Illinois and fracking

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Energy companies are leasing farmland in southern Illinois, which is situated above the New Albany Shale, a large geologic formation that contains natural gas and oil shale deposits, including byproducts like ethane (used for propane and plastics). The gas and oil in the shale would be accessed through fracking. As of April 2012, up to $100 million has been spent to secure mineral rights in nineteen counties considered favorable for gas exploration.[1]

On May 29, 2013, it was reported that Illinois-based Campbell Energy had submitted a well completion report to the Department of Natural Resources, voluntarily disclosing that it had fracked a well in White County, Illinois.[2]

On May 31, 2013, fracking regulations were passed in the state,[3] beating out HB3086 / SB 1418, which would have imposed a two-year fracking moratorium while assessing the risks.

Introduction

Southeastern Illinois is home to the New Albany shale formation.[4] The Devonian-Mississippian New Albany Shale also stretches to Indiana and Kentucky.

On April 5, 2012, it was reported that energy companies are moving to strike lease deals with landowners and mineral rights owners in the southeastern part of Illinois, with the first test wells in the region expected to be drilled in the next month or two. If some of the wells are successful, it is expected to lead to more leases and drilling. Energy companies in Illinois are seeking natural gas liquids like ethane, a component in making plastics and the fuel propane, which is fetching higher commodity prices than heating-quality natural gas, the price of which has plummeted as supplies have surged with fracking.

Chicago Business noted that the leases could be attractive in places like Wayne County, a mainly farming area 270 miles south of Chicago, where economic opportunities are scarce. Companies are reportedly paying more than $100 an acre for leasing deals with owners, with royalties on anything produced at up to 17.5 percent.[1] Denver-based Strata-X Energy has spent about $2 million in Illinois leasing nearly 50,000 acres.[5]

Legislation moving through Springfield would require drillers to disclose the chemicals used and establish standards for concrete well casings and waste-water storage. The bill, sponsored by Sen. Michael Frerichs, D-Champaign, and backed by the group Faith in Place, is supported by the oil and gas industry after negotiations. The Senate is set to take it up in April 2012.[1]

Regulations had still not been passed in the state House nor Senate on May 29, 2013, when it was reported that Illinois-based Campbell Energy submitted a well completion report last June 2012 to the Department of Natural Resources, voluntarily disclosing that it had fracked a well in White County, Illinois. Companies currently are not required to tell the Illinois DNR what method they use to extract oil and gas, but Campbell Energy included that information anyway.[6]

On May 31, 2013, fracking regulations were passed in the state,[7] beating out HB3086 / SB 1418, which would have imposed a two-year fracking moratorium while assessing the risks.

Fracking sites

The Devonian-Mississippian New Albany Shale lies in the southeast Illinois Basin, encompassing Illinois, Indiana, and Kentucky. The New Albany has been a site for gas production for more than 100 years, but activity has increased since the early 2000s with the development of horizontal wells and fracking. Wells are 250 to 2000 feet deep. The gas is described as having a mixed biogenic and thermogenic origin.

Reserves

A 2011 report by the U.S. Energy Information Administration estimated recoverable natural gas reserves in the New Albany shale at about 11 trillion cubic feet, or slightly less than half of what the entire nation consumed in 2010.[1] (A N.Y. Times analysis later questioned EIA estimates of shale gas reserves, saying they rely heavily on industry estimates and press releases.)[8]

Legislative issues and regulations

2012 regulatory bills

SB3280 and HB3897 (2012) - would require drillers to disclose the chemicals used in fracking and establish standards for concrete well casings and waste-water storage. The Senate is set to take up SB3280 in April 2012.[9] An earlier bill, SB664, originally included language to require chemical disclosure and wastewater management, and to prohibit the use of benzene and other volatile organic compounds. After lengthy negotiations, the provisions were eliminated from the legislation that passed the Senate before failing to clear the House in 2011. The bill was reintroduced as SB3280.[1] The new disclosure bill uses language from ALEC model bills providing large loopholes for companies wanting to protect their fracking chemical “trade secrets” - the loophole legislation was sponsored by ExxonMobil, according to the New York Times.[10] [11][12]

Royalty

HB4312 (2012) - would establish a twelve percent tax on oil and gas revenues.[1]

2013 regulatory bills

On May 21, 2013 the House Executive Committee voted 11-0 to send SB1715, meant to regulate hydraulic fracturing, to the floor of the House.[13] The bill passed in the waning hours of the Illinois General Assembly’s 2013 session, and signed into law by Gov. Quinn.[14]

Although often referred to as the toughest fracking regulations in the U.S., critics say the bill was brokered in a backroom deal by Illinois Democrats, gas industry and labor representatives, and a small cadre of environmental groups, without independent scientists, health experts, or impacted downstate residents at the negotiating table. No public hearings or public comment periods took place. The bill requires chemical disclosure, but has loopholes for trade secrets.[15]

The bill beat out HB3086 / SB 1418, which would have imposed a two-year moratorium in the state on hydraulic fracturing while establishing a process to assess the risks and possible protections.

As of October 2013, companies wishing to engage in horizontal hydraulic fracturing in Illinois must begin registering with the state, a new requirement. The companies must register 30 days before filing an application to drill, which will be posted online.[16]

Citizen activism

March 2012: Illinois residents take on fracking

Several Illinois organizations state that fracking is not safe. One group includes Southern Illinoisans Against Fracturing Our Environment, or S.A.F.E., which is trying to warn homeowners that it could do a lot more damage than energy companies are leading on. The groups are forming a campaign to educate the public about fracking issues in the state.[17]

March 2013: Illinois Residents Vow Civil Disobedience As Fracking Bill Goes Into Effect

In March 2013 Illinois citizens opposing fracking protested at the Illinois State Capitol in Springfield, Illnois in an effort to pressure lawmakers for a two-year moratorium on fracking. Illinois Gov. Pat Quinn had previously signed new legislation that many anti-fracking advocates have vowed to resist because many of the chemicals used in the process would not be released to the public because they were deemed “trade secrets".[18]

Citizen groups

Industry groups

Reports

Resources

References

  1. 1.0 1.1 1.2 1.3 1.4 1.5 Michael Piskur, "Don't Drink The Water? The Race To Keep IL Water Clean Before Fracking Begins," Progress Illinois, April 4, 2012.
  2. Tammy Weber, "Illinois high-volume 'fracking' underway," Associated Press, May 29, 2013.
  3. Julie Wernau, "Fracking regulations passed in Springfield," Chicago Tribune, May 31, 2013.
  4. Steve Daniels, "Fracking comes to Illinois, for better or worse," Chicago Business, April 05, 2012.
  5. Julie Wernau, "Fracking: Public to soon learn who wants to extract Illinois oil: Companies seeking fracking projects must start registering this month with state," Chicago Tribune, October 07, 2013.
  6. Tammy Weber, "Illinois high-volume 'fracking' underway," Associated Press, May 29, 2013.
  7. Julie Wernau, "Fracking regulations passed in Springfield," Chicago Tribune, May 31, 2013.
  8. Ian Urbina, "Behind Veneer, Doubt on Future of Natural Gas" NY Times, June 26, 2011.
  9. "What is Fracking?" Faith in Place, accessed April 2012.
  10. Mike McIntire, "Conservative Nonprofit Acts as a Stealth Business Lobbyist," New York Times, April 21, 2012.
  11. "New year prompts slew of fracking bills" Energy Wire, Ellen M. Gilmer, Feburary 20, 2013.
  12. "For Illinois counties, fracking taxes could be too little, too late" Julie Wernau, Chicago Tribune, March 31, 2013.
  13. [http://www.bnd.com/2013/05/21/2625132/house-panel-gives-ok-to-fracking.html#storylink=cpy "House panel gives OK to 'fracking'; could mean 47,000 jobs for Southern Illinois"> BND.com, May 21, 2013.
  14. Julie Wernau, "Fracking regulations passed in Springfield," Chicago Tribune, May 31, 2013.
  15. Jeff Biggers and Ben Evans, "Illinois’ Flawed Fracking Law Is Everyone’s Problem, Ecologist Says," Yes!, June 4, 2013.
  16. Julie Wernau, "Fracking: Public to soon learn who wants to extract Illinois oil: Companies seeking fracking projects must start registering this month with state," Chicago Tribune, October 07, 2013.
  17. "Residents Take On Fracking Companies" WSILTV.com, March 25, 2012.
  18. "Illinois Residents Vow Civil Disobedience As Fracking Bill Goes Into Effect" Trisha Marczak, MintPress News, June 19, 2013.

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