If so, did you note that of the 94 sites tested by TCEQ, 92 registered short-term effects screening levels (ESL) well below anything that would cause “alarm,” according to TCEQ’s toxicology director? Are you also aware that repairs at the remaining two sites tested by TCEQ have already been completed by industry and certified by the agency?

5)     Mr. Mayor, you testified on numerous occasions that energy operators in your area are responsible for the emission of benzene and other potential contaminants into the air. But did you know that the mere act of filling up your tank with a conventional gas pump (one without a vapor recovery device) could expose you to benzene levels of 11,000 parts per billion (ppb), according to TCEQ — without any ambient air to dilute it? Are you aware that not even the Wolf Eagle study was able to find a single site in your area exceeding 78 ppb?

6)     Mr. Mayor, are you aware that according to EPA, “oil and natural gas production contributes only 2% of the total benzene emissions in the U.S., and shale gas represents a very small subset of this 2%”?

7)     Mr. Mayor, did you know that energy exploration is responsible for employing more than 200,000 people in your state? Accounts for the payment of more than $44 million in royalties and rents to landowners every year? And sends more than $4 billion each year to your treasury, representing nearly seven percent of your entire budget? Here in Upstate New York, we aren’t trying to be the next Texas – but can you understand how the availability of even a fraction of these new resources could help revive and strengthen our economy?

With that, we welcome the mayor to the Empire State – the only place in the world that can lay claim to (among so many other things) two Ivy League universities, Woody Allen, and the first-ever commercial gas well (Fredonia, 1829). Our hope is that he thoroughly enjoys his stay. And our expectation is that he’s ready, willing and able to render honest answers to the legitimate questions posed above.

Additional resources available at Energy In Depth:

• Study: Potential Economic and Fiscal Impacts from Natural Gas Production in Broome County, NY
• Analysis: Lies, Damned Lies, and Walter Hang’s Statistics
• Issue Alert: Gangs of New York
• Issue Alert: Sign of the Times
• Fact Sheet: HF Opponents Say the Darndest Things
• Graphic: What’s In Frac Fluids?
• Browner Memo: Letter of Support for Hydraulic Fracturing from Carol Browner, Fmr. EPA Administrator

Energy In Depth: Today’s News

** Click HERE to watch PA state Rep. Jim Christiana discuss hydraulic fracturing and the FRAC Act.

The Huge Ramifications of Natural Gas Drilling Technology. Seeking Alpha. “With the massive production of shale gas in Texas, Louisiana, and Arkansas, the US will not be needing LNG imports any time soon; as a result, the US has supplanted Russia as the world’s largest gas producer. Indeed, the US may become an LNG exporter. The technology for accessing shale gas may also open up previously unreachable supplies outside the United States, some of which should be able to reach consumption markets by pipelines, and some in the form of LNG. … The development of new unconventional gas supplies should also be a serious crimp in any plans for a gas OPEC.

Gas Drilling Creates Hiring Boom. WBNG-TV (NY). “Natural gas companies exploring the Marcellus Shale in Pennsylvania need more manpower. And the industry is tapping into the New York workforce to find employees. As Action News Reporter Caitlin Nuclo tells us, 400 people could be launching a new career. Steve Mosher has been out of work since September. He was a tractor trailer driver, but when his job moved, he didn’t follow. Now, he’s looking for a new career path. “The gas drilling is a great opportunity for employment in this area.” … “It’s very important to secure a domestic energy production source and I think these will be good paying jobs,” said Mosher.

Russian energy giant Gazprom: shale gas is really, really, really rubbish. UK Telegraph. “The world’s largest gas producer is not going to be pleased that a new, abundant form of supply has been discovered in America. Shale drilling – the unconventional technique of fracturing rock to extract gas – has the potential to meet a large amount of US needs over the coming years. And this has come at a time when Gazprom was planning to develop an extremely expensive, remote and icy field in the Baltic called Shtokman specifically to supply the US.

Campaigning for gas drilling. Elmira (NY) Star-Gazette, LTE. “First I want to thank Terry Wheet for his letter on gas drilling on Jan. 30, “Gas drilling important.” I want to add that if Gov. David Paterson was to lift the ban soon on drilling in the Marcellus Shale, he will have my vote, and I’ll even campaign for him.

More state forestland up for gas leases. Philadelphia Inquirer. “In a move applauded by conservationists, Gov. Rendell on Tuesday trumpeted plans to enact a wellhead tax on Marcellus Shale natural gas that would generate $160.7 million next year and potentially billions more in the coming years. But the governor’s office did not draw attention to another Marcellus Shale revenue source he is counting on. Buried on the 1,005th page of his proposed budget is a line item indicating the state expects to earn $180 million by leasing more state forestland for gas development.

Revived interest in natural gas drilling prompts to W.Va. lawmakers to consider new safeguards. Associated Press. “Much of it comes from hydraulic fracturing, or “fracking.” Millions of gallons of water, sand and chemicals are blasted into a well to fracture tightly compacted rock and release trapped natural gas. The water that returns to the surface can be five times saltier than seawater and laden with dissolved solids. Fracking has been applied to tap the massive Marcellus Shale, potentially the country’s most productive natural gas source. It stretches deep underground beneath several northeastern and Appalachian states, including nearly all of West Virginia.

Nova signs partnership deal for Marcellus Shale pipeline. Pittsburgh Post-Gazette. “Nova Chemicals Corp. could supply one of its Canadian plants with natural gas from Marcellus Shale deposits in Western Pennsylvania through a proposed pipeline venture. … Marcellus Shale is a geological rock formation found in an area that stretches from West Virginia and eastern Ohio, through Pennsylvania, western Maryland and western New York into Ontario. Energy experts believe that the gas found in the shale holds widespread potential as a future source of fuel and could provide significant revenues to companies who drill for it and the local economies where it is captured.

Alpha Natural Resources becomes latest player in Marcellus shale. Washington (PA) Observer Reporter. “Coal mine operator Alpha Natural Resources has expanded its tiny natural gas business, drilling its first well in the Marcellus shale. The company announced a joint venture this week with driller Rice Energy, which is headquartered in Southpointe. The companies are investing a combined $20 million in four wells this year and could drill as many as 100 in the Marcellus, a rock bed the size of Greece that lies about 6,000 feet beneath New York, Pennsylvania, West Virginia and Ohio.

DEP approves gas drilling wastewater treatment permit. Williamsport (PA) Sun-Gazette. “The state Department of Environmental Protection Thursday issued a permit allowing a local company to treat and discharge 400,000 gallons per day of gas well wastewater into the West Branch of the Susquehanna River. The agency issued the permit, the first of its kind in the West Branch watershed, to TerrAqua Resource Management LLC, a subsidiary of Larson Design Group. The company requested the permit to build a gas drilling wastewater treatment operation at Water Tower Square in Williamsport.

Energy In Depth: Today’s News

** Natural gas was featured on Jeopardy this week. Click HERE to watch.

Obama’s energy policy could use a dose of reality. Fort Worth Star-Telegram, Prof. Weinstein. “Hiking taxes on domestic energy companies could also derail the shale gas revolution under way in many parts of the nation. A decade ago, the conventional wisdom had it that natural gas production was on a permanent decline. But thanks to new drilling technologies, the U.S. Energy Department estimates we have at least 90 years of proven and potential reserves from shale formations in Texas, Louisiana, West Virginia, Pennsylvania, New York and other states. This clean domestic resource can be used for power generation, home heating, transportation and petrochemicals while reducing our dependence on imported oil. What’s more, the exploration, production, processing, transmission and delivery of shale gas can support tens of thousands of new, sustainable American jobs.

Mansfield gets more than $80000 in lease sale. Shreveport Times. “The city of Mansfield gained more than $80,000 in bonus payments when it leased mineral rights on almost six acres during today’s monthly lease sale in Baton Rouge. Mansfield Mayor Curtis McCoy attended the lease sale meeting, and said the Haynesville Shale is a great boost for the economy and local government throughout the area. “We appreciate the work that the Mineral and Energy Board, the staff of the state Office of Mineral Resources and the Department of Natural Resources have done in helping us to make the most of our opportunities with the Haynesville Shale activity,” McCoy said in a prepared statement.

State brings in $6.3 million on mineral sale. Associated Press. “The natural gas hotbed of the Haynesville Shale dominated February’s sale of state leases by the Louisiana Mineral and Energy Board. Wednesday’s sale brought in about $6.3 million, bringing the total for the current state fiscal year to $45.2 million. Of the 13 leases sold, 10 were in the area of the Haynesville Shale formation in northern Louisiana, considered 1 of the largest domestic gas finds in years.

Safe drilling good for NY. Ithaca (NY) Journal, LTE. “I have become increasingly frustrated by those opposed to the possibility of increased exploration in this region. While natural gas exploration has been conducted safely in New York for decades, the public has been misinformed repeatedly by obstructionists whose agenda is to delay new investments in the Marcellus Shale. … we can explore for natural gas safely, while protecting the environment. New York’s oil and gas producers have operated in a safe and environmentally sound way for decades. There are more than 14,000 active wells around our state. Regardless of what the obstructionist groups allege, not a single documented case of drinking water contamination has ever been tied to hydraulic fracturing in New York.

University Creates Hydrofracking Committee. Cornell Daily Sun. “The University announced yesterday evening that they have established an ad-hoc advisory committee to examine the issue of hydrofracking in the Marcellus Shale region of land. The “Ad Hoc Advisory Committee on Leasing of Land for Exploration and Drilling for Natural Gas in the Marcellus Shale”–– which is comprised of six faculty members, four staff and one graduate student that have expertise in relevant and related academic fields –– will have until the end of the semester to develop a set of guidelines that will advise President Skorton on how to approach the decision of whether to lease university-owned land for natural gas drilling.

Water Won’t Be An Issue. Wheeling (WV) Intelligencer. “Stacey Brodak, manager of corporate development for the Appalachian division’s parent company, Chesapeake Energy, said her organization plans to protect the environment when drilling into the Marcellus Shale below Oglebay to release the natural gas. “Chesapeake Energy complies with all regulations as set forth by the West Virginia Department of Environmental Protection. Additionally, we aggressively implement best practices to reduce the possibility of leaks, spills and discharges,” she said via e-mail. The briny water comes from a drilling technique known as hydraulic fracturing, or “fracking,” in which millions of gallons of water, sand and chemicals are blasted into each well to break up the tightly compacted shale. Upon fracturing the rock, some of the water – 15 percent to 40 percent – comes back up through the well.

South Jersey Gas’ parent company expects huge profits from Pennsylvania gas fields. Atlantic City Press. “Natural gas,” said Edward J. Graham, president and CEO of South Jersey Industries, “is the answer for the future.” So confident is Graham in the necessity of natural gas that he has taken Folsom-based SJI, the holding company of South Jersey Gas, into a different direction: drilling and production. And if the venture proves successful,  the region’s largest public company stands to collect millions of dollars in revenue, analysts say, potentially “dwarfing” its other operations. In December 2008, SJI told investors that its subsidiary was spending $2 million for a minority interest in the mineral rights of 21,000 acres in western Pennsylvania. The area — known as Potato Creek — is part of the Marcellus Shale.

Seminar helps businesses prepare for gas drilling. News 10 Now (NY). “Natural gas drilling in Marcellus shale is expected to have a big impact on New York State and businesses in Chemung County want to be prepared.

Waiting for Drilling to Start. WBGH-TV (NY). “Lasky believes drilling can and will be done safely. … But, he says after studying the issue extensively the positives outweigh potential negatives. Richard says, “What they don’t take into account is that human beings are part of the environment. I love animals and it’s wonderful to save them, but there are people here who are starving, who can’t pay the bills, they’re losing their jobs, farms, there’s nothing they can do, prices are going up, they’re on a fixed income. They’re beginning to lose everything. That part of the environment has a chance to be fixed and if that part if fixed the rest will follow.”

February is the cruelest month. Albany Times Union. “On Thursday we will head southwest to a small community called Indiana PA. It is, incidentally, the hometown of Jimmy Stewart, and the self-proclaimed Christmas Tree Capital of the World. Indiana is the county seat of Indiana County, just a few miles from the West Virginia border and smack in the heart of the Marcellus Shale. Like much of western PA, Indiana has seen vertical gas drilling for a couple of decades, ever since the coal industry went belly up. If you head over to the Eat ‘n Park for some homemade red devil’s food cake and a Rolling Rock (don’t knock it ’til you try it), you’ll pass any number of gas drilling wells, and many of them are the kind we’ll be seeing here in New York if the hydrofracturing gets underway.

EOG Resources CEO: Haynesville, Bossier To Boost 2010 Gas Output. Wall Street Journal. “EOG Resources Inc.’s (EOG) chief executive Mark Papa said Wednesday that the Haynesville and Bossier Shale will boost the company’s North American natural gas production growth in 2010. … “This area will be the largest single driver,” of our North American gas growth, Papa said during a conference call with investors. Energy companies like EOG Resources have learned to unlock new supplies of the fuel from dense rock formations. Shales — such as the Haynesville in Louisiana, the Barnett in Texas and the Fayetteville in Arkansas — are credited with creating a boom in domestic gas output.

Rice Energy, Alpha Natural Resources form joint venture. Pittsburgh Business Times. “Alpha Natural Resources Inc., Abingdon, Va.-based coal producer, has formed a 50-50 joint venture with Rice Energy LP, Pittsburgh-based exploration and production company, to develop Marcellus Shale gas resources. Alpha (NYSE:ANR) controls nearly 20,000 acres near Pittsburgh. The joint venture was announced Tuesday in Alpha’s quarterly earnings release but was worked out last week. Alpha and Rice each contributed cash and certain mineral and property interests to a newly formed partnership that will own and develop the assets. Exact figures were not disclosed. A limited liability company was also formed to be the managing general partner of the partnership.

Energy Transfer Partners To Buy Haynesville Shale Assets. Wall Street Journal. “Energy Transfer Partners LP (ETP) said Wednesday it has agreed to buy natural-gas gathering and treating assets in Louisiana’s Haynesville Shale from Tristate Midstream LP, a company owned by Dallas private equity firm Energy Spectrum. The deal is the latest in a string of asset acquisitions related to shale-rock formations. Gas extracted from these reservoirs has driven a boom in domestic U.S. gas supplies over the past few years. In December, Exxon Mobil Corp. (XOM) agreed to acquire shale-gas producer XTO Energy Inc. (XTO) for $31 billion.

Energy property expo focuses on the long view. Houston Chronicle. “NAPE presenters on Wednesday had plenty of ideas on where oil and gas companies might spend their money in coming years. They talked about successes in frontier regions and in nontraditional resource plays, and called on the industry to employ unconventional thinking to squeeze new reserves from mature basins. “You’re going to see a lot of shale,” Frank Patterson, vice president of international exploration at The Woodlands-based Anadarko Petroleum, told attendees, referring to much-touted dense rock formations where huge natural gas finds have recently been made in North America.

Plan to suspend new drilling in Barnett Shale becomes campaign topic. Fort Worth Star-Telegram. “The energy-rich Barnett Shale is becoming enmeshed in election-year politics as the leading Democratic candidates for governor take opposing directions over a proposed moratorium on new permits for natural gas production amid concerns about benzene emissions. Former Houston Mayor Bill White, the presumed front-runner in the Democratic primary race, says he opposes a broad-based moratorium on new drilling permits — as advocated by state Rep. Lon Burnam, D-Fort Worth — while at the same time calling for tough action against individual producers who violate pollution-control standards.

The Final Countdown

Should state officials remain in charge of regulating fracturing activity in their communities? Yes. And EID counts the reasons why

Support for the safe development of clean-burning natural gas has always been a bipartisan affair. But to listen to Democratic Rep. Mike Doyle (Pa.) extol the virtues of modern-day shale gas exploration at a hearing in Congress last week, one was left to wonder how anyone, of any party, of any sensibility, could possibly oppose it.

Remember, Rep. Doyle still apparently supports the ill-advised windfall profits tax; he’s hardly a shill for the oil and natural gas industry. But the congressman can’t ignore the potential – heck, the reality – for shale gas to create jobs, revenue and opportunity for the residents of Pennsylvania. Just take a look at key segments of his excellent opening statement:

“We have had enormous success in my State of Pennsylvania with horizontal drilling in natural gas shale plays.”

“My State, Pennsylvania, has done a great job in regulating the natural gas industry, while allowing it to grow and prosper.”

“We have been known as a steel city, but pretty soon we may be known as the Saudi Arabia of natural gas with the Marcellus shale sitting underneath western Pennsylvania.”

“Last year alone Pennsylvania could attribute nearly 50,000 jobs to environmentally safe natural gas production.”

All that’s true, by the way – according to Penn State University, “in excess” of 48,000 jobs were created in the state in 2009 alone (and nearly $4 billion in economic activity) all thanks to a technology that allows producers to access and recover resources that would be too deep and difficult to otherwise get. Congressman Doyle certainly read the Penn State study, and it’s clear he knows a thing or two about the safeguards in place to ensure the critical work of developing these job-creating shale resources doesn’t come at the expense of our air, water or surrounding environment.

But that’s not to say that Rep. Doyle claims to know it all; as he made clear during last week’s hearing, he’s still got plenty of questions on the design, intent and potential impact of the FRAC Act on his district. Fortunately for Rep. Doyle, the bill’s lead sponsor – Rep. Diana DeGette (D-Colo.) — sat only a few seats away from him at last Wednesday’s hearing, eager to explain the functions of her bill to a subcommittee of which she isn’t even a member. Unfortunately for Rep. Doyle, Rep. DeGette’s characterization of her bill was, in the final analysis, so irreconcilably divorced from reality that it’s tough to imagine how anyone could have left the room with more or better information on the legislation than when he came in.

Which is too bad, really – because Rep. Doyle came to this hearing with a series of important questions on the FRAC Act, for which he expected answers. Here, according to the hearing transcript, is how Rep. Doyle set up his line of questioning: 

Statement #1: In Pennsylvania, officials have “done a great job in regulating” Marcellus Shale exploration in the state;

Statement #2: In Pennsylvania, “we have rules in place to protect our underground sources of drinking water”;

Statement #3: In Pennsylvania, “in order to obtain a permit, drillers must identify any anticipated impacts of water withdrawals on water resources.”

Statement #4: In Pennsylvania, the “law requires drillers to case in grout wells through all freshwater aquifers before drilling through deeper zones in order to protect ground water from pollutants inside wells”;

Statement #5: In Pennsylvania, “there are also rules that require operators to disclose all chemicals to be stored and used at a drilling site, including chemicals and fracking fluids in order to guard against contamination and ensure safe disposal of these chemicals. That is Pennsylvania law.”

And Now His Question: Having established that Pennsylvania’s laws 1) are tough, 2) work well, and 3) haven’t forced producers to leave the state – what would be wrong with imposing a “national regulatory framework” based on the Pennsylvania model to create “uniformity and predictability” for those who operate in multiple states?

Why not back a national standard? And while we’re at it, why not back the FRAC Act – since all it’s trying to do is put a uniform rule in place? Reasonable questions, to be sure. Thankfully, they’re questions for which there are similarly reasonable and straightforward answers. Energy In Depth counts the ways:

1)     Fractured Thinking on the FRAC Act. Those who say the FRAC Act will setup a straightforward, uniform standard for the regulation of hydraulic fracturing nationwide are simply not telling you the truth. In reality, and made clear by the actual text of the bill, the FRAC Act has only one single purpose in mind: prevent the development of America’s shale gas by establishing a de facto ban on the technology needed to produce it. Mechanically, the means by which the bill seeks to do that are genius: It doesn’t actually ban fracturing from taking place in explicit terms, it simply mandates that no fracturing activity can proceed until EPA issues the appropriate permits/approval under the Safe Drinking Water Act – something EPA literally cannot do under the current structure of SDWA.

2)     The Fallacy of the Slacker State. One of the central justifications for imposing an EPA-driven, one-size-fits-all regulatory regime on hydraulic fracturing is that some states, to put it plainly, just aren’t doing their job. Observe here (page 80 of the PDF) how Rep. Doyle puts forward the proposition at the hearing:

“So my question is, because this Marcellus shale formation goes over several States and we have some laws that have regulations ?? some States that have regulations, some States that have no regulations and everything in between, would a national regulatory framework … create uniformity and predictability for a company like yours?

Here are the facts: Of the 27 states that support 99.9 percent of all oil and gas exploration activities nationwide, all 27 have permitting requirements in place, right now, governing the siting, drilling, completion and operation of wells – which include operations related to hydraulic fracturing. Some of these states have had experience in regulating this process for more than 100 years. You can find a fact sheet on our website capturing all the relevant rules, regulations and data in the individual states.

3)     Shale Plays are Like Snowflakes. No two are alike. Plainly put, the subsurface geology of Pennsylvania is dramatically different from the composition of underground strata in Texas. New York is different from West Virginia. Colorado is different from Kansas. Each state presents unique challenges to producers operating in that region – from the depth of the shale play, the volume of resources attached, to the temperature of rock below, to the availability of injection wells as an option for disposal. No two states – not even any two regions – will require the same exact fracturing treatment, and therefore no two states should be forced to live under the exact same regulatory system for bringing these resources to market. Regulators on the ground, in the community, know this terrain – physical and regulatory – better than anyone sitting at a desk in Washington, D.C.

4)     EPA is Simply Ill-Equipped to Do the Job. Every month, more than 35,000 separate wells in 27 states undergo fracture stimulation work, and nine out 10 wells in America will require this technology to yield additional energy in the future. The idea that EPA staff – the majority of whom work out of offices in Washington, D.C. – would have the ability to properly oversee this system, and issue permits pursuant to it, is ridiculous. Even Carol Browner, the president’s current energy and environment czar, admitted that in a letter she wrote while serving as administrator of EPA. And, not for nothing, but doesn’t EPA already have enough on its plate these days without injecting itself in process the state’s have managed well for decades?

5)     The Current System Works – and History Bears That Out. To accept the argument that EPA regulation of hydraulic fracturing is necessary, first you need to accept the premise that the current system of state-based regulation is broken. But the facts simply don’t bear that proposition out. From North Dakota to Texas, Montana to New Mexico, Colorado to Pennsylvania, Tennessee to Alaska – every one of these states has testified that fracturing activities pose no discernable threat to local drinking water. And as we’ve written before, there’s a darn good reason for why that’s the case: The areas we frac are isolated from the areas the house drinking water by thousands of feet in distance and millions of tons of impermeable rock. And on the surface, when a rare spill or incident does occur, state regulators – to a man – have testified that they’ve got all the authority they need to prosecute the offending parties, and ensure those incidents do not occur in the future.

Now are you starting to get the picture here? Truth is, energy producers encourage commonsense regulations. Fortunately, under the present system, operators have the ability in most states (New York, we’re looking at you) to produce these abundant shale gas resources in a way that’s both economical for their businesses, and safe for the surrounding communities in which they work. Those are the facts – and at a time of record unemployment and winnowing state revenues, those are the realities that policy-makers should consider before walking into the buzz saw known as the FRAC Act.

Energy In Depth: Today’s News

Gazprom frets about surge in US gas production: report. AFP. “The state-controlled firm is reconsidering its strategy in light of the US “revolution” in shale gas extraction, Kommersant said, citing a company document due to be presented at a board meeting on Tuesday. “The situation is aggravated by the so-called revolution in gas extraction from nontraditional sources in the United States,” said the document, a speech by Gazprom deputy chairman Alexander Medvedev, quoted by Kommersant. “If several years ago not a single organisation known to us was forecasting the rapid growth of gas extraction in the United States, today practically all companies are discussing the prospects of shale gas extraction, which could fundamentally reshape the whole world gas market.”

Gas drilling rallies pit environmentalists against pro-growth advocates. Democrat and Chronicle (NY)/Press & Sun-Bulletin. “Robert Moore, a resident of Port Crane, Broome County, said New York is “running people out of the state” because of high taxes. Natural gas exploration using horizontal wells and a process called hydraulic fracturing, or “fracking”, is safe and the economic development benefit would be great, he said. “The jobs would be astronomical,” said Moore, 49, adding, “Without it, we’re done.” … Randall Slimak of Horseheads, Chemung County, held a sign that said “My land. My gas.” as he waited in the pouring rain in Lafayette Park, near the Capitol, for the pro-drilling rally to begin. … he and other landowners think of themselves as the original conservationists. The DEC’s drilling rules are the most restrictive of any state, he said. “I support natural gas exploration. It’s a source of jobs and revenue,” he said.”

Exxon-Xto Deal Forces Congress to Reconsider Natural Gas. New York Times. “Natural gas is the cleanest of the fossil fuels, and electric utilities that burn it to generate electricity belch out half the amount of carbon dioxide emissions they produce when when they burn coal. Exxon’s decision in December to purchase Fort Worth, Texas-based XTO Energy, one of the nation’s largest gas producers, could mark a dramatic shift in the way Washington understands domestic energy supply. It also underscores the role that gas is likely to play in cutting industrial emissions, in the United States and in fast-growing developing countries such as China and India.”

Area gas-drilling supporters, opponents rally in Albany. Daily Star (NY). “The weather was horrible,” said Marie Lusins of Oneonta, a member of the Unatego Area Landowners Association. Still, Lusins said the landowners were cheered by good speeches delivered by political allies, including state Sen. Thomas Libous, R-Binghamton, and state Assemblyman Clifford Crouch, R-Guilford. ‘They were tremendous and right on target: It’s time to let the DEC get on with this,’ Lusins said, referring to the approval of its draft Supplemental Generic Environmental Impact Statement. … Now, with horizontal drilling and hydraulic fracturing – called “fracking” – the gas boom is poised to come here if allowed by state regulators. … Lusins, a former Oneonta town councilwoman, said people who don’t want drilling don’t have the facts on how safe it is. ‘There never has been one instance in New York of fracking fluid contaminating someone’s water,’ she said.”

North Dakota Raises Oil Forecast on Advances by Shale Explorers. Bloomberg. “North Dakota raised its forecast for oil output on growth in and around the Bakken Shale formation, portending further gains nationwide after the largest U.S. increase since Dwight D. Eisenhower’s first term as president. Output may reach 300,000 to 400,000 barrels a day by mid- 2011 and stay at that level for 10 to 15 years, said Lynn Helms, director of the North Dakota Mineral Resources Department. The state’s previous estimate was 220,000 to 280,000. … “The sort of technology improvements you as a consumer see in the iPod are also happening in the oil and gas industry to help production,” said Nansen Saleri. … Oil companies use horizontal drilling to expose rock and fracture it, allowing crude to flow. The U.S. Geological Survey estimates the formation to hold as much as 4.3 billion barrels of recoverable oil in North Dakota and Montana.”

Protesters fight for their cause (and against the elements). Albany (NY) Times-Union. “The pro-drilling rally, organized by the Independent Oil and Gas Association, was safeguarded from the powerful winds and featured a 15-foot by 20-foot tent for the speakers and a number of the supporters. The majority of the pro-drilling crowd was made up of struggling farmers dressed in jeans and work boots, who claimed that drilling for natural gas in the Marcellus Shale would provide thousands of jobs for the struggling economy. “If they don’t pass this law hundreds of thousands of jobs will be lost to Pennsylvania,” Steven Palamatier, a landowner from Norwich who has a 4,800 foot well on his property, said.”

Drilling naysayer no more. Press & Bulletin (NY), Op-Ed. “Opponents of drilling (for which read “progress”) and the right of honest landowners to get enough cash out of their impoverished farmlands to pay for a move to Florida or some other Sunbelt oasis, have been quick to blame “fracking” the process of blasting through the shale encapsulating the gas, thus freeing it. … They carry on about trees and foliage and rivers and trout streams being threatened, but I would point out that Pennsylvania’s got just as many trees as New York, maybe more, and its trout streams are good as ours, maybe better. But the point is that three counties in northern Pennsylvania alone have got nearly a hundred gas wells operating, and we’ve got none, nada, zippo right here in Broome County. … Take a look at the buildings and trucks in that photo I mentioned. What colors do you see? Red, white and blue. Those are America’s colors, my friends, and those drilling sites are America’s future.”

Listen to WAMC/Times Union hydrofracking debate. Albany (NY) Times-Union. “Click here for audio of this morning’s WAMC/Times Union debate on some of the issues surrounding the natural gas drilling technique known as hydrofracking. The state Department of Environmental Conservation is currently formulating a final draft of regulations for the use of hydrofracking in the extraction of vast quantities of natural gas from the Marcellus shale in south-central New York.”

Gas drilling debate hits Albany. Observer-Dispatch (NY). “Those who support the [fracturing] process said that developing natural gas would create jobs and safely generate millions for the state. Many of them identified themselves as landowners who want to sell their development rights to drilling companies. Joe Axtell of Deposit, located east of Binghamton said a number of dairy farmers in his area would like to sell their development rights. “In our area, there used to be tons of dairy farmers,” Axtell said. “Now, they can’t pay their taxes, and you can count the number of farms on one hand. This would help them, help the state.” … Lowry, like most who support the practice, argued that “fracking” has never been credibly tied to water pollution. … “It’s about rights being taken away – rights of the people,” Lowry said. “These people – the landowners – stand to gain something from this, and environmentalists are trying to take away these people’s rights.”

Anti-drilling critics misguided. Elmira (NY) Star-Gazette, LTE. “In response to the Dec. 30 letter about gas drilling, I would encourage the writer and the other anti-drillers to do some research in lieu of hysteria and hearsay. After my Internet search, I have concluded that most, if not all, problems related to water contamination were corrected. In nearby Millerton, Pa., there is natural gas present in some water wells. This condition has been present for at least 50 years and is not the result of gas drilling contamination. … Drilling prospects are significantly better in western New York and thus gas drilling companies are concentrating their efforts where they are most likely to succeed. In my opinion, those opposed to drilling took way too much credit for what was a good business decision by drilling interests.”

Riches from natural gas industry are fueling acquisition of the Texas Rangers. Ft. Worth Star-Telegram. “The Rangers Baseball Express, racing full speed ahead for home plate, is being fueled by natural gas. The Express, the investment group poised to become the new owners of the Texas Rangers, is apparently drawing a significant chunk of its bankroll for the $500-million-plus acquisition from Bob Simpson of Fort Worth and Ray C. Davis of Dallas. Both have made their fortunes from natural gas and benefited from the riches of North Texas’ Barnett Shale, perhaps the hottest gas drilling play in the nation over the past several years. … Simpson co-founded XTO, originally known as Cross Timbers Oil Co., and stepped down as CEO in late 2008. Exxon is acquiring XTO primarily because of its expertise in “unconventional” shale plays such as the Barnett, which has about 14,000 producing wells thanks to advances in horizontal drilling and hydraulic fracturing.”

Anti-drilling coverage. Press & Bulletin (NY), LTE. “It’s interesting how the Press & Sun-Bulletin consistently chooses to promote the most negative aspects of the proposed gas drilling in our area. Very little is printed about the possible immediate and long-term benefits to our community. I am wondering what the spin will be if we lose the only possible economic boost this area may experience for many years.”

Both sides in gas-drilling dispute rally in Albany. Times Herald-Record (NY). “Douglas Lee of Livingston Manor, who works with computers, agrees that extracting gas with the controversial horizontal drilling method called “fracking” would be life-changing. But he thinks it could turn poor Sullivan around. “It would be the biggest thing, bigger than casinos,” he said. “The jobs and money could solve economic problems.” … Assemblyman William Parment, D-North Harmony, pointing to scores of wells in his western New York district — on golf courses, school grounds, even in Jamestown’s aquifers. “It’s proven and safe,” he said to a crowd of landowners, like Long Eddy’s Noel Van Swol and Bethel’s Al Larson, who head leasing groups. “Extremists,” is what state Sen. Tom Libous, R-Binghamton, called opponents.”

New York protesters divided over natural gas drilling. Syracuse (NY) Post-Standard. “Others at the rally were landowners backing regulations that would let them sell leases for the deep reserves. The owners want to sell rights in the western Catskills and Southern Tier to drilling companies. They say detailed lease terms and proposed Department of Environmental Conservation rules will protect them, their water and the landscape while generating hundreds of millions of dollars. “The environmentalists are right here; we’re the people who own the land,” said Dale Roe, an IBM retiree with 85 acres in the Broome County town of Glen Aubrey. Roe, chairman of the Western Barker Landowners Coalition, said it’s one of 27 affiliated groups that collectively represent some 17,000 households. They would be the first to experience problems with their own water wells and property; he’s investigated it closely and said he’s not concerned.”

When Gummy Bears Attack

New Environmental Working Group white paper cites ProPublica, TEDX, and even itself in desperate smear campaign targeting HF

Lip gloss, sunscreen, and gummy bears – any idea what these three things have in common? Key ingredients of each are derived from a barrel of oil, believe it or not – so-called “petroleum distillates” that are essential to making everyday household items like deodorant and shampoo work the way they’re intended, albeit used in small enough quantities to ensure they’re safe for the millions of Americans who consume them.

You know what else is considered a petroleum distillate? Diesel fuel. Thankfully, you won’t find any of that in your lip balm. And the truth is, you won’t find any of it in the solutions used during the hydraulic fracturing process either. 

Of course, irrespective of the materials used in fracturing a well, for those interesting in determining how safe the procedure is, the central question remains a simple one: How is that substance supposed to find its way through inches-thick steel casing cemented into the well bore?  In other words, what are the pathways of exposure here? What exactly is it about a technology that’s been used millions times that just now, out of the blue, is suddenly so deleterious to our drinking water supplies? State regulators learned long ago that the way you protect groundwater is by keeping oil production fluids out of it. It’s a system that works; it doesn’t need EPA to be called in to slap it around.

On those questions, the Environmental Working Group (EWG) doesn’t claim to have many answers. In fact, all the group appears able and willing to claim in its recently posted white paper is that diesel fuel is being used in frac operations – notwithstanding the fact that federal statute explicitly identifies diesel fuel as a substance that, if used, immediately lands that operation under the regulatory authority of EPA.

But why would a fossil fuel-distillate like diesel be targeted for elimination when the formations being fractured already contain naturally occurring fossil fuels as it is? Good question. But it was. And so today, diesel fuel is simply not used in fracturing operations. Except in the trucks, of course – they still need diesel to run.  

Whether EWG genuinely understands any of this, it’s tough to say. On one hand, the group states categorically on the opening page of its report that “toxic petroleum distillates” – which “include diesel” – are “threatening drinking water supplies from Pennsylvania to Wyoming,” citing a recent article by the advocacy group ProPublica in a half-hearted attempt to legitimize the assertion (ProPublica writer Abrahm Lustgarten is actually cited 12 separate times in 23 pages of text – but who’s counting?)

But here’s the thing: Later on that same page, we learn that a different culprit is to blame for these alleged incidents: Not diesel fuel itself per se, the report says, but “petroleum distillates that can be similar to diesel.”

Nonetheless, there you see “diesel” popping up again on EWG’s list of “petroleum distillates used in hydraulic fracturing,” with the group even citing an Aug. 2009 document published by the Pennsylvania Department of Environmental Protection (DEP) to back up its assertion. The only problem? The report to which they point says precisely the opposite of what EWG alleges. Here’s the report. See there on page 2 where it says the use of diesel fuel in fracturing operations has been “discontinued”? EWG must not have.

But let’s get back to these petroleum distillates for a second. Sure, you can find them in nail polish and wax paper, but how much of the fracturing solution do these things actually make up? Well, remember first that more than 99.5 percent of the materials used in a typical fracturing job is water and sand. So what makes up the remainder? Included below is a cut-away image of one of Energy In Depth’s most popular downloads.

Adapted from a similar chart organized by the U.S. Department of Energy and the Ground Water Protection Council (page 78 of the PDF, available here), this document shows us a couple things: For starters, specific to the one-half of one-percent of the fracturing solution that’s not water or sand, only 0.088 percent of what remains is made up of these distillates. And second: Even if you accept the premise that infinitesimally small amounts of those distillates are used in the typical frac job, we’re talking about a substance that you could just as easily find in “make up remover, laxatives, and candy.”

See the game being played here? EWG has no evidence that diesel fuel is being used in fracturing operations; it has no evidence that rounding error-volume distillates are dangerous; and it has no interest in providing the proper context to its readers so that they might be able to make these determinations for themselves.

And as mentioned, perhaps the most regrettable reality of this whole report is that the group barely even attempts to explain to its readers how these “dangerous” materials are supposed to gain access to our drinking water – sine qua non to this entire debate. And once again, there’s a reason for that too: Steel casing is installed and cemented into place in each well that’s fractured nationwide, ensuring that what’s going down inside the wellbore has no chance of affecting that which is occurring naturally outside it. They know this. And that’s why they worked hard to ensure their report doesn’t say it.  

As for the other blatant errors in the EWG report, perhaps we’ll leave some of those for another day. After all, how many times should we be expected to remind these folks that hydraulic fracturing has never been regulated under the Safe Drinking Water Act, and therefore would’ve never needed an “exemption” from it? Our sense is that, by now, they know what’s factually accurate in this debate and what is not.

Our other sense is this: They just don’t care.

Markey’s Hearing Aide

As Congress examines critical role that shale gas can play in securing America’s energy future, U.S. Energy Secretary renders his scientific judgment on key technology needed to produce it

Tomorrow morning, the chairman of the House Energy and Commerce subcommittee on energy and environment will preside over a congressional hearing slated to examine, among other issues, the current dimensions and future trajectory of the American energy revolution known as shale gas exploration.

The event is not expected to include testimony from U.S. Energy secretary Steven Chu. But if Mr. Chu’s recent comments on the safety and necessity of hydraulic fracturing are any indication, the 1997 Nobel prize-winner in the category of physics has plenty to add to a debate that would certainly benefit from some genuine scientific perspective.

Now, it’s true: Chu’s professional expertise isn’t often considered to reside in the sphere of upstream oil and natural gas production. But the man is considered an expert in the magneto-optical trapping of subatomic particles; it was Chu, after all, who came up with the idea of adding a spatially varying magnetic quadrupole to the red detuned optical field to perfect the process of laser cooling (why didn’t we think of that?!). So when the Energy secretary has something to say about the safety of modern-day shale gas technology, as he did late last week, he’ll find in us a captive audience:

U.S. Energy Secretary Steven Chu said on Friday that fracking could be done in a way to remove oil or gas that would not harm the environment and suggested Congress should not outlaw the practice.

“If it can be extracted in an environmentally safe way, then why would you want to ban it?” Chu told reporters. “I think it can be done responsibly.”We believe it can be done safely as well, incidentally – and not just because we’ve been deploying fracturing technology for more than 60 years now, and more than 1.1 million separate times, without engendering a single, credible case of drinking water contamination. For us, the better guidepost is science – science that not only confirms that which has not happened in the past, but a field of study that considers the geo-physical realities at play in ensuring it does not, and indeed cannot, happen in the future.

So for that, we look to geology – specifically, the physical barriers that exist between the underground strata containing potable supplies of drinking water (generally found between 100-350 feet below the surface) and the formations below (often miles below) that hold trillions of cubic feet of diffuse, tightly packed, job-creating shale gas resources. How do we know those confining strata will do their job and ensure the water at 200 feet is appropriately separated from the shale at 8,500 feet? Because they’ve been doing that job for a million years now — preventing the salty water that’s already down there naturally from penetrating our aquifers and ruining our drinking water.

But the science doesn’t end there; it’s expanded upon by operators and engineers on the surface, gilding the lily even further by cementing millions of pounds (and thousands of feet) of steel casing into the well – thus eliminating any and all pathways of exposure between what’s taking place inside the wellbore, and what’s naturally occurring outside it. That’s why fracturing is safe – not just because of the technology used to safeguard our water; not just because of the natural, geological barriers that exist below ground; not just because of the thorough regulatory oversight executed by the states; but thanks to a confluence of all these important components; each and every time, in each and every state in which the technology is deployed.

So, the question is: Will any of this come up in the subcommittee hearing tomorrow? Tough to say for sure. What we do know, however, is that Chairman Markey understands the critical role that the responsible development of America’s shale gas can play in achieving several specific economic and environmental goals near and dear to his heart. We include his latest comments on shale gas below – but trust us: the audio file does his statement a whole lot more justice.

Ninety percent of all new electrical capacity in America since 1990 has been natural gas, and it’s going to continue on that way as a baseload … But natural gas is going to do very well in the future, and the discoveries from the Marcellus Shale all the way through Barnett, that is all the way from New York down to Texas, are going to be big source of new electrical generation.

He’s right – the future of natural gas is as bright as it is boundless. But its potential will only be realized if Congress heeds the advice of Secretary Chu, the scientist, and doesn’t indulge itself in the unscientific justifications peddled by exponents of the FRAC Act.

Additional resources available at Energy In Depth:

• Houston Chronicle: Think shale drilling uses the most water? Guess again.
• Issue Alert: What Lies Beneath
• Fact Sheet: HF Opponents Say the Darndest Things
• GWPC Study: State Oil and Natural Gas Regulations Designed to Protect Water Resources
• Graphic: What’s In Frac Fluids?
• EPA Study: Study to Evaluate the Impacts to USDWs by Hydraulic Fracturing of Coalbed Methane Reservoirs
• Browner Memo: Letter of Support for Hydraulic Fracturing from Carol Browner, Fmr. EPA Administrator

Energy In Depth: Today’s News

US Energy Secretary Calls For Congress To Pass Climate Bill. Dow Jones. “Chu said the fuel could potentially crowd out investment in alternative energies because of recent big discoveries of gas in shale, hard rock formations, in the U.S … adding that gas could be accessed from shale regions safely. Environmentalists have been concerned that the technique of accessing shale gas, known as hydraulic fracturing, might pollute water. “I think it can be done responsibly,” Chu said. He said that most of the shale beds lay below water tables, but added that “there’s a hundred ways to mess up something.” Exxon Mobil Corp has said that its planned purchase of XTO Energy might not go through if Congress decides to ban hydraulic fracturing. ‘If it can be extracted in an environmentally safe way, then why would you want to ban it?’ Chu said.”

Interest runs high in gas-drilling plans. Utica (NY) Observer Dispatch. “Opponents say [hydraulic fracturing] would cause massive pollution. … Not so, said Chris Tucker, a spokesman for Energy in Depth, a natural oil and gas trade organization. The fracking process has been used for 60 years and has never been “credibly tied” to drinking water contamination, he said. “It’s not an unbelievable streak of good luck,” Tucker said. “It’s a function of the fact that millions of tons of impermeable rock separate the formations we’re fracturing from the formations that support drinking water.”

TCEQ tests finds no air quality issues. Fort Worth Business Press. “The state environmental agency charged with studying air quality reported that benzene and other volatile organic compounds are not at threatening levels in Fort Worth city limits, but more studies will be conducted around the Barnett Shale to get a better picture of what effects, if any, gas drilling has on North Texas air.” NOTE: Click HERE to view EID’s Issue Alert on this.

Chu steps into gas drilling debate. The Hill. “Energy Secretary Steven Chu on Friday said a controversial natural gas drilling technique called hydraulic fracturing, which energy companies are increasingly using to access abundant U.S. shale gas reserves, can be performed safely. The comments come amid a major lobbying effort by oil-and-gas companies to prevent Congress from increasing regulation of the practice. Environmentalists fear that “fracking” will pollute water supplies while industry contends the practice is safe.”

Exxon, XTO to testify to Congress on merger. Reuters. “Exxon Chairman and CEO Rex Tillerson and Bob Simpson, chairman of XTO, have been called to testify. The committee, which is chaired by Representative Edward Markey, could be considering a range of issues regarding the merger, including a controversial drilling technique used to tap oil and gas fields. … Hydraulic fracturing, or “fracking,” injects a mixture of water, sand and chemicals into rock formations to stimulate production. Some environmental groups oppose the technique as unsafe and seek more regulation over it.” NOTE: Click HERE to view the House Energy and Commerce Committee’s hearing announcement.

House subcommittee to question Exxon, XTO Energy executives. Fort Worth Star-Telegram. “A congressional subcommittee is expected to pepper Exxon Mobil CEO Rex Tillerson and XTO Energy Chairman Bob Simpson with questions Wednesday about Irving-based Exxon’s planned $31 billion acquisition of Fort Worth-based XTO. The setting will be an 8:30 a.m. session of the energy and environment subcommittee of the powerful House Energy and Commerce Committee in Washington. … Exxon’s buyout agreement allows it to kill the deal if Congress passes legislation making hydraulic fracturing commercially impracticable. Energy lobbyists expect hydraulic fracturing to come up at Wednesday’s hearing, according to a report by Reuters. Reuters quoted Energy Secretary Steven Chu as saying fracturing can be done without environmental harm.”

Using high efficiency to get down deep. Glenwood Springs Post Independent. “The gas drilling rig is right off Interstate 70 to the west of the Rulison exit, near enough to the highway for the workers to hear the hum of passing cars and trucks if the noise from the drilling equipment itself were ever to stop. But it doesn’t — at least, not at what are known as “high-efficiency” rigs, the most technologically advanced set-up in use in this area. According to the company that operates this particular rig, Williams, the machinery and the men running it are hard at work 24 hours a day, seven days a week, and will be until its job is done and the rig is moved to another site.”

Many Central New York lawmakers undecided on hydrofracking. Syracuse (NY) Post-Standard. “As New York wrestles with how to regulate natural gas drilling, state lawmakers from Central New York will soon have to decide an important question: Do they support high-volume hydraulic fracturing? Right now, many can’t say. “It has definitely got some economic benefits,” said Assemblyman Bill Magee, D-Nelson, “but on the other side, there are legitimate concerns about the kind of chemicals being used, the amount of water being used, the disposal of the wastewater and so on.” … “It’s very easy to spread misinformation about our industry,” said Paul Hagemeier, Chesapeake’s vice president of regulatory compliance.” NOTE: Click HERE to view where NY state legislators stand on shale gas issues.

Dramatic education sometimes the best antidote for fear. Oil & Gas Journal, Op-Ed. “Because antidevelopment environmentalists know how to manipulate fear, advocates of oil and gas development need to know how to combat it. Fear and its environmentalist promoters are impeding development of the huge Marcellus shale gas resource in New York and Pennsylvania. Opponents to drilling have raised fear about hydraulic fracturing, the technique that has been used safely and often since the 1940s, modern refinements to which make shale development possible. But use of hydraulic fracing is new to parts of Pennsylvania and New York, and drilling opponents say it threatens subsurface drinking-water supplies.”

Agencies keep eye on natural gas drilling boom. Citizens Voice (PA). “As interest in the Marcellus Shale as a source of natural gas grows, agencies including the state Department of Environmental Protection and the tri-state Susquehanna River Basin Commission are keeping a watchful eye on drillers. Pennsylvania’s oil and gas regulations are “probably some of the most comprehensive of any state’s,” DEP spokesman Tom Rathbun said. Besides the state Oil and Gas Act, natural gas drillers must obey the federal Clean Water Act, the state Clean Streams Law, the Community and Worker Right to Know Act and the Dam Safety Law, among others, he said. “I think they (gas companies) see how stringently we’re going to regulate them,” Rathbun said. “I think the industry sees we’re serious about protecting our water.”

Tunkhannock family is paying gas drilling profits forward. Wilkes Barre (PA) Times-Leader. “Buster and Linda Coolbaugh leased almost 16 acres of property at $5,750 per acre for five years to Chesapeake Energy. They received $1,000 an acre in October and a lump sum payment in December of last year. The Coolbaughs donated to several area charities, including the Meadows Nursing Center Auxiliary, the Dietrich Theater, Kunkle Fire and Ambulance, Triton Hose Company, Bowman’s Creek Free Methodist Church, the American Red Cross and the Northeast Region Conservation District. Their total donation to the charities was nearly $4,200.

Marcellus Shale exploration expands in Luzerne County. Scranton (PA) Times-Tribune. “Three natural gas wells are planned for Luzerne County, expanding the region’s role in Marcellus Shale exploration. EnCana Oil & Gas (USA) Inc., in partnership with WhitMar Exploration Co., has applied for permits to drill exploratory gas wells at sites in Fairmount, Lake and Lehman Twps. DEP records show that one permit to drill and operate a well has been issued so far in Luzerne County, for the Lehman Twp. site. A public hearing on the local application for use of the site will be held Wednesday at 6 p.m. in the Lehman Twp. Building, after which the supervisors will have a special meeting to deliberate on whether to issue an occupancy permit.”

All hail the shale: Give us our share. Pittsburgh Tribune-Review, Op-Ed. “Rendell also is revisiting the idea of an extraction tax on natural gas pumped at the wellhead. If the Legislature approves such a levy, even more money can be made from the drilling. … In 1976, the land of the midnight sun established a fund using some of the revenues from the state’s oil and natural gas sales. Alaska invested the money and began paying residents an annual dividend beginning in 1982. The Alaska Permanent Fund since has distributed enough money to redecorate every igloo in the state several times over. The dividends have ranged from $331 in 1983 to $2,069 in 2008; the 2009 dividend was $1,305. That would be a nice amount to have arriving in the mailbox around the time you file your tax returns.”

National Fuel expands presence. Buffalo (NY) News. “National Fuel Gas Co. is expanding its presence in the Marcellus Shale region in northwestern Pennsylvania, an area potentially rich with natural gas.  The Amherst-based energy company this week emerged as the winning bidder in an auction conducted by Pennsylvania officials for the rights to drill on two tracts of land in state forests. … “Both tracts are relatively close to our other Tioga acreage and were acquired at what we consider to be a favorable price,” said Donna L. De- Carolis, a National Fuel spokeswoman.”

Meeting to explore pros and cons of natural-gas drilling. Olean (NY) Times Herald. “Local officials plan to take a look at what could quell many concerns with regional energy consumption. On Tuesday evening before the Olean Common Council holds its regular session, the Strategic Planning Committee will meet to discuss what tapping into the natural-gas reserves in the Marcellus Shale could mean for the city. … “There are huge economic possibilities as well as serious environmental concerns relating to the development of this immense local resource. The New York State DEC Website estimates maximum potential resources of 516 trillion cubic feet of natural gas,” Earl McElfresh, R-Ward 1, and Strategic Planning Committee chairman, said. “That would be enough to supply current New York state natural-gas usage for 500 years.”

Energy Insider: Cold Oil. KFYR-TV (ND). “No one ever said oil production was easy. Drilling thousands of feet underground and fracturing the rock to get to the crude is hard enough. Add a North Dakota winter and “it will mean a lot of money needs to be spent to fracture and drill wells,” says Roger Nash, Technical Manager for Pumpco Services. Water is one of the most important ingredients in a process called hydraulic fracturing.”

BP will suspend drilling in area. Durango (CO) Herald. “BP America will cease drilling in La Plata County for at least six months as it pursues development opportunities elsewhere, a company spokesman said Thursday. Curtis Thomas, BP’s director of government and public affairs in the Rockies, said the company in February will idle the last drilling rig that it has running in the county. … “The decline in prices and demand and the opportunity to invest that drilling capital in other parts of the country presented themselves at the same time.” He said the company was turning its eyes toward Texas, where hydraulic fracturing combined with directional drilling in shale layers have spurred a gas boom in recent years.”

Sinopec, BP Discuss Shale-Gas Exploration in China. Wall Street Journal. “China Petrochemical Corp., or Sinopec Group, said it is in talks with BP PLC on cooperation in shale gas exploration and development in China, underscoring the growing interest major international oil companies have in gaining a foothold in shale-gas fields world-wide. “The talks are going smoothly,” Sinopec said Monday in its official newsletter. “This move could accelerate development in unconventional oil and gas fields with the help of foreign advanced conception and technology.”

Side By Side: Same Day, Two Different Stories on Air Quality From Dallas-Ft. Worth

Texas CEQ: “Oil and Gas Air Tests in Ft. Worth Find ‘No Cause for Concern’” (Release, 1/12/09)

Energy In Depth: Today’s News

Hinchey calls for oversight of gas drilling. Times Herald-Record. “[Congressman] Hinchey is sponsoring legislation that would eliminate what he says is an exemption gas and oil companies have from some provisions in the Safe Drinking Water Act. … Hinchey said the exemption was approved by Congress in 2005 in legislation that came out of then-Vice President Dick Cheney’s Energy Task Force. … But Brad Gill, executive director of the Independent Oil and Gas Association of New York, says that there never was an “exemption” because when the Clean Water Act became law in 1974, it was intended to regulate underground waste disposal but not energy production. He said the Environmental Protection Agency says there has never been a case of groundwater contamination. “Why would you want federal oversight over a process that has proven to be safe?” he asked.”

Debate Continues Over Shale Plan. WXXI (NY). “Brad Gill is the executive director of the Independent Oil and Gas Association of New York State. That organization is supportive of the draft process that the DEC is conducting, because as soon as it’s finalized, permits can be issued, so members can exploit the natural gas trapped in the shale. “Our industry operates under some pretty critical time frames. When you take leases for example, the clock is running on those leases and it really inhibits the ability for companies who are wanting to come into New York and spend hundreds of millions of dollars on leasing to even want to do that in this kind of regulatory uncertainty. The end result of that really is a negative economic impact to the state.”

Gas drillers bid twice what Pa. budgeted. Philadelphia Inquirer. “Natural-gas drillers yesterday bid $128.5 million to develop 32,000 acres of Pennsylvania state forests, twice the revenue the state had budgeted, prompting fears of a headlong rush to overrun public lands to tap into the rich Marcellus Shale. Gas drillers offered an average of $4,020 per acre – almost twice the amount that such leases generated less than two years ago – for the right to extract natural gas from six tracts of state forest in north-central Pennsylvania. The robust bidding was further proof of the intense industry interest in the Marcellus Shale … “This shows the industry’s ability to generate wealth for Pennsylvanians,” said Kathryn Klaber, president of the Marcellus Shale Coalition.”

5 firms submit high bids for gas drilling in Pa. Associated Press. “Five companies are willing to pay more than $128 million for the right to drill for natural gas on Pennsylvania public forest land as the cash-strapped state scrounges for money. The unsealing of winning bids Tuesday by the state forests department unofficially awarded drilling rights on nearly 32,000 acres in northcentral Pennsylvania. The prize is the right to drill in the Marcellus Shale natural gas formation, which some geologists expect to become the nation’s most prolific gas field.”

Bossier City has plenty of 2010 happenings. Shreveport (LA) Times. “For those who are wondering whatever happened to the Haynesville Shale, Chesapeake Energy Corp. announced its discovery of the large pocket of shale in March 2008 and has quickly accelerated its development, according to Public Relations Manager Katie McCullen. She said Chesapeake is the largest leasehold owner, largest producer and most active driller of new wells in the Haynesville Shale and controls more than 620,000 net acres. …Looking ahead to 2010, Gov. Jindal has signed legislation, supported by Chesapeake, authored by state Rep. Jane Smith, R-Bossier City, and led by Sen. Nick Gautreaux, D-Abbeville, in the Senate, which will increase economic development and investment in Louisiana by encouraging companies to use a fuel source.”

Tests find emissions of Fort Worth drilling sites don’t exceed standards. Fort Worth Star-Telegram. “State officials say preliminary tests showed no evidence that natural gas drilling is releasing hazardous chemicals in Fort Worth, after three days of sampling in December. “Based on this study, the air’s safe and we will continue to monitor,” said John Sadlier, deputy director of the Texas Commission on Environmental Quality. The commission’s staff checked 126 Barnett Shale gas sites in the city with toxic vapor analyzers and infrared cameras, which can detect emissions that are invisible to the naked eye. There was enough evidence at eight of those sites to warrant more extensive canister tests.”

Texas agency finds no air problems in Fort Worth. Associated Press. “The Texas environmental agency says a survey of more than 100 natural gas facilities in Fort Worth showed no cause for concern about potentially dangerous pollutants. The agency says the study was done the week of Dec. 14 because of concerns from residents. John Sadlier of the Texas Commission on Environmental Quality says pollutants were below the level that would cause health concerns. Among the pollutants tested for was benzene, a known carcinogen that has been detected elsewhere on the Barnett Shale. Fort Worth is one of many cities atop the Barnett Shale – a massive underground rock formation loaded with natural gas.”

Natural Gas as Fuel of Choice, Little Change for Other Technologies. MasterResources.org. “Shale formed in those deposits contained methane bound so tightly into the rock formations that conventional drilling technology could not get at it, according to the geologists. That’s changed. Deep drilling, horizontal drilling, and hydraulic fracturing (pumping water down the borehole at great pressures to shatter the shale strata, releasing the methane from the rock) make the gas accessible. Both shale finds are providing drillers with gas bonanzas.”

Winter Slows Oil Work. KFYR-TV (ND). “The cold weather we’ve felt the last few weeks is slowing down work on our state’s oil fields. But sub-freezing temperatures haven’t stopped activity completely. Oil-related work like hydraulic fracturing and horizontal drilling usually takes longer to complete this time of year. The low temperatures and strong winds add challenges to the oil drilling process unique to North Dakota. But companies are plugging along despite the obstacles. … “From fracturing companies to oil companies themselves. And I think there`s ground to make up.” Firms like PumpCo have to use salt water instead of regular fresh water for their hydraulic fracturing so their pumps don`t freeze.”

Sector has reason to keep chin up. Calgary Herald. “Not only is the EIA forecasting a slow steady rise in energy prices, it is not sounding any alarm bells on the impact of existing spare oil production capacity or surplus natural gas storage. In fact, the EIA is of the view that the spare capacity as a result of the production cutbacks means a price spike can be avoided as the global economy reclaims a reasonable pace of growth. As for the natural gas piece, the EIA is surprisingly positive. Notwithstanding the mammoth shale gas fields, the EIA points to steep declines, modest recovery in consumption and the dramatic drop in drilling as reasons why natural gas prices are also poised to recover.”

Arlington council OKs hearing on proposed gas-drilling site. Fort Worth Star-Telegram. “The City Council on Tuesday approved five natural gas drilling-related requests and agreed to hold a public hearing on a proposed drill site in southeast Arlington that was rejected by the Planning and Zoning Commission last month. The pending case – dubbed the “Matlock Yu” drill site – has several challenges, including its proximity to another Matlock Road drilling site as well as a day-care center, two city parks and about 30 homes, city officials said.”

Unconventional gas players ramp up drilling. MarketWatch. “Not all risks are gone, however, as the industry faces a glut in supply and contending with volatile winter and summer temperatures, as well as regulatory scrutiny over the millions of gallons of high-pressure water used to facture rock and extract natural gas. Talisman started moving aggressively into North American natural gas by shedding nearly $3 billion in oil and gas assets overseas in the past couple of years, with the aim of redeploying resources in the business of drilling horizontal wells and fracturing the rock to extract natural gas.”

Agonizing drilling delays. Press & Sun-Bulletin (NY), LTE. “We see that New York City wants to limit the mineral rights of those people who live in the Catskills so that companies cannot drill for natural gas in that area. If New York City wants to limit those rights, it should pay for them, not steal them. In addition, the Department of Environmental Conservation’s union representatives should be ashamed of themselves. They want another year to fix the sGEIS document. They already had regulations controlling vertical drilling, and all they had to do was add special requirements for horizontal drilling. That was a year and a half ago, and now they want another year?”

Second Marcellus Shale business webinar series scheduled. Pocono (PA) News. “The Marcellus shale formation is driving energy firms to Pennsylvania, and the influx of dollars is creating significant business opportunities with natural gas and service companies, supporting businesses and worker spending. As this development of Marcellus Shale Natural Gas grows in Pennsylvania, business people statewide are being invited to the second series of morning seminars to learn how it may create opportunities for their businesses.”

Energy In Depth: Today’s News

Natural gas could drive stable future. Chickasha (OK) Express Star. “[Sen Inhofe] supports the controversial process known as hydraulic fracturing or “fracking” to loosen the encased gas pockets. Thanks to fracking, many trillions of cubic feet of gas that was deemed inaccessible just a few years ago have been reached, increasing gas availability from 50 years to more than 90 years at current usage rate of 23 billion cubic feet per year. Between 2004 and 2008 gas reserves jumped 58 percent. Fracking works by forcing water and other chemicals into wells causing horizontal fractures in underground rock formations. … “Without hydraulic fracturing we cannot capture that gas. There is no other option” Inhofe said. “The problem we’re having is a bureaucratic one.” … Experts say fracking has been used for more than 40 years with zero instances of drinking water pollution.”

Marcellus coalition names first CEO. Philadelphia Inquirer/Washington (PA) Observer Reporter. “The Marcellus Shale Coalition, a Pennsylvania natural gas trade group formed last year, today appointed an Allegheny County economic development official as its first president and chief executive. Kathryn Klaber, 43, who was executive vice president at the Allegheny Conference on Community Development and executive director of the Pennsylvania Economy League, will oversee the gas-industry lobbying group. It will be headquartered in southwestern Pennsylvania. Klaber, a Pennsylvania native educated at Bucknell University and Carnegie Mellon University, worked as a consultant from 1990-1995 at the Philadelphia office of Environmental Resources Management Inc.” Click HERE to read more about Ms. Klaber.

DEC commissioner: Gas spill reports misleading. Press & Sun-Bulletin (NY). “The commissioner of the state Department of Environmental Conservation has asserted that reports of accidents related to natural gas drilling in New York have been overblown and taken out of context. In a letter to Assemblyman William Parment, D-150th, a member of the Environmental Conservation committee, DEC Commissioner Pete Grannis said that of the 270 incidents highlighted by an Ithaca researcher, more than half have nothing to do with natural gas drilling — and they occurred while the DEC was overseeing 10,400 wells.”

Marcellus shale program draws over 100. Mineral Daily News-Tribune (WV). “More than 100 people gathered at the Keyser High School auditorium on a snowy Thursday night for “Marcellus Shale 101,” a program that introduced area residents to the natural gas formation and offered tips for landowers thinking about leasing their property for drilling. … “This is a multi-generational impact,” Murphy said. “It’s not just a blip on the radar. It’s going to play out over a long time.” Spurring development of Marcellus gas is the nation’s need to develop native energy sources as oil deposits decline and the price of foreign oil continues to escalate, with economic and national security implications. … “This is something I think we’re going to be hearing about in Mineral County quite a lot,” Spiggle said. said. “It’s a tremendous opportunity for the entire region.”

Garfield County seeks members for Energy Advisory Board. Glenwood Springs (CO) Post Independent. “A local board that acts as the liaison between gas companies and the public is still short of citizen representation, several months after organizers started working to find new members. … The EAB meets once a month in Rifle, to discuss a variety of issues relating to the industry’s activities, including complaints from landowners and others, reports on the level of drilling and other activity, and updates on community relations efforts by the companies. The meetings also often involve an educational presentation about one or another aspect of the industry, from the nature of hydraulic fracturing (known as frac’ing), to the current thinking about oil shale, to the new technology known as “remote frac’ing,” which, according to industry experts, can involve distances of up to three miles from the well pad to the bottom of the well bore.”

Governor fights federal lease rules. Billings (WY) Gazette. “In a letter to Salazar sent Friday, [Gov. Dave] Freudenthal said the proposed policy changes would create burdensome new requirements and give environmental interests “a stranglehold on an already cumbersome process.” “The proposed changes potentially hand significant control over oil and gas exploration, development and production to the whims of those that profess a ‘nowhere, not ever’ philosophy to surface disturbance of any kind,” Freudenthal wrote in the letter. Freudenthal also asserted that adding more environmental reviews would be redundant and potentially open the door to even more lawsuits over oil and gas leases.” … Cheryl Sorenson, vice president of the Wyoming Petroleum Association, said her organization is very supportive of Freudenthal’s arguments in his letter to Salazar.”

Barnett Shale Meeting Rescheduled. Fort Worth Weekly. “Last Thursday’s North Central Texas Communities Alliance meeting about problems associated with Barnett Shale gas drilling, canceled because of inclement weather, has been rescheduled for this Wednesday, January 13. DISH Mayor Calvin Tillman, whose town sits in the epicenter of gas drilling, will be the featured speaker. He plans to discuss the air quality in DISH, the new Texas Commission on Environmental Quality policy on ambient air monitoring and a proposed moratorium on gas drilling in the Barnett Shale. The meeting is open to the public.”

Energy In Depth: Today’s News

‘Fracking’ Under Pressure. Philadelphia Inquirer. “The frack job was frozen. Deep beneath an icy Tioga County farm last week, an effort to extract natural gas from the Marcellus Shale shuddered to a halt. The culprit was not the 14-degree weather, but an innocuous material more often associated with beaches: sand. The procedure known as hydraulic fracturing, or “fracking,” is designed to liberate gas locked in the shale by injecting pressurized fluid into a well to shatter the rock. But this frack job in north-central Pennsylvania was stalled: Sand contained in the frack fluid had clogged up the bore.”

Land owners’ liability. Ithaca Journal, LTE. “Assemblywoman Barbara Lifton, D-Ithaca, recently introduced a bill that would make landowners liable for activities related to hydraulic-fracturing on their property. Her bill is intended to protect those who would lease their land to drilling companies, but it would do the opposite. The bill would allow claimants to pursue a claim against any one party in the lease agreement as if they were equally responsible. … Hydraulic-fracturing is safe and efficient. New York has the toughest environmental regulations in the country. That should be enough to assure the public, Lifton and environmental groups who have fooled the public and used this opportunity for political gain and fundraising.”

Industry looking up, but threats remain. Daily Advertiser, LOGA’s Don Briggs. “As we close the door on 2009, the new year is looking brighter for Louisiana’s oil and gas community. After a year plagued with uncertainty and price instability, 2010 may prove to be a more promising year. … The Interstate Natural Gas Association of America estimates that nearly 300,000 natural gas wells will be drilled and completed using the technology of hydraulic fracturing by 2030. The oil and gas industry has utilized this technology for nearly 50 years without a single environmental incident. A liberal Democratic majority in Congress and an anti-oil-and-gas administration are pushing for the EPA to regulate hydraulic fracturing.”

Gone to Texas: Shale gas bringing majors back to state. Fort Worth Business Press, Op-Ed. “Why are the major oil companies coming back into Texas? Recently, Exxon Mobil Corp. announced it would pay $41 billion for Fort Worth-based XTO Energy Inc., and Total, an integrated oil and gas company with headquarters in France, announced a $2.25 billion deal with Chesapeake Energy Corp. Both of these deals involve acquisition of unconventional natural gas reserves in the Barnett Shale in North Texas.”

Revving up: Energy companies poised to drill Marcellus Shale in N.Y. Elmira Star-Gazette. “If the Marcellus Shale were a target, the bull’s-eye would encompass northern Pennsylvania and the Southern Tier. Companies seeking the multibillion-dollar promise of domestic natural gas production have begun bearing down on the Pennsylvania part of that bull’s-eye. According to data filed with the state Department of Environmental Protection, there were 191 wells drilled in Susquehanna, Bradford and Tioga counties in 2009. Not surprisingly, they have found one of the thickest and most geologically promising Marcellus section, living up to its expectation.”

Devon Energy hedges prices, eyes asset sales by Q3. Reuters. “Devon Energy Corp plans to hedge half its oil and gas output this year and aims to complete the sale of assets outside its core North American onshore business by the third quarter, its CEO said on Friday. … “But [Nichols] said Devon deliberately had no interest in the Marcellus shale in the U.S. Northeast, not because it lacked potential, but due to environmental opposition. … “It is more a concern about the above-ground risk,” Nichols said, echoing the worries of his counterparts at rivals … He put much of the opposition to fracking among the better-informed environmentalists down to their underlying desire to move away from burning hydrocarbons for energy. “If you have cheap and abundant natural gas, the amount of subsidies that you then have to get for wind, solar or biomass would mean that they wouldn’t get done,” he said.”

State ban on gas drilling unlikely. Times Herald-Record. “Don’t look for the state to heed calls to stop or slow down gas drilling — even though the requests have come from such powerful interests as New York City, the Environmental Protection Agency and a union of Department of Environmental Conservation workers. In the just-ended comment period on new regulations for gas drilling in the Marcellus shale, which sits beneath Sullivan County and much of the New York City watershed, many of the approximately 12,000 responses urged the state to scrap the regulations and redo them. Critics want new rules to ban drilling in the city watershed and address such issues as pollution from the horizontal drilling method, known as “fracking,” and cumulative impacts.”

‘Monster’ well in Arlington is top producer in Barnett Shale. Fort Worth Star-Telegram. “A natural gas well with the nondescript name “Day Kimball Hill #A1″ was the seventh Barnett Shale well drilled by Chesapeake Energy at a site in Arlington in far southeast Tarrant County. The first six wells drilled there have been average or above average in production, said Dave Leopold, Chesapeake’s operations manager for the Barnett Shale. But Chesapeake CEO Aubrey McClendon has a more dramatic description for the seventh well. “It’s a monster!” he told the Star-Telegram in a recent telephone conversation.”

Skyrocketing performer close at hand. Houston Chronicle. “Houston-based Southwestern Energy led the Standard & Poor’s 500 Index, racking up a stunning 5,776 percent return between 2000 and 2009, compared with a 24 percent decline for the index. … It moved to Houston in 2001 and began buying property in Arkansas’ prolific Fayetteville Shale two years later, long before the shale gas boom. “They figured out the Fayetteville shale before anybody,” Heikkinen said. “They got in early enough, and they benefited from the escalation of gas prices.” … The past year has been difficult for many shale plays. Drilling in shale formations is expensive, and falling natural gas prices turned some projects into money losers. Larger producers, like Chesapeake Energy, are courting joint venture partners with deep pockets to raise capital for new drilling.”

Several hurdles stand in way of local gas drilling. Citizens Voice. “Although WhitMar Exploration Co. and EnCana Oil and Gas USA Inc. have local permission in place to start drilling exploratory natural gas wells on two of the three sites they have chosen in Luzerne County, they still have a ways to go. Last week, the Luzerne County zoning hearing board granted approval for the companies to drill, temporarily house tanks of water for hydraulic fracturing, and set up permanent well heads on sites in Fairmount and Lake townships. The companies have an upcoming hearing before Lehman Township supervisors for permission to drill on a third site.”

No standard leases when it comes to Marcellus shale operation, landowners hear. Cumberland Times-News. “The Marcellus shale could mean big money for West Virginia landowners, but also big issues to consider. That’s the message Tom Murphy, an educator with the Penn State Cooperative Extension in Lycoming County, Pa., delivered to a gathering of roughly 100 residents and officials at Keyser High School on Thursday night. Murphy, co-director of the Penn State Marcellus Center for Outreach and Research, traveled to Keyser to give a public information seminar on the basics of the Marcellus shale, how it could impact the U.S. energy industry, how the drilling process works, its effect on the land, and what landowners stand to gain, or lose. “There’s a lot of money being spent and a lot of activity,”?Murphy said.”

Oil, gas drilling slumps, except for Marcellus. Pittsburgh Tribune-Review. “Drilling of oil and natural gas wells and permits issued tumbled in 2009 across Pennsylvania as prices for both fuels plummeted, according to state Department of Environmental Protection figures. Total wells drilled would have been even lower but for a surge in drilling for natural gas in the Marcellus Shale formation a mile underground, state figures show. In Western Pennsylvania, permits issued dropped by nearly one quarter, and the total number of wells drilled fell by nearly half, figures show. In Allegheny, Armstrong, Beaver, Butler, Fayette, Greene, Indiana, Washington and Westmoreland counties, Marcellus Shale wells drilled jumped by more than three times 2008’s total.”

Marcellus Shale webinars to be offered in Tioga County, NY. Towanda Daily Review. “Marcellus Shale has the potential to fundamentally transform the Southern Tier as interest in the development of natural gas grows in New York State. To help better prepare local businesses in Tioga County, Cornell Cooperative Extension of Tioga County partnered with Tioga County Economic Development and Planning and the Tioga County Chamber of Commerce to host a series of educational webinars from PENNSTATE entitled “Your Business and Marcellus Shale: Voices of Experience”. This series is a follow up to the successful Fall 2009 webinar program, which introduced participants to Marcellus business opportunities. Over 500 local businesses participated in that series at 19 local sites within Pennsylvania and New York.”

Ask, and You Shall Receive

Rep. Hinchey publishes detailed list of additions to draft DEC Marcellus regs; turns out most are already in the DEC document

U.S. Rep. Maurice Hinchey (D-N.Y.) may be one of the chief authors of a bill in Congress that seeks a de facto, nationwide ban on hydraulic fracturing – creatively, by forcing operators to secure special permits from the EPA that the agency has no ability (statutory or operational) to issue. But at least back home in New York, with the state DEC poised to promulgate its final rules governing the safe and responsible development of the Marcellus, the congressman has emerged as a constructive participant in that debate.

For proof, look no further than the press release his office sent on December 23, 2009. Prepared as an accompaniment to the written comments the congressman formally submitted to DEC commissioner Pete Grannis the day before, the document lays out a series of changes to the underlying draft DEC framework that Mr. Hinchey believes DEC must make “before drilling should be permitted in New York.”

It’s a significant statement by Mr. Hinchey – one that, it would appear, puts him at odds with scores of national activists who have called on DEC to throw the entire document in the trash and keep the existing moratorium on all Marcellus activity intact. But that’s not what Mr. Hinchey appears to be demanding here, is it? Taking him at his word, he seems to be supportive of the idea of responsible, job-creating natural gas exploration – he just wants it to be done right.  And thanks to his press release, we now know exactly what he believes is needed to make sure that particular standard is met.

So that’s the good news – but it gets even better from there. Examining the Hinchey press release, it turns out the vast majority of changes the congressman would like to see incorporated into the final DEC regulatory document can already be found in the draft underlying text – right now. The congruity is striking. Take a look for yourself:

Well, then. Now that we’re all in agreement, who thinks it’s about time to get work? Certainly we’ve got jobs to create, revenue for state and local governments to generate, and a clean energy future for New York to deliver. The good news is that now, hopefully, his edits adopted and concerns allayed, Mr. Hinchey can be part of that solution, both nationally and in New York. It’d certainly be a welcome development.

Energy In Depth: Today’s News

** Click HERE to view Chesapeake’s new web video of a natural gas rig tour.

Interior Chief Vows Scrutiny of Oil and Gas Leases. New York Times. “The interior secretary, Ken Salazar, said Wednesday that his department would conduct more rigorous reviews of oil and gas leasing on public lands, declaring that the agency would no longer be a “candy store” for the petroleum industry, as he said it had been during the Bush administration. … “In 2009, we observed a severe slowdown in permitting, project environmental analyses, and leasing,” said Kathleen Sgamma, director of governmental affairs for the Independent Petroleum Association of Mountain States. “We are disappointed to see the DOI moving to a bureaucratic command-and-control system in which government bureaucrats — rather than scientists with expertise in natural gas and oil development — dictate where energy development should occur.”

Proposed New York rules will drive away drillers. Houston Chronicle. “Chesapeake Energy says New York state’s proposed rules on hydraulic fracturing — the technique used widely to tap into natural gas shale formations — will drive it and other E&Ps out of the state, according to Reuters:  ”The measures proposed … will be more burdensome than any of those placed on our industry throughout the United States,” Chesapeake said in public comments made available to Reuters on Tuesday. … Fortuna Energy, a subsidiary of Canada’s Talisman Energy, says it is shifting its focus to Pennsylvania because of the unknowns about New York’s regulatory regime.”

Reed Says Yes to Hydrofracturing. WENY-TV. “Republican candidate for the 29th Congressional District, Tom Reed, says we need to move ahead and legalize the drilling of the Marcellus Shale in New York State. Yesterday, Congressman Eric Massa told us there needs to be more research on the impact drilling will have on the environment and the water sheds surrounding the Marcellus Shale. But today Republican Candidate Tom Reed said it’s time for the drilling to move forward. “Not explore and develop that natural resource to me is irresponsible,” said Reed, “we are ready and ready to go and we should move to the next level with it.”

Local lawmakers react to Paterson’s speech. Corning Leader. “It leaves a lot more questions than answers,” said Assemblyman Jim Bacalles, R-Corning. “I thought it was a dud,” said Assemblyman Tom O’Mara, R-Big Flats. “Another missed opportunity.” … He also criticized Paterson for not advocating drilling in the Marcellus Shale natural gas formation. “If you want to create jobs start drilling for Marcellus Shale gas and you’ll have thousands of jobs in the Southern Tier,” O’Mara said. “He really missed the boat on that.”

Another big Haynesville well. Houston Chronicle. “Houston-based Goodrich Petroleum is reporting a pretty big well in the Haynesville, but this time it’s on the Texas side of the formation in Panola and Rusk Counties.The Company has completed a horizontal Haynesville Shale well, its Billy Harris No. 1H, which produced into sales at a 24 hour peak production rate of 12,200 Mcf per day on a 24/64 inch choke with 6,000 psi. The well was drilled and completed with an approximate 5,000 foot lateral and twenty frac stages. The Company is operator and owns a 100% working interest in the well.”

Endeavour adds Haynesville acreage in N. La. The Advocate. “Houston-based Endeavour International Corp. has spent $27 million to buy interests in the Haynesville and Marcellus gas shale plays in north Louisiana and east Texas, along with properties in western Pennsylvania, Alabama and Montana. Altogether, Endeavour has acquired interests in 526,000 acres. Endeavour acquired 50 percent of Cohort Energy Co.’s interests in 66,000 acres in north Louisiana, east Texas and western Pennsylvania for $15 million. Endeavour could participate in drilling more than 500 horizontal wells over the next 10 to 15 years in the two resource plays, the company reported.”

Gas Drilling Issue. WBGH-TV. “If Drilling for natural gas in the Marcellus Shale takes off it could mean an influx of cash for New York State to help with its financial woes. Governor David Paterson wants the state to double gas production this year, as long as it can be done safely including for the environment. Paterson does not want to extend the comment period further for input on the DEC’s Marcellus drilling rough draft plan. And, says it’s time for a complete review to be done. Congressman Maurice Hinchey says the state has still not proven to him that the unconventional horizontal drilling can be done safely in the Marcellus Shale.”

Applications, permits up for drilling on Western Slope. Denver Post. “The oil-and-gas industry’s equivalent of economic “green shoots” coming up looks to be rigs drilling down. After a year in which drilling permits dropped in Colorado by more than a third, November applications were up 15 percent over October to 427, and in December they were up again to 540. Permit approvals were also up, reaching 653 in December, according to the Colorado Oil and Gas Conservation Commission. … “Operators were holding their breath in 2009, trying to guess where the bottom might be,” said Marc Smith, executive director of the Independent Petroleum Association of Mountain States. “There seems to be a renewed sense of optimism the bottom has been hit.”

EPA vs. EPA: The More Things Stay the Same, the More They Change

EPA VS. EPA

 EPA THEN …

“Although thousands of … wells are fractured annually, EPA did not find confirmed evidence that drinking water wells have been contaminated by hydraulic fracturing.” (EPA, June 2004)

“Repeated testing has failed to substantiate [allegations] that drinking water sources … are being contaminated or endangered, nor is there any substantial likelihood that drinking water sources would be contaminated or endangered as a result of these fracturing operations.” (EPA, May 1995)

“Hydraulic fracturing has been successfully used … to enhance [energy] recovery from deep, tight reserves. The mechanics of hydraulic fracturing in rock formations is well understood.” (EPA, Sept. 1993)

… EPA NOW

 “EPA is particularly concerned about the potential risks associated with gas drilling activities in the New York City watershed and the reservoirs that collect drinking water for nine million people.” (EPA, Dec. 30, 2009)

THE WHOLE TRUTH, AND EVERYTHING BUT?

 WHAT IS HYDRAULIC FRACTURING USED FOR?

 EPA: “Hydraulic fracturing is the injection of fluid under pressure to facilitate the production of oil and natural gas.” (EPA, 2009)

WHAT ELSE IS HYDRAULIC FRACTURING USED FOR?

 EPA: “Hydraulic fracturing is a technology that enhances the effectiveness of other remediation technologies in low permeability soils. … [EPA uses] hydraulic fracturing technology at Superfund and Resource Conservation and Recovery Act (RCRA) hazardous waste sites.” (EPA, Sept. 1993)

ABOUT THOSE BATS

EPA EXPRESSES ‘CONCERN’ …

 EPA: “EPA is especially concerned about the noise impacts of hydraulic fracturing on the hibernating bat population of New York State.” (EPA, Dec. 30, 2009)

… WHILE DEC ACTUALLY INVESTIGATESNY

DEC: “Populations of some bat species have plummeted more than 90 percent in Northeast caves … Called ‘White Nose Syndrome,’ the fungus is a prime suspect as a causative agent.” (DEC, Dec 2009)

HINCHEY’S EPIPHANY

 REP. MAURICE HINCHEY: OPPOSED TO ENERGY INDEPENDENCE …

 ”I do not think that relying on foreign oil impacts our security. I would hope…that there might be a new approach to this whole issue and that approach would essentially mean let us import as much [energy] as we possibly can … ” (Committee remarks, March, 2007)

… BEFORE HE WAS FOR ENERGY INDEPENDENCE

 “The United States is fortunate to have significant natural gas resources to help meet the need for cleaner energy.” (Letter from Rep. Hinchey, et al., to House colleagues; Nov. 4, 2009)

“’We are positioning New York to play a central role in our national goal of achieving energy independence,’ Hinchey said.” (Times Herald-Record, March 2, 2009)

READ MORE

• GWPC Study: State Oil and Natural Gas Regulations Designed to Protect Water Resources
• Fox News ‘On The Job Hunt’: PA Marcellus Shale Development, Job Creation Featured on Fox
• Graphic: What’s In Frac Fluids?
• Detroit News Op-Ed: Prevent a cap on clean fuel
• Browner Memo: Letter of Support for Hydraulic Fracturing from Carol Browner, Fmr. EPA Administrator
• IBD Editorial: Get The Frackin’ Gas

What Lies Beneath

Energy In Depth digs deep into the substrata of U.S. code, separates fact from fiction in ProPublica’s latest dispatch

Here’s a question for you: What is a “well”? Is it a long, generally thin structural conduit used to secure physical access to sub-surface reserves of oil, gas, water and geothermal? Sure, it’s that. But for the purposes of regulation, it’s also considered any “dug hole” that’s “deeper than it is wide” – kind of like a hole you’d dig to stick a fence-post on your property, or one you’d need to install before setting up a basketball hoop in your driveway.

Of course, in digging that “well,” you better be careful how it’s classified. Under the federal Safe Drinking Water Act of 1974, the mere “subsurface emplacement of fluids” – a fancy phrase for “sticking stuff underground” – requires a permit from either the state Underground Injection Control office or the EPA, depending on the class of well involved.

But exactly into what class would a foundation hole for a basketball rim fall? Is it a Class I hazardous waste disposal well? Is it a Class II wastewater disposal well? Maybe a Class III disposal well for the solution mining of potash and sulfur?

Of course it isn’t. In reality, the reason you don’t need a federal permit to dig a 2-foot hole isn’t because it’s not considered a “well” (it is) — and it isn’t because you aren’t “emplacing” fluids within it (you are). It’s because the Safe Drinking Water Act has been interpreted for 35 years as a law to safeguard “public drinking water” from the permanent “disposal” of everything from hazardous wastes to mining salts. And as anyone who knows anything about energy exploration can tell you – that doesn’t describe either the purpose of hydraulic fracturing, or the effect. It’s a technique for liberating energy, after all, not disposing of waste.

Enter ProPublica’s Abrahm Lustgarten; for the uninitiated, someone “as expert on the topic [of fracturing] as anyone in America,” according to his editor. Earlier this week, Lustgarten published a piece in which he advances the following basic argument: Forget whether the water involved in the fracturing process is dangerous, and set aside whether its productive use in stimulating underground gas constitutes “permanent disposal.”  It’s all about the volume. And if operators leave even a drop of fluid underground, shouldn’t the EPA regulate it as underground injection?

At least, that’s how we’d paraphrase it. Here’s how he actually lays it out in the piece:

For more than a decade the energy industry has steadfastly argued …that the federal law protecting drinking water should not be applied to hydraulic fracturing … Now an important part of that argument — that most of the millions of gallons of toxic chemicals that drillers inject underground are removed for safe disposal, and are not permanently discarded inside the earth — does not apply to drilling in many of the nation’s booming new gas fields.

Now, to accept this point as legitimate, first you’d need to accept the idea that industry’s entire argument on hydraulic fracturing – namely, that states are best-equipped to regulate the technology – is rendered null and void in light of the supposedly earth-shattering revelation that some amount of water is left confined underground.

But haven’t we known about this reality for some time now – especially as it relates to the Marcellus? Is it possible that the Wilkes-Barre (Pa.) Times-Leader scooped ProPublica on this phenomenon in a story published more than 10 months ago?

When the rock is fractured, the liquid, known as fracing fluid, is pumped out, but only about half comes back, according to Thomas Beauduy, the SRBC’s deputy director. … DEP believes the water is segregated far enough away from groundwater to not be an issue.

The reality of the situation is this: Everyone knows that some volume of water will naturally remain confined underground; the geo-physical realities involved in fracturing a well allow for no other outcome.

But does that mean it’s dangerous? Absolutely not. Remember, we’re talking about a volume of liquid trapped nearly two miles beneath the surface – with thousands of tons of rock and several confining strata isolating it from potable drinking water above. And how do we know those confining strata will do their job? Because they’ve been doing their job for a million years now – not exclusively in preventing frac water from migrating to the surface, but in preventing the salty water that’s already down there naturally from penetrating our aquifers and ruining our drinking water.

Of course, Congress knows all this, and if it ever intended the Safe Drinking Water Act to extend beyond its original scope and cover the fracturing of energy wells, it certainly had plenty of chances to make that view known. Passed in 1974, SDWA has been amended a whopping eight separate times over the past 35 years (’74, ’77, ’79, ‘80, ‘86, ‘88, ’96, ‘05), but at no time during that extended run was the concept of regulating fracturing under the Act a significant component of the debate. And that’s true even though at the time of the bill’s passage in ‘74, fracturing had already been in commercial use for 25 years. 

What’s changed in 35 years? Not a whole lot on the technological side, with the notable exception of exciting advancements in horizontal drilling techniques that allow producers today to access 10 times the energy by drilling 1/10 the number of wells.

That should be universally hailed as a good thing, right? Unfortunately, for some groups, any technology that allows for greater access to fossil fuels – albeit the cleanest and most secure ones on earth – is rendered an object of fierce opposition. The tragedy of it all? Shale gas exploration in America not only has the potential to deliver hundreds of thousands of new jobs (when we need them most) and billions in annual revenue (when we need it most) – but it can help break our country’s dependence on foreign energy, and reduce the concentration of carbon in the atmosphere all at the same time.

Name us another energy source that can do all that. Now you understand what’s at stake.

Additional resources available at Energy In Depth:

• Send a Letter to DEC: Through the Energy In Depth portal, or (and?) via our friends from IOGA NY.
• Study: Potential Economic and Fiscal Impacts from Natural Gas Production in Broome County, NY
• Issue Alert: Gangs of New York
• Issue Alert: Sign of the Times
• Fact Sheet: HF Opponents Say the Darndest Things
• GWPC Study: State Oil and Natural Gas Regulations Designed to Protect Water Resources
• Graphic: What’s In Frac Fluids?
• EPA Study: Study to Evaluate the Impacts to USDWs by Hydraulic Fracturing of Coalbed Methane Reservoirs
• Browner Memo: Letter of Support for Hydraulic Fracturing from Carol Browner, Fmr. EPA Administrator

Countdown to DECision Day

As Dec. 31 comment deadline approaches, NY’ers decide
whether to leverage homegrown energy into jobs, revenue, security

WASHINGTON – In just two days, New York’s Department of Environmental Conservation (DEC) will formally close the comment period on the draft framework it released in September governing the safe exploration of natural gas from the Marcellus. The 804-page document carves out an aggressive regulatory path for overseeing the development of shale gas in the Empire State, which studies suggest could create hundreds of thousands of jobs for New York, and billions in annual revenue.

With two days remaining in the comment period, Energy In Depth’s New York petition page has already generated several hundred individual comments; our goal is to generate several hundred more before time runs out. Click HERE to access the page, or HERE to submit your comments through our friends at IOGA NY. The stakes, as laid out below, are enormous.

READ MORE

• IOGANY Release/Letter (12/29): Groups to Governor: Stay Committed to Natural Gas Exploration;
  **Click HERE to view the letter on-line
• Study: Potential Economic and Fiscal Impacts from Natural Gas Production in Broome County, NY
• Issue Alert: Gangs of New York
• IOGANY’s Brad Gill in the Buffalo News: “Gas exploration could bolster New York’s economy”
• Issue Alert: Sign of the Times
• Browner Memo: Letter of Support for Hydraulic Fracturing from Carol Browner, Fmr. EPA Administrator
• Graphic: What’s In Frac Fluids?

Energy In Depth: Today’s News

Hinchey calls for closer study before allowing Marcellus drilling. Press & Sun Bulletin. “U.S. Rep. Maurice Hinchey’s call to beef up the state’s proposal to oversee Marcellus Shale drilling is fueling more heated debate over the region’s multi-billion dollar fate in natural gas production. Hinchey submitted written comments to the state Department of Environmental Conservation last week. The agency is accepting comments on the plan, called the Supplemental Generic Environmental Impact Statement, until Dec. 31. … Chris Tucker, a spokesman for Energy In Depth, characterized Hinchey’s recommendations as superfluous. “Everything he writes in here related to disclosure, transparency, and water disposition has already been thoroughly covered by DEC,” he said. “I think if he ever gets around to reading it, he’ll be surprised at the degree of overlap.”

Marcellus shale fight heats up in New York. Oil & Gas Journal. “The Independent Oil & Gas Association of New York has urged Gov. David Paterson to remain committed to his draft State Energy Plan, which supports the expansion of natural gas exploration in the Marcellus shale. “We believe that New York cannot afford to turn away or postpone the tremendous opportunity for economic resurgence and a clean energy supply presented by the Marcellus shale,” IOGA said, along with a coalition of business and economic development groups. … “The extremely stringent requirements proposed by the SGEIS provide the public with the necessary oversight that natural gas exploration and extraction will be conducted in an environmentally safe manner,” the letter said.”

Backers of natural gas drilling press Paterson. Kingston Daily Freeman. “A coalition of business and economic development groups urged Gov. David Paterson on Tuesday to stick to the state’s draft energy plan, which includes support for natural gas exploration. The group — comprising the Independent Oil and Gas Association, The Business Council of the New York, the Independent Power Producers of New York, the National Federation of Independent Business and Unshackle New York — said in a letter to Paterson that natural gas exploration in the Marcellus Shale formation would not pose environmental dangers, as foes contend.”

Debate over Marcellus Shale drilling nears end. WSYR-TV. “There are just two days left to have your say in the state’s proposed regulations for natural gas drilling. If adopted, they’ll govern how companies would drill in the Marcellus Shale.  Drilling promises big money for the state but some say the environmental impact is too severe. … There is no reason for us to be buying Louisiana’s natural gas when we can drill under our own feet,” Tim Lattimore said. The former mayor of Auburn is part of a state-wide coalition that supports the drilling. “If we don’t do these things that are available to us if we don’t do anything to solve the high cost of energy in NY shame on us,” Lattimore said.”

Split over gas drill rules continues. Albany Times Union. “A coalition of business groups and a union representing state environmental workers added their voices to the debate Tuesday over proposed natural gas drilling in the state, with one urging Gov. David Paterson to push ahead and the other urging him to slow down. … In its letter to Paterson, the Independent Oil & Gas Association of New York and 16 other groups — including the chambers of commerce of Binghamton and Syracuse — wrote that the state should not “turn away or postpone the tremendous opportunity for economic resurgence and a clean energy supply.”

Will Governor Paterson Slow Down Natural Gas Drilling? WKTV. “A group of business and economic development groups across the state led by the Independent Oil and Gas Association of New York spoke out today as well, urging the governor to go forward with his energy plan saying, “We believe that New York cannot afford to turn away or postpone the tremendous opportunity for economic resurgence…and a clean energy supply… presented by the Marcellus shale. The extremely stringent requirements proposed by the SGEIS draft provide the public with the necessary oversight that natural gas exploration and extraction will be conducted in an environmentally safe manner.”

Natural gas operations in Piceance Basin slow; new technology helps eastern U.S. drilling grow. Grand Junction Sentinel. “The inherent difficulties of drawing gas from the Piceance Basin, though, have been conquered by advances in drilling and production techniques that allow energy companies to tap reservoirs of natural gas that were previously known, but considered unreachable. … In particular, the Marcellus Shale formation in the eastern United States has become more attractive as drillers have honed the art of punching multiple holes from single well pads, and service companies such as Halliburton, Schlumberger, CalFrac and others have learned to fracture formations several thousand feet down, freeing up gas that was otherwise unreachable, he said. “The Marcellus is the elephant in the room at the moment,” Bennett said. … There is gas in other shale formations, the Barnett of Texas, the Fayetteville in Arkansas and Haynesville in Louisiana.”

Study explores oil, gas potential of state lands. Louisville Courier-Journal. “Tapping state lands for oil and gas could raise as much as $15.4 million a year for the state, according to a study conducted by the Kentucky Geological Survey. The study envisions thousands of oil and gas wells on or next to more than 170 parcels of public lands across Kentucky, such as state forests, state parks, state wildlife management areas and properties owned by Kentucky universities. … “What the report does show, is under the right circumstances, there might be opportunities for agencies or universities to get some income to support their programs.”

Lehman Twp. confronts drill issue. Wilkes Barre Times-Leader. “After more than a year of rising interest in the Marcellus Shale just outside the county, Lehman Township supervisors will in January set the tone for natural-gas drilling in Luzerne County.  On Monday evening, the township’s planning board recommended approving a plan to drill a test well at a Peaceful Valley Road site. The vote on the conditional use now goes before township supervisors at their Jan. 20 meeting, at which they will also consider local concerns about groundwater contamination and road damage. “To the planning (board), it appeared that EnCana … answered those questions adequately,” said Raymond Iwanowski, the vice chairman of the board of supervisors, who was at Monday’s meeting. “As supervisors, we’re pretty united on this. We want to do it right.” 

Trans Energy digs 4th gas well in Marcellus shale. Associated Press. “Trans Energy Inc. has begun drilling its fourth natural gas well in the Marcellus shale in Marshall County. The company announced Tuesday that it has completed drilling the vertical portion of the well to a depth of about 6,500 feet. A second, larger rig is scheduled to drill the horizontal portion. Company President and CEO James K. Abcouwer says the company has drilled four vertical Marcellus wells and one horizontal Marcellus well in northern West Virginia.”

Canton FFA prepares for Farm Show. Towanda Daily Review. “In addition to the landscape display, the students have assembled a window display with the assistance of Fortuna Energy Inc. and Supervisor of Community Relations, Janice Lobdell. The display illustrates the process of horizontal drilling, how the process and company focuses on reducing overall environmental impacts, and the basic idea of protecting today while expanding for tomorrow.” He said the project was an entire year in the making, starting with a visit to the Fortuna Headquarters in Horseheads, N.Y. during the last school year.  ”A tremendous amount of work went into the display since the Troy Fair and it has been vastly improved,” he said.”

Energy In Depth: Today’s News

Drilling issue started quietly in Tompkins, then went out loud. Ithaca Journal. “The year started with just a relatively few activists from Shaleshock, a citizens’ coalition concerned about horizontal hydraulic fracturing in the Marcellus Shale, presenting at town meetings, writing letters to the editor, and trying to draw attention to an issue that was still under many people’s radar. … Hang’s report generated national attention, including an interview on the radio program “Democracy Now,” support from the National Resources Defense Council, and scorn from the gas industry lobbying group Energy in Depth, which sent out a press release in mid-December titled “Lies, Damned Lies, and Walter Hang’s Statistics.”

2007 story of the year: Barnett Shale, gas leasing became common themes. Fort Worth Star-Telegram. “In Tarrant County and much of North Texas, 2007 was the year that a once-obscure geological zone more than a mile underground, the Barnett Shale, became a topic of almost daily conversation. Natural gas drilling in the shale greatly expanded, reaching urban areas including long-established neighborhoods in Fort Worth, Arlington and other Tarrant County cities. Hundreds of landmen went door to door and thousands of North Texans signed gas leases every month, with bonuses being bid up dramatically.”

Environmental groups, natural gas companies debate impact of Marcellus Shale drilling. Pittsburgh Business Times. “There’s more to the Marcellus Shale boom than economic development and water concerns. There also are air quality concerns, says a growing chorus of environmental groups. With matched enthusiasm, industry companies are rushing to dismiss the claim. … Chesapeake Energy Corp.’s spokesman Dave Spigelmyer said the whole air pollution concern is “unfounded,” adding, “we welcome air testing at our well site locations to prove that claim.” “They’re making the case that they have all this truck traffic emitting fuels, but we have much more emissions fumes from diesel buses,” he said.”

2009 a pivotal year for Marcellus drilling, but to which way? Elmira Star-Gazette. “Even without a single well drilled in 2009, the Marcellus Shale continued to be at the center of a polarizing debate about visions for the future in the southern Finger Lakes and Southern Tier. The state Department of Environmental Conservation took longer than expected to complete an environmental review of risks associated with drilling. Without a final regulatory framework to deal with unique issues related to Marcellus production, no permits were issued in New York, although drilling ramped up in Pennsylvania.”

Lehman Twp. one step closer to gas drilling. Citizens Voice. “Lehman Township’s planning commission voted Monday to recommend the supervisors allow two natural gas companies to move forward with their application to drill one of Luzerne County’s first gas wells – as long as they address specific concerns. WhitMar Exploration Co. and EnCana Oil and Gas Inc. want a conditional use permit to drill a well on an agricultural property they leased on Peaceful Valley Road. … When the drilling is finished, a series of tests will be done to determine how much natural gas is there. … “If things look promising – if they find what they want to find – the next step is the hydrofracture,” Burns said. The process, also called “fracking,” involves blasting water deep underground to break up the shale and release the gas.”

Spectra Reaches Pacts to Expand Two Projects. Wall Street Journal/Dow Jones. “Spectra Energy Corp. said Monday it signed binding agreements to expand two major projects, saying a proposed pipeline would be capable of transporting up to 800 million cubic feet per day of new natural-gas supplies. The commitment by Chesapeake Energy Corp., Consolidated Edison Inc. and Statoil ASA would provide “critically needed gas supplies to the New Jersey and New York area,” Spectra said Monday. It expects service to begin in the fourth quarter in 2013. Spectra spokeswoman Toni Beck said the company hadn’t completed an estimate for a price tag on the expansion plans at this time. She said the proposed expansion would add a number of jobs—primarily in the construction phase.”

Spectra signs New York, New Jersey pipeline deals. Reuters. “Pipeline company Spectra Energy Corp said on Monday that it signed binding deals to expand two existing pipeline systems to deliver natural gas to markets in New York and New Jersey. Spectra’s agreements with Chesapeake Energy Corp, Consolidated Edison Inc and Statoil ASA will let it expand its existing Texas Eastern and Algonquin pipeline systems, the Houston company said. Chesapeake and Statoil are joint venture partners developing the Marcellus Shale gas field in the U.S. Northeast. The Marcellus Shale is said to hold vast amounts of natural gas, but it needs more infrastructure to transport the fuel to market.”

Pipelines to expand to carry Marcellus Shale gas to NY City. Associated Press. “Chesapeake Energy says it’s partnering with Spectra Energy to expand two pipeline systems to carry natural gas from the Marcellus Shale region to New York City. Under the agreement, Spectra will expand the Algonquin and Texas Eastern pipeline systems, including 16 miles of 30-inch pipeline from Staten Island to Manhattan. The Marcellus Shale region under New York, Pennsylvania, and parts of West Virginia and Ohio is 1 of the largest natural gas fields in the United States. Energy companies are eager to begin drilling in the region in New York but development is on hold until new regulations are approved.”

Proposal for natural gas storage debated in St. Mary Parish. Times-Picayune. “A natural gas storage company and a salt mine operator are at odds over a proposal to build four natural gas storage caverns in St. Mary Parish. Ranger Gas Storage/Henry Gas Storage LLC wants to store natural gas in salt domes on Cote Blanche Island because of the area’s proximity to major gas pipelines and to capitalize on the huge volumes of natural gas that are expected to be produced from new finds such as the Haynesville Shale in north Louisiana.”

Energy services sector holds the champagne. Calgary Herald. “Predictions of better times for drillers and other oil and gas service companies in 2010 are fading fast as a dismal 2009 comes to a close. Particularly in Western Canada, where conventional natural gas is still the bread-and-butter target for most energy companies, sagging commodity prices have put a damper on spending plans that many observers had expected earlier in the year would begin to recover. … Most of the service sector jobs that could be shed were cut during 2008-09, but observers say companies will continue to try to trim costs where they can and older, general purpose equipment will continue to be parked in backlots as companies chop away at prices to keep cash flowing.”

Energy In Depth: Today’s News

Get The Frackin’ Gas. Investor’s Business Daily, Editorial. “While the technique is not new, the technology exploiting it is. XTO has helped develop new technologies that let it drill a single well 9,000 feet and then bore horizontally through shale formations to unlock the natural gas trapped in the porous rock. The rock is fractured and the gas is pushed into accessible pockets whence it can be extracted with a minimal surface footprint. Because of these new technologies, it is estimated that the U.S. sits on 83% more recoverable natural gas than was thought in 1990.”

Duncan firm develops eco-friendly wastewater treatment. Journal Record. “A3Environ Inc. has developed a way to treat water used in hydraulic fracturing drilling – commonly referred to as “flowback” and “frac”– with a patented advanced oxidation process to eliminate dangerous chemicals, President Jay Glasscott said. … The FRAC Act was introduced in both houses of Congress last summer. If passed, the legislation would reclassify wastewater from hydraulic fracturing and put it under EPA regulations, the American Petroleum Institute representatives have said. It would also increase the cost of developing natural gas fields, the institute said, as millions of gallons of freshwater are used in shale wells.”

Fracking support company looks to set up shop in Kirkwood. Press & Sun-Bulletin. “Rain for Rent, a fracking-support company from California, plans to open a branch in Kirkwood to be in the thick of Marcellus Shale development. … The gas-rich formation, heralded as a major future domestic energy source, runs from the Southern Tier through the Appalachian Basin. … The plan represents the latest vote of confidence that Marcellus development will soon overcome regulatory hurdles that have stalled production in New York. … Rain for Rent rents equipment to store, mix and handle fluids to stimulate natural gas production with a process called hydraulic fracturing — fracking for short.”

Gas well exceeds expectations. Buffalo News. “National Fuel Gas Co.’s third natural gas well in the lucrative Marcellus Shale region in northwestern Pennsylvania is starting out as the best yet. The Amherst-based energy company’s third well under its own drilling program yielded far better results than the strong production National Fuel initially realized from its first two wells in the region. … The strong early results from National Fuel’s drilling efforts on the more than 720,000 acres it controls in northwestern Pennsylvania have prompted the company to speed up its plans to drill new wells in the Marcellus Shale.”

Local economies look for boost from natural gas exploration in region’s Marcellus shale. Olean Times Herald. “The Marcellus shale looks more and more like a lucrative piece of the northcentral Pennsylvania pie. … Development of the Marcellus shale is expected to create more than 98,000 jobs and contribute upwards of $14 billion to the state’s economy in 2010, according to a recent report by Pennsylvania State University. “We’re starting to come to terms with the enormity of the Marcellus shale gas issue,” said Paul Heimel, a Potter County commissioner and co-chair of the county’s Natural Gas Task Force, on Monday. “We’re learning more every day. … “Economically, we are seeing the tip of the iceberg already in Potter County in several ways,” Mr. Heimel added.”

Devon selling Gulf properties for $1.3 billion. Fort Worth Star Telegram. “The revitalization of interest in U.S. onshore drilling has been fanned by technological advancements that have greatly increased the potential output from domestic oil and natural gas deposits. The most notable example of that is drilling for natural gas in areas such as the Barnett Shale, which has been made possible by advanced horizontal drilling and hydraulic fracturing technologies.”

FACTBOX: Shale gas stirs energy hopes, environment concerns. Reuters. “Shale gas is natural gas — largely methane — produced and stored in shale formations a mile or more underground in many of the lower 48 U.S. states. Together with other “unconventional” natural gas sources (tight sands and coalbed methane), shale gas accounts for 60 percent of technically recoverable U.S. onshore reserves, according to the Department of Energy. At least half of new reserves growth is expected to come from shale gas by 2011. In all, shale reserves are estimated to contain enough gas to meet total U.S. demand for 26 years.”

Seneca Resources well tops 10 million cubic feet. Associated Press. “Natural gas and oil company Seneca Resources Corp. said Tuesday that its third Seneca-operated horizontal well in the Marcellus shale in Tioga County, Pa., flowed at an initial 24-hour rate of more than 10 million cubic feet per day and averaged 9.5 million cubic feet over seven days. … With two rigs running, Seneca plans drilling 50 to 70 horizontal wells during fiscal 2010, including those operated by EOG Resources in a joint venture with Seneca.”

DeSoto Police Jury proposes $60M budget. Shreveport Times. “The proposed 2010 budget that DeSoto police jurors will vote on in January increased 100 percent over this year’s budget. The significant bump in revenue and expenditures totaling $60 million can be tied to the Haynesville Shale and its related activity throughout the parish. Sales tax revenue reached a record level this year — $13.9 million through November compared to $6.9 million in 2008. The extra funds are allowing for more road projects and increased library services, while also putting more money into the solid waste and jail funds.”

Belle Vernon Area School board to seek gas drilling offers. Pittsburgh Tribune-Review. “The Belle Vernon Area School Board this week decided to seek offers for natural gas drilling on two tracts of land. Board President Dale Patterson said a few companies contacted the district to inquire about drilling on a 6.9-acre parcel near the Multiplex facility and a 2.8-acre parcel near a former bus garage.”

Energy In Depth: Today’s News

Gas regulations comprehensive. Ithaca Journal, EID’s Lee Fuller. “A recent article tells the story of resident Walter Hang’s effort to enlist famous movie stars and renowned spiritual leaders to fight DEC’s proposed draft regulations governing the safe and responsible exploration of natural gas in New York. But before your readers join that campaign – one that fundamentally seeks to derail the DEC and prevent private landowners from developing resources on their own land – it might be worth examining what’s in the DEC document. The regulatory framework handed down in September ranks among the most comprehensive in the nation.”

Gas exploration could bolster New York’s economy. Buffalo News, IOGA-NY’s Brad Gill. “It’s important to understand first that natural gas exploration is not a phenomenon new to our state. The first commercial gas well in the world was developed just 50 miles south of Buffalo nearly 190 years ago, and New York today is home to more than 14,000 producing wells, each of them tightly regulated by the state. What’s different with the Marcellus Shale? For starters, it’s massive, by some estimates, holding as much as 516 trillion cubic feet of natural gas. And as our friends from Pennsylvania have shown us, it’s an economic game-changer as well.”

A bright future for gas is good news for state. The Oklahoman, Editorial. “We could say the “moment” for natural gas came a long time ago in Oklahoma. It’s been one of the cylinders in the economic engine for years, but gas producers have long said the fuel has so much more potential. And there’s apparently so much more of it than most people thought. … Regardless of how this plays out, gas has a brighter future. That’s good news for the Oklahoma economy. And, if the price is right, it’s great news for state revenues. Gas-producing states stand to benefit from increased demand and increased diversity in what drives that demand, including fuel for automobiles.”

ND leads 3-state region in oil, gas leases. Associated Press. “Federal oil and gas lease sales in the Dakotas and Montana set a record in fiscal 2009, with parcels in western North Dakota’s booming oil patch accounting for the overwhelming bulk of interest, the Bureau of Land Management said Monday. Oil and gas lease sales in the three states totaled $75.4 million during fiscal 2009, which ended in September, said Greg Albright, a BLM spokesman in Billings, Mont. … Most of the leases in North Dakota were within the rich Bakken shale formation in the western part of the state, Albright said. “People love the Bakken,” Albright said. “It’s all market driven.”

American Shale Gas Revolution Threatened By Fracking Environmentalists. Business Insider. “A key natural gas drilling technique, known as hydraulic fracturing or ‘fracking’, is under fire due to environmental concerns in North Texas. … The technology is so important that Exxon (XOM) has even threatened to walk away from their acquisition of natural gas producer XTO Energy (XTO) should harsh regulation be enacted.”

Will natural gas rescue American energy policy? HotAir.com’s Ed Morrissey. “Is the answer to bridging American energy policy from a petroleum economy to a renewables future under our very noses — or more accurately, under our feet?  The Obama administration wants to impose a punishing cap-and-trade system onto the US to restrict carbon-dioxide emissions, but a plentiful energy source with at least decades of supply and inexpensive price could both lower emissions and reduce dependence on foreign oil.”

Are Congressional Democrats Aiming To Shut Down The Natural Gas Industry? The Hayride. “But the XOM/XTO deal has a rather peculiar caveat to it – it’s subject to what the government might do to the natural gas industry. Specifically, the language of the merger deal refers, in the definitions of a “Materially Adverse Effect,” to the potential outlawing of hydrauling fracturing, or “fracking,” as a condition which would break the sale. That a ban on fracking would show up not once but twice in the agreement is a testament to the fear the two sides have over what the government might do to their business.”

Exxon venture may be prelude. Charleston Daily Mail. “Corky DeMarco, executive director of the West Virginia Oil and Natural Gas Association, said, “When a company of the stature of Exxon Mobil comes in and spends $41 billion for natural gas holdings, including some in the Appalachian Basin, it legitimizes the fact there is 500 trillion cubic feet of gas, that the potential is here and the opportunities are here.” … But the big change came a few years ago when geotechnical engineers figured out how to drill down into shale and then go sideways to open a much bigger area of gas-bearing formations. They inject a mixture of water and sand into the well at high pressure, creating multiple fractures throughout the shale, freeing the trapped gas to flow into the well.”

Ultra Petroleum To Pay $400M To Expand Marcellus Shale Land. Wall Street Journal/Dow Jones. “Ultra Petroleum Corp. (UPL) will acquire about 80,000 acres in the Pennsylvania Marcellus Shale region for roughly $400 million from an unidentified private company. Energy companies have been beefing up their shale gas holdings despite low natural gas prices, betting that they will be critical to growth as the economy recovers. Exxon Mobil Corp.’s (XOM) planned acquisition of XTO Energy Inc. (XTO) has been viewed as the biggest endorsement yet for shale gas production in the U.S. and abroad.”

Energy In Depth: Today’s News

Not a great model. Towanda Daily Review, EID’s Jeff Eshelman. “For those looking for facts on local efforts to leverage the area’s abundant reserves of clean-burning natural gas into new jobs and opportunity, the Dec. 3rd edition of the Daily Review wasn’t a whole lot of help. On the news page, we learn that a commonly used energy technology known as hydraulic fracturing is “exempted” from regulation thanks to a loophole in current law – information the reporter admits was taken directly from a politician’s personal Web site. The reality is that no such exemption exists; fracturing has been regulated by the states for more than 60 years now, has been applied to more than 1.1. million wells, and has not once been credibly tied to the contamination of drinking water.”

Analysts: Marcellus to produce fuel of choice. Elmira Star-Gazette. “Marcellus Shale gas will contribute to landmark changes to energy markets facing the age of global warming. … “There is broad recognition that we will be living in a carbon-constrained world,” said Chris Tucker, a spokesman for Energy In Depth, a Washington based trade group. “This is the direction that everybody is moving in.” New technology, including horizontal drilling and hydraulic fracturing, has allowed efficient production from gas-rich rock formations that was not feasible a decade ago. … “It’s completely changing the entire dynamic,” Tucker said. “The reports written before the shale boom can be thrown out.”

Natural gas boom headed for Luzerne County. Scranton Times-Tribune/Citizens Voice. “The start of natural gas drilling in Luzerne County will come with issues such as where the companies will get water for the process, what they will do with it afterwards, and whether they will take steps to mitigate infrastructure wear and prevent water contamination. … Companies use a process called hydraulic fracturing or “fracking,” in which millions of gallons of water are blasted deep into the ground to break up the shale and release the natural gas. “With any kind of shale play, you have to use fracking. That’s really the type of technology that makes it viable,” Mr. Hock said. In order to be used for fracking, the water is conditioned with chemicals and fine-grain sand, Mr. Fox said. About 85 percent of the water stays underground, but the remaining 15 percent is heavily impregnated with salts and has to be treated.”

Gas ‘gold rush’ ignites in rural New York. AFP. “After a lifetime struggling to make money from the land, New York farmer Bill Graby has discovered he’s sitting on treasure — possibly the biggest natural gas deposit in America. “It’s like winning the lottery,” says the 6.6-foot (two-meter) dairy farmer from the picturesque town of Callicoon in the Catskills hills. The deposit, called the Marcellus shale, stretches all the way from New York to Tennessee, containing 168 to 500 trillion cubic feet of natural gas, according to New York State’s Department of Environmental Conservation. … “The size is potentially tremendous for the nation as a whole,” John Felmy, chief economist for the American Petroleum Institute, told a Pennsylvania College of Technology conference last month.”

Model for mining safely. Ithaca Journal, Op-Ed. “There are currently several shale areas with thousands of wells, in the United States and Canada, that prove that competent people employed by responsible companies, using today’s technology, can drill and “frack” wells safely and with no impact on the environment. In the Fort Worth area, they have wells under residential neighborhoods. They have wells that can be seen from a golf course. They have wells next to lakes and streams. They have an economy that most of us wish we had. Where did the Valley of Opportunity go – and whose empire is the Empire State?”

Sierra Club’s Pro-Gas Dilemma. Wall Street Journal. “When energy companies began preparations to drill for natural gas in upstate New York last year, the local Sierra Club quickly organized against them. … Grassroots groups have sprung up across the country to raise environmental concerns, particularly about the alleged risk of drinking-water contamination from hydraulic fracturing, a process in which large volumes of chemical-laced water are injected down wells to release gas trapped in underground rock formations. Companies say that their drilling practices, including hydraulic fracturing, are safe, and that existing regulations are sufficient. There have been few independent studies to assess how widespread problems are.”

Gas could be the calvary in global warming fight. Associated Press. “An unlikely source of energy has emerged to meet international demands that the United States do more to fight global warming: It’s cleaner than coal, cheaper than oil and a 90-year supply is under our feet. It’s natural gas, the same fossil fuel that was in such short supply a decade ago that it was deemed unreliable. It’s now being uncovered at such a rapid pace that its price is near a seven-year low. Long used to heat half the nation’s homes, it’s becoming the fuel of choice when building new power plants. Someday, it may win wider acceptance as a replacement for gasoline in our cars and trucks.”

Ideas, solid leadership put local firms on Santa’s list. Fort Worth Business Press, Op-Ed. “Fort Worth firms appear to be the on the shopping list of companies and people flush with cash this Christmas season. … Here’s one example of taking a great idea and executing: XTO Chairman Bob Simpson and XTO Energy didn’t invent the idea of using horizontal drilling and fracing to crack the secrets of the Barnett Shale.  But XTO Energy certainly has done a great job perfecting ways of finding and developing shale assets. When XTO Energy began building its shale assets, it was known as “unconventional” gas. With the validation of its shale strategy by Exxon Mobil, I think we may soon retire the “unconventional” moniker.”

Lies, Damned Lies, and Walter Hang’s Statistics

Ithaca activist scores lots of coverage over claim of “270 oil and gas spills in New York” – but what do the data ACTUALLY say?

Walter Hang knows his way around a government database. And it’s a good thing he does. As president of the Ithaca, N.Y.-based Toxics Targeting, Inc., Mr. Hang’s entire business depends on being able to access and track all sorts of state, local and federal environmental data, and then distill that information into accurate, up-to-date reports for his customers. So when Mr. Hang released a report last month listing “270 oil and gas spills” in New York over the past 30 years, data he derived from government sources, the public took notice. And the media did too.

A lot of notice. A quick internet search for “Walter Hang” and “270” returns more than 1,000 individual media and blog mentions, including prominent pieces in several area newspapers, plenty of extended radio spots, and on local television from far Upstate to the Southern Tier.

And to his credit, Mr. Hang gives a great interview. His argument, always impassioned, goes something like this: “DEC’s own data,” found right here in my report, prove that oil and gas exploration is unsafe; DEC has severe “regulatory shortcomings” and cannot be trusted to oversee shale gas exploration; and finally, the draft DEC regulatory document governing the Marcellus is “inadequate.” It cannot be fixed. It cannot be amended. It can only be destroyed. My report – have I mentioned that? – well, it proves it.

In reality, it’s not much of a “report” at all. Found here on Mr. Hang’s website, it appears simply to be a compilation of incident sheets downloaded directly from DEC’s spill database (available for public search here) and marked up furiously with a highlighter. But what do the numbers actually say? Well, Energy In Depth took a look at the data — for real this time. And what we found might just knock you off your chair.

First, let’s have Mr. Hang set the baseline for us:

“I just posted data at [on my website] for 270 oil and gas spills in New York State that have caused fires, explosions, home evacuations, polluted drinking water wells as well as long-term impacts on forests, streams, wetlands, ponds and other waterways.”

270 oil and natural gas spills – a claim, remember, that Mr. Hang makes in support of his larger argument that DEC cannot do, and indeed has not done, an “adequate” job of regulating the exploration and production of oil and natural gas in the state of New York.

Now let’s compare that assertion with the actual facts: 

Total number of spills over past 30 years, across entire state, related to oil and natural gas exploration & production: 161 (not 270)

Total number of spills documented in DEC’s database over the past 30 years: 354,615

Percentage of total spills tied to oil or natural gas exploration: 0.045% (45 thousandths of one percent)

Number of incidental spills reported over same period at gas stations (and in no way related to oil or gas exploration): 30,122

Catch all that? The process of exploring for, and eventually producing, oil and natural gas in New York over the past three decades is responsible for one-forty-thousandth of one percent (!) of the total spillage recorded over that time. Still too high? Let’s take a look at the numbers just for natural gas:

Number of DEC-recorded spills tied to the exploration or production of natural gas: 45

Out of a total, 30-year spill total of: 354,615

For a total spill percentage of: 0.0123%

It’s important to keep in mind here that New York is not Rhode Island. New Yorkers have been producing natural gas in their state longer than anyone; indeed, the world’s first commercial gas well was developed in Fredonia nearly 190 years ago. Today, the state supports more than 14,000 individual natural gas wells. And over the past 30 years, those wells have delivered more than 800 billion cubic feet of natural gas to consumers in New York and elsewhere.

We’ll say it again: More than 800 billion cubic feet of natural gas in 30 years. And in that time – 45 spills.

From where do the remaining 354,000 spills originate? Let’s run through the list: 

100,929 (28.5%) — commercial/industrial sites

69,719 (19.7%) — residential (private dwelling) sites.

63,121 (17.8%) — transportation (automobile, railroads, trucks)

35,072 (9.9%) — institutional sites

30,122 (8.5%) – simple spills at gas stations.

No one should doubt Mr. Hang’s sincerity and passion, and certainly no one can discount his ability to organize a crowd. Indeed, according to reports, Mr. Hang has secured more than 6,000 signatures from folks who apparently believe, like he does, that natural gas exploration is responsible for hundreds of catastrophic spills over the past 30 years, and is bound to account for many, many more in the future. His report “proves” it.

But as our analysis indicates, one that is easily corroborated by simply taking the time to look through the sheets, Mr. Hang’s well-publicized efforts to target and eliminate sources of oil and gas spillage in New York would be more appropriately directed at several other places: starting with his local gas station, and extending all the way through to his office space. Now that’s a report we’ll be anxious to read.

In the meantime, we’ve got jobs to create, revenue to generate, and a public comment period to show up for – one that closes in 13 days. Click here to make your views known to DEC. And here to keep up on what’s going down.

Energy In Depth: Today’s News

Congress to EPA: be careful on that new frac study. Houston Chronicle. “The Environmental Protection Agency said earlier this year it would do another review of hydraulic fracturing, the method being used more widely throughout the U.S. to tap into natural gas shale formations. The move comes, in part, in reaction to concerns about use of the technique. While the Obama administration has started to make more positive noises about the future of natural gas moving forward, a group of 22 Democratic members of Congress sent a letter to EPA head Lisa Jackson on Tuesday with some advice on the study, just in case.” NOTE: Click HERE to view this letter on-line.

Gas industry economist touts Marcellus Shale development, counters environmental concerns. Scranton Times-Tribune. “Natural gas production from the Marcellus Shale promises to boost employment and the economy in parts of Pennsylvania where “economic opportunities are just abysmal,” the chief economist of the American Petroleum Institute said Tuesday. John Felmy, Ph.D., a Pennsylvania native, touted the promised economic benefits of gas extraction at a meeting with The Times-Tribune editorial board while countering what he called the “real misinformation put out by folks” critical of the environmental cost of the drilling. “It is not hydraulic fracturing itself that is causing any problems.”

Markey calls for hearing on Exxon deal. E&E News. “A spokesman for Energy In Depth, an industry-backed group, said an Exxon-XTO deal shows confidence in the hydraulic fracturing drilling technique required to extract natural gas from unconventional resources, like shale. But he did not support Markey’s decision to hold a hearing on the purchase. “Either the chairman’s recently taken up an interest in antitrust law, or he plans to use this hearing as a platform to attack one of the safest, most critical technologies used in the development of American shale gas today,” said Chris Tucker, the spokesman for Energy In Depth. “Responsible shale gas exploration could help us kill two birds with one stone here — it should be the belle of the ball. Instead, it’s rendered as just another thing to demagogue.”

Gas drilling our best option. Albany Times Union, Op-Ed. “Fifteen years ago, no one in the United States, or in North Texas for that matter, had ever heard of the Barnett Shale — except maybe a few geologists. Today, it’s the largest natural gas field in the United States, producing four billion cubic feet a day. It supports thousands of jobs and generates millions in tax revenue. … Hydraulic fracturing has been used in nearly one million wells across the United States. Nonetheless, careful studies by the Environmental Protection Agency and the Ground Water Protection Council haven’t revealed a single case of drinking water contamination from shale gas drilling. That’s because the fracturing occurs far below the location of drinking water, and the gas wells are encased in steel and concrete to ensure isolation from ground water.”

Markey calls for Exxon/XTO merger hearing. Houston Chronicle. “Rep. Ed Markey (D-Mass.), chairman of the Energy and Environment Subcommittee of the Energy and Commerce Committee is calling for a special hearing into the planned merger between Exxon Mobil and XTO Energy. … No doubt issues like environmental concerns over hydraulic fracturing are part of the reason. But there’s also the issue of natural gas as a power plant fuel which, as a helpful reader at EnergyInDepth.org pointed out, Markey believes is a key fact of life moving forward.”

Possible Drilling Already Paying Off Big In Wheeling. WTRF-TV. “The city of Wheeling and the Wheeling Park Commission each received $386,629 dollars to let Chesapeake Appalachia Drill for natural gas at Oglebay Park. Now, despite some concern about environmental problems, Wheeling City Manager Bob Herron said he think the benefits should outweigh the risks. “Whether or not Chesapeake Drills or not the city and park have received money and ultimately if they do drill there gas production royalties are set at 14 percent,” said Herron.” NOTE: The Associated Press also reported on this.

Exxon’s Bid Spotlights Bright Future for Natural Gas. New York Times. “After quietly grabbing up unconventional natural gas reserves for years, Exxon Mobil Corp. moved boldly yesterday to buy one of the largest U.S. independent gas companies, XTO Energy, in a deal valued at $41 billion. … Over the past decade, Exxon Mobil has built up its reserves of unconventional natural gas resources like shale gas, tight gas and coalbed methane, which could hold decades of energy supplies but have historically been difficult to extract. New technological developments, like those developed and employed by XTO, have allowed such plays to become a viable part of the global energy mix.”

Marcellus shale gas drilling planned in North Fayette. Pittsburgh Post-Gazette. “The North Fayette planning commission last night heard plans for drilling and extracting natural gas from the Marcellus shale. Representatives of Oklahoma-based Chesapeake Energy outlined plans to drill two gas wells on land leased from Champion Processing Inc., bordered by state Route 980 and Steubenville Pike. The site is located in an industrial zone about 1,000 feet from the Washington County line. “The Marcellus is a really good shale, and they really have high expectations for it,” Chesapeake representative Dave McDougal said after the meeting.”

Exxon Mobil-XTO merger is Big Oil’s largest venture into U.S. natural gas. Fort Worth Star-Telegram. “Energy industry analysts said Monday that other independents who have made their mark in recent years by successfully drilling and producing gas from the Barnett Shale and other big new U.S. gas fields could find themselves being courted by the likes of a Chevron or Shell. … The chief executive of Royal Dutch Shell, Peter Voser, recently said his company will boost gas to half of the company’s total production by 2012. “In the United States, new technology has opened up abundant gas resources contained in dense rock formations, increasing supplies dramatically,” Voser said in speech reported by Oil & Gas Journal. “So you can see why I’m sometimes tempted to say: Nothing beats natural gas.”

Range finishes third phase of natural-gas-processing infrastructure expansion. Fort Worth Star-Telegram. “Fort Worth-based Range Resources Corp. just keeps getting bigger in the hot Marcellus Shale natural gas play in the Appalachian region of the eastern United States. Range, which is heavily focused on its extensive Marcellus lease holdings in southwestern Pennsylvania, announced Monday the completion of a third phase of expanding its natural gas processing infrastructure that will enable it to wring greater sales of valuable natural gas liquids from its wells. … Range Chairman John Pinkerton praised MarkWest Energy Partners for “doing a terrific job building out gas-processing infrastructure for our Marcellus production.”

Gas companies to set up drilling operations in NEPA. Citizens Voice. “By May, ground could be broken for the first operating natural gas wells in Luzerne County. Two Denver, Colo.-based companies, EnCana Oil and Gas Inc. and WhitMar Exploration, have taken out 875 leases on approximately 25,000 acres primarily in Lehman, Lake, Jackson, Ross and Fairmount townships, but also in Dallas, Hunlock, Huntington, Union and Plymouth townships. … “We take protecting the environment very seriously,” Wiedenbeck said. “We understand people have concerns, and we take every step to protect the community, and every step to protect the environment.”

Drilling firm explains safeguards. Wilkes Barre Times-Leader. “In an attempt to become amenable neighbors, EnCana Oil and Gas is making a two-stop informational tour in the region where it has purchased gas-drilling leases. It started Tuesday evening at the Lake-Lehman Junior/Senior High School, where about 300 people showed up, according to representatives of the first company to have a physical presence in Luzerne County. Residents are invited to discuss drilling practices, environmental concerns, water use and to view a map of the exact properties that are leased.”

Range Resource says Marcellus ‘09 production quadruples. Reuters. “Range Resources Corp said its net production from the Marcellus Shale almost quadrupled to hit the high-end of its 2009 outlook, and the independent oil and gas company set its exit production rate for 2010 and 2011. The company said production from Marcellus has reached 100 million cubic feet of natural gas equivalent per day, compared with its production forecast of 80 to 100 Mmcfe net per day for 2009.”

Has Natural Gas’s Moment Come? Wall Street Journal. “After a decade-long wild ride, North American natural-gas prices seem to be entering a period of stability, which is likely to change the way Americans heat their homes, generate their electricity and maybe even fuel their cars. Gas producers have been arguing for some time that new sources of the fuel have made it both plentiful and reliable. … The abundance of gas is largely thanks to a new technique to unlock dense rock first tried successfully in the 1990s and early 2000s in the Barnett Shale under Fort Worth, Texas. Riding this success and fueled by cheap financing, energy companies fanned out across the U.S. in search of new fields.”

Governor issues state energy plan focusing on cleaner power. Ithaca Journal. “Gov. David Paterson announced a 10-year energy plan for the state Tuesday that officials vow will create tens of thousands of job and provide a blueprint to build a clean-power economy across New York. … It also estimates the state’s natural gas production will double in 10 years with development of the Marcellus Shale, the massive gas reserve running under the Southern Tier and Pennsylvania. That estimate is “conservative,” the plan states, “to account for potential permitting and production difficulties related to horizontal drilling, and hydraulic fracturing. … Marcellus production levels could potentially be much higher.” NOTE: Click HERE to view the plan on-line.

Energy In Depth: Today’s News

Marcellus Shale Coalition Issues Statement Regarding Support for Responsible Natural Gas Development in PA. Release. “The Marcellus Shale Coalition (MSC) today underscored its commitment to economic development, environmental protection, and best management practices in the responsible development of Pennsylvania’s vast natural gas resources. “There are a lot of groups and organizations interested in learning more about the Marcellus Shale — beyond the vast economic opportunities, to include an understanding of the best management practices and further refinements that can allow the Commonwealth to develop the resource in balance with the environment.”

The rise of unconventional U.S. natgas production. Reuters. “There are three main unconventional gas resources; Shale Gas found in very fine-grained sedimentary rock, Tight Gas or gas that is stuck in a very tight formation underground, and Coalbed Methane as a by-product of coal production. Shale gas is the fastest growing of the unconventional plays. … Advances in technologies such as horizontal drilling has allowed unconventional gas producers to drill multiple wells for from one well pad. Rock fracturing, or fracking, techniques have also made production of shale deposits more viable. Fracking involves blasting rock with a mixture of water, sand and chemicals.”

Exxon Mobil-XTO merger is Big Oil’s largest venture into U.S. natural gas. Star Telegram. “In the United States, new technology has opened up abundant gas resources contained in dense rock formations, increasing supplies dramatically,” Voser said in speech reported by Oil & Gas Journal. “So you can see why I’m sometimes tempted to say: Nothing beats natural gas.” Analysts said the work done by the likes of XTO, Devon and others in unlocking gas from the Barnett using horizontal drilling and fracturing of the dense rock makes them attractive to the majors. They have already leased drilling rights to vast amounts of gas-rich acreage and have the expertise to exploit it.”

In Exxon Deal, Signs of the New Gusher. New York Times. “The purchase allows Exxon to expand in shale gas, an area that has seen tremendous growth, and increase its gas resources by 45 trillion cubic feet, roughly equivalent to two years of domestic demand. … “These unconventional resources are going to take on an increasing role in our energy needs,” said Daniel Yergin, the chairman of IHS Cambridge Energy Research Associates, a consulting firm, adding that the interest of large oil companies in shale gas was fairly recent. “This demonstrates how important natural gas is now, seen as part of the mix for a low-carbon future.”

Carney comments on FRAC Act. Towanda Daily Review. “U.S. Rep. Chris Carney said it’s still too early to tell whether the Fracturing Responsibility and Awareness of Chemicals (FRAC) Act is needed. … ‘Ensuring our community has safe drinking water in the midst of our natural gas boom is of significant concern to me and my staff. I supported legislation this year that directs the Environmental Protection Agency to further study the relationship between hydraulic fracturing and drinking water and to determine whether the process requires federal oversight. I look forward to reviewing that analysis.’”

New technology helps treat waste water in Marcellus Shale operations. Pittsburgh Tribune-Review. “Two local companies involved in the natural gas industry are expecting SteelWater to run deep — about 6,000 feet deep below the surface in the Marcellus Shale Basin where the thousands of gallons of water used each day to produce gas must be disposed of in an environmentally safe way. SteelWater is the name of a joint venture by BLX Inc. and CWM Environmental Inc. that has partnered with a New Mexico company, Altela Inc., to use Altela’s patented technology to help solve the water issues associated with developing gas in this region. The gas trapped in the Marcellus Shale formation, which runs 600 miles through Ohio, West Virginia, Pennsylvania and New York, is a growing industry in Western Pennsylvania.”

Let DEC process play out. Elmira Star-Gazette, Editorial. “The end of 2009 closes out the public comment period on a current draft of controversial natural gas drilling regulations. But it’s hardly the end of this long-simmering debate over when and under what conditions New York will allow horizontal hydro-fracturing. Everyone with a stake in this matter, from landowners to gas companies to defenders of the environment, need to keep that in mind. … Those who stand to profit from drilling into the gas-laden Marcellus Shale in the Southern Tier are themselves antsy, but for a different reason. They want the regulations to be enacted soon so that wells can produce income for them and a stimulus for the sluggish upstate economy.”

Book Says XTO Deal Helps Exxon, Sees More Consolidation. Bloomberg-TV. “Kevin Book, managing director at Clearview Energy Partners LLC, talks with Bloomberg’s Julie Hyman and Mark Crumpton about Exxon Mobil Corp.’s acquisition bid for XTO Energy Inc. Exxon, the biggest U.S. oil company, agreed to buy XTO for $31 billion in a bet that U.S. emissions restrictions will spur increased demand for natural gas. Owners of Fort Worth, Texas-based XTO will get 0.7098 share of Exxon for each of their shares, the companies said today in a statement.”

Exxon Mobil to enter Marcellus Shale with purchase of XTO Energy. Pittsburgh Business Times. “XTO has about 280,000 acres under lease, managed by its regional office in Indiana, Pa. In its third quarter operations update, XTO (NYSE:XTO) said it was upping the number of drilling rigs in the Marcellus from the two it has in the ground this year to four in 2010. It has drilled six horizontal wells thus far and has double that planned for 2009. According to the Pennsylvania Department of Environmental Protection, XTO has received 33 Marcellus Shale drilling permits as of Nov. 9, and has two permits pending.”

Range completes third phase of expansion in Marcellus. Reuters. “Range Resources Corp said the third phase of its natural gas processing infrastructure expansion program at the Marcellus shale has been completed, bringing its total capacity in the region to about 180 million cubic feet per day. The Marcellus shale, located in the northeastern U.S. in parts of Pennsylvania, New York and West Virginia and said to contain enough natural gas trapped in rock to meet domestic needs for a decade or more, has a number of companies trying to increase their foothold in the region.”

Special Report: Canada looks to shales for boost to gas supply. Oil & Gas Journal. “Natural gas from shale formations represents a potentially crucial source of supply growth in Canada, where production from conventional reservoirs is declining in a trend likely to continue. While two shale gas plays—in the Horn River basin straddling the boundary between northern British Columbia and Alberta and the Triassic Montney shale to the south—draw most of the current drilling, potential exists elsewhere in the country. In some of the newer plays, drilling has just begun.”

Poland is at the top of the list for shale potential. Houston Chronicle. “Two Houston-based companies, ConocoPhillips and Marathon Oil, are betting that Poland, which gets half of its natural gas from Russia, can yield a development boom in shale formations like those that drove a jump in U.S. output of the heating fuel. The U.S. oil companies obtained exploration licenses this year covering hundreds of thousands of acres in Poland. The country, which imports 72 percent of its gas, could become an exporter of the fuel, said Maciej Wozniak, chief adviser on energy security to Prime Minister Donald Tusk.”

Energy In Depth: Today’s News

Haynesville Shale the bright spot in 2009. The Daily Advertiser, LOGA’s Don Briggs. “For more than a century, the oil and gas industry has remained the backbone of Louisiana’s economy. From the developments and discoveries of the early 20th century, to the boom of the 1970’s, and to the eventual bust of the mid 80’s, the industry has experienced a long roller-coaster ride of ups and downs. However, the unprecedented discovery of the Haynesville Shale has the potential to subside the turbulent and cyclical ebb and flow of the industry in North Louisiana. … In 2008, investment in the Haynesville Shale resulted in the direct creation of more than 430 high-paying jobs. In addition, state and local tax revenues also skyrocketed by at least $153 million. We can most certainly expect an exponentially larger number of jobs created, higher tax revenues, and increased royalty payments in the future.”

Politicians choose sides in Marcellus Shale drilling debate. Press & Sun-Bulletin. “Elected officials taking a position on Marcellus Shale development are facing strident demands from stakeholders who could become rich, go broke or possibly abandon hope, depending on Albany’s response. As a Dec. 31 public comment deadline approaches, the polarizing debate shows no sign of easing. Stakeholders continue to hold town hall meetings, sign petitions and write elected officials in an attempt to make or break the multibillion-dollar gas industry’s move to the Southern Tier. … The national pro-drilling advocacy group Energy In Depth, meanwhile, rallied members to “share (their) views on the important role that responsible natural gas development can play in lifting the local economy and putting New Yorkers back to work.”

Don’t squander energy opportunity. Houston Chronicle, Prof. Bernard Weinstein. “Extracting natural gas from shale rock is a different enterprise than wildcatting. Indeed, it’s essentially a manufacturing process that combines “hydraulic fracturing” with horizontal drilling. Fracturing involves the injection of water, chemicals and sand to crack the rock and release the trapped gas. Horizontal drilling, in turn, enables a single well to follow a seam of shale for up to two miles, thereby producing much more gas from one well. In recent months, concerns about the environmental impacts of hydraulic fracturing have been raised both in the Barnett Shale and the newer gas plays in Louisiana and the Northeast. In particular, some environmental groups are claiming that the chemicals used in fracturing are contaminating local water supplies. In fact, New York State has imposed a moratorium on gas drilling anywhere in the New York City watershed.” NOTE: This column also appeared in The News-Star.

Susquehanna residents wary of gas-drilling operation. Philadelphia Inquirer. “’We have an enormous opportunity, and we have to be careful how we approach it, but if we do it correctly, in the end I think the area will benefit dramatically,’ said U.S. Rep. Christopher Carney. The 10th District Democrat lives on a small lot in Dimock, a quarter mile from a towering drill rig that operates around the clock. “The gas business has been good to us,” said Lori Davis, 42, who bought the Elk Lake Filling Station two years ago with a $20,000 down payment she and her husband got from a gas lease on their farm. … Though some activists have blamed the gas leaks on hydraulic fracturing – the practice of injecting massive amounts of water and chemicals into a hole to shatter the shale and stimulate gas production – “fracking” is not implicated in the Dimock gas migration, DEP says.”

World to get glimpse of ‘Haynesville’ in Copenhagen. Shreveport Times. “The Haynesville Shale and its potential impact on the world’s energy future will on display Monday at the 15th United Nations Climate Change Conference in Copenhagen. … The film tells the story of the Haynesville Shale itself — touted as the largest natural gas find in the United States — and broadens the view to what that could mean to a country searching for solutions to its energy future. Environmentalists, academicians and oil and gas insiders hash out the issues.”

Energy In Depth: Today’s News

Natural gas from shale portends opportunity for Americans, the economy. San Antonio Express, Op-Ed. “Fifteen years ago, no one in the United States, or in North Texas for that matter, had ever heard of the Barnett Shale — except maybe a few geologists. Today, it’s the largest natural gas field in the United States, producing 4 billion cubic feet a day. What’s more, the Barnett Shale has added a new dimension to the North Texas economy, supporting thousands of jobs and generating millions in tax revenue for local governments and school districts. … Extracting natural gas from shale rock is a different enterprise than wildcatting. Indeed, it’s essentially a manufacturing process that combines “hydraulic fracturing” with horizontal drilling. Fracturing involves the injection of water, chemicals and sand to crack the rock and release the trapped gas. Horizontal drilling, in turn, enables a single well to follow a seam of shale for up to two miles, thereby producing much more gas from one well.”

Thousands Petition Gov. To Scrap Nat. Gas Regulations. WENY-TV. “Thousands of New Yorkers signed a petition asking Gov. David Paterson to scrap natural gas drilling regulations, and start from scratch. Environmentalists, landowners — even politicians — are voicing concerns over the DEC’s draft environmental impact statement on horizontal gas drilling. … Chris Tucker of Energy In Depth, an organization that represents independent gas drillers, said, “This was a culmination of a three year process.  This wasn’t just done overnight.” Tucker says the DEC has done its due diligence with the horizontal regulations, and its time the state reaps the economic benefits. “What they produced was essentially one of the most comprehensive and aggressive regulatory program as it relates to natural gas exploration in the entire country,” said Tucker.”

Delaware supervisors vote to back gas drilling. Oneonta Daily Star. “The Delaware County Board of Supervisors voted Wednesday to support drilling for natural gas in the Marcellus shale on the condition that the state’s Supplemental Generic Environmental Impact Statement addresses environmental concerns with sound science and regulatory safeguards. … “Natural-gas drilling is no different than harvesting trees, quarrying bluestone or farming the land. This has the most potential long-term financial impact for the county. We have to go back to putting the economic well-being of the residents first,” … “Natural gas drilling presents an economic opportunity with immense potential for retaining existing businesses, development of new businesses with the associated employment opportunities while contributing significantly to national goals of a cleaner environment and energy independence.”

Schedule Next Jobs Forum Where They’re Drilling for Natural Gas. NAM’s ShopFloor.com. “NBC Nightly News on Sunday ran a segment on the thousands available jobs in Bismarck and the rest of North Dakota, attracting out-of-state residents for jobs in health care, IT, energy, manufacturing and construction. Energy has driven economic growth in the state, thanks to coal and, since earlier this decade, oil and gas development from the Bakken formation. An e-mailer — not me — expounded on NBC’s misdirected coverage today at National Review’s The Corner blog.”

Oklahoma Gains Regulatory Voice. Tulsa Business Journal. “Oklahoma Corporation Commission Chairman Bob Anthony is appointed to the board of directors of the National Association of Regulatory Utility Commissioners. … “At a time when our critically important domestic oil and gas producers are under attack over issues like hydraulic fracturing and global warming, and alternative energy such as wind power is raising new questions and issues, it is essential that Oklahoma’s perspective be represented at national forums where dramatic and costly decisions are being made,” Anthony said. Earlier this year, Anthony was successful in getting NARUC approval of a resolution supporting continued state regulation of hydraulic fracturing, a process critical to domestic natural gas and oil production.”

Shale Gas Could Transform Energy Geopolitics. Atlantic Council, Op-Ed. “Lost amidst the doom and gloom over global warming and energy dependence on the Middle East and Russia is the fact that new technologies and drilling techniques are allowing recovery of gas trapped in shale and gradually but inexorably transforming the global energy security equation. For all the hopes of transitioning to renewable energy sources, as the Copenhagen climate talks underscore, the reality is that fossil fuels will continue to be predominant for the coming decade and probably longer. And as the cleanest of fossil fuels, natural gas will likely remain the fuel of choice.”

Executives say good times ahead for natural gas. Houston Chronicle. “The North American natural gas business has its best days ahead, according to a survey of the industry taken by consulting and accounting giant Deloitte, but many expect more layoffs in the coming year and more cost-cutting. Despite low natural gas prices, 84 percent of the oil and gas executive surveyed are bullish on gas because of the surge in production from plentiful shale and coal bed methane formations, combined with an expectation that climate change legislation will increase the demand for natural gas-fired power generation, said Gary Adams, vice chairman and leader of Deloitte’s oil and gas practice.” NOTE: Click HERE to view the Chronicle’s blog post and the full Deloitte survey.

Jackson Township Holds Zoning Meeting For Gas Drilling. WJAC-TV. “Jackson Township officials scheduled a zoning hearing for property on Kepple Rd. The purpose is to hear the appeal of Petroleum Development Corporation from Bridgepot, W.V. The meeting is set for 6 p.m. Wednesday . The public is invited to attend. The project consists the company drilling for gas for a month at a time. And the property owners will get a certain percentage from the profit. Some neighboring property owners think Marcellus gas well drilling will be great for developing the area.”

Energy In Depth: Today’s News

Obama Administration: No Documented Cases of Hydraulic Fracturing Contamination. Sen. Inhofe Release. “During today’s Senate Committee on Environment and Public Works hearing on “Federal Drinking Water Programs,” Senator Inhofe asked officials from the Environmental Protection Agency (EPA) and the United States Geological Survey (USGS) if they were aware of any documented cases of hydraulic fracturing contamination. None of the three witnesses could provide a single example. Testifying before the EPW Committee today was Peter Silva, Assistant Administrator for Water, Environmental Protection Agency, Cynthia Giles, Assistant Administrator for Enforcement and Compliance Assurance, Environmental Protection Agency, and Matthew Larsen, Associate Director for Water, U.S. Geological Survey.” NOTE: Click HERE to view the exchange online and HERE to view EID’s blog post “Top Brass from Obama Admin Tell Congress They’re “Not Aware” of Even “One Case” of HF-Related Contamination.”

Expert says 95 percent of oil, gas wells are fractured. Grand Junction Free Press. “As much as 95 percent of the oil and gas wells in the world are now dependent on the technique known as hydraulic fracturing, because the easily reached petroleum reserves have basically been used up, an industry expert said. “By definition, the low-hanging fruit in the oil and gas industry is gone,” said Jennifer Miskimins, associate professor of the Petroleum Engineering Department at the Colorado School of Mines in Golden for the past eight years. … And, she said, the thing to worry about is not that the chemicals get released, but the hydrocarbons – the chemicals that make up oil and natural gas. “There’s nothing in frac’ing fluids that’s any more dangerous than the hydrocarbons we’re producing,” she declared, adding that the chemicals added to the fluids are in “very small volumes” compared to the gas produced.”

Shale gas a game changer? UPI. “Technology used to exploit natural gas locked in shale deposits could transform the geopolitical dynamics in the global energy sector, a U.S. analyst suggests. Explorers are using hydraulic fracturing and horizontal drilling techniques to release gas trapped in shale rock formations, creating a market frenzy over shale gas. Robert Manning, an energy adviser to the Atlantic Council, points to projections from the U.S. Energy Information Agency that suggest shale gas could make up more than 60 percent of the domestic market by 2030. Similar trends are expected in Asia and the Pacific Rim.”

Is natural gas the ‘energy answer’? Washington Post, ANGA’s Regina Hopper. “The Dec. 3 front-page story “An energy answer in the shale below?” should have provided timely reading for the Obama administration as it prepared for the international climate change gathering in Copenhagen this week. The article rightly focused on a game-changing discovery for America’s energy future — clean, abundant natural gas available in vast quantities right here in the United States. This discovery can also be a game-changer for the role America plays as a leader in the international climate change debate.”

Re: ‘Need a Job? Go North, to Bismarck’. National Review Online. “A hundred-year supply of natural gas has just been discovered in the last couple of years in the Marcellus Shale which underlies much of PA, NY and to a lesser extent other eastern states. If these states are open to the development of the natural gas like ND has been to the oil, they could enjoy the same economic situation. Unfortunately for the laid-off blue collar workers from those industrial states, the elitist environmental-minded politicians and ngo’s will likely block the potential economic boom.” NOTE: Click HERE to view the MSNBC segment.

Apache to pursue New Brunswick shale gas. Oil & Gas Journal. “Apache Canada Ltd. signed a farmout and option agreement with Corridor Resources Inc., Halifax, NS, to pursue gas in Frederick Brook shale in southern New Brunswick, Canada. The 18-month program of at least $25 million in spending is designed to evaluate the commercial potential of natural gas development in the Frederick Brook shale and light oil development at Corridor’s recent Caledonia oil discovery. Apache committed to conduct an appraisal program consisting of any combination of seismic, drilling, fracturing, testing, and completing or abandoning one or more horizontal or vertical oil, gas, and shale gas wells.”

Energy In Depth: Today’s News

Natural gas locked in the Marcellus Shale has companies rushing to cash in on possibilities. Pittsburgh Post-Gazette. “’It was an amazing thing,’ Ms. Haines said, and a small indicator of surging interest in the Marcellus Shale, a geological formation that sprawls from midstate New York across more than half of Pennsylvania and into Ohio and West Virginia. Little regarded five years ago, the Marcellus Shale is now viewed as one of the world’s leading reservoirs of recoverable natural gas. … Suddenly investors and producers from all over the country and abroad swarmed into the state to lease land and to drill wells, more than 300 by year’s end. “It’s always about capitalism and making money,” Mr. Walker said. “That’s why it all works.” According to a report released in July by Penn State’s College of Earth and Mineral Sciences, the Marcellus Shale helped create more than 29,000 new jobs in Pennsylvania in 2008.” VIDEO.

Expert says 95 percent of oil, gas wells are fractured. Glenwood Springs Post Independent. “As much as 95 percent of the oil and gas wells in the world are now dependent on the technique known as hydraulic fracturing, because the easily reached petroleum reserves have basically been used up, an expert told a local audience this week. “By definition, the low-hanging fruit in the oil and gas industry is gone,” said Jennifer Miskimins, associate professor of the Petroleum Engineering Department at the Colorado School of Mines in Golden for the past eight years. Prior to that, she said, she worked in the oil and gas industry. … “There’s nothing in frac’ing fluids that’s any more dangerous than the hydrocarbons we’re producing,” she declared, adding that the chemicals added to the fluids are in “very small volumes” compared to the gas produced.”

Water Authority: Oil, Gas Drilling Would Not Jeopardize Reservoirs. WJAC-TV. “A local official said possible oil and gas drilling in Cambria County would not pose any dangers to reservoirs. The Cambria-Somerset Water Authority previously put out requests to allow drilling on its land. The water authority has three major reservoirs: Hinckston, Quemahoning and Wilmore. Each attract many recreation activities, but only the Quemahoning provides drinking water to some Somerset County residents. Cambria County Commissioner Jim Market said the water is a viable source for the area for years to come, but Water Authority Chairman James Greco said the authority would do nothing to jeopardize that source. Greco said the Water Authority has 5,000 acres of land it wants to utilize for drilling and there would be no risks to the reservoirs.”

The energy answer? Natural gas. Politico, Sens. Mary Landrieu and Saxby Chambliss. “America is experiencing a natural gas revolution. Prices are 33 percent lower than they were last year, and the industry is producing significantly more gas, thanks to technology that has uncovered enormous new supplies of natural gas. The United States has three times the amount of natural gas it thought it had in 1966 — and 40 percent more than just a few years ago. In fact, more than 2,000 trillion cubic feet of natural gas is estimated to be available; at present consumption levels, that’s enough to heat all U.S. households for the next 519 years. In northwest Louisiana alone, the Haynesville Shale reserve has 251 trillion cubic feet of recoverable natural gas, almost 11 times the amount consumed by Americans last year.”

Landowners want more horizontal gas wells. Charleston Gazette. “A group of West Virginia landowners plans to ask the Legislature to take steps that spur natural gas companies to drill more horizontal wells and fewer vertical ones. The push comes amid the expectation that drilling in the Marcellus Shale formation will take off across the state in the coming years. Horizontal wells typically cause less water pollution, destroy fewer meadows and forests, and help preserve coal reserves, according to the West Virginia Surface Owners’ Rights Organization. “One well site replaces four well sites with horizontal drilling,” said David McMahon, a Charleston lawyer and co-founder of the group that represents surface land owners in oil and gas regulatory issues. “Horizontal drilling provides greater access with a smaller footprint.”

Blackfeet sign major oil, gas exploration pact. Great Falls Tribune. “The Blackfeet Tribe signed its third major oil exploration agreement, the largest in the tribe’s history, Oil and Gas Manager Grinnell Day Chief said Friday. Darryl Howard, president of Newfield Production Co., a Houston firm with regional offices in Denver, came to Browning on Thursday to sign an agreement allowing them to drill test wells in the middle of the reservation, Day Chief said. “We have a drilling commitment that will require them to drill a number of wells, if successful,” he said. “It’s the largest agreement we’ve ever signed.” Day Chief said Newfield will be drilling horizontal wells into the Bakken Formation and other formations that lie below the surface of the middle of the Blackfeet Reservation. Horizontal drilling into the Bakken Formation is very productive in the northeast corner of Montana.”

Marcellus Shale partners dig up wealth through joint ventures. Pittsburgh Business Times. “There’s only so many acres — about 22.4 million to be exact — in the natural gas rich Marcellus Shale, the darling of the fossil fuel exploration industry, according to Scott Richardson, principal at RBC Richardson Barr, an investment firm in Houston that specializes in oil and gas companies. With many mineral rights already purchased, and the high capital expense of drilling Marcellus Shale wells — a single well can run up to $1 million — many companies in the field are forming joint ventures with well-capitalized firms looking for entry into the Marcellus.”

Tapping A Gradual Recovery. Investor’s Business Daily. “When Baker Hughes acquired BJ Services for $5.5 billion in September, it was the first major merger in oil-field services and equipment since energy prices plunged last year. The long-rumored reunion — 18 years after Baker Hughes spun off BJ to focus on its core drilling business — also shows just how much the business has changed over the last two decades. These days, oil producers want service vendors that can work a well from start to finish. BJ’s hydraulic fracturing, pressure-pumping and oil well cementing bolster Baker Hughes’ in-house capabilities, and the combined entity rivals global oil-field service giants Schlumberger and Halliburton, says Gene Shiels, Baker’s assistant director of investor relations.”

Chesapeake earns two honors from industry group. The Oklahoman. “Chesapeake Energy Corp. took home two awards at this week’s 2009 Platts Global Energy Awards ceremony in New York. The Oklahoma City-based natural gas producer was honored as the Energy Producer of the Year for its expertise in shale gas plays, its high success rate in exploration activities and its consistent production growth.” 

Energy In Depth: Today’s News

An energy answer in the shale below? Washington Post. “”It’s what’s really going to turn this whole place around,” said her son Daniel Fitzsimmons, who has since helped form the Binghamton Conklin Gas Lease Coalition. … As a result, said BP chief executive Tony Hayward, “the picture has changed dramatically.” “The United States is sitting on over 100 years of gas supply at the current rates of consumption,” he said. Because natural gas emits half the greenhouse gases of coal, he added, that “provides the United States with a unique opportunity to address concerns about energy security and climate change.” … Credit for discovering that gas could be economically extracted from shale generally goes to George Mitchell, former head of Mitchell Energy. In the early 1980s, as the company’s production was declining, Mitchell and his geologists started experimenting with “hydraulic fracturing” — blasting underground layers of shale with a mixture of water, chemicals and sand to crack the rock and get gas flowing out of it.”

Drilling right into a heated environmental debate. Washington Post. “Oil and gas companies have figured out how to turn shale rock into natural gas gushers, but they have also hit a deep well of anxiety about the environmental impact of drilling in some of the country’s most scenic areas. The debate revolves around a technique known as hydraulic fracturing, which unlocks natural gas by shattering shale rock with high-pressure blasts of water, chemicals and sand. … Gas exploration companies say that proper drilling techniques seal off wells with concrete and that the shale layer is a mile or more below drinking-water aquifers, providing protection.”

Will W.Va. experience a boom in natural gas? Charleston Daily Mail, Editorial. “New drilling techniques that make it possible to develop the Marcellus Shale and other previously unexploitable formations have West Virginia’s natural gas people excited. As Daily Mail Business Editor George Hohmann reported recently, the formation is an enormous resource – 15 million acres – containing potentially trillions of cubic feet of natural gas. … Ben Hardesty of Dominion Exploration and Production Inc. told Hohmann that the Marcellus play is “a great opportunity for our state as far as job creation and a higher tax base,” adding: “A lot of wealth will be created.” … West Virginia will have to position itself very carefully to capitalize on this opportunity.”

New York considers new rules for natural gas drilling. North Country Public Radio. “Lawyers, local officials and landowners met Monday in the Southern Tier to mull over the future of natural gas development in the Marcellus Shale. Development appears inevitable. But how that development unfolds is still being shaped. The controversial new drilling technique called hydrofracking would inject millions of gallons of water, sand and chemicals deep into the ground to break up rock and release the natural gas. Hydrofracking part of the problem. But it’s not the only concern in New York.”

Agency is correct to permit more time. Grand Junction Sentinel, Editorial. “State gas drilling permits in Colorado will now be good for two years, instead of one, exactly the same amount of time allowed under a federal drilling permit. That’s important, because many energy companies in Colorado drill on federal land as well as private land. And when they work on federal lands, they need a state permit as well as a federal one. It’s only sensible that the two operate for the same time period. Additionally, as technology allows more and more wells to be drilled from a single well pad, it may not be possible to drill all of the permitted wells within one year.”

Record Barnett HC content seen in combo play. Oil & Gas Journal. “Hydrocarbon content in the thickest part of the Mississippian Barnett shale combo play in North Texas is so great that even 2-3% recovery is highly economic, said EOG Resources Inc., Houston. … EOG has drilled 100 wells in 3 years in the combo play, with initial potential rates at 300-1,000 b/d of oil, 130 b/d of natural gas liquids, and 1-2 MMcfd of gas, but it has had to climb a learning ladder, Leiker said. The early mistake was trying to apply horizontal drilling and fracturing technology learned in the Barnett gas areas to basically the same rock type in the oilier combo play.”

Energy In Depth: Today’s News

Natural gas: It’s not the drilling, it’s the drills. Globe and Mail. “Don’t focus too much on what the seasonal trends in natural gas demand are telling you. The technology trends are trumping them – and they’re changing the entire nature of the North American gas market, contends Patricia Mohr. “New ‘game-changing technology’ – improvements in horizontal drilling and multi-fracturing of unconventional gas – has dramatically changed the dynamics of the North American natural gas market in the past year and a half,” the veteran Bank of Nova Scotia economist and commodities specialist said in a report Monday.”

First Marcellus Shale natural gas well drilled in Lackawanna County. Scranton Times-Tribune. “A Pittsburgh-area subsidiary of a Texas-based natural gas operator has drilled the first Marcellus Shale well in Lackawanna County in Greenfield Twp. Exco Resources (PA) Inc., formerly Exco-North Coast Energy Resources Inc., is studying shale samples from the well, named Skyline Golf Course Unit 6V, located east of Route 247 in the township. Exco Resources (PA) President Wendy Straatmann said the company hopes to use the information it gleans from the rock – laboratory work that could take months, she said – to help determine the viability of the well and Exco’s wider drilling program in the area. The company will use the sample as a snapshot of the natural gas that is in place in the shale as well as how much of that gas is recoverable.”

Legislators: Balance needed to protect environment. Williamsport Sun-Gazette. “A balance between caring for the environment and not creating draconian regulations that dissuade natural gas drillers is necessary as the exploration of the vast Marcellus Shale reserve moves forward. That’s what state Rep. Garth D. Everett, R-Muncy, who is on the Environmental and Energy committee in the House of Representatives, and Sen. E. Eugene Yaw, R-Loyalsock Township, said Tuesday following the release of a report by environmental watchdog group PennEnvironment. The report, titled Preserving Forests, Protecting Waterways, is a series of proposals and regulatory solutions the group believes will address environmental and public health problems associated with gas drilling.”

Allegheny Conference forms new Energy Alliance of SW Pennsylvania. Washington Observer Reporter. “The Allegheny Conference on Community Development has announced the formation of the Energy Alliance of Southwestern Pennsylvania, a strategic partnership for tomorrow’s energy solutions. … The alliance also noted that Southwestern Pennsylvania sits atop extensive energy industry resources including coal and the natural gas from within the Marcellus Shale. According to a recent Penn State University report, the Marcellus Shale is the largest unconventional natural gas reserve in the world with recoverable reserves estimated to be at least 489 trillion cubic feet. In 2008, the Marcellus gas industry in Pennsylvania generated $2.3 billion in total value added and more than 29,000 jobs. The pace of development and extraction is expected to increase and by 2020, the Marcellus Shale activity is forecast to be generating $13.5 billion in value added and almost 175,000 jobs.”

Team up to develop drilling regs. Elmira Star-Gazette, Editorial. “Local governments in New York state will have a lot in common when – or if – Marcellus Shale natural-gas drilling operations set up shop in their backyards: They all will have to enforce some kind of regulations. … Even though the exact startup of hydro-fracturing drilling hasn’t been determined, local governments need to position themselves to handle the impact of this venture. What local officials need to realize most is that since they’re all facing similar issues, they ought to take the best ideas from each other and not waste time and money reinventing rules or methods already established by other communities.”

Commissioners Mull Gas Drilling. Wheeling News Register. “Though nothing is official yet, Ohio County Commissioners may vote to permit natural gas drilling at The Highlands, just as Wheeling voted to allow drilling at Oglebay Park. “We have discussed it. … It is under consideration,” Commissioner David Sims said following his Tuesday meeting with commissioners Randy Wharton and Tim McCormick. “It would have to be voted on, just like it was with the city,” Wharton added of any potential drilling.”

A Bridge to Energy Self-sufficiency. National Driller, Op-Ed. “Those of us in the drilling industry have known about shale gas for years, but it was more of an un-economic nuisance than a reliable energy source. In the first place, shale wells didn’t produce much, and depleted quickly when compared to an oil well. In addition, you couldn’t put gas in a tank battery and haul it away by truck. It takes a pipeline. This is where free enterprise and drillers’ ingenuity come in. We now have a tremendous infrastructure of pipelines running from most of the major producing areas to the areas of highest load. We also have learned how to frack these shales to produce much more gas.”

Energy In Depth: Today’s News

Don’t ignore huge potential of natural gas. Wisconsin State Journal, Op-Ed. “Imagine this: A new technique for drilling into layers of a black rock called shale unlocks vast amounts of previously inaccessible natural gas. … If the predictions of so-called “unconventional” natural gas – from shale, coal-bed methane and “tight” formations – are realized, it will mean a renaissance for natural gas that will provide important economic and environmental benefits. … Hydraulic fracturing, which is key to the future of natural gas, involves the injection of high-pressure fluid, mainly water mixed with sand and various chemical compounds, to break through shale to reach deposits of natural gas. The process has come under attack from emotional (not scientific) environmental groups engaged in irrational fear-mongering. They claim the process poses a danger to groundwater systems. But there are no documented cases of groundwater contamination caused by hydraulic fracturing.”

Blame technology for gas glut. Globe and Mail. “Don’t focus too much on what the seasonal trends in natural gas demand are telling you. The technology trends are trumping them – and they’re changing the entire nature of the North American gas market, contends Patricia Mohr. “New ‘game-changing technology’ – improvements in horizontal drilling and multi-fracturing of unconventional gas – has dramatically changed the dynamics of the North American natural gas market in the past year and a half,” the Bank of Nova Scotia economist and commodities specialist said in a report yesterday. … The rapid adoption of horizontal-drilling advancements has triggered an explosion of new unconventional shale-based gas output that features lower production costs and improved well productivity.”

Landowner reps urge DEC to move ahead. Evening Sun. “Representatives from the two major landowner groups in Chenango County told New York’s environmental regulating agency that hydrofracking into the natural gas rich Marcellus Shale could be performed “safely and in an environmentally secure way” and should be allowed to proceed. Bryant Latourette, chairman of the Oxford Land Group, said members of coalitions have become increasingly frustrated by those who are opposed to the possibility of any type of natural gas exploration. “While natural gas exploration has been conducted safely in New York for decades, the public has been misinformed repeatedly by extremists/obstructionist groups whose agenda is only to kill new investments in some of the state’s most economically deprived regions,” he said.”

Natural Gas Drilling Summit. WICZ-TV. “Advocates for both sides of the natural gas drilling issue met in one location Monday to learn more about the implications it would have on area communities. … Broome County Legislator Steve Herz says he learned through Penn State’s research, that small businesses would see a big boost from drilling, something our area sorely needs. “The laundry services, for some of these workers, are doing great, bed and breakfasts are being booked months in advance, 100 percent payment, it’s astonishing what this will do,” said Leg. Stephen Herz, (D) District 9, Broome.” VIDEO.

Summit of local leaders discusses pros, cons of gas drilling. Ithaca Journal. “Development of the Marcellus Shale, the largest natural gas resource in the country, has the potential of creating thousands of jobs, an economic development official said Monday. “It’s absolutely huge in terms of the number of jobs and economic impact,” said Larry L. Michael, Pennsylvania College of Technology’s workforce and economic development director. That said, a “rational analysis” needs to be done to gauge the effect of natural gas drilling on farming, tourism, recreation and other industries in the Southern Tier, an official with the Sierra Club opined.”

Summit Draws Discussion on Gas Drilling. WENY-TV. “The debate over drilling for natural gas in the Marcellus Shale in New York State continued in Owego today. Over 350 people directly involved in the discussion — land owners, lawyers, corporate representatives, and environmentalists — crowded into the Owego Treadway Inn to go over some of the advantages and disadvantages of drilling. The summit was organized to try to encourage both learning and dialogue, according to Rod Howe, assistant director of the Cornell Cooperative Extension.”

Natural Gas Summit in Tioga County. WBNG-TV. “Cornell Cooperative Extension hosted a Marcellus Shale summit at the Owego Treadway Inn. And as Action News Reporter Julianne Sweeney tells us, it was a chance for landowners and government leaders to do more homework. Everyone from people looking to lease land to people concerned about environmental impacts showed up at this Cornell Cooperative Extension summit about drilling into the Marcellus Shale.”

Johnstown Officials Hope To Sell Water To Natural Gas Companies. WJAC-TV. “More drilling sites for natural gas could be popping up in Cambria County, and some municipal water authorities said that’s good news for them. In order for companies to extract the gas, they need water. In response, Johnstown city officials said they have already been contacted from some drilling companies interested in purchasing water from the city. Tuesday, Johnstown officials approved the sale of water to one company and said the city could make about $14,000 just from that one sale. The company is expected to start drilling one well, but if it finds much natural gas, they may drill even more in the greater Johnstown area.”

Citizen training for spotting drilling problems criticized by natural gas industry. Scranton Times-Tribune. “A small watershed protection group has drawn the disdain of the state’s natural gas industry by offering a training program to help citizens in Northern Pennsylvania learn how to document and report potential environmental violations at Marcellus Shale natural gas drilling sites. … Reaction from the state’s natural gas industry ranged from disbelief to derision. The Pennsylvania Oil and Gas Association posted news of the event on its Web site under the headline, “Environmental vigilante training to help enforce Marcellus drilling regs.” “In just two hours you can learn all you need to know to be an environmental vigilante and help protect our watersheds from Marcellus gas drillers,” the post said.”

Towns may try carrot approach with drilling companies. Ithaca Journal. “Instead of focusing solely on setting up a legal framework in which to regulate the gas drilling industry, local leaders have been told they should consider working with gas companies to come up with mutually advantageous agreements. At a recent session of the Tompkins County Council of Governments, Brett Chedzoy, a member of the Schuyler County Task Force on Energy Development Issues, said he has visited existing Fortuna Gas drilling sites in Pennsylvania and found the experience enlightening. “If you talk to industry, they’re not really trying to hide what they are doing,” Chedzoy said. “If you ask, they are usually willing to share information.”

Pipeline progress. Grand Junction Sentinel, Editorial. “New pipelines are carrying Western Slope natural gas to various parts of the country and making locally gathered gas as valuable — or nearly so — as natural gas produced in other parts of the country. That’s critical because, for a long time, pipeline capacity has limited the amount of natural gas that can be shipped out of this region and depressed the price of Piceance Basin gas by several dollars below the national average per thousand cubic feet of gas. … Major new gas plays in the eastern United States, Louisiana and Texas that have become feasible to drill because of improved technology have helped to decrease gas prices. So has the recession, which has curtailed the use of natural gas in manufacturing.”

Bakken overdrive. Oilweek Magazine. “The initial breakthrough in the Bakken came four years ago with horizontal drilling and Halliburton´s SurgiFrac completions system using coil tubing and multi-stage fracturing. But what put the play on the map was the application of horizontal drilling in combination with the Packers Plus StackFrac system of open-hole multi-stage fracing. A similar combination of technologies launched the U.S. shale gas revolution that would flood North America with natural gas. That development would conspire with a global economic recession, oil and cash would become king, and Saskatchewan would emerge as a Canadian economic champion.”

Mansfield’s proposed budget considers growth potential. Shreveport Times. “The document in aldermen’s hands and available for public viewing adds four additional employees — two police officers, a firefighter and a street department worker — to compensate for added responsibilities that city leaders believe will be needed given the forecasted growth potential associated with the Haynesville Shale exploration and development. Because even though the drilling operations so far are happening outside of Mansfield’s borders, the city is benefiting financially through increases sales taxes while at the same time anticipating an increased demand for services.”

Energy In Depth: Today’s News

Pennsylvania ‘Wilds’ benefit greatly from Marcellus Shale. Patriot-News, Fmr. Congressman John E. Peterson. “In a recent Patriot-News opinion column, a writer described this production — which is helping to create thousands of good-paying jobs, generating steady revenue streams for local governments and delivering huge royalty payments to everyday Pennsylvania landowners — as “an assault on our northern forests.” Arguments such as this attack the means in which the clean-burning, job-creating natural gas is extracted from thousands of feet below the surface in tight, densely packed shale rock. The 60-year old technique is called hydraulic fracturing. Without this technology, the clean-burning natural gas trapped in the Marcellus Shale — which some independent experts believe to be the world’s largest natural gas reserve — could not be reached and delivered to families, small businesses and seniors in the form of more affordable energy supplies.”

Marion Twp. rig could be beginning of a boom beneath us. Beaver County Times. “A natural gas boom that has been raging in southwestern Pennsylvania since 2004 has finally touched Beaver County with the drilling of a well in Marion Township. The 168-foot-high behemoth sitting in a farm field off Hartzel School Road represents a first foray into the county by Range Resources, an independent oil and gas company based in Fort Worth, Texas, with a local office in Washington County. Range representatives said the site is a test well being drilled by subcontractor Patterson Drilling Co. of Snyder, Texas. Drilling began last month and will continue around the clock until at least January.”

Vast supply alters gas industry. Charleston Daily Mail. “West Virginia’s natural gas industry is being transformed by an increase in supply as spectacular as the oil discoveries made at the turn of the last century by the late Michael Benedum. … Geotechnical engineers and other specialists have figured out how to drill down into shale and then go sideways to open a much bigger area of the gas-bearing formation. They’re also injecting a mixture of water and sand into the well at high pressure, creating multiple fractures throughout the shale, freeing the trapped gas to flow into the well. In addition, they’re injecting additives to keep the wells from gumming up. “All these things have made the Marcellus Shale a workable formation for us,” said Corky DeMarco, executive director of the West Virginia Oil and Natural Gas Association.”

Senator won’t support legislation on ‘fracking’. Jackson Hole Daily. “Hydraulic fracturing is a method energy companies use to get gas from geological structures by pumping fluids at high pressure into the ground and fracturing the subsurface rock. Barrasso spokesman Gregory Keeley called the process a “safe and effective way to develop our domestic oil and gas reserves for decades.” … “The state of Wyoming effectively regulates oil and gas exploration activities, including hydraulic fracturing,” Keeley said in an e-mail. “There is a comprehensive legal and regulatory framework in place to ensure the safety of oil and gas operations, as well as to protect our nation’s drinking water. Senator Barrasso believes the FRAC bill will simply add another layer of federal bureaucracy, increasing the hurdles for responsible development of America’s natural resources.”

Pennsylvania College of Technology to offer courses in gas field. Elmira Star-Gazette. “With an eye on the growing need for properly trained gas field workers, the Pennsylvania College of Technology is offering several related training courses at its North Campus on U.S. Route 6 near Wellsboro. The college, located in Williamsport, is Penn State University’s largest affiliate. The courses are being offered, starting in January, through its Marcellus Shale Education & Training Center. Drilling horizontally into the Marcellus Shale is on hold in New York until the state Department of Conservation completes the environmental impact statement that will regulate the drilling.”

Gas-drilling summit draws experts. Ithaca Journal. “The massive geological formation, running under the Southern Tier and throughout Pennsylvania, holds the largest natural gas resource in the country. Its full-scale development carries the prospects of significant changes to the region’s landscape and economy. Regulators, geologists, lawyers, emergency responders, landowners, municipal officials, economic developers and other stakeholders are scheduled to meet at the Owego Treadway Inn for a daylong summit on the impact of Marcellus development. The event, open to the public, will begin at 9 a.m., with registration at 8:15 a.m.”

Natural Gas Glut Overwhelms Speculators, Defies Rally. Bloomberg. “Reserves in the U.S. may be 39 percent higher than estimated just two years ago, reflecting improved yields of gas stored in rocks such as shale, the Potential Gas Committee, a non-profit group linked to the Colorado School of Mines, said in a June 18 report.  An “acute glut” is looming during the next five years because of rising shale gas production in the U.S. and Canada, the Paris-based International Energy Agency said in its World Energy Outlook on Nov. 10.”

Carney talks health care, natural gas. Morning Times. “When Joan Gustin of Towanda asked Carney about the Fracturing Responsibility and Awareness of Chemicals (FRAC) Act, he stated that he has not yet reached an opinion, and later told the Morning Times that he and his staff are “looking more closely at the language of the act.” The piece of legislation, which is one printed page in length, would remove a paragraph of the 2005 Safe Drinking Water Act that exempts hydraulic fracturing from federal oversight. “We want to be sure we protect the water and the land here. We live in northeast Pennsylvania because we love it here. We think it’s a beautiful place (and) we don’t want to ruin that,” he said. “But we have a unique opportunity to not only realize some wealth for the region — a region that that has recently been somewhat distressed — but also to make a great contribution to national energy needs,” he added. “So that’s also part of the equation that I’m thinking about.”

Water plants can hold off, driller says. Patriot-News. “A spokeswoman for one of the drillers in the Marcellus Shale region says there isn’t a need for a dozen or more wastewater treatment plants to cleanse water used to help extract gas from natural-gas wells. The Department of Environmental Protection has received permit applications for about 12 wastewater plants, spanning seven counties, to treat water tainted from fracturing rock deep underground during the gas-extraction process. But Kristi Gittins of Chief Oil & Gas said current wastewater facilities are adequate to meet the needs for some time.”

At Odds Over Land, Money and Gas. New York Times. “Like many landowners in Broome County, which includes the town of Chenango, the Laceys could potentially earn millions of dollars from the natural gas under their feet. They live above the Marcellus Shale, a subterranean layer of rock stretching from New York to Tennessee that is believed to be one of the biggest natural gas fields in the world. … Exploring the shale involves a drilling method called hydraulic fracturing that requires pumping huge volumes of water laced with benzene and other chemicals into the rock to break it and extract gas. … But Brad Gill, executive director of the Independent Oil and Gas Association of New York, said that two years ago, gas companies could not justify high leasing costs. Prices have steadily climbed with the success of drilling the Marcellus Shale in states like Pennsylvania, he said.”

Energy In Depth: Today’s News

Expert: Drilling catastrophe unlikely with gas. Ithaca Journal. “State regulations on the actual gas drilling process are pretty good, but instructions on how gas companies must deal with “the water on either end” leave something to be desired, according to William Kapell, a hydrologist with the United States Geological Survey. At a meeting Monday night hosted by the League of Women Voters, Kapell presented basic information about gas drilling in the Marcellus Shale, “without the hype, either side.” Roughly 60 people attended the meeting, held at the Tompkins County Human Services Building.”

Another new oil formation for North Dakota? Associated Press. “A crude-bearing cache known as the Birdbear, beneath North Dakota’s already booming oil patch, can be tapped using new technology that would expand horizontal drilling to parts of the state that have never seen it, geologists believe. The Birdbear is a thin oil formation — only a few feet — locked within muddy limestone and dolomite more than 2 miles underground, immediately beneath the rich Bakken shale and Three Forks-Sanish formations in North Dakota, said Julie LeFever, a geologist with the state Geological Survey in Grand Forks.”

IPAMS lists irregularities in oil, gas leasing program. Oil & Gas Journal. “IPAMS said there are numerous instances where industry has assumed the risk and applied technologies to develop resources previously considered unrecoverable. “The potential of the Bakken shale in North Dakota has only been fully realized within the last 3 years,” it noted. “Other shales throughout the US have just started to be exploited within the last 5 years. Ten years ago, the unconventional tight sands of the Pinedale Anticline were just beginning to be tapped, and today it is the fourth-largest gas field in the US.”

Awash in fossil fuels. Washington Post, George Will. “What city contributed most to the making of the modern world? The Paris of the Enlightenment and then of Napoleon, pioneer of mass armies and nationalist statism? London, seat of parliamentary democracy and center of finance? Or perhaps Titusville, Pa. … Morse says new technologies are also speeding development of natural gas trapped in U.S. shale rock. The Marcellus Shale, which stretches from West Virginia through Pennsylvania and into New York, “may contain as much natural gas as the North Field in Qatar, the largest field ever discovered.”

Ithaca firm petitions to extend moratorium. Ithaca Journal. “Walter Hang of Toxics Targeting in Ithaca was scrounging Monday for celebrities to enlist in his fight against gas drilling in the Marcellus Shale. “Anybody know the Dalai Lama?” he said to a group gathered in the Women’s Community Building Monday evening. “Anybody know Richard Gere? Hang and the group of about 100 area residents were forming a battle plan against the state Department of Environmental Conservation’s proposed Supplemental Generic Environmental Impact Statement, which, if adopted by the state, would allow a de facto moratorium on horizontal hydraulic fracturing to end in New York.”

Energy In Depth: Today’s News

Obama promotes shale… in China. Houston Chronicle. “It wasn’t high on the list but President Barack Obama and Chinese President Hu Jintao included natural gas shale resources as an item on the clean energy cooperation agreement between the countries, notes Oil & Gas Journal: “Under the initiative, the US and China will use experience gained in the United States to assess China’s shale gas potential, promote environmentally-sustainable development of shale gas resources, conduct joint technical studies to accelerate development of shale gas resources in China, and promote shale gas investment in China through the US-China Oil and Gas Industry Forum, study tours, and workshops,” the White House said in a statement posted at its Web site. Word is George Mitchell already has several rigs working in China… just kidding.” NOTE: Click HERE to view the White House statement.

DeGette Continues Push for Federal Fracking Law. KUNC. “A just-passed Interior Department spending bill includes a provision that encourages the agency to study whether fracking is polluting groundwater. Fracking – short for hydraulic fracturing – has made it easier for companies to drill for natural gas in energy-rich states like Colorado. A similar study during the Bush Administration concluded there was no threat to groundwater. … “If we’re going to try to figure out how to regulate hydraulic fracturing, we need to make sure that we have all the scientific data on our side,” says Denver Democratic Congresswoman Diana DeGette, who’s been pushing for the study. … “Fracking has been done for over sixty years, over a million wells have been fracked and there’s no documented case of contamination,” says Kathleen Sgamma, director of governmental affairs for the Independent Petroleum Association of Mountain States.”

Hydrofracking Friction at DEC’s Public Comment Session. WENY-TV. “More than 500 people came out to the fourth and final public comment session on the Department of Environmental Conservation’s draft Supplemental Generic Environmental Impact Statement, or SGEIS, that was released in September. Not only did residents come out to protest or support hydrofracturing in New York State, but they’re also talking about the DEC’s report. … Brad Gill, Executive Director of the Independent Oil and Gas Association of New York, says his company has reviewed the DEC’s Statement and it actually puts more regulations on the industry. “We know for sure that it is extremely comprehensive, and in some cases does concern us, but industry will rise to the occasion.” Gill says there are a lot more guidelines in this statement than in the one the gas drilling industry has been following since the 1990’s. Those guidelines, he says, keep drilling safe.”

Twelve Marcellus Shale gas drilling wastewater treatment plants proposed in northern Pennsylvania. Patriot-News. “The state Department of Environmental Protection is reviewing permit applications associated with at least 12 different proposals to build treatment plants for chemical-tainted wastewater from natural gas drilling operations in northern Pennsylvania. Ten of the plants are proposed in DEP’s 14-county north-central region, which is centered on Lycoming and Clinton counties. Mel Zimmerman, a professor of biology at Lycoming College and director of its Clean Water Institute, said the flurry of permit applications is evidence of the boom in gas drilling in the Marcellus Shale region of northern Pennsylvania.”The north-central region is almost the hotspot,” he said. “They are already drilling a lot now, but over the next number of years we are going to see hundreds and hundreds of wells go in.” NOTE: The Houston Chronicle reported on this, too: Cleaning up the water from fracturing.

Putting Natural Gas to Work for America. Huffington Post, George Pataki. “Every day it’s becoming clear to more and more Americans that our continued over reliance on foreign oil is not just an environmental disaster but an economic disaster for this country as well. People appreciate that while we will have great sources of renewable fuel down the road, we need something now. And what is available now and has been proven to be in great abundance in the United States is natural gas. We are fortunate by virtue of geology, science, and technology to have the ability now to access natural gas from shale deposits that in the past were economically off limits. I think it’s a tremendous opportunity.”

High sodium levels found in water sample from Barnett Shale drilling in Flower Mound. Dallas Morning News. “A report on the water produced from gas drilling operations in the Barnett Shale shows high concentrations of sodium and traces of other elements. “It’s a very typical sample of produced water in the Barnett Shale,” said Kelly Swan, a spokesman for Williams Production, a Tulsa, Okla.-based drilling company that hired an independent laboratory to conduct the analysis. “Basically, we’re talking about salt water,” Swan said.”

Haynesville shale gas production to rise. United Press International. “Transportation commitments from gas shippers contribute to plans to increase Haynesville shale gas production by nearly twice the current level, producers say. Enterprise Products Partners and Duncan Energy Partners announced they received the additional transportation commitments from shippers necessary to increase the capacity from their Haynesville project from 1.4 billion cubic feet per day to 2.1 billion cubic feet per day.”

Petrohawk CEO: Haynesville Shale Gas Output Hits 500 mmcfe/d. Wall Street Journal. “Petrohawk Energy Corp.’s (HK) gross output from the Haynesville Shale has reached 500 million cubic feet of natural gas equivalent a day, Floyd Wilson, chief executive of the natural gas producer, said Wednesday. … The Haynesville Shale is a rapidly developing natural gas field in Texas and Louisiana and a key operating area for the company. Natural gas production from fields such as the Haynesville have been largely credited with creating a boom in domestic natural gas output.”

Devon to accelerate Haynesville shale drilling. Oil & Gas Journal. “Devon Energy Corp. plans to accelerate drilling in its southern Haynesville shale play based upon results from a well in San Augustine County, Tex. Kardell 1H achieved an average continuous 24-hr flow rate of 30.7 MMcfd of gas equivalent through a 37/64-in. choke. Flowing pressure was 6,824 psi. The well was drilled to 18,350 ft TMD, including a horizontal lateral section of 4,500 ft. Devon operates the well with 48% working interest. Crimson Exploration Inc. owns the rest.”

Fear not, folks: Massive flame was supposed to be there. Pittsburgh Tribune-Review. “Anyone who might have noticed a 25-foot-high flame shooting into the sky off Route 422 near Worthington in the area of Creekside Mushrooms the past few days can rest easy — it wasn’t a house on fire. It was a Marcellus Shale gas well operated by Snyder Associated Companies being “flared.” A crew from Texas has been watching the controlled natural gas burn around the clock. “It’s been getting a lot of interest,” said Dave O’Hara, a company spokesperson. “People see it and want to know what it is. There is also a lot of interest in the gas coming from the Marcellus Shale.”

Pipeline public hearing draws 50 residents with questions on safety, oversight. Syracuse Post-Standard. “Residents raised questions about environmental impacts, oversight and public safety at a hearing on a proposed natural gas pipeline held by the state Public Service Commission in the town of Lebanon tonight. A crowd of 50 filled the sanctuary of the New Life Church in Randallsville to voice their opinions on an 8.2-mile pipeline between the towns of Eaton and Lebanon that would transport larger quanties of natural gas harvested from wells in Madison and Chenango counties. … Some residents asked about the impact of hydrofracking, the process used to extract natural gas from the Marcellus shale rock formation, raising concerns of contaminated drinking water, polluted groundwater and the impact of heavy equipment and trucks on local roads.”

Brewster: ‘No tax hike, period’. Pittsburgh Tribune-Review. “Mayor James Brewster said the final budget and accompanying budget message won’t be ready until council’s Dec. 2 voting meeting. Will he hold the line on taxes? “Absolutely,” Brewster said. “There will be no tax increase, period.” … However, city officials also anticipate MACM being able to accommodate waste water that could be trucked in from Marcellus Shale drilling projects. Brewster said the city anticipated possibly taking in $10,000 in Marcellus Shale-related income in the coming year but could get far more in the future. “This potential revenue is a half-million to a million dollars a year, if we have access to it, if we have rights to it,” the mayor said. He wants to have companies come in to make gas drilling presentations to council.”

DEC hearing on drilling draws passionate response from both sides. Ithaca Journal. “Chris Tate of Hector believes hydro-fracturing, a process used in extracting natural gas from the Marcellus Shale formation, is an environmental disaster waiting to happen. On the other hand, Mike Gustina of Hornby would have no problem allowing drilling on his property. Both men were among about 400 people who crowded into the auditorium at Corning-Painted Post East High School on Wednesday evening for the fourth and final public hearing on the Department of Environmental Conservation’s draft for state regulation of the drilling process.”

Gas drilling concerns aired at DEC hearing. Corning Leader. “A debate raging across the state took center stage in Corning on Wednesday evening as the state Department of Environmental Conservation held a public hearing on its new regulations for natural gas drilling in the Marcellus Shale. … Clayton Banks, a staffer for U.S. Rep. Eric Massa, D-Corning, opened Wednesday’s hearing by reading a strongly worded statement written by the 29th District congressman that called Marcellus gas drilling an issue of “extreme significance” and said there are many concerns to be addressed before drilling should be allowed to move forward. “Given the toxicity of the chemicals used in this process and the many devastating cases of contamination we have seen around the country as a result of operator errors, there is full justification for substantial oversight and strong guidelines regulating this activity,” Massa said.”

Energy In Depth: Today’s News

Studies have shown that hydraulic fracturing poses no threat to drinking water. Energy In Depth’s Lee Fuller, Cleveland Plain Dealer. “Relying heavily on information from the advocacy group ProPublica, Stan Cox asserts in a Nov. 8 Forum article that hydraulic fracturing has contributed to the contamination of thousands of sources of drinking water. The reality is quite the opposite: In commercial use for more than 60 years now, not a single case of contamination has ever been credibly linked to fracturing. The U.S. Environmental Protection Agency confirmed its safety in a 2004 report. So have the Ground Water Protection Council, U.S. Department of Energy and other reputable sources.”

Next from ProPublica: Hydrofracturing Will Awaken Godzilla. NAM’s ShopFloor.org. “The good people at Energy In Depth, an alliance of natural gas and oil producers, have assumed the essential if unenviable task of responding to the campaign against hydrofracturing led by ProPublica. The activist journalistic outfit’s latest piece raises a scare about natural gas from shale deposits in New York being radioactive. RADIOACTIVE! The story is “Is New York’s Marcellus Shale Too Hot to Handle?”

Haynesville Shale activity creates job opportunities. Shreveport Times. “There are a lot of options when it comes to job opportunities in the oil and natural gas industry. While the economic downturn has slowed oil and natural gas activity throughout most of the country, the Haynesville Shale natural gas deposit has kept companies in northwest Louisiana. And they all need qualified employees. This area has become a haven for oil and natural gas professionals from throughout the country, said Angie White, vice president of North Louisiana Economic Partnership. “We have more oil and gas people in the area from all over because they have been laid off.”

Officials to commemorate five years of drilling in Fayetteville Shale play. Arkansas News. “’We’ve known there was natural gas in these shales for decades,’ said Ed Ratchford, senior petroleum geologist and fossil-fuel supervisor for the Arkansas Geological Survey. But tapping the reserves was not economically feasible until service companies like Halliburton and Schlumberger developed hydraulic fracturing technology to pull gas from “unconventional” wells, such as Fayetteville Shale, Ratchford said. Southwestern invested $28 million for leases and drilling 21 test wells in 2004, acquiring an additional 575,000 acres. A well near Jerusalem produced the first gas for an energy boom that a 2008 University of Arkansas study estimated will generate $19.9 billion and more than 11,000 jobs for the Arkansas economy through 2012.”

Mitchell’s persistence laid groundwork for shale gas surge. Houston Chronicle. “Jay Ewing was in the middle of a job interview with a manager at Mitchell Energy in its North Texas field office in 1982 when the office phone rang. On the other end of the line was company president George Mitchell, calling from The Woodlands. What ensued was an argument over whether to continue testing for natural gas in a formation called the Barnett shale — a concrete-like formation that was widespread throughout the company’s vast lease holdings. … Mitchell noticed when drilling through the Barnett that well logs would register “a kick in gas,” but engineers told him the formation wasn’t porous enough to give up whatever it held. “I’d say, ‘Let’s fracture it anyway,’” Mitchell said, referring to hydraulic fracturing — pumping hundreds of thousand of gallons of water mixed with sand and chemicals into underground formations to break them apart and release more oil and gas.”

Haynesville Shale has protected area from recession. Shreveport Times. “Northwest Louisiana residents repeatedly have heard over the past year or so how fortunate this region is to have the Haynesville Shale and its financial fortunes act as somewhat of a buffer against the national recession. Energy specialist Loren C. Scott echoed that Friday during a luncheon speech before 560 attendees of the second annual Haynesville Shale Expo inside the Shreveport Convention Center. The first to release a comprehensive evaluation of the oil and gas industry’s impact on the region, Scott put the shale into perspective, first through a detailed look at the national economic picture. “This has been a stinker,” he said of the recession that started in January 2008. “But there’s every indication we are out of it now, and we’re starting to grow again.”

Natural gas now is in the spotlight. San Antonio Express. “New drilling techniques have tapped deposits trapped in shale formations in Texas and elsewhere, prompting some in the industry to brag about a burgeoning “revolution” in natural gas. … “There’s no question that the price of natural gas has fallen significantly in the last year, and it appears that the market may have seen a fundamental shift downward in cost,” Castro said. … The drilling practices now being used actually are a combination and refinement of two old techniques: horizontal drilling and hydraulic fracturing. In Texas, the combination has been used to develop the Barnett Shale formation near Fort Worth and the Haynesville Shale, which straddles the Louisiana line. The Eagle Ford Shale in South Texas also holds promise, some in the industry say, and there are several more large formations in the United States and Canada where production is speeding up.”

Water solutions reached in Haynesville Shale play. Shreveport Times. “About a year ago, Haynesville Shale Expo speaker Gary Hanson talked about the problems ahead for water resource management in wake of the explosion of the shale play. On Friday, Hanson talked about solutions that have been reached. “There’s been a paradigm shift in the past few months in how the industry looks at water and it started here.” … Up to 7 million gallons can be used to stimulate the deep natural gas deposit, and that demand put the industry into competition with residential and commercial users. “A water market has developed in the Haynesville Shale,” Hanson said.”

Shale gas recovery progress part necessity, part innovation. Fort Worth Business Press. “Range Resources Corp.’s Mark Whitley said Barnett Shale producers could expect to recover about 1 billion cubic feet of natural gas from a well drilled about a decade ago. Today, that number is up to 3 Bcf of gas. Horizontal wells, slick-water hydraulic fracturing, longer lateral lengths and more contribute to the whirlwind of progress made in the North Texas gas play. A lot has happened in the Barnett Shale since the summer of 1982, and closing in on three decades later and 13,000 wells drilled, one thing is for certain: the learning never stops, all parties agree.”

Well Beyond the NORM

Unable to move the needle with conventional attacks, ProPublica digs deep for assault on Marcellus aimed explicitly at scaring the public

It might not be the most pleasant realization known to man, but the truth of the natural world around us is this: It’s radioactive. “Radiation,” according to one government site, “is everywhere in the universe.” And “everyone,” according to EPA, “has some minor exposure to it.”

Dirt, bricks, plants, animals, even the sun – you can find naturally occurring radioactive materials (NORM) everywhere. And since “everywhere,” last we checked, includes subterranean areas of New York, it shouldn’t come as too big a surprise that some degree of radiation is likely found 8,000-feet down in the Marcellus Shale formation as well.

Context, in this case, is key. Unfortunately, not very much of it made its way into the latest anti-energy piece filed this week by ProPublica. According to author Abrahm Lustgarten, the idea that some radiation would be found in (naturally occurring) groundwater deposits thousands of feet underground was a “troubling discovery” for officials in New York – and one, he argues, the state is wholly unprepared to manage:

“It is not clear which treatment plants, if any in New York, are capable of handling such material.”

“The DEC has yet to address any of these questions.”

“[T]hey have yet to say how they’ll deal with it.”

Indeed, reading through the ProPublica piece, one starts to wonder how New York’s Department of Environmental Conservation (DEC) could’ve made such an obvious oversight; how the agency could’ve spent nearly three years, and millions of dollars, developing an 804-page draft regulations document without even considering how issues related to NORM would be handled.

But then you take a second to read the actual DEC document. And you start coming across passages like this:

The discharge of radioactive material into the environment is regulated by DEC. … [A]ny discharge of effluents into the environment will need to be tested for NORM concentrations prior to discharge.

Read that sentence again: Under DEC’s draft rules, not a drop of wastewater will be allowed to leave the wellsite without first being tested. But what happens when it gets to the wastewater treatment facility? According to Lustgarten, that’s when things get really unsettled – since not a single treatment plant in central New York, per his accounting, is even capable of accepting water with high levels of NORM:

ProPublica contacted several plant managers in central New York who said they could not take the waste or were not familiar with state regulations.

Interesting. But before we throw up our hands and call the whole thing off, isn’t it worth asking how high these NORM levels actually are? There’s got to be a government agency out there, somewhere, that’s taken the time to test the groundwater buried in the Marcellus. There’s got to be a group of environmental engineers, somewhere, that’s taken a hard look at what level of NORM is safe for the public, for workers, for the environment, and what isn’t. There’s just got to be, right?

Right. It’s called DEC. And here’s what the 3,500-employee agency found after it conducted a two-year study and field review process seeking to characterize and quantify the presence of NORM in the Marcellus Shale:

To determine NORM concentrations … [DEC] conducted field and sample surveys … which indicate levels of radioactivity that are essentially background values, [and] do not indicate an exposure concern for workers or the general public associated with Marcellus cuttings.

Although the largest volume of NORM is in produced waters, it does not present a risk to workers because the external radiation levels are very low.

So, to recap: Not only does DEC have a regulatory apparatus and permit-issuing structure in place, right now, to handle issues related to NORM, but it spent the better part of the last two years testing and re-testing core samples from the Marcellus to ensure the levels of NORM associated with both the shale rock and the attending groundwater met accepted standards of health and safety.

Make no mistake: NORM is an issue that producers of energy have always taken very seriously – and one that states, communities and the federal government have studied, regulated and monitored extensively for decades. Why would any of that change in New York?

Energy In Depth: Today’s News

Congressman speaks about dairy farmers, health care reform. Williamsport Sun-Gazette. “U.S. Rep. Glenn “GT” Thompson, R-Howard, talked about a lot of things at the annual GROW dinner here Thursday, but the most compelling thing he said was about the plight of the state’s dairy farmers, and the need for meaningful health care reform, which he said could not be found in the House-passed health care bill. … One thing Thompson said he disapproved of was an “anti-fracking” bill introduced by Sen. Casey, which he said would stifle the natural gas industry just beginning to show results in harvesting the natural gas in the Marcellus Shale, which he said is “the largest gas play in the world,” helping make the nation energy independent. “Fracking has been done for a hundred years, and it is safe. The problems come when producers don’t follow the rules. We need to hold their feet to the fire on that,” he said.”

Federal legislation bears watching, Oklahoma executive says. The Oklahoman. “Vigilance was the buzzword Thursday when a Devon Energy Corp. executive offered an update on federal legislation at the annual meeting of the Mid-Continent Oil and Gas Association of Oklahoma. “We have to be vigilant and we have to be strong in our views,” said Bill Whitsitt, who is Devon’s executive vice president of public affairs. … Whitsitt said the industry is under attack by its critics.  Hydraulic fracturing — a now universal method of unearthing oil and gas deposits — has been the subject of a “skillfully orchestrated campaign of misinformation” by people who oppose the continued use of fossil fuels, he said. The so-called FRAC Act that would make it tougher for producers to continue that practice is on the back burner in Washington, but Whitsitt said it still bears watching. … “This is a game-changer across the country,” he said. “It has the promise of long-term energy supply stability for the United States.”

Horseheads site interests new gas firm. Elmira Star-Gazette. “Kayden Industries USA expects to begin construction of a 6,200-square-foot building next week. The floor plan includes office space and an area to service the centrifuges the company builds in Canada and that are used in local gas drilling operations. The centrifuges separate solid materials from the fluids used in natural gas or oil drilling operations, said Kayden USA President Myles Lawrence. With the solids removed, the drilling fluids can be re-used and that can reduce the amount of water required for drilling purposes by about 70 percent.”

Quicksilver says West Texas Barnett field more difficult than North Texas’ shale. Fort Worth Star Telegram. “Quicksilver Resources’ drilling program in the natural gas-rich Barnett Shale in North Texas “is really going well,” propelling the company’s rising production, CEO Glenn Darden told investment analysts in a conference call this week. Fort Worth-based Quicksilver, an independent natural gas producer, has extensive lease holdings of 375,000 net acres in the Delaware Basin in Culberson, Jeff Davis and Reeves counties in far West Texas, where the company’s chief exploration target is none other than the Barnett Shale. But the West Texas stretch of the Barnett is proving much trickier to drill and complete successful wells in than the North Texas Barnett. In West Texas, the Barnett formation has a higher clay content that makes successful hydraulic fracturing of wells — part of the well-completion process that follows drilling — a much more dicey proposition.”

Broome Bar Association Talks About Gas Drilling. WBNG-TV. “Attorneys in Broome County too the opportunity to learn more about oil and gas leasing. They attended this legal education seminar at the Regency in Binghamton. New York Attorney General’s Office teamed up with the Broome County Bar Association. They wanted to give attorneys information about issues surrounding oil and gas drilling.”

Energy In Depth: Today’s News

Garfield County: No rules on fracing. The Durango Herald. “While La Plata County has struggled to define its position on hydraulic fracturing, Garfield County is clear: no federal regulation. Commissioners of the heavy natural gas-producing county this week approved a resolution that opposes legislation in U.S. Congress that would bring the practice under regulation by the Environmental Protection Agency. Fracing entails pumping sand, water and chemicals into rock formations at high pressure to break them open and release gas.”

McKeesport Mayor: Marcellus Shale may be moneymaker. Pittsburgh Post Gazette. “The solution to McKeesport’s budget woes may be far below the ground. Mayor Jim Brewster has been in discussion with several natural gas companies to lease city land and gas rights, and he believes that could help fill in budget gaps without raising taxes, city administrator Dennis Pittman said. “The mayor has met with several companies,” he said. “We want to make sure that we have someone who’s got a track record and capacity to deliver.” … McKeesport sits on top of the Marcellus Shale, a natural gas-rich rock formation deep beneath the surface. Gas is extracted by a procedure called fracking, in which water is blasted against the walls of a deep well, releasing the gas. What is advantageous about the process is that gas companies can access acres of the rock formation through relatively small holes in the surface. “Once the drilling’s been done — the above-ground edifice is only one story maximum — everything’s done underground,” he said.”

Shale gas transforms energy picture. Reuters, Op-Ed. “Nothing illustrates technology’s power to transform the energy outlook more clearly than the development of the Barnett shale gas deposit under the city of Fort Worth in Texas. The resulting increase in U.S. gas output has made a decisive contribution to the “unexpected boom” in North American gas production and the emergence of a worldwide “gas glut,” cited by the International Energy Agency (IEA) in its World Economic Outlook (WEO). … Much of the surge has come from rapid growth in shale gas. While total U.S. gas production rose 1,288 billion cubic feet (bcf) between 2007 and 2008 (6.7 percent), the shale component leapt by 838 bcf (70 percent) and accounted for two-thirds of total growth.”

Texas oil baron sees gas as game changer. Calgary Herald. “North Americans need to embrace natural gas as the clean-burning solution to North America’s energy and environmental security, one of the world’s leading oilmen told the Calgary Herald’s editorial board Tuesday. T. Boone Pickens, one of the world’s foremost oil barons, is hoping to convert more than seven million heavy trucks and vehicles over to the cleaner-burning fuel in an attempt to reduce U.S. reliance on imported oil. … Pickens described North America as the “Saudi Arabia” of natural gas, with more than 100 years of potential supplies. … However, much of it is locked in unconventional rocks like shale that require specialized drilling techniques to bring it out. According to the International Energy Agency, which released its 2009 World Energy Outlook on Tuesday, unconventional gas–notably shale gas–in North America has transformed the gas market outlook. “Unconventional gas is unquestionably a game-changer in North America with potentially significant implications for the rest of the world,” said IEA executive director Nobuo Tanaka.”

Coal, Gas Supplies Abound Across Our Region as Winter Nears. State Journal, Op-Ed. “Imagine what will happen when operations here in the Marcellus shale finally are able to crank at the speed and capacity of those in the Barnett Shale near Dallas. That’s where this process of multi-stage well fracturing and ultra-deep horizontal drilling first began to hit its stride. … On the supply side, the technology is there. The natural gas in North America seems limitless. … The best deal is for the consumer. Long term, more natural gas means cheaper everything. And if we can keep the EPA from declaring shenanigans and wanting to review every new hole punched in the ground by a drill, we can all save some money.”

Haynesville Shale Expo expands into full day. Shreveport Times. “A year ago, the Haynesville Shale was still somewhat of a novelty in that northwest Louisiana residents still were trying to understand the ramifications of the natural gas find in their everyday lives. The first Haynesville Shale Expo, held last fall, helped those with lingering questions by bringing together scores of oil and natural gas operators in exhibit settings and guest speakers who touched on topics such as Haynesville Shale 101 and mineral rights that were foremost on everyone’s minds at the time. The past year has brought knowledge and experience in shale operations, and the interests have shifted.”

Haynesville Shale play doesn’t have to be a win-lose proposition. Shreveport Times, Editorial. “DeSoto Parish, the heart of the Haynesville Shale play, this week offered a sampling of the benefits and challenges that this natural gas bonanza brings. … The Haynesville Shale has been an unexpected and welcome boon to northwest Louisiana amid a worldwide economic recession. It’s meant bonus checks to landowners and hundreds of well-paying jobs added to the local labor market. Shawn Helon, of EnCana Oil &Gas, also notes that his company has paid almost a half million dollars in severance taxes this year and $180,000 in road repairs. … The Haynesville Shale doesn’t have to be a win-lose proposition. There is an appropriate balance between helping develop this industry and the reasonable cost of doing business. Pulling natural gas from the ground will enrich many people, but it shouldn’t come at the expense of the land and people by sacrificing the region’s environment.”

Cornell faculty holds off on Marcellus resolution. Elmira Star-Gazette. “Should Cornell University use its power to advocate for stricter regulation of gas drilling in the Marcellus Shale, or should the university remain an unbiased provider of scientific information? Those were among the issues debated by Cornell’s Faculty Senate on Wednesday, as the body considered a resolution that would have, among other things, urged New York state to carry out more study, regulation and taxation of gas companies before any unconventional gas drilling is allowed in the state.”

Energy In Depth: Today’s News

Regulating Gas Drilling. New York Times, EID’s Lee Fuller. “’The Halliburton Loophole’ (editorial, Nov. 3), about hydraulic fracturing, dismisses a 60-year record of safety with the utterance of a single word: Halliburton. Regulation of fracturing, a natural gas drilling process in use since the 1940s, has always been left to the states, not the Environmental Protection Agency. The Times endorses legislation that it says will “restore” E.P.A. authority over the process. But how can you restore something to the E.P.A. that it never had in the first place? The campaign to empower the E.P.A. with authority over fracturing is an effort to shut down the process in its entirety. That’s why The Times supports it, and why the rest of New York shouldn’t.”

Gas Drilling: Is It Worth It? WNEP-TV. “There’s a rush of money and activity pouring into the northern tier of our area and it revolves around the quest for natural gas. Already gas companies have signed leases for around one billion dollars with landowners in our area. Whether they like it or not, a lot of the locals are calling it an invasion. Natural gas companies are putting their massive drill rigs in spot after spot, drilling for a product that has transformed the landscape of rural Susquehanna County in so many ways. … A natural gas boom is clearly underway. “This is a phenomenal difference. It will change the whole characteristic,” said Carl Fuller of Dimock Township. … “The problem for me is how to divide it among kids and grandkids!” Jayne said. … The general store is just one business benefiting from the hundreds of workers flooding the region related to the drilling. “It’s going to change a lot of lives around here,” Fenton added. “It’s helped a lot of people, I know that. So we’re thankful for them.” “They’re putting millions of dollars in and they wouldn’t be putting it in unless there was something here,” added Carl Fuller. This is just the start. Gas companies have signed millions and millions of dollars in leases with landowners and the drilling is yet to come.”

Saskatchewan oil play gains momentum. Globe and Mail. “Forget the oil sands: Arguably the hottest chunk of oil real estate this year sits in the pasture and wheat fields of southern Saskatchewan. Far from Alberta’s Fort McMurray, Saskatchewan’s Bakken oil field was, until five years ago, thought of as a dud. Wells drilled into its dense rock produced five, maybe 10 barrels a day. But, in a mirror of the revolution that has overtaken North American natural gas production, technological change has brought great new volumes of crude surging to the surface, and a flurry of deals to match. … That technology involves the use of horizontal wells and multistage fracturing, a method that pumps high-pressure fluid and sand into the rock to crack it apart so oil can flow out. The first well of its kind was drilled in the Bakken in 2004, nearly 60 years after oil was discovered in the area. It worked. The Bakken now produces about 65,000 barrels per day.”

County frets over drill fluid. Jackson Hole Daily. “The board unanimously approved a resolution last week that outlined worries about hydraulic fracturing fluids and called for action. Hydraulic fracturing is a method energy companies use to get gas from geological structures by pumping fluids at high pressure into the ground and fracturing the subsurface rock. The resolution also urges Congress to pass a bill known as the FRAC Act that would, during a medical emergency, allow a physician or nurse access to chemical formulas used in hydraulic fracturing. Currently companies keep many of their chemical formulas secret. … “He believes hydraulic fracturing is essential for making many of Wyoming’s most productive fields viable, and subjecting this practice to unnecessary regulation could hurt our state’s economy at a time when we are seeing drastic budget cuts,” Pickett said. … “In 2004, the EPA reported that no evidence has been found linking the practice of hydraulic fracturing to the contamination of underground drinking water,” Lummis said.”

Pickett co-chairs hearing on gas drilling. The Morning Times. “To learn more about the Marcellus Shale natural gas formation and the various water issues that local residents, municipalities, and water and sewage treatment systems are facing, state Rep. Tina Pickett, R-Wysox, Monday co-chaired a hearing and listened to presentations from industry executives and environmental regulators. “Many of my colleagues and I have been walking through the inquiries from our constituents regarding the water issues they are facing with regard to the Marcellus Shale,” said Pickett. “Issues range from local water quality and watershed management to proper disposal of the water used for hydraulic fracturing purposes. We need to ensure that while the drilling may be advantageous to our local economy, that we are not putting our environment and natural resources at risk.”

Gazprom Has ‘Everything’ in Place to Avoid European Gas Cuts. Bloomberg. “OAO Gazprom, the world’s biggest natural-gas producer, expects to maintain contracted supplies to Europe this winter, avoiding a repeat of a dispute with Ukraine that disrupted shipments in January.  “We have everything” in place to ensure there will be no renewed conflict, as long as Ukraine remains “in compliance with the transit and offtake obligations,” Deputy Chief Executive Officer Alexander Medvedev said yesterday in a Bloomberg Television interview in Washington. … Companies including Chesapeake Energy Corp., BP Plc, Royal Dutch Shell Plc and Statoil ASA are investing in such gas resources, which were inaccessible until producers developed new drilling techniques in the 1990s. “We are not afraid of competition, we are used to it,” Medvedev said. The U.S. needs LNG as well as other sources of gas, he said, adding that Gazprom is “carefully analyzing” the development of shale gas extraction in the country. “The question is not who will replace whom, but how it will be combined.”

Ithacans Weigh Pros and Cons Of Large-Scale Drilling Project. The Cornell Daily Sun. “With the prospect of a large-scale gas drilling project in Ithaca, many residents have voiced concern about such a project’s potential environmental and health impacts. Despite the potential profits from leasing land to gas companies for natural gas drilling in the Marcellus Shale formation, residents have vocally raised concerns.While there are huge profits to be made from leasing land to gas companies for natural gas drilling, many residents who live atop the Marcellus Shale formation, including those in Ithaca, fear the damaging effect that such drilling will have on the environment and their health. … Recent technological innovations including the development of new gas extraction capabilities like horizontal drilling and hydraulic-fracturing (“hydrofracking”) have spawned recent interest in the Marcellus Shale — before the advent of these technologies, it would have been expensive and difficult to tap into the shale’s natural gas resources.”

Gangs of New York

Flush with falsehoods and hyperbole, anti-energy activists promise to “overwhelm the DEC” at NY Marcellus hearings this week

The problem for the dog that chases the car, it’s often said, is that sometimes he catches it.

Just ask your neighborhood anti-energy activist in New York. Bowing to pressure last week, the state’s Department of Environmental Conservation (DEC) announced it was extending by 30 days the public comment period on the agency’s draft regulations governing the safe development of clean-burning natural gas from the Marcellus – a review and rule-making process that has already gone on for the better part of three years.

It was a demand made predominantly by those who oppose the safe conversion of these homegrown energy resources into jobs, revenue and opportunity for New Yorkers – on philosophical grounds, for the most part. Naturally, the extension was granted, and as expected, environmentalists across the state applauded DEC for taking the time to get things right. Right?

Not exactly. Turns out the anti-energy crowd had no trouble catching the bumper; what it really wanted, though, was the car. And driver. This letter to the editor, typical of these groups’ response to the 30-day extension, was posted last week in the Elmira Star-Gazette:

[DEC’s] 30-day extension … falls short. A more sensible approach would be a gas drilling moratorium pending completion of a study of the issue by the Environmental Protection Agency.

Put aside the fact that EPA actually did conduct a five-year-long study of the technology involved in shale gas development, released to the public in 2004. Put aside the fact that the agency found this technology to be categorically safe, capable of posing “little or no threat” to supplies of drinking water residing thousands – in some cases, tens of thousands – of feet from areas in which fracturing activities take place. Put aside the fact that hydraulic fracturing has been in commercial use for more than 60 years now, not once in that time having been credibly tied to the contamination of drinking water.

Put aside all that. The real motivation here has nothing to do with comment periods, oversight, studies, or public participation. What it has everything to do with is shutting the process down – cold, hard and fast. And though it took them a while to work up the courage to say so, some activists in New York – including the president of the Manhattan Borough – are starting to ‘fess up to that true intent of this entire campaign:

Join Manhattan Borough president Scott Stringer’s Kill the Drill campaign. … Please join us at a rally and press conference in front of the school at 5:00pm.

Scott Stringer’s “Kill the Drill” campaign? Doesn’t sound much like Scott Stringer’s “Extend the Comment Period” campaign to us. Of course, if Mr. Stringer was the only source of information we had on the safety and performance of hydraulic fracturing, we’d be worried about the process as well. This week, he posted a snazzy new video on the Huffington Post claiming that shale gas exploration “causes mini-earthquakes to extract the gas.” Worse than that, the process has contaminated “watersheds across the nation with plastics, carcinogens, mutagens, and endocrine disrupting chemicals.”

Of course, it’s doubtful that Mr. Stringer caught the piece in the Dallas Morning News this past August debunking the claim that fracturing has anything to do with earthquakes. And naturally, he doesn’t take the time in his video or accompanying press release to back up his assertion that “secret” fracturing activities have contaminated “watersheds across the nation.”

But just in case his curiosity gets the better of him: DEC lists the materials used in the process here (page 130); Pennsylvania’s DEP does the same; the Ground Water Protection Council (GWPC) offers up the following on its site (page 62); and Energy In Depth breaks it down in a fact sheet as well.

One last point about Mr. Stringer’s “rally and press conference” going down at 5:00 pm: That’s happening TODAY at 5:00 pm, at Stuyvesant High School on Chambers Street in New York City. And it’s shaping up to be quite a party, too. This “tweet” comes from a major anti-energy activist in the state:

WE MUST OVERWHELM THE DEC AT THE NOV. 10TH MEETING ON DRAFT SGEIS AT STUYVESANT HIGH SCHOOL 6PM, 345 CHAMBERS ST – BE THERE & FIGHT THE FRAC!

Maybe when we’re done with that, perhaps we can fight the caps lock as well?

Notwithstanding the circus expected tonight, New York residents interested in showing up to defend their property rights and speak out in support of responsible energy access have a few more bites at the apple in the weeks ahead. This schedule, posted on DEC’s website and excerpted below, is up-to-date. Additionally, folks can go here to submit a comment (until Dec. 31) – one we’re told will actually be read by someone in the department.

Tuesday, November 10, Stuyvesant High School, NYC

Thursday, November 12, Chenango Valley High School, Chenango Bridge, NY

Wednesday, November 18, Corning East High School, Corning, NY 14830.

So there you have it: The battle lines have been drawn, and the dates, times and venues for the fight have been established. Now it’s up to us to show. We know they will. And we know they’ll be in need of some half-decent facts when they get there.

READ MORE 

• Study: Potential Economic and Fiscal Impacts from Natural Gas Production in Broome County, NY
• Issue Alert: Sign of the Times
• Fact Sheet: HF Opponents Say the Darndest Things
• Press Release: Duplicative hydraulic fracturing rules could imperil U.S. economy
• Wyoming Memo: Mind the O-Gap
• GWPC Study: State Oil and Natural Gas Regulations Designed to Protect Water Resources
• Graphic: How Far Down Do We Frac?
• Graphic: What’s In Frac Fluids?
• EPA Study: Study to Evaluate the Impacts to USDWs by Hydraulic Fracturing of Coalbed Methane Reservoirs
• Browner Memo: Letter of Support for Hydraulic Fracturing from Carol Browner, Fmr. EPA Administrator

Energy In Depth: Today’s News

GarCo votes against regs on fracturing by the feds. Grand Junction Sentinel. “In a decision being cheered by the energy industry and lamented by some area residents, the leading natural-gas-producing county in Colorado has come out against legislation to federally regulate hydraulic fracturing of wells. Garfield County commissioners voted 2–1 Monday in opposition to legislation proposed by U.S. Rep. Diana DeGette, D-Denver. The bill would subject fracturing to the federal Safe Drinking Water Act and require disclosure of chemicals used in the process. … “Every time the federal government gets involved, the cost goes up,” Samson said. “I know of nothing that the federal government does for us that does not cost money.” … The Colorado Oil & Gas Association said in a news release that Garfield Co. joins Delta, Mesa, Moffat, Morgan, Rio Blanco, Washington, Weld and Yuma counties in opposing DeGette’s bill.” NOTE: Click HERE to view COGA’s release.

Garfield County withholds FRAC Act support. Glenwood Springs Post Independent. “Despite evidence of significant sentiment to the contrary among the electorate, two Garfield County commissioners voted this week to oppose federal legislation which would put the oil and gas industry partly under the control of the Environmental Protection Agency. The lone Democrat on the Board of County Commissioners, Trési Houpt, declared her support for what is known as the FRAC (for Fracturing Responsibility and Awareness of Chemicals) Act, introduced in both houses of Congress last summer. … “Do you want to have the federal government come in and tell you what’s going to happen?” he asked the crowd of 25 or so at the meeting, or should it be left to what he called “the local voice”?”

Range posts Marcellus safety drill video. Washington (PA) Observer-Reporter. “Range Resources Corp. said Monday it has posted a video to its Web site, www.rangeresources.com, describing a first-of-its kind, large-scale safety drill in the Marcellus Shale play recently conducted in Lycoming County. The company said in a news release that state Sen. Gene Yaw filmed and produced the video and is sharing it with multiple outlets to benefit first responders across the state. Yaw is a member of the Senate Environmental Resources and Energy Committee and represents Lycoming, Bradford, Susquehanna, Union and Sullivan counties, where drilling is occurring in the Marcellus Shale play.” NOTE: Click HERE to view this video.

Oilman says ND reserves could be double estimates. Associated Press. “Billionaire oilman Harold Hamm believes North Dakota’s oil reserves are double the federal government’s estimates. Hamm was the keynote speaker Monday at an energy conference in Bismarck. He said the U.S. Geological Survey’s estimate of 4.2 billion barrels of oil in the Bakken shale formation could be “100 percent off.” Hamm is the chairman and chief executive officer of Continental Resources Inc., an independent oil and gas company based in Enid, Okla. His company was one of the first to tap the Bakken formation in North Dakota’s oil patch 20 years ago. … Hamm also said he believes domestic reserves are growing, and not just in North Dakota.”

Let Me Get A Big ‘Shale, Yeah’. Wall Street Journal. “Shale and other types of unconventional gas production account for about 40% of overall U.S. gas production, up from around 10% in 1990, thanks to advancements in horizontal drilling and rock-cracking, as chronicled in a recent Wall Street Journal report. At least three shale-related private equity transactions were announced last week. EnCap Investments LP, Flatrock Energy Advisors LLC and TPH Partners have launched a new company, Meritage Midstream Services, focused on the Eagle Ford Shale in south Texas. Meritage will provide oil and gas producers with services like gathering and treating gas, oil, condensates and water. It also will provide carbon dioxide sequestration.”

Environmental agency facing $58M loss responsible for monitoring gas-drilling boom. Washington (PA) Observer-Reporter. “As the state Department of Environmental Protection works its way through a $58 million funding cut, its press secretary said last week that the agency will be able to maintain its oversight over natural gas well drilling activities in the state’s Marcellus Shale play across Pennsylvania. … Range Resources spokesman Matt Pitzarella said the company went from paying about $80 for a drilling permit to about $2,000. “It was set up in such a way so that as drilling levels go up, the inspector numbers go up,” he said. “It’s a self-funding mechanism.”

LOGA president pledges support for DeSoto road solution. Shreveport Times. “Louisiana Oil & Gas Association President Don Briggs got a personal tour Monday of DeSoto Parish’s roadways that are disintegrating under the weight and volume of truck traffic generated by the Haynesville Shale play. And he saw the complaints from parish officials are justified and magnified beyond what he expected based on what he’s been hearing at his Baton Rouge office. “There’s no question that this is a major issue,” Briggs told DeSoto police jurors following his afternoon road trip with Superintendent Clinton Sharpley. “It’s much more so than I realized.”

Energy In Depth: Today’s News

IPAA advocates fact-based hydraulic fracturing study. Oil & Gas Journal. “The Independent Petroleum Association of America will work to ensure that an upcoming study on hydraulic fracturing is scientific, based on facts, and includes input from the oil and gas industry as well as state regulators. Various speakers at IPAA’s annual meeting in New Orleans discussed the attention and concerns raised by some members of Congress and some environmental groups about fracing and its safety. Water management issues have come into play because of suggestions by some industry critics that fracing chemicals might get into ground water. There has been no definitive evidence of that in various studies that have been done.”

API publishes guidelines for safe fracing. Fort Worth Business Press. “Less than a month after the state of Pennsylvania fined a gas exploration and production company more than $50,000 for spilling chemicals during drilling, the American Petroleum Institute has published, for the first time, its suggested guidelines on how best to drill and hydraulically fracture wells without damaging the environment, even while the debate about who gets to regulate hydraulic fracturing – state or feds? – continues. The API published a 36-page document, titled API HF1: Hydraulic Fracturing Operations–Well Construction and Integrity Guideline, intended to offer best-industry practices for the proper drilling and cementing of wells that are being hydraulically fractured while ensuring that shallow groundwater aquifers and the environment are protected throughout the drilling processes and beyond. “These are general principles or guidelines that will result in a good well,” said Andy Radford, an API senior policy adviser.” NOTE: Click HERE to view this document on-line.

Natural gas should be the vehicle fuel of the immediate future. Grand Junction Daily Sentinel, Sen. Mark Udall and T. Boone Pickens. “Too often in Congress, and in our political debate, people stake out a position and, in the course of defending that position, refuse to credit anything their opponent is saying. We’ve all seen that. When it comes to passing a clean energy plan for the United States, we need to take a broader, longer look at all of the tools we have at our disposal to accomplish two very important goals: Enhancing national security and reducing our dependency on foreign oil. … With recent improvements in the techniques and technology to recover natural gas from the enormous shale deposits under the continental United States, studies indicate we could have natural gas deposits that would last for more than 100 years. This is a sea-change from what we thought our natural gas reserves were prior to being able to utilize these so-called “shale plays.”

All change as gas reserves soar. BBC News. “Natural gas, more than any other fuel, is an option we have here and now,’ he tells the BBC in an interview. And, he adds, there is plenty of it around – unlike scarcer resources such as oil and coal. Given that Mr Bjornson heads up the gas division at the Norwegian energy giant Statoil, it comes as no surprise that he should hail the virtues of gas. … New techniques have been developed, where liquid, chemicals and sand is injected horizontally into shale rock to break open pathways for the gas to leak to the surface. The shale gas reserves are expected to boost economic growth, help reduce carbon emissions and reduce US dependence on energy imports, Mr Dea predicts.  ”It is truly a win-win-win situation,” he says. … “We look at shale gas as a potential game changer.”

La. will profit from shale. The (LA) Advocate. “State officials say a north Louisiana natural gas cache is continuing to generate income for state government. State Natural Resources Secretary Scott Angelle said the Haynesville Shale field is helping flatten out the rate of decline in revenues from oil and gas production. But the state is maybe five years away from the tax income that would help prop up state revenues, Angelle said. New drilling techniques unearthed in north Louisiana possibly one of the largest natural gas fields in history.”

Interest soars across state in Marcellus Shale drilling. Centre Daily Times. “Susquehanna County is “inundated.” That was the word chosen by MaryAnn Warren, a county commissioner, to describe Marcellus Shale natural gas exploration in the county, situated in one of the busiest drilling areas in the state. “Susquehanna County is inundated with drilling, fracking, water trucks, residual waste trucks and more companies coming in,” Warren said. “People are going to get rich, but I am worried about our natural resources.”  State Department of Environmental Protection figures show the number of Marcellus Shale gas drilling permits issued statewide has more than tripled this year. About one-third of the permits have been issued for sites in the Northern Tier counties of Susquehanna, Bradford and Tioga.”

Gas producers aim to hold steady. Casper Star-Tribune. “Natural gas production levels in Wyoming have mostly held steady this year in the midst of a huge drop in drilling activity. Now some of the major players are making steps toward moderately increased levels of drilling for 2010. “We’re relatively upbeat about the Rockies right now, because of the differentials and pricing we’re seeing are a lot better than they’ve been in the past. The transportation out of the Rockies is better, and that improves the economics of production in Wyoming,” said Chip Minty, spokesman for Devon Energy. Wyoming’s Consensus Revenue Estimating Group recently issued a cautiously optimistic forecast noting that this year’s natural gas production may be slightly higher than 2008. Rather than a big rebound in 2010, “the recovery is expected to be gradual,” according to CREG’s revenue forecast.”

Shale gas could be greener alternative. BBC News. “Next month, world leaders head to Copenhagen searching for solutions to climate change and ways to reduce carbon emissions. Conventional energy providers such as Statoil, Norway’s oil giant, are searching for greener alternatives. One possible solution could be unconventional gas sources such as shale gas. Large deposits of the gas are being exploited in the US, where new hydraulic fracturing technology has made it viable, and it is hoped that it could provide 50% of supply in the country in 20 years.”

Pipelines a must for Marcellus drilling to take place. Ithaca Journal. “Drilling rigs and tanker trucks won’t roll into the Southern Tier to extract wealth from the Marcellus Shale until pipelines have been laid to keep it flowing. That will be no small task. According to information from the state Department of Public Service, pipeline permitting applications could quadruple from current levels as multi-national energy companies lay the infrastructure to tap the Marcellus. State regulators anticipate a network of them crisscrossing the Southern Tier to be built before Marcellus wells are developed.”

Energy In Depth: Today’s News

More Oversight Sought for Hydraulic Fracturing. New York Times. “Environmentalists are beefing up efforts to increase regulation of a controversial oil and gas drilling technique as interest grows in tapping vast natural gas fields across the country. … At issue is the hydraulic fracturing drilling process, a decades-old technique that blasts a mix of water, chemicals and sand or plastic beads into compressed rock to open cracks and release trapped oil or gas. Hydraulic fracturing has been used for decades to improve production at aging wells and has recently been used to tap unconventional shale reservoirs like the Barnett in Texas, Marcellus in Appalachia and Haynesville in Louisiana. … “The additives involved in fracturing are used to change the surface tension of the water — a function of the fact that, under normal conditions, it’s not the easiest thing in the world to coax water 10,000 feet down a well. In shallower plays, alternate materials are absolutely used,” said Chris Tucker, a spokesman for Energy In Depth, an industry-backed group, in response to the report’s suggestion to replace chemicals with safer alternatives.”

Another natural gas discovery in north Louisiana could rival the Haynesville Shale. Times-Picayune. “Another natural gas discovery in north Louisiana could rival the Haynesville Shale, which last year incited a gold-rush style drilling boom when it was revealed that the underground rock layer held one of the biggest gas reserves in the country. The presence of the mid-Bossier Shale – which is stacked on top of the Haynesville, about 500 feet closer to the earth’s surface – was no secret among energy producers. In fact, prospectors were actually looking to tap the mid-Bossier Shale when they realized the potential of the Haynesville Shale below it, said Joan Dunlap, a spokeswoman for Houston’s Petrohawk Energy Corp., one of the biggest landholders in the Haynesville area.”

In northern counties, Marcellus Shale brings wealth, worry. Patriot-News. “Susquehanna County is “inundated.” That was the word chosen by MaryAnn Warren, a county commissioner, to describe Marcellus Shale natural gas exploration in the county, situated in one of the busiest drilling areas in the state. “Susquehanna County is inundated with drilling, fracking, water trucks, residual waste trucks and more companies coming in,” Warren said. “People are going to get rich, but I am worried about our natural resources.” Stephen Rhoads, president of the Pennsylvania Oil and Gas Association, said Wednesday that the Marcellus “play” in Pennsylvania is still in its infancy. He said the limited permitting and drilling statistics compiled to date are not sufficient to show a trend, although he expected to see an increase in the number of permits and the number of wells drilled.”

State-issued Marcellus Shale gas well drilling permits increase 300% in 2009. Patriot-News. “Nearly 1,600 Marcellus Shale gas well drilling permits have been issued by the state so far this year, more than triple the number issued in all of 2008. The statistics, compiled by the state Department of Environmental Protection, show that about one-third of the permitting activity this year has occurred in three northern tier counties, Susquehanna, Tioga, and Bradford. For Susquehanna County Commissioner MaryAnn Warren, the Marcellus Shale natural gas exploration boom is great and worrisome at the same time. As permitting and drilling have increased, her county has seen a massive influx of well drilling-related equipment and manpower. The county, she said, is inundated with drilling and hydraulic fracturing or “fracking” activity, water trucks, residual waste trucks, and more and more companies looking to make money off the natural gas trapped in the shale thousands of feet below the county.”

Marcellus Shale Drilling Has Critics & Supporters. KDKA-TV. “How would you feel if your neighbor did something that made him rich, but damaged the value of your property? That’s what’s going on in parts of Greene County and Washington County where drilling for natural gas in the so-called “Marcellus Shale” deposit is creating thousands of jobs and turning farmers into millionaires. But critics say it’s also scarring the land, creating noise and dirt and pitting neighbor against neighbor. They rise 150 feet in the air, towering over farms, but the big rig and its drilling is no bother to horse farm owner Roji Hoskin.”

Sign of the Times

NY Times – America’s “paper of record” – re-writes history of hydraulic fracturing, uses schoolyard attacks to defend endorsement of DeGette’s FRAC Act

The New York Times prides itself as the paper of record in the United States, an outlet entrusted with setting the news and opinion agenda for the nation thanks to its uncommonly high standards of accuracy and fairness. But if yesterday’s editorial offering on hydraulic fracturing is any indication, the paper’s definition of “all the news that’s fit to print” has apparently loosened up a bit over the years — so as to render itself completely unrecognizable relative to its former self.

That’s the only conclusion one can reach in reading the paper’s editorial on Tuesday. One-part revisionist history, one-part direct advocacy on behalf of the FRAC Act, the piece adopts a familiar tactic among opponents of responsible energy development: Break off legitimate debate, scurry off to the closest, safest corner, and commence launch of ad hominem attacks upon those with whom you disagree. This section is typical of the piece:

Among the many dubious provisions in the 2005 energy bill was one dubbed the Halliburton loophole, which was inserted at the behest of — you guessed it — then-Vice President Dick Cheney … It stripped the Environmental Protection Agency of its authority to regulate … hydraulic fracturing.

Quite a story to tell: Unfortunately, not a single bit of it is true. Hydraulic fracturing has never been regulated nationally by EPA – not today, not before the bipartisan 2005 energy bill passed (supported by then-Sen. Barack Obama), not at any point during the 35-year run of the Safe Drinking Water Act (SDWA).

As for the former vice president? He didn’t have a damn thing to do with Congress’s decision to clarify the intent of SDWA as it related to fracturing; that honor goes to a fella named David Ludder, whose mid-1990s lawsuit on hydraulic fracturing created the need for Congress to provide one final stroke of guidance on what SDWA was written to do, and what it was not.

Thankfully, fracturing continues to be aggressively regulated by the states through their respective groundwater protection programs – and has been since the technology was first invented. How can something earn an exemption from a law that never regulated it in the first place? That’s what EID member Dennis Lathem of the Coalbed Methane Association of Alabama wants to know in a letter he submitted to the Times — about 12 seconds after the editorial was posted on the website:

Hydraulic fracturing has NEVER been regulated under the Safe Drinking Water Act … This was never the intent of Congress and it is NOT the way EPA, state oil and gas and environmental regulators around the country believe the SDWA should be implemented.

Need more proof that EPA has never had the ability, responsibility, or (frankly) the authority to unilaterally step in and claim regulatory authority over fracturing from the states? Don’t take Dennis’s word for it – just ask former EPA administrator (and current Obama energy czar) Carol Browner. Here’s her take on the issue:

EPA does not regulate – and does not believe it is legally required to regulate – the hydraulic fracturing of methane production wells … Moreover, given the horizontal and vertical distance between the drinking water well and the closest methane gas production wells, the possibility of contamination or endangerment of [drinking water] in the area is extremely remote.

Hydraulic fracturing is a popular topic of conversation these days in New York; no fewer than 25 newspapers across the state have run articles on the Marcellus Shale, and at least 15 of them, by our count, have rendered their own editorial opinions, suggestions or observations.

But would you believe it if we told you that the venerable New York Times, with a circulation of 928,000 in print and millions more online, is the only one to suggest that hydraulic fracturing was previously regulated by EPA? The only one to parrot a claim not even ProPublica stands four-square behind any longer? The only one to uncritically accept as fact that which was previously only taken seriously by fringe groups such as OGAP and NRDC?

The old grey lady – apparently, she ain’t what she used to be. And in 150 words or less, that’s precisely the message that Energy In Depth attempted to convey in a letter to the editor submitted yesterday:

To read the Times’ editorial on hydraulic fracturing is to better understand how a 60-year record of safety can be completely dismissed with the utterance of a single word: Halliburton. Unfortunately, faced with a choice between adding substance to the debate and providing a platform for schoolyard insults, the Times took the easy way out.

Whether the Times decides to run any of these responses, it’s too early to tell for sure. Naturally, we’ve been told our submissions will be scrupulously read and forthrightly considered; less clear is whether they’ll actually be understood. If previous signed opinion pieces written by the Times’ environmental editorial writer are any indication, we shouldn’t hold our breath. Of course, that doesn’t mean we should hold our fire either.

Additional resources available at Energy In Depth: 

• Fact Sheet: HF Opponents Say the Darndest Things
• Press Release: Duplicative hydraulic fracturing rules could imperil U.S. economy
• Wyoming Memo: Mind the O-Gap
• GWPC Study: State Oil and Natural Gas Regulations Designed to Protect Water Resources
• Graphic: How Far Down Do We Frac?
• Graphic: What’s In Frac Fluids?
• EPA Study: Study to Evaluate the Impacts to USDWs by Hydraulic Fracturing of Coalbed Methane Reservoirs
• Browner Memo: Letter of Support for Hydraulic Fracturing from Carol Browner, Fmr. EPA Administrator

Energy In Depth: Today’s News

America’s Natural Gas Revolution. Wall Street Journal, Yergin & Ineson. “The biggest energy innovation of the decade is natural gas—more specifically what is called “unconventional” natural gas. Some call it a revolution. Yet the natural gas revolution has unfolded with no great fanfare, no grand opening ceremony, no ribbon cutting. It just crept up. In 1990, unconventional gas—from shales, coal-bed methane and so-called “tight” formations—was about 10% of total U.S. production. Today it is around 40%, and growing fast, with shale gas by far the biggest part. … The other technology is known as hydraulic fracturing, or “fraccing.” Here, the producer injects a mixture of water and sand at high pressure to create multiple fractures throughout the rock, liberating the trapped gas to flow into the well. The critical but little-recognized breakthrough was early in this decade—finding a way to meld together these two increasingly complex technologies to finally crack the shale rock, and thus crack the code for a major new resource. It was not a single eureka moment, but rather the result of incremental experimentation and technical skill. The success freed the gas to flow in greater volumes and at a much lower unit cost than previously thought possible.”

API issues second of four planned hydraulic fracturing guidelines. Oil & Gas Journal. “The American Petroleum Institute published a new guidance document outlining industry best-practices for properly drilling and cementing wells that are being hydraulically fractured.  The well construction and integrity guideline is designed to ensure that shallow groundwater aquifers and the environment are protected through a well’s drilling, completion, and production phases, API said on Nov. 2. It was the second of four documents that API’s standards and practices department has been developing to address hydraulic fracing’s increasing role in US energy options.”

Should We Start Swapping Coal For Gas? National Journal, Sen. Jeff Bingaman; others. “Last week, the Committee on Energy and Natural Resources held a hearing to examine the increased supply estimates for domestic natural gas from shale formations, and the contribution that those projected supplies could make to our energy security and climate protection objectives. One of the witnesses put forward a proposal to replace the least-efficient coal-fired electricity generators with newly built natural gas plants.”

McInnis lowers Pennsylvania gas boom on Ritter. Grand Junction Sentinel. “Pennsylvania Gov. Ed Rendell, who bypassed an opportunity to levy a tax on natural gas drilled in his state, has the right approach to drilling, Scott McInnis said. McInnis, a Republican who wants to be Colorado governor, pointed to Pennsylvania as a place handling natural gas differently, and better, than Colorado. He and other Republicans have been critical of Colorado Gov. Bill Ritter’s handling of energy issues, especially new rules on drilling.”

Nov. 19 natural gas drilling public meeting to be held at State Theatre. Ithaca Journal. “The Tompkins County Council of Governments reports that the location has been set for one of the two public meetings it will sponsor on natural gas drilling. The public hearing on the draft Supplemental Generic Environmental Impact Statement (dSGEIS) prepared by the New York State Department of Environmental Conservation will take place at 7 p.m. Thursday, Nov. 19 at the State Theatre, 107 W. State St.”

Special Report: Federal, state tax prospects cloud independents’ outlook. Oil & Gas Journal. “US House members launched their newly formed natural gas caucus on Oct. 21 with a hearing designed to rally support for a domestic fuel they believe could play an increasingly significant role. One witness quickly injected a note of reality into the otherwise optimistic proceedings, however. … “Natural gas, particularly shale gas, can and will play a pivotal role in America’s future energy supply. Independent producers are the key to its development,” Vincent said, adding, “If the nation’s tax, financial, resource access, and environmental regulatory policies encourage development, gas can live up to its expectations, and our country will be the better for it.” Producers aren’t the only ones feeling the impact of severely reduced drilling. States’ revenues from oil and gas taxes have dropped along with other business levies.”

Energy In Depth: Today’s News

Check facts, industry operates responsibly. Albany Times Union, IOGANY’s Brad Gill. “Your Oct. 21 editorial asks the question, “Safe drilling or risky business?” Here’s the answer: safe drilling. This letter should end here, but the Times Union, which continues to be unwilling to present balanced coverage about natural gas exploration in New York, forces a response. Again. Your frantic and reckless editorial charging that an entire industry, New York’s oil and gas operators, would avoid responsibility for an accident or spill is irresponsible and simply untrue. Because a single industry representative didn’t have every answer to every question posed by the Assembly Committee on Environmental Conservation doesn’t mean the answers are not out there. It does mean the Times Union didn’t bother to look for them before editorializing.”

Louisiana shale could change fate of US energy supply. Houston Chronicle. “Two miles beneath northwest Louisiana’s patchwork quilt of forests, cotton fields and pastures, dozens of drill bits are grinding their way toward what may be the nation’s energy future. The region around Shreveport has known oil and gas exploration for decades, but it’s now buzzing anew as companies try to capitalize on one simple fact — locked into cement-like shale formations thousands of feet underground are potentially huge quantities of natural gas. The gas found in the area’s Haynesville shale and in other shale formations throughout the country has changed the nation’s energy outlook in just a few short years. … But the marriage of two long-used drilling techniques — hydraulic fracturing and horizontal drilling — is showing potential.”

Companies move toward disclosure in frac-fluid issue. Oil & Gas Journal. “In a simmering US political challenge to the main method for completing gas wells in shale, a secondary issue over proprietary information is starting to dissipate. The larger threat is federal regulation of hydraulic fracturing, refinements of which have combined with horizontal drilling to unlock the enormous potential of shales. The oil and gas industry has used hydraulic fracing for 60 years. Regulation of the practice has occurred effectively at lower levels of government. But activist lawmakers and regulators want to impose federal regulation. The producing industry, wary of new delays and costs, says that level of oversight isn’t necessary.”

Shale gas blasts open world energy market. Times Online. “A stretch of coastline on the Texas-Louisiana border provides a startling glimpse of Europe’s energy future. There, where Lake Sabine empties into the Gulf of Mexico, a giant port was completed last year. Built at a cost of $1.5 billion (£900m), it was meant to be a vital new part of America’s energy infrastructure. Giant tankers from places such as Qatar and Sakhalin island in Russia’s far east were meant to dock there to inject their cargoes of liquefied natural gas (LNG) straight into the national pipeline network. … The reason is shale gas — a new and abundant source of natural gas, trapped in rock formations. Oil companies have known about it for decades but always dismissed it because it was too expensive and difficult to extract. In the past few years new technologies that pump water underground to fracture the rock and free the gas have been perfected. The breakthrough has opened a new frontier for the energy industry and turned long-held assumptions about the world’s dwindling supplies on their head.”

The new gold rush. Crain’s Business Journal. “Jeff Decker used to scratch out a living as a truck driver, inching his rig down the Cross Bronx Expressway and rolling across lonely interstates. He built a small trucking business, then sold it, but the proceeds were eaten up by basic expenses and the stock market. The 47-year-old makes ends meet by doing odd jobs and farming on the 120 rural acres outside Binghamton, N.Y., he inherited from his father, who began cobbling together parcels back in 1958. Never did Mr. Decker imagine that his property was perched atop a figurative gold mine: a 95,000-square-mile, $1 trillion deposit of natural gas trapped within the rock of the Marcellus Shale formation—enough to supply the nation for 20 years.”

Proposed tax hikes would hurt industry. Houston Chronicle, Op-Ed. “The renowned pundit H.L. Mencken once opined that for every complex problem there’s a solution that is simple, neat and wrong. President Barack Obama has proposed a “solution” for reducing greenhouse gas emissions that aptly illustrates Mencken’s dictum. By removing so-called subsidies for fossil fuels, claims the administration, CO2 and other emissions can be reduced by 12 percent. More specifically, the White House wants to remove all tax breaks for oil and gas exploration companies, arguing that their elimination will stimulate greater energy efficiency while providing funding for “green” energy alternatives.”

Shale game. Philadelphia Inquirer, Editorial. “A boom in natural gas drilling in Pennsylvania will ease energy demands and boost the state economy. But there’s reason to be concerned that environmental regulators won’t be able to keep up with this new gold rush. Natural gas deposits trapped miles underground in bedrock called the Marcellus Shale in the northeastern United States could hold enough to supply the entire country for 15 years. A relatively new drilling technique enables natural gas operators to extract the gas from the shale beds. Known as hydraulic fracturing or “fracking,” the process pumps up to four million gallons of water mixed with sand and chemicals into the ground at high pressure to break apart the rock and release the gas.”

Marcellus Shale landowners pool information on gas. Philadelphia Inquirer. “For decades, developers of natural gas bought mineral rights in northern Pennsylvania for a few bucks an acre, and that was the end of the story – no drilling ever took place. So Ronald B. Stamets balked when a land man showed up two years ago and offered him $500 an acre for a gas lease. “Whoa, this guy must know something I don’t know,” Stamets, 63, a Web developer who lives near Lake Como in Wayne County, in the state’s northeast corner, recalled thinking. “They were offering real money.”

Energy In Depth: Today’s News

Banker: Marcellus Shale to boost region. Wilkes Barre Times-Leader. “The Marcellus Shale gas play will be “a game changer” for Northeastern Pennsylvania, bringing a “huge economic injection” and making life here very different a decade from now, an economist said Wednesday. James E. Thorne, Ph.D., chief investment officer of equities for M&T Bank, told members of the Greater Wilkes-Barre Chamber of Business and Industry during a luncheon talk at the Westmoreland Club that the region will get “a huge shot in the arm” from natural gas drilling. “The economic forecast is very bright.” Gas drilling has boomed in the Northern Tier of Pennsylvania since horizontal drilling technologies using pressurized liquids have made it financially feasible for companies to drill into the Marcellus Shale, a layer of gas-laden rock that runs about a mile underground from New York into Virginia.”

Report: ND is now 4th biggest oil-producing state. Associated Press. “North Dakota has surpassed Louisiana as the fourth-largest oil-producing state in the nation, the U.S. Energy Department says. The agency’s Energy Information Administration said North Dakota produced 6.38 million barrels of crude in May, edging Louisiana, which had 6.34 million barrels for the month. Oklahoma was ranked fifth, at 5.7 million barrels for that month, according to the most recent figures. Oil production data typically lags at least two months. … North Dakota’s oil production, pegged at 2.8 million barrels for May 2005, has risen sharply since then with improved horizontal drilling technology in the rich Bakken shale and Three Forks-Sanish formations in the western part of the state. “In the Bakken and the Three Forks, they’re having great success poking new holes,” Grape said. “If you look at the increase, it doesn’t look like it’s letting up.”

Louisiana gas pipeline to expand. United Press International. “Texas-based Enterprise Products Partners and Duncan Energy Partners announced plans to expand the Louisiana intrastate natural gas pipeline system. The natural gas pipeline system, governed by the joint venture Acadian Gas LLC, will extend into northwest Louisiana to bring gas from Haynesville shale deposits to regional customers. The Haynesville extension has a design capacity to deliver 1.4 billion cubic feet per day through a 249-mile pipeline connecting existing infrastructure to the affiliated Cypress gas pipeline.”

Vestal landowners offer lease plan for gas drillers. Press & Sun-Bulletin. “A coalition of Vestal landowners has a deal for you: Roughly $46 million and 20 percent royalties for mineral rights to about 8,000 acres. A group of about 400 property owners signed a lease that would make it attractive for energy companies to do business with them, said Marty Leab, a coalition organizer. They have commissioned Dean Lowry and Llama Horizontal Drilling to find a taker in 90 days or less. Specifically, the lease would pay landowners a minimum of $5,750 an acre, plus 20 percent royalties, for a five-year lease of mineral rights, and a three-year extension, according to a copy of the lease obtained by the Press & Sun-Bulletin.”

Drilling processor targets Owego site. Press & Sun-Bulletin. “A plant to treat waste from the Marcellus Shale is on the drawing board in the Town of Owego. Patriot Water Treatment pitched its plans to convert a former car dealership at 936 Taylor Road to a waste water treatment plant for Marcellus drillers at a planning board meeting Tuesday night. The proposal calls for installing holding and processing tanks in the existing building to treat round-the-clock shipments of drilling waste water, according to information from the planning board. Andrew Blocksom, of Patriot, proposed the plan to desalinate brine that is a product of natural gas drilling in the Marcellus, a massive formation running under the region and throughout the Appalachian Basin. He did not return calls Wednesday.”

Stakeholders to speak at NY gas drilling hearing. Associated Press. “Strict new gas-drilling regulations are still not sufficient to protect New York City’s water supply from the risk of contamination, according to politicians and environmental advocates seeking a ban on drilling in the city’s upstate watershed. Drilling opponents, energy companies, gas leaseholders and others with an interest in natural gas drilling in southern New York will get to state their positions Wednesday evening in the first of four public hearings on new regulations proposed by the state Department of Environmental Conservation. The agency released the proposed regulations on Sept. 30 and set a 60-day public comment period. The new rules were drafted as a supplement to existing state regulations on oil and gas exploration, in response to concerns about gas extraction from deep shale formations using horizontal drilling and hydraulic fracturing. In that process, millions of gallons of water combined with chemicals are injected after a well is drilled, fracturing the shale to release the gas. Hydraulic fracturing, or “fracking,” is widely used in the Marcellus Shale formation, a layer of rock about 6,000 feet below ground that extends from southern New York, across Pennsylvania, into eastern Ohio and parts of West Virginia.”

Energy In Depth: Today’s News

Hundreds line up for gas-drilling jobs in Pa. Elmira Star-Gazette. “Workers looking to cash in on the Marcellus Shale are lining up. More than 200 of them, resumes in hand Monday, waited in the parking lot of the Riverstone Inn in Bradford County, where Chesapeake Energy recruited workers as it intensifies natural gas production in northern Susquehanna County. Inside, hundreds more circulated, shoulder to shoulder, waiting to shake hands and pitch their credentials to representatives from Chesapeake and various contractors. Engineers, plumbers, machinists, laborers, truck drivers and a legion of other job seekers, 99.9 percent of them men, came from throughout the Twin Tiers, including Broome and Tioga Counties. … “This is kind of in my field,” said Eric Williamson, 46, an unemployed industrial plumber from Kunkletown, Pa., who was decked out in a tailored suit and tie. … The jobs are mostly blue collar, he said, but also include some professional and administrative positions with opportunity for advancement across the board. … Since 2007, it rapidly has gained popularity among energy producers as they honed technology to effectively harness it. That includes horizontal drilling and a controversial process called hydraulic fracturing, which uses a pressurized chemical solution to fracture bedrock to stimulate gas flow.”

More than 600 attend Chesapeake Energy’s job fair in Wysox Township. Towanda Daily Review. “So many people attended Chesapeake Energy Corp.’s job fair Monday at the RiverStone Inn in Wysox Township that the line of people waiting to enter the fair extended out the door of the inn, through its parking lot, and halfway into the parking lot of the Dandy Mini Mart next door. “Well over 600 people” attended the job fair, which was held from 1-5 p.m., said Brian Grove, director of corporate development for Chesapeake. ”We were really excited about it (the turnout),” Grove said.”

Energy execs question regulations. Buffalo News. “The push and pull between the energy industry and environmental concerns took center stage Monday during a gathering of area energy industry executives arranged by Rep. Chris Lee, R-Clarence. The trick, Lee said, is finding the happy medium that balances the environmental concerns with the push to make the United States less dependent on foreign oil, while developing domestic energy sources, like the Marcellus Shale, as well as solar and wind energy. “We have ample resources in this country. The Marcellus Shale is a wonderful example,” Lee said. … The state Department of Environmental Conservation last month proposed new regulations on the use of a process, called hydrofracking, that injects 3 million to 5 million gallons of water and chemicals into a well to crack the rock formations and free the natural gas trapped within it. … Marchiore sees the Marcellus Shale as a great economic opportunity for the Buffalo Niagara region, even if the wells themselves will be in the Southern Tier and northwestern Pennsylvania. Local companies could support the drilling activity, including companies like National Fuel Gas Co., which has extensive drilling plans for the region and plans to expand its pipeline network there, as well. “This is an economic growth engine and proven technology,” Marchiore said. “We’ve got to get out of our own way.”

Fill ‘er up: At-home CNG refueling station a first. Arkansas News. “Danny Games fills up his SUV every night without ever having to leave home. Earlier this year, the Chesapeake Energy executive had his 2009 Tahoe retrofitted to burn compressed natural gas, and had a Phill-brand natural gas home refueling unit installed in his carport. Games said as far as natural gas utility CenterPoint Energy knows, his home refueling station is the only one of its kind in the state. When Games gets home at night, he runs a thin yellow cord from the unit and attaches it to his vehicle. While the exercise looks about the same as a car filling up at a gasoline pump, there’s a big difference in the cost, he said. “It has been about 50 percent less than the cost of unleaded,” Games said. … Production has been buoyed in recent years by exploration in the Fayetteville Shale play in north-central Arkansas, one of the nation’s 10-largest natural gas fields. Chesapeake Energy is among the largest players in the Fayetteville Shale play.”

Fortuna Energy’s parent company to open office in Pittsburgh. Elmira Star-Gazette. “Talisman Energy, the Canadian parent company of Fortuna Energy in Big Flats, plans to open an office in Pittsburgh that will focus on the company’s growing Marcellus Shale drilling operations in Pennsylvania. … “Talisman Energy is going to establish a U.S. office in Pittsburgh and that’s the extent of what’s been determined,” Scheuerman said Monday afternoon. … “Marcellus Shale is a multi-state operation and there are opportunities in New York and Pennsylvania,” he said. “We have had great success early on and this was seen as the right way to go in order to coordinate all of the North American operations that are focused on Marcellus Shale.”

Councilman: Shreveport likely to approve oil and gas regs today. Shreveport Times. “Shreveport likely will approve its oil and gas regulations today, City Councilman Michael Long said Monday, but with a few concessions to the industry. “Basically, we’re going to mirror the state field order, the way the parish has done,” Long said. “Then we’re going to pick our battles later.” Local proposals, like state laws, are aimed at protecting community and private resources while encouraging production, particularly extraction of natural gas from the Haynesville Shale formation. If passed, Shreveport’s regulations would guard drinking water contamination and control lighting and hours of operation at drill sites.”

Longer drilling permits a possibility. Grand Junction Daily Sentinel. “State oil and gas regulators will formally consider an industry request that oil and gas drilling permits be made valid for two years instead of one. However, Colorado Oil and Gas Conservation Commission staff have recommended against reconsidering a new rule that is forcing energy developers to remove many liners when they close drilling-related pits, even though some landfills don’t accept the liners. The commission is expected to consider the permit proposal in the next month or two. “On reflection we believe this is a reasonable adjustment to make,” commission director David Neslin told the commission at a meeting Monday.”

Pipeline dream in peril. National Post. “Ottawa has decided not to proceed with its investment in the $16.2-billion Mackenzie Valley Pipeline, sources said, throwing the future of Canada’s largest construction proposal into doubt. Sources said that Jim Prentice, the Environment Minister, took a major financial assistance package proposal to a Cabinet committee last week and it was turned down over concerns about the project’s price tag. … Ottawa has decided not to proceed with its investment in the $16.2-billion Mackenzie Valley Pipeline, sources said, throwing the future of Canada’s largest construction proposal into doubt. Sources said that Jim Prentice, the Environment Minister, took a major financial assistance package proposal to a Cabinet committee last week and it was turned down over concerns about the project’s price tag.”

Energy In Depth: Today’s News

Energy Insider: Focusing on Frac Jobs. KFYR-TV. “Workers for Pumpco Services are on a mission: to make getting oil from the Bakken shale as easy as possible. “What we’re doing is creating fractures in 18 different spots in that rock,” said Roger Nash, Pumpco`s Technical Manager. “And together those 18 fractures will allow the oil to flow through.” It all starts with a blast down the well bore to puncture the rock. “What they’ll in essence do is like shooting a gun into a piece of wood,” Nash said. That’s when a company like Pumpco brings in specialized pumping trucks. The system is forcing nearly a million gallons of water into the ground at high pressures – between 4000 and 6000 pounds just at the surface.”

Protecting Water While Drilling for Natural Gas. New York Times, NY State Petroleum Council’s Mike Doyle. “We can safely develop New York’s extensive clean-burning natural gas supplies while also providing jobs, growth and substantial revenues to the state. Studies of hydraulic fracturing, a 60-year-old technology crucial to natural gas development and already widely used in New York, strongly suggest that the technology is safe despite recent concerns. The state’s Department of Environmental Conservation says that “no known instances of groundwater contamination have occurred from … hydraulic fracturing projects in New York State.” In fact, no investigation by any state or federal agency has demonstrated that hydraulic fracturing has caused groundwater contamination, despite its use in about one million wells drilled in the United States.”

La. is drilling hot spot. The Daily Advertiser/Shreveport Times. “Ten percent of all of the current oil and gas exploration in the United States is centered in a corner of northwestern Louisiana, home to what’s known as the Haynesville Shale. Even more surprising, says Scott Angelle, secretary of the Louisiana Department of Natural Resources, is “5 percent of the nation’s drilling activity is in one parish — DeSoto,” a sparsely populated 894-square-mile section just south of Shreveport along the Texas border. Crews currently have 108 wells drilling in what’s known as the North Louisiana Province, Angelle said, and 53 are in DeSoto Parish. … The Haynesville Shale is a rich depository of natural gas trapped between vertical columns of rock. To get the gas out of the ground, crews drill about two miles down and then move horizontally, blasting the shale with high-pressure water to break down or fracture the chambers, releasing the gas to be transported to the surface through the well. The process is known as “fraccing.”

Gas documentary offers anecdotes, not evidence. Grand Junction Sentinel, Editorial. “Many of the people featured in the documentary, “Split Estates,” have heart-breaking stories about health problems they have suffered. What they don’t have, and what is absent from the documentary itself, is actual evidence that connects those health problems to the hydraulic fracturing of natural gas wells. Without this causal link between the fracturing substances and disease, the claim of wrongdoing — like the documentary itself — falls flat, at least with respect to hydraulic fracturing. … When it comes to fracking fluids, however, some of the stories recounted in “Split Estates” may provide fodder for those on the other side. For instance, it is difficult to accept that fracking is responsible for someone’s health problems if another person living in the same house, breathing the same air, drinking the same water suffers none of those ailments. … The Environmental Protection Agency has twice concluded that fracking is not dangerous — once during the Clinton administration and most recently in 2004. … By substantially overstating the case against fracking while providing little evidence to support its claims, “Split Estate” may actually harm the cause it seeks to champion.”

Boom towns: Gas drilling quickly changes small-town life in Central Pa. Scranton Times Tribune. “An owner of Beck Oilfield Supply traveled from Oklahoma to Pennsylvania this year to find the best place in the midst of the Marcellus Shale natural gas drilling rush to plant one of his stores.He picked Wysox, a small town that borders Towanda, the Bradford County seat, and he wasn’t alone. Two other stores that specialize in drilling and gas production supplies have opened within two miles of Beck Supply along Route 6 in the past year. … “Things have changed,” Bradford County Commissioner Doug McLinko said. “There’s storefronts filling back up again, there’s vacant lots filling back up again. The independent, family-owned businesses are being saved. “The impact it’s having for real people is pretty incredible.” … An industry-financed study released by Penn State University in July projects that Marcellus Shale drilling will create a total economic output of $3.8 billion in the state this year and $13.5 billion in 2020.”

Plenty of oil out there. The Oklahoman, Op-Ed. “For more than 100 years, people have been claiming the world is running out of oil. But there is no factual support for the claim that the world’s petroleum resources are nearing exhaustion. The world has enough oil left to supply demand through the end of this century. … The Williston Basin in Montana and North Dakota contains nearly 4 billion barrels of oil that has yet to be discovered and produced. Oil has been produced from the Williston Basin since the 1920s. But the introduction of horizontal drilling and hydrofracturing have made it possible to exploit resources heretofore unreachable. Among the leaders in using the new technologies is Oklahoma’s own Continental Resources. … We have the technology to produce petroleum from oil shale in a manner that is efficient, economic and environmentally friendly. What’s stopping us is ignorance and bad public policy.”

INGAA study takes midstream look at long-term gas supply. Oil & Gas Journal. “Projected growth in North American natural gas supplies and markets will require billions of dollars of additional investments in pipelines, storage, and other midstream infrastructure through 2030, a recent INGAA Foundation Inc. study concluded. The study, which the Interstate Natural Gas Association of America’s research division released on Oct. 20, projected that investments of $133-210 billion—or $6-10 billion/year—would be needed in the next 20 years under various market scenarios. … Other experts agree that hydraulic fracturing and other technologies are opening up significant gas resources that would have been ignored 20 years ago. “We have an unconventional gas revolution in the US. I expect it to be the default fuel in electric power,” Daniel Yergin, chairman of IHS Cambridge Energy Research Associates, said during an Oct. 21 forum cosponsored by the US Chamber of Commerce and Foreign Policy magazine.”

Q&A: Energy vet works to turn around downturn. Houston Chronicle. “Victor Burk is a familiar face to many in Houston’s energy business. He spent 30 years with Arthur Andersen, including many years as head of the now-defunct accounting firm’s energy practice. He later headed Deloitte’s energy business before moving over to executive recruiting firm Spencer Stuart. Earlier this year he took his experience (and considerable Rolodex) to turnaround management and advisory firm Alvarez & Marsal … They know the gas is there and it becomes more like a manufacturing process, acquiring acreage, making the decisions on how many drilling locations, which to drill in which order, getting the rigs lined up, the fracing (hydraulic fracturing) and other completion activities. It involves hundreds of drilling rigs, hundreds of frac crews, getting the wells drilled in the least number of days. It’s very different from anything we’ve seen in this industry in the past. We’ve worked with a few E&P companies in applying some of the techniques and tools used by large manufacturing companies.”

Pa. Tapped, Drillers Not. Philadelphia Inquirer. “The drillers must shatter the Marcellus to release the gas locked in the rock. They hydraulically fracture the shale with high-pressure injections of water, chemicals, and sand. The “fracking” process requires huge amounts of water, which returns to the surface with elevated salt and mineral content that requires treatment. … But the gas companies say they increasingly are recycling the frack fluids, and treatment plants are being upgraded. “Handling the water is not a problem, so let’s get on with it,” said Murry S. Gerber, chief executive of EQT Corp., a Pittsburgh producer. … Lodgings are in short supply in Williamsport, where motel parking lots are filled at night with pickup trucks bearing Texas, Louisiana, and Colorado tags. Demand for apartments and office space is also picking up. …Contractors are busy supplying gravel for well sites, or transporting pipe or water to rigs, said Jason C. Fink, executive vice president of the Williamsport-Lycoming Chamber of Commerce. “It’s nice to see some of our existing businesses are getting a bump,” said Fink. He said local banks had reported a substantial increase in deposits from accounts in gas-producing areas.”

Westmoreland Marcellus gas field mapping planned. Pittsburgh Tribune-Review. “A three-dimensional map of the Marcellus Shale underneath eastern Westmoreland County, including Keystone State Park, will be produced in the coming months to help two drilling companies locate the best spots for gas wells. A public meeting was held at the park Friday night to help explain the mapping process of the Marcellus Formation, which contains a natural gas reserve energy companies are eager to tap. The map is being produced by Oklahoma-based McDonald Land Services and Dawson Geophysical Company of Texas on behalf of Rex Energy and the Williams Production Appalachia, two energy exploration firms.”

Marcellus Shale drilling pumps water business. Pittsburgh Business Times. “The most familiar refrain from Marcellus Shale drillers is that water remains the biggest obstacle to developing the natural gas trapped inside the rock. Once the chemically treated water, used to help break up rocks and extract the gas, is pumped back out of the ground, what’s to be done with it? Several water treatment facilities are banking on the challenge, hoping to entice the industry’s operators to bring them used “frac” water when they open in the next several months.”

Energy In Depth: Today’s News

House caucus hopes to call attention to natural gas resources. Pittsburgh Post-Gazette. “’We are swimming in natural gas,’ declared billionaire oil man T. Boone Pickens at a House of Representatives hearing yesterday. And Pennsylvania is the deep end of the pool. The Marcellus shale deposits constitute enormous potential for domestic fuel production, and Rep. Tim Murphy, R-Upper St. Clair, formed a natural gas caucus in the House to call bipartisan attention to the issue. At the caucus’ first hearing yesterday — borrowing a room from the Science and Technology Committee — the keynote witness was Mr. Pickens, whose high-profile “Pickens Plan” advocates energy efficiency and domestic resource production as near-term goals. … Ray Walker, vice president for Marcellus shale driller Range Resources, said federal regulation of hydraulic fracturing, a method of extracting natural gas, would be a mistake, because it is already regulated at the state level and, he claimed, is environmentally sound when done correctly. He also argued against a proposed change in tax accounting methods for the industry.”

Rattie: Natural gas under attack. Shreveport Times. “Keith O. Rattie, the president and CEO of Questar Corporation, said that final scene is analagous to the current plight of the natural gas industry. Rattie was the keynote luncheon speaker at the Gulf Coast Prospect and Shale Expo Wednesday at the Shreveport Convention Center. The expo continues today; this was the first year the expo was held in Shreveport. It is usually in Lafayette. Industry professionals have the opportunity to buy and sell trade prospects from one another. The natural gas industry is threatened by bullets in the form of increased taxation, federal regulation of hydraulic fracturing, the myth of green jobs, and the American Clean Energy and Security Act of 2009, which Rattie called “the most asinine piece of legislation in U.S. history.”

Shale gas supply debate heats up. Financial Times. “Just as the rest of the world begins to get excited about prospects for shale gas reserves, a skirmish is growing over just how much shale gas is actually recoverable in the US. Matt Simmons has said a few times this year that he doesn’t see evidence that the big shale plays such as Barnett are actually providing big increases in natural gas production, despite the number of wells being sunk. He also pointed to the environmental problems with the hydraulic fracturing used to extract shale gas.”

Garrett landowners hope to capitalize on value of Marcellus Shale. Cumberland Times-News. “Marcellus Shale in Garrett County is shaping up to be a goldmine and the Penn State College of Agricultural Sciences Cooperative Extension wants to ensure that exploration of the formation will benefit both energy companies and landowners. The extension group held a meeting on Tuesday evening at the Finzel Fire Hall to educate local landowners about the shale, its development by energy companies and leasing opportunities that may be available to them. Roughly four dozen people attended. Marcellus Shale is an expansive rock formation containing natural gas ranging from New York to Virginia.”

Webster plant will make gas production supplies. Associated Press. “Construction has begun in Webster Parish for a company that will make products for oil and gas operators in the Haynesville Shale fields in northwestern Louisiana and other natural gas fields in the United States. The company is called Patriot Proppants. It will produce a resin-coated sand used in hydraulic fracturing – the use of pressurized fluid to fracture underground rock and release gas. Patriot Proppants is building on 27 acres in the 260-acre South Webster Industrial District park. The company held groundbreaking ceremonies Tuesday. It hopes to open by late next summer and plans to have 30 skilled employees with a payroll of approximately $1.3 million annually, according to The Times newspaper.”

Energy In Depth: Today’s News

City Council Backs Drilling at Two Parks. State Journal. “To drill or not to drill. That was the question presented before Wheeling City Council Tuesday night. And in a vote of 6-1 council gave the “green light” to natural gas drilling at the city’s two parks. Chesapeake Energy geologists believe there is natural gas in the marcellus shale some 7,000 feet below the ground. The company hasn’t said for sure they will drill.”

Drilling plan includes recycling. Wilkes Barre Times-Leader. “As if responding to previous community criticism about a similar facility, company officials hoping to build a drilling-waste treatment plant near Meshoppen said Tuesday recycling water is part of their plans. “It makes sense to reuse this water,” said Ron Schlicher, an engineer consulting for the treatment company. “The goal here is to strive for 100-percent reuse, so we don’t have to discharge.”

Council Backs Drilling. Wheeling Intelligencer. “Chesapeake Appalachia can now drill for natural gas on select sites at Oglebay and Wheeling parks, thanks to City Council’s 6-1 vote Tuesday to approve a lease agreement with the company. Councilman Robert “Herk” Henry said during and after the council meeting that he received phone calls from those concerned about the environmental impact of the drilling, prompting him to oppose the measure. Mayor Andy McKenzie, Vice Mayor Eugene Fahey, Councilwoman Gloria Delbrugge and councilmen Vernon Seals, James Tiu and Don Atkinson favored allowing the drilling. Members tabled a vote on the action during an Oct. 6 meeting after several residents expressed reservations.”

No Uptick Seen for Natural Gas Prices, ENI Says. Wall Street Journal. “Crude oil prices may be showing signs of a recovery, but natural gas prices will stay depressed for years to come, the head of Italian energy company ENI SpA said in an interview on Tuesday—and the grim price outlook could force energy companies to rethink some investments in new gas projects. … Advances in drilling technology have allowed producers to tap huge volumes of gas locked in dense rock called shale. That has led to a big uptick in production and an upgrading of domestic reserves. … Meanwhile, it is likely that the same technology that has been used to open up shale gas in the U.S. could now be used to develop unconventional gas resources in Europe, meaning more supply.”

Patriot Proppants to build new facility in Webster Parish. Shreveport Times. “A new startup company broke ground Tuesday and should begin moving dirt this week for construction of a two-line resin coated proppant facility that will market its product to oil and gas operators in the Haynesville Shale and other natural gas plays across the United States. … The company will specialize in producing resin-coated sand, which reduces flowback during natural gas hydraulic fracturing process. Increased activity in the deeper, high pressure formations such as the Haynesville Shale has driven demand for specialized proppants. Proppants can include naturally occurring, manmade or specially engineered materials that are mixed with fracturing fluid to hold open the facture and aid in the efficient movement of the fluid from the formation to the wellbore.”

Clarion University helps businesses capitalize on the Marcellus Shale. Clarion University. “The Marcellus Shale, the hottest natural gas boom in the United States, is offering unexpected business opportunities to Pennsylvania. Clarion University’s Small Business Development Center (SBDC) has stepped forward to help local business benefit from this boom. Through a five-part seminar, Clarion SBDC is working with local economic development agencies to inform business owners on how they can take advantage of the economic benefits of the Marcellus Shale. The series provides information on the benefits and employment opportunities projected to boost the local economy within the next decade.”

Energy In Depth: Today’s News

Gas-drilling article missed the mark. Philadelphia Daily News, DEP Sec. John Hanger. “The public needs accurate information to understand how natural-gas drilling operations may affect Pennsylvania’s water quality, but ProPublica’s Oct. 16 article in the Daily News uses outdated and erroneous data, and out-of-context quotations from 6-month-old interviews to paint a very misleading picture. DEP has taken steps to protect the state’s waterways by doubling the number of oil and gas inspectors, inspecting all Marcellus Shale drilling sites, issuing violation notices when needed and shutting down operations when the law is repeatedly broken. There are also 13 monitors measuring total dissolved solids along the Monongahela River, another point ProPublica ignored.”

NYS: drill, baby, drill! New York Post, Op-Ed. “The Paterson administration has finally given a green light to proposed drilling in the Marcellus Shale, considered by many to be the nation’s largest natural-gas reservoir. Covering several states and extending more than 600 miles, the basin may contain as much as six decades’ worth of US natural-gas needs. Drilling is already under way in Pennsylvania and other Marcellus states. Well over a year ago, Gov. Paterson put energy production on hold here at home so regulators could study the issue. This delay satisfied the demands of anti-drilling greens, but it denied the Empire State’s economy a much-needed boost. … Paterson’s report shoots down alarmist green claims that drilling in the watershed puts the city’s water supply at risk. Instead it insists on sensible environmental regulations specifically tailored to hydraulic fracturing drilling — such as extensive testing of water wells near drilling sites, disclosure of which chemicals are used to extract gas buried deep underground and strict plans for wastewater disposal.”

DEC shale drilling rules up for comment. Catskill Daily Mail. “The rules for Marcellus shale drilling for natural gas in NYS are working their way towards adoption. In a hefty Draft Supplemental Generic Environmental Impact Statement (DSGEIS) released at the beginning of the month, NYS Department of Environmental Conservation (DEC) has announced its proposed regulations for horizontal drilling using the hydraulic fracturing method, with comments accepted on them through Nov. 30. There will be only four public hearings on the proposed regulations, the closest being in Loch Sheldrake, Sullivan County, on Wednesday, Oct. 28, beginning at 6 p.m. for speaker sign-up, with public comment beginning at 7 p.m.”

Texas firm plans Marcellus well for Highland Township. Clarion News. “Plans are afoot for another Marcellus gas well in Clarion County. If approved it would be the third such well in Northern Clarion County and the seventh to be considered for approval in the entire county. Citrus Energy Corp. of Plano, Texas and Castle Rock, Colo. has applied to the Meadville DEP Oil and Gas office for an erosion and sedimentation permit for a site along Sarvey Mill Road in the northwest corner of the Highland Township, very close to Knox and Farmington townships. According to a description by DEP spokesperson Freda Tarbell, the well site is along a ridge between Little Toby Creek and Eagle (Engle) Run.”

Range Resources recycles all waste water from Washington drilling. Tribune-Review. “Range Resources Corp. announced today that it is now recycling all of the waste water produced by its natural gas drilling operations in Washington County. The recycling efforts will play a huge role in achieving the state Department of Environmental Protection’s proposed 2011 water quality discharge standards, according to Range. “Range’s recycling program is helping to eliminate wastewater, lower drilling costs, reduce consumptive water needs by 25 percent, and lessen local truck traffic,” said Jeff Ventura, Range’s president and chief operating officer, in a statement.”

Gas driller says it is recycling wastewater in Pennsylvania. Associated Press. “One of the most active exploration companies on the Marcellus Shale natural gas formation said it is using a water-recycling system it devised. Oil and gas company Range Resources Corp. said Monday it is reusing all the water it recovers from newly drilled wells in its core exploration area in southwestern Pennsylvania. That adds up to millions of gallons of water being reused in Washington County. The Fort Worth, Texas-based company said the recycling is cutting drilling costs, water use and trucking traffic while eliminating the dumping of wastewater into waterways.”

Gas Drilling at Oglebay Goes Up for Vote. Wheeling News Register. “A visit by Wheeling City Council to proposed natural gas drilling sites at Oglebay and Wheeling parks helped Councilwoman Gloria Delbrugge decide to support the plan. Resident Bruce Edinger, however, remains concerned the proposed Marcellus Shale drilling may cause irreparable ecological harm to the parks. Council is expected to vote on a resolution authorizing Chesapeake Appalachia to drill on city-owned property in the park areas at 7 p.m. today in City Council Chambers on the second floor of the City-County Building, 1500 Chapline St. Members tabled a vote on the measure during an Oct. 6 meeting after several residents expressed concerns on the matter.”

Energy In Depth: Today’s News

Energy Insider: Hydraulic Fracturing. KFYR-TV. “A drill rig just south of McGregor will be tapping into oil that’s been known about for decades. “Everybody knows where it’s at. We’ve known it for a long time,” said Russell Atkins, Area Supervisor for Continental Resources. But economically, it is just starting to make sense to go after the oil in the Bakken Formation. That’s because recent developments in horizontal drilling technologies make it easier to drain a larger area underground. “Instead of just having one well bore that intersects eight to nine feet of rock, you’re intersecting thousands of feet of rock,” said Atkins.”

Solutions should bolster development. The Oklahoman, IPAA’s Barry Russell. “Now more than ever, though, with unemployment at a 26-year high, such punitive taxes will only discourage domestic energy production, leading to less stable — and possibly higher — energy costs and a deeper, more dangerous dependence on foreign energy sources. While the administration should be applauded for its commitment to diversifying our nation’s energy supplies, these proposed tax increases would cripple independent energy producers who are responsible for much of the economic activity throughout Oklahoma and many other states. In no uncertain terms, making it more difficult to produce, refine and deliver oil and gas to the American people will increase our dependence on foreign oil and lead to less stable prices at the pump.”

Pa. allows Cabot to resume hydraulic gas drilling. Associated Press. “State environmental regulators say Cabot Oil and Gas Corp. can resume a drilling technique in Pennsylvania that uses liquids to fracture rock and release natural gas. … The DEP’s Northcentral Regional Director Robert Yowell says Cabot submitted acceptable prevention plans and an engineering study. Regulators acted after Cabot reported three spills of a liquid-gel lubricant within seven days at one of its gas-drilling sites. All of Cabot’s so-called hydraulic fracturing, or “fracking,” operations are in northeastern Susquehanna County.”

Shale speculation off base. The Oklahoman, Devon’s David Hager. “At a time when we are seeking solutions to our long-term energy questions, it is too bad that progress can be clouded by misinformation. ‘Gas shale’s future is uncertain’ (Associated Press business story, Oct. 13) cast inexplicable doubt on a new resource that has changed the landscape of our energy future. Geological consultant Arthur Berman has been making a name for himself recently by writing columns and giving speeches that question the long-term viability of shale as a source of natural gas. There is nothing new about shale. It is a type of rock that energy companies have been drilling into and around for decades. We knew how natural gas and oil can emanate from shale, but until recently we did not know how to produce energy from the dense, tight formations themselves.”

Sullivan County would do well to look at Pennsylvania experience with fracking. Times Herald-Record. “When the natural gas rush hits the Catskills — and it will — your life and land will profoundly change. This is the inevitable conclusion to be drawn from the drilling boom in neighboring Susquehanna County, Pa., an area that sits on the same gas-rich Marcellus shale formation as Sullivan. If communities like Dimock and Montrose, Pa., are any indication, gas drilling will alter everything from Sullivan’s country roads and pristine vistas to its struggling work force and pure water. In gas hot spots like Dimock — population, 1,398 — it seems you can’t drive more than a few hundred yards without seeing fields dotted with the tall towers of drilling rigs and the blue or green steel “fracking” fluid tanks used for horizontal drilling. … Unemployment — which hovers around 8 percent in both Sullivan and Susquehanna counties — should drop because of “the dramatic increases in development over the next five years,” according to a Workforce Needs Assessment Study, by the Marcellus Shale Education and Training Center. … By the end of this year, gas drilling will create between 1,300 and 2,100 jobs in Pennsylvania’s northern tier. Estimated wages for those jobs were unavailable.”

Marcellus Shale: Municipalities to oversee treatment of waste from gas drilling. Elmira Star-Gazette. “New York state’s environmental regulations on gas drilling in the Marcellus Shale task local municipalities with important responsibilities on the front end and the back end. Last week, it was reported that local health departments would be responsible for monitoring private wells before, during, and after gas drilling. The overseers of wastewater treatment plants will also bear a large “responsibility and burden” if they choose to accept waste from hydraulic fracturing, according to Jimmie Joe Carl, an engineer with Penfield-based MRB Group.”

Drill Gas Here, Drill Gas Now. Forbes, Op-Ed. “The last few months have seen a surge in interest in natural gas, the cleanest fossil fuel. American engineers and geologists have pioneered new, more effective ways of extracting natural gas from shale formations, and recoverable reserves in the United States have gone up by an extraordinary 40% in just the last four years. What’s even more appealing is that many of the biggest natural gas discoveries have been in states that have been hard hit by industrial decline. The Marcellus shale, which could be the second-largest natural-gas field in the world after an offshore field in the Persian Gulf, stretches from the shores of Lake Erie through Pennsylvania, Ohio, Kentucky and West Virginia, and locals are hoping for an economic Cinderella story.”

SUNY Fredonia looking to become shale institute. Evening Observer. “Fredonia State University geosciences professor Gary Lash has been working with Marcellus Shale for the past 10 years, before it was the talk of the energy world. For the past year, however, Lash, along with his colleague and Penn State Professor Terry Engelder, have been center of attention in the Marcellus Shale discussion due to their knowledge about its incredible potential as an energy resource. “It was the technology that came out of the Texas-Fort Worth basin low-level drilling and high gas prices last year,” Lash said about the confluence of two events that led to the discovery. “I’ve been working with these shales for 10 years, back when people didn’t care about shales. They were the rock you had to get through to get to the sandstones where the hydrocarbons are located. It’s a different world now.”

Energy Firms Deeply Split on Bill to Battle Climate Change. New York Times. “As the Senate prepares to tackle global warming, the nation’s energy producers, once united, are battling one another over policy decisions worth hundreds of billions of dollars in coming decades. Producers of natural gas are battling their erstwhile allies, the oil companies. Electrical utilities are fighting among themselves over the use of coal versus wind power or other renewable energy. Coal companies are battling natural gas firms over which should be used to produce electricity. And the renewable power industry is elbowing for advantage against all of them.”

Chesapeake updates progress in Barnett, other shale plays. Fort Worth Business Press. “When talking about figures in the thousands of feet, a few hundred more feet might not seem like much, but in drilling that extra push horizontally can mean quite a bit more gas. Progress – that was one theme addressed during Chesapeake Energy Corp.’s annual investor and analyst conference in which the natural gas exploration and production company outlined its activities in shale and other energy plays nationwide.”

Energy In Depth: Today’s News

Horseheads Village Board Gives Schlumberger the Green Light. WENY-TV. “After more than nine months of review and intense opposition from some community members, the Horseheads Village Board gives the Schlumberger Project final approval. … But Horseheads Mayor Don Zeigler says the board stuck to its job, addressed the public’s concerns and moved forward with the project. “I’ve had people try to intimidate us, to sway our vote, we stayed the course and I am ashamed for some of the comments,” said Mayor Don Zeigler. “Shame on those people who tried to sway our votes to do an honest job.” Mayor Zeigler says the board did an honest appraisal of the project and as far as he’s concerned it’s a done deal. … Others say, bring on the jobs. “Some of their early projects have already developed with local labor,” said Erin resident, Dave Blauvelt. “Speaking with some of the representatives, they’re very interested in having local labor involved, which is very exciting.” Project representatives say Schlumberger will fill 75 percent of the 400 positions with local workers. Mayor Zeigler says the company will bring more than just jobs. “What we are looking for now is enjoying the economic boom, houses are going, staff is coming in, they’re hiring people, it’s a first class company,” Zeigler said.”

Gas Drilling Support Center Coming to Horseheads. WBNG-TV. “A gas drilling support center is officially coming to Chemung County. Schlumberger was approved tonight by Horseheads village leaders. … “Little ‘ol sleepy hollow Horseheads is now on the map,” says Village of Horseheads Mayor Donald Zeigler.  After months of study and debate, Schlumberger is coming to Horseheads. “We need new industry in Chemung County and these guys have a really good track record. They’re one of the top 500 greenest companies in America and I couldn’t be happier that this project has been approved,” says Michael Sincock of Pine City. The village board unanimously gave the gas drilling support center the green light Thursday night. It will open an 88 acre site here in Horseheads. And is expected to bring 300 jobs to the area. “What we’re looking forward to now is the economic boom. Houses are going. Some of their staff is coming in. They’re hiring people who have been laid off,” says Mayor Zeigler.”

Schlumberger plans approved. Elmira Star-Gazette. “Horseheads trustees gave final village approval Thursday to site plans for a proposed Schlumberger Technology Corp. gas drilling service facility. The unanimous vote ends months of review and controversy surrounding the project, which is expected to create 400 jobs, but also stirred environmental concerns. Schlumberger plans to locate its facility on about 90 acres it owns in The Center at Horseheads industrial park. The site will provide support services to natural gas drilling companies operating in the area. There will be no drilling on-site, but there will be chemicals, explosives and radioactive materials stored there. … Mayor Don Zeigler said the Schlumberger project is bigger than anything Horseheads has ever dealt with, and that the review of their plans has been exhaustive. “There has been some pressure put on us to do our job,” Zeigler said. “We did our job. We went to the horse’s mouth to check on a lot of stuff. “Some of the misinformation in the public has been an attempt to sway our vote. We came here to do an honest and fair appraisal of what came before us. I know we did it.”

Schlumberger Given Final Approval. WETM-TV. “A natural gas drilling services project in Horseheads that’s expected to create 400 jobs has been given final approval. After months of debate, the board voted to approve the site plan for Schlumberger Thursday night. … “I’m thrilled that they approved the project.  I think we need the industry.  I think the environmental issues here were overblown by a minority of the people,” said neighbor Michael Sincock. The mayor says the site plan approved addresses all of the concerns raised by neighbors. He says this has been a six month long process of review, discussion and public hearings. “This process started last spring and what is it now?  It’s October.  This is not rushing a project.  We spent a lot of time and money for our engineer,” said Mayor Donald Ziegler.”

Schlumberger passes review. Corning Leader. “The Schlumberger project cleared the last major hurdle in its review process Thursday evening when the Horseheads Village Board approved the site plans. An environmental impact review was completed last week. Although a few permits are still needed, construction will likely begin in a few weeks, said Glenn Harvey, project manager for Bergmann Associates, Schlumberger’s design firm. Schlumberger has already been operating from a temporary facility in The Center at Horseheads.”

Natural Gas from Shale: Emerging Plays. Seeking Alpha. “A decade ago natural gas from shale was just becoming significant but hardly anyone fathomed its tremendous potential or its parabolic growth. Today natural gas from shale is an essential and rapidly growing part of the E&P portfolios of independents and majors alike in the US, Canada and Australia. The number of productive basins is proliferating. Both interest and exploratory investments in natural gas from shale are spreading worldwide. There is growing recognition that natural gas shale basins are widely dispersed globally and several of these basins may well rival or exceed the most famous shale play in the world: the Barnett in Texas.”

Fracking poses ‘unprecedented threat’: critics. Times Herald-Record. “The stakes couldn’t be higher for proposed gas drilling rules, speaker after speaker said at the first public hearing for those state regulations. On the line: The water New Yorkers drink, the land they live on and the money they make. The high stakes for those who live on the gas-rich Marcellus shale — including in Sullivan County — are why Callicoon Center’s Bruce Ferguson, of Catskill Citizens for Safe Energy, summed up the concerns of many when he said drilling is “an unprecedented threat to our environment.” … “I fear that the (draft environmental impact statement) goes too far and places New York at a distinct competitive disadvantage with other states,” said Brad Gill, executive director of the Independent Oil and Gas Association of New York. Gill was the only speaker who urged the DEC to speed up. Just about all of the 25 speakers wanted to make drilling tougher, or stop it. Water was the top worry, specifically that the horizontal drilling process of “fracking” would pollute the drinking water of the Sullivan-based New York City watershed.”

Municipalities to oversee gas waste treatment. Ithaca Journal. “New York state’s environmental regulations on gas drilling in the Marcellus Shale task local municipalities with important responsibilities on the front end and the back end. Earlier this week, it was reported that local health departments would be responsible for monitoring private wells before, during, and after gas drilling. The overseers of wastewater treatment plants will also bear a large “responsibility and burden” if they choose to accept waste from hydraulic fracturing, according to Jimmie Joe Carl, an engineer with Penfield-based MRB Group. Carl is conducting an analysis of the Ithaca Area Wastewater Treatment Plant on behalf of its municipal owners, the City of Ithaca and the Towns of Ithaca and Dryden. … Carl also emphasized the “variability of this fracking water, even from one well, much less from different wells.” “Over time, certain parameters become more elevated at the end of the fracking process. So that speaks to the frequency and the timing of sampling this. One sampling at the beginning may not be representative to characterize this,” he said.”

Energy In Depth: Today’s News

Efficient drilling will mean both gas and jobs. Lebanon (Pa.) Daily News, Energy In Depth’s Jeff  Eshelman. “Dave Wolf uses his column of Oct. 3 to put forth the by-now-familiar argument that to explore for job-creating deposits of natural gas in Pennsylvania is to turn our back on the state’s rich outdoors heritage, and to put “at risk” the imperative of keeping our drinking water clean, safe and pollutant-free. Such an assertion not only ignores the history of Pennsylvania as both a leading producer of energy and home to some of the best hunting, fishing and hiking in America, but it also ignores the advances in technology that allow us today to produce these energy resources with far fewer wells drilled – and far less land disturbed in the process. … Your Outdoors reporter can rest at ease – and his readers can expect the jobs, revenue and opportunity that accrue to states that produce their own energy.”

The fallacy of peak oil. Grand Junction Free Press, Op-Ed. “In a similar vein, the proponents of peak oil tend to overlook some key factors: advances in drilling, exploration, production, and conveyance of oil and natural gas have served to make available sources which as little as a decade ago were considered unrecoverable, and hence not included on peak prediction spreadsheets. Horizontal and directional drilling capabilities, breakthroughs in well logging and evaluation technologies, and advances in production techniques serve as a few examples of innovations which have increased accessibility to, and improved recovery of, hitherto unobtainable resources.”

BC and Alberta in a natural gas poker game. Alberta Herald. “British Columbia fired the latest round Thursday in the North American battle to woo natural gas producers, unveiling miniscule royalty rates and millions of dollars in fresh infrastructure incentives in a move that may force neighbouring Alberta to respond to in kind. … “The oil and gas industry’s capital is mobile — it can be invested anywhere in the world, so if you want to be a part of that, you want to ensure you have a competitive jurisdiction,” Blair Lekstrom, B.C.’s minister of energy, mines and petroleum resources, said in an interview. “We want to secure the future of the oil and gas industry in British Columbia.” … While the two provinces are in fierce competition with each other, the royalty rate war extends beyond Canada’s borders. Prolific natural gas basins such as the Barnett shale in Texas and the Marcellus in Pennsylvania are sponging up billions of dollars worth of investments.”

Multi-frac Horizontals A Game Changer For Western Canada. Nickle’s Energy Group. “Not long ago, the world’s biggest oil companies had largely written off Western Canada. Apart from the oilsands, all the big prizes had been found, the thinking went, and the billions of barrels of crude oil and trillions of cubic feet of natural gas remaining in known fields were deemed unrecoverable. Industry giants were selling acreage and heading overseas, or offshore and even into the Arctic. But that was before advances in horizontal drilling and completion techniques opened up gigantic new gas plays in the northeastern British Columbia and crude oil resources in southern Saskatchewan. Now the multi-frac horizontal technology that opened up B.C.’s Montney and Horn River gas riches and Saskatchewan’s Bakken tight oil treasure are being deployed in many other formations across Western Canada. The success of companies such as EnCana Corporation in the Montney and Petrobank Energy and Resources Ltd. in the Bakken has been extensively reported. This article is merely a sampling, not an exhaustive summary, of attempts to take multi-stage fracturing in horizontal wells beyond those horizons.”

Energy In Depth: Today’s News

Federal fracking rules would be burdensome. Denver Post, LTE. “It’s certainly true that the oil and gas industry is very unhappy with the state’s new permitting rules — rules that have made it nearly impossible for energy companies to get new drilling permits. It is also true, however, that certain other rules passed by the state were supported and even championed by industry. The rule requiring companies to disclose fracking additives is one of those rules, enjoying broad support and industry input. The common procedure of hydraulic fracturing is regulated by the state, very heavily so, in fact. Anyone who understands even basic geology knows that it is impossible for fluids from fracking to travel from 8,000 feet below the surface to anywhere near water supplies. The important issue when it comes to fracking is the integrity of the cement and metal casing of the pipe. The state requires myriad tests to ensure that integrity, which is why federal regulations would be overly burdensome.”

Natural gas reserves may grow. Omaha World-Herald. “A new technique that tapped previously inaccessible supplies of natural gas in the United States is spreading to the rest of the world, raising hopes of a large expansion in global reserves of the cleanest fossil fuel. Italian and Norwegian oil engineers and geologists have arrived in Texas, Oklahoma and Pennsylvania to learn how to extract gas from layers of a black rock called shale. Companies are leasing huge tracts of land across Europe for exploration. The global drilling rush is still in its early stages. But energy analysts are already predicting that shale could reduce Europe’s dependence on Russian gas. They said they believed that gas reserves in many countries could increase over the next two decades, comparable with the 40 percent increase in the United States in recent years. “It’s a breakout play that is going to identify gigantic resources around the world,” said Amy Myers Jaffe of Rice University. … Shale is a sedimentary rock rich in organic material that is found in many parts of the world. It was of little use as a source of gas until about a decade ago, when U.S. companies developed new techniques to fracture the rock and drill horizontally.”

Assembly of peak oil experts look at shale gas. The Durango Herald. “Udall is a co-founder of the Association for the Study of Peak Oil-USA and the brother of U.S. Sen. Mark Udall, D-Colo. At Monday’s national peak oil conference in Denver, he tried to make sense of major changes in the gas industry the last few years. The Potential Gas Committee at the Colorado School of Mines made national news this summer when it announced that, largely because of shale gas, the United States has a 100-year supply of domestic natural gas. Shale-gas deposits lie under parts of Southwest Colorado that have never been drilled, including Montezuma, Dolores and western La Plata counties. Gas executives have seized on the study to push for a much greater role for their product in electricity generation, especially as the Senate prepares to debate a climate-change bill. “I truly believe that natural gas is the common thread of the economy, the environment and energy security,” said Peter Dea, former president of the Colorado Oil and Gas Association.”

Chinese officials’ visit to Oklahoma puts focus on energy. The Oklahoman. “More than a dozen professors from China University of Petroleum in Beijing were in Oklahoma over the weekend to learn about natural gas production. They were guests of the Harding Shelton Group, a team of experts in extracting gas from shale formations. The company, which has offices in Oklahoma City and Dallas, is hoping to establish a foothold in China, a country thought to have significant natural gas resources. “Collaborative efforts like these help all of us globally address the demands for new energy sources,” company Chairman John Shelton said. “The opportunities to produce shale gas in China are similar to what has taken place in the United States in highly productive areas like the Barnett Shale.”

Fort Worth League of Neighborhoods gets grant to educate about pipelines. Fort Worth Star Telegram. “A neighborhood group has received a federal grant to help educate the public about natural gas pipeline safety. The Fort Worth League of Neighborhoods will spend part of the $48,300 grant on consultants who will study the effect of pipelines on land development, how their placement affects safety and environmental issues related to pipelines.  Another part of the effort will be educating residents on pipeline safety, including how to identify pipelines and how to report a problem with one. Fort Worth is in the midst of a pipeline building boom because of the Barnett Shale natural gas field. About 2,000 gas wells have been drilled inside the city limits and each requires a pipeline connection. The league has helped neighborhoods negotiate leases with natural gas companies and has pushed for stricter safety regulations on drilling.”

Second Haynesville Shale Expo planned for next month. Shreveport Times. “A year ago, northwest Louisiana residents were still on fact-finding missions on the ins and outs of the Haynesville Shale natural gas development. And the first Haynesville Shale Expo held in November provided some of their answers. It was so successful — with more than 5,000 people attending — that chambers of commerce in the region are partnering to bring another one to the public. The one-day event Nov. 13 will be offered free to Ark-La-Tex residents, with a variety of informational sessions and dozens of displays from participating industry-related companies. The expo will be held in the Shreveport Convention Center from 9 a.m. to 6 p.m. Major contributors are Chesapeake Energy, Devon Energy, EnCana Oil & Gas, Petrohawk Energy Corp., Shell Exploration & Production and XTO Energy.”

Tenaska Plans Haynesville Shale Gas Gathering System. The Energy Daily. “Expanding on the company’s recent entry into the booming unconventional shale gas sector, Tenaska Capital Management LLC, an affiliate of independent power producer Tenaska Energy Inc., announced plans last week to build a new 140-mile natural gas gathering system to improve takeaway for producers in the Haynesville Shale. The announcement comes less than two months after Tenaska Capital Management (TCM) announced a joint venture with Energy Spectrum Capital aimed at acquiring, developing and operating midstream U.S. gas infrastructure assets in the Mid-Continent, Permian Basin and other fast-growing shale gas plays. … “The Haynesville formation has the capacity to be one of the most productive of the deep shale formations in the U.S. We believe the Haynesville formation will keep this pipeline operating at capacity for years to come.”

Analyst: Gas shale may be next bubble to burst. Associated Press. “The promise of enough natural gas to last the United States more than 100 years based on discoveries of vast shale formations could be the country’s next speculative bubble to burst, a speaker warned Monday at a conference exploring the notion that the world’s oil and gas are diminishing rapidly. Arthur Berman, a Texas-based geological consultant, likened the optimistic projections for production from gas shale fields across the country to banks buying into mortgage securitizations, which spurred the housing market crisis and economic meltdown. “In the midst of a boom or a bubble, it’s hard to sit on the sidelines,” Berman said during the Association for the Study of Peak Oil and Gas conference. “If you’re not in one of these plays, then Wall Street says, ‘Well, what’s the matter with you guys?’”

3 meetings planned on gas drilling efforts in Ithaca region. Ithaca Journal. “A public information session on Marcellus shale natural gas exploration will be held 7 p.m. to 9 p.m. Tuesday, Oct. 27 at the Unitarian Church of Ithaca, 306 N. Aurora St., Ithaca. The Cornell Cooperative Extension of Tompkins County program will provide an overview of the relevant geology and water issues related to drilling and hydrofracking and the potential economic benefits and community impacts.”

Water source reporting required of oil and gas operators. Shreveport Times. “Effective this month, the state conservation office will enforce a new requirement for reporting water sources utilized by oil and gas companies for hydraulic fracturing operations. The policy is in response to the intense development of the Haynesville Shale natural gas formation in northwest Louisiana. The reporting requirement is part of the Office of Conservation’s efforts to ensure the balance between preserving the state’s natural resources while allowing responsible development, Commissioner James Welsh said. “We want to make sure we have the best information possible on how our resources are being used to help us make the best policy decisions in regulating industry and protecting the public now and in the future,” Welsh said in a prepared statement.”

Energy In Depth: Today’s News

Gazprom’s Houston debut starts ambitious growth strategy. Fort Worth Business Press. “The world’s largest natural gas producing company is aiming to get bigger by expanding its presence in North America, having recently commenced its gas trading business in Houston. Gazprom Marketing & Trading USA Inc., a subsidiary of Russian gas giant Gazprom, began buying and selling gas at the wholesale level across North America on Oct. 1 – marking the beginning of an ambitious business model that ultimately is expected to lead to its import of Russian gas for U.S. markets. … “We believe that gas demand will resume its growth once the economy returns to better health,” according to a Gazprom official. “It is also worth noting that EIA projections do not account for any [greenhouse-gas] emission laws. If the U.S. enacts greenhouse gas legislation, we expect gas to take a bigger share in the market against coal and oil. Also, conventional gas production is still in decline. Shale will replace some of the decline, but additional gas supply will be required, and LNG is a good source for that.” The move could mean stiff competition for Barnett Shale producers and shale gas exploration and production companies nationwide, already reeling from the weak demand and big surplus.”

Natural Gas: The Russians Are Coming! Forbes. “Gazprom for years has been a dominant player in the natural gas market through the use and control of pipelines. It exports gas to more than 30 countries and meets a quarter of Europe’s needs. The U.S. market, however, the largest in the world, has been too far away for Gazprom to reach. Pricey new liquefied natural gas developments, which allow for worldwide shipping, should change all that. Global LNG demand is expected to double by 2020.  ”LNG is a strategic way for Gazprom to get into markets that it can’t access by pipeline,” says Hattenberger. “It makes a lot of sense for the world’s largest gas company to bring gas to the world’s largest gas market and it has to be done through LNG.” … Unconventional shale gas plays, like the Haynesville in northern Louisiana and the Marcellus in the Northeast, are showing monstrous production rates, fueling arguments that the U.S. could move closer to energy independence by focusing on gas. But capital costs for LNG infrastructure have been sunk and cash will need to be generated almost at any price.”

Quicksilver sees rich future in Canada, Barnett Shale. Fort Worth Business Press. “Quicksilver Resources has enjoyed considerable buzz and a recent uptick in its stock price as a result of a new Canadian well with impressive initial daily production of 13 million cubic feet of natural gas. But the Fort Worth-based company’s bread and butter is still right in its back yard — the natural gas-rich Barnett Shale of North Texas. Already accounting for about four-fifths of the company’s production and three-quarters of its revenue, the Barnett is the “foundation for the company’s growth,” Quicksilver says on its Web site. … But for now and some years to come, the Barnett is likely to remain the No. 1 cash cow for the 580-employee company, which had slightly more than $800 million in revenue in 2008. Quicksilver officials estimate that they have a 10-year drilling inventory remaining in the Barnett. While Quicksilver has drilled about 700 Barnett wells, it says more than 1,300 remain to be drilled.”

There’s gold (sort of) in them hills. Buffalo News. “For the last couple of years, David Smith and other National Fuel Gas Co. executives have talked a lot about the potential that the company could be sitting on some really big natural gas reserves. Not anymore. Less than three weeks after reporting that its first wholly owned horizontal gas well in northwest Pennsylvania was a real gusher, there’s a growing sense of excitement and confidence that National Fuel is part of something that could be really big. … Then, less than a decade ago, came a new type of well-drilling technology that is opening up vast areas of natural gas that conventional techniques couldn’t tap. Instead of drilling wells that go straight down, drillers now start off with a vertical well and then make a gradual turn that sends the drill horizontally through another half mile or so of rock. Drillers then pump mixtures of water, sand and chemicals into the wells to release the gas trapped within the porous rock formations.  The result is that a horizontal well, in just the right place, can tap into far larger natural gas deposits than a well that just goes straight down. A conventional gas well, costing about $250,000 to drill in less productive portions of the Southern Tier or northwestern Pennsylvania, might produce about 100,000 cubic feet of gas per day, roughly enough to supply 1,000 homes for a year.”

Drilling regs hearing will reveal issues. Times Herald-Record. “How can the state use just one well to set regulations for the impact of gas drilling on water, roads and air when dozens, even hundreds, may be built in places such as Sullivan County? Shouldn’t the gas companies address the cumulative impacts of all those wells? That’s just one issue that environmental groups plan to raise Thursday at the state Assembly hearing on the Department of Environmental Conservation’s proposed regulations for gas drilling of the Marcellus shale, which sits beneath Sullivan and other counties. The hearing, held by the Assembly’s Environmental Conservation Committee, should provide a preview of issues that will be raised at other hearings in coming months before the state finalizes those rules.”

Dallas revising zoning to regulate gas drilling. Wilkes Barre Times-Leader. “There’s no natural-gas drilling in Dallas, but that’s not stopping the borough from deciding where it will allow drilling. As part of the revision of its zoning ordinance, Dallas is adding provisions that would restrict sitting gas wells to areas zoned industrial, highway or business. It would also designate distance setbacks from residences, waterways, streets and wetlands. The proactive stance is putting Dallas at the forefront of what could become a major issue as drilling in the Marcellus Shale increases. “You’re talking about a very fundamental conflict between the municipal regulation of land use and the ability of landowner to access land rights,” said Stephen Rhoads, the president of the Pennsylvania Oil & Gas Association. “You could think of this in terms of taking.”

Marcellus question: Who will pay to monitor gas drilling? Press & Bulletin. “The state is asking local government agencies to regulate key aspects of the natural gas industry, raising yet more questions about who will pay for manpower to oversee multinational energy companies setting up shop in Southern Tier’s backyards. The industry’s effect on water resources and roads are included in a report released Sept. 30 by the Department of Environmental Conservation outlining environmental concerns from full-scale Marcellus Shale development. Risks to water, the report says, include turbidity, methane contamination and, to a lesser degree, potential for hazardous chemicals to breach well-bore casings or spill while being handled or disposed of on the surface.”

Range Resources hires two for Marcellus Shale. Fort Worth Business Press. “Range Resources Corp. continues to increase its Marcellus Shale presence and recently hired two Pennsylvania natives to work out of the company’s regional office in Pittsburgh. The Fort Worth-based oil and gas exploration and production company hired Joseph H. Frantz Jr. as vice president of engineering and K. Scott Roy as vice president of government and regulatory affairs for its Marcellus Shale division, according to a press release.”

It’s time to take action. The Oklahoman, Op-Ed. “What is it about government that seems to encourage inertia? In my nine months in office, I’ve yet to find an answer to that question. Government is great at talking about issues and problems, but talk is like any other commodity — the more of it there is, the cheaper it gets. It’s not a people problem. I see talent everywhere I look. Is there something about the institution of government that discourages the eagles from soaring? What I hear all too often is not what we can do, but rather what we can’t do. … For example, at my request, the Corporation Commission this summer held a hearing on issues associated with horizontal drilling. The concerns voiced by mineral and surface owners, working interest owners, producers and others who packed the hearing could have been viewed as overwhelming. But I and others saw them as challenges to be met. Horizontal drilling is too important to the state’s economy to fail to act. We got started. The commission is facilitating groups made up of representatives from all interested parties to work on solutions.”

Town hall will focus on slant well drilling. Mcalester News Capital. “Drilling for natural gas is no longer an up and down propoposition. The Oklahoma Corporation Commission is participating in a public town hall meeting in McAlester on Monday related to the newer procedure of horizontal gas well drilling. Hosted by the National Association of Royalty Owners, the meeting is set for 6 p.m. at the Southeast Expo Center west of the city on U.S. Highway 270. Oklahoma Corporation Commissioner Dana Murphy been meeting with NARO at a series of town hall meetings on the matter. She’s set to attend the meeting in McAlester to help address issues connected with the horizontal drilling process. … Horizontal drilling has been promoted as a way to get to natural gas that had previously been considered unextractable. “In horizontal drilling, you drill down a hole and then you go horizontally,” Skinner said. It’s considered by many experts in the fields as the only feasible way of doing shale production, which entails extracting natural gas from shale, he noted.”

Energy In Depth: Today’s News

In defense of hydro-fracking. Ithaca Journal, EID’s Lee Fuller. “A Sept. 23 letter cites a recent Reuters piece on Environmental Protection Agency testing of water wells in Wyoming, and uses it to perpetuate the idea that a 60-year old energy technology known as hydraulic fracturing may be linked to possible contamination. Your readers should know that, contrary to what was reported in Reuters and rehashed by the letter writer, EPA itself has suggested no such link exists. … The fact is, hydraulic fracturing technology has been called upon more than 1.3 million times over the past half century, and is used today to stimulate the flow of energy in nine out of 10 wells in America. Some folks might consider it an amazing stat that, in all this time, not a single case of drinking water contamination has been credibly tied to the technique.”

Spill distinction. Scranton Times Tribune, EID’s Lee Fuller. “Although it’s a distinction likely to be lost on the activists quoted in your Sept. 28 article (“Shale drilling stirs concern”), the recent spill of nontoxic materials near Dimock Twp. earlier this month had nothing to do with the hydraulic fracturing procedure. Instead, it was an incident created by a faulty pipe coupling, part of a mixing process that took place far away from the drilling pad. … The state Department of Environmental Protection has responded to the Dimock incident as just what it is — an incident where procedures need to be improved. DEP understands that hydraulic fracturing is a critical technology that we need to unlock the extraordinary potential for jobs, revenue and energy security ready and eager to be found in the Marcellus. It also understands that producers and fracturers must demonstrate that they will properly manage it.”

Buying Natural Gas. International Business Times. “Unconventional gas production already makes up close to 40 percent of US gas output. And that number is only going to rise in the coming years. Suffice it to say that two techniques have totally revolutionized unconventional field production: horizontal drilling and fracturing. By drilling horizontally through unconventional rock formations, producers can expose more of their well to productive zones. And increasingly effective fracturing techniques allow producers to vastly improve the permeability of unconventional fields. This is a fancy way of saying that fracturing makes it easier for gas in a reservoir to flow into a well. Most of my favorite plays on natural gas are either directly or indirectly related to unconventional reserves in the US.”

Gas drilling coming to the Finger Lakes? Canandaigua (NY) Daily Messenger. “The state released new environmental regulations last week for natural gas drilling, clearing the way for well permits in the Finger Lakes region. The largely untapped gas reserve, sweeping much of the state, has put many people on alert. Questions and concerns about what the drilling will mean for the environment and economy here have prompted a number of groups to join forces. … Brad Gill, executive director of the Independent Oil and Gas Association of New York, said the state’s regulations already were regarded as the nation’s strictest, but he didn’t feel the additional rules would discourage drilling. Gill said with the regulations getting final approval, expected around the first of the year, “I think we will see drilling in New York and the economic boom associated with it.”

Perry named chairman of oil group that opposes climate change legislation. Dallas Morning News. “The Interstate Oil and Gas Compact Commission, a voice against climate change legislation, named Gov. Rick Perry chairman. … The commission works to ensure that the nation’s oil and gas resources are conserved and maximized while protecting health, safety and the environment. IOGCC also acts as an advocate for the states in Washington D.C., and is heavily involved in setting national energy policy. Currently, the IOGCC is focused on keeping the regulation of carbon sequestration and hydraulic fracturing at the state level, as a one size fits all approach would not be successful.”

Companies bet big on South Texas gas find. Houston Chronicle. “Last October, just as the economy was tilting into crisis, a small oil and gas company in Houston quietly announced the discovery of a mammoth natural gas field in South Texas that at any other time might have garnered bigger headlines. Petrohawk Energy’s find, however, did not go unnoticed in the oil and gas industry — and it didn’t take long before oil companies large and small began making their moves.  Today, though the economy and natural gas prices remain weak, the Eagle Ford shale remains one of the hottest prospects in North America, and energy companies are moving forward there even as they’re pulling back elsewhere. … Recently discovered U.S. shale plays, including the Haynesville in Louisiana and Marcellus in Pennsylvania, are expected to provide a major boost to U.S. natural gas supplies in coming years. The dense rock formations, once thought too difficult to explore, have been unlocked with the help of recent advances in drilling technology. … Yet that has not stopped companies from pushing ahead in the Eagle Ford play, which starts near the Mexican border and extends east below San Antonio across a string of counties including Webb, Dimmit, LaSalle, McMullen and Live Oak. “It’s got the potential of being a boom,” said Martin, whose family leased to Petrohawk, noting that land prices in the region have risen to $1,500 per acre in some places, 10 times what they were two years ago.”

Wheeling considers allowing drilling around parks. Associated Press. “Wheeling is considering allowing a natural gas producer to drill in the area of two city parks. City Council plans to consider a lease agreement with Chesapeake Appalachia on Tuesday evening. A public hearing will be held before the proposal is considered. Chesapeake Appalachia wants to drill for natural gas in the area of Oglebay and Wheeling parks. Deep underneath the land is a thick, black rock called Marcellus shale thought to be the nation’s most prolific natural gas reservoir.”

Hearing Tonight For Natural Gas Drilling. Wheeling News Register. “G. Randolph Worls said natural gas development on land owned by the city and the Wheeling Park Commission could yield “significant dollars.” City Council, however, first must pass a resolution allowing City Manager Robert Herron to enter a lease agreement with Chesapeake Appalachia during today’s meeting to allow such drilling to occur. A public hearing on the matter is set to take place during a 7 p.m. meeting today before council votes on the matter. “It is really hard to say how much money it could generate. … There is potential for significant dollars, if everything goes perfectly,” said Worls, president of the Oglebay Foundation.”

Local lawmakers react to severance tax, gas drilling. Williamsport Sun-Gazette. “Area legislators have different opinions on a state severance tax for natural gas drilling. Such a tax will not hurt efforts to pass a state budget, according to state Rep. Rick Mirabito, D-Williamsport. “People should contact their representatives and say this is a very fair way to do it,” he said. “It should not set things back.” The House bill calling for a natural gas severance tax, he said, will return those revenues to the municipalities where gas is drilled. … But State Rep. Garth Everett, R-Muncy, said the question of imposing a severance tax warrants more discussion. Such a tax, according to a Penn State study, will decrease Marcellus Shale development by 30 percent, he noted. “Looked at another way,” he stated in an e-mail written to Responsible Drilling Alliance, a local organization keeping a close eye on Marcellus Shale drilling, “that is a 30-percent reduction to the incomes of those who live in the areas, like the district I represent, where Marcellus Shale exists. It will also reduce future local tax revenues by stunting the incomes and property values of many who would benefit from this development.”

Marcellus Shale report still unbound. Press & Sun-Bulletin. “Advocates are still waiting for hard copies of the state’s assessment of natural gas production from the Marcellus Shale, and details about how they can comment on it. As of Monday, officials from the state Department of Environmental Conservation said they did not know when copies of the report, released Wednesday online, would be available in libraries and other locations. Nor were they sure whether they would extend the comment period, or hold public hearings. The report, which assesses the environmental impact of drilling, is at the center of a controversy about risks of full-scale development of the Marcellus Shale in the Southern Tier.”

Gas Shale—2: Lessons learned help optimize development. Oil & Gas Journal. “Exploring for resource quality, building advanced technological capability, pursuing improved performance and cost efficiencies, and adopting high-value entry strategies are some factors leading to successful exploitation of gas shales. … Efficiently pursuing gas shales is a high-tech undertaking, involving production of hydrocarbons that the industry traditionally has viewed as an essentially impermeable source or cap rock. The technological leap that cracked the technological code was the introduction of horizontal drilling supplemented by intensive hydraulic stimulation.”

Energy In Depth: Today’s News

Natural gas quest: Technical report carving deep divisions between gas companies and industry critics. Press & Sun-Bulletin. “The latest volume of an epic story about the Southern Tier’s global energy ambitions is still being printed, and it has already generated plenty of buzz. It’s in the form of an 809-page technical report detailing the hazards and safeguards associated with harvesting the Marcellus Shale, the largest natural gas reserve in the country. … Industry officials, ironically, were generally enthusiastic about the plan intended to regulate them. Lee Fuller, policy director for Energy In Depth, a national trade organization, held it up as a model of how states can fairly and effectively make their own rules. The organization is part of a concerted effort by the industry to kill a bill proposed by Rep. Maurice Hinchey, D-Hurley, that would bring a process involving chemical stimulation of wells, called hydraulic fracturing — or fracking — under federal jurisdiction. “Amazingly, even on a day when DEC released some of the most restrictive fracturing rules in the entire country, some would rather throw out the entire document, render the review process null and void, and hand over to EPA the authority to do what DEC is more than capable of doing itself,” Fuller said.”

Opportunity knocks for midstate businesses. Patriot-News. “The economic ripple effects of Pennsylvania’s Marcellus Shale boom have reached the midstate. Engineers, geologists and other professionals in the Harrisburg area have grabbed business opportunities tied to the surge in drilling for natural gas in the shale layer. One of the players is Hershey-based ARM Oil and Gas Solutions. Senior associate Andrew Joyner said the opportunities are only beginning. … The amount of natural gas trapped in the Marcellus Shale is believed to be one of the largest deposits in the world. The shale layer runs under much of northern and western Pennsylvania.”

Wayne County businesses look to natural gas drilling for opportunities. Scranton Times-Tribune. “Drilling for natural gas in the Marcellus Shale has not begun in Wayne County, but community organizations and businesses are already keeping an eye on possible economic benefits. Noting people have stopped in the Wayne County Chamber of Commerce to ask about jobs associated with natural gas drilling, chamber Executive Director Donna LaBar said they plan to “provide information to business so they don’t miss any opportunities.” Providing information is just one part of an attempt to capitalize on the industry’s activities. The chamber and other organizations also are forming a task force, while attempting to meet the infrastructure, job and service needs of natural gas companies. … With the drilling, companies will need many services, including engineering consultants, welders, lodging and catering, Chesapeake spokeswoman Maribeth Anderson said. “The Marcellus industry purchases of goods and services, their royalties to landowners and tax payments directly create more than 14,000 jobs in Pennsylvania,” Ms. Anderson said. “Indirect and induced impacts create even more jobs so that total jobs created by the Marcellus industry is estimated at 29,000.”

Central Pennsylvania engineers, others finding work in Marcellus Shale. Patriot-News. “A very public debate over the vast and largely untapped wealth of Marcellus Shale has embroiled politicians in Harrisburg this year. Meanwhile, in a mostly private but economically important phenomenon in the midstate, engineers, geologists and other professionals have been getting more work associated with the natural gas-rich shale. “I don’t think people truly fathom how big this is, or is going to be. It is probably going to be the biggest thing that ever happened economically in Pennsylvania,” said Andrew Joyner, a senior associate at ARM Oil and Gas Solutions of Derry Township. … The potential supply of natural gas trapped in the Marcellus Shale layer is believed to be one of the largest in the world. In 2008, 195 Marcellus gas wells were drilled in the state, and 329 were drilled this year by the end of August.”

Focus of natural gas exploration in Pa., not NY. Rochester Democrat and Chronicle. “Parts of Pennsylvania are in the midst of a gold rush of sorts, and the same forces behind it are eyeing New York next. The Marcellus Shale Formation — a 95,000-square-mile stretch of subterranean rock loaded with natural gas — stretches from West Virginia into the Southern Tier. And natural gas drilling and extraction has rocketed in parts of Pennsylvania in recent months. … But Marcellus Shale drilling is nonexistent in New York for now. Mara Ginsberg, legislative counsel for the Independent Oil and Gas Association of New York, told members of The Business Council of New York State in Rochester last week that environmental concerns and a regulatory overhaul going on at the state Department of Environmental Conservation are the reasons behind the lack of activity. … “The Marcellus has some of the most compelling economics in the natural gas industry right now,” he said at The Business Council gathering.”

Gas, coal engineers team to capture methane. Casper Star-Tribune. “Advocates for harnessing coal mine methane point out that a careful collaboration between gas developers and coal companies is key to success. At the Cumberland Mine in Pennsylvania, for example, gas developers have used horizontal drilling techniques to tap some 268,000 cubic feet of gas per acre, from thousands of acres. Not every underground mine is a good candidate for a methane-capture program, however. Many are too small or don’t have enough gas to justify the investment. … At the same time, the gas industry has made quantum leaps in horizontal drilling and well stimulation techniques to tap the gas before, during and post-mining. Companies such as Caterpillar and General Electric are eager to provide the distributive generation and other facilities needed to make use of the methane once it’s brought to the surface. “We need to have a long-term view of these coal properties and focus on pipeline-quality gas,” Schwoebel said.”

Exploration, production companies hold promise for investors wary of oil stocks. Milwaukee Journal Sentinel. “We’re not at the country clubs and health clubs in Houston hearing what’s going on,” said Lilly, a portfolio manager at Cortina Asset Management LLC in Milwaukee. Technological leaps have changed the way Lilly looks at things. Horizontal drilling has given companies the ability to drill down 8,000 to 10,000 feet, make a 90-degree turn and drill as far as they need to go. Hydraulic fracturing involves pumping thousands of pounds of hydraulic pressure into a drilled hole to create cracks and perforations that allow oil and gas to flow more freely. These innovations have opened up vast opportunities in shale rock formations that date back to the age of dinosaurs, and they have created overnight millionaires out of farmers in places such as Louisiana and North Dakota. Consequently, the U.S. has gone from an under-supply to an abundance of natural gas, and there’s a lot more incentive to drill for gas and oil on dry land in the U.S. The drilling success rate for shales has been close to 100%, much higher than with conventional wells, Lilly said.”

Energy In Depth: Today’s News

NY natgas drilling rules plan seen raising costs. Reuters. “Energy companies believe New York State’s plans to require disclosure of chemicals used in natural gas drilling and tighten environmental safeguards will boost industry costs but help calm public fears of water contamination, executives said on Thursday. New York City Mayor Michael Bloomberg reserved judgment on the state Department of Environmental Conservation plan, published on Wednesday, which he said he had not read yet. But he pledged to fight for stricter regulations if he felt they were needed to protect the city’s upstate reservoirs. The proposed regulations would require gas companies to specify the composition of fluid used for their hydraulic fracturing or “fracking” operations, which have been criticized for contaminating drinking water. … Brad Gill, executive director of the Independent Oil and Gas Association of New York, said the new regulations would increase costs but would not make drilling impossible. “They certainly will increase the cost of exploring for and producing our gas,” he said. “It’s an increased burden but I think it’s doable.”

Spills, Looming Regulations Spur Natural Gas Industry Toward Disclosure. New York Times. “The natural gas industry is moving to disclose information about chemicals used in controversial extraction technologies in the wake of spills at drilling sites in Pennsylvania and as New York is proposing new regulations. … DeGette introduced her legislation, H.R. 2766, in June, and the Senate came out with companion legislation, S. 1215 (pdf), the same day. Neither bill has moved out of committee, but Eisnela said DeGette plans to continue pushing for her measure. … “We have begun a review of the [supplemental generic environmental impact statement] and remain hopeful that the state [Department of Environmental Conservation] has found a balance that continues to protect New York’s environment and allows responsible exploration for natural gas in the Marcellus shale,” Brad Gill, executive director of the Independent Oil and Gas Association of New York, said in a statement. “A regulatory structure that is tough but fair will allow this state to realize this tremendous opportunity,” Gill said.”

Natural Gas Drilling and Boost to Local Economy. WETM-TV. “Out of towner, Eshton Ritenour, is pumping money into the local economy. Her husband works as a welder for precision pipeline, a company helping to drill for natural gas in the northern Tier. Eshton Ritenour said, “We have to pay rent, groceries, just the normal stuff.” There are nearly 30 other families like Ritenour’s in Troy. The Borough Manager says the Marcellus Shale drilling has really helped bring money to the community. … Tom Santulli, The Chemung County Executive Said, “I’m a firm believer natural gas exploration and the jobs and revenue that it could bring to this area could really reshape the region and actually help off set taxes here because it’s actually a product that will produce revenue.”

New York state releases Marcellus shale drilling proposal. Oil & Gas Journal. “The New York State Department of Environmental Conservation (DEC) released a draft proposal to govern potential natural gas drilling activities in the Marcellus shale, specifically horizontal drilling and hydraulic fracturing. The Supplemental Generic Environmental Impact Statement (SGEIS) outlines safety measures, protection standards, and mitigation strategies that operators would have to follow to obtain permits.  New York Gov. David A. Paterson directed DEC to prepare the SGEIS. The state has not yet allowed any horizontal development of the Marcellus shale. … “Well permitting and drilling is expected to be more onerous in New York,” than in some other states, Raymond James & Associates Inc. analyst John Freeman of Houston said in an Oct. 1 research note. “While the rules have not been set in stone, New York has provided a path in which operators could develop the Marcellus shale,” Freeman said. “Still it is too early to tell if exploration and production and oil field service companies will be willing to jump through these additional hoops to operate in New York.”

Lawmakers Applaud DEC Regulations. WBNG-TV. “State and local lawmakers applaud the Department of Environmental Conservation for it’s in depth report on new regulations for natural gas drilling. … Assemblywoman Donna Lupardo is impressed with the DEC’s draft on gas drilling regulations. She says it addresses many of her concerns, including chemicals used in the fracturing fluid. “We’re going to be requiring that these operators keep track of these fluids and sort of a chain of command. So from the beginning to the end of the process, they’re going to have to account for all of this water,” Lupardo says. … Libous says gas drilling could mean big business for the state.  ”It could be the new IBM, it could be the new EJ. I know that to put it in those kinds of terms, people are having a hard time understanding it but it can be,” Libous says.”

Marcellus gas drilling: Groups gear up for boom. Corning Leader. “For the past year, groups of landowners across Steuben, Chemung and Schuyler counties have been busy educating themselves about natural gas drilling in the Marcellus Shale and preparing to negotiate the best deal they can with energy companies. Now that Marcellus gas drilling is poised to explode across the area, those efforts may soon pay off. The Steuben County Landowners Coalition includes more than 1,000 property owners with roughly 75,000 to 80,000 acres of land that is either available for gas leasing, or soon will be as current leases expire, said organizer Kenny Knowles Sr. … “Right now, I think we’re looking at signing bonuses of $3,000-$5,000 per acre in this area, and 18 to 20 percent royalties,” Terwilliger said. “And I think within the next 3-5 years, you’re going to see upwards of $10,000 per acre and and 25 percent royalties.”

NY state weighs natgas drilling in Marcellus shale. Reuters. “New York State’s proposed new environmental rules allowing drilling for natural gas in the multi-state Marcellus Shale formation face opposition from environmental groups and, potentially, from New York City. The proposed state rules would allow drilling around water wells but require extra reviews, depending on whether the work was within 2,000 feet or 1,000 feet of the well. Some green groups want buffer zones created around upstate reservoirs to protect the city’s water from pollution. … Shale gas, or gas trapped in sedimentary beds, is seen as having the potential to provide the United States with affordable fuel that will help drive economic growth, reduce dependence on foreign oil and limit emissions for decades. … Brad Gill, executive director of the Independent Oil and Gas Association of New York, said the new regulations would increase costs but would not make gas drilling impossible. “They certainly will increase the cost of exploring for and producing our gas,” he said. “It’s an increased burden but I think it’s doable.”

Drilling regs up for review. Ithaca Journal, Editorial. “New York’s newest proposed regulations for a type of natural gas drilling called hydro-fracturing was a victory of sorts for the hundreds of people who showed up last year and raised environmental and safety fears about the process. … While some environmental groups might rather see an all-out prohibition of hydro-fracturing, state and local officials as well as landowners are poised to make way for drilling and the economic benefits they anticipate will come from it.”

Ideas floated on water-use policy. Albany Times Union. “While Thursday’s state Senate hearings on water policy touched upon a number of subjects — from pharmaceuticals in drinking water to beach closures caused by sewage runoff — the dominant topic for many advocates was the coming boom in natural-gas mining projects that use hydraulic fracturing, or “hydrofracking.” The technology uses large amounts of water — up to a million gallons per well, according to the state Department of Environmental Conservation — to blast deep into dense rock like Marcellus Shale, which reaches up from Pennsylvania into central New York. The vast geological formation is one of the nation’s largest repositories of natural gas.”

Despite new regulations, gas drilling in state is not imminent. Ithaca Journal. “With only 17 inspectors to enforce the state’s newly proposed regulations overseeing the natural gas industry, it will be a while before the gas rush moving up the Appalachian basin takes hold in the Southern Tier. Both proponents and critics of the gas industry agreed on that much Thursday, a day after the state released its much anticipated regulatory update overseeing production of the gas-rich Marcellus Shale. “They do not have the manpower to do this. That’s no secret,” said Lindsay Wickham, a field adviser for the New York State Farm Bureau, an agency that advocates landowners’ interests.”

Dominion Proposes New Marcellus Shale Pipeline. Energy Daily. “Saying the project will help boost the flow of natural gas out of the Marcellus Shale, Dominion announced Monday it has requested federal pre-filing regulatory review of a proposed new 110-mile pipeline designed to transport gas from West Virginia and southwest Pennsylvania to northeastern and Mid-Atlantic markets. In a filing at the Federal Energy Regulatory Commission Monday, Dominion sought early review of its planned Appalachian Gateway pipeline, which it says is already fully subscribed by Marcellus Shale and other Appalachian gas producers. … “Marcellus Shale and traditional production have increased the natural gas available from the Appalachian Basin,” said Gary Sypolt, chief executive officer of Dominion Energy. “The Appalachian Gateway Project will lessen the bottleneck currently preventing some of the natural gas produced in West Virginia and southwest Pennsylvania from getting to customers in the Northeast and Mid-Atlantic who are in need of new supplies.”

Producers look to the north for latest natural gas bounty. Fort Worth Star Telegram. “Stone Mountain Resources is just a 3-year-old, 12-employee company based in the Canadian oil capital of Calgary, but it’s taking on an ambitious project as one of the pioneers drilling for natural gas in Canada’s Horn River Basin, a remote, bitterly cold corner of far northeast British Columbia. The lure of Horn River is obvious. The Canadian Society for Unconventional Gas estimates that there is an enormous volume of natural gas in place — as much as 500 trillion cubic feet — according to a Sept. 22 report by the commodities research unit of Barclays Capital. If only 20 percent of the gas proved recoverable, that could total up to 100 trillion cubic feet of production, more than quadruple annual U.S. natural gas consumption. … Klingensmith said he could foresee Stone Mountain drilling perhaps 360 Horn River wells over 30 to 40 years, potentially recovering as much as 40 percent of the gas in place as more knowledge is gained about how to best drill and complete wells there. The company has five producing horizontal wells. Each cost about $10 million to drill and complete, including hydraulic fracturing to stimulate greatly increased gas flow to the wellbore.”

Energy In Depth: Today’s News

Full Disclosure: Schlumberger, Hydraulic Fracking and the Public Access Debate. BNET Energy. “Fracking has been used for decades. But it has become the subject of a recent regulatory and public disclosure debate spurred by standalone bills in the House and Senate that seek to end an exemption for hydraulic fracturing within the Safe Drinking Water Act.  The Environmental Protection Agency would regulate the process and new public disclosure rules would be implemented, under measures outlined in the bill. … But the industry advocacy groups like Energy In Depth, which works with the Independent Petroleum Association of America, say simply providing a list of chemicals will only create confusion and unnecessary fear. “Context is everything,” said Chris Tucker, spokesman with Energy In Depth, in a phone interview Tuesday. “If you’re a member of the public and are handed a list and see hydrochloric acid being used — even though it’s a negligible amount — that’s going to catch your attention. The MSDS (materials safety data sheets) does not provide the proper context.”

State Issues Rules on Upstate Natural Gas Drilling Near City’s Water. New York Times. “After months of deliberations, state environmental regulators on Wednesday released long-awaited rules governing natural gas production in upstate New York, including provisions to oversee drilling operations near New York City’s water supplies. The regulations, in a report requested last year by Gov. David A. Paterson, do not ban drilling near the watersheds, as many environmental advocates had urged. But the report sets strict rules on where wells can be drilled and requires companies to disclose the chemicals they use.”

NY regulators release gas drilling rules. Associated Press. “State officials have completed new environmental regulations for natural gas drilling that will clear the way for well permits in New York’s part of a rich field that covers parts of four states. … More than a year ago, Gov. David Paterson told the Department of Environmental Conservation to address concerns about drilling in the region, which covers the southern half of New York. The order effectively halted drilling there. … Brad Gill, executive director of the Independent Oil and Gas Association of New York, said the state’s regulations already were regarded as the nation’s strictest, but he didn’t feel the additional rules would discourage drilling. … “A lot of them are just waiting for the green light to drill” under the new rules, Gill said. When the regulations get final approval, expected around the first of the year, “I think we will see drilling in New York and the economic boom associated with it.” … Democratic Reps. Diana DeGette of Colorado and Maurice Hinchey of New York are sponsoring a bill that would place hydraulic fracturing under oversight of the federal Safe Drinking Water Act. New York’s new regulations, contained in a 500-plus page document, address the potential effects of horizontal drilling and high-volume hydraulic fracturing, known as “hydrofracking.”

Natural gas quest: DEC proposes environmental regulations. Elmira Star-Gazette. “Energy companies pursuing the Marcellus Shale in New York can expect to face additional regulations, including on-site inspection of certain drilling procedures and pre-emptive testing of the air and soil. Those are a few conditions proposed by a set of draft regulations aimed at prospectors from throughout the country — including multi-national energy firms — staking out land to tap the rich natural gas reserve under Broome County. The state Department of Environmental Conservation released the 500-page document late Wednesday outlining dozens of new steps to protect the environment from potential hazards of horizontal drilling and the high volumes of waste it produces.”

DEC drafts regulations for gas drilling. Times Herald-Record. “It’s the state’s first step to ultimately green light gas drilling in Sullivan County: The Department of Environmental Conservation Wednesday issued regulations to assure that the drilling of the gas-rich Marcellus shale will preserve the environment many fear will be harmed, particularly by the shale-fracturing process of “fracking.” … the executive director of the Independent Oil and Gas Association of New York, Brad Gill, said he was “optimistic that the state DEC has found a balance that continues to protect New York’s environment and allows responsible exploration for natural gas in the Marcellus shale.” He pointed to the industry’s “outstanding record of … safety” in the state.”

Dominion Peoples customers getting a break on gas rates. The Tribune-Democrat. “Natural gas rates are dropping by 11 percent on an average bill as part of a quarterly rate adjustment by Dominion Peoples that takes effect today. The average residential bill will fall from $85 per month to $76, Joe Gregorini, Dominion Peoples manager of pricing, said from Pittsburgh. … Natural gas formations in Marcellus shale already are being tapped in Pennsylvania and elsewhere in Appalachia, Gregorini said, further dampening price pressure.”

For North Texans, plenty is riding on natural gas prices. Fort Worth Star Telegram. “Which way are natural gas prices headed? In North Texas, that’s an especially relevant question. The price of natural gas affects Barnett Shale natural gas producers and their employees, oilfield service companies and many thousands of mineral leaseholders who are reaping—or eventually hope to reap—royalties from gas wells drilled in the area. And because natural gas is burned to generate electricity and heat homes, its price affects virtually everyone who pays electric or gas bills.”

Energy In Depth: Today’s News

Barnett Shale seen as model for drillers worldwide. Fort Worth Star Telegram. “The search for unconventional natural gas deposits in areas like the Barnett Shale of North Texas not only is dominating gas drilling in the United States, but it will also become pervasive worldwide. That was the message given Tuesday by two experts at the opening of a three-day energy conference in the Fort Worth Convention Center. “I think unconventional gas is the future, both in the U.S. and overseas,” said Vello Kuuskraa, president of Advanced Resources International, known for his work in energy economics and petroleum recovery technologies. Unconventional gas includes shale gas, tight gas and coal-bed methane, deposits that require measures such as horizontal drilling and hydraulic fracturing to enhance their recovery and make them economically feasible. Unconventional gas accounts for more than half of U.S. production, Kuuskraa said, even though what he called two new “rock stars” among shale fields — the Haynesville Shale in northwest Louisiana and East Texas, and the Marcellus Shale in the Appalachian region of the eastern United States — are just beginning to be significantly developed.”

Getting set for natural gas bonanza. Wayne Independent. “An upcoming five-part webinar series titled “Your Business and Marcellus Shale” aims to explore business opportunities arising from Marcellus shale. … When it comes to Marcellus shale exploration in Wayne County, Porter said, “We are just at the start of a major transformation in terms of workforce and how our community looks and functions, because this is an industry that’s planning to be here for the next 35 to 50 years. So, we’re really at the start of generational changes. So, what that future holds, we’re hoping: is more economic opportunity, protection of our natural resources and protection of our people, and trying to create a healthy environment and a health economy and really trying to pursue this in a sustainable fashion going forward.” “It’s going to create many, many opportunities …and we want to be part of that,” LaBar said, “But we also want to preserve Wayne County. We want to be sure that Wayne County stays the beautiful place that it is.”

Pa. developer buys up Mansfield Business Park. Elmira Star-Gazette. “Plans to tap into Marcellus shale commerce … With an eye toward job and business growth spurred by the natural gas drilling into Pennsylvania’s Marcellus shale formation, the J. Grace Co. of Chadds Ford, Pa., will purchase the 61 acres remaining in Mansfield’s Interstate-99 Business Park. The business park is located near U.S. Route 6 and state Route 15 (future I-99), a mile west of Mansfield. It has been subdivided into 24 parcels, one of which is being developed by the Microtel Inns & Suites motel chain of South Dakota. … “We both feel Marcellus shale opportunities are the tip of the iceberg and there will be a lot of job growth. That’s one of the major reasons he’s purchasing the property.” … “People don’t realize how huge the Marcellus shale project is,” Grace said in a prepared statement. “It’s going to have a major impact on the growth and development of the area. I have great expectations and great hope for the Mansfield area.”

I-99 Business Park to be sold to developer. Williamsport Sun-Gazette. “Businesses being sought are those related to the current Marcellus Shale development, as well as restaurants, motels and other businesses that would fit within the guidelines of the park. The company will begin by developing three sites, Freeman said. Grace said he has “great expectations and great hope for the Mansfield area.” … “He is really high on the Marcellus Shale opportunities,” he added. Freeman said he thinks “we are going to see the whole gamut from white collar workers in office space to repair facilities” related to the natural gas industry. “I don’t know specific entities, but we know it is going to be big and it is coming at us,” he said.”

Energy In Depth: Today’s News

Technology improving productivity, costs of shale gas developments. The Canadian Press. “It was in the shale of north-central Texas around the beginning of this decade that huge technological leaps ushered in a new era for North America’s natural gas industry. The Barnett Shale was the testing ground for many of the techniques firms are using today to tap into bountiful, but tough-to-access, natural gas reservoirs throughout the continent. Now producers are working on tailoring the technology to adjust to the particular nuances that come with other emerging areas, like the Horn River Basin in northeastern British Columbia or the Marcellus in Pennsylvania. “We’re at a quantum change in terms of natural gas exploration and development within North America,” said Mike Dawson, executive director of the Canadian Society for Unconventional Gas. … Another technology that has helped unlock unconventional gas plays is multi-stage fracturing, in which water, sand and chemicals are injected into the ground at high-pressure to essentially break the rock and free the gas. The “multi-stage” element means gas can flow out along the whole length of the well bore, as opposed to from just one spot. The technology has been improving continually over the years.”

Marcellus Shale brings big checks for some landowners. Patriot-News. “Hundreds of people from far-flung farms and rural communities across a large swath of northern Pennsylvania trekked to an American Legion post this weekend to have checks — often for large, life-changing amounts of money — pressed into their hands. It went on throughout the day yesterday and continued this morning. Some people cried with happiness. “There were a lot of checks that were well over $100,000,” said Chip Lines-Burgess, who is attending the event. “It is a lot of money for people up here. It is a lot of money for people anywhere.” The source of the money is some 6,000 feet below the ground in a layer of rock called Marcellus Shale. The rock contains huge amounts of natural gas. The checks came from a gas company that is buying gas drilling rights from locals. The biggest land owners will get millions of dollars up front, with more to follow if wells drilled on their land produce gas. … “God has put the Marcellus Shale underneath our property,” said Lines-Burgess, a spokeswoman for the group. “We are about the luckiest people in the whole world right now.”

Rising natural gas prices could spur Marcellus shale drilling in Pennsylvania. Beaver County Times. “Drilling in the natural gas-rich Marcellus shale formation that stretches across western Pennsylvania has been stunted by the recession, but a Pittsburgh oil and gas expert believes change is coming in 2010. Duquesne University Professor Kent Moors, an internationally recognized authority in oil and gas policy and finance issues, predicted that the price of natural gas is on the verge of increasing to a point at which it will become profitable for companies to begin drilling. And if Moors is correct that the price could nearly double by the middle of 2010, Pennsylvania is in store for a whole lot of drilling. The Marcellus shale bed is a geological formation running from Kentucky to New York and across most of Pennsylvania. Industry experts believe it contains more than $1 trillion worth of natural gas.”

NY Moves Closer to Natural Gas Drilling Upstate. WNYC-TV. “New York State will move a step closer this week to opening up the Catskills and the Southern Tier to natural gas drilling, as a key environmental assessment is made public. … Property owners, energy companies, and environmentalists have been waiting more than a year to learn the state’s view of the procedure known as hydraulic fracturing. It’s a technique that uses vast quantities of water to get natural gas out of rock. In the next few days, the Department of Environmental Conservation says it will release an environmental impact statement on what measures are needed to do hydraulic fracturing safely.”

New rivals cast doubt on Alberta’s gas riches. Globe and Mail. “The extraordinary changes in the business of natural gas have raised new concerns about the viability of an industry that has long sustained Alberta. … The discovery of huge new unconventional gas supplies, such as shale gas in Texas and north-eastern British Columbia, has suddenly introduced a massive new supply to the continent. Combine that with a technological revolution that has allowed firms to profitably extract shale gas at $4 to $5 per thousand cubic feet, compared with $7 or $8 for new Canadian conventional supplies, and Alberta gas may find itself simply priced out of the market.”

Marcellus Shale Business Breakfast Seminars set. Wayne Independent. “As development of Marcellus Shale Natural Gas grows in Pennsylvania, business people statewide are being invited to a series of breakfast seminars to learn how it may create opportunities for their businesses.  Energy firms are flocking to the Commonwealth to extract natural gas from Marcellus, and are creating significant business opportunities for local businesses and entrepreneurs. Workforce Wayne, Wayne County Chamber of Commerce, WEDCO and Penn State Extension are hosting “Your Business & Marcellus Shale,” an educational program at the Wayne County Park Street Complex, 648 Park Street, Honesdale.   This will help entrepreneurs and established small-to-medium sized businesses understand and respond to Marcellus Shale related business opportunities.”

Natural gas industry demanding a bigger energy spotlight. Fort Worth Business Press. “Natural gas is getting organized. Or rather, the independent natural gas exploration and production companies that took shale gas from impossible to possible during the past decade increasingly are getting together to push the fuel’s appeal to new markets. America’s Natural Gas Alliance is the latest example of the companies’ cooperation. Formed earlier this year, ANGA was created by 28 of the nation’s independent natural gas exploration and production companies that produce about 9 trillion cubic feet of gas per year and comprise more than 40 percent of total U.S. gas supply, according to the group’s Web site.”

Energy In Depth: Today’s News

Energy answers lie in shale beds. Clovis News Journal, Op-Ed. “Thanks to a drilling technology known as hydraulic fracturing, it’s now possible to recover immense quantities of natural gas safely and efficiently from shale beds across Appalachia, the Great Plains and northern Louisiana, Texas and New Mexico. Together they hold an estimated 850 trillion cubic feet of natural gas, enough to meet America’s needs for decades. … But some members of Congress are less than thrilled with the prospect of a big shift to natural gas. Claiming that drinking water systems are at risk from chemicals used in hydraulic fracturing, they have proposed legislation to transfer regulation of the process from state governments to the U.S. Environmental Protection Agency. … State governments do a commendable job in regulating hydraulic fracturing, and there’s no reason why they won’t continue to do so. … It’s possible that EPA might ban hydraulic fracturing altogether. In that event, natural gas production in the United States would drop 45 percent within five years, according to an industry study, and thousands of jobs would be lost. … Hydraulic fracturing is safe and reliable. We owe our bountiful supplies of natural gas to it.”

Dormant pipe plant in Bossier City to reopen. Shreveport Times. “Joined by local elected officials and company executives, Louisiana Gov. Bobby Jindal welcomed the reopening of the Bossier City location of Northwest Pipe Co.as a signal of good health for the Shreveport-Bossier City area economy. “What this shows is we can compete with any state in the country,” the governor said Thursday after touring a revitalized manufacturing line at the 187,000-square-foot facility on 25 acres north of Interstate 20 and just east of Hamilton Road in Bossier City. … The promise of exploring the Haynesville Shale formation and a market for the miles of pipe needed for such drilling were key in revitalizing the plant, he added. “This facility will be about natural gas exploration. We’re bullish on that, and we’re bullish on Bossier City. Despite the difficult economic times, we are excited at Northwest Pipe about this project,” he said. “It is an investment in gas exploration infrastructure. … Natural gas is going to be with us for a long time, and we expect to be an important player in that business.”

Geology professionals to meet here Sunday through Tuesday. Shreveport Times. “The 59th annual joint convention of the Gulf Coast Association of Geological Societies and the Gulf Coast Section of the Society for Sedimentary Geology will be held Sunday through Tuesday at the Shreveport Convention Center. While most of the convention is geared toward geology professionals, it will feature a symposium on the Haynesville Shale natural gas formation in northwest Louisiana that might be of interest to people outside that field.”

Energy In Depth: Today’s News

Committee provides update on gas drilling. Williamsport Sun-Gazette. “The development of natural gas resources in the Marcellus Shale is “a once-in-100-year opportunity” that will exceed – on an economic level – previous resource booms, such as the lumber industry, economist John C. Felmy said Wednesday. “This town was built on a boom. This is an opportunity that could be every bit as big, but it could last for decades instead of a short time,” Felmy, a chief economist with the American Petroleum Institute, said during a community meeting hosted by the Marcellus Shale Committee at Pennsylvania College of Technology’s Klump Auditorium. About 200 people attended the meeting, which was held to update local residents about activity in the Marcellus Shale, according to Louis D’Amico, executive director of the Independent Oil and Gas Association. … D’Amico added that any time an area has a commodity in abundance, it attracts other industries that need that commodity to the area, thus creating additional jobs. The industry could create up to 174,000 jobs by the year 2020, he said.”

Natural-gas climate. Grand Junction Sentinel, Editorial. “The Waxman-Markey bill would enact a massive, de facto tax on energy — costing households at least $1,500 per year, according to the Congressional Budget Office. It would further cripple an economy that is now just limping along. Because there are so many loopholes for certain preferred CO2 emitters, the bill would actually do very little to curb carbon emissions. That’s why some major environmental groups oppose it. The Senate should kill the Waxman-Markey bill. But that doesn’t mean this country should do nothing about carbon emissions. One thing it can do relatively cheaply is encourage more use of natural gas. Although natural gas received little mention at the U.N. Tuesday, new technology has dramatically increased the amount of gas available in the past few years. Because it burns cleaner than coal or gasoline, some environmentalists are beginning to take notice and are arguing for greater utilization of natural gas. … Natural gas is a transitional fuel that can help as we develop better long-term technologies. If President Obama and other world leaders are serious about reducing CO2 emissions quickly, they ought to step on the gas.”

Pickett raises concerns about gas leases in state budget agreement. Towanda Daily Review. “Citing the need to ensure that local governments and conservation districts are not left out of a plan she has co-sponsored called “Energize PA,” Rep. Tina Pickett (R-Bradford/Sullivan/Susquehanna) said Wednesday she needs more details about the state budget agreement before she can decide if it is the best deal for the people of her district and across Pennsylvania. Pickett is specifically referring to legislation she co-authored with Rep. Dave Reed (R-Indiana) this spring that would allow state forest lands to be leased to natural gas drilling companies for the purpose of extracting gas from the Marcellus Shale formation. Their legislation would divide the revenues among the state, local governments and conservation districts. In addition, the plan would produce thousands of local jobs, through both direct drilling operations and supplementary businesses and services.”

Energy In Depth: Today’s News

Economic Impacts of Drilling In Broome. WBNG-TV. “Broome County could see a boom in business if natural gas commences in the Southern Tier. An Economic professor from the University of North Texas formally presented a preliminary study Tuesday night to the County Legislature. The study finds that gas drilling would generate hundreds of new jobs, but did not study how drilling will effect the area environmentally. Researcher Bernard Weinstein believes millions of dollars in tax revenue make up for any environmental costs that could be looming down the road. “Having worked at lot of gas companies who are drilling in Oklahoma and Texas that the environmental footprint is fairly small. If you look at the history of the Barnett Shale in Northern Texas, in the last 15 years there’s been very little of what one might call environmental disruption, accidents, excess wear and tear,” said Weinstein.”

Gas Study: Big Bucks for Binghamton. FOX 40 News WICZ-TV. “Natural gas drilling can transform the economy. … That’s what Bernard Weinstein told the Broome County legislature Tuesday evening. “I’m not a geologist, I’m not a petroleum engineer, I’m not a geophysicist.  I’m an economist,” Weinstein said. And Broome County tapped him to conduct a three-month study on how Marcellus Shale drilling would financially impact the Southern Tier. “We have done our due diligence on the environmental side, we have made recommendations to the DEC, we have talked to our federal representatives.  We just believe if it’s done properly, done right, it could have a tremendous economic impact on our region,” Deputy County Executive Darcy Fauci said. … Weinstein compares the Southern Tier to Northern Texas — where the Barnett Formation has brought in more than six million dollars. “Binghamton and Broome County are sitting right on top of the Marcellus Shale.  That’s about five times the size of the Barnett,” Weinstein said. And if Greater Binghamton maximizes drilling — Weinstein says that would mean 10 to 15 billion dollars for Broome over 10 years.”

Gas well drilling technique pays off. Buffalo News. “National Fuel Gas Co. hit pay dirt with its first wholly owned horizontal natural gas well in the Marcellus Shale region in northwestern Pennsylvania. The Amherst-based energy company said the test results for the first horizontal well drilled by its Seneca Resources subsidiary in the Marcellus Shale produced an average of nearly 6 million cubic feet of natural gas per day. That’s two to three times the average yields National Fuel executives expect from the potentially high-producing wells in the region. “It’s obviously good news,” said Julie Coppola Cox, a National Fuel spokeswoman. “It’s a strong well and these are good results.” National Fuel executives, and officials from other energy companies, are investing heavily in the Marcellus Shale region in Pennsylvania and portions of the Southern Tier in New York in hopes of tapping into vast amounts of natural gas by using relatively new horizontal drilling technology.”

Energy sector plays key role in Pittsburgh economy. Pittsburgh Business Times. ““The energy sector can be a driving force much like education and health care has been,” he told an audience of about 400 at the Business Times’ first Energy Inc. event this afternoon. Reed joined fellow speakers DEP Secretary John Hanger; Ray Walker Jr., vice president for the Marcellus Shale division at Range Resources LLC, and Mitchell Singer, a spokesman for the Nuclear Energy Institute in Washington, D.C., in discussing the energy mix of this the region. As Walker pushed for state and federal subsidies for natural gas as a car fuel, he highlighted the vast supply of natural gas beneath his feet in the Marcellus Shale formation. Walker also said Pennsylvania has “the most extensive and comprehensive regulatory program in the U.S.” for natural gas development.”

Who’s Looking At Natural Gas Now? Big Oil. NPR. “In the energy world, Big Oil has long been the key player — with one notable exception: The natural gas business in the United States is dominated by small, independent companies. More than 80 percent of U.S. natural gas supplies are produced by companies with a market capitalization of less than $500 million. On average, these companies have only a dozen employees. But their business is booming. New production techniques in recent years have enabled companies to extract natural gas from shale rock formations deep underground. As a result, estimates of accessible natural gas reserves have been revised dramatically upward. Small gas producers can justifiably take the credit for the transformation of their industry.”

Canadian gas-field services firm arrives in Pa. Associated Press. “A Canadian maker of wellhead equipment is operating its first facility in Pennsylvania as more field service companies join the Marcellus Shale natural gas rush. Stream-Flo Industries Ltd. of Edmonton, Alberta, recently opened the facility in Indiana, Pa., complete with sales, service, engineering and design personnel on site. Stream-Flo’s manager of distribution and service centers, Joe Guarino, says three Stream-Flo staff have been transferred to Indiana while the company expects to add local hires. The facility is designed to serve clients throughout the Marcellus Shale field, which extends into New York and West Virginia.”

Energy In Depth: Today’s News

Shale gas crucial to nation. Montgomery Advertiser, Op-Ed. “The dramatic increase in U.S. production of natural gas would not have been possible without a precise and reliable technology for drilling through thick shale. Known as hydraulic fracturing, it has taken on increasing importance as an effective but little-known weapon in the battle against atmospheric pollution and dependence on foreign fuels. Yet though it is largely unknown to us, we benefit from hydraulic fracturing at dozens of points in our daily lives. Thanks to this technology, plastics and other materials made from natural gas are used in scores of consumer products. Our industries rely on the availability of natural gas, and it’s needed for heating and electricity production. In addition, our future fortunes look likely to become ever more closely linked with those of hydraulic fracturing, a process in which water and other materials are pumped at high pressure to break through underground rock formations and reach beds of natural gas.”

Rediscovering Natural Gas By Hitting Rock Bottom. NPR. “But the natural gas folks now have numbers on their side due to new successes in getting gas out of shale rock. Geologists have always known that shale rock, often found in combination with coal and oil deposits, holds substantial amounts of natural gas. If a piece of shale rock is broken and lit with a match, it will actually burn for a few moments with a small flame. The shale gas was previously considered unreachable, but advances in drilling techniques have changed that assessment. The result is a dramatic increase in estimated natural gas reserves. The Potential Gas Committee, loosely affiliated with the Colorado School of Mines, reported in June that natural gas reserves in the United States are actually 35 percent higher than believed just two years ago, and some geologists say even that estimate is too conservative. … Horizontal drilling and water fracturing are not new techniques in the oil and gas business, but only in recent years have producers used the procedures in combination to produce shale gas, and the results have been dramatic. “It’s the biggest thing I’ve ever even heard of,” says Ray Walker, vice president of Range Resources, a gas exploration and production company. “It’s huge. The ability to produce these shale reservoirs is going to revolutionize this industry all over the world.”

Natural Gas: Conventional Drilling Areas And Shale Basins. NRP. “For many years, natural gas companies have been producing the fuel from “conventional” gas reservoirs, relatively close to the surface and easily accessible. New shale gas production techniques have opened much wider areas for exploration, including the Marcellus area in Pennsylvania and the Barnett and Haynesville areas in Texas.”

Mapping the path for natural gas. Calgary Herald. “The billion dollar question for 2010 is whether or not unconventional gas production in now-legendary plays like the Barnett, Haynesville, Fayetteville, Woodford, Marcellus and even Canada’s Montney, to name a few, will be able to collectively respond fast enough to offset estimated conventional declines in 2010 of 5.0 Bcf/d in the US, plus another 1.0 Bcf/d in Canada. Theoretically it’s possible, but nobody likes to talk theory at a party. Indeed, there are many practical constraints to boosting near term production including thin cash flows, stretched balance sheets, impatient bankers, tightened service industry capacity, and the strained logistics of mobilizing oilfield equipment once the price signals are convincing enough for E&P companies to spend money again.”

Quicksilver Resources excited about a big well in Canada. Fort Worth Star Telegram. “The company has a substantial stake at Horn River, having acquired 127,000 net contiguous acres of leases from the Canadian government in the winter of 2007-08. Quicksilver is confident of its ability to do well at Horn River, in part because it is a shale gas play with similarities to the Barnett Shale of North Texas, where technological advances in horizontal drilling and hydraulic fracturing have made it a hotbed of drilling activity in recent years. Quicksilver has considerable drilling experience in the Barnett, which company officials hope to translate to success at Horn River. “As we proceed with development of this project,” Darden said, “we anticipate drilling longer laterals with additional stages of fracture stimulation which we expect will result in even greater production volumes per well. It is becoming clear from mapping, core analysis and production results that our substantial acreage position is in a very good part of the basin and contains the potential for multiple trillion cubic feet of recoverable natural gas resources for Quicksilver.”

Barnett Shale helps launch women’s networking group. Fort Worth Business Press. “The oil and gas industry has its good ol’ boy network, but watch out: the girls are coming up from behind. Spurred in part by the attention the Barnett Shale brought North Texas, a group of Dallas-Fort Worth women recently launched a local chapter of the Women’s Energy Network, a 15-year-old group dedicated to providing women in the energy industry a forum to network with other like-minded attorneys, geologists, executives and more. “We know that women are starving for this,” said Ann Vandenberg, public relations co-chair for the fledgling group. She added, “I think that’s one of the reasons we got together: We felt that women who had stayed in the industry and have risen up through the ranks deserved a forum of their own. It can be isolated (and) difficult to meet other women in the field.”

Oilfield supplier expands to Indiana County. Indiana Gazette. “When tapping into the Marcellus shale formation and its possibilities for production, drillers go deep and product manufacturers go to the top … of the wells, that is. The latest to do so locally is Stream-Flo USA, a supplier of oilfield and gas well products and services, headquartered in Texas. The company recently opened a 6,000-square-foot facility along Wayne Avenue for the sales and service of oilfield wellhead and gate valve products. Company officials point to the Marcellus shale formation – a pocket of natural gas that stretches under western Pennsylvania, including Indiana County, southern New York, West Virginia and eastern Ohio – and Indiana’s location in relation to those areas, for expansion here. “The Marcellus trend and some other activity in the state is a very exciting development in our business and actually opens up a lot of new opportunities for a lot different companies,” said Joe Guarino, manager of distribution and service centers at Stream-Flo.”

Norwegian, US natural gas companies emerge as partners in Wayne. Wayne Independent. “A joint investment venture between U.S. natural gas producer Chesapeake Energy Corp. and Europe’s second largest natural gas supplier, StatoilHydro, is coming to fruition in Wayne County. The companies announced last November that StatoilHydro would invest $3.375 billion into Chesapeake Energy’s Marcellus Shale operations, in exchange for a 32.5 percent ownership interest in some of the leases in that area. A Wayne Independent review of natural gas leases – a legal document giving a company the right to explore and drill for natural gas on private property – found that the companies are fulfilling that plan here, according to county records.”

Energy In Depth: Today’s News

There is a natural gas gold mine under our feet. Washington Examiner, Congressman Glenn Thompson. “The safe and well-regulated process involved in producing and delivering natural gas from the Marcellus has already paid dividends to our region and commonwealth. According to a recent Penn State study, Marcellus Shale natural gas drilling last year generated 29,000 jobs, added $2.3 billion to the economy and generated $240 million in state and local taxes. For 2009 the estimates are 48,000 jobs, $400 million in tax revenues and economic output will top $3.8 billion. But that process – an energy technology known as hydraulic fracturing – finds itself under withering attack today. Not because it’s dangerous, or untested, or ineffective. No, it’s being targeted for elimination today because it’s considered too effective.”

Expert predicts prosperous Pa. future with natural gas. Washington Observer Reporter. “An author of a study on the economic impact of the Marcellus Shale region said Friday that Pennsylvania could become a gas exporting state and by the end of the next decade could be hosting a $13.5 billion industry that generates 175,000 new jobs across the state. But Dr. Robert Watson, professor emeritus of petroleum and natural gas engineering at Penn State, told members of the Washington County Chamber of Commerce that the industry, which invested $2.8 billion and created 29,000 jobs last year in Pennsylvania, faces a variety of physical, environmental, governmental and even psychological challenges. Watson, who co-authored the study with several others in the energy field, said the Marcellus Shale region, which stretches across two-thirds of Pennsylvania and occupies parts of four other states, has the potential of supplying most of the energy needs for the Northeast for the next 100 years.”

Gas drilling may start in ’10. Wilkes Barre Times-Leader. “WhitMar Exploration Co., the only gas-drilling company so far to have leased substantially in Luzerne County, plans to begin drilling by the middle or latter part of next year, according to the company’s president. “Right now, we’re just filing for some permits for two, possibly three wells we want to drill,” said Whit Marvin, who heads the Denver-based company. “We do plan on drilling it and testing it for the Marcellus Shale.” Throughout 2009, WhitMar has leased more than 22,000 acres in, among other places, Fairmount, Ross, Lake, Lehman, Union, Hunlock, Huntington and Dallas townships with little money upfront by offering landowners a contractual guarantee to begin drilling within two years.”

Endangered species on oil and gas companies’ Red River watch list. Shreveport Times. “Oil and gas companies that are pumping water from the Red River for hydraulic fracturing of Haynesville Shale natural gas wells now must add an extra step before federal agencies will sign off on their permits. Brought to the attention of the various companies in recent weeks by the U.S. Fish and Wildlife Service are three federally threatened and endangered species — a plant, bird and fish — that could be found along the massive waterway. Criteria has been put in place recently to help the operators identify the species and to make sure the water pumping process does not disturb or destroy the natural habitats of the earth fruit, pallid sturgeon and interior least tern.”

Businesses looking to profit from natural gas. Williamsport Sun-Gazette. “Offering diverse services, businesses attending the Central Susquehanna Oil & Gas Expo on Saturday were bonded by their curiosity in natural gas exploration. Expo committee Chairman Matt Henderson said 130 businesses registered. Representatives of these companies were observed behind tables at the Lycoming County Fairgrounds, talking with an estimated 1,000-plus visitors. “The goal of this expo is to help facilitate beneficial relationships between local businesses and the oil and gas industry, to provide local employment opportunities and to realize the economic benefit within the local market,” said Henderson, who is also a member of the Lock Haven University Small Business Development Center.”

Exploration firms join to find oil, gas in Miss. Jackson Clarion Ledger. “Two out-of-state companies have entered an agreement to jointly develop their combined 13,500 acres In Mississippi for oil and gas exploration. Nevada-based Mainland Resources will commit approximately 8,500 net acres and Houston-based American Exploration will commit approximately 5,000 net acres to the project. The property is contiguous. Mainland Resources will be the operator, committing to pay 80 percent of the initial well drilling and completion costs to earn a 51 percent working interest in the well and total project area. American will pay 20 percent to earn a 49 percent working interest in the well and total project area.”

Driller: Gas well talks at impasse. Denton Record Chronicle. “Talks to move proposed gas wells at the Rayzor Ranch development may have reached an impasse, an official with the drilling company said, making it more likely that the Denton City Council will be forced to vote on a controversial drilling site near homes and a city park. The City Council in July tabled a request by Fort Worth-based Range Production Co. to drill up to five gas wells across Bonnie Brae Street from McKenna Park in the southeast corner of Rayzor Ranch, a 410-acre mixed-use development planned for both sides of U.S. Highway 380 at Interstate 35. Council members said the delay would allow time for negotiations to move the wells farther from the park and homes.”

Marcellus Shale: A tale of two cities. Press & Sun-Bulletin. “This is a tale of two towns, and the riches beneath them. In Dimock, Pa., the contemporary log home of George Brown sits in a rural stretch of the Endless Mountains in the northeastern part of the state. On his porch, a pine plaque welcomes visitors: “May the peace of the wilderness be with you.” In Sanford, N.Y., in a similar expanse of dense woods interlaced with lush farmland in Broome County, the early 19th century farmhouse of Gail Andresen sits on a fieldstone foundation starting to give way in spots. Both places are part of communities being profoundly shaped by the prospect of the Marcellus Shale, a geological formation gaining fame as a world-class source of natural gas.”

Energy In Depth: Today’s News

Ithaca gears up for gas drilling. Ithaca Journal. “With Marcellus Shale gas drilling on the near horizon, the Town of Ithaca is the only Tompkins County municipality that has created an inventory of land resources that should be protected from drilling, town officials said Thursday. As the state Department of Environmental Conservation nears completion of its environmental impact statement on horizontal fracturing, some landowners look forward to revenues from gas drilling rights while others fear negative environmental impacts. The Tompkins County Council of Governments — a group of leaders of every municipality in the county — has recommended that municipalities compile lists of resources like prime agricultural lands, unique natural areas, and waterways. The idea is for municipalities to send their lists to the DEC and ask to become “involved agencies” when the DEC is considering specific gas drilling permits.”

Work force groups prepare for future gas drilling jobs. Washington Observer Reporter. “While not all of the graduates have found employment, Linda Bell, a member of the Southwest Corner Workforce Investment Board, told the authority that the Natural Gas Certified Operations Technician program offered at Western Area Career & Technology Center in Houston is an effort to train local people for emerging employment opportunities in the Marcellus Shale strata here. “We have local residents available to fill emerging jobs,” Bell said, explaining that the 160-hour certification course was designed after she and other work force officials met with representatives of local natural gas drilling companies to learn what types of training people would need to find jobs in the field.

Natural gas producers’ $80 million campaign to seek. Dallas Morning News. “Natural gas producers are planning a major lobbying effort to shape climate change legislation in the Senate, aiming for incentives to boost the use of their resource in power plants and vehicles.  The aggressive push is meant to make up for the gas lobby’s relative absence from climate-change negotiations in the House, where a bill that passed in June reserved most goodies for coal-burning utilities and manufacturers seeking incentives to shield them from the cost of reducing greenhouse gas emissions. “It’s only when legislation is introduced that changes it from a level playing field to an unlevel playing field that we say, ‘Wait a minute, you are rewarding those fuels that are less clean than natural gas,’ ” said Larry Nichols, chief executive of Oklahoma City-based Devon Energy. … The gas lobby’s new outfit, the America’s Natural Gas Alliance, plans an $80 million campaign to tout its aims with ads in national and regional publications. The group is united in opposition to new oil and gas taxes proposed by the Obama administration, as well as a House bill that would federally regulate hydraulic fracturing – the water-and-chemical-infused drilling method used to produce most gas in the U.S.”

Energy executives give natural gas a new push. Houston Chronicle. “Executives from some of the nation’s largest energy producers are lobbying Congress for changes to a House-passed climate change measure that they say overlooks the benefits of natural gas and gives an unfair advantage to coal. Under a new ad-hoc umbrella organization known as America’s Natural Gas Alliance, the business leaders are focused on making sure their industry doesn’t get ignored by senators assembling their own climate- change bill. … Producers use a process known as hydraulic fracturing to break up the shale rock and release natural gas. The technique, now regulated at the state level, has been criticized by some environmentalists who worry it could introduce harmful chemicals into water. “For the first time in our country’s history, and for the first time in the history of the natural gas industry, we have these formations that cover wide areas that we” can access, said Larry Nichols, the CEO of Devon Energy. “We now have abundant gas. It is throughout the United States and in lots of areas that natural gas has not really been in large quantities.”

Chesapeake Seeks Climate Bill Changes, More Gas Sales. Bloomberg. “Chesapeake Energy Corp. and other natural-gas producers, unhappy with climate-change legislation they say favors competing fuels such as coal, are teaming up to tout the benefits of their product to lawmakers in Washington. Chesapeake, Noble Energy Inc. and Apache Corp. are among 28 companies that in March formed America’s Natural Gas Alliance, a Washington-based group aimed at increasing “appreciation” for natural gas. Members of the alliance met with reporters today in Washington. The alliance has “one mission: to try and generate more natural gas demand,” Aubrey McClendon, chief executive officer of Oklahoma City-based Chesapeake, which operates the largest number of gas rigs in the U.S., said yesterday.

Freudenthal: Natural gas, coal industries will both lose if they target each other. Billings Gazette. “Gov. Dave Freudenthal told the natural-gas industry Thursday that depressed energy prices are going to drag down the state’s economy, and he’s particularly concerned about the increasing unemployment rate. That drives Medicaid costs and other social services, and is probably the biggest budget pain for Wyoming. He said the current economy is discouraging, and relief doesn’t appear to be just around the corner. But the strongest message he wanted to impress upon the natural-gas industry was this: Stop attacking coal. “There’s an emerging conflict between coal and gas, and the only one that’s going to win is the environmental groups. You’re both going to lose,” Freudenthal said.”

Energy In Depth: Today’s News

The newest high-tech business? Oil and gas. Globe and Mail. “New drilling and production technology has dramatically transformed North America’s natural gas industry by unlocking massive shale gas reservoirs. Now, those technological advances are being adopted more broadly in the oil and gas industry to reduce costs in mature or difficult-to-tap fields. Service companies have, over the past five years, made huge strides in so-called fracturing techniques, which are used to stimulate oil and gas production from the rock in which the hydrocarbons are trapped. Together with drilling advances, a variety of technologies have allowed producers to tap long-discovered gas reservoirs in shale rock, including the prolific Barnett, Haynesville and Fayetteville fields in the United States, and the Montney and Horn River plays in Canada.”

Garfield County continues to debate resolution on DeGette’s FRAC Act. Real Vail. “An expected showdown over support or rejection of the FRAC Act by one of Colorado’s most drilled counties fizzled a bit Monday when the Garfield County commissioners decided to delay any resolution on the federal hydraulic fracturing legislation until they see a movie on the topic and take more public input. Democratic county commissioner Trési Houpt, also a member of the Colorado Oil and Gas Conservation Commission, has shown support for the bill, sponsored in the U.S. House by Colorado Democrats Diana DeGette and Jared Polis. But Republican county commissioner John Martin has indicated he doesn’t think it’s necessary. Republican commissioner Mike Samson, the third and perhaps deciding member of the board, while saying he is not taking a position that would reinstate Safe Drinking Water Act rules for fracking, did invite community activists concerned that the process is contaminating drinking water to speak at Monday’s meeting.”

Gov’t says drilling policy caused BLM confusion. Associated Press. “The U.S. Bureau of Land Management frequently misinterpreted and violated a federal law that sought to expedite oil and gas drilling in the West, a Government Accountability Office report said Wednesday. The Energy Policy Act of 2005 laid out new circumstances in which detailed environmental review would no longer be required before oil and gas developers could drill new wells. The BLM approved such “categorical exclusions” in 28 percent of some 22,000 oil and gas permits issued between 2006 and 2008, according to the report out Wednesday. The purpose of the law is to save regulators time by allowing them to skip environmental impact statements and environmental assessments that otherwise would be required under the act.”

Low Natural Gas Prices Won’t Stop Marcellus Shale Drilling. State Journal. “Natural gas prices are in a terrible spot for producers. In the past couple of weeks, we’ve talked about historic lows in the price for that commodity. NG hasn’t been this cheap in more than seven years. And despite the pump fake move in the markets back over $3 last week, the trend is that there still is too much gas everywhere in the short term. Now, at some point, either the economy will go back to demanding more gas to work metals or make fertilizer or chemicals. Better still, we might have another monster winter when we have to spend up to heat our homes. No matter. The drilling goes on here in West Virginia and Pennsylvania in the Marcellus shale. And whether America needs the gas this winter or not, it’s going to continue.”

Energy In Depth: Today’s News

Lessons from gas drilling. Elmira Star-Gazette, Editorial. “Much like the emotional health care debate, anticipation of further natural gas drilling in this region has triggered questions about what’s next and when. … But as landowners protect their financial interests, there is the looming environmental concern over the horizontal hydro-fracturing that will be necessary to tap into the huge Marcellus Shale gas formation under New York. Pennsylvania already permits such drilling, but New York has been cautious in developing environmental safeguards over the controversial drilling technique. Those regulations, possibly out this month for public review, are sure to touch off further debate between those who stand to profit from drilling and those fearful it will ruin their environment. Both sides will need to be patient. It’s an approach that has worked so far. It’s one that can work again for all parties.”

Winter heating bills forecast to drop. The Durango Herald. “Rocco Canonica, director of energy analysis for Bentek Energy, a natural-gas research firm in Evergreen, said significant improvements in drilling technology in shale formations have led to the opening of large new deposits in Louisiana and Texas. In addition, Exxon Mobile Corp. announced in July it had found gas-shale formations in the Horn River Basin, in northern British Columbia, Canada, as productive as Louisiana’s Haynesville shale field and five times as large as Texas’ Barnett shale field. “A lot more shale gas has been found, and they’re finding more gas in deposits that dwarf conventional wells,” Canonica said. The finds and the improved drilling technology have dropped the price of natural-gas futures contract prices from a peak of $15.38 per million British thermal units Dec. 13, 2005, to a low of $2.51 on Sept. 3. As recently as July 3, 2008, the price for natural gas closed at $13.58 per million BTU.”

Marcellus regulations delayed. Press & Sun-Bulletin. “A much-anticipated draft of new regulations for drilling into the Marcellus Shale will not be released by Tuesday as expected, but DEC officials said it will come before the end of the month. The amended state regulations follow a review of the industry that began in the summer of 2007 to address concerns over drilling’s impact on water and the environment. The regulatory update must be complete before full-scale natural gas development can proceed in the Southern Tier. Originally, the review was expected by the beginning of summer. The time frame was extended in the face of persistent public concern over how the drilling, and a process called hydro-fracturing, will affect water supplies and the landscape.”

Expo to connect local businesses with gas industry. Williamsport Sun-Gazette. “The Central Susquehanna Business to Business Oil and Gas Expo, scheduled for 10 a.m. to 3 p.m. Saturday at the Lycoming County Fairgrounds, Hughesville, will help connect local businesses with gas companies that could use their services. According to organizers, the event is not an employment expo. Rather, it is a networking event for companies who want to do business in the Marcellus Shale. The opportunities for businesses to capitalize on gas development is vast, though local businesses that may not think they have anything to offer might be surprised at the scope of services needed by the gas industry, they said. “There are a wide range of companies that can be of service to the gas drilling industry. It doesn’t have to be something directly related to gas development,” Mary Wolf, a spokeswoman for Anadarko Petroleum, said.”

Energy In Depth: Today’s News

Study: Gas jobs to number 48,000 this year. Williamsport Sun-Gazette. “A study by Penn State University on the development of natural gas in the Marcellus Shale paints a bright future for the region both in terms of the economy and job creation. The gas industry pumped $3.8 billion into the state’s economy, generated more than 29,000 jobs and produced $240 million in state and local taxes in 2008, according to the study, titled “An Emerging Giant: Prospects and Economic Impacts of Developing Marcellus Shale Natural Gas Play.” Those numbers are expected to be $3.8 billion, $400 million in taxes and 48,000 jobs for 2009, it said.”

EPA’s study of gas drilling in Wyoming could impact local operations. Press & Sun-Bulletin. “Debate over the environmental consequences of natural gas drilling in Broome County is reaching across the country. The federal Environmental Protection Agency has found evidence of caustic chemicals associated with natural gas production in 11 private water supplies in the state of Wyoming. Those findings — featured on Web sites and list-servers of advocacy groups urging more oversight of the drilling industry locally and nationally — have intensified battle lines over controversial drilling regulations proposed by members of Congress representing communities in the Southern Tier and Colorado. Meanwhile, local and national proponents of the drilling industry are rallying to defeat the proposal, called the FRAC Act, sponsored by Reps. Maurice Hinchey, D-Hurley, and Diana DeGette, a Democrat from Colorado. … Davidson’s take on the FRAC Act debate: Regulations such as Hinchey’s could discourage drilling into the Marcellus and other formations and reduce production nationally by 10 percent to 20 percent.”

FRAC Act to be eyed at Garfield County Commissioners meeting. Glenwood Springs Post Independent. “Gas and oil drilling operations are expected to be in the bull’s eye at the Sept. 14 meeting of the Garfield County commissioners, when the topics will include a potentially explosive debate over a bill now before the U.S. Congress about the controversial gas-drilling procedure known as “hydraulic fracturing.” The board of county commissioners has been preparing to take a position relative to the proposed legislation, known as the DeGette bill after one of its sponsors, Colorado Rep. Diana DeGette (D-Denver), which seeks to force the oil and gas industry to reveal certain secrets about its techniques as a way of ensuring public safety in areas where extensive drilling occurs. According to one county staff member, county manager Ed Green recently directed her to seek the advice of an industry lobbyist concerning the language of a resolution to explain the county’s position.”

Shale’s benefits detailed. Marshall News Messenger. “Drilling in the Haynesville shale was discussed during Saturday’s meeting of the East Texas Mayor’s Association. Representatives of Chesapeake Energy Corporation – Kevin McCotter, director of corporate development, and Paul A. Pratt, manager of public affairs – spoke to the gathered mayors about the impact the Haynesville Shale, and the company’s endeavors in developing it, will have on the region. According to McCotter, Chesapeake is the most active driller in the United States of independent natural gas exploration and production companies. “We have 1,404 operated rigs and 53 non-operated rigs throughout all of our operational area,” McCotter said, noting a 99 percent success rate. … Another issue McCotter addressed was the amount of water used in the drilling process and the possibility of contamination. The company uses 100,000 barrels (4.2 million gallons) of water during the drilling process – 25 percent for drilling and flushing earth cuttings back to the surface and 75 percent for the fracturing process. During the fracturing process, a mixture that’s 99.5 percent sand and water with some “household chemicals” mixed in, mainly soap to lubricate the process, is forced down the well to break up the shale. To prevent the possibility of contamination, McCotter said they use five or more layers of protection to isolate the well bore from an aquifer: surface casing, cementing it to seal it, production casing, also cemented to seal it; and production tubing. In some cases, additional casing and cement might be installed. “It’s never been an issue for us. The chances are very, very slim for any type of contamination,” said McCotter. He noted the mud pits are used solely for fracturing water.”

Club 20 looks for middle ground on public-option health insurance. Grand Junction Sentinel. “The organization supported the exemption of hydraulic fracturing from the federal Safe Drinking Water Act. Also, Club 20 opposed federal measures to establish a cap-and-trade program for carbon-dioxide emissions. Such legislation could more than double the cost of electricity and lower household disposable income by as much as $1,800 a year, as well as threaten the region’s coal industry, the organization said. Gov. Bill Ritter is to deliver the keynote speech to the organization today. The meeting begins at 8 a.m. with a legislative update and is open to the public. Interested people may register at the main entrance of the convention center.”

Foundation alleges ‘rubber-stamping,’ challenges 2 gas-drilling permits. Williamsport Sun-Gazette. “Environmental group PennFutures and Chesapeake Bay Foundation officials recently called for state lawmakers to abandon plans to lease state land to gas drilling companies and instead raise money for the state by implementing a severance tax on gas removed anywhere in the state. At least two local lawmakers disagreed on both counts. “I’m still unconvinced for the need for a severance tax,” said state Rep. Garth Everett, R-Muncy. “Maybe (it can be implemented) in a few years when the industry is up and running and producing something.” Everett said he wants to see the industry gain a foothold in the state, then study the impacts the industry has on other types of taxes such as the corporate net income tax. State Sen. Eugene Yaw, R-Loyalsock, agreed.”

Fortuna Energy agrees to pay $165 million for gas rights; 600 members of coalition to receive $5,500 per acre, plus royalties. Elmira Star-Gazette. “A Horseheads-based company is willing to pay a collective $165 million for the rights to drill for natural gas in about 30,000 acres of the Marcellus Shale. Fortuna Energy Inc. has closed a deal with The Friendsville Group, a coalition of about 600 property owners, to lease all of the group’s acreage in Susquehanna and Bradford counties in Pennsylvania, as well as its land in Broome County, officials with the coalition said Saturday. Under the agreement, Fortuna Energy will pay all of the property owners in the coalition $5,500 an acre for a five-year lease on their property, with a company option to extend the lease for another three years. The company will also pay 20 percent royalties for producing wells.”

Pa. case will have impact on gas drilling. Associated Press. “Pennsylvania landowners who want a better deal from natural-gas companies hoping to drill through their properties into the potentially lucrative Marcellus Shale formation will get the ear of the state Supreme Court. Wednesday’s arguments before the justices are certain to be watched closely for their impact on one of Pennsylvania’s biggest economic opportunities and environmental challenges in decades. For exploration companies with offices from Calgary to Canonsburg, the decision could result in the havoc of renegotiating land leases across the state, possibly throwing the entire gas industry into chaos.”

Ohio state senator would support drilling at parks. Youngstown Vindicator. “The Republican head of the Ohio Senate said he would support legislative efforts to allow oil and gas drilling at state parks. Senate President Bill Harris, from Ashland, said he would like to see the issue addressed in a stand-alone bill this session. “Let’s get that passed and send it to the House and try to get it passed there,” Harris told Statehouse reporters this week. “I think that’s how it needs to be done. I think that way we can have hearings specifically on that. I think there’s support for it.” Asked whether he would support such a bill, Harris replied, “with appropriate controls and protection, yes.”

Technology spurs gas exploration in new places. Globe and Mail. “Spurred by high commodity prices and new technologies, junior energy companies are on a natural gas exploration hunt across Canada in search of overlooked reserves. Technological breakthroughs have made unconventional plays – the easy-to-find, but hard-to-develop resources that can hold vast reserves – far more economically viable. There have been big natural gas discoveries in British Columbia, Saskatchewan and even Quebec. And while companies have flocked to the hottest new development regions such as B.C.’s Montney shale gas field, there are many others now seeking to replicate that success in regions whose potential is little known. … “We feel we might as well be on the [shale] gas bandwagon,” said PetroWorth president Neal Mednick. “There are gas-charged structures throughout the East Coast … it’s the new frontier for oil and gas exploration in Canada.”

Marcellus Shale Website to Organize Counties. PRWeb Release. “A Marcellus Shale website has launched a campaign to organize Counties seeing Marcellus Shale exploration and production. GoMarcellusShale.com will now utilize special user groups devoted to discussing county activity in the Marcellus Shale. The county groups can be accessed at www.GoMarcellusShale.com.  Keith Mauck, Publisher of GMS, stressed now is the time to initiate such an organizing campaign in the Marcellus, “Because the Marcellus Shale is beginning to see increased leasing and production activity; now is the time to make sure that localities have a place to network and share local information.” Mauck added, “We want to ‘drill’ down into the local level and bring mineral owners, landowners and professionals into one vital network – we all have plenty to learn from each other.”

Expo aims to connect businesses. Williamsport Sun-Gazette. “Development of natural gas resources in the Marcellus Shale region will provide significant opportunities for a range of local businesses. The Central Susquehanna Business to Business Oil and Gas Expo, scheduled for 10 a.m. to 3 p.m. next Sunday at the Lycoming County Fairgrounds, Hughesville, will help connect those businesses with gas companies that could use their services. “This is not an employment expo,” said Mary B. Wolf, a spokesperson for event co-sponsor Anadarko Petroleum Corp. “This is a giant networking event for businesses who want to do business in the Marcellus Shale.”

Summit Midstream building new Barnett pipelines. Fort Worth Business Press. “Atlanta-based Summit Midstream Partners acquired some natural gas gathering assets in the Barnett Shale from a division of Chesapeake Energy Corp., which has been trying to sell off portions of its midstream infrastructure. Summit Midstream acquired 75 percent of DFW Midstream Services LLC from a subsidiary of Energy Future Holdings Corp., which owns 25 percent of DFW Midstream. DFW Midstream acquired the assets from Chesapeake Energy Marketing for an undisclosed price, according to a Sept. 9 press release from Energy Capital Partners, which formed Summit Midstream.”

Energy In Depth: Today’s News

Gas-drilling meeting draws 120. Oneonta Daily Star. “Jim Smith of Corning Place Consulting of Albany said the event for the industry group was organized so residents could hear the science-based facts about natural-gas exploration. “We believe there is a lot of misinformation. We have a long track record of safety,” he said. “We are here to hear your concerns.” IOGA executive director Brad Gill began with a half-hour presentation that included an animated video of the process of horizontal drilling and hydraulic fracturing that is proposed. It was followed by a question-and-answer session where several people spoke in support of the process but dozens voiced concerns. … One of those speaking in favor of drilling was Kimberly More of Goodyear Lake, who said that everyone in the room uses electricity and much of it is produced by coal in this country. She was in favor of natural-gas drilling, which she said produces a much cleaner burning fuel. She said she was upset with the protesters, saying they demeaned the job the DEC has done in protecting the environment.”

Sept. 10 – EnCana. Grand Junction Sentinel. “A story on page 3A Wednesday should have said the substance tentatively identified by the Environmental Protection Agency in three water wells in the area of EnCana Oil & Gas (USA) wells in Pavillion, Wyo., was 2-butoxyethanol phosphate, not 2-butoxyethanol, or 2-BE. EnCana says 2-butoxyethanol phosphate is not used in hydraulic fracturing of wells. The EPA says 2-BE, a foaming agent used in fracturing, could react with naturally occurring phosphates to create 2-BE phosphate. However, the agency has found no direct link between fracturing and water contamination.”

Natural gas, Valley Business Park operations booming. Morning Times. “For a group of elected and appointed public servants who have spent the last several years dealing with permits and proposals for a variety of natural gas drilling-related operations, a report from Central Bradford Progress Authority Executive Director Tony Ventello that the industry is booming throughout the area was met by little more than a small sea of nodding heads. “A lot of things are happening in and around the Valley Business Park,” said Ventello. “Because of all the gas activity in the region, there’s been a lot of interest there.” … Ventello noted that because most of the natural gas extracted in Bradford County is about 98 percent clean and there is a huge market for it, northeastern Pennsylvania is currently considered the best place to drill in the country. A recent study conducted by Pennsylvania College of Technology, which focused on job growth and stability in the area due to natural gas exploration, should bring only good news, Ventello said. “The only way to argue your case is with good data,” he said. Another somewhat surprising outcome of the gas boom has been an increased interest in reviving old railroad lines. “The railroads have gotten red hot recently,” Ventello said. “We’ve been overwhelmed with requests to develop them.” “Those lines have been underutilized as long as anyone can remember,” he added. … Supervisor Jack Walter was openly optimistic about the boom natural gas has provided both the township and the greater Twin Tiers region. “I think it’s going to be a good thing for this area,” he said.”

What Glut? Natural Gas Soars. Wall Street Journal. “Natural-gas futures soared 15% Thursday after U.S. inventory data slightly eased concerns about the possibility of a storage glut, prompting a flurry of bargain-buying ahead of the winter heating season. Natural gas for October delivery on the New York Mercantile Exchange settled 42.7 cents higher at $3.256 a million British thermal units, a one-month high. In percentage terms, this is the biggest rise in the front-month natural-gas contract in nearly five years. Futures fluctuated early in the trading day and climbed throughout the day following the release of storage data by the Energy Department.”

Energy In Depth: Today’s News

Schlumberger opponents, supporters speak out at public hearing. Elmira Star-Gazette. “Citing environmental concerns, numerous people spoke out against a proposed Schlumberger Technology Corp. project in Horseheads during a public hearing Wednesday evening. But several other people who turned out at the Horseheads High School auditorium spoke in favor of the project, pointing out economic benefits. Schlumberger wants to build a $30 million natural gas exploration services facility on about 90 acres it owns in The Center at Horseheads industrial park. There would be no drilling on the site, but the facility would support natural gas companies that drill in the area, and there would be chemicals and explosives stored on the property. Company officials estimate the project will create up to 400 jobs once the facility is fully operational, in addition to construction jobs.”

Texas firm considers drilling in Pittsburgh area. Associated Press. “A Texas company is contacting landowners who may own mineral rights in suburban Pittsburgh and planning a series of public meetings to determine whether to drill into Marcellus shale in the region. Georgetown, Texas-based J. Howard Bass & Associates has sent letters to property owners explaining the terms of its oil and gas leasing opportunities. Residents of Washington, a town about 30 miles southwest of Pittsburgh, estimate there are about 6,500 property owners in the city who could benefit from natural gas drilling in the shale formation that runs across chunks of the state.”

Energy In Depth: Today’s News

Gas drillers look to Washington. Washington Observer Reporter. “A Texas company will hold a series of public meetings next week with Washington property owners who may hold oil and gas mineral rights to determine whether gas well drilling could occur in the Marcellus Shale deposit within the city limits. According to a letter from J. Howard Bass & Associates Inc. of Georgetown, Texas, its land department is contacting property owners who may own mineral rights in the city’s eight wards to explain the terms of its oil and gas mineral leasing opportunities. One local property owner who plans to attend will be Mayor Sonny Spossey, who said he received two letters from the company.”

Crowd raises questions for ‘fracking’ pros. Times Herald-Record. “Gas drilling in New York is so safe, you can drink water from a well near a drilling site. Therefore, worries that the controversial horizontal drilling method called “fracking” will pollute Sullivan County’s ground and surface water are unfounded. So said the top representative of the industry that plans to drill for natural gas in one of the country’s richest formations, the Marcellus shale, which sits beneath Sullivan County. “We have no known fracking contamination in New York state (in thousands of wells),” said Brad Gill, executive director of the Independent Oil and Gas Association of New York, which, along with the Sullivan County Partnership for Economic Development, hosted a meeting Tuesday night for a crowd of 125 at Bernie’s Holiday Restaurant.”

Natural Gas Stocks: The Ultimate Form of Stored Solar Energy. Seeking Alpha, Op-Ed. “Like the wishers, hopers, and true believers of the solar religion, I, too, wish we could rely on collecting the sun’s rays and the wind (which the sun effectively creates) exclusively. We can’t. Get over it. Use The Force, Luke. Use the batteries. That brings me to the question, “Which of the giant batteries provides the highest mass energy while releasing the lowest hydrocarbon content as a by-product?” I conclude that it is natural gas. This is really fortunate for America since we have enough natural gas to last 300 million people for 100 years — while we are finding smarter ways to collect the diffuse rays of the sun and use them the same day or week received rather than having to wait a few million years to benefit from them as stored energy.”

‘Just do it’ is not the right approach to Pennsylvania budget crisis. Harrisburg Patriot-News, Op-Ed. “Left to its own devices, the General Assembly likely would have come to an agreement months ago. But, budgeting also involves the governor and Ed Rendell is willing to tax anything and everything to fund his spending desires. That is why he has proposed a wide array of tax increases ranging from the Personal Income Tax to sales taxes to implementing new taxes on the Marcellus shale reserve. Even Democrats would not go along with a PIT increase, and the governor has finally realized the folly of taxing the nascent development of Marcellus shale resources.”

Energy In Depth: Today’s News

Industry defends process used to recover oil and gas while Congress considers regulation. Associated Press. “Some states are investigating complaints associated with fracking, but this community in central Wyoming is the only place where the Environmental Protection Agency has opened its own investigation, according to agency officials. Here, Fenton and his neighbors formed their own advocacy group, Pavillion Area Concerned Citizens, and pleaded with the EPA and state environmental officials to test their water wells. … Legislation has been introduced in Congress that would place fracking under oversight of the Environmental Protection Agency. Industry is fighting the proposal as unwarranted and as a potential killer of both jobs and its ability to tap the nation’s abundant supplies of natural gas. “You’re familiar with the Jed Clampett well where you have a shotgun and you shoot it down there and the oil pops right out; they’re all gone,” said Chris Tucker, spokesman for Energy in Depth, an industry coalition formed to fight off federal regulation of fracking. “Now we produce much further down and have to use technology that is much more advanced.”

Sullivan economic group supports ‘fracking’. Times Herald-Record. “Let the drilling begin, says Sullivan County’s chief economic organization. The Sullivan County Partnership for Economic Development has endorsed the county’s newest – and most controversial – opportunity for revival, drilling for natural gas in the Marcellus shale, which sits beneath Sullivan. That endorsement comes with a condition many environmentalists say is impossible – that the development of one of the country’s richest natural gas deposits can preserve the county’s pristine fields, forests and waterways. The partnership just issued a policy statement that says it “believes strongly, that if government and industry can collaborate to properly protect and preserve our environment, the development of a natural gas industry in Sullivan County could create substantial fiscal benefits for our landowners and communities.” The endorsement comes prior to a Partnership-sponsored gas-drilling meeting Tuesday that will feature industry representatives who have stressed that gas exploration – with its horizontal drilling method of hydraulic fracturing of shale, or “fracking” – is safe. The event is open to the public.”

Surge in gas drilling amplifies debate over water treatment rules. Pittsburgh Tribune-Review. “The wastewater mainly comes from a drilling process called “fracking” — in which hydraulic fluid mixed with sand and chemical additives is pumped underground at high pressure to crack rock formations holding natural gas and oil reserves. The process creates water containing dissolved solids, toxic metals and organic pollutants. Brine water, trapped underground in the rock formations, flows back to the surface as well. … It is driven by surging activity in the Marcellus Shale region in Pennsylvania and portions of surrounding states, which is estimated to hold enough natural gas to meet the country’s needs for more than a decade. … Range Resource’s Pitzarella said the chemicals remain underground, while the brine water returns to the surface. The amount of chemicals used in the fracturing water amounts to about one-twentieth of one percent of the total amount of water, he said. “In 60 years, we (the drilling industry) have had zero confirmed reports of hydraulic fracturing (water) contaminating drinking water,” Pitzarella said.”

Why Natural Gas Should Not Play the Cap-and-Trade Game (the real enemy is mandated renewables/conservation, not coal). MasterResource.org, Robert Bradley. “Decision-makers in the gas production, transmission, and distribution businesses should reject this Trojan Horse. Obama energy policy spanks natural gas, the predominant swing fuel in electric generation, by forcing renewables and conservation (conservationism) in the market. And fair warning: the more natural gas gains in market share relative to oil and coal, the less friendly the environmentalist movement will be. (Take note of the hydraulic fracturing debate between environmentalists and the oil and gas production sector.)

Shale offers DuBois, Sandy opportunity. Leader Vindicator. “Contrary to a comment by DuBois Mayor John “Herm” Suplizio, that the city has been selling water for Marcellus Shale drilling in S.B. Elliott State Park, park Manager Beth Rosevear Grove said that while the operation is near the park, there is no drilling in the park. Sandy Township and the City of DuBois are looking for ways to benefit from the gas rush that has taken over the region – each in their own way. At the DuBois Area Chamber of Commerce’s Business Over Breakfast Thursday, DuBois Mayor and acting city Manager John “Herm” Suplizio said DuBois is “right smack dab in the middle of it” as far as Marcellus shale gas drilling is concerned. The city owns 5,000 acres of land near the reservoir that has been a twinkle in the eyes of gas companies for about two years. “We are of interest to these people, and we have been in talks about them drilling for gas on our property,” Suplizio said. “That’s a very nice income for the city of DuBois. It will keep the tax base down.”

Nautral gas: A victim of its own success. Fort Worth Business Press, Op-Ed. “Natural gas is a victim of its own success. And what a success story it has been. Venture back in time to 1954 when the U.S. Supreme Court ruled that natural gas that was transported and sold in interstate commerce was subject to federal price controls. So, from 1954 until 1978 all natural gas that was produced in Texas but sold across state line was subject to federal price controls. Natural gas produced in Texas and sold in Texas was intrastate gas and not subject to federal price restrictions. And, that’s why Texas had plenty of natural gas and other states had very little. … Just 30 years ago the “experts” were predicting the demise of natural gas. The industry responded to the free enterprise principal of “risk and reward” and developed new drilling techniques to produce the natural gas in very difficult conditions, such as the Barnett Shale in Texas, the Haynesville Shale in Louisiana, and the Marcellus Shale in Pennsylvania and New York and West Virginia.”

‘Oil’ men migrate north seeking Marcellus riches. Elmira Star-Gazette. “The Marcellus Shale may be one of the largest natural gas resources in the world, but to Kent Fullerton, it’s an oil patch. The 45-year-old Houston native has been in the drilling business almost his entire life. Now a salesman for Wellhead Distributors International, he is among seasoned industry tradesmen from places like Texas and West Virginia who have headed to the Northeast in search of Marcellus riches. This week, it’s taken him to a trade show in Erie. Next stop may be Broome County. Things are different up here. Technical and regulatory issues abound. Cultural and operational differences have to be bridged.”

Energy In Depth: Today’s News

Residents Talk One-On-One With Schlumberger Reps. WENY-TV. “Schlumberger officials say they realize some Horseheads residents have questions and concerns about the proposed facility at The Center at Horseheads, so Thursday night, they let the public come right up to them and speak their minds. Representatives from the natural gas exploration company, and the project’s engineers, were on hand at an open house at the Holiday Inn Express in Horseheads. Different tables were set up where people could ask questions about the building’s design, traffic flow, safety, and hydraulic fracturing. “So many people have been concerned about bad effects that could happen.  And they’re not going to know unless they come out here and find out themselves,” said Maria Yates, who visited the open house.”

Schlumberger holds open house. Elmira Star-Gazette. “Schlumberger representatives held an open house at the Horseheads Holiday Inn Express in a move that company officials say goes above and beyond their normal community relations efforts. Residents have turned out in force every time village officials have reviewed the project, which is expected to create 400 jobs, but also has raised environmental concerns. Schlumberger plans to build a natural gas drilling service facility on about 90 acres it purchased in The Center at Horseheads industrial park. There will be no drilling at the site itself, but the company will provide support services to other gas exploration firms that do drill in the area.”

Get ready for cheap natural gas this winter. The Plain Dealer. “Gas storage levels for the winter are at historically high levels, breaking records every week. Already there is more gas in storage than at the start of some past winters. The new technology — horizontal drilling into ancient shale beds and then fracturing the rock with a mixture of pressurized water, sand and chemicals — has unlocked what experts describe as “an ocean” of new gas.”

Shale gas scepticism, and shale gas enthusiasm. Financial Times. “All those upward revisions to natural gas reserves aren’t convincing everyone. Matt Simmons, author of Twilight in the Desert, is deeply sceptical. The Houston Chronicle reported a few quotes from him earlier this week: Simmons simply doesn’t believe all the gas is there that many believe and that the process of getting at it – the water-intensive hydraulic fracturing method – is a huge waste of otherwise drinkable water. A report linking contaminated drinking water to the process could be troubling for the procedure, he says.”

Riches for the state: Marcellus shale must be handled properly. Patriot-News, Editorial. “The difficult news is that Pennsylvania doesn’t seem to have a real plan for taking advantage of this incredibly valuable luck of geology, and we need to make sure we have a good one for dealing with the negative environmental impacts that can result from getting this natural gas out of the ground. The process involves forcing more than a million gallons of water, sand and chemicals at high pressure into the shale causing it to crack, releasing the natural gas up a well. This water-intensive, horizontal drilling known as fracking needs particularly close attention.”

Energy Leaders Discuss Cap And Trade Issues. The Morning News. “Boling said a recent Supreme Court ruling allows the EPA to control emissions. That, Boling said, would be an administrative nightmare. “The EPA has 16,000 permits now,” Boling said. “Under new provisions that would jump to an estimated 550,000. How is the EPA going to handle that?” However, Deming called Waxman-Markley a, “badly flawed stab at controlling carbon emissions.” “China has said they’re not going to abide by emission controls,” Deming said. “Third-world countries aren’t going to abide by controls. The carbon is going to be emitted anyway, it’s just not going to be emitted here.”

Energy In Depth: Today’s News

Safe drilling a goal. Ithaca Journal, Brad Gill. “We agree and fully support the state Department of Environmental Conservation as it performs an extensive review of the possible environmental impacts that increased exploration would have on New York. Currently, the state has perhaps the most stringent environmental laws in the nation – much stricter than other states. These regulations will likely be tougher when the DEC completes its comprehensive environmental review. However, there is one basic premise that we greatly differ on with Phelps: We can explore for natural gas safely while protecting the environment. New York’s oil and gas producers have operated in a safe and environmentally sound way for decades. There are more than 13,000 active wells around our state – something many New Yorker’s may not know simply because these wells have in fact operated very safely.”

Will an over-extended government agenda save the industry from prohibitive legislation? Oil & Gas Financial Journal. “While producers of oil and natural gas continue to be a target of the Obama administration’s agenda, the IPAA is ready to fight the battle, said Joel Noyes, IPAA’s Director of Government Relations. Noyes was one of numerous panelists at Wednesday’s Summer NAPE Forum in Houston. Some of the outstanding issues facing the industry are cap and trade, hydraulic fracturing, energy taxes, and hedging and commodities markets. Fighting to ensure the voices of the industry are heard in Washington is the main objective of the IPAA. How will the association effectively lobby against so many potentially negative bills simultaneously?”

Pennsylvania’s Play for Marcellus. The (WV) State Journal, Op-Ed. “Everyone who pays attention to the natural gas industry has heard about the Marcellus shale and the great promise it holds as a domestic energy source. While many see it as an alternative to foreign energy, the gas-rich Marcellus shale also presents potential benefits for Appalachian states eager to realize new tax revenues and employment for their citizens. One recent industry analysis says the gas industry is just getting started in developing the Marcellus shale, transitioning from testing wells to preparing for large-scale production. … Pennsylvania gas interests want to be ready. They want as much of the Marcellus action as they can get, and they are trying to educate Pennsylvanians about the economic benefits the Marcellus holds while reinforcing Keystone State policies that encourage development.”

Ritter is right: Natural gas is a valuable venture. Denver Post, Editorial. “Gov. Bill Ritter has become increasingly vocal in recent months about his belief that natural gas is a key part of the state’s energy future.It is, of course, politically expedient for the governor to express support for an industry that’s important to the state, and especially the Western Slope where two of his potential opponents in the 2010 governor’s race hail from. But it’s also a pragmatic assessment of the need for cleaner-burning fuels that will support our energy needs in a way that solar, wind and other renewables cannot and likely won’t for decades. The most recent expression of the governor’s position came Monday at a Grand Junction conference of business leaders. Don Marostica, the governor’s new economic development director, said natural gas will be “where the Western Slope is going to sing” as part of the new energy economy, according to an account in the Grand Junction Sentinel. … A more robust market is good for producers and for the state, which derives revenues from oil and gas severance taxes. It has been good to see the governor’s administration come out with both a strong regulatory framework for energy exploration and support for the industry. The key will be extracting more gas within those guidelines. If done properly, it will serve Colorado well for years to come.”

State official, DeSoto police jurors discuss shale activity. Shreveport Times. “With a chart and maps in hand, state Natural Resources Secretary Scott Angelle brought proof to DeSoto police jurors that the parish is in the “gut” of the Haynesville Shale natural gas development. Last year, DeSoto led a five-parish region that includes Bienville, Bossier, Caddo and Red River in the number of oil and natural gas wells permitted in the formation. DeSoto fell slightly behind Bossier in the amount of natural gas produced so far. And with 182 producing wells to date, DeSoto accounts for 55 of those. “The good Lord has smiled in a good way by putting a resource here, and you are the blessing of that good luck,” Angelle said, also referring to the $28.7 million in leasing bonus money the DeSoto Police Jury received last year.”

Energy in Depth: Today’s News

Libous frustrated with state over gas drilling. Morning Times. “State Sen. Tom Libous has found himself using one word a lot lately with regard to the lack of natural gas drilling taking place within the Marcellus Shale area of New York state — frustrating. “The Department of Environmental Conservation continues to drag its feet on releasing draft safety regulations for natural gas drilling,” he said. “Our environment is a tremendous resource and we should work hard to protect it.  But we should also use it to help us when we can do it safely.”

Oil industry marks 150 years since first well. AFP. “One hundred and fifty years ago this week in a small Pennsylvania town an indefatigable businessman struck oil, changing the world forever. Boring a pipe deep into the Titusville ground, Edwin Drake drew black crude to the surface, in a process that would be copied all over the world and mark the dawn of the Petroleum Age. … But some residents are looking forward, hoping that the recent expansion of natural gas drilling and production in shale beneath the Pennsylvania earth will spark a new energy boom. According to local US congressman Glenn Thompson: “This gas shale is the Drake’s well of the 21st century.”

Shreveporters question local oil and natural gas laws. Shreveport Times. “Jodee Bruyinckx, the Louisiana Oil and Gas Association’s director for activities in the northern part of the state, spoke up at the councilman’s asking. Haynesville Shale wells generally do not produce a lot of saltwater, she said. Saltwater is a byproduct of drilling and can contaminate potable water. Mike Strong, Shreveport’s director of operational services, said the city likely will be selling water to companies for natural gas production. They will pay the same rates as residential and other commercial customers.”

Energy in Depth: Today’s News

Marcellus shale ‘boom’ is taking off in Clarion County. Clarion News. “Horizontal Marcellus wells start out vertically, and descend as far as two miles to the Marcellus Shale beds, curving into a horizontal direction to extend along the shale bed. Once at the shale bed, as many as six horizontal boreholes can be developed in different directions to tap as much of the shale as possible. … Tapping this reserve is not easy; drillers use an intensive process known as hydrofracking to bring gas to the surface. And hydrofracking needs massive amounts of water – water mixed with special and secret recipes of chemicals and sand pumped under high pressure into the shale until it forces the gas up and out. Water comes back out of the well and must be treated to remove the fracking chemicals and the salts and metals it may have picked up underground.”

Uphill fight for natural gas. Ottawa Citizen. “Another favoured battle tactic used by threatened incumbents is to lay policy land mines and road blocks against the attacker. Subtle and effective, this tactic is one that the natural gas industry must watch out for the most. For example, in the United States there is looming legislation against hydraulic fracturing that would clearly burden or even halt shale gas exploration and development in some areas. Fracturing rocks deep beneath the surface with high pressure pumping is nothing new, and the arguments presented against are mostly lame. Yet the potential policy bomb has match by the fuse. So it begs the question, which interest groups are championing such legislation? When it comes to defending big-dollar market share, conspiracy theories are usually not theories.”

Ritter singin’ different tune on natural gas, new official says. Grand Junction Daily Sentinel. “Natural gas is “where the Western Slope is going to sing” in [Gov.] Ritter’s effort to build a new energy economy, said Don Marostica, director of the Office of Economic Development and International Trade. He spoke to an audience at the Business Incubator Center. Ritter is “very interested” in using natural gas as a clean source of power for electricity generation and no longer views it merely as a “bridge fuel” to an economy fueled only by solar, wind and renewable fuels, Marostica said. Those fuels will amount to only 10 percent to 12 percent of the state’s energy needs, meaning that fuels such as natural gas will remain in demand, Marostica said. … State Sen. Josh Penry, R-Grand Junction, said he was unconvinced that Ritter is more welcoming of gas drilling. “When Bill Ritter admits that his oil and gas regulations were a catastrophic mistake and fixes them, when he fires the anti-drilling activists that he appointed to the oil and gas commission, when he apologizes to the thousands of men and women who have lost their job and homes as a result of his administration’s extreme policies, then and only then will I believe Bill Ritter has changed his tune on natural gas,” Penry wrote in an e-mail. “Until that time, it’s all just election happy talk, and talk is cheap.”

Marcellus Shale drilling activity robust despite low natural gas prices. Pittsburgh Tribune-Review. “The number of natural gas wells permitted and drilled in the Marcellus Shale formation, including Western Pennsylvania, continues to climb despite the lowest natural gas prices in seven years, officials said. Companies and industry experts say the close proximity of the Marcellus region to the huge East Coast natural gas market and lower drilling costs due to a recession-caused slowdown nationwide combine to keep activity humming here.  ”We anticipated we would issue 700 Marcellus Shale drilling permits for the year, but we surpassed that figure before midyear,” said state Department of Environmental Protection spokesman Tom Rathbun.”

Gas industry prepares to drill in Sullivan, Foes set to protest shale ‘fracking’. Times Herald-Record. “After delaying drilling of the gas-rich shale beneath Sullivan for much of the year, the industry is ready to resume leasing land once the state’s new environmental standards are released, perhaps as early as next month. Drilling of the Marcellus shale could start in the spring. “We’ll do it and we’re looking to do it, once the regulatory hurdles are cleared. Then the permits will flow,” said Brad Gill, executive director of the Independent Oil and Gas Association of New York. … “Natural-gas extraction would create jobs, create wealth for upstate land owners and increase state revenue from taxes and landowner leases and royalties,” said [Gov.] Paterson’s plan, which calls for exploration of natural gas on some state lands.”

From new offices, EQT eyes bigger gas pipeline, creating hub of production. Pittsburgh Tribune-Review. “The last of about 475 employees relocating from a North Shore building started work Monday, including CEO Murry Gerber. Outside, the last of the EQT signs was being installed atop the Liberty Avenue building once occupied by competitor Dominion Resources Inc. … The century-old company that drilled the nation’s first commercial natural gas well changed its name in February from Equitable Resources Inc. The change was a way to point out that it’s no longer just a utility company, but a major gas producer that transports the fuel through pipelines stretching across four states. And EQT was recently added to the closely watched Standard & Poor’s 500 list of stocks. “We are now one of the largest companies in the region,” Gerber said yesterday. Revenue rose 27 percent last year to $1.6 billion. EQT has amassed 3.4 million acres of leases across the Appalachian Basin where it can drill new natural gas wells, including 400,000 acres in the gas-rich Marcellus Shale region of Pennsylvania and bordering states.”

Baker Hughes and BJ Services Strike $5.5 Billion Deal. Wall Street Journal. “Baker Hughes Inc. agreed Monday to acquire BJ Services Co. for $5.5 billion, in an effort to create a new rival to global oilfield-service giants Schlumberger Ltd. and Halliburton Co. The cash-and-stock deal, which company executives said could close by the end of the year, plugs a hole in Baker Hughes’s repertoire that had put it at a disadvantage to its larger competitors. BJ Services specializes in pressure-pumping, a key technology for developing recently discovered natural-gas fields in North America. … In recent years, BJ Services has emerged as a leader in hydraulic fracturing, a technology that allows oil and, in particular, gas to be produced from dense rock formations.”

Energy in Depth: Today’s News

Setting the record straight. Star Gazette, Energy In Depth’s Lee Fuller. “The Aug. 20 letter writer’s opposition to the safe, 60-year-old energy technology known as hydraulic fracturing appears to be founded on a simple claim that hydraulic fracturing previously was regulated federally under the Safe Drinking Water Act, that an exemption was granted to the practice in 2005, and that, “after 31 years of the Safe Drinking Water Act being law of the land,” apparently it no longer is, thanks to this so-called exemption. She will be happy to learn that SDWA remains the law of the land today – in full, and intact. But she’ll be surprised to find out that SDWA has never been used to regulate hydraulic fracturing – not today, not before 2005, not at any point during the law’s 35-year run on the books. Thankfully, hydraulic fracturing continues to be aggressively regulated by the states, as it has been since the moment it was invented. How can something earn an exemption from a law that never covered it in the first place? It can’t.”

After 150 years, age of oil entering an efficiency phase. Houston Chronicle. “Almost from its beginnings 150 years ago this month, the oil industry has been a high-risk international business driven by speculators and technological innovation. … Less than a decade ago there were concerns about the adequacy of domestic natural gas sources, Yergin says, leading to anxiety among power companies and large industrial users. But advances in drilling technology that are letting companies get gas from plentiful shale formations have changed that outlook. Less than a decade ago there were concerns about the adequacy of domestic natural gas sources, Yergin says, leading to anxiety among power companies and large industrial users. But advances in drilling technology that are letting companies get gas from plentiful shale formations have changed that outlook. By some estimates shale gas formations can meet U.S. demands for many decades to come. A report released earlier this year says that including shale, gas reserves estimates are up 35 percent from the year before.”

Water recycling plant proposed for business park. Morning Times. “In the midst of the sharp increase in natural gas exploration across the Twin Tiers over the last several years, many have wondered what its impact will be on the environment. Specifically, residents and local officials have been concerned about what becomes of contaminated water after it is used in the hydraulic fracturing process to release the gas from deep layers of rock. If one Somerset County businessman has his way, the water will be recovered, cleaned, and sent right back to the well sites to be reused.”

Natural gas promise attracts a giant suitor. Press & Bulletin. “Schlumberger, one of the world’s largest field service companies, is setting up a $30 million outpost in Horseheads to stage equipment to develop natural gas wells in the region. … The company is in the process of hiring workers, including laborers, machine operators and office workers, Coates said. Entry level positions — equipment operators — typically pay between $12 to $14 an hour. Logging long hours on round-the-clock drilling operations, they typically make more than $50,000 a year, he added. Schlumberger contracts with energy companies and provides them with expertise, manpower and equipment to tap gas and oil fields. Its primary services include hydro-fracturing, or fracking, which involves shooting large volumes of a chemical solution into wells to fracture bedrock and release gas.”

Colgate professor reports on Marcellus development prospects. Evening Sun. “The outlook for drilling hundreds of wells and producing large quantities of natural gas from the Marcellus Shale in Chenango County is very good, but the industry is about 10 to 15 years out, said a Colgate University geology professor this week. Whitnall Professor of Geology Bruce W. Selleck, who conducted a 45-minute presentation Tuesday for the Chenango County Natural Gas Committee, said the subsurface here – particularly in the southeast quadrant of the county – clearly shows significant potential for Marcellus development. But except for one vertical well drilled on a hilltop in Oxford, exploration in the formation is in the infancy stage. With low prices for the commodity in the marketplace and the state’s regulatory situation still undetermined, there’s no reason for companies to come in, he said.”

Natural gas, crude growing far apart in terms of price. Desert Sun. “While China is fast becoming a leading buyer of crude oil, second only to the U.S., putting pressure on prices, American industry has discovered the technology of “fracking” natural gas, which forces gas out of shale rocks by shooting water and chemicals into them. This has caused a supply glut this summer as moderate temperatures have lowered the need for natural gas used for heating and air conditioning, while supply has surged.”

EID Friday Fact Check: HF Opponents Say the Darndest Things

A Top 10 List of Errors, Half-Truths and Full-On Falsehoods Targeting Hydraulic Fracturing

August has always been a month of last days and final hurrahs – that last trip to the beach, that final good-bye to long, lazy days, glory’s last shot in professional golf. And as the final days of summer set in, so too has the reality for opponents of responsible energy development that, despite millions of dollars spent and an extraordinarily well-coordinated attack strategy deployed, momentum on Capitol Hill to ban the safe, well-regulated energy technology known as hydraulic fracturing has significantly, perhaps irrevocably waned.

The tide has turned. And perhaps in recognition of that fact, anti-frac forces are ratcheting up their efforts in a last ditch attempt to discredit an energy technique that’s been in safe and efficient use for more than 60 years.

Unfortunately, instead of confronting the issue on its merits and in acknowledgement of the facts, the opposition remains hard at work constructing an alternate history and corresponding narrative related to fracturing technology – one in which HF is characterized (wrongly) as new, unsafe, untested, unnecessary and completely unregulated.

Make no mistake: Limiting our list to 10 of the most outrageous frac-related utterances over the past few months was no easy task. With that said, the following represents our best stab at isolating the most egregious cases of disinformation, and correcting the record where appropriate

#10      Claim: “The fluids’ contents are largely unregulated and unknown, the result of oil and gas industry exemptions from the federal Safe Drinking Water Act…” Jennifer Tomsey; LTE in Binghamton Press & Sun-Bulletin; August 16, 2009

Response: Hydraulic fracturing has never been regulated under the Safe Drinking Water Act – not today, not before 2005, not at any point during the law’s 35-year run on the books. Thankfully, fracturing continues to be aggressively regulated by the states through their groundwater protection programs – and has been since the technology was invented. How can something earn an exemption from a law that never regulated it in the first place?

Regarding the assertion that materials used in the fracturing process are “unknown,” a detailed list of those “unknown” substances can be found here, here (page 62), and on the website of the Pennsylvania Department of Environmental Protection (DEP).

#9        Claim: “[D]espite not really knowing what chemicals are being used and despite strong correlative evidence linking hydrofracking with polluted drinking water, there are no regulations in place to govern the use of the process.” John Moore, Canadian radio host; op-ed in The Huffington Post; August 4, 2009

Response: See above for a listing of these “secret” materials. Regarding the second point: “The states,” according to an April 2009 report from the Ground Water Protection Council (GWPC), “have broad powers to regulate, permit, and enforce all activities-the drilling and fracture of the well, production operations, management and disposal of wastes, and abandonment and plugging of the well.” Moreover: “[S]tate laws generally give the state oil and gas director or agency the discretion to require whatever is necessary to protect human health and the environment.”

#8        Claim: “Hydraulic fracturing is linked to drinking water contamination in Pennsylvania and around the country.” Erika Staaf; LTE in Delaware Co. (Pa.) Daily Times; August 4, 2009

Response: From the Pennsylvania DEP website: “Department of Environmental Protection has collected dozens of water supply samples … and determined that nearby gas well hydro fracturing activity has not impacted local wells.” 

#7        Claim: “[A] question came from a woman concerned about natural gas drilling, who claimed that where there is fracking out in Colorado, there are ‘no live births of livestock’ …” Carney: the one question not about health care; Pocono (Pa.) News; August, 18, 2009

Response: According to the Colorado Department of Agriculture, the state has birthed more than 89,000 dairy cows, 225,000 sheep, 800,000 swine, and 2.6 million cattle – some, presumably, having been born over the past several decades in which modern fracturing technology has been deployed.

#6        Claim: “You have very substantial economic elements that are concerned about their abilities to do whatever they want to for their own economic advantages.” U.S. Rep. Maurice Hinchey (D-N.Y.); as quoted by ProPublica’s Abrahm Lustgarten; May 26, 2009

Response: Hydraulic fracturing only about corporate profits? We present the following quotes in response:

“[Marcellus Shale gas] presents an opportunity for [New York] to unlock substantial economic value while helping to achieve a key energy policy objective of importance to the State’s energy security.” NY Gov. David Paterson (D); as excerpted from draft NY energy plan; August, 12, 2009

“Labor income from salaries, wages and benefits will increase by almost $793 million from the creation of over 16,000 person-years of employment.” Potential Economic Impacts from Natural Gas Production in Broome Co.; prepared by Bernard L. Weinstein, Ph.D and Terry L. Clower, Ph.D., July 29, 2009

“We need to put the money in the hands of the people who own the land and the mineral rights. Not the politicians … It’s our land, our royalties and our lives. I am an American. We are the people. If we the people don’t protect our rights, we have no one to blame but ourselves.” Carol Robinson, unemployed pipeline worker and Hinchey constituent; as quoted in Binghamton Press & Sun-Bulletin; August 24, 2009

#5        Claim: “EPA Confirms Drinking Water Contamination by Toxics Used in Hydraulic Fracturing” Headline; Earthwork’s press release; August 14, 2009

Response, from EPA staffer: The [possible contamination] could have come from other things, such as cleaning solvents…” Greg Oberley, EPA staffer, as quoted by Energy Daily (subs. req’d); August 25, 2009

Admission, from ProPublica’s Abrahm Lustgarten: “EPA officials told residents that some of the substances found in their water may have been poured down a sink drain.”

#4        Claim: “Among the contaminants found in some of the [Wyoming] wells was 2-butoyethanol, or 2-BE … which researchers say causes the breakdown of red blood cells, leading to blood in the urine and feces, and can damage the kidneys, liver, spleen and bone marrow.” Jon Hurdle, Reuters, August 27, 2008

Response: Setting aside the fact that EPA has made no claim related to how 2-BE may have found its way into the water in question (and has even suggested, as cited above, that it may have simply been “poured down a sink drain”), consider the following description of the compound offered by the CDC’s Agency for Toxic Substances and Disease Registry:

“Many people are exposed to small amounts of 2-butoxyethanol and 2-butoxyethanol acetate every day.”

“2-Butoxyethanol and 2-butoxyethanol acetate do not build up in plants and animals.”

More on 2-BE’s everyday household use:

“The main use of 2-butoxyethanol is as a solvent in paints and surface coatings … Other products which contain 2-butoxyethanol include … firefighting foam, leather protectors, oil spill dispersants, bowling pin and lane degreaser … 2-BE is a primary ingredient of various whiteboard cleaners, liquid soaps, cosmetics, [and] dry cleaning solutions.”

“2-Butoxyethanol usually decomposes in the environment within a few days and has not been identified as a major environmental contaminant.”

#3        Claim: “It’s just ridiculous … Their forecasting showing production going down dramatically doesn’t make sense, because all we’re trying to do is to go back to the way things were in 2004, before the loophole was inserted in the 2005 energy bill.” Jeff Lieberson, spokesman for Rep. Maurice Hinchey; Platts Gas Daily (subs. req’d); June 1, 2009

Response: Easily could’ve been awarded the top spot on this list; had it come from a member instead of a staffer, it would have. Here are the facts: The “way things were in 2004″ is identical to the way things are in 2009; that is, states continue to aggressively regulate hydraulic fracturing through their ground water protection programs, continue to have access to the all the information they need to exercise full oversight over the process, and continue to update and improve their regulations to reflect changes in landscape, science and new technology.

#2        Claim: “Whether the EPA applied the [Safe Drinking Water Act] to fracturing or not, prior to 2005 it had the authority to do so, according to the agency’s former assistant administrator for water, Benjamin Grumbles. Now it does not.” Abrahm Lustgarten; ProPublica; July 13, 2009

Response #1: “EPA does not regulate – and does not believe it is legally required to regulate – the hydraulic fracturing of methane gas production wells.” Fmr. EPA administrator Carol Browner; letter to David Ludder; May 5, 1995

Response #2: “The fact is, if the language clarifying hydraulic fracturing had not been in the 2005 Energy Policy Act, every state in the union would be in exactly the same regulatory posture as they are today, except Alabama.” Dennis Lathem; LTE in Grand Junction (Colo.) Daily Sentinel; July 14, 2009 

… Drum Roll Please …

#1        Claim #1: “[M]ore than 1,000 other cases of contamination have been documented by courts and state and local governments in Colorado, New Mexico, Alabama, Ohio and Pennsylvania.” Abrahm Lustgarten; ProPublica; November 13, 2008

Claim #2: “If they find that the contamination did result from drilling, [it] would become the first site where fracturing fluids have been scientifically linked to groundwater contamination.” Abrahm Lustgarten; ProPublica; August 25, 2009

Response: Which is it? Thousands of cases of contamination, or just one? These two statements openly contradict one another.

Energy in Depth: Today’s News

Prospect of decades of returns makes Marcellus Shale the hot place to be. Pittsburgh Business Times. “To hear natural gas companies speak of their immediate drilling ambitions, one might be surprised to learn that the price of natural gas at the wellhead has at times this month dipped below $3 per thousand cubic feet, continuing its monumental tumble from a high of more than $13 in early July 2008. Demand is down, while gas storage is at a high – 20 percent higher than it was this time last year. The nation’s storage fields are full. Yet, gas drilling marches on, especially in unconventional plays such as the Marcellus Shale, with many companies racing to declare how much their production targets are ballooning for the coming months.”

Results of Doyon gas drilling still unclear. Fairbanks Daily News-Miner. “Explorers are still analyzing the results of a test drill in the potentially natural gas-rich Nenana Basin west of Fairbanks, an executive for Doyon Ltd. said Thursday. Jim Mery, a vice president of the Interior’s regional Native corporation, said the firm and three exploration partners will meet within weeks to discuss future plans at the basin, where Doyon has leased 500,000 acres for potential gas development. Until that meeting, he said, the group has agreed to withhold data from a well drilled in late July and early August, Mery said. He added that Doyon is “very encouraged” by the results.”

Gas price drop helps some, hurts others. The Advocate. “Low natural gas prices lower consumers’ electricity bills and help the state’s petrochemical and wood products industries, while hurting energy companies and putting a dent in the state’s revenues, economist Loren Scott said Thursday. Natural gas prices plunged to their lowest level in seven years, $2.73 per thousand cubic feet, after the federal government reported storage levels are rising. “It’s great news for the petrochemical industry, which uses prodigious amounts of natural gas,” Scott said. … The lower price is not so good for energy companies, who have seen supplies jump as a result of shale plays, such as the Haynesville Shale in north Louisiana. The shales become less profitable as the price drops to less than $3 per thousand cubic feet, Scott said. Drilling a well in the Haynesville Shale is expensive. The wells are deep, then drilled horizontally, and water must be injected to aid production.”

Northern Petroleum ups production estimates for Grolloo. Proactive Investors UK. “Shares in UK-based junior oil and gas producer Northern Petroleum surged over 7.5% today after the company released an operational update from its Grolloo field in the Netherlands, which has recently been hydraulically fractured. … “Overall the hydraulic fracturing programme has exceeded even our upside expectations. Now we look forward to bringing the Grolloo gas field onstream at greater levels of production and profit,” said Managing Director Derek Musgrove. Northern is now awaiting results from the hydraulic fracturing programme at Geesburg well, which is currently underway.”

Energy in Depth: Today’s News

NAPE: Frac regulation Washington’s ‘worst threat’. Oil & Gas Journal. “A move to regulate hydraulic fracturing federally is the “biggest threat our industry has ever seen in Washington,” Bruce Vincent, vice-chairman of the Independent Petroleum Association of America, said Aug. 26. Joel Noyes, IPAA director of government relations and industry affairs, expressed a low expectation for passage of most of the Obama administrations frenzied agenda, much of which contains negative provisions for oil and gas producers. … Ninety percent of wells are hydraulically fractured, some dozens of times, Vincent told the Summer NAPE E&P Forum in Houston. In the 60 years that the industry has been fracturing wells under state regulation, no case of fresh water contamination by the procedure has been documented, he said.”

The Independent Weekly Line on Durango and Beyond. Durango Herald. “Drilling and drinking water are clashing head-on in the West. Federal officials recently announced the contamination of numerous wells near the town of Pavillion, Wyo. At least three of the 39 wells tested contained a chemical known to be used in the controversial practice of hydraulic fracturing, or fracing. … However, the oil and gas industry dismisses the allegations as overblown and an attempt to derail the responsible development of oil and gas resources. Chris Tucker, of the industry group Energy in Depth, commented, “What we’re seeing is a classic ends-justify-the-means approach to halting sensible energy exploration. Did EPA say that drinking water was contaminated? No. Did it say that fracturing technology was to blame for any contamination? No. Did it say that energy development in the area contributed in any way to the outcome of its first round of tests? No. But those claims are just the means. As long as the end – no energy, no jobs – is achieved, the method can apparently be forgiven.”

Drilling Has Changed Considerably Since The First Boom. Wetzel Chronicle. “A common sight in the 1800’s in Wetzel County and the state of West Virginia, tall oil derricks doting the county side, are now being replaced by the new technology of drilling in the 21st century. … With the Marcellus Shale in the area as the next big natural gas shale basin, great-grandfathers of the past oil drilling boom days would shake their heads in disbelief of this new way of drilling for natural gas, horizontally. Horizontal drilling is the process of drilling a well from the surface down to targeted gas bearing formations, then turning the wellborne horizontal and continuing to drill sideways while staying within the formation. … Fracing a well is also part of Chesapeake’s development in getting the natural gas out. Sand, water, and other additives are pumped at high pressure down the wellbore. This, in turn, causes fracturing of the rock, sand, and propellants in the cracks.”

Fracing continues to pose hot topic for commissioners. Durango Herald. “Hydraulic fracturing continues to divide La Plata County commissioners, with a second resolution on the practice falling by the wayside Tuesday. … The resolution, put forward by Commissioner Joelle Riddle, called for a review of fracing by the National Academy of Sciences “using a panel of highly qualified experts and applying scientific standards and methodology.” Last month, Riddle cast the deciding vote to defeat a resolution put forward by Commissioner Wally White in support of federal legislation that would repeal the exemption of fracing fluids from regulation under the Safe Drinking Water Act. “I don’t think the community, nor was I, happy with the last vote that we took,” she said.”

Marcellus shale gas drilling planned for Baldwin Borough. Pittsburgh Post-Gazette. “Baldwin Borough officials announced last night that Dale Property Services Penn LCC, has scheduled meetings to explain natural gas drilling plans and to secure mineral rights and lease agreements from residents. Mayor Sandy Bennett said a session will be held from 7 to 9 p.m. Sept. 8 in the borough building’s meeting room. A second meeting at which residents can sign lease agreements will be the following evening. Dale Property Services, a local company hired by the Oklahoma-based Chesapeake Energy Corporation, is seeking lease agreements from residents in the Lafferty Hill and Churchview Avenue areas to tap into the Marcellus shale formation beneath their homes.”

Energy in Depth: Today’s News

State experts testify to subcommittee on energy. Tulsa World. “Congress came to Tulsa on Tuesday to hear concerns about the nation’s energy policy and its impact on small businesses. U.S. Reps Mary Fallin and Jason Altmire spearheaded an official “outside the Beltway” hearing of the House Small Business Subcommittee on Investigations and Oversight at Oklahoma State University-Tulsa. … “Energy plays a critical role in every sector of our economy,” said Altmire, making his first visit to Oklahoma. “We must be sure to factor in small business needs.” … The witnesses raised fears about possible federal regulation of hydraulic fracturing in natural gas wells and hopes of incentives to promote energy efficiencies. “Any government policy that would cause increases in energy costs during a severe recession, like we are in now, is simply bad policy,” Oklahoma Independent Petroleum Association President Mike Terry testified. … Bob Sullivan, a former state secretary of energy, warned that eliminating the write-off of certain drilling costs and the proposed federal wresting oversight of hydraulic fracturing from the states could scare off investors who help offset the risks of exploration.”

State hears Tier views on natural gas drilling. Press & Bulletin. “Like the elephant in the room, however, the development of natural gas in the Southern Tier’s portion of Marcellus Shale could not be ignored. … Others, representing business groups, including Unshackle Upstate, said it was imperative state agencies approve the drilling, letting the gas — and profits — flow into cash-strapped New York. … “This resource presents an opportunity for the state to unlock substantial economic value while helping to achieve a key energy policy objective of importance to the state’s energy security,” the report states. Currently, New York imports 95 percent of its natural gas from other states, Congdon said.”

Riddle not first to leave party. Durango Herald. “Then, a month ago, Riddle joined Hotter in voting against a nonbinding resolution that supported legislation before Congress that would end the exemption of hydraulic fracturing liquids from Safe Drinking Water Act regulation. Commissioner Wally White, a Democrat, was the lone supporter. Commissioners will revisit the fracing issue today when they vote on a resolution that supports a review by the National Academy of Sciences on whether underground sources of drinking water are affected by hydraulic fracturing in coal-bed methane production.”

Natural Gas Review. WBNG-TV. “A major topic of concern at Tuesday’s The State Energy Board public forum: drilling into the Marcellus Shale for natural gas. People spoke about the economic boosts and environmental impacts. Drilling is currently on hold in New York State. The Department of Conservation is currently reviewing hydraulic fracturing and horizontal drilling.”

Santulli: Schlumberger Will Help “Reinvent” Chemung Co. WENY-TV. “I hope that in a year, in five years, in 10 years from now, you’re going to say how great of a corporate citizen we’ve been,” said Coates. Coates says Horseheads is the perfect place to be to tap into the Marcellus Shale’s 516 trillion cubic feet of natural gas. “I think we’re going to have a successful partnership, I think we’re going to make a lot of money, and I think the resident and the towns and schools will all benefit from that,” said Coates. Coates and Chemung County Executive Tom Santulli addressed some concerns about truck traffic and chemical storage. “You know what? That’s what we’re elected and paid to do. We’ll take care of those issues,” said Santulli. … Coates says Schlumberger is committed to Chemung County, even though the Department of Environmental Conservation has yet to OK the horizontal drilling method. “We would still do what we’re going to do. The investment that we’re making would be fully paid back by just the activity in Pennsylvania,” explained Coates. Schlumberger will eventually hire 400 people. Southern Tier Economic Growth president George Miner says the benefits will extend beyond local employment. “People are going to be relocating here. People are going to be getting jobs here at much better wages than what they’ve been paid in the past. They’re going to upgrade homes, expand homes, and will increase home values throughout the area,” said Miner.”

Schlumberger’s Coates addresses local business leaders. Elmira Star-Gazette. “Local government officials and business leaders say they are excited about the company’s plans, which will create up to 400 jobs a means a $30 million investment by Schlumberger to build the facility. … “We are an industry that’s new to this area and if we put out information about what we do and why we do it over and over again, people should become educated,” Coates said. “We want them to support us the same way that the local governments and other groups support us.”

Officials downplay Schlumberger issues. Corning Leader. “Schlumberger’s North American president, Bill Coates, fielded questions and distributed information sheets about the company’s planned facility in the Holding Point industrial park in Horseheads and the safeguards that will be put in place. … Schlumberger will also supply radioative materials used to “X-ray” underground formations, and chemical additives used in hydrofracturing fluid, the water-sand mixture used to crack open underground formations. … In the last few weeks, Schlumberger has hired about 20 local employees to staff the facility, and will hire more as the construction progresses, Coates said. George Miner, president of Southern Tier Economic Growth, said he wanted to “roll out the red carpet” for Schlumberger, and said there are “very few communities in the world, much less the U.S. or upstate New York, that ever get an opportunity to have a company like Schlum-berger express an interest in locating here.” The impact will be felt in many ways, Miner said, pointing to an estimated 400 jobs the facility will create. The company will be here for decades, he said, offering careers to young people. … Chemung County Executive Tom Santulli touted the vast economic potential of the Marcellus Shale and called it “the grand slam home run that every community hopes it gets” in terms of the companies it has brought to the Southern Tier, and the windfall that may await landowners who sign gas leases.”

Gas-drilling firm’s plan scrutinized. Elmira Star-Gazette. “We are still in the process of answering all the written questions,” Boisvert said. “Several agencies are reviewing the project. We anticipate responding to all of that information early next week. We started the process in February to determine the potential impact as a result of this project. “We included a lot of environmental studies in regard to traffic, noise, archeological, wetlands, etc.,” he said. “We provided that information up front in our May 28 submittal. We’ve received comments from various agencies. We are in the process of responding to those comments.” Schlumberger plans to build its facility on about 90 acres it purchased in The Center at Horseheads industrial park. The project is expected to create 400 new jobs.”

Energy in Depth: Today’s News

Warming up to gas prices. Boston Globe. “The falling price of natural gas is a basic economic story about supply and demand. Now gas storage facilities are brimming and customers are watching their consumption as they struggle through the recession. Supply has been increasing sharply thanks to new discoveries and drilling technology that opened large shale gas fields across America. Demand shrunk when individual customers and big industries all cut back in the midst of a hard recession. Relatively mild weather, both last winter and this summer, is a smaller factor constraining demand for gas.”

WC resides above world’s largest gas reserve. Wayne Independent. “A massive energy reserve that resides below Wayne County and throughout the Appalachian Basin could supply U.S. natural gas needs for at least 20 years, newly released estimates show. Penn State geologist Terry Engelder recently reported in an industry oil and gas magazine that the Marcellus Shale could yield 489 trillion cubic feet of natural gas, a much higher estimate than previously calculated. For comparison, the U.S. uses an estimated 22 – 24 trillion cubic feet of natural gas annually. “It’s fair to say right now in the gas shales that are being produced, it is the largest” in the world, said Engelder in a phone interview with The Wayne Independent on Monday. Other undeveloped reserves in Russia, for example, may contain a larger or comparable volume once production hits full swing there, he said. But for now the Marcellus Shale – a vast rock formation stretching beneath New York, West Virginia and the Commonwealth – is the largest unconventional natural gas reserve by volume in the world.”

Enerplus enters Marcellus shale joint development. Oil & Gas Journal. “Enerplus Resources Fund entered into a joint development agreement for work in the Marcellus shale with two private companies, both based in Texas. Chief Oil & Gas LLC, Dallas, and Tug Hill Inc., Fort Worth, agreed to sell 30% interest of their Marcellus shale assets for $406 million, of which $162.4 million is due at closing and $243.6 million is to be paid as a carry of 50% of Chief’s future drilling and completion costs.”

Ag Progress Days draws record number of exhibitors. American Farm. “Advancements in drilling technology have triggered interest in the potential of Marcellus shale natural gas. The formation has been conservatively estimated at 168 trillion cubic feet. The impact of drilling on wildlife, forests and especially water spotlighted several theater presentations. Penn State forester Bryan Swistock outlined the regulations and delineated steps landowners can take to protect from contamination during natural gas drilling. Swistock explained the array of fluids in the hydrofracturing process, noting which require treatment and which are subject to disposal regulations. Most oil and gas firms, he added, would perform a pre-drill survey to document the existing water supply prior to drilling. He advised landowners to secure that survey.”

Germany Celebrates 150 Years of Oil and Natural Gas Production. Oil Voice. “The oil age began 150 years ago when an oil well struck oil for the first time in Wietze in Lower Saxony in Germany. Today most of the products we use on a daily basis would be unthinkable without crude oil – from containers for the food industry to CD’s and DVD’s to textiles and pharmaceutical products. Crude oil and natural gas have become the most important raw materials for developed industrialized nations. … In Leer in Lower Saxony, stateof-the-art technologies are being used to develop difficult-to-access tight gas reservoirs. A technology known as hydraulic fracturing is used to create fractures in the reservoir rock, thereby increasing the gas flow rate and improving the flow into the borehole.”

Energy in Depth: Today’s News

2000 attend rally for natural gas drilling. Press & Bulletin. “Responding to a rallying cry to protect their rights and royalties, about 2,000 people gathered in Bainbridge on Sunday afternoon to urge state officials to allow energy companies to drill for natural gas in their backyards. With hundreds of millions of dollars on the line, landowners, bankers, lawyers and gas industry representatives filed into General Clinton Park and fanned out across the sprawling grounds along the Susquehanna River. Some wore bright yellow T-shirts stating: “Pass gas. It’s a movement.” Dan Fitzsimmons, an organizer, said 871 vehicles parked for the event, many with two or more occupants. … Volunteers set up tables, collecting signatures on letters to federal representatives, including U.S. Rep. Maurice Hinchey, D-Hurley. The lobbying effort opposes the Frack Act, legislation to tighten federal regulations on hydraulic fracturing, also called fracking. The controversial process stimulates well production by shooting millions of gallons of chemical solutions into the ground to fracture bedrock and release natural gas.”

Landowners Gather to Discuss Safe Gas Drilling. FOX 40 News WICZ TV. “Pass Gas,” that’s the slogan for supporters of natural gas development, and thousands gathered at General Clinton Park to share their thoughts on how it might impact our area. “I think it’ll improve the economy in the area, I think it’s the safest form of resource for fuel in the country,” said Greg McKee of Bainbridge. And with a struggling local economy, lawmakers say safe drilling is a no-brainer with all the money it will bring in. “Millions of dollars that could revitalize this community and individuals who have had tough times that are landowners,” Libous said.”

Landowners Rally For Gas Drilling. WBNG-TV. “Hundreds of people from across the Southern Tier want New York to get busy and begin drilling for natural gas. Landowners rallied together to voice their dissatisfaction with months of delay. Action News reporter Leigh Dana has the story. Their t-shirts say it all. Priority number one — start passing gas… Hundreds of people including members from 23 gas drilling coalitions held a rally at General Clinton Park Bainbridge. They’re pushing for drilling to begin. “They were supposed to come out in April. It’s been dragged out and they’re saying September now,” says Dan Fitzimmons with the Binghamton/Conklin Landowner’s group. Landowners and business owners expect gas drilling to begin as soon as possible. They want gas drilling to begin, well, months ago.”

Hundreds rally for gas-lease rights. Oneonta Daily Star. “A rally Sunday sponsored by supporters of natural-gas drilling in the area attracted hundreds of people to General Clinton Park in Bainbridge, according to organizers. “It went very well,” said Richard Downey, a member of the steering committee of one of the Unatego Area Landowners Association. The association was one of 25 groups from nine counties that comprise the Joint Landowner Coalition. … The rally was more of an informational meeting about the economic opportunities for the area that natural-gas drilling can provide, he said. ”

Natural gas: The key U.S. energy source for the next decade? Daily Finance. “Natural gas is experiencing a perfect storm of new technology, a reluctance to cut production, and a pricing anomaly that together may make it a dominant energy source in the U.S. in the decades ahead. How has this happened? … Estimated U.S. natural gas reserves have increased 35 percent, mostly on the ability to access those new sources, with estimated reserves totaling 2,074 trillion cubic feet in 2008, up from 1,532 trillion cubic feet in 2006, according to the Potential Gas Committee, the New York Times reports. … Natural gas is not without environmental concerns: it has a low (but not zero) impact on climate change, and some environmental groups are concerned that hydraulic fracturing will pollute drinking water sources. But the advantages of energy independence, more flexible foreign policy, ample reserves, retained wealth and increased jobs, and a lower carbon footprint tip the scale well in favor of a much bigger role for natural gas.”

DOE Selects Nine Projects Targeting Environmental Tools, Technology For Shale Gas And CBM Production. New Technology Magazine. “The Office of Fossil Energy’s National Energy Technology Laboratory (NETL) has selected nine new projects targeting environmental tools and technology for shale gas and coalbed methane (CBM) production. NETL’s goals for these projects are to improve management of water resources, water usage and water disposal, and to support science that will aid the regulatory and permitting processes required for shale gas development.”

Joelle Riddle leaves Democratic Party. Durango Herald. “La Plata County Commissioner Joelle Riddle, former chairwoman of the La Plata County Democratic Party who won her post in 2006 with party support, switched her affiliation to Independent on Friday. … The most controversial deviation from what apparently would have been expected of Riddle occurred July 14 when she joined Republican Commissioner Kellie Hotter to defeat a resolution to support federal regulation of chemicals used by gas and oil companies to fracture rock in drilling wells. White, who moved to support the resolution, was the lone affirmative vote. The resolution, which was nonbinding, supported legislation before Congress that would have ended the exemption of hydraulic fracturing fluids from regulation under the Safe Drinking Water Act.”

Range Resources finds recipe for success in shale. Fort Worth Business Press. “Range Resources Corp. has made quite a name for itself over the past several years, expanding to energy plays nationwide. The Fort Worth-based company, which specializes in the exploration and production of oil and gas, is a big player in North Texas’ Barnett Shale gas play and subsequent discoveries, such as the Marcellus Shale in the Appalachian Basin. Company CEO and Chairman John H. Pinkerton credits technology, teamwork and hard work as factors to the company’s success. “Two things made the shale plays economic. One is technology,” Pinkerton said. “We knew [the gas] was in the Barnett and the Marcellus but we didn’t have any way to get it out. I tell people it’s like trying to get gas out of concrete.”

Mind the O-GAP: Fact-Checking OGAP’s Assertion of HF-Related Contamination in Wyo. Drinking Water

Unwilling to oppose the responsible development of clean-burning natural gas – and the jobs and revenue that go with it – on its own merits or in those specific terms, anti-energy groups continue to focus their attacks on disparaging the essential tools of the trade, if not having the courage to confront the trade itself.  

That strategy, such as it is, was on display again last week, as the Oil & Gas Accountability Project (OGAP) issued a breathless press release to national energy reporters stating categorically that EPA had “confirmed” that materials used in the hydraulic fracturing process in Fremont County, Wyoming had “contaminated” local “drinking water.” 

No evidence to support that claim was offered; no links to relevant EPA studies or reports were provided; no EPA experts were cited, named or quoted. And none of that seemed to matter, claimed OGAP, since it had it on good authority that “a group of over 70″ had been told by EPA that the contamination did occur, and that activities related to hydraulic fracturing were to blame. Case closed. QED.

Having established its (unverifiable) version of the facts, OGAP was quick to offer up a resolution: Ban hydraulic fracturing. And one way to do it, the group suggests, is to convince Congress to pass the DeGette/Casey anti-fracturing bill – a “critical” tool for “prohibit[ing] endangerment of drinking water,” even though hydraulic fracturing has not once in 60 years been credibly linked to any such endangerment.  

As it turns out, the “facts” presented in the OGAP press release don’t quite measure up to the facts on the ground in Wyoming. What follows is a quick Q&A laying out what we currently know of the situation, what we do not, and what’s being done to ensure we get it right:

Q:        Did this EPA meeting actually take place? Did EPA officials say that fracturing activities contaminated local drinking water supplies?

A:         Yes it did. And no — they most certainly did not. Earlier this year, EPA was asked by residents of Pavillion, Wyo. to study the quality and composition of area aquifers – aquifers known to contain water of high-turbidity (cloudiness), a natural phenomenon wholly unrelated to energy exploration.

Having tested 40 separate wells, initial results from EPA indicated that in a few of those wells at least one “tentatively identified compound” (TIC) was found. A TIC, generally understood, is a compound that can be picked up by the analytical testing method, but not confirmed or adequately identified without further investigation.

The facts of the meeting are these: EPA made no claim that these TICs were in any way related to drilling; that they were in any way related to hydraulic fracturing; or that they posed a serious and/or immediate threat to human health.

Q:        When will EPA know for sure? Is it studying the issue further?

A:         Yes it is. But estimates of how long EPA will need to conduct a thorough study of the aquifer vary – with some suggesting the agency can produce a final report in weeks, and others claiming it might take much longer.

To help facilitate the process of gathering, distributing and exchanging critical information related to this investigation, area energy producers are working closely with EPA to ensure the agency has everything it needs to make a final, accurate determination.

Q:        The OGAP press release says this same thing happened in Colorado a few years back – causing the “Amos Well disaster.” Are they right?

A:         Laura Amos, a resident of Garfield Country, Colo., alleged in 2001 that her water well was contaminated by materials used to fracture several natural gas wells located near her house. Ms. Amos specifically claimed these frac fluids contained the chemical 2-butoxyethanol (2-BE), and that she had been exposed to them.

On at least eight separate occasions between 2001 and 2005, staff from the Colorado Oil & Gas Compact Commission (COGCC) tested the Amos well for those materials, as well as for benzene, toluene, ethylbenzene, and xylenes (BTEX). After years of thorough investigation by the agency, however, Ms. Amos’s allegations were dismissed – with COGCC reaching the conclusion that frac fluids never reached the well.

–

Additional resources available at Energy In Depth:

• Press Release: Duplicative hydraulic fracturing rules could imperil U.S. economy
• GWPC Study: State Oil and Natural Gas Regulations Designed to Protect Water Resources
• Graphic: How Far Down Do We Frac?
• Graphic: What’s In Frac Fluids?
• Fact Sheet: New Federal Regulations Will Cost Americans Jobs, Revenue, and Security
• EPA Study: Study to Evaluate the Impacts to USDWs by Hydraulic Fracturing of Coalbed Methane Reservoirs
• Browner Memo: Letter of Support for Hydraulic Fracturing from Carol Browner, Fmr. EPA Administrator

Energy in Depth: Today’s News

Memo to Washington: Colorado can regulate its own industry, thank you very much. Grand Junction Free Press, Kathy Hall. “Over the past several months, hydraulic fracturing has become a hot topic and subjected to much misrepresentation. In June, Congresswoman Diane DeGette, who represents Colorado’s 1st District, introduced the Fracturing Responsibility and Awareness of Chemicals Act of 2009, the “FRAC Act.” The bill is an attempt to give authority to the federal government to regulate a widely-used and safe process that is already being effectively managed at the state level. Colorado regulates its own oil and natural gas industry, as do all states. Each state regulates its industry in a manner that protects the people and the land, while producing quality energy for our nation.”

Enerplus to pay US$406 million for U.S. shale gas properties. Canadian Press. “Shale gas is the promising new area of natural gas development in North America, with significant production from the Barnett shale zone in Texas and promising new discoveries from the Horn River play in northeastern British Columbia. Interest in the unconventional fuel has also spread to Europe. Some analysts expect shale gas to supply as much as half the natural gas production in North America by 2020. The fuel is produced from shale, or solid rock so production in commercial quantities requires multiple fractures and many small wells to let the gas flow. Modern technology in hydraulic fracturing to create extensive artificial fractures around well bores has made it easier to extract the gas. Horizontal drilling is often used with shale gas wells.”

DOE funds nine shale gas, coalbed methane technology efforts. PennEnergy. “The US Department of Energy’s National Energy Technology Laboratory is supporting nine projects targeting environmental tools and technology for shale gas and coalbed methane production, DOE’s Fossil Energy Office announced. … It said that General Electrical Co. of Niskayuna, NY, will receive $799,897 to use with $199,976 of its money for an 18-month project to develop a low-cost mobile process to treat total dissolved solids in hydraulic fracturing operations’ flowback water.”

Natural gas futures rebound after hitting 7-year low. Fort Worth Star-Telegram. “Natural gas futures slipped Wednesday to their lowest since 2002 before rallying modestly as buyers stepped in, but traders remain concerned that a glut of the fuel will weigh on the market until demand sets in with colder weather. Gas futures bottomed out at $3.0549 per million Btu, then closed at $3.12, up 2 cents from Tuesday. That gain followed nine consecutive days of declining prices. … While industrial demand in particular has fallen, U.S. gas supplies have also swelled because of new production such as the Barnett Shale and newer shale fields in Louisiana and Appalachia. As recently as four years ago, 20 percent of all natural gas in the U.S. came from the Gulf. That has fallen to about 12 percent, according to the energy administration. The same fear of oversupply that has kept prices low and discouraged bidding on offshore leases has also slowed drilling onshore. As of last week, 75 drilling rigs were active in the Barnett Shale, compared with more than 200 at the peak in October, and 968 rigs were working nationwide, compared with 1,992 in November.”

Enviro to drill more coal seam gas wells in China. Reuters. “Enviro Energy International Holdings, plans to drill up to five wells of coal-bed methane/shale gas in Western China this year, and five more in 2010, a top company official said on Thursday. Hong Kong-listed Enviro will pump some $2.25 million in exploratory activities in China, especially in the Junggar Basin in western Xinjiang province, Chief Executive Officer Kenny Chan told Reuters in an interview.”

Energy in Depth: Today’s News

Resolution favors state control of fields. Muskogee Daily Phoenix, Op-Ed. “Something extraordinary just happened in the battle waging over an oil and gas industry production method widely used in Oklahoma. No, it isn’t the firestorm of controversy created by some misinformed members of Congress who have recently proposed damaging and expanding federal regulation of the oil and gas industry. And no, it’s not the avalanche of strong opposition coming from the energy companies, their trade associations, legislative leaders from energy producing states or even from state regulators of oil and gas. What is extraordinary is the recent adoption of a supportive resolution from a nationally prominent group that is committed to fairness and the public interest for utility consumers and to the protection of drinking water and the environment.”

Cap-and-trade won’t pass Senate, Brownback tells KIOGA. Wichita Eagle. “Sen. Sam Brownback said Monday he doesn’t expect cap-and-trade legislation to be passed this fall by the Senate. That was welcomed news for his audience at the annual convention of the Kansas Independent Oil and Gas Association at the Wichita Airport Hilton, particularly since the House passed a cap-and-trade bill earlier this summer. … The panel addressed two other key issues facing the oil and gas industry – proposed changes in the federal tax laws and bringing the production process of hydrofracturing under federal regulation.”

GarCo leads in permits during down drilling year. Grand Junction Sentinel. “Garfield County has leapt out in front in the number of oil and gas drilling permits approved so far this year, new state statistics show. Meanwhile, Mesa County remains in third place in permits approved by the Colorado Oil and Gas Conservation Commission. The commission’s staff continues to project a sharp decrease in overall permit approvals for the year in light of energy companies cutting back on drilling rig numbers in the state.”

Energy in Depth: Today’s News

The Saudi Arabia Of Shale. Investor’s Business Daily, Editorial. “Drilling of the Marcellus in New York state has not yet begun. Gov. Patterson, to his credit, wants to change all that, but he’s meeting stiff opposition. Robert Kennedy Jr.’s Riverkeeper and other greenie groups object to the means of extracting gas and oil from shale – a technique known as fracking. Fracking involves injecting water, with sand and other additives, into the rock to push the gas into accessible pockets. Improvements in technology allow drilling horizontally from a single, above-ground well, reducing the above-ground hit on the environment. Kennedy and the rest of the fracking opposition say that since the technique uses a lot of water, we should worry about possible groundwater pollution and the impact on water supplies, rivers and streams. Proximity of the Marcellus formation to New York City’s watershed has caused concern.”

Natural gas stocks defy gravity. CNNMoney.com. “Many analysts prefer companies with assets in North American shales, which experts believe have the potential to yield hundreds of trillions of cubic feet of natural gas. But getting natural gas from the rocks is a difficult feat, requiring a complicated and expensive drilling process called hydraulic fracturing. As a result, says Dahlman Rose’s Pope, technological ability is extremely important right now. “You’re seeing a shift in structure of these companies,” he says. “It’s become more of a manufacturing game — they know the gas is there, and the challenge is getting it out.” Pope likes gas producer Southwestern because he admires their its focus on drilling in the Arkansas’ Fayetteville Shale.”

‘Concrete’ proof of gas development impact. Williamsport Sun-Gazette. “A  proposed cement plant in Clinton Township is concrete proof that developing natural gas resources in the Marcellus Shale region will produce jobs for local residents. So said local officials Monday during a groundbreaking ceremony kicking off the construction of a gas drilling support complex in the River Valley Commerce Park in Clinton Township. The complex will be built and operated by global oil and gas industry support company Halliburton. The facility will produce concrete specifically for the gas drilling industry and could generate up to 300 jobs, according to company officials.”

Energy in Depth: Today’s News

Washington: Colorado can regulate its own industry, thank you very much. Grand Junction Sentinel, Western Slope Colorado Oil and Gas Association executive director Kathy Hall. “There hasn’t been a single case of contamination by hydraulic fracturing fluids over the course of 60 years and the more than one million wells that have used fracking. … [Rep.]  DeGette acknowledged there isn’t any proof that hydraulic fracturing is an unsafe practice. She states that what she is basing her legislation on is a lot of anecdotal evidence. … DeGette’s bill creates unnecessary one-size-fits-all federal legislation that doesn’t offer any true protection.”

No Respect? Cheap Natural Gas Draws Political Crowd. Wall Street Journal. “There’s no mystery as to what’s behind natural gas’s continued free-fall: surging supplies (think, Haynesville Shale) and anemic demand (the recession). Neither shows any signs of a quick fix. Most natural-gas producers are actually on track to beat production targets despite reduced drilling, and the Energy Information Administration expects U.S. gas demand to fall 2.6% this year. Many experts expect gas storage, already 20% above normal, to fill up by the fall. But there’s a glimmer of hope on the horizon: Democrats in Washington might finally be getting on the natural-gas bandwagon. On a trip to Colorado last week, Interior Secretary Ken Salazar last week told the Grand Junction Daily Sentinel that he wouldn’t seek to withdraw drilling leases in the Roan Plateau and that “the future of natural gas is very bright.” In short, he wants to use energy policy to increase demand for the stuff because it’s an abundant source of fuel that has less carbon than coal or oil.”

Water disposal wells possibly linked to earthquakes, not fractured wells. Dallas Morning News. “Chesapeake Energy shut down two wells, including one at DFW Airport, just in case they contributed to recent earthquakes. But here’s an interesting part: One well was a salt water disposal well. That is, a well for disposing salt water used to help fracture natural gas wells. It is not a hydraulic fracture well. To produce natural gas in the Barnett Shale, companies typically fracture the rock surrounding the well, often with explosives, and then inject a mixture of water and chemicals into the well to allow natural gas to flow.”

Energy Expert Robert Kennedy, Jr. Opposes Natural Gas Drilling in New York State. RedState. “Noted energy expert, environmental Luddite and hypocrite Robert Kennedy, Jr., aims to stymie natural gas drilling in New York State by hyping unrealistic and irrational fears of environmental contamination. At issue is the method used to stimulate production in gas wells known as hydraulic fracturing, or “fracking”. Truth be told, Kennedy and the greenies would find something objectionable in anything an energy company would propose.”

States weigh benefits, risks of drilling in parks. Associated Press. “State parks aren’t just for hiking, camping and other recreation anymore. Increasingly, these lands are being used for oil and gas drilling as budget-strapped states seek new sources of revenue. As they allow more energy exploration in state parks – in some cases by reversing previous bans – lawmakers are being met with resistance from environmentalists and park officials. Opponents of the drilling say it raises troubling questions about acceptable uses of publicly shared land – even when new technology allows rigs positioned outside park boundaries to reach petroleum pockets deep beneath the parks by drilling horizontally.”

Energy in Depth: Today’s News

NY’s Power Needs: Drill, Baby, Drill. New York Post, Op-Ed. “WITH the unveiling this week of the draft state energy plan, Gov. Paterson continues his policy of professing support for producing natural gas from the vast Marcellus Shale — even as he lets state regulators hold up drilling over spurious environmental fears. … The critics complain that hydraulic fracturing, or fracking, would be used to extract gas trapped in the shale’s pores. This involves temporarily injecting water (with sand and very small amounts of nitrogen, carbon dioxide and other additives) into the rock to push gas into pockets for easier recovery. Yet recent improvements allow horizontal fracking — once you drill down, you can move laterally underground to recover resources. Translation: a much smaller aboveground footprint and less natural disruption. … Note, too, that the country has more than six decades of experience with the process. As Sen. James Inhofe (R-Okla.) notes, hydraulic fracturing has helped produce 7 billion barrels of oil and 600 trillion cubic feet of natural gas from more than a million US wells. It is now used in about 35,000 wells nationwide, with minimal impact on local surroundings and no environmental problems. “In hydraulic fracturing’s 60-year history, there has not been a single documented case of contamination,” Inhofe noted.”

Marcellus Shale Important for State’s Economy. Gant Daily, Congressman Glenn “GT” Thompson. “Clean, safe, responsible, well-regulated Marcellus natural gas production in Pennsylvania has already paid dividends for our region and Commonwealth. According to a recent Penn State study, Marcellus Shale natural gas drilling last year generated 29,000 jobs, added $2.3 billion to the economy and generated $240 million in state and local taxes. For 2009 the estimates are 48,000 jobs, $400 million in tax revenues and economic output will top $3.8 billion. Without the environmentally safe and proven 60-year old drilling process known as hydraulic fracturing, the clean-burning natural gas could not be produced from the Marcellus or any other place in the country.”

Five Things Congress and the President Are Doing to Bring Back Sky-High Gas Prices. Heritage Foundation, Ben Lieberman. “Bills have been introduced authorizing the Environmental Protection Agency (EPA) to regulate hydraulic fracturing under the Safe Drinking Water Act. This could greatly reduce future onshore drilling for oil (and even more so for natural gas), thus lowering domestic supplies and adversely impacting gasoline prices. … It has been widely used for decades and is necessary for the majority of new wells in the U.S. It is currently regulated at the state level, and its environmental and public safety track record is nearly spotless. Nonetheless, proposed legislation seeks new federal regulation by the EPA based on concerns about contamination of drinking water supplies, even though such water contamination has never occurred and is highly unlikely.”

Haynesville Shale fuels interest in sale. Associated Press. “Interest in northwestern Louisiana’s Haynesville Shale contributed to a big auction of mineral rights to state-owned land on Wednesday by the State Mineral Board. The monthly sale drew $7.3 million in bonus payments for 31 leases covering more than 2,621 acres. Twenty of the leases were in Caddo, DeSoto and Red River parishes near the Haynesville Shale, considered 1 of the largest domestic natural gas finds in years. The Mineral Board said leases in those parishes averaged more than $6,500 an acre.”

The economics of natural gas. The Economist. “The big news is that in June the Potential Gas Committee, a semi-official body, revised its estimates of America’s gas reserves, raising them 39% above its assessment in 2006. The biggest part of that boost comes from higher estimates of gas in shale formations, which were formerly difficult and expensive to reach. Advances in horizontal drilling and the hydraulic fracturing of rock have made it possible to get previously inaccessible gas out. Shale gas, according to the committee, accounts for two-thirds of America’s technically recoverable reserves, enough to supply the country for 90 years.”

Energy in Depth: Today’s News

Natural gas industry encourages vehicles to use its fuel. Scranton Times-Tribune. “Speaking during a Times-Tribune editorial board meeting Wednesday, Pennsylvania Marcellus Shale Committee representative Dave Spigelmyer said “the technology is here” for fleet vehicles such as buses or delivery services, including mail carriers, to use natural gas with central fueling points. … Technologies to dispose of wastewater are being developed as companies attempt to reuse as much water as possible, Mr. Scheuerman said. He noted there has been no contamination of groundwater caused by hydraulic fracturing, a process used to break up shale to release natural gas.”

Shale Play Slows in 2009. KATV. “A just-issued report from the Arkansas Oil and Gas Commission, however, shows that 2008 was significantly ahead of 2007 in gas drilling and production. Activity began in the Fayetteville Shale in 2004, increased in 2005 and has continued to rise each year since. The name comes from an outcropping of the underground formation in downtown Fayetteville, but the gas drilling action to date has been in seven counties in central and north-central Arkansas – Conway, Van Buren, Faulkner, White, Cleburne, Jackson and Independence. … Restaurants and motels in these areas have seen sharp increases in business, and housing rentals have been hard to find for some workers. A number of the workers have turned to travel trailers and other campers for living quarters. Another activity linked to the Fayetteville Shale has been the building of a major pipeline from the heart of the gas production in Conway County across northern Faulkner County to White County. It will eventually go to the Mississippi River.”

Interior Secretary Salazar aims to include natural gas in energy policy. Grand Junction Sentinel. “Natural gas will be a part of the nation’s energy policy even while the federal government looks to other fuel sources, Interior Secretary Ken Salazar said Wednesday. “The future of natural gas is very bright,” Salazar told The Daily Sentinel editorial board after he presided over the dedication of the Dominguez-Escalante National Conservation Area. … As a senator from Colorado, Salazar had been critical of the Bureau of Land Management’s leasing of lands on the Roan Plateau for natural-gas drilling. That plan is now the subject of a federal lawsuit and there are efforts to reach a settlement, Salazar said. He ruled out withdrawing the Roan Plateau leases, as he did with 77 contentious leases in neighboring Utah near national parks, because the Roan leases had been signed, giving the buyers a property right he was bound to protect, Salazar said. … Still, he said he expects to open a second round of research-and-development leases for oil shale in the next month or so.”

State Mineral Board lease sale earns $7.3 million. Times-Picayune. “Interest in north Louisiana’s Haynesville Shale contributed to a lucrative auction of state-owned land on Wednesday by the State Mineral Board. The monthly sale drew $7.3 million in bonus payments for 31 leases covering more than 2,621 acres. Twenty of the leases were in Caddo, DeSoto and Red River parishes near the Haynesville Shale natural gas discovery.”

Energy in Depth: Today’s News

PA Congressman: Marcellus Shale Natural Gas Drilling Critical for State’s, America’s Economic Future. Energy In Depth, Congressman Glenn “GT” Thompson. “Clean, safe, responsible, well-regulated Marcellus natural gas production in Pennsylvania has already paid dividends for our region and Commonwealth. According to a recent Penn State study, Marcellus Shale natural gas drilling last year generated 29,000 jobs, added $2.3 billion to the economy and generated $240 million in state and local taxes. For 2009 the estimates are 48,000 jobs, $400 million in tax revenues and economic output will top $3.8 billion. Without the environmentally safe and proven 60-year old drilling process known as hydraulic fracturing, the clean-burning natural gas could not be produced from the Marcellus or any other place in the country. … The Marcellus Shale presents a tremendous opportunity to expand and grow Pennsylvania’s economy, get people back to work, decrease our debt and lessen our dependence on imported energy. I will continue to work to help ensure that happens through maintaining support for the state regulation of hydraulic fracturing, and opposing legislation that would impede Pennsylvania’s safe, clean, and well-regulated development of energy.”

Garfield County commissioner gets into fracking debate with oil/gas rep. Aspen Times. “Kathy Hall, of the Western Slope Oil & Gas Association, told the board of county commissioners on Monday that the procedure known as hydraulic fracturing, or “frac’ing,” is “a very safe process,” and ended up in a short debate with commissioner Trési Houpt on a variety of frac’ing-related topics. Hall said there is an effort by anti-industry forces, using “anecdotal evidence” and “scare tactics,” to convince Congress to create federal rules governing the procedure. Hall urged the BOCC to check out such informational sources as the “Energy In Depth” website, which is sponsored by a consortium of oil and gas producers, “to find the research that is accurate … on frac’ing.” She stressed that the oil and gas industries are “critical” to ending U.S. dependence on foreign energy sources, and that frac’ing as a technological process is vital to the industry’s capacity to get oil and gas out of the ground.”

Brigham shares up after positive Bakken well production results. Reuters. “Shares of oil and natural gas company Brigham Exploration Co rose as much as 24 percent on Tuesday, a day after the company reported promising initial production results from one of its wells in the Bakken shale. Brigham said the Anderson 28-33 well produced about 2,154 barrels of oil equivalent per day (boed) during its early 24-hour flow back period. About 85 percent of production was oil. ‘It means in the Bakken, there is no such thing really as a bad well, there’s just under-exploited wells,’ Jefferies and Co analyst Subash Chandra said by phone. In April, the U.S. Geological Survey estimated about 3 billion to 4.3 billion barrels of undiscovered, recoverable crude oil in the North Dakota and Montana Bakken shale play.”

Eastern Saskatchewan shale gas hunt starting. PennEnergy. “Hunt Oil Co., Dallas, and Nordic Oil & Gas Ltd., Winnipeg, Man., signed a strategic development agreement regarding gas exploration in east-central Saskatchewan. Nordic will have the opportunity to earn an interest in 153,600 acres of Hunt-owned land at Preeceville, 130 miles northeast of Regina, Sask. The ensuing exploration work on the lands will result in Hunt having the option to participate on a 50-50 go-forward basis with Nordic, or allow Nordic to retain a 100% interest in the land with Hunt earning a gross overriding royalty.”

Energy in Depth: Today’s News

Houpt, gas industry rep debate FRAC Act issues. Glenwood Springs Post Independent. “Kathy Hall, of the Western Slope Oil & Gas Association, told the board of county commissioners on Monday that the procedure known as hydraulic fracturing, or “frac’ing,” is “a very safe process,” and ended up in a short debate with commissioner Trési Houpt on a variety of frac’ing-related topics. Hall said there is an effort by anti-industry forces, using “anecdotal evidence” and “scare tactics,” to convince Congress to create federal rules governing the procedure. Hall urged the BOCC to check out such informational sources as the “Energy In Depth” website, which is sponsored by a consortium of oil and gas producers, “to find the research that is accurate … on frac’ing.” She stressed that the oil and gas industries are “critical” to ending U.S. dependence on foreign energy sources, and that frac’ing as a technological process is vital to the industry’s capacity to get oil and gas out of the ground. … “We try really hard, especially states in the West, to regulate our own lives,” said Hall, challenging Houpt to “show me one time” where federal regulations had greater benefits to the public than state regulations.”

The Marcellus effect. Sublette Examiner. “One mile below Broome’s verdant soil lays the world’s largest unconventional natural gas field. A recent Pennsylvania State University study found a gas rich formation called the Marcellus shale might contain 489 trillion cubic feet of natural gas. That is enough methane to meet the nation’s gas needs for more than a decade. … Locked in a layer of impermeable shale and irrecoverable just years ago, Marcellus gas is being liberated using recent advances in hydraulic fracking and drilling, much of which was honed in Sublette County. The new technology has made Marcellus shale one of the nation’s most talked-about and promising domestic energy sources. … Last week, New York State legislators labored over a bill to regulate the essential process of hydraulic fracking. … That bureaucratic disharmony, according to Doll, acts as a disincentive for companies to develop the Marcellus play. … Some estimates claim New York and Pennsylvania could each gain 98,000 new jobs during the Marcellus development stage.”

Mystery from flammable water solved, sort of. Greely Tribune. “David Neslin, director of the Colorado Oil and Gas Conservation Commission told members of the commission that nearby gas wells have been replugged, and tests showed that methane gas was not to blame in flammable water in a Fort Lupton-area home. The problem with Amee Ellsworth’s home, about 10 miles northeast of Fort Lupton, started last fall when the tap water in her home would catch fire when a flame was held nearby. … “We don’t believe there is a current leak or problem that endangers public safety,” he said. Neslin said the owner of the wells installed a water-treatment system on the water wells, and that should clear up problems that attracted national attention when tap water in nearby homes caught fire. Anadarko Petroleum Corp. and Noble Energy Inc., which own gas wells near the home, also tested the wells and haven’t found where the gas is coming from. State health officials have said the levels of methane gas in the water aren’t high enough to cause health problems. Neslin said there is a history of naturally occurring methane in groundwater in Weld, but further studies may be needed to determine the source of the current problem.”

Clean-Energy Summit: You Want Clean Energy? Shale Gas. Wall Street Journal. “There’s another “clean energy summit” going on, this time out in Las Vegas, with all the usual suspects from Sen. Harry Reid to former vice president Al Gore hashing out ways to usher in the clean-energy revolution. … John Podesta, the head of the think tank Center for American Progress, twice cited the potential of natural gas-not just any gas, but “shale gas” extracted from underground rocks-to replace “dirty coal.”

Paterson offers draft energy plan. Ithaca Journal. “Gov. David Paterson on Monday released a draft of a state energy plan that aims to make New York a clean-energy state, labeling the Southern Tier’s Marcellus Shale natural gas reserve as a possible source of fuel. “We need to make energy more affordable for New Yorkers, and we need to do it in a way that recognizes that the country is moving towards a carbon-constrained economy,” Paterson said in a statement. … New York imports more than 95 percent of its natural gas from the Gulf Coast and Canada, with 5 percent being produced in-state. The Marcellus Shale is estimated to have roughly 50 trillion cubic feet of natural gas reserves, but it is unclear how much is accessible in New York. Paterson estimates that tapping into the Marcellus Shale and implementing other clean energy-related plans, such as restructuring 1 million homes to make them energy efficient, will create new jobs.”

Energy in Depth: Today’s News

Drilling restriction would hinder natural gas exploration. Press & Sun-Bulletin, Greater Binghamton Chamber of Commerce president & CEO. “At a time when our country is desperately seeking to become more energy-independent and our region is struggling to launch its own natural gas development industry sector, it is ironic that some in Congress are attempting to further restrict our domestic energy production by attacking a decades-old technology that provides 30 percent of the nation’s oil and natural gas supplies. … U.S. Rep. Maurice Hinchey, D-Hurley, one of our area members of Congress, along with a couple of his colleagues, recently introduced the FRAC Act – Fracturing Responsibility and Awareness of Chemicals Act – a bill which would, in effect, take a long-established and safe drilling technology called hydraulic fracturing and redefine the process as some kind of health threat while severely restricting the ability to use it. … The proponents of the FRAC Act can’t cite any evidence to support their environmental and health hazard claims, so they’re resorting to scare tactics to justify this unnecessary, bureaucratic grab that will further jeopardize our domestic energy resources. We urge Hinchey and his colleagues to withdraw this bill, and, as Colorado’s governor recommends, get the facts first.”

Fracturing gets a boost. The Oklahoman, Oklahoma Corporation Commission chairman. “As adopted by the 50-state National Association of Regulatory Utility Commissioners (NARUC), the resolution supports continued state regulation of hydraulic fracturing, a completion technique used in the majority of oil and gas wells. This is the first resolution I have proposed in my 20 years on the NARUC Gas Committee. Another principal author is Dana Murphy, Oklahoma’s newest corporation commissioner, who has more than 20 years of experience as a geologist and attorney. … This isn’t a new technology, but one that has been used successfully to complete Oklahoma oil and gas wells for 60 years in tens of thousands of applications with no known cases of drinking water contamination. … Oklahomans know state regulation can best deal with differences in geology, hydrology, climate and local water availability. Now, so does NARUC.”

Canada’s Horn River Basin has natural gas producers envisioning another Barnett Shale. Fort Worth Star Telegram. “The Dallas-Fort Worth area and Canada’s remote Horn River Basin are more than 2,300 miles apart, but there’s nevertheless a significant new link between the two highly diverse regions. Horn River, in a heavily forested area of northeast British Columbia where subzero temperatures are commonplace, is now drawing comparisons to North Texas’ Barnett Shale, a hotbed of drilling activity recently cited as the biggest natural gas-producing field in the United States. There’s increasing talk that Horn River, scene of a budding natural gas play attracting major oil industry players, could become another Barnett Shale in terms of headline-making gas production. The two regions have very similar geologies, and both are “unconventional” gas plays requiring advanced horizontal drilling techniques and extensive hydraulic fracturing to make them economically attractive.”

Savant aims to finish Badami well. Petroleum News. “Division Director Kevin Banks wrote that Savant “is a capable third party based on its experience drilling an Alaskan exploration well and applying new fracturing technology in low permeability shales.” Savant plans to combine horizontal drilling with hydraulic fracturing – pumping large volumes of fluid into the ground to crack the formation – to try to improve Badami’s oil flow. Hydraulic fracturing has been tried before at Badami, but only on traditional vertical wells.”

Recent incidents raise issues on drilling, environment. Shreveport Times. “On the national stage, a bill has been introduced in Congress to remove exemptions given oil and gas operators related to the process of hydraulic fracturing and its impact on water sources. Removing the exemption could heavily impact operators in the Haynesville Shale, since almost all of the drilling here involves “fracking.” The lengthy permitting process could be costly to companies and delay drilling. U.S. Rep. John Fleming, R-Minden, has said he opposes such legislation, since there are no documented cases of anyone becoming sick from fracking water contaminating drinking water sources. However, environmental advocacy groups say there is anecdotal evidence of contamination and more stringent oversight is needed.”

Marcellus activity sizzles while Barnett interest fizzles. Fort Worth Business Press. “If there’s a lesson to be taken from the latest round of earnings reports from oil and gas exploration and production companies, it’s this: the Marcellus Shale is the place to be. Many of the Barnett Shale’s biggest operators are shifting resources toward what they see as an amazing opportunity in the Appalachian Basin play, which runs through parts of New York, Pennsylvania and West Virginia. It appears the core area – the richest area – is in southwestern Pennsylvania. “The Marcellus is the biggest of the shale gases in the United States,” said Terry Engelder, a professor in the Department of Geosciences at Penn State University.”

Energy in Depth: Today’s News

Gas company hopes to reduce its ‘footprint’. Williamsport Sun-Gazette. “Officials from Houston-based Anadarko Petroleum Corp. said they are confident the development of natural gas in the Marcellus Shale formation in central Pennsylvania – specifically in a three-county area – will have a positive financial impact on the state and the company. … “It is our hope that our production of gas resources will have a great benefit for the commonwealth and our shareholders.” … The Snow Shoe site has yet to be hydrofractured, which is the process in which pressurized water, sand and chemicals are pumped into the well to pulverize the shale and release the gas trapped within it. … By using the rig, the company will be able to drill up to six horizontal wells from a single well pad, Carmichael said. Drilling multiple horizontal wells from a single pad will allow the company to drain a much larger area than a single vertical well pad, thus reducing the overall “footprint” on the landscape, said Michael J. Beattie, company geoscience manager for the Appalachia region. The technique not only reduces the number of well pads that have to be built but also reduces the number of service roads needed to maintain well sites, he said.”

DEC has studied enough; it’s time to move ahead. The Post-Standard, Barbara Fiala, Broome County executive. “As Broome County executive, I have tried to balance the competing views surrounding the Marcellus shale. I believe it is possible to develop natural gas resources and to also provide reasonable protection for the environment. Development, however, is currently held hostage by New York state government. … Development of the Marcellus shale presents an enormous economic opportunity. Broome recently commissioned a study to assess the fiscal impact of natural gas development. The preliminary draft indicates that the 10-year “total economic activity” in Broome County will be in the billions of dollars. The economic benefits for the state, including tax receipts, will be even greater. This opportunity is presented at a time when our economy is suffering. … In today’s economic climate, we could lose economic development entry opportunities for decades. Natural gas companies are planning for the next five years, and I fear they are looking elsewhere. On behalf of Broome County, we request that DEC immediately release the draft sGEIS, set the necessary comment period and move this process forward.”

Study: Utah netted more than $370 million from oil and gas drilling in 2007. Associated Press. “A University of Utah study shows that in 2007 the oil and gas industry paid Utah and one of its state agencies more than $370 million. Most of the money came from the lease of federal lands in Utah for drilling. That produced $310 million in shared royalties, fees and taxes for the state. The Utah Institutional and Trust Lands Administration collected its own revenue by leasing state lands for energy development. That figure totaled $63 million. Oil and gas drilling was booming in 2007 but has since tapered off with a decline in energy prices. The calculations were made by researchers at the U.S. Bureau of Economic and Business Research.”

More natural gas industry-related business on way. Williamsport Sun-Gazette. “Another business related to the natural gas drilling industry is coming to a location near here this fall, following action at a Delmar Township zoning hearing board meeting. Arthur Stewart, owner-operator of D and I Silica, headquartered in Sheffield, approached the board with a request for a special exception to operate a hydrofracturing sand trans-loading facility on 6.5 acres on Dresser Road near the railroad grade, about one half mile north of the Tioga Central Railroad excursion train station. … The $1 million project eventually will include up to 12 silos, 1,500 feet of track and high speed unloading equipment, Stewart said. “Frac sand, mined in Wisconsin and Illinois, is different from regular sand in that it is stronger, round and dust-free,” Stewart added. To preserve the quality of the sand, it is handled carefully during every step of its journey to its destination, he added. “During the process, it is washed, sorted and run through a system to segregate out the dust so it is pure sand, dust would be as bad for the well as it would be for the community,” Stewart said.”

Energy in Depth: Today’s News

Hydraulic fracturing safe, reliable. Elmira Star-Gazette, Lee Fuller. “To read Steve Coffman’s July 27 Guest Viewpoint on hydraulic fracturing is to understand why an energy technology that’s been around for 60 years, applied more than 1.3 million separate times, and deployed without a single incident of drinking water contamination finds itself under attack today. Chalk it up to misinformation. The writer blames hydraulic fracturing for everything from noise pollution to nuclear radioactivity. Along the way he claims that fracturing enjoys a special exemption under current law. Not a single one of these assertions is true. Here are the facts: Hydraulic fracturing has helped bring more than 600 trillion cubic feet of U.S. natural gas to American markets – gas that’s among the cleanest, most reliable and most tightly regulated energy sources available. And thanks to fracturing, we harvest that gas without having to drill as many wells – limiting our land disturbance, while producing a resource that promotes cleaner air, cleaner water and a healthier environment.”

Seward seeks more time for drilling review. Ithaca Journal. “State Sen. James Seward, R-51st Dist., has asked the Department of Environmental Conservation to extend the public comment period on the draft Generic Environmental Impact Statement for natural gas drilling applications, he announced Tuesday. … “Utilizing the tremendous energy resources in the Marcellus Shale formation could play a significant role in helping us to reduce our dependence on foreign oil while at the same time providing a boost to the local economy. That being said, environmental protections must be in place and local governments need to be properly informed of drilling activities,” Seward said.”

Energy in Depth: Today’s News

Natural gas ‘hydrofracking’ holds promise, peril. Syracuse Post-Standard, Editorial. “The rich natural gas deposits beneath Central New York present a rare opportunity for large-scale economic development. They also present the specter of environmental degradation across a wide swath of the region. The key to extracting trillions of cubic feet of gas from the area’s shale formations hinges on a controversial horizontal drilling technique called hydraulic-fracture drilling — or hydrofracking. Millions of gallons of water, sand and chemicals are forced underground at high pressure, fracturing the bedrock and releasing the gas. … A safe and responsible method of harnessing the region’s enormous natural gas resources could be a boon for the area. It’s well worth taking the time to make sure it is done right.”

Is Shale Gas the Climate Bill’s New Bargaining Chip? New York Times. “Natural gas from shale formations is the new magic phrase in the oil and gas industry, as new technologies have led to stunning increases in potential resources and anticipated profits. … With new discoveries of the fossil fuel in massive but difficult to drill shale deposits, advocates claim that climate legislation means a job boom for gas engineers and drillers, and revenue for producers. They say a cap on greenhouse gas emissions could lead power plants to switch to gas from coal, which emits about double the carbon dioxide of gas. Some experts — but not all — say that a strong mandate to expand wind power and other alternative energy generation could be a boon for natural gas generators, which are a likely future source of backup power for renewables. … “If you took a map of swing-state senators and look at where these new gas finds are, they match,” said Sen. Mark Udall (D-Colo.). “It’s more than ironic.” … “Natural gas is best” for that role, said Jeffrey Eshelman, vice president of public affairs of the Independent Petroleum Association of America. “It’s abundant. It’s a natural backstop for renewable energy. It makes all the sense in the world to bring all of it online.”

A Homegrown, Shovel-Ready Green Jobs Program – That Will Work! RedState. “The U.S. has almost unlimited resources of NATURAL GAS. It is a clean, abundant and secure fuel: its source is almost entirely domestic. At today’s prices, it deliver a unit of energy at a third of the cost of oil and with about half of the carbon footprint per unit of energy as oil or coal. We have existing transportation infrastructure in place covering nearly the entire country. Advances in drilling and production technology have unlocked the natural gas potential of shales, rock formations long believed to be non-productive. Industry’s recent success in producing natural gas from other shale formations (especially the Barnett Shale of Texas, the Haynesville of Louisiana, the Fayetteville of Arkansas, and others) has opened up the biggest, highest-potential natural gas play in the Eastern U.S., one that covers much of Western Pennsylvania: the Marcellus Shale.”

Energy in Depth: Today’s News

NARUC backs regulation of hydraulic fracturing. Oil & Gas Journal Newsletter. “State utility regulators approved a resolution at their summer convention in Seattle urging Congress to leave regulation of hydraulic fracturing to the states. The resolution by the National Association of Regulatory Utility Commissioners’ gas committee said the organization “has observed with great concern the current debate in Congress over the appropriate method for regulating the use of hydraulic fracturing to complete oil and gas wells.” US Reps. Diana DeGette (D-Colo.) and Maurice D. Hinchey (D-NY) introduced a bill on June 4 which would bring the process, which is used to recover gas from shale formations, under the Safe Drinking Water Act. US Sen. Robert P. Casey Jr. (D-Pa.) introduced similar legislation in the Senate the same day. Doing so, NARUC’s resolution said, “would add burdensome and unnecessary regulatory requirements to the drilling and completion of oil and gas wells, thereby increasing costs of producing domestic natural gas resources without any ancillary benefit to public health, safety, or the environment.”

Contamination doesn’t come from fracking. Greeley Tribune, LTE. “Hollis Berendt’s column on water quality issues is misinformed. The benzene contamination that was discovered by a land developer near “unreclamated (sic) wells” most assuredly has nothing to do with fracking. Diesel, benzene and industrial solvents are not frack fluid additives in the Wattenberg Field. Moreover, fracking occurs at depths of more than 7,000 feet and is not connected to surface contamination. The contamination is certainly due to a past spill of condensate or leak from a pipeline.”

Tight Sands Natural Gas: An Ignored and Promising U.S. Energy Frontier. Seeking Alpha. “The 4 frontier plays are coal bed methane, shale gas, ultra deep water and tight sands (TS) gas. Together these plays account for nearly half of all gas produced in the US and it is expected that they will account for the decisive majority of US gas production as the next decade begins. … There are about 20 TS gas basins in the US. There is an overlap but no coincidence of TS and shale gas basins. Much of the resource delineation work has been concentrated in the Great Plains, Rocky Mountains, the Four Corners region, onshore Gulf Coast and Arkansas/Oklahoma (i.e. the usual gas provinces). However, with the dramatic growth in the knowledge about the vast Marcellus shale basin in Appalachia, resource delineation for TS gas in Appalachia has also begun.”

Energy in Depth: Today’s News

Hydro fracturing fears ring untrue. Elmira Star Gazette, Brad Gill. “Drilling and hydraulic fracturing are two distinct processes. Both have been performed safely in New York for decades. The impacts of hydraulic fracturing are already being scrutinized by the state Department of Environmental Conservation as it prepares an environmental impact statement on the process. … In addition, the fluid will not be stored in pits at the drill sites for long periods of time, and it will not “likely leech into the ground,” as the letter suggests. The DEC doesn’t allow it, and the oil and gas industry would never allow it. Suggesting either process will release acid or radiation into the environment or impact the ozone is just plain wrong. … My hope is that New Yorkers will remain engaged in the debate and base their opinions on the facts, data and science of credible sources.”

States should make ‘fracking’ rules. The Dickinson Press, Editorial. “Eliminating hydraulic fracturing would eliminate the possibility of extracting most oil from the Bakken and Three Forks-Sanish oil formations. The process of fracturing is already the object of intense scrutiny in our state by the North Dakota Department of Mineral Resources. The industry is correct that there has never been a problem with groundwater from fracturing in North Dakota. … So, in fact the chemicals used in fracturing are open to governmental review, just not the mix. Add to that there are two layers of steel and concrete and 2,000 feet of natural shell between oil shale and well water in North Dakota serves as a natural buffer, as well. Oil fields like the Bakken and Three Forks-Sanish hold unlimited economic potential for or state. Creating barriers that would eliminate extraction of oil and natural gas would certainly not be in the best interests, but neither is the catastrophic disaster that would be contaminating state aquifers. All oil producing states are not the same geologically and creating new one-size-fits-all national regulations doesn’t make sense. Since states are not equal geologically, then if legislation is required, it should be determined by each state.”

Drilling method defended. The Oklahoman. “A new study from Penn State University says the Marcellus shale natural gas play in Pennsylvania generated $2.3 billion in “value added” for the state last year, including 29,000 jobs and $240 million in state and local taxes. Development is expected to pick up this year and, by 2020, the play could be responsible for 175,000 jobs. The study warns that a congressional proposal for federal regulation of hydraulic fracturing would, if enacted, “be disastrous in terms of the domestic oil and gas industry, raise prices for gasoline and natural gas and ultimately derail any efforts to address the need to reduce carbon emissions.” … Some lawmakers concerned about the method say it could contaminate the water supply. Sen. Jim Inhofe, R-Tulsa, and Sen. Byron Dorgan, D-N.D., argued on the Senate floor last week that there has been no evidence hydraulic fracturing has contaminated any water supplies.”

Make way for drilling. Press & Sun-Bulletin, LTE. “Marcellus Shale will provide the greatest opportunity for economic energy growth in the country, and our area – Northeast Pennsylvania and the Southern Tier – through jobs and low-cost fuel. We have a problem with Reps. Maurice Hinchey, D-Hurley, and Chris Carney, D-Dimock Township, and other liberals in Congress who oppose development of our land-based, natural energy resources. … If Congress writes legislation restricting the timely development of natural gas deposits, using extreme environmental laws and fear that use, as a cover, the contamination of drinking water, it will destroy or delay use of our local natural gas resources.”

Political fracture over oil extraction affects Colorado. Denver Post. “The battle is now focused on a bill in Congress – co-sponsored by two Colorado Democrats, Reps. Diana DeGette and Jared Polis – to put the process under the federal Safe Drinking Water Act. Hydrofracturing pumps millions of gallons of fluids into wells under high pressure to crack deep rock strata and release natural gas. For industry, fracking is the key to unlocking vast reserves, while environmental groups say it is a pollution threat to groundwater. Fracking was exempt from regulation under the Bush administration’s 2005 Energy Act. … But Colorado Gov. Bill Ritter has called on DeGette to go slow on the bill and seek more study. “I don’t for a moment discount the concerns of those who worry about protection of drinking water,” Ritter said last month at a Colorado Oil and Gas Association meeting. “But I also believe that we have to understand the problems and the risks before we act.” … Five Colorado counties have passed resolutions supporting the bill, and six have passed resolutions opposing it. For so-called unconventional gas plays, or reservoirs, such as Colorado’s tight sands, fracking is crucial and has dramatically boosted U.S. gas reserves. … The DeGette bill would require disclosure of the constituents of fracking fluids, but not the formula, to the states or the EPA. But the question that most concerns industry and state regulators is what other regulations there might be under the Safe Drinking Water Act.”

North Dakota may have another big oil field. Associated Press. “Dozens of fruitful wells beneath the rich Bakken shale in North Dakota continue to fuel a hunch among oilmen and geologists that another vast crude-bearing formation may be buried in the state’s vast oil patch. Lynn Helms, director of the state Department of Mineral Resources, said recent production results from 103 newly tapped wells in the Three Forks-Sanish formation show many that are “as good or better” than some in the Bakken, which lies two miles under the surface in western North Dakota and holds billions of barrels of oil.”

Energy in Depth: Today’s News

Natural Gas and Plenty of It. Huffington Post, T. Boone Pickens. “A decade ago it was common knowledge that natural gas reserves were declining and consumption was maintaining at steady levels. Then advanced drilling technologies — especially horizontal drilling and using fracking techniques to recover natural gas from shale formations — which were previously impervious to drilling came online. The Barnett field in Texas was the first major natural gas play using the new techniques. On its heels came what Stratfor calls “the gigantic Marcellus Shale that underlies the Appalachian Mountains.” In addition to the large Marcellus deposit, two more exist in Fayetteville, Arkansas and Haynesville, Louisiana. According to Stratfor, Haynesville is “claimed to be the fourth-largest natural gas field in the world.” … Natural gas is a big part of the solution to our economic, environmental, and national security problems. We have plenty of natural gas. All we need now is the national will to make appropriate use of it.”

Landowners to rally for gas drilling. Press & Sun-Bulletin. “Landowners from throughout the Southern Tier, many of them farmers, plan to rally in Bainbridge in support of natural gas development. The event is scheduled for noon Aug. 23 at General Clinton Park. It’s intended to send this message to local, county and state elected officials: “There is a great opportunity here,” said Bryant LaTourette, a landowner and event organizer from Chenango County. “I don’t think everyone understands that. Landowners are true environmentalists … This industry has a great record.” … But more than 48,000 people in eight counties, including Broome, are represented in landowner coalitions that organized to leverage influence in the debate over natural gas development and negotiations with energy companies. … Before the deal can be finalized, however, the state Department of Environmental Conservation has to complete a review to address environmental concerns and update regulations governing the type of drilling used for the Marcellus Shale. It involves drilling horizontally through the bedrock, and using large volumes of chemical solutions to fracture the shale and release natural gas.”

Chesapeake Continues Gas-Production Increase. Wall Street Journal. “Chesapeake Energy Corp. is continuing to increase its production of natural-gas, despite low prices and growing oversupplies. … Chesapeake saw some of its biggest production gains in the Haynesville Shale, a massive natural-gas field in northern Louisiana and East Texas that the company discovered last year. Chesapeake’s production there grew 85% in the second quarter from the first quarter. Recently discovered fields such as the Haynesville Shale have seen continued drilling activity in recent months, even as drilling has slowed in most other areas, because improved production techniques have made the newer wells profitable at low prices.”

Natural gas plant gets initial approval. Boston Globe. “A state board yesterday approved plans to build a natural gas plant in Brockton, but left local officials with the power to veto the plant’s construction by choosing whether to grant the zoning exemptions needed to build the 350-megawatt facility. The state Energy Facilities Siting Board, a division of the Massachusetts Department of Public Utilities, did not grant the exemptions because it “concluded that the proposed project’s environmental and energy supply benefits do not outweigh expected local impacts,” according to a statement. The $350 million plant, which would be fueled with natural gas and ultra-low sulfur diesel, has been under fire from some residents concerned about health and safety. … The plant is expected to generate 25 permanent jobs and 300 construction jobs over two years.”

Protesters rally against wells. Denton Record Chronicle. “Fort Worth-based Range Production Co. is asking the council for a special-use permit to allow gas drilling on 3 acres inside the planned Rayzor Ranch mixed-use development, located on both sides of U.S. Highway 380 between Interstate 35 and Bonnie Brae. The site is north of a hospital and retirement community and within several hundred feet of the city park and homes. The thought of drilling so close to a park and homes is “absurd,” said Charles Grand, a college student who attended the rally as a representative of the International Socialist Organization’s local chapter. Grand said the city government would profit from the drilling through taxes and permit fees, but at the expense of public health and safety. “Things like this are happening across the country,” he said. “The question is, what is the city going to do about it?”

Energy in Depth: Today’s News

NARUC backs continued state regulation of hydraulic fracturing. PennEnergy. “State utility regulators approved a resolution at their summer convention in Seattle urging Congress to leave regulation of hydraulic fracturing to the states. The resolution by the National Association of Regulatory Utility Commissioners’ gas committee said that the organization “has observed with great concern the current debate in Congress over the appropriate method for regulating the use of hydraulic fracturing to complete oil and gas wells.” US Reps. Diana DeGette (D-Colo.) and Maurice D. Hinchey (D-NY) introduced a bill on June 4 which would bring the process, which is used to recover gas from shale formations, under the Safe Drinking Water Act. US Sen. Robert P. Casey Jr. (D-Pa.) introduced similar legislation in the Senate the same day. Doing so, NARUC’s resolution said, “would add burdensome and unnecessary regulatory requirements to the drilling and completion of oil and gas wells, thereby increasing costs of producing domestic natural gas resources without any ancillary benefit to public health, safety, or the environment.”

Drilling for Natural Gas: A Godsend for Pike County? Pike County Press. “A Pike County man, whose surname over the years has become nearly synonymous with recreation on the Upper Delaware River, is completely in favor of drilling locally for natural gas, including associated water withdrawals from the river. He believes the future health of our river, its watershed, as well as our entire local economy, depend upon it. … ‘The information that we are getting from area newspapers is not based on science, it’s based on opinions,’ said Jones. ‘It’s giving the gas industry a bad name and has scared a lot of people unnecessarily.’ … Jones added, ‘The Marcellus Shale Formation is located more than a mile down; more like 7,000-feet below the surface here in Pike County. Typical water wells here are less than a thousand feet deep; I don’t think there will ever be a problem with this fracking fluid entering the aquifer.’”

Gas drilling concerns want to know what the hold up is. Evening Sun. “The low drone from drilling rigs can still be heard through the hills and dales of Smyrna, landmen have begun to infiltrate further north into Madison County and rumors are flying about more lease deals coming to Broome County property owners. All that activity should be enough to spur state lawmakers into completing the Marcellus Shale permitting process, a group of Chenango County supervisors say – not to mention the constant bombardment of communiqué over the Internet from local government officials, environmentalists, landowner coalitions and natural gas industry lobbyists. The New York State Department of Environmental Conservation is supplementing its environmental regulations for hydrofraking permits in the natural gas rich Marcellus Shale. … “Very simply, what else is in New York? This is an opportunity that is almost certain,” Chenango County Supervisor Peter C. Flanagan, D-Preston, and chair of the county’s special committee on natural gas, said Tuesday.”

Billionaire touts clean energy, gas at chamber banquet. Lancaster Newspapers. “Self-made billionaire T. Boone Pickens always could get an audience with federal lawmakers in Washington, D.C. They liked his deep pockets, he said. But it wasn’t until the past year, when he’s garnered the support of 1.6 million citizen members of his New Energy Army, that those lawmakers started listening to him, he said. … And as natural gas plays a bigger role in transportation, Pickens said, Pennsylvania will be comparable to California during the gold rush of the 1840s. “You are probably going to have the largest gas field in the United States – the Marcellus,” he said. The Marcellus Shale lies under much of Pennsylvania, New York and West Virginia. Geologists have long known the shale holds a wealth of natural gas, but only in recent years has the technology been developed to tap into this deep-seated reservoir. “My advice to you is to take it, bless it, love it, make everything you can off it,” Pickens said of Pennsylvania’s Marcellus gas reserves.“

Energy in Depth: Today’s News

Concern for natural gas drilling continues. Utica Observer-Dispatch. “As the state continues to work on new regulations for a controversial natural gas drilling practice that would be used to develop the Marcellus Shale, environmental advocacy groups are concerned regulations will not go far enough in protecting local environments. And one of those groups, Otsego 2000, is calling for a moratorium on a drilling practice known as horizontal hydraulic fracturing in the Lake Otsego Watershed and Otsego County. … “Hydraulic fracturing has been in commercial use for 60 years, has been deployed more than 1.3 million times, and has not once been found to contaminate drinking water,” said Chris Tucker a spokesman with Energy in Depth, an advocacy group that represents independent oil and gas producers across the country. “It’s expected to create 50,000 jobs next year in Pennsylvania alone. And it can do the same thing for New York, in a much safer and more efficient manner than any of these anti-energy groups would want you to believe.”

Marcellus Shale = 176,000 jobs. Leader Vindicator. “A Penn State study says Marcellus Shale natural gas extraction and development will pump $14.17 billion into the state’s economy next year and create more than 98,000 jobs, while generating $800 million in state and local tax revenues. Over the next decade, as many as 176,000 new jobs could be created. … The study notes a consistent increase in annual drilling and projects a $25 billion contribution to the state’s economy by 2020. That level of activity would generate almost $1.4 billion in state and local tax revenue and create more than 176,000 new jobs. … “This study validates what is being experienced in my district and in other communities around the state where drilling in the Marcellus Shale has taken a foothold, focusing on real economic growth and good jobs for people in a number of fields,” state Rep. Tim Solobay, D-Washington, said.”

Natural Gas Drilling Could Create Billions For Broome. WBNG-TV. “A natural gas boom could bring billions of dollars to Broome County. A preliminary study shows the potential economic impact of drilling into the Marcellus Shale. As Action News Reporter Julianne Sweeney tells us, the estimates cover everything from the driller to the retailer. This preliminary report points to billions of dollars in Broome County’s future. It studies only economic impact of natural gas drilling into the Marcellus Shale. … “This is something that can truly infuse a lot of capital into our region.” said Darcy Fauci of Broome County Economic Development. The report finds gas companies could spend $7 to 15 billion dollars to develop gas fields in Broome, depending on the number of wells. In turn it would generate hundreds of jobs on field sites. And then create millions in local sales revenue if companies purchase equipment and supplies locally. “The drilling will have a ripple economic effect and everyone should benefit.” said Broome County Attorney Joe Sluzar. There will also be an indirect impact, adding another 2 billion to 4 billion into the economy.”

Millions In Gas Drilling Revenue For Broome. FOX 40 News WICZ TV. “Broome County’s gas drilling study shows how much the county has to gain economically from drilling in the Marcellus Shale…but the county’s still awaiting word from the state about when drilling can go forward. County Executive Barbara Fiala says the millions of dollars in revenue the county could gain from drilling could be used to ease the burden of taxes on the county’s eroding tax base. … “This is a lot of revenue for New York State, not just Broome County.  It’s additional revenue for the state, and we would like to make sure that they actually stick to their schedule this time, not keep moving it further and further,” said Barbara Fiala, (D) Broome County Executive.”

Exxon sees natural gas potential with new drilling technique. Dallas Morning News. “Dozens of workers mill around a jumble of pipes and whirring equipment surrounding 10 natural gas wells operated by Exxon Mobil Corp. … “We’re about 15 minutes away from a new frac being born,” Randy Tolman, Exxon’s project coordinator for the Piceance Basin, shouts over the noise. He invented this faster method of fracturing, or “fracing,” the underground layers of rock and sand to unlock natural gas. Exxon aims to export the new process to the unconventional natural gas reserves it is accumulating around the world. Drilling for more natural gas could make Exxon a lot of money as Americans demand cleaner fuel because natural gas doesn’t emit as much pollution or greenhouse gases as oil and coal when burned. “It’s the bridge fuel,” said Amy Jaffe, associate director of Rice University’s energy program, adding: “It’s going to be a 20-year bridge. … In the 1980s, frac jobs could take months. Now a complicated frac typically takes a couple of weeks. Exxon’s Tolman developed a method to fracture a Piceance Basin well in three days, and he thinks he can compress it to 24 hours.”

DEC Gas Drilling Report Delay Frustrates. FOX 40 News WICZ TV. “The preliminary report, released just yesterday, cites the Southern Tier as the hottest area for gas drilling in the entire country — promising a multi-billion dollar payoff over the next decade. But whatever the merits and accuracy of that report might be, no drilling can begin until the state releases its own report: an environmental impact statement on gas drilling. Frustrating for those, like Joint Landowners Coalition Member Dave Fendwick, who wants gas drilling to begin before it’s too late. “Possibly could pull our chances of having this gas development come here. Because it could go to other areas–we are in competition with other areas,” said Joint Landowners Coalition Member David Fendick. … “The Binghamton Sustainability Commitee, the Sierra Club–they’re just telling people fallacies about what’s occurring with the gas drilling. This is a different geographic area.  The environment’s totally different. It’s a different type of shale play–and they’re just trying to put fear into people,” said Fendwick.”

Gas fields cushion recession’s impact on Tarrant County. The Dallas Morning News. “The natural gas boom couldn’t prevent Tarrant County from feeling the recession, but it has cushioned the financial blow. Property values released this week by the Tarrant Appraisal District show an increase of 1.8 percent despite the bad economy. Subtracting the gains from the Barnett Shale gas field would have cut that increase by 80 percent. … “The Barnett Shale and some growth Tarrant County saw in terms of new construction has helped the county stay on the positive side of growth,” said chief appraiser Jeff Law.”

Energy In Depth: Today’s News

Marcellus Shale estimated natural gas yield rises to nearly 500 trillion cubic feet. Pittsburgh Tribune-Review. “New calculations show the Appalachian Basin’s Marcellus Shale formation could yield enough natural gas to supply all U.S. needs for nearly two decades – dramatically more than previous estimates. Penn State University geosciences professor Terry Engelder projects nearly 500 trillion cubic feet of natural gas could be produced from the entire formation, which is found in portions of five states, including most of Pennsylvania. Engelder published his latest estimate in the August issue of Fort Worth Oil and Gas Basin magazine. “If the natural gas from the Marcellus could be extracted on demand, the Marcellus alone would last the U.S.A. more than 19 years, producing 489 trillion cubic feet of gas,” Engelder said Monday. … The Penn State report found that all Marcellus Shale-related development statewide in 2008 generated $2.3 billion in economic impact, created more than 29,000 jobs and paid $140 million in state and local taxes.”

NARUC formally adopts resolution opposing federal regulation of fracking. Platts. “The National Association of Regulatory Utility Commissioners on Wednesday formally adopted a policy opposing federal regulation of hydraulic fracturing, asserting that states are fully able to “properly regulate” oil and gas production within their borders. Pending legislation would repeal a section of the Energy Policy Act of 2005 that exempts fracking from regulation under the federal Safe Drinking Water Act. … A resolution opposing federal regulation was approved earlier this week by NARUC’s gas committee and subsequently endorsed by NARUC’s board at its summer meetings in Seattle. Oklahoma Corporation Commission Chairman Bob Anthony, who sponsored the resolution, noted that his agency has handled “tens of thousands of applications” involving fracking and there has been “no single instance” of groundwater degradation. The American Petroleum Institute released a study earlier this month warning that federal regulation of the drilling technique, commonly used to extract shale gas, could cost the US economy as much as $374 billion in 2014 alone while making the country far more dependent on foreign energy.”

Inhofe Responds to Attacks on Hydraulic Fracturing. U.S. Senator James Inhofe (R-Okla.), Ranking Member of the Senate Environment and Public Works Committee, today delivered a floor speech highlighting the nation’s vast reserve of energy resources recoverable through hydraulic fracturing techniques. Inhofe praised the fracturing industry for its impressive job growth and flawless safety record. The 60 year old technique, which has been responsible for 7 billion barrels of oil and 600 trillion cubic feet (Tcf) of natural gas, is under fire from several federal and state representatives who claim the practice endangers drinking water sources. Today, Inhofe set the record straight on a number of falsehoods concerning hydraulic fracturing regulations.”

Penn State Study: Marcellus Shale Development Expected to Create 98,000 Pennsylvania Jobs by 2010, $14.17 Billion Impact. PRNewsire. “Marcellus Shale development will pump $14.17 billion into the state’s economy in 2010 and create more than 98,000 jobs, while generating $800 million in state and local tax revenues, according to an economic study completed by the Pennsylvania State University for the Marcellus Shale Committee and the Pennsylvania House Natural Gas Caucus. The study notes a consistent increase in annual drilling and projects a $25 billion contribution to the Commonwealth’s economy in the year 2020. This level of activity would generate almost $1.4 billion in state and local tax revenue and create more than 176,000 new jobs.”

Study: Marcellus Shale to be major economic generator. Washington Observer Reporter. “Marcellus Shale development will pump $14.17 billion into the state’s economy in 2010 and create more than 98,000 jobs, while generating $800 million in state and local tax revenues, according to an economic study completed by Pennsylvania State University for the Marcellus Shale Committee and the Pennsylvania House Natural Gas Caucus. According to a news release issued Monday, the study notes a consistent increase in annual drilling and projects a $25 billion contribution to Pennsylvania’s economy in the year 2020. This level of activity would generate almost $1.4 billion in state and local tax revenue and create more than 176,000 new jobs.”

Gas drilling would help local economy. Press & Sun-Bulletin. “Developing between 2,000 and 4,000 natural gas wells in Broome County would generate between $7.6 billion and $15.3 billion in economic activity over 10 years, according to a draft report released Monday by Broome County officials. That would include as much as $1.21 billion from leases and royalties payments to land owners for mineral rights for the Marcellus Shale, a natural gas formation.”

Broome County is ‘Hottest’ Gas Drilling Area. FOX 40 News WICZ TV. “If done right, done safely, and done soon, Binghamton could see an economic impact in the billions of dollars over the next ten years. That’s the conclusion of a study on gas drilling, commissioned by Broome County. The study was drawn up by two economic professors from the University of North Texas. The preliminary report was released , on Monday, and speaks of the Marcellus Shale Deposit as fast becoming the hottest natural gas drilling play in the nation.”

Broome County Releases Natural Gas Economic Impact Study. WBNG-TV. “If done right, done safely and done soon, Broome County could see an economic impact in the billions of dollars over the next ten years as a result of the Marcellus Shale natural gas play. These are the findings of a Broome County Government commissioned Economic Impact Study. “We have been talking about the potential economic boon this area could experience as a result of developing our natural gas resources, however, up until this point, we have not been able to quantify those impacts,” said Executive Fiala. “With this study, we believe strongly that if balanced with the proper attention to environmental protections, the development of the Marcellus Shale can provide a tremendous and much needed economic boost to our local economy.”

Pipeline Firms Widen Natural-Gas Networks. Wall Street Journal. “A profound geographic shift in U.S. natural-gas drilling is leading pipeline companies to expand into new territories, even as prices for the fuel appear stuck in a lengthy slump. A few years ago, pipeline companies were focused on moving plentiful natural gas from the Rocky Mountains to hungry Northeastern markets. Today’s challenge is building enough infrastructure to handle the flood of gas now being pumped out of shale-rock formations in Appalachia and the Southeast. Thanks to improved drilling techniques these shale wells are producing giant volumes early in their lives, relatively cheaply, giving producers faster returns on their investments. …Rig counts were at a record high in the Marcellus Shale natural-gas field around Pennsylvania, and had declined just 2% year-to-date in Louisiana’s Haynesville Shale formation. Kinder Morgan Energy Partners LP of Houston and Energy Transfer Partners LP of Dallas have joint ventures for two major pipeline projects to transport gas extracted from newly prolific wells in Texas, Louisiana and Arkansas. One of the projects is the approximately 500-mile Midcontinent Express Pipeline, which serves regions including the Barnett Shale of Texas and the Fayetteville Shale in Arkansas.”

Gas well tax will impede development, study claims. Pittsburgh Post Gazette. “A Penn State University study released yesterday said Mr. Rendell’s proposed tax on the extraction of natural gas would hurt development of the natural gas industry in the state. … “The high level of drilling activity in Pennsylvania is partially a result of relatively lower taxes” compared to other states, said Mr. Solobay, who has much natural gas drilling under way in his home county of Washington. “This report sends a strong warning that if we impose a severance tax on natural gas production, we will miss out on this opportunity.” The two legislators are part of a 60-member House Oil and Gas Caucus, which opposes the proposed tax at the wellhead on natural gas extracted from areas of Marcellus shale, which cover up to three-fourths of the state.”

Ohio church, short on cash, wants gas drilling. Associated Press. “A financially struggling church has run into neighborhood opposition to natural gas drilling on church property. Stow Community United Church of Christ sits on a four-acre lot in this upscale Akron suburb. It needs the approval of neighbors living within 300 feet to allow drilling. Two of 20 owners have balked at signing because of safety and property-value concerns.”

Energy in Depth: Today’s News

Back off on move to restrict ‘fracing’ of wells. Houston Chronicle, Richard Burleson. “‘Fracing,’ as it’s called, is a proven technology. It has been in use since 1947; accounts for 30 percent of domestic recoverable oil and natural gas; and has facilitated the extraction of more than 600 trillion cubic feet of gas and 7 billion barrels of oil. The process has been used on roughly 90 percent of all wells in operation today. … So the process is time-tested. It allows for greater development of natural gas, a clean domestic fuel source. And it has an essential role in maximizing output from sources that can contribute significantly to energy independence. Yet Congress seems determined to undermine its potential. … According to the public awareness group Energy In Depth, if Congress and the Administration revise federal laws and regulations to target the energy industry, it will cause the shutdown of more than 204,000 U.S. oil wells and 150,000 natural gas wells. That, in turn, will result in the loss of 183,000 barrels of oil and 670 million cubic feet of natural gas per day.”

 
Haynesville Shale no longer diamond in rough. The Daily Advertiser, Don Briggs. “The economic impact of the Haynesville Shale on the entire state of Louisiana is of major significance. To understand the potential magnitude of the Haynesville, Louisiana Department of Natural Resources Secretary, Scott Angelle, contracted economist Loren Scott to conduct a direct and indirect economic impact study of the Haynesville shale to Louisiana’s economy. Scott determined during the year of 2008: The extraction activity of these seven firms generated approximately $2.4 billion in new business sales within the state of Louisiana. New business sales in turn created new household earnings for residents of the state. As a result of these activities, nearly $3.9 billion in household earnings was created in 2008. This estimate includes both direct and indirect earnings and includes almost $3.2 billion in lease and royalty payments to private landowners. Including the direct employment of approximately 431 employees and contract workers reported by these seven firms, there was an increase of 32,742 new jobs within the state in 2008. Our conservative estimate is that collectively, state and local tax revenues increased by at least $153.3 million in 2008 due to the extraction activities in the Haynesville Shale. … At a difficult time for our state’s economy and our industry, the Haynesville Shale will be a major pillar that will help prop up the businesses and economy of Louisiana.”

Packers Plus leads drilling revolution. Calgary Herald. “Fracturing tight rock to release oil and gas is nothing new–the basic concept has been used since the 1950s. Hydraulic fracturing –using water to force open fissures in producing reservoirs –allowed commercial development of some of Alberta’s earliest and biggest oil discoveries. Applying the basic theory to horizontal wells by isolating sections or “stages” to break rock along the entire length of the well bore has come along only since 2003. The key to making it work is a ceramic sphere, or packer, about the size of a billiard ball, that is used to divide the length of the well into more manageable segments that can be individually treated.”

Feinstein Strikes Again. A Conservative in Los Angeles. “A few months ago, I posted about a situation where I wrote Dianne Feinstein in opposition of a position she had and I got a thank you response for supporting the legislation. Well, it happened again. I wrote a comment opposing legislation that would restrict certain oil/gas drilling practices and I got the following response thanking me for supporting the legislation.”

Energy in Depth: Today’s News

Solution shifts drillers’ demand for water. Shreveport Times. “Continuing efforts to shift oil and natural gas operators from groundwater to surface water sources during the shale fracturing process got a boost Thursday. The Louisiana conservation office announced it is developing rules to allow limited reuse of exploration and production wastewater. The proposal may undergo more revision before final publication, which could come by year’s end, Conservation Commissioner Jim Welsh says in a news release. But already the idea is drawing praise from those committed to finding alternate water sources and staying away as much as possible from the troublesome underground aquifers that supply tens of thousands of residential customers in this part of the state.”

Marcellus Shale’s impact projected at $1B. Buffalo Business First. “The economic impact of natural-gas wells drilled in the Marcellus Shale could exceed $1 billion, according to a new assessment issued by the Independent Oil and Gas Association of New York. The trade association is projecting that 300 wells could generate $1.4 billion in economic activity, including $108 million for landowners, $32 million in state tax revenue, $19 million in property tax relief and hundreds of new jobs. Recent studies have suggested that more than 500 trillion cubic feet of natural gas lie within the Marcellus Shale, a geological formation that stretches from New York through West Virginia.”

Energy in Depth: Today’s News

Energy Policy, Refusing to Limit Opportunity. NAM’s ShopFloor.org. “Following up on yesterday’s Senate EPW hearing on energy policy and the states, where North Dakota Gov. John Hoeven called for a comprehensive national energy strategy (see post), the good people at Energy in Depth pass on an exchange the governor had with Sen. Jim Inhofe (R-OK).”

Schenevus drilling meeting draws 80. Oneonta Daily Star. “Also speaking was Orville Cole, a representative of Gastem, an operating partner with Covalent Energy LLC, which has drilling permits for three wells in the county. It is scheduled to drill a test well in August at a Maryland site, he said. There is a clear need for people to understand larger issues about drilling, such as the use of chemicals and traffic, he said. He talked about ways the company is working to ensure safety procedures are addressed. Among the others who spoke were several supporters of drilling from Tri-Town Landowners, a group of about 90 residents, members said. … Dairy farmer Barb Dulkis said it was something that could benefit the community. The economic rewards were worth the risk, she said.”

Striking it rich: Natural gas in Texas lures foreign drillers. KHOU-TV. “Foreign companies are pouring hundreds of millions of dollars into Texas to find and tap into huge deposits of natural gas. It may not be what Texas is best-known for, the oil that became known as “black gold.” These days, the talk among some wildcatters striking it rich is about a “green” resource-natural gas. And now, even the Kuwaitis may be coming to Texas in search of it. “It is a green fuel,” says Adam Haynes with the Texas Independent Producers and Royalty Owners Association. With the national push for less pollution and less dependence on foreign energy, natural gas is now achieving even greater demand. And there are trillions of cubic feet of it now accessible all over Texas, thanks to new ways of drilling.”

Energy in Depth: Today’s News

House approves Sullivan’s bill to reauthorize natural gas vehicle research program. Tulsa World. “The U.S. House approved a bill Tuesday by Rep. John Sullivan to reauthorize a research program on natural gas vehicles. Passed by a vote of 393 to 35, the bill would keep the program going another five years. “In 2008 alone, natural gas vehicles (NGVs) displaced 300 million gallons of petroleum in the United States,” said Sullivan, R-Okla. “I believe that natural gas must continue to play an important role in decreasing our dependence on foreign sources of oil and leading America to greater energy security.” He said about 97 percent of natural gas used in the U.S. is produced in North America. “My legislation undoubtedly helps our state as we are one of the top natural gas producers in the nation, typically accounting for almost one-tenth of the total U.S. production,” Sullivan said.”

Gas drilling forum in Ridgway. Leader Vindicator. “The Elk County Marcellus Shale Task Force headed by Commissioner June Sorg will host a presentation on natural gas drilling and private water supplies during the Elk County Planning Board Meeting at 7 p.m. Wednesday. … Penn State Extension Educator Jim Clark will present information about well drilling and water supplies. The development of the Marcellus Shale has led to questions from residents about the natural gas drilling process. Clark’s presentation will explain the basics of the drilling and the possible impacts on private water supplies. The Marcellus Shale is a geological formation 5,000 to 8,000 feet below the surface that runs from central New York State southwest through central Pennsylvania into northwestern West Virginia and southeastern Ohio. It is estimated to contain more than 168 trillion cubic feet of natural gas.”

Energy in Depth: Today’s News

U.S. Rep. Dan Boren unhappy with health care, energy proposals. The Oklahoman. “On energy, Boren said, “The cap and trade bill is really the worst piece of legislation I’ve seen since I’ve been there. It raises energy prices on businesses, raises electric bills on families, and it even raises gasoline prices in the middle of a recession. And, it makes America less competitive in the global economy.” In response to a question, Boren said he is working with Rep. Diana DeGette, D-Colo., to tone down her bill to regulate hydraulic fracturing of oil- and gas-bearing formations. The legislation was introduced to protect water supplies from contamination, but Boren said the procedure is already safe. “If you shut down fracking, you shut down the industry,” Boren said.”

European Gas Takes Unconventional Turn, Hard-to-Reach Gas Might Be the Key to a Secure Supply. Wall Street Journal. “Energy companies operating in Europe are turning to more unorthodox sources of natural gas to get around maturing gas fields and the European Union’s worries about its dependence on Russian fuel. Unconventional gas, as it is known, is trapped in different types of rock formations — much of it in shale — and can be freed through drilling horizontally, fracturing the rocks or injecting water into spaces.”

Climate change policy will kill clean energy. Southeast Texas Record, Railroad Commissioner Elizabeth Ames Jones. “One energy success story is clean-burning natural gas. Technology developed by visionaries, not inside-the-beltway, so-called experts, has paved the way for responsible production of this clean burning fuel. Drilling for natural gas found in places once deemed unreachable is now common place across the country. In fact, America is so rich in natural gas that with the sound management of the fields that is occurring today, our country could produce almost as much clean energy as we consume … if we wanted to. That is the definition of energy independence to me. But Waxman-Markey is yet another scheme coming out of Washington that will add to the cost of drilling for natural gas, most of which is done by independent companies, leaving geologists, engineers, drilling companies and entrepreneurs to look for greener pastures … foreign countries that welcome our know-how and want to produce their own natural gas using technology developed in America.”

Feds affirm drilling near ruins, Golden Spike. Associated Press. “A federal appeals board has cleared the way for oil and gas drilling around prehistoric ruins in southern Utah. In the same ruling, the Interior Board of Land Appeals found that federal officials also took appropriate care in deciding to lease another parcel near northern Utah’s Golden Spike National Historic Site.”

House Seeks to Boost Natural Gas Vehicles. Congressional Quarterly. “Research and development of natural gas-powered vehicles would get a boost under legislation the House is set to take up Monday. The bill would direct the Energy Department and Environmental Protection Agency to focus research on commercial vehicles. The legislation would charge the agencies with developing procedures and national standards for the vehicles and for natural gas fueling stations. The bill would authorize $30 million a year from fiscal 2010 to 2014 for natural gas vehicle research.”

Separating Fiction from Invention in ProPublica’s Latest Anti-HF Attack Piece

Earlier this week, ProPublica author Abrahm Lustgarten released the latest installment in his series of advocacy pieces attacking the commonly used energy technology known as hydraulic fracturing. Instead of simply running on the ProPublica blog and website, however, the article was co-published with Politico and appeared in the paper’s news section (a letter to the editor from Energy In Depth policy director Lee Fuller will appear in the paper this Tuesday).

It wasn’t the first time that a mainstream news outlet provided ProPublica with a platform for this kind of product – although, for papers such as the Pittsburgh Post-Gazette, the determination has been made that ProPublica articles, when run, are more appropriately filed on its “opinion/perspectives” page than as part of its straight-news reporting.

Prior to its release, Energy In Depth spoke at length with Mr. Lustgarten about the direction of the (presumably already written) piece and the myriad mistakes he was making in issuing a blanket indictment of recent government and third-party reports finding that EPA regulation of hydraulic fracturing would cost Americans jobs, revenues and future security.  

Regrettably, none of those explanations made it into his final piece. What follows is our attempt to identify and correct the areas in which Mr. Lustgarten’s errors were most egregious:

 PP: “Now, Congress is considering legislation to restore the EPA’s oversight of [hydraulic fracturing].”

Fact: Opponents of hydraulic fracturing understand well that the success of their anti-fracing campaign depends in large part on their ability to convince people that fracturing was previously regulated by the EPA, and that all they are therefore seeking to achieve is the full and fair restoration of the Safe Drinking Water Act (SDWA) of 1974 to its previous self.

Set aside the fact that hydraulic fracturing has never been regulated by SDWA at any point in the 35-year history of the Act.  Not only does Mr. Lustgarten continue to parrot this falsehood, but members of Congress and staff have begun to pick up on the theme as well:

Jeff Lieberson, a spokesman for [Rep. Maurice] Hinchey, said the IHS study should be discounted because it was not conducted independently. “It’s just ridiculous,” he said. “Their forecasting showing production going down dramatically doesn’t make sense, because all we’re trying to do is to go back to the way things were in 2004, before the loophole was inserted in the 2005 energy bill.” (June 1, 2009, Platts Gas Daily)

Of course, what Mr. Lieberson likely does not know – but Mr. Lustgarten likely does – is that “the way things were in 2004″ is identical to the way things are in 2009; that is, states continue to aggressively regulate the process of hydraulic fracturing, continue to have access to the all the information they need to exercise full oversight over the process, and continue to update and improve their regulations to reflect changes in landscape, science and new technology.

PP: “Furthermore, none of the tests listed in the table is mentioned in the text of the Safe Drinking Water Act …[a]nd they aren’t mentioned in the bill being floated in Congress, either.”

Translation: Studies that show EPA regulation over hydraulic fracturing could cost billions in lost revenues, lost wages, and lost energy production must necessarily be wrong – since there’s nothing in the DeGette/Casey anti-FRAC Act, or in the text of SDWA, that indentifies specific compliance measures that would need to be followed pursuant to the bill.

Fact:  Very rarely does the text of any legislation, proposed or passed, include an explicit enumeration of the regulatory mechanics under which its stated mandate must be carried out (that’s what the regulatory agency and, if needed, the courts are for).  In fact, EPA has promulgated rules that create five classes of Underground Injection Control wells and is now considering creating a sixth classification to address carbon sequestration.  None of these are explicitly “mentioned in the text of the Safe Drinking Water Act”; all of them are solely the creation of EPA under its SDWA authority.

In the case of DeGette/Casey, section 2(a) of the bill clearly amends SDWA to include the regulation of hydraulic fracturing under its portfolio. With SDWA regulation comes the potential for EPA permit-authority over the process, a prospect that then-EPA administrator Carol Browner admitted was unnecessary in 1995. Current administrator Lisa Jackson is neither bound by, nor has she endorsed, that position. 

Bottom line: Just because a detailed set of instructions for how, why, and when EPA should regulate fracturing wasn’t included in DeGette/Casey doesn’t mean that EPA, once allotted this new authority, won’t pursue it to the fullest possible extent – including the possibility of regulating fracturing activities under hyper-stringent Class I rules previously set aside for the permanent disposal and storage of the world’s most hazardous wastes (a proposal included in the Natural Resource Defense Council recommendations to Congress).

Nine out of 10 wells in America undergo fracturing to remain viable producers of energy – a process that happens hundreds of times a week, thousands of times a year, and more than 1.3 million times in all. Any effort to impose a new regulatory structure on a process as common and critical as that will necessarily produce serious consequences. And as studies from the Department of Energy, Ground Water Protection Council, and IHS Global Insight make plain, the disruption of this technology could lead to a significant loss in jobs, revenue and energy produced.

PP: “A close examination of the appendixes attached to the research also showed that 21 of the 31 states listed do not have any specific regulation addressing hydraulic fracturing.”

Translation: If the words “hydraulic” and “fracturing” aren’t included in consecutive sequence in a state’s regulatory handbook, it must be the case that the state does not regulate any aspect of the process whatsoever.

Fact: It is in fact possible (and indeed, common) for a government entity to claim regulatory authority over something that’s not explicitly enumerated in the text of the relevant statutory document (see: the “general welfare” clause of the U.S. Constitution). No one doubts, we hope, that the states of Pennsylvania, New York and Texas regulate hydraulic fracturing. But you won’t find the term “hydraulic fracturing” anywhere in their individual oil and gas regulations. Here’s what you will find (pg. 26):

Pennsylvania: “[T]he department shall have the authority to issue such orders as are necessary to aid in the enforcement of the provisions of [the oil and gas] act.” (58 P.S. section 601.503)

New York: “The drilling, casing and completion program adopted for any well shall be such as to prevent pollution. Pollution of the land and/or of surface or ground fresh water resulting from exploration or drilling is prohibited.” (6 NYCRR Part 554)

Texas: “No person conducting activities subject to regulation by the commission may cause or allow pollution of surface or subsurface water in the state.” (TAC 16.1.3.8) 

“The states,” the Ground Water Protection Council found in its April 2009 report, “have broad powers to regulate, permit, and enforce all activities-the drilling and fracture of the well, production operations, management and disposal of wastes, and abandonment and plugging of the well.” Moreover: “[S]tate laws generally give the state oil and gas director or agency the discretion to require whatever is necessary to protect human health and the environment.”

In reality, the primary method for protecting ground and drinking water from contamination by natural gas wells – during both hydraulic fracturing and production activities – is the use of additional steel piping (casing) and cementing of the well bore above and below the ground water.  ProPublica tries to discount the effectiveness of this proven management method by applying a superficial reading of various state regulations. The real tests are the 950,000 operating natural gas and oil wells throughout the United States that function daily with rare failures.

PP: “In May the Ground Water Protection Council, a group made up mostly of industry representatives and state oil and gas regulators….”

Translation: If industry is involved in an organization, it cannot be trusted.

Fact: The Ground Water Protection Council is “a national association of state ground water and underground injection control agencies whose mission is to promote the protection and conservation of ground water resources for all beneficial uses, recognizing ground water as a critical component of the ecosystem.”(from the GWPC web site).  Industry members are not allowed on its board.  Its committee members are primarily state officials, but can include both environmentalists and industry participants. 

Unable to credibly undermine GWPC’s findings, ProPublica instead focuses on undermining the integrity of the institution itself, implying that its study should be discounted solely on the basis of its perception of industry influence.  In fact, and as noted, the studies ProPublica references were conducted under funds provided by the Department of Energy.

Want to participate in the discussion? Click here to access the ProPublica piece on the Politico website; here to post a public comment on the piece; here to email a blog post to Energy In Depth; or here to send an email to Mr. Lustgarten. 

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Additional resources available at Energy In Depth:

• Press Release: Duplicative hydraulic fracturing rules could imperil U.S. economy
• GWPC Study: State Oil and Natural Gas Regulations Designed to Protect Water Resources
• Graphic: How Far Down Do We Frac?
• Graphic: What’s In Frac Fluids?
• Fact Sheet: New Federal Regulations Will Cost Americans Jobs, Revenue, and Security
• EPA Study: Study to Evaluate the Impacts to USDWs by Hydraulic Fracturing of Coalbed Methane Reservoirs
• Browner Memo: Letter of Support for Hydraulic Fracturing from Carol Browner, Fmr. EPA Administrator
• Interactive Graphic: How Could Efforts to Attack Hydraulic Fracturing Impact Your State?

Energy in Depth: Today’s News

Federal Regulation of Hydraulic Fracturing Is Not the Solution. Energy Tribune, Op-Ed. “Hydraulic fracturing, also known as “fracing,” is the process of using high pressure fluids to crack rock formations thousands of feet below the surface in order to retrieve a greater amount of oil and gas resources than would otherwise be recovered. This process has been used to enhance production of hydrocarbons for over 60 years. It is safe. It is effective. And it is essential element in the production of hydrocarbon supplies both today and in the future. It should not be regulated by federal authorities. In June, US Rep. Diana DeGette, a Colorado Democrat, along with several other legislators, introduced federal legislation that would give federal authorities oversight on fracing. This is not needed. Hydraulic fracturing is already successfully being regulated by individual states and these states already know and implement the best practices for them. In today’s oilfield, safety is the first priority. If a task cannot be accomplished safely in the oilfield then it is postponed or well-site activities stop until all issues are resolved. This is true of hydraulic fracturing.”

Weld commissioners oppose ‘fracking’ oversight. Greeley Tribune. “The Board of Weld County Commissioners has joined six other counties in opposing proposed federal regulations on natural gas exploration. … Bill Garcia, chairman of the Weld commissioners, said he cannot understand the reasoning behind the measure. “I guess it makes sense if you want to stop oil and gas production in the United States. If that’s your goal, then this is the way to do it,” Garcia said. … Weld commissioners, in their opposition resolution, pointed out that the Energy Policy Act of 2005 explicitly exempted fracturing from the provisions of the Safe Drinking Water Act, and said that the technology has been used more than 1 million times in the past 60 years with no harm reported to groundwater supplies. “There is no problem here; no allegations of it affecting water,” Garcia said. … Meanwhile, Ben Marter, communications director for Rep. Betsy Markey, D-Colo., said she has been looking at the measure “and does have some serious concerns with it.” He said Markey, who represents Colorado’s 4th Congressional District, which includes Weld, “knows full well the importance of natural gas to north and northeastern Colorado and will keep that in mind as she evaluates” the bill. Weld joins Morgan County on the Eastern Slope and Delta, Mesa, Moffat and Rio Blanco on the Western Slope in adopting resolutions opposing the proposed legislation. Yuma County commissioners are expected to adopt a similar resolution at a July 31 meeting.”

Pa. shale gas estimated at $1,000,000,000,000. Pocono Record. “Pennsylvania, the home of the American Industrial Revolution – first fueled by anthracite coal, then bituminous coal, and later the home of the first oil well – may soon be the Saudi Arabia of natural gas. Pennsylvania State University estimates that the wellhead value of gas recoverable from the Marcellus shale in Pennsylvania is one trillion dollars. In early 2008, Terry Englander, a geoscience professor at Pennsylvania State University, and Gary Lash, a geology professor at the State University of New York at Fredonia, surprised everyone with estimates that the Marcellus shale formation might contain more than 500 trillion cubic feet of natural gas. They calculated that 10 percent of the gas – 50 trillion cubic feet – was recoverable. That volume of natural gas would be enough to supply the entire United States for about two years and have a wellhead value of about one trillion dollars.”

Hinchey and gas drilling. Press & Sun-Bulletin, LTE. “Eight hundred jobs are U.S. Rep. Maurice Hinchey’s top priority in his battle to keep the presidential helicopter program alive at Lockheed Martin. Why isn’t he making a similar effort for the local jobs and revenue from drilling for natural gas in the Marcellus Shale? … If jobs are his concern, Hinchey should use his energy and time on behalf of farmers who are dying and jobs that are no longer available. President Obama suggested we find energy resources within the United States. We have them in the Southern Tier. Hinchey’s concern for jobs should be where positive results can be accomplished. The Marcellus Shale promises positive results.”

Energy in Depth: Today’s News

Concerns in oil-producing states. The Dickinson Press. “Rep. Diana DeGette, D-Colo., Rep. Jared Polis, D-Colo. and Rep. Maurice Hinchey, D-N.Y., introduced the Fracturing Responsibility and Awareness of Chemicals Act in the Senate and the House of Representatives on June 9. The bill would require oil and gas companies to adhere to Environmental Protection Agency standards and require disclosure of the chemicals used during the “fracking” process. … North Dakota has yet to sign on in support of this bill. “That bill would be a disaster for us,” Sen. Byron Dorgan, D-N.D. said. “Hydraulic fracturing is a very important part of being able to explore and drill for oil in the Bakken formation.” Rep. Earl Pomeroy, D-N.D., opposes the bill as well, stating the oil reserves are now recoverable because of technological advances such as “fracking.” “The bill is potentially very threatening to the oil exploration and recovery activity underway in North Dakota,” Pomeroy said. “It’s one of these pieces of legislation that is a solution in search of a problem.”

More Regulation Has Its Costs. Forbes. “The upcoming possibility of stricter regulation of hydraulic fracturing by both state and Federal authorities is a major threat to the industry’s ability to maintain production of natural gas in North America. If a cumbersome regulatory process is imposed on the oil and gas industry, it may lead to an even further drop in drilling, lower production and much higher natural gas prices for consumers and businesses. … The industry has solved the technological problem associated with producing natural gas from the unconventional sources that have come to dominate drilling in North America. Horizontal drilling, and the associated hydraulic fracturing, is needed for the industry to deliver natural gas to those who demand it.”

Tap natural gas. Pittsburgh Tribune-Reivew, Ray Walker of Range Resources. “It’s not surprising that Marcio Zimmerman, Brazil’s deputy minister of mines and energy, expressed great interest in Pennsylvania’s Marcellus Shale. … Natural gas can lead our nation’s energy future as well. The Energy Information Association predicts 57 percent of new electric generation through 2020 will come from natural gas — more than all other sources combined and without government subsidies. Breakthroughs like the Marcellus Shale have increased domestic supplies more than 35 percent in just a few years. Now is the time to embrace natural gas to fuel commonwealth fleets. It’s cheaper, abundant, produced in Pennsylvania and better for the environment. …With proper support, natural gas can fuel Pennsylvania’s economy for a century or longer. We can lead the way for a new energy movement if we embrace the opportunity that’s right below our feet.”

Energy in Depth: Today’s News

Commissioners won’t back fracing bill. The Durango Herald. “La Plata County commissioners on Tuesday voted against a resolution to support federal regulation of chemicals used by the gas and oil industry to fracture rock formations in the drilling of wells. The nonbinding resolution addressed federal legislation being considered in Congress that would repeal the exemption of hydraulic fracturing fluids from regulation under the Safe Drinking Water Act. … U.S. Rep. John Salazar, D-Manassa, is not among the bill’s co-sponsors, and Colorado Gov. Bill Ritter last week won muted praise from industry representatives for his stance favoring a comprehensive study “instead of jumping directly to a new and potentially intrusive regulatory program.”

Gas commission honors companies for their efforts to help environment. Grand Junction Sentinel. “Several energy companies with local operations are among those recently honored by the Colorado Oil and Gas Conservation Commission. Harris Sherman, chairman of the commission and director of the state Department of Natural Resources, presented the awards at a Colorado Oil & Gas Association conference in Denver.”

Natural Gas: Bridge to the Energy Future. Seeking Alpha. “US natural gas resources and attendant reserves are, again, a strategic opportunity for the US and for investors. It is becoming clearer every quarter that not only are US natural gas resources much greater than imagined even 5 years ago, but reserves have the potential to increase steadily for many years, if market incentives exist. … Immense, indeed unbelievably huge, amounts of energy are trapped in these hydrates. Confirmed deposits are especially abundant in the US and Canada with the largest such found in the GOM. However, this may be because the active search for these hydrates has just begun. … Shale gas is one of the greatest commercial plays in the history of the American gas industry. … The least romantic fossil energy may turn out to be the most strategically vital for the world in the 21st century.”

North Dakota could have a huge new oil field. Associated Press. “Dozens of fruitful wells beneath the rich Bakken shale in North Dakota continue to fuel a hunch among oilmen and geologists that another vast crude-bearing formation may be buried in the state’s vast oil patch. Lynn Helms, director of the state Department of Mineral Resources, said recent production results from 103 newly tapped wells in the Three Forks-Sanish formation show many that are “as good or better” than some in the Bakken, which lies two miles under the surface in western North Dakota and holds billions of barrels of oil. “I think it’s a big deal and we’re pretty fired up about it,” Helms said.”

Energy in Depth: Today’s News

Fracking has always been regulated. Grand Junction Sentinel, Dennis Lathem Op-Ed. “Hydraulic fracturing has never been regulated under the Safe Drinking Water Act. The 2005 Energy Policy Act contained language clarifying this intent. … This whole issue of hydraulic fracturing has been distorted.  Many of those trying to stop this safe (50-year) industry practice would have everyone believe that hydraulic fracturing is not regulated at all. Nothing could be further from the truth. State oil and gas and environmental regulatory agencies are in control of this practice and have been for decades. … State regulation, by scientists and engineers who are the experts in the geology and hydrology of their state, is the very best way to control and monitor this practice. A one-size-fits-all mandate from Washington, D.C. is not the way.”

Pickens on natural gas: You can’t beat it. CNNMoney.com. “Natural gas must replace petroleum. “It’s cleaner, it’s cheaper, it’s ours, and it’s abundant,” Pickens told Fortune staffers. “And boy, you can’t beat that.” … “You sell [natural gas] on the patriotic angle, and say we can get it cleaner, we can get it for the same price, and it’s ours. Hell, you’re creating jobs. Every time you do it you’re creating jobs. Right now, when you buy foreign oil, your money’s gone. You [do] see it again: It comes right back in and buys your assets.” … “The way I look at it, everything that’s made here is good. Because it creates jobs and pays taxes, and it gets [us away] from foreign oil. So everything I can do here helps the country.”

Area residents learn about Marcellus Shale drilling. Clearfield (PA) Progress. “A crowd of 100 or more people gathered last night at the Clearfield Area High School for an informational meeting about the Marcellus Shale natural gas deposit. The meeting was conducted by the Marcellus Shale Committee, which was formed in 2008 to represent the industry. Clearfield County Commissioner Joan Robinson…said development of the Marcellus Shale natural gas deposit will bring opportunities to the area, and the county needs to make business easy and profitable. … Mr. D’Amico said the drilling for natural gas in the shale, which is the cleanest fossil fuel, is done by horizontal drilling, a fairly recent development in drilling technology in which the drill first drills vertically and then is able to do a 90 degree turn into the shale deposit. Water and sand are then forced into the shale, creating fractures, allowing the gas to be released. Mr. D’Amico said horizontal drilling allows for greater results with less impact. … The state Department of Environmental Protection’s regulations are very strict, he said.”

First gas drilling permit issued in Lackawanna Co. Associated Press. “State regulators have issued the first permit in Lackawanna County to drill for natural gas on the potentially lucrative Marcellus Shale formation. Exco Resources Inc. said Monday it received the permit from state regulators to drill two sites near the Skyline Public Golf Course in Greenfield Township.”

Natural gas drilling will employ a variety of professions. Clearfield (PA) Progress. “Lou D’Amico of the Pennsylvania Oil and Gas Association talked about the economic impact of the gas drilling, and the Marcellus Shale Committee provided printed information on jobs to the crowd. Mr. D’Amico said eventually there will be new jobs and opportunities for Pennsylvania including a full range of professions and skilled trades. In 2008 a committee was commissioned to conduct a study on the impact. Currently in the natural gas industry, $4.5 billion directly results from the industry with a total impact of $7.1 billion with more than 10,000 direct jobs.”

Opinions split on methane in water. Grand Junction Sentinel. “Several scientific experts on Tuesday challenged a Garfield County consultant’s conclusion that methane levels are increasing in domestic water wells in conjunction with growing natural gas development south of Silt and Rifle. If anything, the methane levels are showing a slight decrease, Bob Sterrett, a geologist who looked at the issue on behalf of energy developer Bill Barrett Corp., told the Colorado Oil and Gas Conservation Commission Tuesday. A consultant for EnCana Oil & Gas (USA) also took issue with the findings late last year by Geoffrey Thyne, a geology professor asked to analyze the results of a hydrogeological study conducted for the region. In addition, Thyne’s analysis was questioned by representatives of the company that conducted the study, and by an environmental protection specialist with the oil and gas commission.”

Energy in Depth: Today’s News

A Democratic fracture over fracking. Grand Junction Sentinel, Editorial. “Colorado Gov. Bill Ritter is at odds with Congresswoman Diana DeGette and other Democrats in Congress over the need for federal legislation to regulate chemicals used in hydraulic fracturing, a process used to improve the recovery of oil and gas from wells. Ritter, reasonably enough, thinks DeGette’s proposed legislation could be an impediment to the development of our natural gas and is largely unnecessary because new state rules address fracking chemicals. We’re with the governor on this. Several federal studies under both Republican and Democratic administrations found no link between fracking chemicals and contamination of drinking water. That’s why it was excluded from the federal Safe Water Drinking Act in the first place. … Furthermore, it makes sense, as Ritter said he told DeGette, to let each state develop the rules it believes best suits its needs rather than adopt one-size-fits-all federal regulations. DeGette, unfortunately, seems committed to pushing her fracking legislation, regardless of what the governor and local government officials in Colorado want. … But we’re glad to see Ritter is willing to stand up to a senior member of his party in Colorado, and tell DeGette that her fracking bill is the wrong prescription for this state.”

EPA should revisit fracking. Denver Post, Editorial. “The vigorous debate over hydraulic fracturing – an oil and gas extraction technique – has raised an important question that must be answered before federal lawmakers consider additional regulation. In short, has the process of pumping fracturing fluid into the ground to release oil and gas contaminated drinking water? Gov. Bill Ritter this week urged U.S. Rep. Diana DeGette, D-Denver, to take her foot off the accelerator on regulatory efforts, suggesting further study first. We think that’s a prudent policy move. … DeGette last month introduced a bill in Congress that would remove the 2005 exemption that allows fracking to skirt the Safe Drinking Water Act. The measure would, in effect, require new natural-gas wells to get EPA permits to use the fracking process. Ritter called fracking “essential to the development of Colorado gas resources,” adding, “We have to understand the problems and the risks before we act.”

Ritter, DeGette disagree on frac bill. The Durango Herald. “Gov. Bill Ritter said Thursday he has asked U.S. Rep. Diana DeGette to back off her bill to regulate hydraulic fracturing and that she has agreed. … Instead of a “one-size-fits-all” and “potentially obtrusive” federal approach, Ritter said he urged DeGette in a June meeting to start a comprehensive study of frac fluids.”

Rep. DeGette pursues hearing, study on ‘fracking’. Associated Press. “U.S. Rep. Diana DeGette is moving ahead with her bill to put a widely used oil and gas drilling process under federal oversight while also seeking a study to gather more data on the practice. The Colorado Democrat is sponsoring a bill that would repeal a ban on regulating hydraulic fracturing under the federal Safe Drinking Water Act. The 2005 energy bill exempted the process, also called “fracking,” from federal oversight. … Colorado Gov. Bill Ritter entered the debate Thursday when he said in a speech at the Colorado Oil and Gas Association’s annual conference that he has asked DeGette to consider a comprehensive study “instead of jumping directly to a new and potentially intrusive regulatory program.” … “We don’t fear a study as long as the study is done in a fair, balanced way,” said Lee Fuller, a vice president with the Independent Petroleum Association of America. The Washington, D.C.-based trade group and other industry associations believe that hydraulic fracturing is adequately regulated by the states. They point to regulations for drilling wells and setting cement casings to keep chemicals, oil and gas away from groundwater. “Hydraulic fracturing has not presented environmental risks in context of the current regulatory regime of the states,” Fuller said.”

Shale throws industry, Colo. in new terrain. Durango Herald. “Unnoticed by most people outside the energy industry, America suddenly is awash in natural gas, because of technological breakthroughs that could have major effects in Southwest Colorado. Southern La Plata County used to be the king of Colorado gas fields, and the area still produces more than a third of the state’s output. But now companies are looking at deposits north and west of Cortez and on La Plata’s western side, which has seen very little drilling in the past. What’s more, producers are moving into vast regions of Texas, North Dakota, Louisiana, Pennsylvania and New York – new competitors for Colorado’s gas industry. The gas world changed when producers figured out how to extract gas from shale – very tight rock formations that previously were too costly to drill. “The paradigm for natural gas has changed. Our industry may have re-created the supply glut of the 1990s,” said Keith Rattie, CEO of Questar Corp., which had been looking at a Montezuma County project before gas prices collapsed. A report last month from the Potential Gas Committee at the Colorado School of Mines said shale gas had helped boost the possible U.S. reserves to more than 2,000 trillion cubic feet, enough for almost a century of consumption at current rates. The number is a third higher than the group’s last report in 2007. … Frac regulations vary from state to state. In Colorado, as of this May, companies have had to maintain a list of their well site chemicals and disclose them to state regulators, but not the public. In Pennsylvania, frac fluid ingredients are a matter of public record, but not the formulas by which the chemicals are blended.”

Gas Drilling Study Delay. NewsChannel-34. “The New York State Department of Environmental Conservation has missed a deadline that could delay the creation of thousands of jobs in New York State. The DEC was supposed to release a preliminary environmental impact study on drilling in the Marcellus Shale in June. That’s an area of rock rich in natural gas from Ohio, to Pennsylvania and New York. Drilling in the Marcellus requires a different technology called hydraulic fracturing or fracking which uses high pressure water, sand and chemicals to break the gas out of rocks.”

Louisiana economy weathering national recession. Shreveport Times. “Louisiana’s economy being somewhat sheltered from the national recession could be good and bad, the state’s top economic development official says. … “By any reasonable measure, Louisiana’s economy has outperformed the South and the U.S. since the beginning of the national recession in December 2007,” he said. … The latest report shows Louisiana with a 6.6 percent unemployment, compared to the nationwide average of 9.4 percent. Only 10 states have lower jobless rates than Louisiana. None is in the South. … Foreman said a number of related companies are coming into the Haynesville Shale region “to be ready to support shale activity. It’s a 20- to 25-year scenario.” Gregg Gothreaux, director of the Lafayette Economic Development Authority, said unemployment in that region is 4.8 percent, better than much of the state and just over half of the national rate.”

Parts of S. Tier see rise in gas production; But Marcellus Shale off limits, for now. Elmira Star-Gazette. “While the Marcellus Shale is off limits for now, energy companies are finding success tapping other natural gas formations in the Southern Tier. Gas production was up in counties to the north and west of Broome County in 2008 as Norse Energy drilled into the Herkimer shale formation in Chenango County and Fortuna Energy tapped the Trenton Black River in Tioga County, according to the most recent information from the state Department of Environmental Conservation.”

Geologists Council to hold session on gas drilling. Wilkes Barre Times-Leader. “The Pennsylvania Council of Professional Geologists will hold a seminar Tuesday on gas drilling in the Marcellus Shale, and it’s prepared to take on even the most technical of questions, from the science of the drilling itself to the legal issues surrounding it. “We’re going to try to answer those questions,” said Rhonda Hakundy-Jones, the council’s executive director. “We’ve certainly heard those questions before. Some of them don’t have definitive answers; they have, shall we say, a range of answers.”

Reed’s plan for drilling gets new life. Indiana Gazette. “To arrive at a balanced spending plan, House Republicans incorporated a revenue-generating idea – the success of which isn’t guaranteed – floated by Rep. Dave Reed earlier this year. Reed, R-Indiana, in March unveiled a bill that would open additional state forestland to natural-gas well drillers, specifically those looking to tap the Marcellus shale underlying large swaths of the state. The bill was meant to counter Gov. Ed Rendell’s proposal to institute an extraction tax, also known as a severance tax, on the state’s natural gas production. The severance tax was included in Rendell’s initial budget proposal in February. Reed and other House Republicans object to the tax, saying they believe it would clip the wings of Pennsylvania’s fledgling Marcellus shale drilling industry. Under Reed’s plan, the state Department of Conservation and Natural Resources would be directed to select and then lease 390,000 acres of Pennsylvania forestland to Marcellus shale drillers.”

Energy in Depth: Today’s News

Ritter to DeGette: Slow down. Denver Post. “Gov. Bill Ritter said Thursday he has urged Denver Congresswoman Diana DeGette to go slow on her bill to regulate oil- and gas-well hydro-fracking under the Safe Water Drinking Act. Ritter, a Democrat, said he “encouraged” DeGette, also a Democrat, to consider a comprehensive study “instead of going directly to a new and potentially intrusive regulatory program.” … Ritter called fracking “essential to the development of Colorado gas resources.” NOTE: Click HERE to listen to Gov. Ritter’s remarks at the Rocky Mountain Energy Epicenter Conference, an annual event organized by the Colorado Oil & Gas Association.

Colo. gov. hails natural gas as ‘critical’ fuel. Associated Press. “Colorado Gov. Bill Ritter, who has made promoting renewable energy a cornerstone of his administration, on Thursday called natural gas “a mission-critical fuel” that is essential to the state and nation’s economy. “Natural gas is a vital part of the new energy economy, a permanent part of the new energy economy, not a bridge fuel, not a transition fuel, but a mission-critical fuel,” Ritter told a crowd of industry officials at the Colorado Oil and Gas Association’s annual conference in Denver. … Ritter said during his speech Thursday that he has asked U.S. Rep. Diana DeGette, a Democrat from Denver, to consider a comprehensive study of the drilling technique hydraulic fracturing before “jumping directly to a new and potentially intrusive regulatory program.” DeGette has introduced a bill that would regulate hydraulic fracturing, also called “fracking,” under the federal Safe Drinking Water Act. The 2005 energy bill exempted the process from regulation under that law.”

Ritter: Natural gas ‘vital part’ of new-energy economy. Denver Business Journal. “Gov. Bill Ritter offered Colorado’s natural gas industry his support Thursday in a speech on the last day of the Colorado Oil & Gas Association’s annual three-day conference. “Natural gas is a vital part of the New Energy Economy,” Ritter told the crowd of about 2,000 people. “It is a permanent part of the New Energy Economy. It’s not a bridge fuel, not a transition fuel, but a mission-critical fuel.” … “That’s why I encouraged Congresswoman DeGette to consider authorizing a comprehensive study of this issue instead of going directly to a new and potentially intrusive regulatory program. She agreed, at that time, to go instead to something that would be more in the way of a study instead of an amendment that would prescribe every state having to put in place these rules,” Ritter said.”

Gov. Ritter asks DeGette to modify hydraulic fracturing bill. PennEnergy. “Colorado Gov. Bill Ritter Jr. said in a Denver address that he asked US Rep. Diana DeGette (D-Colo.) to seek a comprehensive study of hydraulic fracturing “instead of jumping directly to a new and potential intrusive regulatory program.” He disclosed the request during a July 9 speech to the Colorado Natural Gas Association’s Rocky Mountain Strategy Conference. DeGette and Reps. Maurice D. Hinchey (D-NY) and Jared Polis (D-Colo.) introduced a bill on June 9 which would require federal regulation of hydraulic fracturing under the Safe Drinking Water Act. US Sen. Robert P. Casey Jr. (D-Pa.) introduced a similar bill the same day. … “She had a very good conversation with the governor on this matter. She is looking at all options and agrees that a study is needed. But she is not backing off her bill,” a spokesman for DeGette told OGJ Washington Pulse on June 9 when asked for a response.

Ritter wants study instead of regulation of hydraulic fracturing, DeGette spokesman: No plans to back off proposed legislation. Grand Junction Sentinel. “Gov. Bill Ritter is calling for a study of hydraulic fracturing in lieu of immediate federal legislation that he says could result in a potentially intrusive regulatory program for the oil and gas industry. However, despite comments suggesting otherwise by Ritter, a spokesman for U.S. Rep. Diana DeGette, D-Denver, says she is not backing off trying to get the legislation passed.”

Drilling industry’s concerns. Ithaca Journal, Brad Gill, Independent Oil & Gas Association of New York. “What is troubling about the recent article titled, “Activist: Drilling in N.Y. needs scrutiny” is that the piece neglects to mention that New York has perhaps the most stringent environmental laws in the nation – much stricter than those states mentioned in the article. … Natural gas exploration is a safe, well-regulated, environmentally sound practice that has been applied in New York for decades. … And as is alleged in other states, hydraulic fracturing has not caused natural gas to infiltrate residential water supplies in New York. Furthermore, 99.5 percent of the ingredients used in hydraulic fracturing primarily consist of water and sand. … all components will be disclosed to the DEC.”

Rep. DeGette Pursues Hearing, Study On ‘Fracking’. CBS4/AP. “Colorado congresswoman Diana DeGette is moving ahead with her bill to put a widely used oil and gas drilling process under federal oversight, but is also seeking a study to gather more data on the practice. … DeGette’s spokesman Kristofer Eisenla says the request for a study on fracking doesn’t mean she’s backing off the legislation. She’s also trying to schedule a hearing on the proposal.”

Energy in Depth: Today’s News

Commissioner Martin criticizes FRAC Act. Glenwood Springs (CO) Post Independent. “Garfield County Commissioner John Martin may not have taken a formal position concerning a proposal to list “frac’ing” – shorthand for hydraulic fracturing of a natural gas well – as one of the industrial activities covered by the U.S. Safe Drinking Water Act (SDWA) of 1974. But at a meeting this week, Martin left little doubt as to how he feels about the so-called FRAC Act – an acronym for the Fracturing Responsibility and Awareness of Chemicals Act – which was introduced in June in both houses of the U.S. Congress. … “I don’t know of one legislator from the Western Slope of Colorado who is in support of it,” Martin continued, possibly a reference to the fact that Rep. John Salazar, who represents the 3rd Congressional District and Garfield County, has yet to declare support for the bill. … He had declared, “You could put hydraulic frac’ing out of business” with this kind of legislation, adding, “We’ve got plenty of bills in place. It’s the enforcement that’s the issue.”

Legislation to regulate Haynesville Shale Drilling. KSLA-TV. “Congressman John Fleming, while touring a drill site, gets about as close as a person can get to what’s called hydraulic fracturing, a process of releasing natural gas from the Haynesville Shale.” Click HERE or HERE to view this report.

SMU professor’s study on pollution from gas drilling is flawed, state says. Fort Worth Star Telegram. “As debate continues about how much gas drilling contributes to air pollution in North Texas, state regulators want to make sure it’s clear that they disagree with a study that concluded that drilling creates about as much pollution as car and truck traffic. The study by SMU professor Al Armendariz used data from the Texas Commission on Environmental Quality’s inventory of air pollution. Commission officials say that although his numbers might be correct, Armendariz took them out of context, and they think his conclusions are flawed. “I don’t know that we agree nor disagree with the numbers,” agency spokeswoman Andrea Morrow said. “We certainly don’t agree with the conclusions.”

Fed energy bill lights fire under natural gas. Denver Post. “When federal energy legislation was being crafted last spring, the natural-gas industry “was not at the bargaining table” and as a result was left out, said former Colorado U.S. Sen. Tim Wirth. Wirth’s comments Wednesday in a speech at the Colorado Oil and Gas Association’s annual conference echoed those of some top industry executives. “We as an industry really didn’t show up for this game,” Keith Rattie, chief executive of Salt Lake City-based natural-gas producer Questar Corp., said Tuesday.”

Brazilian official explores Pa. energy sources. Pittsburgh Tribune-Review. “Pittsburgh’s energy companies and a federal energy laboratory here were the major reasons a top Brazilian official visited Wednesday. Marcio Zimmerman, Brazil’s deputy minister of mines and energy, flew to Pittsburgh yesterday to learn about energy production and research from executives at Westinghouse Electric Co., Consol Energy Corp. and the National Energy Technology Laboratory in South Park. He spent Monday and Tuesday in meetings with counterparts in Washington before traveling here. … He was particularly interested during a presentation by state Department of Environmental Protection Deputy Secretary for Mineral Resources Management J. Scott Roberts about the state’s Marcellus Shale natural gas deposits, which has sparked major expansion in drilling and production. “What is the percentage of natural gas that is found in the Marcellus Shale?” And “is the Marcellus Shale natural gas environmentally the same as other natural gas?” Zimmerman asked. The answer is yes.”

 
State lawmakers spar over proposal to tax startup natural gas industry; deposits not under Berks. Reading Eagle. “Pennsylvania is considering taxing its fledgling natural gas drilling industry as a way to close budget gaps and set money aside for environmental cleanup. Debate on whether to impose a natural gas severance tax is part of the larger budget talks taking place in Harrisburg. One of the world’s largest deposits of natural gas lies beneath Pennsylvania in a formation known as the Marcellus shale. Energy companies have known about the gas for decades but only recently developed a profitable method to extract it.”

Energy in Depth: Today’s News

FRAC Act is ‘overkill legislation’. Grand Junction Free Press, LTE. “The COGCC through their new rules have made the reporting requirements more stringent (keep an inventory of chemicals on site and update that inventory quarterly). In addition, community right to know laws require that operators keep an up to date list of MSDS (material safety data sheets) available of chemicals received and stored for health and safety reasons. And, just for the record, Mr. Spehar in his article also indicates that there could be as much as 500,000 gallons of frac chemicals in an average well. That would mean, using his original quote that an average well uses 100,000,000 gallons of water. The true numbers are 100,000 gallons of water and 500 gallons of chemical that needs to be reported and monitored under EXISTING regulations. … The DeGette bill is overkill regulation which is why I encourage the rest of the Colorado delegation to not support it.”

Job growth expected from natural gas industry development. The Marcellus Shale Education & Training Center. “The developing natural gas industry in Pennsylvania will create jobs and offer opportunities for local residents who seek training and industry experience, according to the Marcellus Shale Workforce Needs Assessment released on Tuesday, June 23. … The report suggests that, depending on the intensity of development, between 1,292 and 2,153 direct, full-time jobs could be required in the Northern Tier ( Bradford, Sullivan, Susquehanna, Tioga and Wyoming counties ) this year to support well drilling and production. The number of jobs is expected to grow to between 2,107 and 3,511 by 2011 and to between 3,281 and 5,468 by 2013. In the Central Region ( Centre, Clinton, Columbia, Lycoming, Mifflin, Montour, Northumberland, Snyder and Union counties ), between 325 and 542 direct, full-time jobs are projected in 2009; that number is expected to increase to between 1,347 and 2,245 in 2011-13 as drilling intensifies in this region. In addition to these direct-employment projections, the Pennsylvania Economy League recently estimated that each direct job in the Pennsylvania oil and gas industry creates an additional 1.52 indirect jobs throughout the economy.” NOTE: See full report HERE.

Gas wells spreading across Ohio. Newark Advocate/Associated Press. “Gas wells have proliferated in northeast Ohio since the state took regulatory authority for drilling away from local governments in 2004, angering many residents who have little control because of lenient drilling laws. Critics say residents don’t have much power to keep rigs away because the boards that hear challenges to gas well locations consist largely of gas industry representatives. And the Ohio Department of Natural Resource is funded mainly by fees paid by the gas industry and with taxes paid for the gas that’s extracted. … The drilling industry agreed that Ohio laws are lax but said it has acted responsibly. “I would maintain vehemently that our environmental and social track record across the board has been very, very, very good,” said Tom Stewart of the Ohio Oil & Gas Association.”

Public invited to Marcellus Shale information session. Clearfield Progress. “The MSC encourages residents to learn more about the natural gas industry by attending this community meeting and obtaining information directly from the industry representatives,” said Rich Weber, MSC co-chair and president of Atlas Energy Resources. “Drilling for natural gas in the Marcellus Shale formation has the potential to positively impact Pennsylvania in a number of ways,” said Ray Walker, co-chair of the Marcellus Shale Committee and vice president of Appalachia Shale for Range Resources.”

Local Oil and Gas Veteran Welcomes Marcellus Shale Business Opportunities and Buzz. West Penn Energy Services. “Michael J. Zentz, an oil and gas industry veteran of more than 25 years, told a group of investors today that he has never seen anything like the current phenomenon the media has coined the “natural gas gold rush” — and that he sees the state poised to prosper from the Marcellus Shale boom for decades to come. Zentz is the President of West Penn Energy Services LLC, a firm local to Pittsburgh that provides oilfield services, such as pipeline construction, frac tank rental, excavation, trucking, water hauling and drilling rig moves. “The Marcellus Shale may very well turn out to be a field of dreams for Pennsylvania, and a provider of natural gas to the nation for years to come. It could take close to 50 years just to drill all of the wells,” says Zentz.”

Energy in Depth: Today’s News

Fracturing technique is safe. Bismarck Tribune & Minot Daily News, LTE by Robert Harms, president of the Northern Alliance of Independent Producers. “A recent letter by Tom Irgens falls short in accurately depicting the safety and necessity of a commonly used energy development technology known as hydraulic fracturing, where fluids under high pressure are injected thousands of feet below the water table to promote oil and natural gas production. This process is essential to develop the Bakken formation here in North Dakota. … Our government has a legitimate role to play in making sure hydraulic fracturing remains safe. Thankfully, it’s a role they’re already playing and have been for 60 years. Efforts to suggest otherwise not only miss the mark, but intentionally distract your readers from the potential jobs, revenues and energy security that lie ready and willing to be produced from the Bakken.”

Legislation to regulate Haynesville Shale Drilling. KSLA-TV. “Congressman John Fleming, while touring a drill site, gets about as close as a person can get to what’s called hydraulic fracturing, a process of releasing natural gas from the Haynesville Shale. … Fleming opposes upcoming legislation that he says would over- regulate the process. … “All we would do is add more cost not really to the company, to the consumer,” said Fleming. … In the 20 years that Chesapeake has been in business they’ve put literally miles of feet of drill pipe into the ground, the company argues that it hasn’t had one incident of contaminated water through this process, and what’s more, officials say state regulations keep the company in check. … “There are 12 people just in North Louisiana alone who inspect and make sure all those procedures are properly followed,” said Fleming.”

So Much for ‘Energy Independence’. Wall Street Journal, Robert Bryce. “Democrats want to cut drilling subsidies while simultaneously trumpeting their desire for “energy independence.” The cap-and-trade bill passed by the House aims to “create energy jobs” and “achieve energy independence.” Meanwhile, Democrats are calling to eliminate drilling subsidies that have encouraged advances in technology that have opened up vast new U.S. energy sources. These advances have made it profitable to extract natural gas from the Barnett Shale deposit in Texas and the Marcellus in Pennsylvania — deposits once thought too expensive to tap. … In May, Mr. Obama called the tax breaks for the oil and gas industry “unjustifiable loopholes” that do “little to incentivize production or reduce energy prices.” That’s flat not true. The deduction for intangible drilling costs encourages energy companies to plow huge amounts of capital into more drilling. And that drilling has resulted in unprecedented increases in natural gas production and potential. … Mr. Obama has been pro-ethanol and anti-oil for years. But he and his allies on Capitol Hill should understand that removing drilling incentives will mean less drilling, which will mean less domestic production and more imports of both oil and natural gas.”

Swimming in natural gas. Canada’s Financial Post. “The Haynesville, in the southern United States, and Marcellus, in the northeast United States, shales are considered the most economically viable resource plays in the United States, even at today’s depressed prices. New horizontal drilling technology has also unlocked shale plays in Canada, in places like Horn River and the Montney in northeast British Columbia. While development and drilling of many of these deposits has slowed because of the price downturn, their cost structures, reserve sizes and amount of production continues to lure both companies and investors.”

Energy in Depth: Today’s News

County opposes ‘fracking’ regulation. Fort Morgan Times. “All of Morgan County’s commissioners agreed that a new bill proposing to regulate hydraulic fracturing in oil production is a bad idea. They approved a resolution urging federal legislators to maintain an exemption “fracking” has had under the Safe Drinking Water Act. … County Commissioner Tony Carlson said that, although Morgan County does not have many active wells, he favors a resolution against the federal regulations because they would affect neighboring counties. The regulations would affect Morgan County businesses which supply equipment and services to oil fields, said County Commissioner Brian McCracken. “We need to do whatever we can to help,” he said.”

Tapping into natural gas can improve state economy. Denver Post, Op-Ed. “Colorado is blessed with many natural resources, including an abundance of natural-gas reserves. The nation, in fact, has experienced a profound change in the supply of natural gas. … Over the past two years, continental natural-gas production has grown 9 percent solely because of new shale-gas discoveries in states such as Texas, Louisiana and Pennsylvania. Advanced, proven technologies such as horizontal drilling and hydraulic fracturing provided the impetus to make these new “shale plays” viable. … North American natural-gas supplies are abundant, affordable and clean. They can play an integral role in reducing greenhouse-gas emissions and lessen our dependence on hostile foreign-oil sources. Colorado can strengthen its economy and job base by using more of its natural gas intra-state, with supplies that are currently exported to other states.”

Marcellus Shale brings more energy companies to Pittsburgh area. Pittsburg Business Times. “How many companies does it take to power a light bulb with natural gas? About 30, according to some estimates: one utility company to supply the electricity to consumers and 29 others to drill the natural gas wells, fracture the Marcellus Shale formation that has been driving energy firms to southwest Pennsylvania by the dozens, gather the gas, process it and pipe it to the utility lines.”

Investing in the Pickens Plan, One Year Later. Seeking Alpha. “Based on a June 2008 study by Navigant Consulting, the U.S. has enough natural gas reserves to last more than 100 years. New drilling technologies such as hydraulic fracturing are unlocking substantial amounts of natural gas from shale rocks. For example, the Haynesville shale play is expected to produce 7 to 8 billion cubic feet of gas a day by 2016. In fact, the amount of natural gas available for production in the U.S. has soared 58% in the past 4 years.”

Region sees beginning of widespread energy boom. Pittsburgh Tribune-Review. “This time, there are no gushers spilling oil everywhere. No farm villages that become boom towns overnight, only to empty out as wells start running dry. Western Pennsylvania is at the start of what could be a longer, more widespread energy boom and period of influence than the frenzied time 150 years ago this August when America’s oil industry was founded in the Titusville area. … Natural gas drilling in the Marcellus Shale region covering more than half the state and parts of New York and West Virginia has slowed somewhat from last year because of lower prices, but experts said it eventually could turn out enough natural gas to sustain demand across the United States for 12 years or longer. … New drilling technologies make the Marcellus Shale formation – 6,000 feet or more underground – reachable, and rising demand in recent years makes going after it worthwhile. About 500 Marcellus wells have been drilled so far in Pennsylvania. Drillers from Texas, Louisiana and other states have been working here temporarily, but the companies are hiring and training local workers and could create about 8,000 jobs this year. Texas-based gas producer Range Resources LLC opened an office in Cecil, Washington County, with one employee in January 2007 and now has 130. … Another producer, Atlas Energy Resources LLC, has more than doubled its local work force to around 200 in Smithfield, Fayette County, plus 75 at its headquarters in Moon. … Texas-based Red Oak Water Transfer has 42 workers here so far, is moving into a new building in Hickory, Washington County and could hire 50 to 100 more employees in the next couple years, said Keith Ryals, operations manager.”

Technique used in area fields could unlock ‘astronomical’ amount of natural gas. Longview News Journal. “The quest for natural gas has been called this century’s gold rush, and more area gas companies are getting creative in their extraction techniques. Instead of conventional downward drilling, the companies are going the way of their offshore counterparts – horizontally. … Morgan said slant drilling allows companies to hit rich deposits of natural gas at a slant with a drill bit controlled by a computer. Once the hole is set, he said gas contractors blast water and sand into the hole, cracking the rock and extracting the gas, known as fracing. Morgan said slant drilling has transformed the U.S. natural gas industry. “It changed everything for the U.S. drilling scene overnight,” Morgan said. “The amount of gas companies can now access using this technology is astronomical.” … Devon Energy spokeswoman Alesha M. Leemaster said her company plans to increase horizontal drilling operations within the East Texas formation of the Haynesville Shale, which lies beneath much of Harrison, Shelby, Rusk, Marion, Panola and Nacogdoches counties. The deposit also stretches to Caddo, DeSoto and Bossier parishes in northwestern Louisiana.”

New Study Attaches Real-World Numbers to Real-World Consequences of DeGette/Casey

IHS study finds elimination of hydraulic fracturing could cost 364K jobs in TX, 292K in CA, 250K in PA and NY

As communities across the country continue to speak out against a proposed plan in Congress to impose unprecedented new restrictions on the safe, already well-regulated process of hydraulic fracturing, a new study released this week by IHS Global Insight and the American Petroleum Institute (API) sheds new light on what those communities can expect if those efforts ultimately prove successful.

“Hydraulic fracturing has been safely and effectively used for more than 60 years now, but at no point has this technology been as directly tied to jobs, revenue and U.S. energy security as it is today,” said Lee Fuller, policy director for Energy In Depth. “The study released this week underscores that point in clear and compelling detail, and strengthens the suggestion that when it comes to imposing extraordinary new regulations on this common and increasingly critical energy technology, we better look before we leap.”

The report, the second in a series of three studies commissioned by API examining the critical role that hydraulic fracturing plays in delivering a secure energy future, projects the potential impacts – broken down by state – assuming three separate (and plausible) scenarios under which EPA could regulate fracturing activities.

First scenario: Expansion of Underground Injection Control (UIC) program to include the EPA regulation of hydraulic fracturing

Under this scenario, hydraulic fracturing and the materials related to the process would in effect be treated the same way as the law treats hazardous wastes for the purposes of permanent disposal.  Including hydraulic fracturing activities in this category of regulation violates both the intent and design of the law, and as such, could result in the following impacts:

Second scenario: New restrictions on materials used in fracturing a well

Although water and sand comprise 99.51% of the materials used in a typical frac job, efforts to hand over the job of regulating this crucial technology to EPA could also lead to new restrictions on the types and quantities of additives used by operators to alter the surface tension of the fracturing fluids.

Under that scenario, the IHS report predicts that states such as Wyoming and Louisiana would be hardest hit:

Third scenario: Elimination of hydraulic fracturing

Although characterized by its authors as a “commonsense” effort to promote new reporting and disclosure requirements on operators who use fracturing technology, the actual text of the FRAC Act of 2009 fails to align with that description.

In spirit and in letter, H.R. 2766 is about EPA regulation, not disclosure – with section 2(a) of the bill clearly amending the Safe Drinking Water Act (SDWA) of 1974 to include the regulation of hydraulic fracturing under its portfolio. With SDWA regulation comes EPA permit-authority over the process, a prospect that then-EPA administrator Carol Browner admitted was unnecessary in 1995.

According this scenario, the IHS study suggests the following impacts would follow:

More resources and materials from Energy In Depth:

• API Press Release: Duplicative hydraulic fracturing rules could imperil U.S. economy

• Graphic: How Far Down Do We Frac?