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From Ron Bishop, 4/11/2010:
“A few “eco-friendly” fracturing schemes are out and about, but they all come with some* issues.”
“Propane is a gas at ordinary pressures, but can be fairly easily liquefied with pressure. It is, of course, a fossil fuel itself. Using propane would get around using millions of gallons of water, but would not deal with some real technological challenges. First, in order to suspend sand or other proppants, liquid propane needs to be thickened, typically by foaming agents like peroxide. Using peroxide requires the addition of even more corrosion inhibitors than when water is used, and biocides are still required to control microbe growth. (I’ve heard misinformation that fracking with propane requires no chemical additives; that’s just not true.)
“The use of propane introduces new problems with controlling a pressurized liquid that quickly turns to a gas when the pressure is released. It’s not easy or cheap, and a lot of gas escapes into the atmosphere. This is a greenhouse gas, though not as potent as carbon dioxide (another [so-called] “green” fracking fluid candidate) or methane.
“And none of these exotic “fluids under pressure” help with the toxicity of the deep brines that still flow out of gas well bores. These brines continue to be among the greatest waste problems faced by the industry.”
______________________________________________________________
Some further observations:
- The only benefit of propane fracking would be the apparent elimination of water usage for the hydraulic fracturing phase of well development.
- Water would still be required for parts of the drilling phase.
- Frequently, one of the key problems caused by gas extraction, groundwater contamination, takes place during the drilling phase, prior to fracking. There are multiple opportunities for groundwater contamination to occur during the drilling phase, starting with the very first stage, which necessarily takes place with no casing in place yet as the lengths of casing can only be inserted as sections of the borehole are drilled out.
- Regardless of the method used to complete (or ‘frack’) a well, the overall footprint of industrial impacts on the landscape, and on future options for land use, remain the same: the same number of pipeyards/chemical storage sites, access roads, well pads, compressor stations, pipelines, and gas processing units.
So:
merely reducing the amount of water hauled to the site for fracking
would leave in place most of the major problems
associated with petro-methane extraction.Keep your eye on the big picture, New York:
hydro (i.e. water) fracking is only one of many ways
petro-methane extraction can ruin us.
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*Ron specializes in understatement.
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Tags: propane fracking
Banning Hydrofracking Is Not A “Taking” of Property
By Mary Jo Long, Esq.
As the public sentiment grows for a ban on High Volume Hydrofracking (HVHF), lawyers and others who speak for corporate profit-making opportunities in natural gas say that laws banning or limiting gas drilling is a “taking” of property. Even some who seem to be on our side make the same claim. This claim is groundless and misguided. It is a scare tactic to prevent public pressure on our elected officials against HVHF.
What is the Legal Status of These Claims?
1. All property in this country is held under the implied obligation that the owner’s use of it shall not be injurious to the community. There is no compensation for limiting that type of use of property, and
2. A “taking” claim does not apply if the property can be used for other purposes even if those uses are not as profitable.
Consider the Source
The claim that the government (fed, state or local) will be sued to recover the value of lost property is made by attorneys and others supporting HVHHF as a method of gas drilling. They say that we, the taxpayers, will have to pay for the lost profits due to the government’s taking of their property. Always bear in mind that lawyers are advocates for their clients. When a Landowners’ Coalition lawyer claims that a ban will be a taking, that lawyer is making an argument in support of his client’s position. Making a claim (I’m going to sue you) doesn’t mean that a lawsuit will really happen nor that a Court will agree with the argument if an actual lawsuit is filed.
What Is the Law on Taking Property by the Government
The Fifth Amendment to the U.S. Constitution provides certain protections to persons. Included in the protections is the phrase “nor shall private property be taken for public use without just compensation.”[i] This is the “taking” referred to by the anti-ban people. This obligation to compensate for taking private property only applied to the federal government until the 14th Amendment to the Constitution expanded the application to state governments as well. Eminent domain is the term most frequently used when a government takes a piece of property: land for a public park, a public road, a public school, etc. The owner of the land is entitled to be paid for the value of the land taken from her. Historical evidence suggests that the original intent of the takings clause did not include mere restrictions on use.
But what if the government, say through a town zoning law or a state law, BANS gas drilling without taking over title to the property where gas companies and gas leaseholders expect to drill for gas? Are governmental laws that restrict the use of the land by restricting a profit making opportunity a “taking” when actual ownership does not change?
The notion that one can do anything he wants on his property is not the law of the land. The US Supreme Court has said “all property in this country is held under the implied obligation that the owner’s use of it shall not be injurious to the community.” Mugler v. Kansas, 123 U.S. 623, 665 (1887) This principle still remains the law of the land even as Court rulings on “takings” have muddied the waters.[ii]
A town government can use its police power[iii] and zoning/land use power to restrict and prohibit uses that it considers to be detrimental to the community. The exercise of these powers does not constitute a “taking.” For example, the Town of Hempstead passed a law prohibiting gravel pit from excavating below the town’s water table. This law was upheld in Goldblatt v. Hempstead, 369 U.S. 590 (1962) as a valid use of the town’s police power. The Supreme Court conceded that the law completely prohibited a prior use by Mr. Goldblatt who had operated a gravel pit for 30 years. But the Court held that depriving the property of its most profitable use does not make the law unconstitutional, nor a taking.
The present case must be governed by principles that do not involve the power of eminent domain, in the exercise of which property may not be taken for public use without compensation. A prohibition simply upon the use of property for purposes that are declared, by valid legislation, to be injurious to the health, morals, or safety of the community, cannot, in any just sense, be deemed a taking or an appropriation of property for the public benefit. Such legislation does not disturb the owner in the control or use of his property for lawful purposes, nor restrict his right to dispose of it, but is only a declaration by the State that its use by any one, for certain forbidden purposes, is prejudicial to the public interests.” Goldblatt at p.593 quoting Mugler v. Kansas.
In 1992 the Supreme Court carved out an exception to this concept in Lucas v. S.C. Coastal Council, 505 U.S. 1003. The Supreme Court expanded the right to be compensated when new laws deprived land of all economically beneficial use. Although Lucas still owned the land, a lower court at trial had found that the property was rendered of zero value by the law which prohibited residential construction beyond a baseline on the beachfront. While the Supreme Court described these as “relatively rare situations”[iv], it has encouraged litigation. At the same time as Lucas slightly expanded the takings doctrine it also reaffirmed the principle that government does not have to pay compensation when it limits “harmful or noxious uses” of property.
It is correct that many of our prior opinions have suggested that ‘harmful or noxious uses’ of property may be proscribed by government regulation without the requirement of compensation. . . .[G]overnment may, consistent with the Takings Clause, affect property values by regulation without incurring an obligation to compensate – a reality we nowadays acknowledge explicitly with respect to the full scope of the State’s police power”[v]
The Court further acknowledged that Lucas would not be entitled to compensation even though he was deprived of all economically beneficial use if his “bundle of rights” did not include the prohibited use to begin with.[vi] Some uses of land are not a part of the land title to begin with. When someone owns property the owner does not have the property right to have a common law nuisance. Government actions that abate common law nuisances are per se not takings. The Court acknowledged there are inherent limits on landowner rights, imposed under background principles of the State’s law of property and nuisance. Thus government can still forbid deleterious uses even to the point of total takings.
Justice Scalia, who wrote the majority opinion in Lucas, says that a “total taking” of personal property would be subject to a lower standard “by reason of the State’s traditionally high degree of control over commercial dealings”[vii] This means that there is no claim of a taking based on a gas lease, which is personal property rather than real property, i.e. land.
Those opposing a ban on hydrofracking base their claims of a “taking” on Lucas but subsequent cases have confirmed the narrowness of the ruling in Lucas.
- Tahoe-Sierra Preservation Council, Inc. v. Tahoe Regional Planning Agency, 535 U.S. 302 (2002) (Court said moratorium was not a regulatory taking);
- Palazzolo v. Rhode Island, 533 U.S. 606 (2001) (part of parcel was worth $200,00, so was not a total taking);
- Lingle v. Chevron U.S.A. 125 S. Ct. 2655 (2005) (recognized that Takings cases were inconsistent. Tried to clarify by saying the inquiry is whether the regulation is “so onerous that its effect is tantamount to a direct appropriation or ouster” i.e. functionally equivalent to the classic taking in which government directly appropriates private property or outs the owner from his property.);
- Gazza v. NYSDEC 89 NY 2d 603 (1999), cert. denied. (Mere diminution in value of property, however serious, is insufficient to demonstrate a taking.)
Conclusion
1. To make a takings argument, the following conditions apply:
a. A taking claim cannot be based on an interest the owner never had, e.g. the right to create a nuisance.
b. A taking claim does not apply if the property can be used for other purposes. i.e. the economic value has not been totally extinguished. Just because the value of the property has been reduced does not mean the owner gets to claim his “expected” profits if he were allowed to fully exploit the property.
c. Personal property, such as a gas lease, has even less recognition as a taking, even if it is a total taking.
2. Property rights, as well as other rights, are limited by the neighborhood of other public interests. The highest court in NYS said in Gernatt Asphalt Products v. Town of Sardinia, 87 N.Y.2d 668 (1996):
A municipality is not obliged to permit the exploitation of any and all natural resources within the town as a permitted use if limiting that use is a reasonable exercise of its police power to prevent damage to the rights of others and to promote the interests of the community as a whole. (at page 684)
3. The police power of the state is the power to regulate persons and property for the purpose of securing the public health, safety, welfare, comfort, peace and prosperity of the municipality and its inhabitants.
[i] “No person shall be held to answer for a capital, or otherwise infamous crime, unless on a presentment or indictment of a grand jury, except in cases arising in the land or naval forces, or in the militia, when in actual service in time of war or public danger; nor shall any person be subject for the same offense to be twice put in jeopardy of life or limb; nor shall be compelled in any criminal case to be a witness against himself, nor be deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation.”
[ii] In 1922 the Supreme Court ruled that the Pennsylvania legislature had overstepped the line by enacting a law forbidding people from removing coal from under other people’s houses and was held to effect a taking. The Court said, “While property may be regulated to a certain extent, if regulation goes too far it will be recognized as a taking.” Penn. Coal Co. v. Mahon, 260 U.S. 393, 415. In 1987 the Supreme Court in Keystone Bituminous Coal Association v. DeBenedictis, 480 U.S. 470 held that a nearly identical law was not a taking. Property is held under the implied obligation that the owner’s use of it shall not be injurious to the community. That principle, the court held, does not require compensation whenever the state asserts its power to enforce a prohibition that is injurious to the community. It is a question that “necessarily requires a weighing of private and public interests.” (pp. 491-492)
[iii] Police power is the power to regulated persons and property for the purpose of securing the public health, safety, welfare, comfort, peace and prosperity of the municipality and its inhabitants. This include prevention, suppression and abatement of public nuisances, including street nuisances and air pollution, preservation of the public peace and tranquility, protection of the public health through sanitation and disposal of waste and from the harmful effects of industrial and commercial development and proper growth of the municipality through zoning. Article IX of the NY State Constitution; Section 10 of the Municipal Home Rule Law; Section 130 of the Town Law; Section 20 of the General City Law and Section 4-412 of the Village Law.
[iv] Lucas v. South Carolina Coastal Council, at p. 1018
[v]Lucas at p. 1022-1023 citing Penn Central Transportation Co. v. New York City, 438 U.S. 104, 125 (1978)
[vi] Lucas at p. 1027.
[vii] Lucas at 1027.
Tags: local ban, statewide ban, takings
FAILURES OF DEC OIL & GAS REGULATION
By Brian Brock
Programs for oil and gas regulation by the New York State Department of Environmental Conservation were reviewed by Interstate Oil & Gas Compact Commission in 1994. The resulting fifty five page report examines the details, but does not provide an overview. Nevertheless Finding I.10 is a good summary: “DMN can not meet its program responsibilities and administer an effective program under current budgetary conditions. The program is at a crossroads in this regard, because the status quo is not a tolerable long-term condition.” The Division of Mineral Resources (DMN) is the principle division in charge of oil and gas regulation.
This review was conducted by a team of six experts from IOGCC, state governments, industry, and an environmental group with observers from the federal government, industry, and another environmental group. First, DEC answered an extensive questionnaire. Next, DEC staff were interviewed in Saratoga Springs NY May 1 to 5. The review team met July 13 to 15 to discuss and prepare the draft report, which was then sent to all involved. The team met a final time August 29 to September 1 to consider all comments and prepare the final report. Funding was from the federal Environmental Protection Agency. The full report, minus some of the appendices, is available at strongerinc.org.
From this final report “New York State Review, IOGCC/EPA State Review of Oil and Gas Exploration and Production Waste Management Regulatory Programs, September 1994”:
Rules and Regulations
“DMN’s regulations … largely originated in 1972. In the mid-1980s, DMN began a process to substantially upgrade its regulations through … the GEIS in July1992. Despite the substantial period of time that has expired since the inception of this effort, revised rules have not been proposed or promulgated to date.” {Page 5} No rules and regulations have been promulgated since. What is more, the recent draft SGEIS was likewise issued without a rules package.
“In absence of upgraded rules [and regulations], DMN relies substantially upon conditions attached to drilling permits to implement new technical guidance. … Such permit conditions only apply to new wells and therefore of limited utility. Enforcement questions may also arise from imposing generally applicable permit conditions without first issuing rules supporting those permitting conditions.” {Pages 5 to 6}
“One of the principal stated missions of the DEC is protection of human health and the environment. However Part 550 [to 559] of DMN’s rules do not expressly include protection of human health and environment as a goal or policy directive.” {Page 6}
“DMN regulations were not in conformance with Article 23 statutes after 1981 [revisions] and were changed as emergency in 1992.” {Appendix B, page 6}
Staffing
“From a peak staff level of 52 in the mid-1980s, the number of positions declined to 44 in FY 90[-91], and still further to 33 in the last two fiscal years. Equally important, non-personal funds for purchase of equipment, computers, gasoline, and supplies were dramatically reduced from $230,850 in FY 90-91 to approximately $76,000 in each of the last two fiscal years.” {Page 12}
“Consequently, six inspector positions [including one filled by an inspector on extended leave] are available statewide to inspect [500 to 600 annually of the] 14,000 active wells and 5,000 wells of unknown status.” {Page 38} Also an estimated 45,000 inactive wells. In 2008, DMN reported inspection of 2,445 sites annually with a staff of 19. The 2009 annual report has yet to be released.
“[Staff for] both regions [8 and 9] are under milage and overtime limitations, and have not been able to replace vehicles or purchase other equipment in the past five years.” {Page 38}
“… field staff indicated that they generally operate in a reactive mode due to staff limitations. For example, they have not conducted routine inspections in the last three years.” {Page 38}
“Additionally inspections such as well plugging, permit transfer, and temporary abandonment inspections are done as resources are available. Many of the 25 gas storage fields have not been inspected over the last 15 years.” {Page 38}
“The legal side of DMN activities suffers from similar resource deficiencies. There is currently one program attorney in headquarters, whose responsibilities are divided between oil/gas and mining activities. While DEC regional attorneys assist DMN regional staff in enforcement matters, this assistance is not always timely or adequate because of competing demands on these DEC attorneys.” {Page 14}
Siting and Permitting
“DMN rules contain several siting provisions, but these provisions apply to wells and not pits or tanks associated the wells.” {Page 21}
“DMN rules related to siting are not comprehensive, since they do not cover areas such as floodplains, wetlands, proximity to drinking water supplies, and depth to groundwater.” {Page 21}
“Fencing flagging, and caging requirements are instituted on a case-by-case basis and are not contained in regulation or guidance documents” {Page 31}
“DMN does not consider operator compliance history when issuing permits.” {Page 17}
“DMN does not provide notice of intention to issues drilling permits and does not allow public comment on drilling permits prior to issuance unless an EIS or other supplementary SEQR document is deemed necessary.” {Page 24} Since the release of the GEIS in 1992, no permit has required EIS or other supplementary SEQR documents.
“Permits are usually issued within 10-14 days of application” {Page 17}
Brine Wastes
“This [1987] survey indicated 8.6 million barrels [360 million gallons] of produced water were generated that year. Most produced water is discharged into streams, discharged to land surfaces, or roadspread for ice and dust control [85 to 90 percent] or recycled for water flooding [or commercially treated, 10 to 15 percent].” {Page 9} Percentages are from Appendix B, page 7.
“In Region 9, according to DMN, there is also a large but unknown number of discharges of produced water directly to land (where there is no pit at the end of the pipe).” {Page 10}
“DMN investigation activities to date have not included abandoned pits and other waste management units.” {Page 44}
“There is no explicit authority in DMN’s rules to require corrective action for non-oil releases.” {Page 27} Releases such as brine and gas.
“There is little or no coordination between DRA, DMN, DOW, and local governments regarding the determination of appropriate controls for roadspreading, the monitoring of environmental impacts, or sharing of information on this practice.” {Page 11} DRA is the Division of Regulatory Affairs, and DOW is Division of Water.
Other Wastes
“DMN’s programs do not require representative testing of drilling cuttings disposed on site, produced brines which are roadspread, or associated wastes.” {Page 29} Associated wastes include stimulating fluids, completion fluids, produced sands, and drying and sweetening chemicals.
“In short, no agency within the DEC is responsible for, or can produce, reliable information on associated wastes generation or disposal.” {Page 9}
“According to DMN, 90% of drilling solids are buried on-site, and 10% are recycled off-site.” {Page 9}
“E&P [exploration and production] waste is regulated by DSW as a municipal waste since it is specifically excluded from the definition of industrial waste.” {Page 19} DSW is Division of Solid Waste.
Orphaned Wells
“Almost 18,000 of the 30,000 wells in the database are not plugged according to DMN records. [Of these 18,000,] the agency has received reports from operators on 12,857 active wells, leaving approximately 5,000 wells of unknown status requiring further investigation.” {Page 42}
“Five thousand three hundred twenty-two unplugged wells of record drilled before 1973 are grandfathered [ie exempted] from financial assurance requirements. … [therefore] DMN holds approximately $12 million of financial assurance to cover a potential liability of $100 million.” {Page 19} Assumes that plugging a well will cost an average of $20,000.
While a few of these deficiencies are addressed in the dSGEIS, those changes would only apply to horizontally drilled shale gas wells.
Changes to the DEC programs since the summer of 1994 have not been documented. The DEC has not cooperated in a follow-up review to evaluate its progress in the last 17 years. In 2006, follow-up reviews for New York and Kentucky were scheduled, but the one for New York never took place. (In contrast, Pennsylvania DEP had its review in 1992, two follow-up reviews in 1997 and 2004, and a review of its hydraulic fracturing program in 2010.) In response to a 2009 survey, DEC claimed that of the 37 deficiencies cited in the 1994 report, they had fully remedied 10 (27%) and partially remedied 14 (38%), but no documentation was provided.
Tags: DEC, DMR, IOGCC, Stronger Inc
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In a February 23rd story, the Denver Post reports that homeowner Tracy Dahl lost his case before the Colorado Oil and Gas Conservation Commission.
Dahl’s water went bad on June 30, 2010, according to the Post story, “the same day that Pioneer fracked its Alibi well about 1300 feet away.”
The COGCC – which “regulates” gas extraction in the state – is notoriously pro-industry, a universal condition of regulating agencies, which really serve the industry they’re supposed to be watchdogging.
According to the story,
“‘There is no question there is something wrong with your well,” commission member Mark Cutright said. ‘The question is whether you proved fracking impacted your well.’
“The commission, in a unanimous vote, ruled Dahl had not.
“‘Alibi is a good name for that well,’ Dahl said.
“The commission investigates dozens of well complaints each year.”
Whether any of those complaints receive a fair hearing is a question worth considering. According to someone present at the hearing, “The landowner…was not allowed to present his side of the story and [was] barred from submitting his consultant’s reports on the grounds they were hearsay.”
The oil & gas industry is used to calling the shots wherever it goes, a reality that must be acknowledged by any individual considering leasing and every public official in every state where the industry seeks drilling permits. To fail to understand the nature of the industry, and the nature of its relationship with its “regulating” agencies, is to pave the way for tragedy and travesty.
Complete Denver Post story here.
From “The Spill Seekers,” Outside Magazine, November 2010
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While I was in Louisiana, there was an event at the Cajundome, in Lafayette, called the Rally for Economic Survival: 11,000 people packed the place to hear the governor, the lieutenant governor, and, of all people, the executive director of the Louisiana Seafood Marketing and Promotion Board rail against the Obama administration for stealing their jobs by imposing a six-month moratorium on deep-water drilling.
“Enough is enough!” raged the lieutenant governor, Scott Angelle, in his thick Cajun accent. “Louisiana has a long and strong, distinguished history of fueling America, and we proudly do what few other states are willing to do. …America is not yet ready to get all of its fuel from the birds and the bees and the flowers and the trees!”
True, but of the six billion to seven billion barrels of oil consumed by the U.S. each year, only about 10 percent comes from federal Gulf of Mexico waters; we get the same amount from both the Persian Gulf and Canada. Louisiana is no longer a significant source of crude, on- or off-shore. What it does supply is cheap labor and a pliant local government. In this, it’s eerily reminiscent of Third World places ruined by oil. The BPs of the world would have you believe oil brings prosperity to the countries where it’s discovered, but it brings misery so dependably that economists have a name for the phenomenon: the resource curse.
Ecuador, Venezuela, Iraq: Bad things happen to countries “blessed” with oil. The Niger Delta is the Mississippi River Delta’s separated-at-birth twin, offering the scariest cautionary tale of all. This tropical river delta held some of the greatest wetlands on earth, with abundant shellfish, crabs, and shrimp, the foundation of the economy and culture, but it also harbored vast oil reserves. In the past 50 years, Shell has grown preposterously wealthy off that oil, while Nigeria, with the tenth-largest oil reserves in the world, has become a post-apocalyptic wasteland. Almost three times as much oil has spilled into the Niger River Delta as was spilled by the Deepwater Horizon: 546 million gallons and counting. The creeks are black, and the crabs and shrimp are dead. There are always leaking, corroded wellheads and pipelines. Gangs of rebels and oil thieves roam the jungle. Flaring rigs fill the air with mercury, arsenic, and carcinogens. Disease is rampant. The government is cardboard.
Southern Louisiana is no Nigeria, but it’s also no longer quite recognizable as the United States. The trailer homes on pilings, the dearth of education, the chronic disease, the fat parish chiefs – I know the Third World when I see it. Cajuns haven’t grown rich on crude; Houston has. And when the oil runs out, there’s nothing left to fall back on.
I bet Angelle would simply argue that oil is worth billions more than seafood. But that’s only because we aren’t sophisticated enough to put a value on all the multifarious “ecosystem services” the gulf provides: benefits of the natural world, resources and processes we all too often take for granted. If we were to add these things to the ledger – all that gulf seafood and the health savings from it, the hurricane protection and wildlife habitat in all those marshes, to name only a few – and apply the calculus of their self-perpetuating sustainability, the astronomical value would blow your mind. It leaves petroleum in the pit. … How much are all those acres of disappearing land worth? What price the mental anxiety of a culture watching its homeland disintegrate? How much added value do you assign oyster reefs because they’ve never, ever blown up and killed anyone? It’s only ignorance – an inability to tally all the gains and losses – that makes oil look good.
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Do yourself a favor: pick up a copy at your favorite newstand and read the whole piece. And say thanks to Outside Magazine.
Tags: the resource curse
EPA hearing comment: “Agencies appear to be captured by an industry they’ve been tasked to regulate”
Comments to the EPA Hearing on Horizontal Drilling /High-Volume Hydraulic Fracturing
September 15, 2010, Binghamton, New York
Good evening. My name is Joan Tubridy; I am the daughter of a NYC Fire Captain, a former farmer for 23 years, and a middle school Math and English teacher for the past 16 years. I am also a member of CDOG (Chenango Delaware Otsego Gas Drilling Opposition Group). I wish to thank Mike Bernhard of Chenango County for his significant contributions to my remarks.
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I grew up believing that state agencies with names like the Department of Environmental Conservation, the Department of Environmental Protection, the Arkansas and Louisiana Departments of Environmental Quality, the Ohio Environmental Protection Agency, and the Texas Commission on Environmental Quality were all obligated to fulfill the mandates of their chosen titles. Over these past two years, I have had a disappointing education. These agencies appear to be captured by an industry they’ve been tasked to regulate.For example, just this past Tuesday, Governor Ed Rendell of Pennsylvania said that the state Office of Homeland Security, which has been sending information about anti-gas drilling groups to law enforcement and drilling companies, will no longer do so. Should we feel reassured?
Furthermore, spokespersons for the Oil and Gas Industry have obfuscated the truth so often that they have apparently deceived pro-gas coalitions, members of Congress, and agencies with “Environmental” in their titles. The industry has repeatedly stated that the horizontal-drilled, high-volume hydrofracturing (HD/HVF) technology that makes the Marcellus Shale such a plum for gas corporations, has been going on safely for decades.
In fact, there has not been one HD/HVF well in the Marcellus or any other shale body in New York. Ever. Two current drilling practices (drilling horizontal wells in sandstones, and fracturing vertical wells in shale) have been co-mingled as if they “added up” to horizontal-drilled, high-volume hydrofractured wells in the Marcellus Shale (HD/HVF). They don’t and here’s why:
The Herkimer sandstone formation in Chenango County, New York, for example, is a porous stone which produces no methane, but which has – over geologic time – absorbed methane from neighboring shale formations. Though horizontally-drilled, these sandstone wells require no fracking. A single square mile filled with 80-acre Herkimer drilling units would not require one drop of frack fluid, nor produce one drop of toxic flowback. But a single square-mile HD/HVF Marcellus drilling unit, containing typically eight 4000-foot well bores on one pad, would require 32,000,000 gallons of fracking fluid.
A sandstone well is drilled once, never fractured, and the gas is gone; shale wells can be fractured multiple times, using increasing amounts of fracking fluids each time, to get decreasing amounts of gas.
Similarly, vertical wells drilled through the thin Marcellus shale encounter only about 150 feet of shale available for fracking, and are legally limited to using 80,000 gallons of fracking fluid per well. So, a fully built-out square mile of vertical Marcellus wells at the legal 40-acre spacing, will therefore yield about 2400 feet of frackable shale and be legally limited to using 1,280,000 gallons of fracking fluid. Compare this with horizontal well bores in that same thin layer in Pennsylvania which are commonly 4000 feet long on an eight-well pad: a total of 32,000 feet of frackable wellbore, requiring 32,000,000 gallons of fracking fluid.
Horizontal-drilled, high-volume hydrofracturing (HD/HVF) in the Marcellus Shale creates twenty-five (25) times the length of frackable wellbore as those created by a fully built-out vertical Marcellus field. That’s twenty-five times the drill cuttings, twenty-five times the flowback wastewater, twenty-five times the truck-traffic for water haulage, and twenty-five times the flowback disposal.
Horizontal-drilled, high-volume hydrofracturing (HD/HVF) in the Marcellus Shale requires fracking fluid that is thirty-five (35) times the legal limit for vertical shale wells, ignoring subsequent re-fracturing. The no-frack Herkimer sandstone experience is irrelevant to the discussion at hand today, though industry would like us to believe that horizontal-drilled, high-volume hydrofracturing (HD/HVF) has been going on for decades.
Another industry obfuscation was recently employed in Pennsylvania when a Chesapeake spokesperson attempted to shift the blame for recent water well problems following gas drilling, to poor construction and drilling of water wells. In his August 22, 2010 letter to the editor of the Sunday Review, Thomas Cummings, a water well driller in Towanda, Pennsylvania refuted this claim by Chesapeake and defended his practices and reputation. Several local homeowners contacted Mr. Cummings regarding disturbances in their water wells that began after nearby gas drilling activity had started. Mr. Cummings states, “The excitement of gas lease funding and large drilling rigs coming to our area has been replaced by damaged roads; delayed travel and traffic snarls; streams sucked dry by convoys of trucks driven by persons foreign to our area … residential sweet water invaded by methane that is blowing off well caps; local families displaced by gas workers; and other changes affecting our work and lifestyles. Our drinking water is being affected and millions of gallons of water are being extracted from our streams, rivers and municipal wells with insufficient recharge.”
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I urge you, the Environmental Protection Agency:1. to be wary of industry’s deliberate deceptions and to examine those mentioned above, and
2. to find individuals who have suffered contamination of their homes by the gas industry, and who have been silenced by money, trucked-in domestic water, and nondisclosure agreements. Legally challenge these nondisclosure agreements and seek out the stories these families have to tell about how their lives have become desperately focused on what most of us take for granted – a healthy home environment for our families.
I urge the Environmental Protection Agency to fulfill the grave obligation imbedded in your name.
Thank you.
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No economic boom, inadequate tax revenues, low royalties, wrecked roads, bad water.
So what else is new?
From NewsInferno.com 9/13/2010:
Fracking in Arkansas Falling Short of Promise
It appears that hydraulic fracturing in Arkansas’ Fayetteville shale isn’t living up to past promises. According to a report in Arkansas Business, depressed natural gas prices have eaten away at royalties and at the state’s severance tax, which was designed to raise revenue to offset the damage the industry causes to roadways.
A gas industry-funded study released in 2008 promised that fracking in Arkansas would have an $18 billion economic impact over five years. The year the study was released, the price of natural gas peaked above $11 per thousand cubic feet (MCF). Since then, Arkansas Business says the national average wellhead price has rarely topped $5 per MCF. That’s significantly cut the amount of royalties gas drillers have paid to mineral rights owners.
When the severance tax was increased in 2008, it was projected to bring in $57 million in its first year. But between the law’s passage in April 2008 and its effective date on Jan. 1, 2009, the price of gas dropped by half. That means that dollars available for road repair have been in short supply, Arkansas Business said.
. . . . .
While the economic boom promised by fracking has yet to materialize, environmental concerns are mounting. According to Arkansas Business, complaints to the Arkansas Department of Environmental Quality (ADEQ) surged in fiscal year that ended on June 30, 2009. That year, ADEQ’s Water Division received 108 complaints related to oil and gas activities and performed 216 inspections. As the 2010 fiscal year drew to a close in June, the number of complaints was about 80.
. . . . .
Some… water contamination incidents that have come out of Arkansas since fracking took off there … include:
• In 2009, a Bee Branch family reported their drinking water turned gray and cloudy and had noxious odors after fracking of a nearby natural gas well owned by Southwestern Energy Company.
• A Center Ridge family reported that in 2007, after hydraulic fracturing of wells owned by Southwestern Energy Company, their water turned red or orange and looked like it had clay in it.
• Another Center Ridge homeowner reported that after hydraulic fracturing of a well owned by Southwestern Energy Company in 2008 his water turned brown, smelled bad, and had sediment in it.
• In 2007, a family in Pangburn reported contamination of drinking water during hydraulic fracturing of a nearby natural gas well owned by Southwestern Energy Company. The water turned muddy and contained particles that were “very light and kind of slick” and resembled pieces of leather.
• In 2008, Charlene Parish, another Bee Branch resident, reported contamination of drinking water during hydraulic fracturing of a nearby natural gas well owned by Southwestern Energy Company. Her water smelled bad, turned yellow, and filled with silt.
See entire piece at http://www.newsinferno.com/archives/23905
Tags: Arkansas, economy, hydraulic fracturing, severance tax, water contamination
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RIL completes deal for 60% stake in Marcellus Shale asset
The Mukesh Ambani-led Reliance Industries has announced the completion of its deal to acquire a 60 per cent stake in the Marcellus Shale gas asset in the United States.
Mukesh Ambani-led Reliance Industries has announced the completion of its deal to acquire a 60 per cent stake in the Marcellus Shale gas asset in the United States for $392 million.
On August 5, Reliance had announced that it will buy its third shale gas asset in the United States. Its subsidiary, Reliance Marcellus II Llc, had signed a definitive transaction agreement to enter into a Marcellus Shale joint venture with U.S.-based Carrizo.
In a statement issued on Saturday, Carrizo Oil and Gas said that it has “closed its previously announced joint venture transaction in the Marcellus Shale with a subsidiary of Reliance Industries.”
The joint venture agreement is effective immediately, the statement added.
“The new Carrizo-Reliance joint venture agreement covers approximately 1,04,400 gross acres in Northern and Central Pennsylvania. Under the terms of the agreement, Carrizo retains a 40 per cent working interest in the acreage and Reliance owns 60 per cent,” the statement said.
Carrizo will continue as operator of the acreage, with Reliance having the right to assume operations in certain parts of Central Pennsylvania after a year, it added.
Under the agreement, Reliance paid $340 million in cash to acquire a 60 per cent stake in the Marcellus shale gas acreage held by Carrizo Oil and Gas Inc and its partner.
The remaining $52million would be incurred on bearing Carrizo’s future seismic survey and drilling costs in the Marcellus shale gas area.
The Marcellus shale acreage was earlier held by a 50:50 joint venture between Carrizo and ACP II Marcellus LLC, an affiliate of Avista Capital Partners.
Reliance has acquired 100 per cent of Avista’s interest in the JV for approximately $327 million and 20 per cent of Carrizo’s interests for a purchase price of $65 million.
In April, the Mumbai-based firm had bought a 40 per cent stake in Atlas Energy Inc’s Marcellus Shale acreage for $1.7 billion. In June, it had agreed to buy a 45 per cent stake in Pioneer Natural Resources Co’s Eagle Ford shale gas asset in Texas for about $1.36 billion.
Reliance would have a net share of 62,600 acres in Carrizo’s shale acreage, less than its 137,000 acre holding in the Atlas venture and 118,000 acres in Pioneer’s assets.
The gross resource potential in Carrizo’s Marcellus Shale area is 3.4 trillion cubic feet of gas, compared to 10 trillion cubic feet in Pioneer’s Eagle Ford asset.
Source: http://www.thehindu.com/business/companies/article627429.ece
Tags: foreign ownership
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