Energy in Depth

Okla. Paper: Hydraulic fracturing a necessity

As opponents of responsible natural gas development move into a new phase of attack against the essential tool (hydraulic fracturing) that makes such development possible, Americans outside our nation’s capital are taking notice. Slowly but surely, they’re starting to arrive at the fact that, without this critical, 60-year-old technology, abundant reserves of clean-burning, American-made resources would immediately become inaccessible, resulting in massive job loss, higher energy costs, and greater dependence on foreign nations for the lifeblood of our economy.

Oklahomans have been producing natural gas safely and efficiently for decades. But Rep. DeGette’s legislation now threatens our energy security, and threatens the livelihoods of working-class families across the country, especially in Tulsa’s energy-rich region.

Today’s Bixby Bulletin highlights these very real economic threats:

“The proposed legislation would make drilling new oil and natural gas wells more difficult and more costly, limiting the number of wells drilled in Oklahoma and the amount of oil and natural gas the state produces. … Regulations to protect groundwater during oil and natural gas production are in place in Oklahoma through the Oklahoma Corporation Commission. Hydraulic fracturing has been in use for more than 50 years and a 2004 study conducted by EPA found that the practice posed “no threat” to underground drinking water supplies.”

The paper also quotes Mike McDonald, chairman of the Oklahoma Independent Petroleum Association (OIPA):“Hydraulic fracturing is a necessary part of Oklahoma’s crude oil and natural gas industry, and federal attempts to add new restrictions to the technological process will have devastating effects on the state’s economy.”

Energy-producing communities are not the only ones taking notice. Law360 reports that:

“Chris Tucker, a spokesman for the industry group Energy In Depth, said on Wednesday the legislation appears to be a bid to subject hydraulic fracturing to federal regulation – not just disclosure.”

The article also added that: “Industry officials have said that there have been no instances of injury or harm resulting from hydraulic fracturing.”

Opponents of hydraulic fracturing opponents continue to find themselves on the other side of the facts. Whether that eventually slows any of them down – that’s anyone’s guess.

Energy In Depth: Today’s News

Hydraulic fracturing a necessity for Oklahoma’s energy economy. Bixby (OK) Bulletin. “Hydraulic fracturing is a necessary part of Oklahoma’s crude oil and natural gas industry, and federal attempts to add new restrictions to the technological process will have devastating effects on the state’s economy, said Oklahoma Independent Petroleum Association (OIPA) Chairman Mike McDonald. … The proposed legislation would make drilling new oil and natural gas wells more difficult and more costly, limiting the number of wells drilled in Oklahoma and the amount of oil and natural gas the state produces. … Regulations to protect groundwater during oil and natural gas production are in place in Oklahoma through the Oklahoma Corporation Commission. Hydraulic fracturing has been in use for more than 50 years and a 2004 study conducted by EPA found that the practice posed “no threat” to underground drinking water supplies.”

Restoring fed reg of gas drilling: praised, booed. Wayne (PA) Independent. “Federal legislation now under discussion in Washington would impose rigorous environmental regulations on natural gas drilling while seeking to protect drinking water from contamination which has reportedly occurred because of the industry’s activities. “It’s incredibly stupid, unnecessary and burdensome,” said Steve Rhoads, president of the Pennsylvania Oil and Gas Association, an industry group. “We’ve been fracking (drilling) wells since the 1940’s. There have been very few incidents or problems.” “We have very strong laws in place in Pennsylvania,” said Rhoads. “(EPA permits) would be one more hurdle that could be debilitating.”

DeGette, Polis introduce FRAC Act aimed at closing hydraulic fracturing ‘loophole’. Colorado Independent. “Using some rather pointed language aimed at Bush administration energy policies in general and former Vice President Dick Cheney in particular, Colorado Rep.’s Diana DeGette, D-Denver, and Jared Polis, D-Boulder, Tuesday introduced the FRAC Act aimed at closing a natural-gas drilling loophole in the Safe Drinking Water Act. Pro-industry forces have been mounting a massive counter-campaign, with Energy In Depth Monday sending out a release accusing DeGette of ignoring science and praising 3rd District Congressman John Salazar for wavering on the bill. “Despite the EPA reports from the Clinton and Bush administration, and even though there have been no documented cases of fracking contaminating drinking water, a DeGette spokeswoman said legislation is needed because there is anecdotal evidence of people becoming sick as a result of fracking,” the release read.

Bill would regulate oil, gas fracturing. Grand Junction Sentinel. “In a news release Tuesday, the new industry advocacy group Energy In Depth said it’s wrong to say hydraulic fracturing was exempted from the Safe Water Drinking Act because regulation of the practice never was contemplated when that law was passed or during later debates over amendments to it.”

Lawmakers Push Hydraulic Fracturing Disclosure Law. Law360. “As energy companies push to keep states in charge of regulating natural gas extraction, Democrats on Capitol Hill are pushing back with bills that would roll back an exemption that protects the oil and gas industry from disclosing chemicals used in a production method called hydraulic fracturing. … Chris Tucker, a spokesman for the industry group Energy In Depth, said on Wednesday the legislation appears to be a bid to subject hydraulic fracturing to federal regulation – not just disclosure. “Either the authors of this bill aren’t aware of what the practical implications of their legislation will be, or they are – and are simply mischaracterizing the nature of this effort,” Tucker said. “This bill is about regulation, not reporting.” Tucker added that the U.S. Environmental Protection Agency “doesn’t have the staff or regulatory apparatus in place to even be able to accept permit applications for hydraulic fracturing” and said, because of that, such legislation would delay operations and cost jobs.”

States Challenge Attempted Federal Power Grab in Hydraulic Fracturing Issue. Interstate Oil and Gas Compact Commission. “The Interstate Oil and Gas Compact Commission (IOGCC) reaffirmed its strong stance today that the states remain the best positioned to regulate the use of hydraulic fracturing for the production of oil and natural gas. “The states do a superb job of protecting human health and the environment through sound regulation,” said Carl Michael Smith, IOGCC executive director. “An unnecessary shift to federal regulation of hydraulic fracturing could greatly inhibit the production of much-needed oil and natural gas resources at a time when our nation’s energy security is critical.”

Energy in Depth: Today’s News

The Business Council: Why Albany Should Start Paying Attention! Jennifer K. Levine writes that “development of the vast natural gas reserve in the Marcellus Shale is one of Upstate’s best hopes for economic recovery.” She also writes on the benefits of hydraulic fracturing and horizontal drilling.

Wayne Independent: DEP Reviewing More WC Gas Drilling Requests. “Two more drill permit applications are now being reviewed by the state Department of Environmental Protection (DEP)” in Wayne County, Pennsylvania.

Energy in Depth: Today’s News

The State Journal (WV): Officials Hope Brine Pilot Project Helps Other Cities. “A pilot project that allows a Clarksburg wastewater treatment plant to accept gas well drilling brine could lead to other municipal systems making money from the Marcellus gas boom. After months of study, the state Department of Environmental Protection soon may recommend permit modifications for a Clarksburg wastewater treatment plant that is accepting gas well drilling brine. It’s a pilot project that Plant Manager Bill Goodwin hopes will help other municipal systems make money from the Marcellus gas boom. ‘It keeps everybody’s rates down,’ Goodwin said. ‘We have a $1.5 million budget. This is generating between $200,000 and $400,000,’ he said.”

Oil & Gas Journal: EIA Global Outlook Sees More use of Unconventional Fuel Sources. The US Energy Information Administration reported in its International Energy Outlook that unconventional sources including biofuels could provide nearly half of the growth in global liquid fuel supplies in the coming decades. “Unconventional gas production from both tight sand and shale formations could increase from 47% of the US total in 2006 to 56% in 2030,” the report continued. “There’s no question that the gas growth we see in the US from tight sands and shale depends on hydraulic fracturing. If that’s taken off the table, the impact would be profound,” Acting EIA Administrator Howard K. Gruenspecht said.

Wellsboro Gazette: Gas Could Fuel Hotel Boom. It’s getting harder and harder to find a hotel room in the gas producing areas of the Marcellus. As gas production activities grow, the need will become even greater. Fortuna Energy Inc. is expanding activities in the area, and its spokesperson says the company is having difficulties finding places for its workers to stay.

Energy in Depth: Today’s News

Shreveport Times: Bossier City Planning to Build Public, Natural Gas Pumps. “As gas prices creep up slowly, Bossier City officials are working to get natural gas pumps in the city for the public,” reports the Shreveport Times. “While city vehicles prepare to run on natural gas, [Mayor] Walker said he would like to then see two additional pumps added, one in the northern part of the city, and one in the southern part, ready to be used for public vehicles. Besides natural gas pumps, the city envisions making these pumping stations ready to dispense at least ethanol fuels in addition to natural gas, said Rodney Oar, director of Fleet Services for Bossier City.”

The Daily Review (Upstate, NY): Informational Meeting to be Held on Natural Gas Development in County. The Marcellus Shale Committee will hold a community information session from 6:30 p.m. to 8:30 p.m. on Wednesday, June 3, in Troy, New York.

Energy in Depth: Today’s News

Contra Costa Times: Editorial: A Huge Boost for Cleaner Energy. The Contra Costa Times editorializes that natural gas can be “a realistic bridge from where the nation is now, with its heavy dependence on oil and coal, to a future with sufficient supplies of green power from biomass, solar, geothermal, wind, tidal and other renewable energy sources.”

Albany Times-Union: Mine Marcellus to Boost Energy. In a letter to the editor, local citizen Jennifer Levine of Delmar writes: “The scare tactics employed by environmental groups…are based on isolated incidents of water-well contamination not definitively linked to hydraulic fracturing…Concerned New Yorkers should check out the U.S. Department of Energy’s publication, ‘Modern Shale Gas Development in the United States: A Primer (April 2009),’ to learn how gas is extracted from shale. The facts and science will put their minds at ease…Development of the Marcellus Shale will revitalize the upstate economy and help our nation in becoming energy independent.”

Energy in Depth Issue Alert: Issue: Rep. Hinchey, EPA Administrator Jackson, HF, SDWA

On Tuesday, May 19, the office of U.S. Rep. Maurice Hinchey (D-N.Y.) issued a press release subsequent to a hearing of the House Interior Appropriations Subcommittee suggesting the congressman had gotten EPA administrator Lisa Jackson to “acknowledge” the need for her agency “to reexamine the Bush administration’s misguided views on the risks associated with hydraulic fracturing.”

Context

In 2005, Congress passed (with the vote of then-Sen. Barack Obama) the Energy Policy Act, a key provision of which sought to clarify Congress’s historical intent on whether the Safe Drinking Water Act (SDWA) of 1974 was ever designed to regulate hydraulic fracturing.

The answer was no, and in this case, history proved an effective guide: When SDWA was passed in 1974, hydraulic fracturing had already been in use for 25 years. Hydraulic fracturing was never considered for inclusion under SDWA jurisdiction at the time. The Act was amended in 1986, and then again in 1996. At no point in the process was the concept of SDWA regulation over fracturing ever considered a necessity – or even a possibility.

Subtext

Hydraulic fracturing is a commonly used, and increasingly critical, technology for finding and developing oil and gas resources trapped below rock that would otherwise be too deep, too hard and too expensive to access. The technique has been deployed more than a million times over the past 60 years, delivering to the American people more than 600 trillion cubic feet of American natural gas and seven billions barrels of American oil.

In 2008, a report issued by professors from Pennsylvania and New York suggested that the Marcellus Shale formation, a unit of sedimentary rock spread across much of the Appalachian Basin, could contain 516 trillion cubic feet of natural gas – enough to heat more than 60 million homes for 160 years. Without hydraulic fracturing, these resources cannot be feasibly or economically produced.

Politics

Those who oppose the responsible development of American energy have seized on hydraulic fracturing as a means of blocking reasonable access to, and production of, domestic energy resources. The centerpiece of their campaign appears to be focused on blaming hydraulic fracturing for everything from exploding houses in Ohio, to flammable water in Colorado, to hard water deposits in New York (each of these accusations, and others, are debunked here).

Despite these claims, hydraulic fracturing continues to be aggressively regulated by the states, and has compiled an unparalleled record of safety over the 60 years since its first commercial use.

Economic Impacts

More recently, legislation co-sponsored by Rep. Hinchey has sought to destroy this existing state-federal regulatory partnership in favor of an EPA-only approach. Were this and other restrictive regulatory measures to come to pass, a recent analysis showed it could result in the forced closure of more than half of America’s oil wells, a third of its gas wells, cost the federal government $4 billion in lost revenue, slash American oil production by 183,000 barrels per day, and natural gas by 245 billion cubic feet per year.

EPA on Record

In 1995, then-EPA administrator Carol Browner (currently the president’s energy and environment czar) wrote that that her agency saw “no evidence” that hydraulic fracturing “has resulted in any contamination or endangerment of underground sources of drinking water (USDW).”

“Moreover,” she added, “given the horizontal and vertical distance between the drinking water well and the closest gas production wells, the possibility of contamination or endangerment of USDWs in the area is extremely remote.”

In 2004, EPA issued a landmark report examining the question of safety as it relates to hydraulic fracturing, finding “the injection of hydraulic fracturing fluids” poses “minimal threat to USDWs.” In arriving at that conclusion, EPA stated it had “reviewed more than 200 peer-reviewed publications, other research, and public comments.”

States on Record

Recognizing that hydraulic fracturing is both a safe technology and a key driver of local economic development, states such as Alabama, Louisiana, North Dakota, Utah, Wyoming, Oklahoma and Texas have recently taken up or passed resolutions informing Congress and EPA that the current regulatory relationship is working well, and that efforts to disrupt it could produce serious and long-term consequences.

In New Mexico, former U.S. Energy Secretary and current Governor Bill Richardson introduced a plan in February aimed at easing unnecessary compliance burdens, recognizing that thousands of jobs and millions in potential revenue were tied to safe, responsible, state-regulated natural gas and oil production.

Statement from Lee Fuller, policy director for Energy In Depth

“Those familiar with the history surrounding the passage and amendment of the Safe Drinking Water Act understand what this measure was intended to do, and what it clearly was not. Unfortunately, instead of taking on the issue of responsible energy development candidly and on its merits, opponents of natural resource development have decided to target the essential tools needed to safely and efficiently bring this energy to market.”

States to U.S. Congress: Hands Off Hydraulic Fracturing

As Waxman, DeGette consider handing regulatory reins over to EPA,state legislatures speak up in support for maintaining,strengthening current state-federal partnership

WASHINGTON, DC – As their federal counterparts in Washington, D.C. look for new and creative ways to restrict the responsible use of a critical natural gas and oil extraction technique known as hydraulic fracturing, states with decades of experience in regulating the technology are not taking the effort lying down.

Earlier this week, the Louisiana House became the latest in a string of legislatures where resolutions affirming the chamber’s support for hydraulic fracturing – or opposition to Congress’s effort to disrupt the current partnership – were either formally filed or broadly approved. Many of these states have effectively regulated fracturing activities for more than a half century, and stand to lose the most – in jobs, revenue, royalties and energy output – should EPA be given regulatory authority over the proven technology. To learn more specifics about hydraulic fracturing technology, click here.

“If hydraulic fracturing were unsafe, unregulated, and largely unnecessary as a tool of producing American energy, Congress would have a good reason to step in, and states would have an even better one to step out,” said Lee Fuller, a spokesman for Energy In Depth, a new coalition of American oil and natural gas trade groups. “Clearly, that is not the case. And that’s why you’ve seen states from the Southeast to the Intermountain West stand up, shoulder-to-shoulder, and affirm their support for this safe, critical and increasingly valuable well stimulation technology”.

The latest effort out of Baton Rouge, La. was introduced by Rep. Joe Harrison, R-Napoleonville, and calls on Congress to maintain a provision in existing federal law preserving Congress’s intent not to regulate hydraulic fracturing under the Safe Drinking Water Act (SDWA) of 1974, legislation designed to protect public water supplies. In 1974, hydraulic fracturing had already been in commercial use for 25 years. At no time during its deliberation, nor in subsequent debates on amendments to SDWA in 1986 and 1996, was the concept of regulating hydraulic fracturing under SDWA ever a consideration.

The reason? Hydraulic fracturing was then, and continues to be now, aggressively regulated by the states, compiling an impressive record of safety and performance over that time. More than 60 years after its first commercial use, not a single case of hydraulic fracturing-related contamination has been documented by the federal government. In fact, a landmark 2004 study conducted by EPA found that hydraulic fracturing posed “no threat” to underground drinking water supplies.

Because of that, other states – such as Alabama, North Dakota, Utah, Wyoming, Oklahoma and Texas – have taken up or passed resolutions similar to the one being considered in Louisiana. In New Mexico, former U.S. Energy Secretary and current Governor Bill Richardson introduced a plan in February aimed at easing unnecessary compliance burdens, recognizing that thousands of jobs and millions in potential revenue were tied to safe, responsible, state-regulated natural gas and oil production.

Those conclusions are supported in full by a recent set of studies known collectively as Project BRIEF (Bringing Real Information on Energy Forward), commissioned by the Energy in Depth coalition. In particular, BRIEF found that proposed changes to federal regulations, including those related to hydraulic fracturing, could result in:

• The forced closure of more than half of America’s oil wells, and a third of its gas wells
• $4 billion in lost revenue to the federal government; state treasuries would lose $785 million
• Domestic oil production slashed by 183,000 barrels per day; natural gas by 245 billion cubic feet per year

Energy in Depth: Today’s News

NWLANews.com: It is Just that Huge!; Haynesville Shale Economic Impact Could Mean Billions. NWLA News writes on the Louisiana Department of Natural Resources study showing the potential economic benefits of developing the Haynesville Shale. “The report estimates that…extraction activity…generated approximately $2.4 billion in new business sales within the state of Louisiana last year. New business sales in turn created new household earnings of close to $3.9 billion for state residents. This estimate includes both direct and indirect earnings and includes almost $3.2 billion in lease and royalty payments to private landowners…The job multiplier is remarkably large in this case due to the fact that $3.2 billion in lease and royalty payments were injected into the state’s economy by the extraction firms. The conservative estimate is state and local tax revenues increased by at least $153.3 million in 2008 due to the extraction activities in the Haynesville Shale.”

Williamsport Sun-Gazette: Misinformation About Pine Creek Water Drawdown Brings Big Crowd. “More than 100 people turned out for a hastily called meeting Monday with representatives of the Susquehanna River Basin Commission as the result of a headline in a Tioga County newspaper last week indicating that three quarters of the water in Pine Creek was going to be drawn out for natural gas exploration.” The actual amount being drawn out is actually less than 0.25 of 1 percent of the water that flows through the creek.

Shreveport Times: Caddo May Hire Stimulus Experts, Lease More Property for Drilling. The Caddo Commission may lease about 500 more acres of public property for oil and gas drilling, with a final decision coming as early as June. “Commissioners, who are mulling proposed parish and state drilling regulations in response to harvesting the Haynesville Shale’s resources, moved the lease item onto the voting agenda with no discussion. Most of the land is roads and rights of way in southwest Caddo, parish Public Works Director Robert Glass said.”

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