© 2010 Frederick Doot
A war is being waged. Just over 100 miles from New York City, a war is being waged, and its outcome could affect over 15 million people, including the entire population of NYC. What is the war over? Fracking.
Fracking, or hydraulic fracturing, is a drilling technique that involves injecting the earth with millions of gallons of water, chemicals and sand to release natural gas within shale deposits. In this case, it means drilling to an average depth of 8,500 feet into aquifers within the Delaware River Water Basin, which supplies millions of people with drinking water. Vast deposits of natural gas are believed to exist within the Marcellus Shale, an area deep within the earth made of sedimentary rock spanning from the finger lakes of northwestern New York, out to eastern Ohio and down through West Virginia and Maryland, ending at the western tip of Virginia. Gas companies are eager to tap into this resource for natural gas, regardless of its effects.
Land leases are being signed throughout rural poverty-ridden areas in upstate New York to allow gas companies to begin hydraulic fracturing. By dangling up to $3500 per acre to local residents, as well as offering royalties for extracted gas, the deals are hard to pass up. And many have committed without considering the hidden costs and consequences. Both on a local and large scale, the consequences can be severe.
In northeastern Pennsylvania, where fracking has already begun, groundwater has been contaminated with methane due to hydraulic fracturing, rendering well water undrinkable. In Texas, nitrogen oxide and other Volatile Organic Compounds (VOCs) emitted from wells are causing dangerous surface smog, forcing many residents to move. In Colorado and Wyoming, the contamination of wells is so severe, holding a match to the end of ones' water faucet causes a violent flame. Within the Marcellus Shale region, more than ten cases of fracking fluid spills have occurred. There have been five explosions between 2006 and 2010 contaminating both ground and surface water; over $3.5 million dollars in fines assessed to companies due to these violations. Yet despite these obvious, inherent risks, the path has been cleared so that gas companies have all the incentive they need to aggressively pursue natural gas extraction in the northeast.
In 2005, President George Bush signed into law the Energy Policy Act (EPA) of 2005. The bill, nicknamed, “The Dick Cheney Lobbyist Energy Bill”, offers significant tax breaks to gas companies and exempts them from many regulations of the Environmental Protection Agency and the Clean Water Act of 1977. Drilling in New York is a no-brainer for gas companies thanks to this Energy Policy Act. Consider the following:
~ The EPA allows independent companies to deduct fifteen percent of their sales revenue if the average daily production falls below a certain minimum – meaning gas companies get subsidies even if their wells do not extract any gas and no royalties are paid.
~ Legislation reclassified oil and gas as a manufactured good, allowing companies to claim $3.5 billion dollars of additional tax deductions.
~ Taxpayers subsidize 70-100% of the drilling costs (including wages, equipment, supplies, site preparation, etc.) due to the “intangible drilling costs” loophole, costing taxpayers another $3.5 billion dollars.
~ The EPA allows companies to deduct the cost of natural gas distribution over 15 years depreciated time, giving them almost free distribution. In addition, the EPA allows companies to deduct the cost of natural gas gathering lines over 7 years depreciation. Again, almost free distribution.
It doesn't end there. Each well uses approximately 80,000 pounds of chemicals (in addition to 2 million gallons of clean water per well.) Over 70% of the fluid used in every well remains underground and is not biodegradable. Researchers suspect that sixty five of these compounds are hazardous to human health. Furthermore, thanks to a loophole within the EPA, companies are not required to provide the ingredients of the fracking fluid, as the fluid is considered proprietary. And it's no surprise that one of the largest producers and profiteers from production and sale of the fracking fluid is none other than Halliburton.
Natural gas has been considered a “green” alternative as the United States tries to satisfy its energy needs due to its clean-burning nature. And with enough natural gas within the Marcellus Shale to provide the US with up to10 years of energy, it is a tempting option. But is it worth the expense? Local coalitions are urging authorities and politicians to force the Environmental Protection Agency to conduct further research on fracking and its effects on the region before drilling begins. Gas companies are stressing the need to drill today. The war wages on.