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The Coming Revolution in LNG Pricing

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Natural Gas Prices To Spike In Europe After Supply Disruptions Here

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U.S. Causal Link Between Fracking and Earthquakes Deepens

The controversial U.S. energy process of releasing natural gas from deep-seated underground reserves has increasingly moved to the forefront of the debate of U.S. energy autonomy.

Advocates insist that hydraulic fracturing, or “fracking,” allows U.S. energy companies to exploit previously uneconomic shale gas resources and maintain that not only is the process environmentally safe but that it contributes to U.S. energy autonomy by developing indigenous  energy reserves, lessening U.S. dependency on foreign energy imports.

Opponents insist that the largely unregulated procedure allows for energy companies to inject unknown chemicals deep underground, including known carcinogens, and that at the very least, energy companies should be required to disclose the chemical cocktail soup of substances used in their exploration and exploitation activities, which the firms involved have strongly resisted.

Now however, a secondary issue has emerged, that fracking has the potential to increase regional earthquakes, another charge that energy companies have strongly denied.

The energy companies involved in the procedure have repeatedly demeaned their opponents as environmentalist extremists, but now a state government is supporting the allegations that fracking does in fact pose the risk of increasing seismic activity, opening the door for class-action lawsuits.

At issue?

The disposal of wastewater produced by fracking, which energy companies inject deep underground.

Ohio state officials told the press on 9 March, “After investigating all available geological formation and well activity data, Ohio Department of Natural Resources regulators and geologists found a number of co-occurring circumstances strongly indicating the Youngstown area earthquakes were induced. Specifically, state officials in their data gathering came to the conclusion that fluids from D&L Energy Inc.'s Northstar 1 disposal well in Youngstown intersected with an unmapped fault in a near-failure state of stress, causing movement along that fault."

The ODNR was referring to 12 quakes centered within a mile of the Northstar 1 hydraulic fracturing natural gas well, opened in December 2010. The first Youngstown earthquake occurred four months later, with the first being registered on 17 March 2011. The well is 9,300 feet deep and reaches the Precambrian bedrock and the tremors continued until late December 2011. While the largest of the seismic events measured a modest 4.0 magnitude on the Richter Scale, environmental groups questioned whether the state's safety rules were robust enough to protect the area from disasters they attributed to hydraulic fracturing.

Ohio state officials closed Northstar 1 on 30 December 2011, a day before the final 4.0 magnitude earthquake. Ohio currently has 177 Class II injection wells, alongside the closed Northstar facility, that dispose of brine, a byproduct from drilling for oil and natural gas, by reinjection of the fluid underground.

Columbus officials were quick to react. In announcing the news state regulations for transporting and disposing of fracking byproduct brine wastewater, the nation's toughest disposal requirements, Ohio Natural Resources Director James Zehringer issued a prepared statement remarking, "Ohio has developed a new set of regulatory standards that positions the state as a national leader in safe and environmentally responsible brine disposal."
Oilprice has already written about the rising evidence linking fracking and earthquakes.

Not surprisingly, the state’s energy industry has pushed back, hard. Ohio Oil and Gas Association executive vice president Thomas E. Stewart whined, “"We plan to thoroughly review the new regulations proposed by ODNR and strongly urge the public and state officials to not allow a rare and isolated event to diminish the excellent service record of Class II injection wells in Ohio.”

Ohio’s economy has been in “rustbelt” decline for years before the 2008 global recession damaged it further, as its many heavy industries were some of the first victims of the rampant outsourcing of U.S. manufacturing jobs over the last 40 years.

In such an environment, the revenues generated from shale natural gas production can only be most welcome in the state treasury, but one can only applaud the state officials promoting a “quality of life” issue for those that remains by investigating the collateral effects of unregulated shale gas production.

And Ohio’s stalwart stance may well encourage other state regulators across the Marcellus shale belt, from New York through the Carolinas to pressure their energy company ‘benefactors’ to come clean about their procedures and their environmental consequences.

It’s enough to make an energy company CEO reach for the Remy Martin and call his broker to unload some of his preferred stock, while rifling through is Rolodex to find a pliant politician .

By. John C.K. Daly of Oilprice.com




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Leave a comment
  • Randy on March 13 2012 said:
    John, what is it with you and your extreme bias for fracking? If you want to be a politician, run for office. If you want to be a jopurnalist, cut the crap such as,"....president Thomas E. Stewart whined"

    Whined? Really? Whined? Gosh that sounds like you don't like this guys opinion on fracking.
  • Steve Messer on March 13 2012 said:
    Thomas Stewart whined? You told everyone with that one word that you are not a person of science and facts but a person of environmental extremisim, politics, or a person with his own unrealistic agenda.
    Also fracing is indirectly connected to water disposal wells. Water from other sources is also put in water disposal wells. The two subjects are only indirectly connected. Water disposal wells by the thousands have existed in this country for almost one hundred years. How do you explain no earthquakes in many many areas in this country that have them?
  • JanZizka on March 13 2012 said:
    "Specifically, state officials in their data gathering came to the conclusion that fluids from D&L Energy Inc.'s Northstar 1 disposal well in Youngstown intersected with an unmapped fault in a near-failure state of stress, causing movement along that fault."

    The last part of that sentence is key. For one it was an unmapped fault, meaning that it was not known to be there so no one, including the state, had any idea there was a possibility of danger there. For another, it would appear that after the fact it was determined to be in a near-failure state of stress to begin with, which makes me question precisely how much the well had to do with its movement and whether it would have moved eventually due to other factors anyway. This to me seems an isolated accident.

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