Before we go any further, it is important to understand that I am neither for nor against fracking.
It is interesting that a report from early April 2014, by the Intergovernmental Panel on Climate Control (IPCC), indicated that USA CO2 levels were at their lowest level in 20 years, due to fracking. Also, you will note that despite “bad guys” having half of Iran and Iraq’s largest oil refinery, American gas prices have not spiked. That means, because of fracking, the American oil industry does not care as much about foreign oil problems.
If you read my previous editorial piece, you will recall that I said that am an unrepentant pragmatic capitalist. As such, I have largely ignored all the whining and complaining about how we are ruining the planet.
Several months ago there seemed to be a lot of discussion about how fracking was going to ruin Darke County. I found this interesting because my understanding was that the western two-thirds of Ohio are not in a zone that had significant supplies of underground gas and/or oil.
It turns out that the social media in Darke County was alive with talk about old wells in the northern part of the county that were ideal to become fracking waste wells. One social media commentator accused Ohio Department of Natural Resources, Jim Zehringer, of being a terrorist. Interesting!
Mr. Zehringer arranged a local meeting, using Wayne HealthCare as the meeting site, to bring some engineers, scientists and Ohio government officials to Darke County to discuss what was really happening, in this industry, throughout the State of Ohio. Since the meeting was at my place of business, I was invited to attend.
Before we go any further, let’s start with some “real” facts about hydraulic fracturing.
Hydraulic Fracturing Facts
1.) First major hydraulic fracturing experiment in an oil field in Kansas in 1947.
2.) Actual production fracking completed in Oklahoma and in Texas in 1949.
3.) As of 2012 there have been 2.5 million successful fracking projects worldwide.
4.) First high volume fracking project in Oklahoma in 1968.
5.) First project in shale in Piceance Basin (Colorado) in 1973.
6.) First horizontal well in Texas in 1980.
7.) Between 12,450 and 33,200 tons of water is used as a fracturing fluid in the lifetime of a single well.
8.) Approximately 5.28 billion tons of water evaporates from the Mediterranean Sea every normal summer day.
9.) Decline of 253 million acre feet of water in the Ogallala Aquifer since the pumping of water for farms in the 1950s. This equals 570 billion gallons of water or 4.7 trillion pounds of water.
10.) Proppant is a solid material, typically treated sand or man-made ceramic materials, designed to keep an induced hydraulic fracture open.
11.) Fracking fluid may vary in composition and can be gel, foam or slickwater-based. Slickwater-based fluid is generally 99 percent, or more, water.
12.) Radioactive tracer isotopes are sometimes used to determine the injection profile and location of fractures created by the fracking. Amounts per injection are listed in the US Nuclear Regulatory Commission (NRC) guidelines.
13.) Marcellus Shale is a shale formation under the northern half and western third of Pennsylvania. In addition, this formation continues into western New York State, about 75 percent of West Virginia and the southeastern quarter of Ohio.
14.) Utica Shale is a shale formation lying to the west of and under a portion of the Marcellus Shale formation. This formation extends westward to the center of Ohio.
How Fracking Works
Here is how hydraulic fracturing works. While all of the pools of oil have been diminishing over the years, it was discovered that additional gas and oil is encased in porous limestone, sandstone, dolomite rocks and shale at various places throughout the world. It should be understood that it is exponentially more expensive to remove the gas and oil from these formations than just drilling a well into a pool of oil.
As you can tell from the fact sheet, fracking is not new technology. The reason we have not heard more about it, until; recently, is the cost of this technology. In addition, the locations for much of this resource are at underground levels, well below the levels of regular oil wells. Two major fracking well fields are the Barnett Field in Texas (5,000 to 8,000 feet below the ground) and the more well known Bakken Field in North Dakota (at levels of up to 10,000 feet). The eastern fields are in western Pennsylvania, western New York, West Virginia and eastern Ohio. These fields (Marcellus) are generally in the range of 5,000 feet deep.
In addition to the cost of fracturing technology, just digging holes that deep is very expensive. Costs are in the multi-million dollar range to perform fracking at a mile below the surface of the ground.
In order to optimize the cost of well drilling, the typical vertical well is dug down to the appropriate depth. Then, the well is dug from 1,500 to 5,000 feet is a horizontal direction from the bottom of the well and is exploited in a 360 degree direction. So, the diameter of the field, for one well, can be nearly two miles. This feature requires far fewer well rigs and fewer mile deep holes punched in the ground.
When the well is complete to the desired depth a high pressure liquid (mainly water) is pumped into surface of the rock being penetrated along with a media called proppant. The proppant assures that the cracks formed by the high pressure liquid do not close when the fracturing stops. This activity releases the gas or oil for pumping up to the surface.
In Pennsylvania, the oil companies were allowed to take the used liquid and proppant and place it in storage tanks above ground, treat the water and release the treated water into local streams and waterways. The Pennsylvania government has changed its mind and now allows no above ground discharge. A lot of the Pennsylvania waste material now comes to Ohio because it is cheaper to haul and discharge into existing Ohio discharge wells than to drill all new discharge wells in Pennsylvania.
This is part one of a two-part column by Wayne Deschambeau, president and CEO of Wayne HealthCare.