Posts Tagged ‘Shale gas’

How much shale oil and gas is there, really?

October 13, 2014

Click to enlarge.

Source: Bloomberg News.

Shale drillers are a lot more optimistic about potential oil and gas when they talk to shareholders than when they report to the U.S. Securities and Exchange Commission.  Why?

Hint:  The SEC can prosecute for false statements.  Shareholders have to sue.


Hydrofracking: toxic costs for a clean, cheap fuel

February 13, 2013

Double click to enlarge

This chart from a New York Times article last year shows one of the costs of hydraulic fracturing, a technique for extracting natural gas tightly locked in shale strata by means of fracturing the shale and forcing out the gas with a mixture of water, chemicals and sand.   Even when this is done properly, there remains the problem of disposing of the waste water, which contains not only the hydrofracking chemicals but sometimes underground toxic metals and radioactive elements.

Some benefits of hydrofracking are shown in the charts below.  The technique increases the supply of natural gas, which drives down the price, and the increased use of clean-burning natural gas lessens greenhouse gas emissions.  Hydrofracking isn’t the sole reason for either lower prices or lower carbon emissions, but it is a big contributor.


us-carbon-emission-tableNatural gas prices in inflation-adjusted dollars are the lowest since 1976.  Carbon dioxide emissions are the lowest since 1994.  But before we in upstate New York join in the hydrofracking boom, we should ask ourselves—which will be more permanent, the benefits or the costs?   It seems to me that we will still be dealing with the costs long after the boom is over.

Click on Regulation Lax as Gas Wells’ Tainted Water Hits Rivers for the New York Times article.

Click on Why US natural gas prices are so low for analysis of the economics of natural gas.

Click on U.S. Carbon Emissions Fall to Lowest Levels Since 1994 for more about the benefits of clean-burning natural gas.

Click on The record is clear: Obama delivers on clean energy for comment on President Obama’s support for hydrofracking.

Click on A Mysterious Patch of Light Shows Up in the North Dakota Dark for a report on North Dakota’s natural gas boom.

Click on Future Bakken Production and Hydrofracking for a report on the temporary nature of North Dakota’s boom.

How about a hydrofracking severance tax?

November 14, 2012

If we have to have hydrofracking in New York state, there should be a severance tax—that is, a tax on the amount of oil and natural gas produced—just like Texas, Alaska and other oil-producing states have on oil production.

Hydrofracking—hydraulic fracturing and horizontal drilling for shale oil and gas—is a highly controversial method of energy production which, according to opponents, is destructive to land, a threat to the water supply, and a cause of minor earthquakes.  But according to a report this week of the International Energy Agency, the future of oil and gas production in North America is in hydrofracking.   Natural gas prices in the United States already are falling, due to use of this new technology.

Hydrofracking involves (1) drilling a deep vertical well into gas-bearing or oil-bearing strata of shale, (2) drilling a horizontal well into the shale, (3) setting off an explosive charge to fracture the shale and (4) pumping in water mixed with detergent to force the trapped oil or gas to the surface.  Proponents and industry spokesmen say that, if done correctly, there is no danger of the oil, gas or detergent getting into the water supply.  The shale strata are deep below the water table and the horizontal well should be sealed tight.  They have answers to other objections as well.

The problem, as I see it, is that even if hydrofracking can be done safely, being completely sure that it is would require a degree of regulation that is not feasible.  But if there were a severance tax, there would be money to mitigate or compensate for the damage.  New York is generally regarded as the highest-tax state, based on combined state and local taxes.  This new source of revenue, while it lasts, might allow for reductions in state income taxes and local property taxes.

The drilling companies might then go to states that don’t have severance taxes.  The way to get around this would be for the governors of the hydrofracking states to agree among themselves as to what the severance tax should be.  If they can’t agree, the oil and gas companies would have to come to New York state in the end, after they’ve pumped the other states dry and natural gas prices start to rise again.

Click on Hydrofracking picking up steam for an explanation of the technology and an argument against federal regulation.

Click on Shale Gas Will Be the Next Bubble to Pop for a dissent on the economic benefits of hydrofracking for shale gas.

Why New York should hold off on hydrofracking

July 3, 2012

This new documentary by Josh Fox makes a case against hydraulic fracturing for natural gas in New York and rebuts arguments against his earlier documentary, Gasland.

My previous view of the hydraulic fracturing process was that it could be done safely if industry adopted best practices, but the actually drilling would be so scattered there would be no way regulators could make sure everything was done correctly.  Fox cited internal documents of the gas industry indicating that the process was inherently dangerous.  The concrete casings that supposedly prevent contamination of ground water are in fact porous.

Now, I depend on natural gas to heat my home, and I appreciate the human effort and ingenuity that are necessary to bring the gas to my house.  But there are substitutes for gas, and there are no substitutes for clean fresh water.

Maybe there are valid answers to Fox’s arguments.  If so, it will do no harm, except to the financial interests of the gas industry, to hold up on hydrofracking until these answers can be weighed.  The natural gas isn’t going to go away just because there is a delay in drilling for it.

Click on New Anti-Fracking Film by Gasland’s Josh Fox Targets Cuomo: ‘Governor, What Color Will the Sky Be Over New York? for background on Fox’s new documentary from Rolling Stone magazine.  Hat tip for the link to Bill Elwell.

Click on Gasland Director Josh Fox on His New Film, Gas Industry Lies and Government Collusion for more.  [Added 7/4/12]

Click on Shale Gas: The View From Russia for a sidelight from Dimitry Orlov’s ClubOrlov web log.

Click on Reflections on the Natural Gas Revolution That’s Already Begun for musings by Conor Friedersdorf on The Atlantic Monthly. [Added 7/4/12]

Hydrofracking and carbon caps

October 6, 2010

Like almost everybody else I know, I oppose the environmentally destructive practice of hydrofracking – horizontal drilling for shale gas using hydraulic fracturing.  But without the development of large-scale and practical alternatives to natural gas and other fossil fuels, we will have no alternative in the end.

New York state is on top of the northern edge of the Marcellus Shale, a large mostly-underground shale formation extending below West Virginia and parts of Ohio and Pennsylvania.  There are large quanities of natural gas in the pores and cracks of the shale, and conventional technologies are incapable of extracting it.

Hydrofracking involves fracturing underground shale formations by means of shaped explosive charges, and then forcing out natural gas by injecting a mixture of water, sand and chemicals at high pressure.  This requires millions of gallons of water per well.

Part of the water stays in the ground and, opponents say, could work its way into the ground water.

My default position is that we should refrain from hydrofracking, and, for that matter, from surface mining for coal or deep ocean drilling for oil as long as we possibly can.  The natural gas, coal and oil have been underground for millions of years.  They won’t go away if we wait another 10, 20, 50 or 100 years to dig them up.  Maybe in the meantime affordable substitutes for fossil fuel will become available.  Maybe better methods of extraction will be developed.  Maybe there will be some sort of breakthrough which I can’t even imagine.

But hope is not a plan. Easy-to-get natural gas, coal and oil have been used up.  I heat my own house with natural gas, and I know it has to come from somewhere.

Demand for natural gas is increasing at a rapid rate because of the likelihood of caps on emissions of carbon dioxide, one of the greenhouse gasses that is heating up our planet.  Caps on carbon dioxide mean less use of coal and oil and, in the absence of a commercially-available alternative, more use of natural gas and nuclear energy.  Natural gas is clean burning, and nuclear energy produces no greenhouse gasses at all.

One irony is that release of natural gas (methane) into the atmosphere is one of the problems associated with hydrofracking. While natural gas is clean burning, raw natural gas is one of the most potent greenhouse gasses – much more powerful than carbon dioxide.  So it is possible that the increased use of natural gas, whose purpose is to slow down global warming, may help make the problem worse.