Thursday, November 15, 2012

Let's pressure our bureaucrats to PROVIDE jobs, not KILL them

Washington Must Not Kill America's Energy RevolutionBy Diana Furchtgott-Roth
November 13, 2012

The International Energy Agency has announced that America will displace Saudi Arabia as the world's largest oil producer by 2020. So it's time to take a look at federal regulations that could stand in the way.

America has reserves to be practically self-sufficient, according to the Paris-based IEA, but will environmental interests prevent hydrofracturing, the new technique being used to produce oil and natural gas?

Oil and gas clearly bring benefits. North Dakota's 3 percent unemployment rate is low due to insatiable demand for jobs, not only in energy, but in associated economic activity, such as housing, restaurants, movie theaters -- you name it.

Pennsylvania produces more than 80 billion cubic feet of natural gas a year. It has more than 2,000 wells in the Marcellus Shale, a geologic formation that stretches north into New York and south into West Virginia. Those wells have given the Keystone State an added $11.2 billion in economic activity a year and tens of thousands of jobs.

However, Pennsylvania, North Dakota and other states may have to slow down.

Until now, each state has set its own hydrofracturing rules. But regulations from the Environmental Protection Agency, the Bureau of Land Management and the Department of Energy, among others, are due out in the coming months. They may take the decision-making power away from states and give it to the federal government.

What is hydraulic fracturing, and why is it so controversial? Also known as fracking, it is a method of extracting natural gas and oil from shale formations and packed sand. Wells are drilled 4,000 to 5,000 feet below the surface, and then sometimes curve to drill horizontally. Fluids are then pushed into the well to make them extractable.

Hydrofracturing techniques have been known since the 1940s but have recently become more widespread, and therefore more controversial, as the long, upward trend of oil prices has made shale formations more profitable. Environmentalists do not like hydrofracturing because they are concerned about water contamination. Wells pass through clean-water aquifers, and many fear that chemicals used in hydrofracturing jobs will be released into the earth and contaminate aquifers.

Another concern is disposal of water used in drilling. Typically, 25 percent of water is recycled back to the surface. Many skeptics worry that this water is dumped directly into rivers and streams, or that lined pits used to hold recycled water contaminate soil. Or, accidents involving trucks carrying recycled water could cause irrevocable environmental damage.

Further, the 75 percent of hydrofracked water that remains underground worries people because of possible contamination of aquifers.

Lastly, water usage itself is a point of contention. The critics point out that hydrofracturing jobs deplete large amounts of water, with large jobs using 4 million to 5 million gallons.

Some of these worries, while conscientious, are misguided. Natural gas deposits, at 4,000 to 5,000 feet below ground, are well below the 500-to-700-foot depth of water tables. Dense shale rock lies between the two strata. The rare but well-published cases of water table contamination occurred due to poor casing jobs or improper drilling techniques, and were immediately prosecuted by the government authorities.

Wastewater from the hydrofracturing process is trucked away or piped to Environmental Protection Agency-certified treatment facilities. Until then, companies store it in steel or earthen-lined pits, with steel pits providing the most protection. Some water is recycled and used again for other drilling operations. Flowback from hydrofracturing fluids has never contaminated an underground aquifer or aboveground water source.

Each state should decide what is best for its residents. The New American Energy Revolution is here, and Washington should stay out of the way.

Diana Furchtgott-Roth is a senior fellow at the Manhattan Institute.

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