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Marcellus Shale

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Marcellus Shale is an extensive formation of shale (a type of sedimentary rock that is high in carbon) in New York, Pennsylvania, Ohio, West Virginia, and other states in the region. [1] It underlies about 18,700 square miles in southern New York, including New York City's entire 1,585-square-mile watershed west of the Hudson River.[2] This shale has received renewed attention both because of new estimates of the quantity of methane gas believed to be under these rocks[3] and because of the significant environmental concerns that have been raised about the method of extracting the gas from the shale, "hydrofracking," which is discussed in more detail below.

Contents

August 2011 United States Geological Survey Estimate

On August 23, 2011, the United States Geological Survey (USGS) disseminated a new estimate of the amount of procurable methane gas existing in the Marcellus Shale, which was vastly more in volume than the USGS' previous 2002 estimate. Titled "USGS Releases New Assessment of Gas Resources in the Marcellus Shale, Appalachian Basin," the press release states, "The Marcellus Shale contains about 84 trillion cubic feet of undiscovered, technically recoverable natural gas and 3.4 billion barrels of undiscovered, technically recoverable natural gas liquids according to a new assessment by the U. S. Geological Survey (USGS). These gas estimates are significantly more than the last USGS assessment of the Marcellus Shale in the Appalachian Basin in 2002, which estimated a mean of about 2 trillion cubic feet of gas (TCF) and 0.01 billion barrels of natural gas liquids."[4]

NY Regulations

New York is presently (2011) the only state which has not allowed the process of slick water, high volume, horizontal hydraulic fracturing along long laterals in low-permeability shale formations. Although the new regulations seem to be on a fast track towards passage, despite many flaws.

See also

Concerns about Human Health and the Environment

Don't Frack Me Bro

The method for extracting gas from the Marcellus Shale--a process called "horizontal hydraulic fracturing," or hydrofracking, in which a fluid is injected into the rock which then releases the gas along with radioactive toxins and other hazardous substances in the shale--has raised serious environmental and health concerns.[5] In New Mexico, for example, similar processes have leached toxic chemicals into the water table at 800 sites.[6] To force natural gas out of shale, millions of gallons of fresh, drinkable water are forced through a pipe drilled into the shale at extremely high pressure. A variety of chemicals are added to the water to keep the fractures in the shale open and keep the gas flowing to the surface.[7]

Pro Publica has provided two charts, depicting how the "hydro-fracking" (also called hydrofracking or fracking) process works. "What is Hydraulic Fracturing?" can be seen at: http://www.propublica.org/special/hydraulic-fracturing-national and "Anatomy of a Gas Well can be seen at: http://www.propublica.org/feature/anatomy-of-a-gas-well-426. Although no complete list of the cocktail of chemicals used in this process exists, information obtained from environmental clean-up sites demonstrates that known toxins are routinely being used, including hydrochloric acid, diesel fuel (which contains benzene, tuolene, and xylene) as well as formaldehyde, polyacrylimides, arsenic, and chromates.[8][9] These chemicals include known carcinogens and other hazardous substances.[10]

What Is in Fracking Fluid

Pro Publica reporter Abrahm Lustgarten revealed that as much as 85% of the fluids used during fracking is regularly left underground after wells are drilled in the Marcellus Shale. Translation: "[Over] three million gallons of chemically tainted wastewater could be left in the ground forever. Drilling companies say that chemical make up less than 1% of that fluid...[which] still amount[s] to 34,000 gallons in a typical well." The old school of thought was that only roughly 30% of the fluids stayed in the ground, which has proven false.[11] Toxics Targeting created a video in which they show what they have coined "ignitible water." The video can be seen at right. [12]

Another video of ignitible water can be seen here: http://vimeo.com/4680635

Concerns about the New York City Water Supply

Kill the Drill

Citizen groups have mobilized in New York to oppose hydrofracking. This opposition has deployed several tactics, including a class action lawsuit.[13] New videos have also been produced to educate the public about the dangers of fracking the Marcellus shale. In the video to the left, Manhattan Borough President Scott Stringer calls massive proposed drilling operations in the watershed that provides New York City with its drinking water is the "most alarming environmental news he has heard in a long time, and makes this the number one environmental crisis" they face in the city.

In response to these and other concerns, New York City urged the state to ban methane gas drilling in its watershed on Wednesday, December, 23, 2009. Steven Lawitts, the city's top environmental official, called fracking techniques "unacceptable threats to the unfiltered fresh water supply of nine million New Yorkers," putting the City at odds with the methane gas industry, which considers shale drilling completely safe. Marc LaVorgna, spokesman for NYC Mayor Michael Bloomberg stated, "Based on all the facts, the risks are too great and drilling simply cannot be permitted in the watershed."[14]

The New York Times noted that the New York State Department of Environmental Conservation, which was tasked with "going through a public review of its new rules on hydraulic fracturing," was looking into reports that "gas companies use at least 260 types of chemicals, many of them toxic, like benzene. These chemicals tend to remain in the ground once the fracturing has been completed, raising fears about long-term contamination."[15]

Facts about Drilling

American Rivers, a Washington, D.C. advocacy group, announced on June 3, 2010, that hydrofracking poses a huge threat to the Delaware River, which is the drinking source for nearly 17 million people across New York, New Jersey, and Pennsylvania. In the America's Most Endangered Rivers Report: 2010 Edition report, the American Rivers advocacy group named the Delaware River the number one most at-risk river, due to the threat of extensive drilling into the Marcellus Shale.[16] Here is a great link to a Factsheet produced by the American Rivers Group on the threat faced to the Delaware River by drilling into the Marcellus Shale: http://www.americanrivers.org/assets/pdfs/mer-2010/upperdelaware_factsheet_2010.pdf

New Jersey State Senate Passes Fracking Ban

On June 29, 2011, the New Jersey state Senate, in a 33-1 vote, passed a fracking ban.[17] The vote was largely symbolic though, as New Jersey sits on but a tiny sliver of the Marcellus Shale play.[18]

New York: First a Moratorium, then Gov. Andrew Cuomo Opens Floodgates

From June 2010 through June 2011, New York had in place a de facto moratorium while its Department of Environmental Conservation (DEC) studied the impacts of methane gas drilling, as well as if there were any plausible way for fracking to occur in New York. On July 1, 2011, Cuomo lifted the moratorium, announcing that 85% of the state's land would be open for the procurement of methane gas. Cuomo's office still has to review the draft given to him by the DEC, mostly for legal issues, and then thereafter, a the topic must be open for public sessions for a 30-day period, which is often extended for 60 days. Thus, it could be months before the moratorium is actually officially lifted and the drillers move into town.[19]

Pittsburgh Opts Out

"Citing health and environmental concerns, the Pittsburgh, Pa., city council voted unanimously Tuesday to ban natural gas drilling within the city limits. It is the first such ban in a Pennsylvania city. The 9-0 vote received a standing ovation.

The Pittsburgh bill was drafted by the Community Environmental Legal Defense Fund, a nonprofit advocacy group.

"'Commercial extraction of natural gas in the urban environment of Pittsburgh poses significant threat to the health, safety and welfare of residents and neighborhoods within the city,'" the ordinance said. "'[Drilling] allows the deposition of toxins into the air, soil, water, environment and the bodies of residents.'"

Mayor Luke Ravenstahl, who has indicated he opposes the measure, has 10 days to review it before the ban goes into effect. If he vetoes the bill, six council votes would be needed to override him." From Propublica on Nov. 16, 2010.

You can read more about this here: http://www.propublica.org/article/pittsburgh-bans-natural-gas-drilling

Hazards Identified Around the U.S.

Catskill Mountainkeeper has noted that "A number of these [hydrofracking] fluids qualify as hazardous materials and carcinogens, and are toxic enough to contaminate groundwater resources. There are cases in the U.S. where hydraulic fracturing is the suspected source of impaired or polluted drinking water. In Alabama, Colorado, New Mexico, Virginia, West Virginia and Wyoming, incidents have been recorded by people who have gas wells near their homes. They have reported changes in water quality or quantity following fracturing operations." [20]

Additionally, the new film by Josh Fox, Gasland documents the consequences of largely unregulated gas drilling across the U.S., as described in this video on the right:

More on Marcellus Shale

Pennsylvania

In September 2009, an estimated 8,000 gallons of fracking fluid spilled into a creek near Dimock, Pennsylvania. The spill was blamed on "faulty pipe work" and resulted in a significant fish kill and other fish “swimming erratically,” according to Pennsylvania’s Department of Environmental Protection.[21] Dimock residents subsequently sued Cabot Oil & Gas Corp, claiming the company's natural-gas drilling ha[d] contaminated their water wells with toxic chemicals, caused sickness and reduced their property values. The complaint says residents have suffered neurological, gastrointestinal and dermatological symptoms from exposure to tainted water. They also say they have had blood test results consistent with exposure to heavy metals. The lawsuit accuses Cabot of negligence and says it has failed to restore residential water supplies disrupted by gas drilling.[22] Water contaminated by methane drilling operations like those in Dimock, Pennsylvania, "is often ten times more toxic than water produced from petroleum production, and can contain high concentrations of salts, acids, benzene, toluene, ethylbenzene, xylene, radioactive materials," and other chemicals.[23]

On November 9, 2009, Reuters reported that the owner of 480 acres of land in southwest Pennsylvania claimed Atlas Energy Inc. ruined his land with toxic chemicals used in or released there by hydraulic fracturing and he also claimed to find seven potentially carcinogenic chemicals above permissible levels set by the U.S. Environmental Protection Agency. He performed tests on his well water a year before drilling began and said the water conditions were "perfect." After the drilling began, water tests found arsenic at 2,600 times acceptable levels, benzene at 44 times above limits and naphthalene five times the federal standard. He has decided to sue Atlas Energy Inc for negligence and is seeking an injunction against further drilling, and unspecified financial damages. Jay Hammond, general counsel for Atlas, said Zimmermann's claims are "completely erroneous" and said Atlas will "vigorously" defend itself in court and declined further comment.[24]

On June 4, 2010, a western Pennsylvania natural-gas well owned by EOG Resources Inc. blew out, releasing over one million gallons of gas and drilling fluids before being contained about 16 hours later, as reported by the Wall Street Journal and WCAJTV in Pennsyvania.[25][26] Operators at this site were preparing to extract gas after through [hydrofracking]]. In a press release, the Pennsylvania Department of Environmental Protection stated that it would "aggressively investigate" the methane well blowout and that it would take the "appropriate enforcement action."[27] "As a result, the well released natural gas and flowback (fracturing) fluid onto the ground and 75 feet into the air," the Pennsylvania Department of Environmental Protection said in the press release.

EOG Resources is the new namesake for the company formerly known as Enron. Pennsylvania Governor Ed Rendell has stated that the incident should serve as an open for what could unfold in the future if proper regulation methods are not implemented with expedience.[28] More on this statement can be seen here: http://www.cnbc.com/id/15840232?play=1&video=1517214459

On Jan. 5, 2010, Pro Publica reported that Pennsylvania was dumping hundreds of millions of gallons of the wastewater utilized in extracting natural gas in the Marcellus Shale into streams across the state. They reported that "Pennsylvania was largely unprepared for the vast quantities of salty, chemically tainted wastewater produced by drilling operations...While the state Department of Environmental Protection called for the fluids to be sent through municipal treatment plants, those facilities are largely unable to remove the salts and minerals, also known as Total Dissolved Solids (TDS), from the waste...[R]esearchers still don't know whether high TDS levels are harmful to humans or wildlife. But the analysis found that some public water utilities had exceeded the federal limit for levels of cancer-causing trihalomethanes, which can form when chlorine in drinking-water treatment systems combines with bromide, which can be present in drilling waste."[29]

Louisiana

In the April 30, 2009 [Pro Publica]]'s Abrahm Lustgarten wrote about news he dug up from Louisiana's Shreveport Times. The story revealed that 16 cattle mysteriously and abruptly dropped dead in a "northwestern Louisiana field after apparently drinking from a mysterious fluid adjacent to a natural gas drilling rig, according to Louisiana's Department of Environmental Quality. At least one worker told the newspaper that the fluids . . . were used for . . . hydraulic fracturing.[30]

Texas

In late 2007, three families near Grandview, Texas noticed changes in their well water just after a natural gas well within a couple of hundred yards of their properties was hydraulically fractured. Within days, five goats and a llama had died. All three families noticed strong sulfur smells in their water, making it unusable. At first their water ran dry, and then the water returned with extremely high pressure, blowing out pipes. Showering caused skin irritation. The Railroad Commission of Texas acknowledged that testing of well water found toluene and other toxic contaminants.[31]

Wyoming

Reuters also reports that "the U.S. Environmental Protection Agency found 14 "contaminants of concern" in 11 private wells in the central Wyoming farming community of Pavillion, an area with about 250 gas wells.[32]

776px-Shaleusa2.jpg

Enforcement Problems

With state budget limitations and shortfalls, oil and gas regulators are spread too thin to do their jobs, even with the minimal guidelines in place[33] In West Virginia, for example, for the state's 17 inspectors to visit West Virginia's 55,222 wells once a year, they would have to inspect nine wells a day, every day of the year, with no weekends off, nor any vacation days. While the number of new oil and gas wells being drilled in the 22 states each year has jumped 45 percent since 2004, most states have added only a few regulators.[34]

Texas has largest imbalance, with 273,660 wells and just 106 regulators to oversee them. In late 2007, a Texas state auditor's report found that nearly half of the state's wells hadn't been inspected in the five years between 2001 and 2006, when the data was collected. According to Pro Publica's analysis, the number of new wells drilled each year in Texas has jumped 75 percent since 2003. However, staffing increased just 5 percent during that period and enforcement actions increased only 6 percent.[35]

Maps and charts depicting this problem can be seen here: http://projects.propublica.org/gas-drilling-regulatory-staffing/

The "Halliburton loophole"

In 2005, at the urging of Vice President Dick Cheney, Congress created the so-called "Halliburton loophole" to clean water protections in federal law to prevent the U.S. Environmental Protection Agency from regulating this process, despite serious concerns that were raised about the chemicals used in the process and its demonstrated spoiling and contamination of drinking water. In 2001, Cheney's "energy task force" had touted the benefits of hydrofracking, while redacting references to human health hazards associated with hydrofracking. Halliburton, which was previously led by Cheney, reportedly earns $1.5 billion a year from its energy operations, which rely substantially on its hydrofracking business.)[36]

According to Pro Publica reporter Abrahm Lustgarten, the EPA under Christine Todd Whitman's tenure as Administrator engaged in secret negotiations with industry, while purportedly addressing drinking water issues related to "fracking."[37] In 2004, the EPA undertook a study on the issue and "the EPA, despite its scientific judgment that there was a potential risk to groundwater supplies, which their report clearly says, then went ahead and very surprisingly concluded that there was no risk to groundwater," Lustgarten noted in September 2009. "[P]art of my reporting found that throughout that process the EPA was closer than seemed comfortable with the industry. I filed FOIA requests for some documents and found conversations between Halliburton employees and the EPA researchers, essentially asking for an agreement from Halliburton in exchange for more lax enforcement. The EPA, in these documents, appeared to offer that and agree to that. And it doesn’t appear, by any means, to have been either a thorough or a very objective study." [38]

Attempts to Close the Loophole with the FRAC Act

In June 2009 Representatives Diana DeGette, DeGette, John Salazar and Maurice Hinchey and Senators Robert P. Casey Jr. and Chuck Schumer introduced the Fracking Responsibility and Awareness of Chemicals Act (FRAC ACT).[39] The act is aimed at closing the 'Halliburton loophole' and requiring the oil and gas industry to disclose the chemicals used in drilling projects.

It would amend "the Safe Drinking Water Act to: (1) repeal the exemption from restrictions on underground injection of fluids near drinking water sources granted to hydraulic fracturing operations under such Act; and (2) require oil and gas companies to disclose the chemicals used in hydraulic fracturing operations." The bill could go a long way in determining the future of the hydro-fracturing national gas excavation process in the United States.[40][41][42]

Misleadingly, in an e-mail to Pro Publica reporter Abrahm Lustgarten, Lee Fuller, vice president of government relations for the Independent Petroleum Association of America said the measures in the FRAC Act "run counter to the nation's energy goals -- increasing the supply of American oil and natural gas -- by making it too costly to produce. Statements that hydraulic fracturing is unregulated are simply not true. It's been regulated assiduously by the states for more than 50 years."[43]

Similarly, Richard Ranger, senior policy analyst at the American Petroleum Institute told Pro Publica in May, "We don't think the system is broke, so we question the value of trying to fix it with a federal solution. So proceed with caution if you are going to proceed with regulating this business because it could make a very significant difference in delivering a fuel that is fundamental to economic health."[44]

More of the same occurred during the Thursday, June 4, 2009 Subcommittee On Energy And Mineral Resources Oversight Hearing On "Unconventional Fuels, Part I: Shale Gas Potential." In the hearing, Lynn Helms, an executive of Chesapeake Energy and Director of the Department of Mineral Resources of the Industrial Commission of the State of North Dakota "told the committee that state regulations of hydraulic fracturing are sufficient and effective and insisted that the fracturing process and the chemicals it uses are safe."[45][46]

But, as Lustgarten notes: "a close reading of the law shows that the Safe Drinking Water Act already defers regulatory authority over oil and gas drilling to the states and that reversing the exemption in question would mainly provide a baseline for best practices and give the federal government authority to investigate contamination cases or disastrous accidents."[47]

Colorado Rep. Diana DeGette, a co-sponsor of the FRAC Act, along with Maurice Hinchey (D-NY) and Jared Polis (D-Co) said “I frankly think the oil and gas companies have been running a scare campaign. I don’t know if the oil and gas industry doesn’t understand the bill or if they are intentionally misrepresenting the bill.”[48]

At that same hearing, Rep. Dan Boren (D-OK) stated, "I am proud that I am supported by the oil and gas industry because they employ a lot of people in my state and I am going to stick up for them. I am sick and tired of a lot of folks in my own caucus coming after the largest employer in my state."[49]

In late October 2009, the House of Representatives agreed to include a statement in the Interior and Environment Appropriations bill and report for fiscal year 2010 urging the EPA to reassess the impact of fracking on water supplies. The report stated:

"The conferees urge the EPA to carry out a study on the relationship between hydraulic fracturing and drinking water, using a credible approach that relies on the best available science, as well as independent sources of information. The conferees expect the study to be conducted through a transparent, peer-reviewed process that will ensure the validity and accuracy of the data. EPA shall consult with other federal agencies as well as appropriate state and interstate regulatory agencies in carrying out the study, and it should be prepared in accordance with EPA quality assurance principles."[50]

On March 18, 2010, the Environmental Protection Agency announced that it would lead a $1.9 million for this comprehensive, peer-reviewed study on the impacts hydrofracking would have on water quality and public health.[51] Despite the study, Rep. Diana DeGette (D-CO) has expressed that it is crucial to continue the push forward for the passing of the FRAC Act[52]

The Methane Industry's Counter-Move, the "Fast Track Shale Act" and Other Proposals

Proposed on March 31, 2009 by Rep. Michele Bachmann (R-MN), the methane industry-backed bill would "open Federal Bureau of Land Management and National Forest lands to leasing for exploration, development, and production of oil shale resources, and for other purposes."[53] In short, the bill calls for ignoring all of the environmental concerns raised with regards to the drilling and a strong push forward of natural gas drilling. And, it calls for expanded drilling in America's national parks.

Bachmann and Rep. Patrick McHenry (R-NC) also introduced the so-called "Emergency Energy Cut the Red Tape Now Act of 2009," essentially calling for the suspension of all environmental regulations relating to oil and gas drilling. The bill proposes "to terminate or provide for suspension of the application of Federal laws that restrict exploration, development, or production of oil, gas, or oil shale, to facilitate the construction of new crude oil refineries, and for other purposes."[54]

Other Related Congressional Action

On February 19, 2010, Rep. Henry Waxman (D-CA) and Rep. Edward Markey (D-MA) spearheaded an Energy and Commerce Committee investigation into fracking. They issued letters demanding additional information from corporations like Halliburton, among numerous others. They also sent a memo to Members of the Subcommittee on Energy and Environment detailing the background on the issue, including EPA's recent work on hydraulic fracturing, including the need for additional oversight and investigation.[55]

On May 13, 2010, Sen. Joe Lieberman (I-CT) and Sen. John Kerry (D-MA) unveiled what they called the "American Power Act," that called for the curtailment of greenhouse gas emissions at 17 percent below 2005 levels by 2020 and 83 percent by 2050.[56] Beyond that, the bill also would require oil and methane companies like Halliburton to divulge chemicals used in the hydraulic fracturing of natural gas wells, meaning they must be displayed publicly. This does not mean that the use of such chemicals would be banned; it would simply mean that the cocktail of chemicals used in drilling for methane no longer be deemed a "proprietary secret."[57]

Wyoming Successfully Approves New Rules Requiring Fracking Fluid Disclosure

On June 8, 2010, the Wyoming Oil and Gas Conservation Commission unanimously approved new fracking rules that require operators to disclose the “fracking” fluids injected into natural gas wells. According to the Wyoming Casper Star-Tribune, "Industry organizations and individual companies argued against the new rules claiming that the chemical mixtures used in fracking are proprietary. In response, the Wyoming Oil and Gas Conservation Commission included a measure that requires companies to disclose the information and requires state regulators not to share it with the public."[58]

Industry PR, Groups, and other Information

A new trade organization called the Marcellus Shale Coalition has been funded to fight back citizen opposition and persuade officials to allow drilling to continue without new regulations.

The coalition describes itself in this fashion: "Founded in 2008, the Marcellus Shale Coalition (MSC) is an organization committed to the responsible development of natural gas from the Marcellus Shale geological formation and the enhancement of the region’s economy that can be realized by this clean-burning energy source. The members of the coalition work with our partners across the region to address issues with regulators, local, county, state and federal government officials and communities about all aspects of producing clean-burning, job-creating natural gas from the Marcellus Shale."[59] The coalition consists of over 90 producers, non-profit members, and associate members, including the likes of Halliburton, United States Steel Corporation, American Petroleum Institute, and Chesapeake Energy Corporation. Like most big money-making ventures then, the hydrofracking movement has spread its wings far and wide. The headquarters of the Marcellus Shale Coalition is located in the heart of the Marcellus Shale region, in Canonsburg, PA.

The PickensPlan and National Security Claims

Tycoon T. Boone Pickens has launched an effort to use national security to press for expanded drilling for methane gas in the U.S., saying that "we need to stop relying on our enemies for gas."[60] In an attempt to break from his reputation as the man who swift-boated John Kerry from the White House, Pickens has marketed himself as a leader in "energy independence." He has coined a mantra for the methane drilling industry on Jim Kramer's CNBC show Mad Money on June 4, 2010 that "It's cleaner, it's cheaper, and it's ours."[61] (Kramer has also been a big advocate for investing money in stocks of companies of drilling for methane in the Marcellus Shale region on his show and website.)

President Barack Obama's Statements related to Methane Drilling

In an a speech delivered on the economy at Carnegie Mellon University on June 2, 2010, President Barack Obama stated, "I understand that we can’t end our dependence on fossil fuels overnight. That’s why I supported a careful plan of offshore oil production as one part of our overall energy strategy. But we can pursue such production only if it’s safe, and only if it’s used as a short-term solution while we transition to a clean energy economy. And the time has come to aggressively accelerate that transition. The time has come, once and for all, for this nation to fully embrace a clean energy future . . . It means tapping into our natural gas reserves, and moving ahead with our plan to expand our nation’s fleet of nuclear power plants."[62]

Estimated Size of Methane Gas in the Marcellus Shale Region

Estimated Amount of Methane Associated with Marcellus Shale

Estimates of the size of the reserves range from 1.9 trillion cubic feet (TCF), by the U.S. Geological Survey in 2003,[63] to nearly 500 TCF (which would be the second largest natural gas reserve in the world),[64] by a college professor who has received numerous grants from the American Chemical Society's Petroleum Research Fund.[65]

Significant Purchases of Land

Ultra Petroleum Corporation Marcellus Shale Land Purchase

On Monday, Dec. 21, 2009, Ultra Petroleum Corporation announced it would acquire about 80,000 acres in the Marcellus Shale region for roughly $400 million, expanding its presence there to about 250,000 net acres, with potential for 1,800 drilling sites.[66]

Exxon-Mobil Land Purchase

On December 21, 2009, "Exxon Mobil finalized terms to buy XTO Energy for $31 billion, which included XTO’s rights to 47,000 acres of a lucrative section of the shale. The buyout of XTO Energy by Exxon Mobil could be off if Congress makes hydraulic fracturing illegal, according to language in the contract. The contract stipulates that the $31 billion deal could be terminated if Congress finds the practice unlawful. Rep. Ed Markey, D-Mass., chairman of the energy and environment subcommittee of the Energy and Commerce Committee, said that he plans hearings next year to examine industry practices, including "some of these unconventional extraction techniques." [67]

CONSOL Purchases Dominion Exploration and Production

On March 15, 2010, Dominion announced the sale of its Dominion Exploration and Production business to CONSOL Energy for $3.475 billion.[68] The sale is expected to close on April 30, 2010 and will include 193 employees currently working for Dominion. [68][69] CONSOL is looking for $4 billion to fund the purchase and further develop the operations; Bank of America, Merrill Lynch and PNC Bank have committed to providing financial assistance.[69]

According to CONSOL, Dominion Exploration and Production is known as “one of the oldest and most active drillers in Pennsylvania and West Virginia”.[69] The transaction includes 1.46 million acres for oil and gas drilling with over 9,000 already-producing wells.[69] This transaction includes 491,000 acres of land in the Marcellus shale formation of Pennsylvania and West Virginia, and almost triples the amount of land rights CONSOL owns in the Marcellus area.[68][69] CONSOL expects to extract more than 41 billions of cubic feet equvilent (Bcfe) in 2010.[69]According to CONSOL’s press release, this purchase will make the company the largest producer of natural gas in the Appalachian basin and give CONSOL “a leading position” in the Marcellus area.[69]

After the sale of Exploration and Production, Dominion will continue to focus on and expand its gas pipeline and storage businesses.[68] At the sale of Dominion Peoples (a Pennsylvania natural gas distribution company), Dominion CEO Thomas F. Farrell II stated, “We are not leaving Pennsylvania by any means. We are expanding our large natural gas transportation and storage system in the state to handle the influx of gas from the Marcellus Shale and other new sources.”[70]

Methane Gas Industry and Lobbying Expenditures

In June 2010, Common Cause of New York released a report titled "Deep Drilling, Deep Pockets: Expenditures of the Natural Gas Industry in New York to Influence Public Policy." The report demonstrated that as the gas and oil industry has begun pushing forward with its drilling campaign in the Marcellus Shale, so too has the magnitude of their lobbying expenses. In 2009, says the report, over $650,000 were spent on lobbying, while in the first four months of 2010, that amount has already nearly been surpassed, with two-thirds of the year still remaining. The report goes on to show that the most active lobbying efforts in New York were put forth by Exxon, Chesapeake Energy, and Cabot Oil and Gas. These companies have melded together as a collective trade association that goes by the name of Independent Oil and Gas Association, resembling Pennsylvania's Marcellus Shale Coalition.

Compared to the period between the years 2006 through 2009, a period during which lobbying expenditures totaled nearly $110,000, the expenditures jumped six-fold in 2009, totaling nearly $670,000. And, four months into 2010, that total is already about to be surpassed, as the push for drilling into the Marcellus Shale reaches new levels.[71]

Marcellus Shale and Carbon Capture

On August 17, 2010, Consol Energy VP Steve Winberg said that while the company is focused on producing natural gas from its 250,000 acres in the Marcellus Shale, it also sees the potential for making money from depleted reservoirs for carbon capture of coal plant emissions: “I think pore space is going to become a very valuable commodity if we move into a carbon constrained world." Carbon capture and sequestration (CCS) is a process where carbon dioxide is removed from fossil fuels and stored in underground geologic formations. Consol holds around 4.5 billion tons of coal reserves and more than 1.4 trillion cubic feet of natural gas reserves.[72]

Pennsylvania began seriously looking into CCS in 2008, as part of the requirements of Act 129, a much broader regulatory effort to reduce energy consumption and demand. A 2009 report by the Clinton Climate Initiative conducted for the Pennsylvania Department of Conservation and Natural Resources (DCNR) imagined an integrated CCS network in Pennsylvania, rather than many unaffiliated pilot projects. The report also notes that the Marcellus Shale, once depleted, "could become a potential storage site", particularly because companies have been acquiring land positions. Those positions could make it easier to arrange large CCS projects, although the leases that allow for mineral extraction don’t always automatically allow for injections as well.[72]

However, another DCNR report found that continued exploration and development of the Marcellus Shale “could potentially compromise the integrity of this formation as a viable cap rock in areas of natural gas production.” This is because the Marcellus Shale is developed through hydraulic fracturing, which literally cracks open underground rocks. Those cracks might make sections of the Marcellus Shale unsuitable for CCS, which requires formations to be completely sealed off to keep the carbon dioxide sequestered. That fracturing could also "jeopardize" other CCS sites: the Marcellus Shale, located between 5,000 and 8,000 feet underground, is the geologic “cap” that isolates an even deeper formation called the Oriskany Sandstone. Fractures in the Marcellus could threaten the isolation that makes the Oriskany a CCS candidate. Conventional oil and gas drilling could cause similar problems, the report noted. For that reason, it suggested designating certain areas for carbon dioxide injections, which could prove extremely difficult at a time when gas is a tradable commodity but carbon isn’t.[72]

Meanwhile, Pittsburgh City Councilman Doug Shields introduced a bill to ban gas development anywhere in the city limits. The city may not have the legal authority to enforce that ban, but Shields believes opposition to drilling could eventually lead to a change in state law.[72]

PA Department of Homeland Security collecting and distributing information on drilling protestors

In September 2010, Pennsylvania Gov. Ed Rendell admitted that information about municipal zoning hearings on Marcellus Shale natural gas drilling and a screening of the documentary "Gasland," as well as an anti-BP candlelight vigil and other peaceful gatherings, were the subject of anti-terrorism bulletins being distributed by Pennsylvania's homeland security office. Rendell admitted that distributing the information was tantamount to trampling on constitutional rights, as the bulletins were going to representatives of Pennsylvania's natural gas industry.[73]

Also included in the bulletins were other potential "anti-terrorism security" concerns that it said could involve "anarchists and Black Power radicals." Also listed were demonstrations by anti-war groups, deportation protesters in Philadelphia, mountaintop removal mining protesters in West Virginia, and an animal rights protest at a Montgomery County rodeo. Despite saying he regretted the actions, Rendell said he was not firing his homeland security director, James Powers, but that he was ordering an end to the $125,000 contract with the Philadelphia-based organization that supplied the information, the Institute of Terrorism Research and Response.[73]

Someone who received an Aug. 30 bulletin gave a copy to Virginia Cody, a retired Air Force officer who lives in Factoryville and is concerned about the rapid expansion of Marcellus Shale drilling in northeastern Pennsylvania. Cody gave the document to a friend, who posted it on an online forum largely read by drilling opponents in the area. After it was posted online, Powers sent Cody an e-mail saying that the bulletin was intended for owners, operators and security personnel associated with the state's "critical infrastructure and key resources." He closed by saying, "We want to continue providing this support to the Marcellus Shale Formation natural gas stakeholders while not feeding those groups fomenting dissent against those same companies."[73]

Advocacy Groups Working to Protect Health and the Environment

Leading Media Groups Tracking Marcellus Shale Issues

Industry groups and companies promoting the exploitation of the Marcellus Shale deposits

Industry Companies and Groups Opposing Stonger Environmental Protections

Articles and Resources

References

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  9. Weston Wilson, Letter to Senators Allard and Campbell and Representative DeGette, October 8, 2004. This letter, from a U.S. Environmental Protection Agency Employee, describes how the Bush Administration's EPA produced a scientifically unsupportable conclusion that hydrofracking should not be regulated under the Clean Water Drinking Act.
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