Mid-Atlantic natural gas offers a promise and a threat

By Nathaniel Gillespie

06/10/2008

Dozens of energy companies are busily working to secure leases from private landowners to explore the vast Marcellus Shale layer that underlies much of West Virginia, Pennsylvania, western Maryland and the southern tier of New York State. Geologists have long known that the Marcellus Shale holds vast amounts of natural gas; yet extracting the fossil fuel from its depths -- typically between 5,000 and 9,000 feet below the surface -- was cost-prohibitive. Now advancements in directional drilling and extraction technologies by Halliburton and other energy giants, combined with soaring natural gas prices, have conspired to create a 21st century natural gas boom across much of the Chesapeake Bay watershed.

With landowners signing agreements with companies paying up to $2500 per acre solely for exploratory drilling rights, the incentives are real. If sizeable deposits of gas are discovered, landowners can expect 15% to 18% royalties for one well that may produce several millions dollars worth of gas. For many landowners with personal assets largely tied up in their land, and specifically for farmers who face stagnant revenue and increasing operating costs, the short-term gain of cash is alluring.

But what are the risks to the environment? Amid the rush of so-called "landmen" negotiating five to seven year leases, and the clamor over prospective payments, this question has largely remained unheard.

Industry representatives seeking the riches of the Marcellus Shale contend that this deposit lies so deep that risks of contaminating groundwater are negligible. Still, the risks to water quality are real.

Natural gas may be marketed as the cleaner alternative to diesel fuel (and much cleaner than coal), but the process of obtaining natural gas requires large-scale industrial machinery and a variety of toxic chemicals. Chemicals, water and sand are forced into the geologic formation under enormous pressure in a process known as hydraulic fracturing or "fracking." Pressure forces the natural gas to the surface. With it come millions of gallons of water and a mix of underground materials that must be stored in large sludge pits. Leakage from these sludge pits can contaminate streams and the shallow groundwater table with salts, naturally radioactive materials, and manmade chemicals. Evaporation of volatile organic compounds and the exhaust from diesel engines used to power the industrial process pollute the air.

Fluids injected during fracking, some of which are proprietary and unregulated, can remain in the earth after drilling ceases. In Texas, community drinking water supplies were poisoned with benzene, xylene and other known carcinogenic compounds when the so called the Barnett Shale was exploited using hydraulic fracturing.

The Marcellus Shale formation holds a natural threat of its own -- highly radioactive uranium. This uranium makes the deposit relatively easy for geologists to identify, but can cause harm to drill workers and can accumulate in drilling sediments.

Clearing forests and land for the drilling pads, pipelines, and roads will increase stormwater runoff and the sediment swept into streams and rivers. Each well pad may span between 3 and 5 acres. While Pennsylvania Department of Environmental Protection's regulations mandate only one drilling well per 640 acres on state-owned land, the law does not limit the concentration of drilling pads on private land. Geologists estimate the optimal concentration of wells in the range of one well for each 40 to 140 acres. Miles of dirt and gravel roads will be needed to connect drilling pads to main roads.

One of the greatest uncertainties is the capacity of state regulatory institutions to adequately protect landowners and public water supplies. The agencies are notoriously under-funded and understaffed and they face the inexorable increase in regulatory burden as exploration and drilling progresses. In addition, the technologies and equipment used to obtain natural gas from such deep deposits as the Marcellus are largely unregulated by the federal Clean Water Act and Clean Air Act.

The cumulative effects from drilling - the deforestation and the air and water pollution - represent real threats for the region's streams, rivers and the beleaguered Chesapeake Bay, many of them already are listed by the U.S. Environmental Protection Agency as impaired by sediment and nutrients. Many miles of streams and rivers have never recovered from the damage done by coal mining. Most have little capacity to absorb any extra insults.

Given these factors and our unquenchable thirst for greater domestic energy supplies, the odds seem stacked in favor of industrial progress as opposed to environmental pragmatism. Unless state regulatory agencies match the growth in exploration and drilling with increased numbers of regulators and increased fines when companies fail to protect the environment, the march of energy companies into the Marcellus Shale could overwhelm existing protections to water and air quality.