Dispute has industry, mineral owners nervous

BY JOHN-LAURENT TRONCHE

July 07, 2008
Ft. Worth Business Press
July 10, 2010

One name above all others strikes fear into the hearts of Texas oil and gas operators: Garza, or more specifically, the Supreme Court of Texas case No. 05-0466, Coastal Oil & Gas Corp. and Coastal Oil & Gas USA LP v. Garza Energy Trust, et al.

The lawsuit stems from a 2005 Hidalgo County dispute in which Garza Energy Trust was granted $14 million for the court's findings that the trust had been the victim of subsurface trespass due to hydraulic fracturing.

Hydraulic fracturing is a process in which a sand-water mixture is pumped down the well-bore, thousands of feet down to crack and split the shale, providing access to the natural gas stored within the formation. Without hydraulic fracturing, little gas can be retrieved.

The problem is, however, that fracture stimulation isn't a precise science, and doesn't always crack the shale in equal portions. In some ways, cracking the shale evenly could be thought of as trying to hammer a dinner plate into equal pieces - it's not easy.

"You may plan a fracture that will go 1,000 feet, and it might go 2,000 feet or 400 feet," said John S. Lowe, a professor of energy law at Southern Methodist University's Dedman School of Law.

In the Garza case, the 332nd District Court of Hidalgo County determined in 2005 that Garza had been the victim of subsurface trespass when Mission Resources Inc. (later acquired by Coastal) fractured the rock below and, in doing so, crossed over into property belonging to Garza.

In an appeal to the Texas Appellate Court of Corpus Christi, the pro-Garza ruling was upheld, prompting a second appeal that has made its way to the top of the judicial dog pile, the state's Supreme Court in June 2005, where it has remained for several years awaiting a decision. Industry officials say a decision could come at any time.

No matter which way it goes, that forthcoming decision could have far-reaching repercussions.

Trouble down below

The issue at hand is a difficult one to address, said John Holden, a partner at Dallas-based Jackson Walker LLP.

The burden of proof lies in the hands of both Garza and Coastal. Garza must prove Coastal knowingly trespassed whereas Coastal must prove the opposite, or show that Garza sustained no damages in the process.

But knowing what has happened thousands of feet below isn't easy.

"How do you prove any fracing was correct or incorrect in an area that is not precise to begin with?" asked Holden, who has practiced natural resources and energy law for more than 30 years. "Either side has to prove what's going down below, and that's hard for both sides."

Lowe agrees the case is a tricky nut to crack.

"It's possible to ascertain [the trespass]," Lowe said. "You can bring the scientific evidence, the scientific testing to see whether or not a trespass has occurred but I'm not sure you can rely on it 100 percent."

In short, the situation presents a Catch-22 dilemma in which no ruling would present a clear winner.

Should the court rule in favor of Coastal, reversing the two lower courts' decisions, then it deviates from standard, above-ground trespassing cases, Lowe said. But if the Supreme Court again rules in favor of Garza, then post-decision drilling will become significantly more conservative.

"The next guy who plans a frac job in Fort Worth is going to be told by his bosses, "You better be damn careful that you do not cross over the property line," Lowe said. "So how do you do that? Well, you just hold back. So that means you're less likely - maybe - to efficiently fracture, and then society pays because we will leave more oil and gas in the ground."

Big oil and gas weighs in

In July 2005, Chesapeake Energy Corp.'s Raymond Roush, senior attorney, sent a letter to the state's Supreme Court on behalf of some of the oil and gas industry's heaviest hitters to express deep concern "over the potentially devastating impact" a ruling in favor of Garza could have.

"The effect on the economy of the state of Texas if the decision in this case is left to stand will be devastating," Roush wrote in the statement, "and the impact on the nation's developed reserves of oil and gas put into question at a time when the United States of America needs more than ever to be as energy self-sufficient as it can."

Writing for the Independent Producers Amicus Group, Roush predicts nothing short of Judgment Day for the industry should the ruling stand.

"The decision of the trial court and the Thirteenth District Court of Appeals … must not be allowed to stand," Roush said. "The decision is wrong, and portends nothing short of chaos and disaster for oil and gas operators in the state of Texas but conceivably in every other oil and gas producing state as well."

The Railroad Commission of Texas' Victor Carrillo doesn't share Roush's dire prediction, but does believe the effect could have a chilling effect on a hot industry - one whose record levels haven't been seen since 1985.

"Some folks say it would end exploration of the Barnett Shale," said Carrillo, commissioner of the organization that oversees all drilling statewide. "I don't go quite that far but it would certainly slow things down. We would see fewer wells drilled and ultimately a decrease in oil and gas production for the state."

Like Lowe, Carrillo said a pro-Garza ruling could put increased restrictions on hydraulic fracturing, which is the most-popular method of breaking the shale for the retrieval of natural gas.

"Without the ability to fracture those wells, the Barnett Shale trend would not be economic," Carrillo said. "You have to fracture the wells to economically drill and produce the minerals."

Waiting impatiently

Despite the oil and gas industry's malaise, Lowe said above-ground precedent could supercede its grim predictions of a lawsuit-heavy future.

"There's no reason not to be consistent and to apply the ordinary rules of trespass just like we would to you and me," Lowe said. "If the facts show there was bad dealing by a company or that there was substantial damage, then hammer them."

The other side of the coin involves the argument that "if there was property beneath you, and you aren't using it then I can go in and use it," he said.

Ultimately, the Supreme Court's decision is anything but predictable.

"As so often the law is, you have reasonable positions on both sides," Lowe said. "This is a very hard case for the Texas Supreme Court to decide."

Carrillo puts it simply.

"Yea," he said. "It's a big, big case."

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DEMAND ACCOUNTABILITY!

Chorus of operators calling for frac fluid disclosure grows

(But What Does It Mean???)
Fort Worth Business Press
By JOHN-LAURENT TRONCHE
April 26, 2010

When the nation’s largest oil and gas exploration and production company offered its support for making the chemicals used in hydraulic fracturing public, concerned U.S. residents who want transparency got perhaps their biggest boost from a somewhat unlikely source.

In a U.S. Securities and Exchange Commission filing, Irving-based ExxonMobil Corp. said it would support the disclosure of chemicals used in hydraulic fracturing. ...the injection of millions of gallons of water, sand and chemicals – so far not publicly disclosed by oilfield services companies – into the ground to break up porous shale and allow for enhanced recovery of natural gas and oil.

“ExxonMobil supports the disclosure of the identity of the ingredients being used in fracturing fluids at each site,” according to the April 13 filing. “While we understand the intellectual property concerns of service companies when it comes to disclosing the proprietary formulations in their exact amounts, we believe the concerns of community members can be alleviated by the disclosure of all ingredients used in these fluids.”

The company’s stance is seen as a move aimed at curbing possible federal regulation of fracing, which so far has been overseen by state agencies, such as the Railroad Commission of Texas. ExxonMobil’s statement also echoes similar stands by two other companies: Chesapeake Energy Corp. and Range Resources Corp., whose top executives last year offered their support for disclosure.

Although several big names support disclosure, transparency isn’t their decision to make. The oilfield services companies perform the process for the operators, and therefore must choose to make the chemicals public information, which isn’t likely.

...

The top three firms – Halliburton, Schlumberger and BJ Services Co. – either did not return multiple requests for comment by the Business Press’ time of publication or skirted the question of whether they would consider disclosing the chemicals used.

ExxonMobil can’t force services companies to disclose, said Lisa K. Vaughn, a partner in the Fort Worth office of Shannon, Gracey, Ratliff & Miller LLP, “but as they and the other bigwigs of the world put more pressure on the suppliers to disclose that might lead the,” push toward disclosure.

Operators “are beginning to feel legislative pressure against their potential environmental contaminants,” she added...

Insistence on safety

A driving force behind the move toward disclosure is public pressure.

“Part of what’s going on is this recognition by the oil and gas companies that there’s this fear by the public about what’s in the frac fluid, and this fear is caused by not knowing,” Vaughn said.

Despite public fears, the Railroad Commission of Texas insists the process is safe and effectively regulated.

Yadda yadda yadda:

“Even with the recent intense hydraulic fracing activity in the Barnett Shale of more than 13,000 gas wells, there have been no documented cases of groundwater pollution caused by fracing in Texas,” said Ramona Nye, a commission spokeswoman. “One reason for this is that the commission has strict well construction requirements that require several layers of steel casings and cement to protect groundwater. Another reason is that most of the fracing that is occurring, such as in the Barnett Shale, for example, occurs in geologically confined formations that are more than a mile deep. In contrast, the groundwater in the Barnett Shale region goes no deeper than 500 feet.

Meanwhile...

Although the Texas officials say no contamination has yet occurred, last week, about 135 Caddo Parish, La., families were evacuated after an EXCO Resources Inc. drilling crew reported “irregular pressure readings and signs of natural gas in the air” at a well site, according to KSLA-TV, a local news organization. Two wells of the three wells at the Dallas company’s site were cemented shut as a result; however, testing of private water wells also revealed at least 10 wells contaminated with natural gas, according to the Louisiana Department of Environmental Quality.

Little data available because chemicals untracked

The Railroad Commission of Texas does not require operators to list the specific chemicals used in their frac jobs; however, in the commission’s Form G-1, required for each well drilled, companies fill out how much water and sand they used, according to a commission spokeswoman. For example: 2.3 million barrels of water (which would include the chemicals) and 250,000 pounds of sand. (Each well’s drilling data is accessible to the public via the commission’s Web site.)

While the commission does not track how many wells drilled are fractured, “it is safe to assume that all of the more than 13,000 wells in the Barnett Shale have been hydraulically fractured at least once,” Nye said.

Both the state agency and the federal government are in the dark. The U.S. Occupational Safety and Health Administration requires companies to keep a list of the chemicals used at drill sites in case of accidental spills or an incident in which someone is exposed to the chemicals; however, OSHA itself does not have the information.

Oilfield services companies have resisted disclosure because they argue their formulas are proprietary.

“It’s the same concept as Coca-Cola – water, sugar and natural flavors,” said Vaughn, adding it’s that last vague component other companies want to know.

Couldn’t companies patent their recipes?

“It can be hard to get intellectual property protection for the recipes they’re using because those recipes can change day to day, week to week (and) site to site due to all these different variables,” she said.

Although companies claim their specific formulas are trade secrets, operators have sought to dispel concerns by shedding some light on the process; for example, Chesapeake Energy created a Web site, hydraulicfracturing.com, that reveals some of the chemicals – though not the amounts in which they’re used.

“What is not fully disclosed are the specific quantities of each chemical used in the blending of frac mixtures on location. That varies, well-by-well, and is proprietary to the service providers,” according to a company spokesman. “We have encouraged the providers to be more transparent with this information but we respect that they are in a highly competitive industry and have trade secrets to protect.”

And this is, of course, more important than public health and safety or protecting our most vital, irreplacable resource (water), among other environmental concerns.

Possible federal regulation

Last summer, four legislators from Colorado, New York and Pennsylvania introduced a bill aimed at giving the federal government oversight into hydraulic fracturing, arguing a process being used in more than half of the United States requires even-handed regulation across the board. Industry groups counter the bill would result in thousands of lost jobs and billions in unrealized revenue.

The FRAC Act, or Fracturing Responsibility and Awareness of Chemicals Act, would amend the Safe Drinking Water Act of 1974 to require oil and gas companies to disclose the chemicals they use in their hydraulic fracturing processes.

If companies opt to disclose, it’s likely it would be an all or none approach, because if just one company offered its formula it would put itself “at a business disadvantage,” Thompson said. “If there’s governmental regulation, then they’re all going to have to disclose.”

ExxonMobil has an interest in thwarting federal oversight; a stipulation in its proposed about $30 billion acquisition of Fort Worth’s XTO Energy Inc. says the former can walk away from the deal if Congress passes federal regulation.

Not all operators support disclosure

While some companies have offered their support for disclosure, EOG Resources Inc. will not. A March 25 proxy statement includes a proposal, expected to be put forth April 28 at the company’s annual meeting by a group of stockholders owning about 245,000 shares, that calls for a study into using “less toxic fracturing fluids, recycling or reuse of waste fluids and other structural or procedural strategies to reduce fracturing hazards.”

EOG Resources’ Board of Directors opposes the proposal, calling the process “a well-established reservoir stimulation technique” that poses “minimal impact to the environment and to human health.” The board recommends shareholders vote against the proposal. (An EOG Resources spokeswoman said the company would not provide further comment.)

A virtually identical proposal in ExxonMobil’s proxy statement, submitted by San Francisco’s The Park Foundation, also will receive a no vote by the company’s board of directors; however, as previously noted, ExxonMobil does support disclosure. (It's an easy public relations ploy... looks good, costs nothing.)

Editorial comments by Splashdown in red.

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DEMAND ACCOUNTABILITY!

What the Frack? Natural Gas from Subterranean Shale Promises U.S. Energy Independence--With Environmental Costs

Natural gas cracked out of shale deposits may mean the U.S. has a stable supply for a century--but at what cost to the environment and human health?

By David Biello
ScientificAmerican.com
March 30, 2010

DISH, Tex.—A satellite broadcasting company bought the rights to rename this town a few years ago in exchange for a decade of free television, but it is another industry that dominates the 200 or so residents: natural gas. Five facilities perched on the north Texas town's outskirts compress the gas newly flowing to the surface from the cracked Barnett Shale more than two kilometers beneath the surface, collectively contributing a brew of toxic chemicals to the air.

It is because of places like DISH (formerly known as Clark) and similar sites from Colorado to Wyoming, that the U.S. Environmental Protection Agency (EPA) has launched a new review of the practice known as hydraulic fracturing, or "fracking". From compressor stations emitting known human carcinogens such as benzene to the poor lining of wells after drilling that has led some water taps to literally spout flames, the full set of activities needed to produce natural gas gives rise to a panoply of potential problems. The EPA study may examine everything from site selection to the ultimate disposal of the fluids used in fracking.

View a slide show of hydraulic fracturing

The picture from DISH is not pretty. A set of seven samples collected throughout the town analyzed for a variety of air pollutants last August found that benzene was present at levels as much as 55 times higher than allowed by the Texas Commission on Environmental Quality (TCEQ). Similarly, xylene and carbon disulfide (neurotoxicants), along with naphthalene (a blood poison) and pyridines (potential carcinogens) all exceeded legal limits, as much as 384 times levels deemed safe. "They're trying to get the pipelines in the ground so fast that they're not doing them properly," says Calvin Tillman, DISH's mayor. "Then you've got nobody looking, so nobody knows if it's going in the ground properly…. You just have an opportunity for disaster here."

DISH sits at the heart of a pipeline network now tuned to exploit a gas drilling boom in the Fort Worth region. The Barnett Shale, a geologic formation more than two kilometers deep and more than 13,000 square kilometers in extent, holds as much as 735 billion cubic meters of natural gas—and the city of Fort Worth alone boasts hundreds of wells, according to Ed Ireland, executive director of the Barnett Shale Energy Education Council, an industry group. "It's urban drilling, so you literally have drilling rigs that are located next door to subdivisions or shopping malls."

Although the first well was drilled in 1982, it took until 2002 for the boom to really get started. Now there are more than 14,000 wells in the Barnett Shale, thanks to a combination of being able to drill horizontally and fracking—pumping water at high pressure deep beneath the ground to literally crack the rock and release natural gas.

"They pump a mixture of water and sand—and half a percent of that is some chemicals, like lubricants," Ireland explains. "They pump that into the formation at a very high pressure. Cracks it just like a windshield. And the cracks go out a couple hundred feet on either side and that forms the pathway for the natural gas to migrate to the well bore and up to the surface."

All that natural gas may prove a boon to a U.S. bid for energy independence. Plus, burning natural gas to produce electricity releases roughly 40 percent less of the greenhouse gas carbon dioxide than burning coal. So the question is: Can extracting that natural gas be done safely?

Water pollution
As Ireland notes: "There's never been a documented case of contaminated water supply." That is technically true, but residents of Dimock, Pa., may disagree. That town sits atop the Marcellus Shale—a giant natural gas–laden rock formation that stretches from Tennessee to New York State—and the kind of extraction now going on in Texas is just getting started there. In Dimock, leaks from badly cased wells contaminated drinking water wells—and one even exploded.

It all comes down to the fact that fracking involves a lot of water. There's the at least 11.5 million liters involved in fracking a well in the first place. There's the brine and other fluids that can come to the surface with the natural gas. And there's the problem of what to do with all that waste fluid at the end of the day.

In Dimock's case, Houston-based Cabot Oil and Gas has spilled fracturing fluid, diesel and other fluids, according to Pennsylvania's Department of Environmental Protection. And elsewhere in the state fracturing fluid contamination has been detected in the Monongahela River, which is a source of drinking water. In more common practice, companies dump used fracking fluid back beneath the surface, usually injecting it into other formations beneath the shale. For example, in the case of the Barnett Shale, disposal wells send that water into the deeper Ellenburger Formation.

But there's also the problem of what's actually in the fracking fluid. EPA tests in Wyoming have found suspected fracking fluid chemicals in drinking water wells, and a study by the New York State Department of Environmental Conservation identified 260 chemicals used in the process—a review undertaken as the state decides whether to allow such drilling on lands comprising the watershed providing New York City with its drinking water. And Dow Chemical notes that it sells biocides—antimicrobial poisons—to be included in the mix. But companies zealously guard the secret of what exactly makes up their individual "special sauce." It is one of the ways the companies distinguish themselves.
(See Flower Mound Citizens Against Urban Drilling March 30th post: Natural Gas Drilling Companies Searching for Hydraulic Fracturing Alternatives)

Air pollution
In places where required by law, natural gas companies also distinguish themselves by how they filter out air pollutants. "There's [vapor recovery units] that they can put in place to cut out 95 percent of the emissions from a site," Tillman says. "In states where it's been mandated they do it, and they do it willingly—and they do presentations that show how they're going to comply and how their vapor recovery unit is better than the next guy's vapor recovery unit."

That obviously does not happen in DISH, and a big part of such negligence is a lack of appropriate oversight. For example, after it received complaints the TCEQ sent an SUV with a gas detection unit to drive around Dish for a couple of hours. Despite widespread complaints of odor, the commission found "no leaks that would be detectable to the human nose," Tillman says. "So obviously they're trying to deceive us, they're treating us like we're blooming idiots."

As a result, DISH conducted its own air quality test—at a cost of 15 percent of the town's annual budget of $70,000—that revealed the toxic mix of air pollution. Subsequently, the town petitioned and won the right to install one of seven permanent air monitors in the entire state of Texas. "It's not just writing regulations," Tillman notes. "Somebody has to go out and make sure they're following regulations. And when they're not following regulations, the punishments need to be swift and harsh."

That problem is not confined to the TCEQ or the Railroad Commission of Texas, which through a quirk of history regulates the Lone Star State's oil and gas industries. National laws, like the Safe Drinking Water Act, have been specifically amended to exempt hydraulic fracturing from federal regulation. Yet a New York City analysis of fracking has found that whereas a single fractured natural gas well may do no harm, the hundreds required to exploit shale gas "brings an increased level of risk to the water supply." Plus, although fracking occurs deep below freshwater aquifers, natural cracks "serve as conduits that facilitate migration of contaminants, methane or pressurized fluids."

And it's in the air, too. The Texas Health and Human Services Commission is now conducting tests on roughly 30 residents of DISH to see what might be the human health impacts of this air pollution exposure. And the TCEQ has found high air pollution levels in other nearby towns, such as Decatur, and at individual residences.

Climate savior?
Nevertheless, a 2004 study by the EPA found hydraulic fracturing harmless and the oil industry has been using a roughly similar extraction method since the 1940s. If shale gas can be extracted safely, it might go a long way to cutting back on U.S. emissions of greenhouse gases, as acknowledged at the U.N. Copenhagen climate conference this past December by environmentalists such as Christopher Flavin of the Washington, D.C.–based World Resources Institute. "Compared with coal, natural gas allows a 50 to 70 percent reduction in greenhouse gas emissions," he said. "It's a good complement to the wind and solar generators that will be the backbones of a low-carbon electricity system."

Already, the U.S. produces nearly 600 billion cubic meters of natural gas annually, according to the U.S. Department of Energy (DoE), and it estimates proved reserves of natural gas of at least 6.7 trillion cubic meters. The Marcellus Shale alone may have at least 10 trillion cubic meters.

A host of companies have moved in to exploit this resource, and a "few hundred" wildcatters operate in the Barnett Shale alone, according to Ireland. "The wildcatters are the small companies, they have a low overhead, and they can afford to go out and take some risks," he says. "That's been the history of the business and I think that will continue." But major companies have also taken an interest; ExxonMobil hopes to buy natural gas producer XTO Energy pending regulatory approval.

That's because natural gas is becoming more and more the fuel of choice for generating electricity; the DoE expects 21 percent of U.S. electricity to be derived from natural gas by 2035, and by 2034 power plant builder and consulting firm Black & Veatch expects almost half of all U.S. electricity to come from burning natural gas. "I don't see gas shales having an insurmountable environmental problem that is expensive to fix," says Mark Griffith, head of Black & Veatch's power market analysis.

And the gaseous fossil fuel is used for everything from home heating to making plastics and fertilizer. "It's good that we've discovered all this natural gas, because we're going to need it to generate electricity," Ireland says. "Twenty years from now, we're still going to need all the natural gas we can get."

Some, such as Texas oil- and gas-millionaire T. Boone Pickens, have even suggested using this new surfeit of natural gas to help wean the U.S. off foreign oil, turning it into vehicle fuel. Of course, compressed natural gas is already the fuel of choice for many metropolitan area bus fleets.

Ultimately, however, shale gas extraction—and the hydraulic fracturing that goes with it—will have to be done right. "If something comes out that you're poisoning the population, it's going to be a very bad thing," Ireland notes.

The EPA anticipates finishing its latest study of the practice by 2012. "Six months ago, nobody knew that facilities like this would be spewing benzene," Tillman notes. "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.'"

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Editor's Note: David Biello is the host of a forthcoming series on PBS, tentatively titled "The Future of Electricity". The series will explore the coming transformation of how we use and produce electricity, along with its impact on the environment, national security and the economy. He conducted the interviews for this article in conjunction with his work on that series.

DEMAND ACCOUNTABILITY!

Chesapeake says NY could drive away gas drillers

Accuses environmentalists of promoting "fear and panic"

By Edith Honan
(Reporting by Edith Honan; Writing by Daniel Trotta; Editing by Cynthia Osterman)

NEW YORK, Jan 5 (Reuters) - Chesapeake Energy (CHK.N) has called proposed New York state regulations for the shale gas drilling industry unnecessarily onerous and likely to scare energy companies out of state, depriving New York of badly needed revenue.

The sentiment was supported by competitor Fortuna Energy, a subsidiary of Canada's Talisman Energy (TLM.TO), which said it was shifting its focus to Pennsylvania because uncertainties in New York threatened to undermine its investments there.

"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.

As a result, "some operators may elect to focus their risk capital in other states," the company said, which would mean New York would lose potential tax revenue from gas production at a time when the state is looking to close a $3.2 billion budget deficit.

The Oklahoma-based energy company, which on Monday announced a deal to sell a $2.25 billion stake in its Texas shale gas assets to French oil major Total (TOTF.PA), accused the state Department of Environmental Conservation (DEC) regulators of going overboard with environmental protections.

Fortuna said companies faced uncertainty over whether the state would issue drilling permits and it was looking toward Pennsylvania, where exploration of the Marcellus Shale is booming -- but it is also where some of the greatest environmental concerns have arisen.

"New York is facing the loss of at least hundreds of millions of dollars of direct economic impact stimulus and is forfeiting the opportunity to create thousands of new jobs at a time in our state's history when they have never been needed more," Fortuna lawyer Mark Scheuerman told the DEC.

Development of the massive Marcellus Shale in several northeastern states holds the promise of providing the United States with a valuable domestic energy source. But environmental concerns that shale gas drilling contaminates drinking water have created uncertainty for the industry because of the risk of greater regulation.

The U.S. Environmental Protection Agency is scrutinizing shale gas drilling, and the U.S. Congress is considering a bill that would force companies to disclose the chemicals that are mixed with water and sand in the process known as hydraulic fracturing.

New York Governor David Paterson proposed opening the Marcellus Shale to the technique. It has been taking place in New York but on a small scale and using relatively minor volumes of water compared to the current industry norm.

...

Until now, shale gas drillers in the state have been limited to less modern techniques that yield less energy.

HEALTH CONCERNS

Environmentalists have raised serious health concerns about the chemicals used in hydro-fracturing, including that they might cause cancer.

Neighbors of shale drilling operations in other states have complained their drinking water has become discolored or foul-smelling, their pets and farm animals have died from drinking it, and their children have suffered from diarrhea and vomiting.

Chesapeake accused critics of creating "fear and panic" with misleading or incorrect information and concerns "that have no basis in science or reality."

Chesapeake's views on the industry took on greater weight in light of its deal bringing Total into Chesapeake's Barnett Shale gas fields in north Texas.

That continued a trend in the industry of international oil majors buying shale gas assets. In December, the largest U.S. oil and gas company, Exxon Mobil (XOM.N), agreed to buy shale gas producer XTO Energy Inc (XTO.N) for about $30 billion.

LINK.

DEMAND ACCOUNTABILITY!

The rush is on

Bradford County leads state in Marcellus Shale drilling permits in 2009
by Steve Reilly, Staff Writer
Morning Times
Saturday, January 2, 2010

The natural gas rig looming over a hundred feet over the Eileen property in Smithfield Township is one of 92 drilled in Bradford County in 2009 — over six times the number drilled in 2008.

Like many Bradford County rigs, the massive structure has become somewhat of a roadside attraction for curious passers-by.

But if current trends continue, it could be only a matter of time before such rigs jutting out from the rural landscape become less a novelty and more a part of the county’s everyday scenery.

If Pennsylvania was the primary target for gas exploration in the Marcellus Shale in 2009, Bradford County was its bulls-eye.

At the end of 2008, there were a total of 63 permits to drill wells into the Marcellus Shale in Bradford County, 17 of which had actually been drilled.

In 2009, according to statistics released on Nov. 30, there were a total of 383 Marcellus Shale drilling permits granted in Bradford County — more than any in other county in Pennsylvania.

With over 300 permitted wells yet to be drilled in the county, and with the torrid pace at which permits are granted showing no signs of stopping, all indications point to 2010 as a year in which the natural gas industry could forever transform the landscape of Bradford County.

The rush to drill in 2009

Until 2008, few had heard of the Marcellus Shale, a rock formation buried 5,000 feet deep stretching across 95,000 acres of a four-state region from New York to West Virginia. But two events in the last decade combined to unleash the hidden potential of the shale bed and make “the Marcellus” a household name.

In 2005, natural gas companies began exploiting the Barnett Shale in the Fort Worth, Texas area using a combination of hydraulic fracturing, or “hydrofracking,” and newly-pioneered horizontal drilling techniques to extract natural gas from the shale. The tremendously profitable gas extraction operations in Texas led to a hunt for similar formations across the country, and eventually to the establishment of relatively smaller natural gas economies in Arkansas’ Fayetteville Shale and Louisiana’s Haynesville Shale.

Then, in January 2008, Penn State geosciences professor Terry Engelder and SUNY-Fredonia geology professor Gary Lash released a study that estimated the size of the Marcellus Shale at 168 trillion to 516 trillion cubic feet — 80 to 250 times the previous U.S. Geological Survey estimate. In terms of geographic area, the Marcellus Shale is estimated to be 19 times larger than the Barnett Shale.

Both of these factors — the development of new drilling technology and new geological insights into the size of the Marcellus Shale — combined to set the stage for an exploratory phase that saw a cadre of multinational gas companies to flock to the area in 2008. That year, the Pennsylvania Department of Environmental Protection (DEP) granted permits to various gas companies to drill in the Marcellus Shale at 476 sites across the state, the majority in later half of 2008.

But in 2009, activity took off in earnest. DEP granted 1,742 Marcellus Shale drilling permits state-wide as of Nov. 30, with promises of even more in the pipeline for 2010.

DEP press secretary Teresa Candori stated that although there will continue to be many permits in 2010, she doesn’t necessarily expect the number of permits the agency grants to triple again next year.

...

Candori stated that DEP recently hired 37 new staff members specifically to handle the growing Marcellus Shale workload at the agency. Their salaries, she said, will be drawn directly from a recent hike in permitting fees.

Economic impact

...

“It’s pretty amazing, statewide,” said Mark Scheuerman, chief general counsel and media relations manager for Fortuna Energy. “I think the numbers that the Marcellus Shale Coalition, through their economic development analysis they did through Penn State, account for about 26,000 new jobs in Pennsylvania since about a year ago, all attributed to Marcellus development, (and) we think that will continue.”

“(In) areas like the Barnett Shale in Texas, in the Fort Worth area, in about three to five years there were almost 100,000 new full-time jobs associated with Barnett Shale exploration and the production. That’s a formation that is about 5,000 square miles. The Marcellus — and, of course, it covers a four-state area — is about 95,000 square miles. And Pennsylvania has the biggest chunk of it. So if you can extrapolate from those numbers, it gives you kind of breathtaking forecast of what the economic impact will be from a jobs standpoint,” Scheuerman added.

...

Brian Driscoll, countywide economic development manager of the Central Bradford Progress Authority stated that the economic impact has been noticeable, but difficult to quantify “just because it’s so tough to track that with so many different companies involved, and there are subcontractors involved, and all different dynamics.”

“It’s no secret to anybody there’s a lot of activity more going on,” he said. “There are some employment impacts. A lot of the employment seems to be going to folks from outside of the area. But that has created a tremendous demand for hotel space as well as residential rental units, like apartment-type dwellings. So there’s been a real increase in demand for housing, both temporary and longer-term.”

“You (also) see a lot of activity at restaurants and service-related activity,” Driscoll added. “So I think the spectrum’s pretty wide-ranging.”

But, according to Driscoll, the idea of gas industry profits falling into county resident’s hands hasn’t quite come to fruition yet.

“What we don’t see at this point is a lot of revenue coming directly into residents’ hands through royalty payments or anything like that, because the process isn’t quite far enough along. A lot of folks have gotten lease payments, but aren’t in the royalty cycle yet,” he explained.

Driscoll also pointed to the secondary aspects economy that are indirectly benefiting from the increase in population and the growing numbers of transient workers.

“I know that there are existing businesses in the Valley and elsewhere in the county that you might not think would be totally related (that are benefiting). I know hardware stores have been selling components to these folks. We know of a company that sells cleaning supplies that has been inundated with requests for their materials, just based on additional people in residential units. Flower shops (are benefiting because) guys from Texas are sending flowers back home to their wives. Stuff like that that you just wouldn’t think of has become impacted as well,” Driscoll said.

However, the expected increase in population will probably cause some speed bumps that must be dealt with along the way, according to Bradford County Commissioner Mark Smith.

“The increase in the population and the increase in human services is going to have an impact. Our correctional facility and services such as children and youth, and drug and alcohol services, and the school systems — the issues and problems that arise naturally from having more people in the county will have to be dealt with as the changes develop," Smith stated.

Another issue prominent in the minds of local officials is the prospect of a state-mandated severance tax on oil and gas revenue in Pennsylvania that would send portions of the gas companies back to the state’s general fund.

Many local officials, such as Bradford County Commissioner Doug McLinko and state Rep. Tina Pickett, have been vocal in their opposition to the proposed severance tax on the grounds that it would take tax revenue away from municipalities where most of the drilling is occurring and send it back to the state government.

Pickett stated that a better way to raise revenue from Marcellus Shale activity would be to lease selected portions of state property to gas companies.

Splashdown: Maybe she'll explain that...

Proponents of the tax argue that 14 of the other top 15 gas-producing states in the country have such a tax.

Natural gas and the Valley: ‘A very busy year’

As the natural gas industry takes its foothold across the county, it seems to have skipped over the Valley in terms of permits granted and rigs constructed. But the central location and developed nature of the Valley have made it a prime target of gas companies during the past year in their search for a place to locating their infrastructure.

Tunkhannock-based Somerset Regional Water Solutions’ proposed water treatment facility on Mile Line Road, voted down by the Athens Township Board of Supervisors in November due to it’s failure to correct a number of deficiencies in the original plans, was one example of a failed venture this year. Documents attached to the proposal for the treatment plant indicated that incoming wastewater would potentially be radioactive, and that excess water would be dumped into the Chemung River.

Two successes for the gas industry, however, were achieved in the Tannery Curve area of Athens Township. There, a 50-truck parking lot and a water withdrawal site were approved and are now currently being developed to feed Chesapeake Energy’s drilling operations throughout the county, taking advantage of the site’s proximity to Route 220.

Two other projects — a 60-person temporary housing quarters, or “man camp” on Round Top Road, and an East Athens water withdrawal facility — were nixed by gas companies themselves in the middle of the approval process. Reports indicate that another site for the “man camp” is being sought by Nomac, Chesapeake Energy’s drilling subsidiary.

...

Looking ahead: ‘It depends on the rocks’

Although forecasts indicate that 2010 will be a pivotal year, and many in the area are counting on the quick growth of the fledgling industry, the pace at which the industry develops is dependent on one thing that is out of anyone’s control: nature itself.

...

“From our perspective, about a year ago we had zero production in the Marcellus. Now we’re at about 30 wells and we’re producing just at about 70 million (cubic feet) out of our Marcellus wells in Northern Pennsylvania. It’s been quite a satisfying accomplishment and we’re looking to expand on that in 2010,” [Fortuna's] Scheuerman said.

“But there’s always a lot of factors that go into exactly where you conduct operations — whether it’s exploration or development — and then production is always a question of mother nature,” he added.

“It depends on the rocks, as they say.”

For complete article, CLICK HERE.

DEMAND ACCOUNTABILITY!

Barnett Shale... Marcellus Shale...

Here's a post that'll give your mouse some exercise, starting with the MUST READ post by TXsharon over on Bluedaze, Barnett Shale Money Creates a Public Deaf, Dumb and Blind to Risks which links to the MUST READ article in the Fort Worth Weekly, by Don Young, Learning to Love Big Gas.

When you read these stories, and you contrast the bait with the hook, line and sinker, you have to sit up straight and pour yourself a V-8!
It occured to me, and I hope it'll to occur to more and more folks everywhere:

This is an important post, and it links to an important article because it reveals exactly how the gas industry is eroding democracy in the guise of benevolence, while really they're buying guarantees to their own corrupt brand of outlaw freedom!

What makes this information so vital is that this is not just happening in Fort Worth or in Texas. It's being repeated here in Bradford County, PA on the Marcellus shale (and no doubt in lots of other places as well). The 'benefactors' seem quite pleased (while apparently, like TXsharon says, "Deaf, Dumb and Blind to Risks"), but what they're giving away is everyone's America... or what's left of it once the drillers buy it out from under us.

For an actual example of what's being exposed here, don't miss TXsharon's next post, in which she shows us pictures of the Chesapeake display in the library. Notice especially the picture of the "Frack Pond" ... See how blue (clean) they've portrayed the water as being?
Now who doesn't know that's a lie???

DEMAND ACCOUNTABILITY!

Is the Juice Worth the Squeeze?

The Latest Report from Calvin Tillman, Mayor of DISH, TX

When taking over as mayor of DISH, the first question that was asked by the local media outlets was to respond to the fact that our property values as a whole had decreased considerably from the past year. This is where small towns and cities get the bulk of their funding, through taxes on these property values. Therefore, if the taxable value goes down, naturally the revenue for the town does as well. Now I must say that I am opposed to unnecessary taxation, and therefore have done everything I can to make the taxes here the lowest in the area, and succeeded. However, the town has doubled in size over the last couple of years, yet the taxable value continued to drop. This baffled me how essentially the total value of the town drops every year, while were experiencing massive growth.

Not only did it baffle me, but it concerned me. As most small towns do, we use the county tax assessor’s office to perform the tax collection service for us, so they were my first call. When they explained the mineral values were the cause of this drop, and that was sixty percent of our tax base, I was again stunned. As you know we are located in the middle of the Barnett Shale, and have had a great deal of exploration in this area. So what would cause the values to continue to drop? This was also during the timeframe when natural gas prices were climbing to all time record highs.

As I investigated the source of the decline in my town it all started to become apparent. The property values not tied to minerals have continued to drop. I believe this is mostly due to the massive natural gas compressors, pipelines and metering stations. They have all but made the surface property here worthless; however, that does not account for the minerals which is over half of our taxable values. I then found that on average, each well drilled loses fifty percent of its production after the first year. That is a huge drop in production in only one year. So that tells me that the only way to maintain the same mineral value is to drill fifty percent more wells every year. So if you have ten wells this year, you would need to drill five more next year just to maintain the same production.

Many of the local cities have went on a sort of spending spree with the new found wealth from the natural gas minerals, and are now finding themselves in a financial crunch. The facts that I taught myself through this simple question from an intui tive reporter has made a world of difference on how I approached this problem here in DISH. We are frugal at best here, making the most of every dollar we get. We have cut the town debt in half, built a massive park, a library, repaved roads and performed substantial upgrades to town facilities and done this while lowering taxes and not dipping into the emergency fund we have in only two years.

To the real point, is what do minerals play into all of this? As previously mentioned we have over half of our tax dollars that come from the minerals, more specifically the revenue we received in 2007 was made up of 56% mineral values, in 2008 that number jumped to 64%. We have not gotten the completed numbers for 2009, but they will likely be similar. The dollar figures for this are 14,500,000 in 2007 and 22,277,000 in 2008 in property values from mineral.
On the surface the benefit from this industry seems huge. We are a small town and they double our value. But I also compare this to the drug “heroin”, due to seeing the other towns which have gotten addicted to the drug and when the drug goes away, (when they price of natural gas goes down 75% as it has), they find themselves in a financial crisis. Also, most people do not take into account how much it costs to have this activity going on. I can only explain what goes on in DISH, TX, but will attempt to explain the drug's side effects.
First and foremost this exploration destroys roads, which are very expensive to maintain and replace. None of the existing roads were designed to withstand the constant pounding from an 80,000 pound waste-water truck. Nor were they designed to handle the larger equipment that is used to drill and refracture the wells. To build roads to handle this traffic can cost millions of dollars.
If the municipality owns the roads, they can force the companies to sign a road use agreement, which forces them to pitch in and help the roads. Most of the cities in the area have agreements like this in place. If they do not, then they are foolish, and are likely costing their taxpayers a great deal of money by not forcing the companies to pay. However, the drilling companies are going to take whatever measures they can to keep from paying damages to the roads. The City of Argyle found out the hard way when they were sued by XTO over road work.
Here in DISH many of the roads are not owned by the town. This is both good and bad; it is good because we don’t have to pay for the major upkeep of these roads. However, if we don’t own the road we don’t have much control either. For example, we have implemented a weight restriction on all of the roads that we do own, but we can not enforce this on roads that we do not own. Unfortunately, the county does not have the capability to force these companies to have road agreements and pay for what they destroy. Therefore, the replacement and repairs come from the general taxation, or bond elections, not directly from the gas companies. So as you might guess it is a juggling match for the counties to keep the roads drivable for the average vehicle.
One example of that is Eakin Cemetery Road, which goes through part of DISH, but is owned by the county. A pipeline was being installed in this area, and the equipment used in this process is massive. Please note that the pipelines must be included in the cost of this exploration, even though they contribute little to the towns or property owners, and take a lot in return. I will discuss how bad they hurt the towns later.
When this line went in the companies used Eakin Cemetery Road to access the route. They completely destroyed this road and virtually made in impassible for the average vehicle. You could literally see the grooves where the truck tires that hauled massive equipment went. The pavement was cracked and torn from this equipment and the pipeline companies did nothing to prevent or repair this. And though the county does work hard to keep the roads in reasonable shape, when something like this happens in takes a while to plan the repair; therefore, the citizens here were forced to drive on the impassible road for quite a while until repairs were made.
There is another impact that can be recognized quickly, and that is the affect that the exploration has directly on surface values. I am sure that there are some who believe the propaganda and are fine with having a well or pipeline in their front yard. However, regardless of what you may have heard, they are the exception not rule, especially if you have a small population of mineral owners in your community. The average person will not purchase the property right next to a well site or compressor, providing they are made aware of it. Unfortunately, most of the mineral owners in this area have kept the minerals and moved on to someplace else. However, when they have tried to sell their property with wells and pipelines on them, it has not been successful.
Although you may see a boost in your tax rolls for the short term, you will pay in the long run with the drop in property values. For a small growing community like DISH it especially provides an obstacle for quality growth. There have been four large tracts of property for sale in DISH for several years with no real interest in purchasing the property. If you do manage to get some interest in the property, it will likely be something like a pipeyard or something else that continues to devalue the surrounding property. So getting quality growth in an area that has a large amount of exploration proves to be a large hurdle if not impossible.
The above paragraph dealt with the exploration of the mineral, now we must consider the pipelines, and appurtenances to these pipelines, such as compressors or metering stations. These facilities have dealt us a very harsh blow without giving much in return. This is highlighted by a previous illustration of the pipeyard. The gentleman who unfortunately lives next door to this compressor site sold off a piece of property to a developer who built 18 homes that average around $200,000 each. However, after the compressors were there, he has not been able to give his property away. He was only able to lease some of it to a company that stores pipe. That is the best he can do now, and that in itself is very low quality growth and makes the area even less desirable.
Another illustration that has been used by me before is the gentleman who has had 63 acres for sale now for several years. He purchased the property as an investment, and now has three pipelines and an above ground valve. He can not give this property away. As he reaches retirement age his retirement has been stolen from him. This is no different than Enron or any other scandal, only it has been made legal thievery. There are two other pieces of property that have been for sale for several years, one of which is a large parcel of about 70 acres and the other is about 10 acres.
The above examples are heart wrenching when you look at how much it has cost the property owners, and only one of the above mentioned owners has any substantial mineral interest. Therefore, they others are merely victims of circumstance. However, as this gets to the point of whether this all is really worth it, I believe that if all of these property were sold and developed it would add somewhere around $20,000,000 in property values, which is more than the average in mineral values over the last few years. I also believe this is a very conservative estimation, it could be more.
So would you rather have homes than minerals? Homes in theory will increase in value over the long term while minerals will drop. Although, this has not been case the last couple of years, in the long term this has held true. Also, natural gas is a commodity, and its prices are much more volatile than housing. For example in the last couple of years the lowest price of natural gas is about 25% of the highest; therefore, you have seen a 75% drop in prices in a little over a year.
In DISH we have focused on overcoming the boom and trying to get quality development. We have worked with a number of developers to annex their property into the city. All three of the major annexations we have had since I became mayor, have been solely to protect them from the development of the minerals and total destruction of the surface values that accompany it. This is not saying that we do not allow drilling; we just force the companies to do it responsibly. We have a pad site that is right in the middle of one of these subdivisions and it really does not look that bad. It is lined with an eight foot concrete fence and most of the stuff inside including the tanks is not visible beyond the fence. However, the companies will only do this when they are forced too, they will not volunteer it.
So how about all those mineral owners who have gotten filthy rich? Here in DISH there have been some folks who have made a great deal of money on the minerals. However, most of them had lived here their whole life, and had property handed down over the generations, otherwise they only have a small portion of the mineral rights. Therefore, there are only a few that are still alive that have a major portion of the mineral rights, and as previously stated most of them have moved away to someplace that they do not have to deal with the mess that is left behind.
This area was the beginning of the Barnett Shale, if I am not mistaken the first gas producing well in the Barnett Shale, was within 20 miles of DISH. Therefore, the minerals were purchased several years ago, and the leases were quite low in comparison to the massive leases signed last summer. The lease here is somewhere around 16% royalties with anywhere from $1,000 to $1,500 per acre, not the 25% and $25,000 per acre that have been publicized.
So what does the 16% royalty get you? From what I understand, for someone who owns four acres and has a quarter of the mineral rights, they average less than a $100 a month. Therefore, if you have one acre with 100% of the minerals you would get something similar. Therefore, unless you have a massive amount of land with 100% of the minerals, you are not going to get much money. If you are part of the lease, you must also consider the truck traffic, odor, noise, and you just might be fortunate enough to have a high pressure gas pipeline run through your front yard. All of these things accompany the hundred bucks a month. I do not have any mineral rights, if anyone has another illustration please add it to this posting.
So to the point of, is the juice worth the squeeze? From my perspective as a small town mayor and a property owner, I say no! Not in the manner in which it is being done in Texas. I think that with minor regulation it could both provide the natural resources that we need as well as not totally destroying the surface values and destroying the growth of these areas. For example, there is no process in Texas for the laying or routing of pipelines. The pipeline companies can literally put them anywhere they want without concern for surface owners and other natural resources. Municipalities do have some limited control over the placement of the wells, but not the pipelines.
The items that were discussed were only the things that are easily recognized. I am still learning the affects on air and water quality and to explore the possible health of affects of this exploration. Although I have recently learned that the companies with the compressor site have learned a loophole that allows them to virtually go without regulation in regards to the air emissions they produce. I will share more on this subject as I figure out the specifics. I have the documents; I just have not digested everything yet.
This also does not include the tens of thousands of dollars in legal fees it takes to offer the citizens some minor protection from these companies. Nor does it take into account the hundreds of hours of my time spent researching and campaigning for more regulation for no pay. So you must ask yourself; is the juice is worth the squeeze? I can support any statement that was made in this posting; therefore, if you have more specific questions, please let me know and I will clarify it for you. To those of you who have visited DISH, I doubt you have any questions in regards to the impact the Barnett Shale has had on us.


Calvin Tillman
Mayor, DISH, TX
(940) 453-3640

"Those who say it can not be done, should get out of the way of those that are doing it"

DEMAND ACCOUNTABILITY!

Next Up... Marcellus Shale Earthquakes?

Before drugs are made available for prescription they must go through a period of testing... of trials by volunteers willing, not just to reap the potential benefits, but also to risk the side effects.

The FDA is that govt. agency charged with testing to determine the viability of the drug vs. the consequences. It is their job to administer a regulatory and compliance process to insure public safety by evaluating effects, defining causes and understanding events in order to develop a scientifically sound basis for decisions that reduce risks associated with FDA-regulated products.

Protecting the population in this way then, is an acknowledged need. We understand and expect it is working for us at all times. We rely on it to be vigilant and monitor its jurisdictions in an ongoing way.

We need the same kind of regulation and protection from harm for the environment... OUR environment, which we take so readily for granted that we do not tend to understand how integral it is to our every day survival. We NEED breathable air. We NEED drinkable water. We NEED life sustaining land. All life needs these things. All life is interdependent.

At present, the air, water and land, as well as the life it sustains... WE ...are all guinea pigs of the oil and gas industries' unregulated procedures of extracting fossil fuels from the earth.

"High Volume Horizontal Slickwater Hydraulic Fracturing" ("hydro-fracking") is essentially an untested technology. It involves approximately three million gallons of water per "frack". Blended with this are about 10,000 gallons of toxic chemicals, sand-blasted deep beneath the ground under very high pressure for each frack. Fracking may occur up to 12 times over the life of a well (up to 40 years). That water must be trucked there in 10,000 gallon tanker trucks. At three million gallons water/frack, that's 300 incoming truckloads. 12 fracks brings the total to 3,600 incoming truckloads. If the industry achieves its goal of 100,000 Marcellus shale wells, that equals 360,000,000 truck trips from somewhere to a well site. That water must also be trucked away to an as yet unknown place when it has become irremdiable toxic waste.
(Thanks to Infoshop News, June 10, 2009 for portions of the above paragraph.)

Drillers have developed a method that works to release the gas trapped deep in the earth, in the tight gas shale layer, however, they have not sufficiently studied the consequences of this method of extraction, nor have they concerned themselves with the effects the consequences have on ... well, just about anything other than profits. The evidence is everywhere the drillers are, and the evidence is mounting daily.
Unlike the drug industry, and to our supreme disadvantage, our state and federal regulatory agencies appear to be either disempowered or cooperating with industry. Regulations have been rescinded in the name of this policy, while water is becoming forever fouled... rendered unrecoverable.
Toxic wastewater is being sunk deep into the ground in hopes that will solve the problem these wastes present. But what are hopes? Hopes are what you have for the future when you don't have present solutions.

At present, there is more that we don't know about the effects of hydro-fracking than what we do know, which is that gas will come up the hole.
We don't know enough for example about the migration of the fracking fluids and the gas itself underground, or the differing behavior of these within the various shale formations. Nor can we predict the pressure behind the flowback or who will die in the accidents... whether it be this nurse, that driller, or that herd of pregnant cattle or these little crayfish, or that man's calf, or the pronghorn, elk and mule deer herds, or that farmer's hogs, or stillborn livestock in many locations where drilling is going on, along with reproductive changes in horses, cows and goats. And who knows about the wild creatures we can't monitor, or the accumulating adverse effects on our own health?

Most folks who signed on to drilling were not given a clear picture of the road ahead. Now that they are learning more, they're learning too that there is little they can do. As they look for the same kind of protection from our government agencies as the FDA provides, for example, they are not finding the level of protection they want and need and that should be there.

And now, yet another new side effect is surfacing in Texas that is cause for alarm ...

EARTHQUAKES

Not long ago the first earthquake near gas drilling sites was thought, by some, to be an anomaly.
Now, 17 earthquakes later, in the space of only a few months, we cannot claim pure coincidence,
nor can we ignore the dangers these earthquakes present to gas pipelines and so, to safety.
Nor should we ignore the potential for the earth to cave in on itself as a result of these drilling induced earthquakes.
Click HERE to read a comprehensive account of the Barnett Shale Earthquakes on Bluedaze.

WHAT ELSE DON'T WE KNOW YET ABOUT UNCONVENTIONAL GAS DRILLING? WHY IS IT OK TO PROCEED WITH THIS DRILLING WHEN WE HAVE NO IDEA OF THE CONSEQUENCES, AND SO, NO IDEA IF WE WILL BE ABLE TO REMEDY THEM? DO WE WANT TO LET OURSELVES BE GUINEA PIGS TO DISASTER?
WHY THE HUSTLE? WE'VE GOT A TRADE AGREEMENT WITH QATAR TO BUY THEIR LNG FOR THE NEXT 25 YEARS! (This is the largest announced LNG import project to date for supplying natural gas to the United States, and makes Qatar Petroleum and ExxonMobil leaders in supplying the important U.S. natural gas market. Delivery of LNG to the United States is projected to begin in 2008/2009.) AT 2 BILLION CUBIC FEET PER DAY, THIS AMOUNTS TO MORE NATURAL GAS IN A LITTLE OVER A DAY THAN CAN BE EXTRACTED FROM A DOMESTIC UNCONVENTIONAL SHALE GAS WELL DURING ITS ENTIRE PRODUCTIVE LIFE.

Meanwhile, the Marcellus Shale underlies a huge portion of a highly developed area of our country: high population density with highly developed social patterns, high commerce and traffic areas; it lies beneath some of the purest unfiltered public drinking water supply in the country, and beneath among the oldest and most built up areas of our country. This is an area that is unprepared and ill equipped to immediately absorb the onslaught of an industry that has bought up rights to trammel the surface of the land to grab what's underneath, in what has been compared to the gold rush of 1849.

Yesterday, when both houses of Congress introduced some measure of public and environmental protection, the gas and oil industry lobbyists and propagandists increased their operations, seeking to increase their sphere of influence, to defeat any regulation of their reckless disregard for our communal and most vital resources: air, which they pollute through all the diesel powered equipment necessary to their operations; water, which they pollute through the infiltration of toxic fracking fluid and methane into the ground water and aquifers; and land, which gets polluted by the fluids dumped or deliberately spread on or otherwise leaked onto or into the earth, killing plants, and underground creatures in the vicinity, creating dead zones where nothing will grow, endangering land and airborne creatures as well.
And now too, we are learning, drilling is distressing the earth's internal structure and stability, so that it quakes as it subsides, causing unknowable potential damage according to where and when these events take place.

IT IS LONG PAST TIME TO DEMAND ACCOUNTABILITY!

IT IS TIME TO DEMAND ACTION AND RESULTS!
SPEAK UP PEOPLE. TALK TO YOUR GOVERNMENT
AND TELL THEM TO STOP SITTING ON THE FENCE
OF INFLUENCE PEDDLING AND
TELL THEM TO DUST OFF THEIR BUTTS AND
FIX IT!

Ghostbusting Hydraulic Fracturing... State vs. Federal Regulation (Who You Gonna Call???)

A report, by John Laurent-Tronche, in today's Fort Worth Business Press, "States or Feds: Who gets to regulate hydraulic fracturing?" states:
A recent push by federal legislators to repeal the Energy Policy Act of 2005 could mean companies that employ hydraulic fracturing, a means of stimulating and opening up a well, would have to answer to the U.S. Environmental Protection Agency’s Safe Drinking Water Act about the chemicals they use in the injection process.
...
Legislators and other concerned parties, including environmental groups, are worried the chemicals used – many of which are harmful to humans and other species – could seep into underground water tables and contaminate water supply. The industry argues there haven’t been any instances of contamination to date and federal oversight would impede natural gas and oil development by adding increased permitting requirements and economic burdens.

“We have a 60-year track record on our side,” said Chris Tucker, spokesman for Energy in Depth, a Washington, D.C.-based industry lobbying group comprised of dozens of organizations, including the Texas Alliance of Energy Producers, the Texas Independent Producers and Royalty Owners Association and the Independent Petroleum Association of America. “Why in 60 years that fracing has been used, why now? Why is everyone pissed off now?”

In today's Atomic Insights Blog post: "See No Evil, Hear No Evil Approach to Regulating Hydraulic Fracturing Shale Gas Extraction", Ron Adams counters:
...I also found out that claims of "never a problem with hydraulic fracturing" were carefully stated to ensure that the claim was applicable only to a portion of the full process and did not include the potential for human or mechanical errors during drilling through aquifers, or the potential for surface water contamination. The witnesses that claimed that there was no evidence of contamination from hydraulic fracturing admitted that some parts of the complete process of extracting gas from shale formation had historically caused some issues of contamination or property damage, but the "fracking" process itself had not yet been proven to be the cause of any incidents. (One witness dismissed the reports of previous problems by stating that they were "legacy" issues that have already been corrected through state legislation and/or regulatory changes.)

Though the natural gas industry is adamant that additional regulations will cause it undue financial burdens and limit its ability to supply the abundant, cheap fuel that it claims is a "game changer", it appears evident that the practice of drilling for unconventional gas requires consistently applied regulations set at the federal level, perhaps with some assistance from state agencies that have proven capabilities as the local enforcement arm. As described by the witness from the US Geological Survey, the formations being developed are spread over large areas that do not respect state lines. The potentially affected air and water resources also do not recognize the politically determined boundaries of existing states.

With that 60 year problem free track record in Texas, why is there suddenly such outcry?

The Fort Worth Business Press continues:
The answer, [industry spokesman Chris Tucker] said, is the Marcellus Shale. As soon as natural gas production went from an isolated area in North Texas to nationwide – in Louisiana, Wyoming, New York, Pennsylvania, Arkansas and elsewhere – people began to worry about how to address it.

“[Environmental activists] knew they couldn’t go into Texas and say that the Barnett Shale was a loser or that fracing was dangerous. They couldn’t do that in Oklahoma,” Tucker said. “But once the Marcellus Shale came out and it was clear this was huge, it all came to the forefront.”

Indeed, 34 states now have oil and gas production, said Amy Mall, senior policy analyst with the Natural Resources Defense Council.

“It definitely is a national issue,” Mall said. “It’s no longer a local issue. We think federal regulation under the Safe Drinking Water Act makes sense, because it is a national issue.”

From Atomic Insights:
In many cases, notably the newly developing Marcellus shale formation, the continuous gas reservoirs are deep under the surface of states that have little existing regulatory infrastructure and little experience in deep underground drilling. It is disingenuous for the oil/gas industry and the states that have experience to dig in their heels on a states' rights basis when it is clear that the implications of developing this large and important resource in a responsible manner will require multi-state cooperation with legal enforcement of required practices and should not be dependent on voluntary compliance with vaguely defined ''best practices".

FW Business Press:
Many of the chemicals used in Texas frac jobs can cause irreparable harm to the eyes, skin, sensory organs, respiratory system, brain and nervous system, according to an April 2009 study by The Endocrine Disruption Exchange, a Colorado-based organization that studies chemicals’ effects on human health and the environment. A little more than a month ago, 19 cattle died after ingesting a fluid that originated at a Chesapeake Energy Corp. drill site in Louisiana, according to an April 29 article in the Shreveport Times. Schlumberger Ltd. reportedly was conducting a frac job at the time. The matter is under investigation by the Louisiana Department of Environmental Quality.
...
There have been at least 375 cases of groundwater contamination due to oil and gas operations reported to the New Mexico Oil Conservation Division, according to a list on the government agency’s Web site. Some of the companies responsible are big players in the Barnett Shale.

From TXSharon's blog, Bluedaze today, David Burnett, Director of the Global Petroleum Research Institute, is quoted, saying:
What is the fuss about drilling a Barnett Shale well? A Barnett well site with a drilling rig operating for three months has the same impact as a city of 4,000 people - Water use, solid waste generation, air emissions and traffic. The O&G industry has been slow to realize this—that it has too big an impact on the environment. ...

Bluedaze presents us with this revealing bird's eye view of "Natural Gas Production in the Barnett Shale..."

Thank you TXSharon, for all you do.

The Fort Worth Business Press concludes:
Earlier this year, the New York State Department of Environmental Conservation issued a report saying it found no significant impacts from hydraulic fracturing operations, according to news reports. Only later did the department admit it had not conducted a single test to back up that claim.

DEMAND ACCOUNTABILITY!