April 5, 2013 What the Frack?: Making Sense (Maybe?) of the Technology, Ethics and Politi JAF2013_023.PPT 1 What the Frack?: What the Frack?: Making Sense (Maybe?) of the Technology, Making Sense (Maybe?) of the Technology, Ethics and Politics of “Fracking” Ethics and Politics of “Fracking” Adapted from presentation by Michael L. Godec, Vice President ADVANCED RESOURCES INTERNATIONAL, INC. Arlington, VA Seminar of the National Institute for Energy Ethics and Society (NIEES) Arizona State University Tempe, AZ April 10, 2013
Transcript
April 5, 2013
What the Frack?: Making Sense (Maybe?) of the Technology, Ethics and Politics of “Fracking”
JAF2013_023.PPT1
What the Frack?:What the Frack?:Making Sense (Maybe?) of the Technology, Making Sense (Maybe?) of the Technology,
Ethics and Politics of “Fracking”Ethics and Politics of “Fracking”
Adapted from presentation by Michael L. Godec, Vice President
ADVANCED RESOURCES INTERNATIONAL, INC.Arlington, VA
Seminar of the National Institute for Energy Ethics and Society (NIEES)Arizona State University
Tempe, AZApril 10, 2013
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Topics for this PresentationTopics for this Presentation
• Shales: What’s the big deal?
• What is “Fracking”?
• What are really the important considerations -- can we distinguish mythology from facts?
• What are the ethical implications of policy alternatives?
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Shale Gas and Tight OilShale Gas and Tight OilWhat are we talking about?What are we talking about?
• Shale -- a fine-grained, sedimentary rock characterized by breaks along thin laminae or parallel layering or bedding, with low porosity and permeability
• Shale gas -- natural gas found trapped within shale formations
• Tight oil (also known as liquids-rich shales) -- light crude oil contained in shales
• Important facts:
– The permeability of shales is very low – several orders of magnitude lower that construction-grade cement
– Tight oil development uses the same technology as that contributing to the recent shale gas boom.
– Without stimulation, most shales would not be economic to produce
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Shales: Shales: What’s the Big Deal?What’s the Big Deal?
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U.S. Shale Production Forecast to Dramatically Increase, U.S. Shale Production Forecast to Dramatically Increase, Resulting in Lower in Natural Gas PricesResulting in Lower in Natural Gas Prices
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Shales: Shales: What’s the Big Deal?What’s the Big Deal?International Energy Agency ProjectionsInternational Energy Agency Projections
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Source: Source: International Energy Agency, Golden Rules for a Golden Age of Gas: World Energy Outlook, Special Report on Unconventional Gas, OECD/IEA, May 29, 2012
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What Changed the Game?What Changed the Game?
Horizontal Well with Multi-Stage Fracturing
Source: EnCana
• Natural gas production from shallow, fractured shale formations not new
First shale well drilled in Fredonia, NY in 1821
First fractured well in 1947
2.5 million fractures to date worldwide; > 1 million in U.S.
• What “changed the game” was the recognition that one could “create a permeable reservoir” and high rates of gas production by using intensively stimulated horizontal wells
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Distance between shale formation and ground water typically > 1 mile
Vertical fractures rarely grow more than about 300 feet, and are usually much less
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““Fracking” – Bridging a Language BarrierFracking” – Bridging a Language Barrier
• Industry defines “fracking” narrowly, to only include the days worth of activity stimulating the well
• Opponents define it to include the entire process of shale oil and gas development – from well site identification to production well abandonment
• This semantic difference has contributed to many misunderstandings between different stakeholderso Most cited environmental concerns had nothing to do with
industry’s definition of “fracking” operations
• The characterization of “fracking” sets the terms of the discussion and debate.
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Sorting Fact from Fiction?Sorting Fact from Fiction?
• Environmental impacts/benefits of greater natural gas production
• Adequacy of regulatory oversight?
• Impacts on economy and energy security?
• Environmental impacts – real or not?− Ground water contamination
− Water use and disposal
− Chemical handling and reporting
− Air quality
− Induced seismicity
− Others
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Natural Gas Still Emits GHGs, though < Coal/Oil; Could Natural Gas Still Emits GHGs, though < Coal/Oil; Could Displace Renewables as Low-Cost Power AlternativeDisplace Renewables as Low-Cost Power Alternative
Cost of producing energy before subsidies, per megawatt hour. Bloomberg New Energy Finance, 3rd quarter 2009.
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U.S. COU.S. CO22 Emissions at 20-Year Low Emissions at 20-Year Low
• Declining CO2 emissions not due to wind or solar power• Primary reason is availability of low-cost gas
− Due primarily to shale gas development− Gas displacing coal as fuel for power generation
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Natural Gas Believed to Play Critical Role in Natural Gas Believed to Play Critical Role in Reducing Global Emissions of GHGsReducing Global Emissions of GHGs
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Is “Fracking” an “Unregulated” Activity?Is “Fracking” an “Unregulated” Activity?
• One side – Oil & gas industry exemptions (“loopholes”) from federal environmental statutes allows “fracking” to be “unregulated”
• Other side – Exemptions were provided based on conclusions that oil and gas adequately addressed under state regulations
− States were regulating oil and gas activities long before such activities were even considered by federal statutes
− “One size fits all” federal regulations inappropriate given diversity of geology, environment, etc. among states
− Unlike industrial facilities, oil and gas facilities tend to be small and disperse, minimizing local impacts
− No need for regulatory duplication between states and feds
• Nature and extent of current level of activity and sophistication of the technology not foreseen by pre-2008 laws and regulations
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Adequacy of State RegulationsAdequacy of State Regulations
• Within the last several years, every state has introduced new legislation and/or regulations imposing stiffer requirements – in recognition of dramatic growth in activity
• Under Congressional directive, EPA undertaking comprehensive study of the impacts of hydraulic fracturing
− A state regulatory review is part of this assessment
• EPA is also looking at other statutory/regulatory mechanisms to address issues of concern
• Nonetheless, several states have imposed bans or moratoria on fracturing in place (NY, VT, NJ)
• Only NY is thought to have significant potential
− Numerous cities/towns have also issued bans or moratoria; many are being challenged as a violation of state law
− Most moratoria driven by need for better understanding of impacts
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HOW DO CURRENT STATE POLICIES HOW DO CURRENT STATE POLICIES STACK UP?STACK UP?
Key: Legislation and laws in black; rules adopted by state agencies in red; no state action taken in blue.
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Source: http://chemistrytoenergy.com/shale-gas
Economic Implications of “Fracking”Economic Implications of “Fracking”
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Are Ground Water Resources Safe?Are Ground Water Resources Safe?
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Are Ground Water Resources Safe?Are Ground Water Resources Safe?
• One side – “Fracking” poses substantial risk to ground water resourceso Several researchers have claimed that low ground water quality in
some areas is linked to “fracking”
• Other side -- In some cases where contamination was claimed, activities other than “fracking” likely the cause o Sometimes cause is normal oil and gas operations, not unique to
“fracking”
o Activities regulated and enforced under existing authorities
o “Contamination” often existed before oil and gas development
o Methane can come from biogenic sources, coal seams, other non-targeted formations
o Background analyses rare to determine water quality before development began
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Are Ground Water Resources Safe?Are Ground Water Resources Safe?
Source: www.energyindepth.com
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Are Ground Water Resources Safe?Are Ground Water Resources Safe?
• EPA conducted high visibility investigations of alleged ground water contamination in 3 locations (TX, WY, and PA)
o In all cases, investigations were suspended or no conclusive evidence of contamination from oil and gas operations found
• EPA has is performing case study assessments as part of its Study of the Potential Impacts of Hydraulic Fracturing on Drinking Water Resources
o Prospective case studies, where research at the site begins before hydraulic fracturing occurs, and then continues during and after hydraulic fracturing activities.
o Five retrospective case studies at sites where hydraulic fracturing has already occurred, and where contamination of drinking water resources has been reported.
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What about Surface Water?What about Surface Water?
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What about Air Quality?What about Air Quality?
• One side – Natural gas development emits methane, volatile organic compounds, hazardous air pollutants, and GHGs
− Methane has 25 times more impact on warming than CO2
− Few claim life cycle GHG emissions from power generation with gas supplied from shales greater than associated with coal power generation
• Other side -- Emissions from natural gas power generation are half of that of coal
− New EPA proposed NSPS for GHG emissions from power generation are essentially based on this
• Fact – sources of data to support either side’s claims are insufficient – more data are needed!
− Data being collected as part of EPA’s Mandatory Greenhouse Gas Reporting Rule should help clarify and inform
• Recent World Resources Institute study concludes that methane leakage rates need to be below 1% for life cycle climate impacts of gas to be less than coal
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Why Can’t We Know What is Being Put in the Ground?Why Can’t We Know What is Being Put in the Ground?
• One side – Communities have a “right to know” what “toxic chemicals” are being used in fracture stimulations
• Other side – Revealing chemical compositions of fracture fluid formulations reveal valuable corporate trade secrets
• Fact – Most states require reporting of chemicals used in fracturing to state regulatory agencies and emergency response authorities
− But requirements on how its reported, and how proprietary information is protected vary considerably from state-to-state
• Fact -- Industry is developing less toxic alternatives to critical chemicals
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Some Chemicals Used in “Fracking”Some Chemicals Used in “Fracking”
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Chemicals identified vs. Chemicals left Chemicals identified vs. Chemicals left unidentified (in tons)unidentified (in tons)
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More Environmentally Benign Fracture Fluid More Environmentally Benign Fracture Fluid Additives are Being DevelopedAdditives are Being Developed
To minimize environmental risks, the BJ SmartCare family of fracturing fluids and additives uses quantifiable and standardized chemical evaluations to assess products and identify possible alternatives. Photo at left courtesy of Baker Hughes
Source: Halliburton
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What about the Threat of Earthquakes?What about the Threat of Earthquakes?
• Some researchers are demonstrating the frequency and intensity of small earthquakes is increasing in areas of expanding shale gas development
− Though establishing an undisputable linkage for causation has proven illusive
• The National Research Council that concluded “hydraulic fracturing a well as presently implemented for shale gas recovery does not pose a high risk for inducing felt seismic events.”
• Instead, the researchers found — like the USGS did a few months ago — that injection wells were more commonly the culprit for induced seismicity
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What about Other “Quality of Life” Considerations?What about Other “Quality of Life” Considerations?
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Can These New Natural Gas Resources Be Can These New Natural Gas Resources Be Developed In An Environmentally Sound Way?Developed In An Environmentally Sound Way?
• Assuring Safe Hydraulic Fractures
• Drilling Appropriately Constructed Wells
• Reducing Land Use/Social Impacts
• Recycling Water and Reducing Water Use
• Appropriately Siting Disposal Wells
• Controlling/Capturing Methane Emissions
Numerous efforts underway to establish multi-stakeholder developed guidance and best practices
Improved approaches for pursuing this resource are available, without imposing unnecessary costs.
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Examples of Efforts Focused on Best PracticesExamples of Efforts Focused on Best Practices
• American Petroleum Institute “HF series” of best practices guidance documents for hydraulic fracturing
• Marcellus Shale Coalition
• Barnett Shale Energy Education Council
• Appalachian Shale Water Conservation and Management Committee
• Individual corporate Statements of Principles
• STRONGER state regulatory reviews
• Secretary of Energy Advisory Board recommendations
• National Petroleum Council recommendations
• World Resources Institute recommendations
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Center for Sustainable Shale Development Center for Sustainable Shale Development
• CSSD -- independent organization with mission to support continuous improvement and innovative practices through performance standards and third-party certification.
• CCSD provides a forum for diverse stakeholders to share expertise with common objective of developing solutions/ serving as center of excellence for shale gas development
• CCSD is collaborative effort of environmental NGOs, philanthropic foundations, O&G companies and others
• CCSD prepared to offer “seal of approval” to companies meeting established performance standards
• Note – not all environmental groups or O&G companies are supportive of this effort
• See http://www.sustainableshale.org/
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ConclusionsConclusions
• Sorting fact from fiction in the shale gas debate is difficulto This difficulty poses dilemmas for policy-
makers and regulators
• Conflicting environmental objectives complicate transparency and rational assessmento Reduce fossil fuel dependency at all costs vs.o Developing sound sustainable approaches to
shale resource development
• Ethical issues abound between and among critical considerations
• Individual values can play a critical role in where one stands on this issueo And how they perceive the “facts”
