Sunday, September 18, 2011

Tightening Restrictions Upon "Fracking" In The Lower 48 Would Increase The Value Of Alaska's Natural Gas Supply And Get It Out Of The Ground Sooner

There are two reasons for the delay in getting Alaska's natural gas out of the ground and to market. First, high production costs -- the Fraser Institute shows that Alaska is one of the highest-taxed oil provinces in the world (or read the shorter press release HERE). The failure of the state legislature to modify ACES keeps the tax environment unfriendly. This is compounded by the second cause -- low commodity prices. At this time, there is a glut of natural gas on the market, created in large part by the increased use of the technique of hydraulic fracturing, or "fracking", to recover natural gas deposits trapped by rock.

ProPublica has an excellent graphic which illustrates the fracking process. It involves the high-pressure injection of more than a million gallons of water, sand, and various chemicals down and across into horizontally-drilled wells as far as 10,000 feet below the surface. The pressure mixture cracks any rock layers; the resultant fissures are held open by the sand particles so that natural gas from the shale can flow up the well.

Unfortunately, there have been side effects documented. Nearby residents have reported their water wells contaminated and have become sickened by the proximity to the chemicals involved. In a nine-page article, Alaska Dispatch reports some of these occurrences, highlighting the experience of Susan Wallace-Babb, who found it necessary to move from her ranch in Parachute, Colorado to get relief from symptoms resulting from exposure to fracking. Here's the pertinent excerpt:

On a summer evening in June 2005, Susan Wallace-Babb went out into a neighbor's field near her ranch in Western Colorado to close an irrigation ditch. She parked down the rutted double-track, stepped out of her truck into the low-slung sun, took a deep breath, and collapsed, unconscious.

A natural gas well and a pair of fuel storage tanks sat less than a half-mile away. Later, after Wallace-Babb came to and sought answers, a sheriff's deputy told her that a tank full of gas condensate -- liquid hydrocarbons gathered from the production process -- had overflowed into another tank. The fumes must have drifted toward the field where she was working, he suggested.

The next morning Wallace-Babb was so sick she could barely move. She vomited uncontrollably and suffered explosive diarrhea. A searing pain shot up her thigh. Within days she developed burning rashes that covered her exposed skin, then lesions. As weeks passed, any time she went outdoors, her symptoms worsened. Wallace-Babb's doctor began to suspect she had been poisoned.

"I took to wearing a respirator and swim goggles outside to tend to my animals," Wallace-Babb said. "I closed up my house and got an air conditioner that would just recycle the air and not let any fresh air in."

Wallace-Babb did eventually move from Colorado to Winnsboro, Texas in 2006. For the first three years, her symptoms slowly subsided since there was no fracking taking place. Then in early 2010, Exxon re-opened an old oil field 14 miles away from her home and began fracking wells to get them to produce more oil. Within months, Wallace-Babb's symptoms returned, and once again, she must wear a respirator to visit the grocery store. Again, she is looking to move. And if she moves, the process could be repeated; the number of new natural gas wells drilled each year in the United States has skyrocketed from 17,500 in 2000 to a peak of more than 33,000 in 2008, and continues to climb. And increasingly, wells are being drilled in more heavily populated areas, including urban neighborhoods in some cases.

The Alaska Dispatch did not mention another suspected by-product of fracking; localized earthquake swarms. A sudden swarm of minor local earthquakes in North Central Arkansas which began in 2009 correlates with the beginning of fracking operations in that area. Although geologists didn't specifically attribute the quakes to fracking, Steve Horton, an earthquake specialist at the University of Memphis Center for Earthquake Research and Information (CERI), noted that 90 percent of the earthquakes occurring since 2009 have been within 6 kilometers of the associated salt water disposal wells, making the timing too coincidental to ignore. The Arkansas Oil & Gas Commission imposed an emergency moratorium on the drilling of new injection wells in the area, and the earthquakes began to subside.

In addition, some sources are speculating that fracking may have contributed to the August earthquake along the East Coast, although that might be a bit of a reach. RT reports that Braxton County in West Virginia, only 160 miles from the epicenter of the tremor, has seen eight minor movements in 2010 alone. That site has also seen a slew of fracking operations during the previous several years.

The bottom line -- there are too many imperfections in the fracking process to allow it to continue unabated. While there's no need for a blanket ban, there is a need to impose greater restrictions on fracking, perhaps prohibiting it within a certain distance of any sizable town or city, any known earthquake fault, and taking watershed and prevailing winds into consideration. Of course, this would mean a reduction in the natural gas produced through fracking.

This is where Alaska comes in. Our natural gas does not need to be recovered through fracking; it waits patiently for us under the North Slope. Alaska natural gas could compensate for any shortfall resulting from restrictions on fracking. And because the supply of natural gas would initially decrease from additional fracking restrictions, the price of the commodity would rise -- to the point where it would become more economical for the producers to recover it. The producers aren't welfare agencies; they need a market incentive and a reasonable expectation of profit to get Alaska natural gas out of the ground.

Alaska's Congressional delegation should take the lead in spearheading an effort to launch an investigation of fracking, to include holding hearings so that all interested parties can testify, and then draft a bill which will impose sensible restrictions on fracking. Too many people are experiencing ill effects to allow fracking to continue at its present rate. If local governments try to restrict fracking on their own, they run the risk of getting sued by drilling companies, as is the case in Dryden, New York. Small towns may lack the financial resources to defend against suits launched by well-heeled energy giants.

1 comment:

  1. Well, right now I think that you need to not only watch what is happening in the lower 48, also watch Alaska with the possible sale of Enstar Gas to a Canadian firm. Sure that would help get the LNG that is house on the north slope to the lower 48 with far less issues but what able Alaskan;s and their needs. On heating in my home that is a 5star has gone from a total of 90.00 a month during the coldest times (below zero) to and please set down 300.00 a month and I have lowered my heat to 65 and the heat doesn't turn on until 63. We really need to get ready for what is next in their pockets of surprises!