The CBS Early Show this week highlighted how the development of the nation’s shale resources, including the Marcellus Shale, are keeping our economy alive by providing up to a million jobs for residents in states where safe and responsible natural gas development is taking place.  In the series,  Rebecca Jarvis visits with our friends at Chesapeake Energy, the second largest natural gas producer in the U.S. with an extensive presence in the  Marcellus, tours their field operations and conducts and in-depth interview with the company’s CEO Aubrey McClendon.  Rebecca even manages to get some face time with renowned industry consultant Daniel Yergin which provided great perspective for the piece and made the entire EID-Northeast Marcellus team a bit jealous.  More after the jump.

Domestic Benefits Abound

Mr. Yergin sums up the benefits the U.S is gaining from natural gas production in a succinct way that only he can given his extensive knowledge of the energy industry and its impacts on society.  Yergin declares:

What the move to inexpensive natural gas does is provide a tremendous boost to our economy.  It means electricity prices are lower, gas prices are lower, it means companies that would have gone overseas to build new factories are building them in the United States.

Indeed, nowhere is this impact being experienced more broadly than in the Commonwealth of Pennsylvania.  In just the past few months, reports have highlighted that Pennsylvania is home to two of the fastest growing counties in terms of job creation as well as the 7th fastest growing metropolitan area in the United States.  All of this growth is largely attributable to the safe and responsible development of the region’s natural gas resources.  Building on this momentum, the Pennsylvania Department of Labor recently released their latest version of “fast facts” associated with job growth in the Commonwealth due to natural gas development.  The figures show what most already know, responsible development of the Marcellus Shale is changing folks lives for the better with most recent figures pointing to the natural gas industry supporting 214,000 jobs across Pennsylvania with the average wage being close to $70,ooo per year.

International Gamechanger

Jarvis not only touches on domestic benefits but also highlights how safe and responsible development  is transforming world energy markets.  For example, she references the fact that in 2009 the United States surpassed Russia as the world’s largest producer of natural gas.  An incredible fact in and of itself becomes even more so when less than a decade ago many of the most credible experts agreed that our future with natural gas would be short-lived as we were running out of the resource.

This topic was touched on previously in a report commissioned by the James A. Baker III Institute for public policy entitled “Shale Gas and U.S. National Security“.  The report found, among other things, that development of the United States shale gas resources has already significantly reduced the nation’s need to import natural gas from areas like the middle east, has lowered the nation’s natural gas prices significantly and has provided the european continent with a more diverse supply of natural gas as exports that were once  U.S. bound are now freed up for other destinations.  This last development alone has led to significant price reductions and has drastically changed the previous dynamic of the entire European continent relying on mainly one nation, namely Russia, for a large majority of their supply of this needed resource.

Few Critics Push Back

On day two of their series CBS highlighted the viewpoints of some industry critics.  Specifically, Carolyn Knapp and Carol French, two Bradford County landowners who previously leased land for natural gas development and are now engaged in a speaking tour against shale gas development. Of course this criticism wasn’t the blazing indictment that critics like Josh Fox would salivate over and much of it was based on intellectual sophistry from the viewpoint of two rural Pennsylvania residents.  While everyone is, of course, entitled to their opinion we thought we would break down their criticisms and provide a little needed context for those who choose to base decisions on aggregate experience rather than individual viewpoints.

Claim #1:  “Alot of the land that would have had years and years of agriculture use is now being turned into either a gas pad, a road, or impoundment pond.”

Fact: At the surface one could identify with this statement if they were unfamiliar with natural gas operations.  The fact of the matter however is much different.  Nearly every aspect of the natural gas production process is temporary.  In fact, the land utilized for wellpad construction is reclaimed and remediated resulting in an area of less than 3 acres where any surface disturbance could be noted.  Even then, the only remaining visible items are a christmas tree valve which is about 3 feet in height,  some small separating equipment, two collection tanks and a fence surrounding the perimeter.  For additional perspective, many farms, like the one Mrs. Knapp leased, have sizeable estates at or exceeding 200 acres so the loss of less than 3 acres isn’t even a blip on the radar screen.  As for the roads, the only new roads created are ones to access the pad and these too are mitigated upon completion.  Pre-existing county and state roads are often left in better condition than when they were found as a result of investments from natural gas companies.  For example,  one producer, Chesapeake Energy, spent $250 million in roadway improvements in just 5 counties over the course of two years providing a tremendous long-term asset to these local communities.

Claim #2: “Money Can Not Satisy My Thirst”

Fact: Well this one is true, unless of course you buy a drink to quench your thirst.  The underlying thought in this statement however is that natural gas production impacts groundwater supplies.  This is not true.  In fact,  there are countless sources and studies that all agree to this fact including U.S. EPA Administrator Lisa Jackson, regulators in over 15 states and most recently a comprehensive study conducted by the Pennsylvania State University.  In fact, after sampling over 200 water wells throughout the Commonwealth in close proximity to natural gas operations researchers found:

statistical analyses of post-drilling versus pre-drilling water chemistry did not suggest major influences from gas well drilling or hydrofracturing on nearby water wells, when considering changes in potential pollutants

Claim #3 [by Jarret]: “In the process [of hydraulic fracturing] traces of frac fluid, filled with metals and chemicals, has risen to the surface prompting concerns about ground and drinking water contamination.”

Fact:  After a hydraulic fracturing operation is complete approximately 10-30% of the fluid used for fracturing returns, in a controlled fashion, back up the wellbore where it is collected via a closed loop system, stored in steel tanks and then shipped for treatment and utimately re-used in other fracturing operations.  At no point does this “flowback” have an opportunity to interact with groundwater basins or the natural environment.  In addition, hydraulic fracturing fluid is composed primarily of water and sand (99.5-98%) with the remainder being a handful of chemical additives that aid in lubrication and in ensuring that organisms in the deep earth do not disrupt the fracturing process.  Additives for individual wellpads can be found on the website www.fracfocus.org and many consist of commonly used items often found in products like ice cream, toothpaste or other household cleaners.  A full breakdown can be found here and is also provided below.

Claim #4:  “With the activity on the last five wells when drilling, or else when fracturing a well, our water went to a real white soap in it and has that “pearly” look, it would last maybe a day or two”

Fact:  Having grown-up in northeastern Pennsylvania I am no stranger to turbidity issues in private water wells.  I can fondly remember the days where I would visit a friend and bottled water was a must due to sediment filled, sometimes brown and sometimes effervescent and cloudy water.  Temporary problems of “a day or two” in water wells occur quite often in this part of the country independent of natural gas operations and are often a result of wells that are not properly designed.  This is quite common in Pennsylvania as the state lacks any standards for water well construction and maintenance.  In fact, the recent Penn State survey mentioned earlier found that a staggering 23% of water wells surveyed lacked at least one critical construction component that seals water wells from outside contaminants.  As a result, the study found that 40% of water wells surveyed did not meet drinking water standards for at least one contaminant listed by the U.S. Environmental Protection Agency in the Safe Drinking Water Act.

Wrap-Up

Overall this showcased the transformation natural gas production is helping to bring to global energy markets, the United States and local commuities where this resource is being responsibly developed while providing a counterpoint from two critics in Bradford County, Pennsylvania.  One thing that is worth mentioning is that the two critics selected, Mrs. Knapp and Ms. French, should probably should be more discriminatory in the outreach they employ in their on-going tour to raise doubts about natural gas production.  Why? well one of these individuals has publicly declared that she would sign another lease if approached which would lead one to believe her experiences couldn’t have been all that bad.  But more importantly, the other individual is currently engaged in a lawsuit with a natural gas producer.  Why? Not because of the day or two alleged damage to her water well but rather because she and her husband are in a fight over what the royalties will be on the natural gas well developed on their property.