With gasoline approaching a national average of $4 a gallon and some areas already touching the $5 mark, Americans are feeling the pain of petrochemicals in their wallet.
But a new push to exploit a long-known but unavailable resource may offer some relief. It’s shale gas – natural gas that is bound up tightly in solid rock about 5,000 to 6,000 feet underground.
Geologists and energy companies have known it was there for decades, but the technology didn’t exist to get it out.
In recent years, a combination of techniques – horizontal drilling and hydraulic fracturing or “fracking” -- have made it possible to extract shale gas economically.
“This is an opportunity where we can use some home-grown energy sources to fuel our energy, versus having to import it and deal with all the issues you have in terms of national security,” John Pinkerton, the CEO of Range Resources, said.
Range is one of the bigger players in the Marcellus shale, a huge swath of prehistoric seabed that lies some 5,000 to 7,000 feet beneath Pennsylvania, West Virginia, eastern Ohio and southwestern New York.
The estimates vary widely, but depending on whose numbers are correct, there could be anywhere between 20 and 200 years worth of natural gas.
Cracking the shale to release the gas is a complex process. Drill bits reach deep into the ground, then are turned sideways to penetrate the rock. After explosives fracture the shale, millions of gallons of so-called “fracking” fluid – water, sand and other chemicals -- are pumped in under extreme pressure to expand the cracks, freeing the gas to flow back up the well.
The flood of companies pouring into once depressed areas has lit a fire under local economies. Towanda, Pa., population 3,000, has become a boomtown.
“It’s just been fantastic,” hotel owner Gregg Murelle said of the shale gas explosion. He has two hotels in Towanda, both of them filled to capacity with gas field workers. He is putting the finishing touches on a third hotel, which is booked for the next 18 months.
“We’ve been very lucky,” Murelle said. “With this gas industry coming to town, we’ve missed the recession, so to speak. This area did not get hit, we’ve been insulated from it.”
Pennsylvania’s new governor Tom Corbett says shale gas can become a cornerstone in his state's economy. He estimates 40,000 jobs have been created so far.
But opponents of drilling charge he is in the pocket of the gas industry, and they have criticized his refusal to tax gas exploration – forsaking huge revenues that could help close his state’s $4 billion deficit hole.
Corbett is unapologetic.
“If we start taxing one industry because they're bringing in a lot of money to Pennsylvania, what does that say to other industries outside of Pennsylvania that may look to Pennsylvania to come here?” Corbett told Fox News.
The shale gas boom is a relatively new industry and loosely regulated. And with it have come new problems.
Craig Sautner of Dimock, Pa, had a water well suddenly start spewing methane after Cabot Oil and Gas “fracked” a well 1,000 feet from his home.
“They had to put this pipe on here to vent the gas out of it,” he said.
Several homes in the area had similar problems. In fact, the well owned by Norma Fiorentino blew up when a spark ignited gas that had collected at the surface.
Sautner is taking a stand: No more “fracking” without new regulations.
“My daughter would get in the shower in the morning before school, and she would have to get out and lay on the floor because she thought she was going to pass out from all the methane in the water,” he said.
Pennsylvania’s Department of Environmental Protection cited Cabot for a faulty well casing that allowed gas to contaminate the aquifer. Cabot denies any responsibility, but it supplies fresh water to the Sautners and their neighbors. Cabot also settled with the state for $4.1 million.
Sautner’s wife, Julie, says they are living proof of the tradeoff in exploring domestic resources.
“We absolutely believe that America does need to seek out their own natural resources,”she said, “but at what expense?”
Carol and Don Johnson can calculate that expense almost to the dollar. They leased acreage on their farm to East Resources -- hoping for big royalties.
Instead, last May, a huge wastewater pond built by East leaked into a pasture where their cattle were grazing, forcing the entire herd to be quarantined. The Johnsons don’t expect they’ll fetch much at auction next year.
Carol Johnson said she wouldn't be very comfortable eating meat from the herd.
“I don’t know what’s in them, and I don’t want to take the chance," she said. "I wouldn’t want my grandchildren eating them.”
They may never know what their cattle drank. Because of a government loophole, “fracking” is exempt from the federal Clean Water Act. Companies are not required to disclose what’s in their fracking fluids, some of which contain toxic chemicals. The ordeal likely will cost the Johnsons thousands of dollars, but they are not against drilling.
“I am absolutely not against it,” Don Johnson told me. “I’m for it. But it should be done in a rightful way.”
Pinkerton, of Range Resources, agrees. In the past, his company was accused of contaminating ground water, and at one time it used toxic diesel fuel in the fracking fluid. Now Range voluntarily discloses what’s in its mix, and is trying to lead the way with non-toxic fluids and responsible drilling practices.
“We believe very strongly that we need to have a high standard of care,” he said. “And the companies that subscribe to that will be able to go about our business. The ones that don’t – let’s shut them down.”
Pennsylvania’s governor says with a new industry using new practices in such numbers, mistakes were bound to be made. The goal going forward, he says, is to minimize, even eliminate, mistakes.
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