Got Gas?

A couple of years ago on a January afternoon, I saw my first gas well flare. It was a startling sight. I was driving on a highway a few miles north of the Montezuma Wildlife Refuge when I passed a frozen cornfield where a gas well drilling rig had been hard at work for a couple of weeks. A great blow torch of orange flame was roaring out of a pipe a hundred yards or so away from the road shoulder. I could hear the noise of the rushing, burning gas over the car radio and through my closed window. It was exciting, beautiful and a little bit scary. That flare, it turns out, was a harbinger of things to come ­– some of which are a little scary.

Chris Denton became aware of the natural gas potential of our region considerably earlier than I did. In 1999, this practicing attorney got interested in the subject because of its possible impacts on property owners and their land, and on just about everyone’s pocket book. Denton practices law in Elmira, but has roots in the Finger Lakes area through his family’s summer home in Cayuga County on the shores of Lake Ontario.

While he believes the great gas rush, already well underway in New York’s Catskills region, is inevitable, childhood visits to and boating on our local lakes has given him some awareness of the potential downside to “drill baby drill” policies. He now works with land owners, organizing them into bargaining groups to get a better deal from the energy companies.

Denton emphasized that a gas “lease,” such as those now being offered to residents throughout the Finger Lakes region, is a very long-term business proposition, not just for five or 10 years. “These are a transfer of rights, potentially for several generations,” he said. “They are a complex business transaction masquerading as a lottery ticket.”

Big Money
While people know these are not lottery tickets in the literal sense, they are piling onto the gravy train as fast as they can. A few weeks ago, a friend from northern Pennsylvania called me with news of a farmer who was offered a deal. “How much?” I asked. They said if it’s a really big pocket, royalties could be $300 a day, per acre, on a 160-acre farm – and possibly for years to come.

What’s staggering to realize is that payments like this are apparently pocket change to the energy companies. They’re coming to our area because of the potential wealth of a series of massive shale layers under New York State. In our area the much-publicized layer of Marcellus Shale and the deeper, underlying Utica Shale to the north are the potential reservoir for what might be enough gas to supply the entire U.S. for years.

These shale layers extend from West Virginia to Ohio and north into northern New York and Quebec, possibly containing over 500 trillion cubic feet of gas. If 10 percent of that were to be extracted by drilling, it could generate billions of dollars in revenues and thousands of jobs within the state.

The natural gas tied up within these dense shale layers of low porosity and permeability was of little interest to the energy companies until about five years ago when hydraulic fracturing, known in the trade as “fracking,” became a widespread industry practice. In this process, a shaft is drilled to 2,000 or 3,000 feet. Then the bit is turned sideways to move laterally through the shale.

Water and sand laced with an unappetizing and “proprietary” stew of chemicals which, in the past in other regions, included dilute acids and/or other compounds such as diesel fuel is then pumped under high pressure into the shaft to fracture the gas. The sand grains help “prop” open the cracks in the shale, allowing the gas to escape.

The drilling water, now polluted with a mix of chemicals and brine from underground salt deposits, is then disposed of. This used “drilling fluid,” as the industry terms the water, is perhaps the biggest (though hardly the only) environmental concern associated with shale gas wells.

More Issues and Concerns
One issue is the impact of gas wells and fracking fluids on water in aquifers relatively near the surface. Contaminated water from the well itself, which can contain salts, and in some areas, low levels of radioactivity along with liquid from the fracking process, is often stored in ponds nearby. Though these have plastic liners, they have been known to leak when liners fail or runoff from rain causes them to overflow.

Geologist Don Zaengle says most incidents of groundwater contamination in New York and Pennsylvania in the past have been from these surface pits. Gas well casings have also failed before, allowing gas to enter groundwater. Last December, a house in Bainbridge, Ohio, in the northeastern corner of the state, exploded after gas from a nearby well blew out a faulty concrete barrier and then leaked into groundwater. The home’s well, located in the basement, then released the odorless gas until it built up enough to ignite. Several dozen neighboring wells were also polluted.

In its online report of the incident, Ohio’s regulatory agency strived to express that this was the first documented case of well water contamination in a state where 22,000 wells have been drilled over the years. However, the instance involved a deep well that had undergone the hydraulic fracturing process. It was also in a residential area in the aptly-named Chagrin Valley area. With only 19 inspectors to cover the whole state, one wonders if other undocumented aquifer contaminations in less-inhabited areas might also have occurred.

Proponents of natural gas drilling like to point out that the amount of chemical additives to the water used in fracking is small – only a fraction of the total volume. But as research on the Great Lakes, the Baltic Sea, and a number of other places has demonstrated, very small amounts of persistent pollutants can have sub-lethal but important impacts on wildlife and humans.

Recent research has been conducted on the number of compounds that, in very low concentrations, can disrupt the vital endocrine system hormones essential to healthy immune systems and reproduction. When groundwater is contaminated, it usually stays that way for a long time. And cleanup of polluted groundwater is a costly endeavor. Prevention is vastly preferable to remediation.

It’s the possibility of such contamination that has mobilized environmental groups in the Catskill area, the source of drinking water for 8 million New York City residents, as well as other groups in southern New York and Pennsylvania. Last summer, Governor Patterson signed a bill that would allow shale gas drilling and fracturing in New York. State officials were quick to note this could bring in $1 billion in annual taxes. However, no drilling permits for horizontal wells are being issued while the state goes through an updated environmental impact assessment of the process.

Environmental and land owner groups in the Southern Tier and Catskills area have pointed out that much of the regulation of the gas business in New York is through the permit process, rather than through on-site inspections. At this time, the drilling companies don’t have to disclose what chemicals they are injecting into the ground in their proprietary recipes. A number of people have called for that to change, arguing that the Depart­ment of Environmental Conservation (DEC) should require them to reveal the mixes so industry and the public alike know what they’re dealing with.

Safety Regulations
Safeguards to protect water do exist. New York requires several layers of well casing and shaft protection in the near-surface section of the well along with a barrier of cement. This, in theory at least, prevents gas and brine from polluting shallower groundwaters that feed streams, springs and drinking water wells.

On-site inspections by the regulatory agency, the New York DEC, may also occur. But as Zaengle notes, right now New York’s inspection program, like Ohio’s, is severely undermanned for the coming gas rush. He cites a landowner group’s report that states New York has only four people to cover the whole state, saying, “Once this thing really ramps up, there will be even fewer inspections.”

The Finger Lakes shale layers are less porous than those out West, requiring different chemicals, and any nasty ones that are used in the fracking process here are much less likely to move long distances, as has happened in Colorado and Wyoming. And drilling fluids can be reclaimed and cleaned.

Unfortunately, at this time in New York State, the few companies that have the ability to treat and purify polluted water can’t handle the volumes that will be produced by even one deep shale gas well. Though Zaengle notes, “I’m confident companies will come forward to do the work,” there is as yet no practical way to clean up contaminated drilling water in the Finger Lakes region.

A technology exists that could both greatly reduce demand for water and the amount of polluted water produced. Closed loop drilling has been tested on 40 wells in New Mexico and eliminates the open pond used for waste water and solids storage. It captures most of the contaminants right at the wellhead through filtering and use of centrifuges and chemicals to aggregate the solids, salts and chemicals.

The cleaned water is then stored in tanks onsite and reused in other drilling operations while the dried solids can be either disposed of or used onsite as part of the well pad and/or access road bed. Such drilling practices may initially cost more and reduce the bottom line, but in the long run could save companies money. After all, how much is a reliable source of pure drinking water worth? As the bumper sticker for the Catskill Mountain Keeper group reads, “We can’t drink natural gas.”

As of December 2008, the global credit crunch had slowed the gas rush, but no one expects the energy companies to abandon Upstate’s shale gas. Landowners in the Finger Lakes region and throughout the state will continue to be approached by “landmen,” people working with energy companies to buy up mineral rights.

Before signing away such property rights for generations to come, owners should educate themselves about the potential downside. You could end up with a parking lot, a large, noisy compressor, or some other permanent industrial facility on your property – and with no further compensation for it. Backing out of these deals after you sign is not an option. These giant corporations have massive legal budgets. Organized land owner groups can educate themselves as well as strike better deals with the gas companies and the lawyers.

A few months before I talked to him, Chris Denton was quoted in a downstate news article as saying, “This is happening, it’s unstoppable, and the question is whether we do it in a way that makes sense or a way that’s irrational and irresponsible.”
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Find out more
For more information, visit the website of the regulatory agency of New York’s DEC: www.dec.ny.gov/energy/1601.html

For information on noise, habitat destruction, road damage and other environmental issues associated with drilling, visit www.catskillmountainkeeper.org

“Oil and Gas At Your Door?” A guidebook for landowners is available for download at www.earthworksaction.org. To receive this by mail, call 970-259-3353.

The New York Attorney General’s office maintains a list of energy companies that have had complaints of shady deals, intimidation or other actions lodged. Call 800-771-7755, or visit www.oag.state.ny.us


by Susan Peterson Gateley