Farming Magazine - September, 2012

FEATURES

How to Handle a Frack Attack

Know before you sign a gas lease
By Curt Harler

If you are like thousands of other farm owners in the Northeast, you've had a guy in a pickup truck pull down your lane and start talking five and six-figure payouts for a gas lease on your property. He lets you know right up front that if you don't sign up fast the big bucks will go to your neighbor. He's talking numbers that would let you pay cash for two tractors, that bush hog you've wanted and a grain drill ... all brand-new.


Drilling & Developing the Marcellus Shale, Vertical vs. Horizontal Drilling.
Pennsylvania Independent Oil and Gas Association.

If you're leaning toward saying "yes," put an extra $2,900 in your pocket. In the mid-Atlantic area, about 85,000 farmers and other landowners have attended educational workshops on drilling the Marcellus Shale, said to be North America's largest natural gas reservoir. Those who attended the Penn State extension workshops realized an additional $250,000,000 in their pockets as a result of the educational program. That $2,900 a person bonus for educating yourself is a pretty good return on a few hours' investment.

Whether you favor or oppose the boom in hydraulic fracturing to recover natural gas (commonly known as fracking), everyone agrees that getting good advice before signing any papers is vital.

"If you have been approached by a drilling company about leasing mineral rights on your property, promptly consult an attorney who is familiar with oil and gas law before signing any documents," advises the Pennsylvania Department of Environmental Protection.

Marcellus Shale covers an area from West Virginia to New York, including about two-thirds of Pennsylvania (almost everywhere except the southeast corner of the state). It lies at a depth of 5,000 to 8,000 feet under the silt loam or sandy loam soil being farmed.

If you say "yes" to the pitchmen, are you about to get on shaky ground - literally shaky ground? Many preliminary studies said fracking leads to earthquakes. Some landowners say fracking wrecked their water wells. The petroleum industry says the process is safe and will make the country foreign-energy independent.

The latest research seems to indicate that the fracking process itself does not cause earthquakes, but the scientific jury is out on the impact of putting the water used in fracking - called flowback water or frac returns - into the ground once the well is established.

Lawsuits abound

Not everyone is happy about fracking, but the displeasure goes beyond the usual green and environmental groups one might expect to fight such projects.

Even politicians in many geographies fear that the states have given too much away, and imposed too few restrictions, in the new gas rush. In March 2012, seven municipalities sued the commonwealth of Pennsylvania over its new law regulating the growth of natural gas exploration. The townships say the law unconstitutionally takes away power to control property from towns and landowners.

Plaintiffs are townships in southwestern Pennsylvania, including Robinson, Peters, Cecil and Mount Pleasant in Washington County, and South Fayette in Allegheny County, where exploration of the Marcellus Shale is under way; and Nockamixon Township and Yardley Borough in Bucks County far on the other side of Pennsylvania.


Example of Hydraulic Fracturing
EnergyFromShale.org.

The lawsuit runs about 120 pages. In it, the municipalities cite objectionable provisions including requirements that drilling, waste pits and pipelines be allowed in every zoning district, including residential districts, as long as certain buffers are observed. The case is pending and the implications are huge.

The Marcellus Shale is calculated to hold about 500 trillion cubic feet of gas, more than 20 years' worth of gas at today's consumption rates. Located under much of the Northeast, the Marcellus Shale promises to provide a clean-burning form of domestically produced energy, according to the Marcellus Center for Outreach and Research (MCOR) at Penn State University. Better yet, the supply is close to the big population centers of the Northeast, meaning that transportation costs are minimized.

That said, almost all parties agree that the gas industry needs to have some boundaries. The Pennsylvania Department of Environmental Protection (DEP) is charged with inspecting well sites from construction to reclamation. The DEP works with the Susquehanna and Delaware River basin commissions to create consistent rules for water withdrawal, use, treatment and disposal.

The drilling process

A typical horizontal Marcellus well consists of several strings of steel casing and cement installed through the upper 5,000 to 9,000 feet of the earth, according to MCOR. Proponents say this solid structure protects the all-important groundwater that most farms and many towns rely upon for drinking water.

It also serves to isolate and protect the upper 1,000 feet from migrating methane or brine fluids.

Once the well bore gets down into the target zone in the Marcellus Shale, a horizontal section is pushed through the gas-bearing rock to capture the natural gas. The horizontal section pushes through several naturally occurring vertical fractures in the rock. In short, the well profile look like a capital "L," with the stem being the well and the base being the horizontal section that collects, consolidates and carries the gas.

Here's where the "fracking" comes in. Anyone who has held a hunk of shale in their hand knows that shale is a dense rock. At this point, a technology known as hydraulic fracturing is used to increase the permeability of the shale and allows the natural gas to be released from the shale and flow into the well.

The reason for the horizontal boring is to access more shale without having to drill multiple thousand-foot vertical shafts. However, that multiplies the amount of water required to frac the wells.

MCOR says hydraulic fracturing involves injecting a mix of water and sand, along with a bit of other additives, at high pressure. Typically, 95 percent of the slurry is water, 4.5 percent is sand, and the rest is a mix of hydrochloric acid (to clean the well) and friction-reducing materials that minimize fluid pressure losses.

There is universal agreement in the petroleum industry that the engineering for removal of gas from the Marcellus Shale is solid.

An industry group, EnergyFromShale.org (EFS), says casing and cementing are critical parts of the well construction that not only protect any water zones, but are also important to successful oil or natural gas production from hydrocarbon bearing zones. Industry well design practices protect sources of drinking water from the other geologic zone of an oil and natural gas well with multiple layers of impervious rock.

EFS acknowledges that 2 to 4 million gallons of water are required per well. While admitting it is a public concern, EFS says that is not as much water as it sounds. EFS notes that electrical generation for the Susquehanna River Basin requires nearly 150 million gallons per day.

EFS quotes Dr. Charles Groat of the University of Texas: "Drilling for natural gas in itself doesn't pose a threat to air and water quality, if it's done properly."

Opponents note that engineers at the Fukushima Daiichi nuclear reactor in Japan would have maintained the same stance until the tidal wave swept over the reactor. Nobody had thought to engineer against that sort of natural disaster.

Parallel with the nuclear analogy, opponents of fracking argue that disposal of the water used in fracking is problematic. Known as flowback water, typically the mix has a high concentration of total dissolved solids (TDS), which can include elevated concentrations of barium and strontium and lower levels of organics and radionuclides like radium-226, according to MCOR. The water typically is reused locally or is trucked to a well site for storage in a lined impoundment or steel tank.

Across the Northeast, about 70 percent of flowback water is reused in hydraulic fracturing, according to MCOR.

For better or worse?

Before farmers crawl in bed with a drilling firm, many ask whether they are getting into the marriage for better or for worse. A payment of $75,000 is a powerful incentive to sign a contract, but not if it will cost your family its well water supply or your county its air quality.

The simple answer is that even the experts - even experts from the same university - disagree on the answer. Two sets of researchers at Cornell University, Ithaca, N.Y., recently reached opposite conclusions as to whether the natural gas produced from fracking is better or worse for the environment.

One team from Cornell said natural gas will produce more greenhouse gases than coal. In the "Climatic Change" journal, researchers Robert Howarth, Renee Santoro and Anthony Ingraffea said that the greenhouse footprint from natural gas from shale is "perhaps more than twice as great" as energy from coal.

A couple of months later and in the same journal, Cornell researcher Anthony Cathles said Howarth's team messed up its calculations and underestimated the improvements that will come with better technology for extracting gas from shale.

So, who is right? Is this to be a marriage made in heaven or, as the saying goes, will it be a matter of "marry in haste, repent at leisure"? In short, should a farmer sign on the dotted line?

Federal research

The answer to that question lies in how much the farmer needs the money offered, how much the farmer trusts big oil, and how much the farmer trusts big government and college researchers.

Balance that against the future of your family's drinking water or your operation's irrigation water.

Both federal and state authorities have a host of regulations in place aimed at protecting surface water and groundwater from erosion and sedimentation. In Pennsylvania, the state law is codified in PA Code Chapter 102. Researchers are doing their best to remain objective about the impact of fracking.

"In preliminary findings, our scientists cite a series of examples for which an uptick in seismic activity is observed in areas where the disposal of wastewater through deep-well injection increased significantly," wrote David Hayes, deputy secretary in the Department of the Interior. Most of those studies he referred to were done in the Midwest - Oklahoma, Colorado and Arkansas - not in the Northeast.

Yet work focusing in western Pennsylvania and eastern Ohio done at Youngstown State University seems to implicate deep wells in causing earthquakes, if not polluting water.

The industry replies by noting that a handful of problems is not representative of the nearly 150,000 deep wells that have been dug all across the nation.

This is akin to the aviation industry claiming that air travel is the safest way to go. Skeptics point to the number of planes that crash. Those with a fear of flying are not assuaged, and those who need to be in New York for business hop the red-eye weekly.

The industry cause got a boost in June when the National Research Council released a report saying energy development from shale formations poses a low risk for tremors of significance. That means little tremors are certainly possible, but San Francisco-size earthquakes are unlikely.

In short, there is no cut-and-dried answer to the questions raised. A farmer's best bet is to attend a seminar or two sponsored by a neutral party like a land-grant college, not the shale industry. Weigh the pros and cons. Then do what is best for the long-term health of your family and your farm.

Curt Harler, who has a B.S. in agriculture from Penn State University and an M.S. in ag from The Ohio State University, is a full-time freelance writer specializing in agricultural and green topics.