Policy Analysis | May 2011

Natural Gas Recovery and "Hydrofracking"

Jeremy Williams

Increasingly, natural gas has gained popularity as a cleaner substitute for fossil fuels, such as coal and oil, and the process known as hydraulic fracturing, or "hydrofracking," has made shale gas an economically viable alternative to conventional natural gas sources. Shale gas is located much deeper in the ground, typically at least 2,000 feet below the surface, and historically has been much more difficult and expensive to recover. Hydrofracking uses a cocktail of water; sand or ceramic material; and various chemicals that are injected at a high pressure into the shale, in order to fracture the rock and release the gas. A vertical hole is dug, then the drill is turned horizontally to continue the well from the vertical bore. Piping encased in cement feeds the mixture of 99 percent water and sand or ceramic, and 1 percent chemicals, into the shale. The sand holds the fracture open so that the gas can seep into the well, and the chemicals work as thickeners and lubricants, allowing the fluid to work its way through the fissures.

Source: U.S. Energy Information Administration

The United States' geologic composition contains large amounts of natural gas, perhaps third in the world behind only Russia and the Middle East, and many SLC states, including Louisiana, Mississippi and Texas, have huge reserves of the fuel. According to the U.S. Energy Information Administration (EIA), although natural gas consumption is rising in the United States, imports have been steadily declining over the last few years. The report points out that, from 2007 to 2010, imports declined by approximately 1.2 trillion cubic feet, or one-third. This is due largely to the rise in domestic production from shale gas formations, which has more than tripled during that same period, resulting in lower natural gas prices, as well as new jobs in the industry. These trends are at least partly attributable to the increased development and use of hydrofracking.

Source: U.S. Energy Information Administration

There are, however, various environmental and health concerns associated with hydrofracking. At least 32 states allow the practice in areas containing natural gas, and in 19 states the practice is carried out on a regular basis. A growing number of residents in states like Texas claim that hydrofracking has fouled their drinking water wells and even caused the tap water to smell like industrial chemicals, according to a report by the Christian Science Monitor. Louisiana will be holding public hearings this summer to consider approving hydrofracking for oil in the Tuscaloosa Marine Shale, near Baton Rouge. Concerns have been raised regarding environmental impacts for the capital city. The practice has been employed since 2008 to drill in north Louisiana's Haynesville Shale, but never in close proximity to such a large a population.

Last month, U.S. Representative Henry Waxman's office released findings that the chemicals used in the hydrofracking process ranged from generally harmless and common substances, such as salt and citric acid, to extremely toxic substances, such as benzene and lead. The report also stated that, between 2005 and 2009, companies used products containing 29 chemicals that are known or possible human carcinogens, such as benzene, toluene, ethylbenzene and xylene (BTEX chemicals), which are regulated under the Safe Drinking Water Act for their risks to human health, or listed as hazardous air pollutants under the Clean Air Act. The report found that approximately 11.4 million gallons of products containing at least one BTEX chemical were injected into the shale over the five-year period.

However, some experts argue that a movement away from other fossil fuels could have positive environmental results, such as cutting carbon dioxide emissions and slowing climate change, the benefits of which outweigh the environmental risks associated with hydrofracking. Don Siegel, a hydrology professor at Syracuse University, believes that drilling for natural gas would benefit the state far more than it would harm it, according to a report by the Syracuse Post-Standard. He points out that, since natural gas is the cleanest of the fossil fuels, then a shift toward expanding gas recovery could cut carbon dioxide emissions by as much as 17 percent, dramatically reducing the state's carbon footprint until alternative energy production becomes more viable. However, even Siegel, and many experts like him, admit that hydrofracking, especially high-volume hydrofracking, which uses millions of gallons of water per well, does entail some inevitable risks and should be heavily regulated.

In the 2005 Energy Policy Act, Congress exempted hydrofracking from federal oversight, but last year the U.S. Environmental Protection Agency (EPA) announced that it was initiating a study to examine the potential adverse impacts of hydrofracking, the results of which can be expected sometime in 2012. The EPA also asked nine of the major natural-gas production companies to begin releasing information pertaining to the chemicals injected into the ground during hydrofracking.

Last December, New York became the first state to restrict hydrofracking, resulting from an executive order issued by then Governor David Paterson, who placed a moratorium on the practice until the state Department of Environmental Conservation (DEC) is able to conduct an assessment of potential environmental impacts. Although the moratorium was set to end July 1 of this year, the DEC has stated that its review will not be completed by that time, most likely ensuring that the practice will be banned in the state for at least the duration of the summer, according a report by the Utica Observer-Dispatch. In addition, this week, the Croton Watershed Clean Water Coalition filed a lawsuit against the DEC on the grounds that hydrofracking violates myriad state environmental laws.

It is likely that other states will see similar debates regarding the use of hydrofracking as a tool for extracting natural gas. The question of jurisdiction, who gets to decide if the practice is appropriate for a particular area or region, will be the subject of ongoing debate. Until the EPA releases its 2012 report, states will most likely be left to decide how these practices are regulated, and to what extent their intervention is required.