Hydraulic fracturing used to access oil and gas from rock and shale hasn’t caused “significant” earthquakes, according to a study by Durham University.
“Hydraulic fracturing is not a significant mechanism for inducing felt earthquakes,” Richard Davies, director of the U.K. university’s energy institute, said today in a statement. “The size and number of felt earthquakes caused by fracking is low compared to other manmade triggers such as mining, geothermal activity or reservoir water storage.”
Tremors aren’t the only concern about the method, known as fracking, according to a Greenpeace statement. “Communities have also expressed concern about noise, disruption, traffic, falling house prices and a general industrialization of the English countryside,” Lawrence Carter, an energy campaigner for the environmental group, said in the statement.
Cuadrilla Resources Ltd. drilling caused two tremors in 2011 in northwest England, leading to an 18-month moratorium on fracking, which uses water, chemicals and sand to blast underground rock and release trapped fuel. The government lifted the ban in December and is preparing tax breaks to encourage drillers as it seeks to expand domestic energy sources amid declining North Sea fossil fuel production.
The Durham study of hundreds of thousands of fracking operations since 1929 found the process has the potential to reactivate dormant faults, the university said.
“We cannot see every fault underground and therefore cannot completely discount the possibility of the process causing a small felt earthquake,” Davies said. “But there are ways to further mitigate against the possibility; the oil and gas industry can avoid faults that are critically stressed and already near breaking point.”
Earthquakes caused by mining can range from 1.6 to 5.6 in magnitude and reservoir-filling can trigger tremors of as high as 7.9, according to the study. In comparison, fracking can cause movements of 1 to 3.8 magnitude, it said.
In the Netherlands, two quakes measuring 3.2 and 2.7 struck the gas-rich Groningen area in early February. The tremors near Blackpool in the U.K. two years ago were 2.3 and 1.5.
Of the $133.7 billion spent on U.S. shale ventures between 2008 and 2012, joint ventures with international partners accounted for about $26 billion — roughly 20 percent.
EIA said the activity, “highlights a renewed trend toward foreign joint ventures” as the recent domestic energy boom — propelled by advancements in drilling technology — has drawn interest from abroad.
In 2008, foreign investors struck deals in U.S. shale plays worth about $2 billion over their lifetimes. That figure spiked to about $9 billion in 2010, and hit around $7.5 billion in 2012.
The deals are mutually beneficial, EIA said. “Both U.S. and foreign companies benefit from these deals. U.S. operators get financial support, while foreign companies gain experience in horizontal drilling and hydraulic fracturing that may be transferable to other regions,” it said.
Fracking is the drilling practice that sparked the recent uptick in U.S. energy production. The method injects a high-pressure mixture of water, sand and chemicals into tight shale plays to access hydrocarbons.
EIA said recent investments in shale plays were either acquisitions of U.S. companies by foreign firms or joint operations. Most involved purchasing a portion of the U.S. firm’s shale acreage and agreeing to pay for drilling extra wells within a certain period of time.
While the Marcellus Shale that spans the Appalachian Basin on the East Coast has attracted the most foreign investment, international companies last year parked most of their dollars in the Utica Shale that stretches from Ohio to New York.
The analysis touches on Republican and industry arguments that the domestic energy revolution has been an economic driver.
While most plays are on state and private lands, they want to expand drilling to federal domains, calling it a potential boon for jobs and federal revenues.
President Obama has so far resisted, saying sufficient drilling opportunities already exist.
And while proponents want more access, many Democrats and green groups are pushing back. While the industry says fracking is safe, opponents contend it pollutes groundwater and releases heat-trapping methane into the air.
President Barack Obama’s choice to lead the Energy Department pledged to increase use of natural gas Tuesday as a way to combat climate change even as the nation seeks to boost domestic energy production.p>
Ernest Moniz, a physics professor at the Massachusetts Institute of Technology, said “a stunning increase” in production of domestic natural gas in recent years was nothing less than a “revolution” that has led to reduced emissions of carbon dioxide and other gases that cause global warming.
The natural gas boom also has led to a dramatic expansion of manufacturing and job creation, Moniz told the Senate Energy Committee.
Even so, Moniz stopped short of endorsing widespread exports of natural gas, saying he wanted to study the issue further.
A recent study commissioned by the Energy Department concluded that exporting natural gas would benefit the U.S. economy even if it led to higher domestic prices for the fuel.
Sen. Ron Wyden, D-Ore., chairman of the Senate energy panel, called the DOE study flawed and said it relied on old data and unrealistic market assumptions.
Moniz said he is open to reviewing the study to ensure that officials have the best possible data before making any decisions.
“We certainly want to make sure that we are using data that is relevant to the decision at hand,” he said.
Many U.S. energy companies are hoping to take advantage of the natural gas boom by exporting liquefied natural gas to Europe and Asia, where prices are far higher. Nearly two dozen applications have been filed to export liquefied natural gas, or LNG, to countries that do not have free trade agreements with the United States.
Business groups support LNG exports as a way to create thousands of jobs and spur more U.S. production.
Consumer advocates and some manufacturers that use natural gas as a raw material or fuel source oppose exports, which they say could drive up domestic prices and increase manufacturing costs. Many environmental groups also oppose LNG exports because of fears that increased drilling could lead to environmental problems.
Natural gas results in fewer carbon emissions than other fossil fuels such as coal or oil. But environmental groups worry that drilling techniques such as hydraulic fracturing, or fracking, could harm drinking water supplies or cause other problems.
Alaska Sen. Lisa Murkowski, the panel’s senior Republican, pushed Moniz to support gas exports, which she said would boost her state’s economy.
Moniz said he supports exports as a general rule but would decide applications on a case by case basis, based on a “transparent, analytically based” review.
“I believe the Natural Gas Act kind of suggests that one should move forward with licenses unless there is a clear public-interest issue” against a project, Moniz said, adding that he would consider the cumulative impact of previously approved applications, which could affect the price and supply of natural gas in a particular region.
Moniz endorsed Obama’s “all of the above” approach to energy and said that if confirmed, he also would push for renewable energy such as wind and solar, along with coal and nuclear power.
“The president is an all-of-the above person and I am an all-of-the above person,” Moniz said.
Lawmakers from both parties appeared receptive to Moniz, who served as a DOE undersecretary in the Clinton administration. Moniz, 68, leads the MIT Energy Initiative, a research group that gets funding from BP, Chevron and other oil industry heavyweights for academic work aimed at reducing greenhouse gases blamed for global warming. He has advised Obama on numerous energy topics, including how to handle the country’s nuclear waste.
While Moniz encountered little opposition Tuesday, some environmental groups have protested his selection, citing his close industry ties at MIT and his support for fracking, in which large volumes of water, plus sand and chemicals, are injected underground to release trapped oil and gas.
Wenonah Hauter, executive director of the environmental group Food & Water Watch, ridiculed Moniz’s comments about a natural gas revolution.
“The only revolution taking place in regards to natural gas is the movement in the United States to reject it and those who advocate for it,” she said.
Russia, the world’s second largest oil producer after Saudi Arabia, has been in a declining state for some years now, its economy is weak, its population is shrinking, and its geopolitical power is not what it once was; add to all that the fact that its oil industry is quickly set to enter decline, and the future does not look too promising.
The FT has reported good news for the Kremlin. According to Leonid Fedun, the vice-president of Lukoil,‘Russia, the world’s second-largest oil producer after Saudi Arabia, will be able to maintain crude output of 10m barrels a day for years to come as output from western Siberia’s Bazhenov Shale offsets declines in the country’s mature oilfields.’
The Bazhenov fields are estimated to be five times larger than the Bakken shale play in the US, so Russia looks set to have a long and healthy future if they can be successfully developed. Russian companies don’t currently have the technology to set up horizontal drilling rigs sued in the US shale boom, and are therefore pushing the Kremlin to offer further tax breaks before any exploration is begun.
The US is pleased that Russia is set to begin extracting its shale reserves, as more oil on the world markets will help to keep prices low, reduce dependence on the Middle East, and increase security of global supplies. The Russians also tend to become more malleable politically when their finances are tight, which is likely to occur if the oil companies are granted their tax breaks.
MicroSeismic, Inc. (MicroSeismic) announced today the completion of their first FracStarTM microseismic monitoring program in Poland this past weekend. This is the tenth country in which MicroSeismic has monitored well stimulation activity.
MicroSeismic has installed its FracStar and BuriedArrayTM monitoring programs in all major shale plays in the United States as well as Canada, United Kingdom, Argentina, Mexico, Australia, China, India, Hungary, Turkey and now Poland.
The Polish government estimates the amount of shale gas reserves in Poland is between 346 billion cubic meters to 768 billion cubic meters. This establishes Poland as one of the largest holders of gas reserves in Europe. This substantial gas reserve will assist Poland and Europe to achieve strategic objectives in diversifying gas supply beyond Russia.
MicroSeismic installed the FracStar, which is able to cover a 12-40 square kilometer area, to provide microseismic monitoring, mapping and analysis for hydraulic fracturing of a customer’s exploration and field development program.
“This is truly a momentous year for MicroSeismic. Not only is this our ten year anniversary, we recently installed our 40th BuriedArray and now we are working in 10 countries,” said Peter Duncan, Ph.D., Founder and CEO of MicroSeismic. “MicroSeismic’s FracStar service is where we began and with the recent introduction of our patented PSET 4.0 processing technology, it remains the standard for microseismic detection services, worldwide.”
The FracStar geophones are spaced across 10-12 radial arms and can number in the thousands. Stations can be deployed using standard cabling technology or wirelessly to minimize field operation time and reduce cost.
This enables MicroSeismic to monitor primary, secondary and tertiary recovery activity, in a variety of reservoir conditions. FracStar is capable of imaging events to about -3.0 magnitude, about the energy release of a human heartbeat. MicroSeismic’s proprietary PSETTM 4.0 processing techniques are highly resilient to surface noise sources enabling MicroSeismic to consistently deliver high-accuracy event location in the horizontal and vertical directions over the entire monitored volume. Using real-time monitoring services, customers can adjust pumping rates and the type of proppant and fluids they are using during the fracturing activity to optimize the completion.
While no state came anywhere close to North Dakota for average personal income growth last year, Texas was a respectable second-place finisher, according to estimates released Wednesday by the U.S. Bureau of Economic Analysis.
North Dakota, which is enjoying an energy boom and, consequently, a building boom, led the nation in personal income growth in 2012, according to the bureau. Personal income is the before-tax income received by every resident from all sources, including wages, rents and transfer payments.
Average personal income in North Dakota increased by 12.4 percent in 2012, compared with 2011. That marks the fifth time in the past six years that North Dakota has recorded the nation’s fastest-growing personal income.
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In Texas, average personal income increased by 4.8 percent in 2012, making it the second-fastest in the U.S.
For Texas, the biggest contributor to earnings growth came from the construction industry, said David Lenze, an economist with the bureau in Washington, D.C. Construction income grew 11.6 percent in Texas during 2012, compared with 5.4 percent nationwide.
The U.S. average personal income increased by 3.5 percent in 2012, according to the bureau. That is slower than the average growth in 2011, when personal income nationwide grew by 5.2 percent.
Personal income data is not adjusted for inflation; consumer prices rose 1.8 percent in 2012, compared with 2.4 percent in 2011.
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The state with the slowest personal income growth? South Dakota. It recorded a loss of 0.2 percent in 2012, in large part because of the effect of last year’s drought on farm income. That same drought also hurt the economic fortunes of Nebraska, Kansas and Iowa, according to the bureau.
While North Dakota and Texas are growing the fastest in average personal income, they don’t rank as high when it comes to per-capita personal income.
In that category, which divides a state’s total personal income by its population, Connecticut is No. 1 at $58,908. Texas is No. 25 at $41,471, which is below the U.S. average of $42,693. Mississippi comes in last at $33,073.
When energy executives formed America’s Natural Gas Alliance four years ago, the goal was convincing politicians and the public to embrace the fossil fuel as a cleaner-burning, abundant alternative to oil and coal.
But now natural gas producers are a victim of their own success, and the challenge is growing demand, the incoming CEO of the industry’s leading trade group told FuelFix Wednesday.
A drilling boom in the Northeast, Arkansas and other parts of the country has led to a glut of natural gas, with supply outpacing domestic use of the fossil fuel that serves as both a power source and building block for other chemicals.
“We are looking at the opportunities for natural gas demand,” said Martin Durbin, who will take over as chief executive of America’s Natural Gas Alliance on May 1.“There’s an incredible opportunity at the state level to help on the demand side.”
State policies can promote the use of natural gas as a source of electricity, especially as utilities look for alternatives to coal and options for buttressing intermittent renewable power. Some state and local governments also are transitioning their fleets of buses, trucks and cars to natural gas-powered vehicles.
“The states provide an incredible advantage and opportunity for us to get the message out,” Durbin said, “and also work creatively with them on opportunities to better utilize the natural gas resources that we have.”
Meanwhile, the Energy Department is poised to decide whether to grant export licenses to more than a dozen companies that are seeking to sell natural gas to companies that don’t have free trade agreements with the United States. Natural gas producers are eager to get access to foreign markets where the fossil fuel sometimes fetches prices three to five times higher than in the U.S.
At the same time, other federal agencies are considering regulations to govern the hydraulic fracturing process that is key to unlocking natural gas (and oil) supplies nationwide. The Interior Department’s Bureau of Land Management is set to unveil a newly revised proposed rule governing fracturing on federal lands, with mandates for chemical disclosure and well design. The Environmental Protection Agency is conducting a multi-year study of the relationship between hydraulic fracturing and water.
As federal and state drilling regulations advance, the natural gas alliance’s member companies will have to continue to reach out to local communities and assure the public they can operate safely, Durbin said.
“We need to make sure we’re appropriately getting that message across and being very straight up with the communities where we are operating,” Durbin said.
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Durbin is no stranger to these issues, having spent more three years as the American Petroleum Institute’s top lobbyist, following a 16-year stint working for the chemical industry’s top trade group. He also is a veteran of Capitol Hill, where he worked for Democrats in the House and Senate.
Durbin is set to take ANGA’s helm from Regina Hopper, who stepped down as chief executive of the natural gas alliance in February, after one of the group’s founding members Chesapeake Energy CEO Aubrey McClendon announced his retirement. Greg Pensabene of Anadarko has been serving as the natural gas alliance’s interim CEO.
Apache Corp. CEO G. Steven Farris, ANGA’s chairman, said Durbin will bring “industry knowledge and experience, political acumen and deep background running successful advocacy campaigns” to the job.
At ANGA, Durbin will be tap into a stream of revenue from the some of the nation’s biggest natural gas producers, including such companies as Anadarko Petroleum Corp., Cabot Oil and Gas, Newfield, and Noble Energy. The trade group has devoted its dollars to television ads and other campaigns in recent years.
“You’ve got member companies who are very committed to the mission here and are willing to putting the resource in to getting the message out to make sure we’ve got the right policy at the federal level and the state level to take advantage of this opportunity,” Durbin said.
America’s Natural Gas Alliance spent some $5.7 million in lobbying over the past two years, according to public disclosure forms filed with the federal government and analyzed by the Center for Responsive Politics.
While Durbin suggested he didn’t anticipate major changes or a dramatic restructuring at the alliance, he said he sees a new “opportunity now to see what do we really need to be focused on, how can we enhance that focus and make sure that natural gas plays an even more prominent role in the economy.”
Oil giant ExxonMobil is making the case that the nonbinding Senate vote in support of the Keystone XL oil sands pipeline wasn’t simply political theater. An ExxonMobil executive took to the company’s blog Tuesday evening to highlight Democratic support for the pipeline in the 62-37 vote. Seventeen Democrats joined Republicans Friday in favor of TransCanada Corp.’s project. Pipeline backers are using the Democratic support to try and increase political pressure on the White House to support the pipeline, which would bring oil from Canadian oil sands projects to Gulf Coast refineries.“Critics were quick to note that the Senate’s action won’t green light the pipeline. ... Since authority for approving the pipeline rests with President Obama, they argue, the vote was symbolic.
Move along, nothing to see here,” writes Ken Cohen, ExxonMobil’s vice president of public and government affairs.
“Just because it was symbolic, however, doesn’t mean it’s not significant. Indeed, what makes Friday’s vote so important is the degree to which it represents strong and growing support for the project among elected Democrats — 17 of whom voted for the measure — as well as Republicans,” he wrote.
“Big Oil may have bought themselves this meaningless vote, but the decision on the Keystone XL tar sands pipeline remains where it’s been all along — with Secretary [of State] Kerry and President Obama,” said League of Conservation Voters President Gene Karpinski after the vote. Similarly, Natural Resources Defense Council Executive Director Peter Lehner said afterward that “their symbolic vote doesn’t change the law or the truth about this dangerous project,” and noted the final decision rests with President Obama. But Exxon’s Cohen noted that a vote on Keystone last year garnered 56 backers, while the addition of six Democratic supporters upped the tally on Friday. He writes that the growing support “seems to reflect a growing national consensus about the project,” and pointed to a Fox News poll that showed wide backing.
Last year, the Eagle Ford Shale had a $61 billion impact and supported 116,000 jobs across a 20-county swath of South Texas – a once sleepy region increasingly defined by an oil and gas boom.
The latest numbers from an ongoing University of Texas at San Antonio study continue to show a ballooning financial effect as the industry races to drill oil wells in the region.
The results of the study were released Tuesday at a meeting of the Eagle Ford Shale Caucus at the Texas Legislature, a group of South Texas lawmakers hoping to bring attention to the road, water, health and other infrastructure needs brought on by the influx of workers and truck traffic into the region.
America’s Natural Gas Alliance, an industry trade group, paid for the study.
It calculates both the direct economic impacts of oil and gas exploration in the region and the so-called indirect and “induced” economic activity.
The direct impact alone is enormous: the study counts more than 46,000 people directly employed thanks to the oil field last year.
The study paints a picture of a future South Texas that in many ways revolves around the oil and gas industry.
So far, more than 5,400 Eagle Ford wells have been permitted by the Texas Railroad Commission, but by 2022, the study expects more than 24,000 wells in the region.
Even as the field matures and fewer people work on drilling sites, there still will be thousands processing, transporting and refining that oil and gas, and everyone from attorneys to restaurant employees working along the way.
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