Dimock story continues to gain traction in New York state Senator Ball latest to call for fracking ban after Pa. visit

The rush for shale gas in Pennsylvania, unhindered in the absence of regulatory burdens under Governor Tom Corbett’s administration, continues to provide fodder for skeptics in New York.

Greg Ball, a 35-year-old Republican senator from Carmel, is the latest New York state politician to hold Pennsylvania up as an example of how to botch shale gas development. Today Ball is schedule to meet with residents of Dimock, Pennsylvania who claim water and property have been degraded by shale gas development. The meeting is a backdrop for the senator’s push for a one-year ban on hydraulic fracturing in New York.

Ball said he believes the shale gas development can help New York’s economy, but not the way it is unfolding in Pennsylvania. In a recent Town Hall meeting in Milan, Ball explained the challenge of getting to the bottom of the rhetoric that typifies the debate about the merit of hydraulic fracturing. “The industry will tell me one thing – ‘you can drink the fracking fluid – don’t worry about it, there are no issues whatsoever. And those 20 cows that died?  That was just a mistake, that really never happens ‘… And you have the anti-frackers who say there are four-headed fish and they are walking down the streets and its Armageddon.”

Work pace accelerates leading up to book publication Networking in the Internet age brings aspects of old, new

With Under the Surface now in production, life’s easy. I just sit back and await accolades and income the book will surely generate…

Sounds nice. Here’s the reality I'm learning about book authorship:  Each day brings new surprises, like stray cats on a doorstep. Today I wonder whether it’s more difficult completing an index for a book, or advancing my quest to become adept at social media. I concurrently wonder how much time I should budget for each of these tasks along with the others that I fear falling behind in. The primary task of the day, however, is feeding the blog.  The blog often gets hungry, and the bigger and more successful it becomes, the more feeding it requires. It can tolerate some (but not too many) leftovers – scraps cleverly reheated and spiced up with some original perspective.  It can also get by on the occasional bites of processed informational nuggests generated from institutional sources, if they are newsworthy enough.  (Often they are not).

Most of all, though, the blog thrives on original home-cooked entries. I’m constantly choosing new ingredients, and as even as I write this, I have the window to my online networks open for a look at the ever-present cornucopia of evolving possibilities in the never-ending shale gas epic. The New York DEC’s dilemma dealing with 40,000 comments on the SGEIS review on which shale gas development in New York depends; Governor Cuomo's comments that suggest there will be no fracking in the Empire State during the next budget cycle; the home rule cases making their way through lower court systems that will decide government control over drilling; the price of natural gas in the wake of market gluts; the EPA’s investigation in Dimock, Pa. There are stories overlapping on federal, local and state levels, and the possibilities and permutations are endless.

EPA’s Enck remains central figure in NY’s shale gas future

As previously reported in this blog, Judith Enck was Governor David Paterson’s top environmental advisor in 2008 when the New York DEC did an about face on its stance regarding the safety of hydraulic fracturing. Now Enck heads EPA’s Region II, a position from which she continues to influence New York’s landmark environmental debate, most recently with comments from her staff on the revised SGEIS. 

NY’s drilling ban sprang from seeds sown by Tier residents

It’s easy to associate the organized movements that characterize the shale gas impasse in New York --- now heading into its fifth year --- as forces responsible for that state's drilling moratorium. The most recent chapter of this saga ended Wednesday as the public comment period for New York’s shale gas policy drew to a close. (The New York DEC received more than 18,000 comments noting the deficiency of the SGIES  -- the document that will guide permitting guidelines for high volume hydraulic fracturing.) 

While groups like the Sierra Club, EarthJustice, and Shaleshock continue to leave indelible marks on the discussion, it’s important to keep in mind the origins of the controversy, which had very little to do with institutional environmental causes.

Why Dimock stays central to national energy policy debate

There’s a good chance that those following this blog are following, or at least interested in, events in Dimock, Pa. It’s hard to overstate the influence events in this small rural community could have on debate over the direction of U.S. energy policy.

Here’s why: Dimock, in northern Pennsylvania, sits over one of the most productive sections in the Marcellus Shale. Cabot Oil & Gas, of Houston, Texas, is drilling and hydraulic fracturing hundreds of wells in and around the rural community with record breaking production. After a history of environmental problems and violations related to Cabot drilling, a collection of several dozen residents filed suit against the company for damages related to contamination of their water wells. Cabot is fighting the claims. Dimock is not the only place where residents have found problems with drilling operations or where water has gone bad. But events in Dimock provide precedence for local, state and federal policy makers.

Status of the FRAC Act: Gone today, here tomorrow?

Remember the Fracturing Responsibility and Awareness of Chemicals Act, a.k.a. the FRAC Act?

The legislation was first introduced in Congress in 2008 by Rep. Maurice Hinchey, a Democrat who represents an upstate constituency, including Binghamton and Ithaca, with significant stakes in shale gas development. The bill would eliminate the industry exemption—the so called “Halliburton Loophole”—provided in the 2005 national energy bill that dismisses companies from the burden of disclosing the concentrations and formulas of chemical solutions they inject into the ground to stimulate shale gas production. The FRAC act would require the federal Safe Drinking Water Act – by which other industries must abide – to apply to the drilling industry. Well service companies such as Halliburton would be subject to full disclosure of what exactly they inject into the ground. Consequent revelations could open the door to controls and limits on hydraulic fracturing formulas per federal laws.

The FRAC Act was proposed in 2008 and 2009 with some fanfare and, not surprisingly, it met opposition from the industry, which characterizes any regulation as a determent to economic growth. Although it was reintroduced in 2011 by Reps Diana DeGette and Jared Polis, both Colorado Democrats who also sponsored the original bill, the FRAC Act has been a non-issue due to the Republican-controlled House of Representatives.

This week I chatted with Michael Morosi, a spokesman for Hinchey, about the status of the FRAC Act. I learned that the bill lives as a prototype for a legislative tool that can be quickly taken off the shelf to regulate fracking, depending on two things that will become acutely relevant this election year:

The political climate in Washington;

How the EPA decides to handle the fracking issue.

Regarding the EPA’s approach: Preliminary results of the agency’s study looking into the safety of hydraulic fracturing is expected by year end. The study, supported by Hinchey as a member of the House Appropriations Committee, began in 2010 to reassess a previous determination in 2005, by the Bush EPA, that fracking was not a significant threat to water. This determination, which gave rise to the Haliburton Loophole, has become widely suspect in light of recent contamination blamed on the type of extensive fracking used for shale gas development.  The EPA is looking at cases in Dimock, Pennsylvania, Pavilion, Wyoming, and other places that could influence the agency’s approach to regulating the industry.

The EPA, of course, is subject to another influential force: the national political climate. You can count on that to be unsettled during the run-up to November’s elections. After that you can count on this: The threat of a FRAC Act will not be a factor in a Republican-controlled Congress. It could likely become a factor in a Congress controlled by Democrats, depending how the EPA proceeds after its study is completed. Now add this to the mix: Rumors have circulated that the 73-year-old Hinchey will retire at the end of the year, although his office strongly denies it. (So far there have been no public nods to a possible successor in the Democratic party.)

While the FRAC Act is yet to make it to the floor, its very existence has been an effective political tool to raise awareness and provoke talking points about the Haliburton Loophole, and stimulate a very public debate about the pros and cons of the issue. FRAC Act… Shale gas industry leaders would be happy if they never heard those words again, and they would also be the first to welcome the retirement of the Congressman who introduced it.

What does Total’s purchase of the Utica tell us? Three points to consider

This morning’s announcement by France’s largest energy company to increase its stakes in U.S. shale by $2.32 billion is impressive at face value. Specifically, as reported by Bloomberg’s Brian Swint, Total will take a 25 percent stake in 619,000 acres of Utica in eastern Ohio. As followers of the U.S. shale gas boom know, the Utica is the largely unexplored formation that sits well below the Marcellus and covers an even bigger footprint, extending north to the Great Lakes in New York, east to the New York’s Alleghany mountain range, west into Ohio, and south to Tennessee. Some have suggested that the Utica holds more energy than the Marcellus, although a working knowledge of its potential is yet to be developed.

Chesapeake Energy has been exploring the western part of the Utica, extending into Ohio, and has found natural gas liquids (NGLs). These include ethane, propane, and butane, which are valuable both as fuels and petrochemical feedstock for an array of manufacturing processes and products, including packaging, textiles, fertilizer, coatings, and adhesives. The westernmost part of the formation also holds oil reserves that, like natural gas and NGL, could be produced only by high-volume fracking.

Keep these points in mind when looking for relevance of how the Total investment will impact the shale gas boom that has accelerated with aggressive Marcellus development in Pennsylvania and West Virginia, and stalled in New York due to concerns over the environmental impact of fracking.

1 -- Total is reportedly interested in the liquid part of the Utica, which is in Ohio. The carbon reserves in the Utica, under New York and Pennsylvania, are thought to be primarily dry natural gas, for which the demand has lagged as production from shale reserves in other parts of the country has created a market glut. That could change with market conditions, which are driven by demand. Demand, in turn, is driven largely by policy and politics that reflect public opinion that natural gas development is indeed a bridge to cleaner alternatives, or simply an enabler of a greater dependency on antiquated fossil fuels.

2- Total became limited with its options for shale gas exploration in its own country in July when France outlawed hydraulic fracturing.

3- The U.S., with the second largest shale gas reserves in the world behind China, has continued to attract foreign investors looking to develop and refine their hydraulic fracturing technology on U.S. shale reserves. China National Offshore Oil Corporation (Cnooc), one of the three big Chinese state-run oil companies, owns one-third interest in Chesapeake’s shale projects in Colorado and Wyoming. Royal Dutch Shell, based in Britain, and Reliance Industries, based in India, have also invested in various U.S. shale gas plays. Chesapeake has been looking for an investor to raise capital to develop the western part of the Utica. Total, with available capital but limited by policies in its own country, was a fit.

Overall, Total’s purchase of the Utica fits a trend of foreign investment in U.S. shale production. The western portion of the Utica brings added value due to LNG and petroleum. How this pans out in the long term depends on the baseline belief by the U.S. voting base that there is merit in drilling for and burning of fossil fuels. As the largest energy consumer (soon to be surpassed by China), the U.S. is in a position to drive global energy markets. Without an abiding belief in fossil fuels, demand for the products of shale gas development and fracking will lag and the market incentives for drilling and fracking will weaken. Of course there are other complicating factors. The strength of the economy is a wild card, as the demand for energy tends to rise when times are good. Economic policy… Energy policy…  For more insights into these variables, look to the presidential campaigns that will culminate with November’s elections.