EPA Nipping at the Heels of Shale Gas Producers

Ken Silverstein | Apr 23, 2012

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Natural gas is winning the energy race but the competition is on its heels. While coal, nuclear and green fuels would like to catch it, its chief rival appears to be the environmental groups that want it to invest in safer drilling technologies.

At issue are the production methods used to extract shale gas, which is located a mile beneath the earth’s surface. Concerns exist on a number of fronts that include the release of methane gases, which are shorter-lived than that of carbon dioxide but that are considered to be much more potent. As such, the U.S. Environmental Protection Agency has issued new rules to minimize such leaks.

Some shale gas producers say it is better to acquiesce than to suffer a public backlash, especially if the methane could be captured and later sold. Others, though, are more hesitant. They are concerned about the cost of compliance but will nonetheless review meticulously EPA’s “complicated” rule.

EPA will take public comment for 60 days but after the regs are enacted, natural gas drillers will have three years to comply. Producers could burn, or flare, their methane releases, although they could also buy new equipment that would capture the leaks. Those gases could then be resold in the market. 

A Cornell University study last year concluded that total greenhouse gases over 20 years as a result of exploring for shale are at least 20 percent greater -- possibly as much as double -- when compared to those of coal. That’s because natural gas is composed mostly of methane, which may have the ability to dissipate but is still capable of trapping more heat than carbon dioxide.

“By ensuring the capture of gases that were previously released to pollute our air and threaten our climate, these updated standards will not only protect our health but also lead to more product for fuel suppliers to bring to market,” says EPA Administrator Lisa Jackson.

In a separate move, the White House issued an executive order that streamlines the federal review process when it comes to oversight of natural gas activities. Specifically, President Obama says that his administration supports “safe and responsible unconventional domestic natural gas development” but that air and water quality would not be sacrificed in a shale-dominated energy economy. 

Greater Transparency

Consider that shale gas in 2008 comprised about 11 percent of all natural gas production. But by 2010, that number jumped to 27 percent and by 2015, it will be 43 percent. That’s according to IHS Global Insight, which says that by 2035 shale will amount to 60 percent of all natural gas production.

EPA says that such prominence requires more of its attention. Specifically, it wants to cut volatile organic compounds, or smog levels, by 25 percent. But the EPA says that would be done by using proven technologies that can capture natural gas that currently escapes into the air -- gas that would be made available for sale. It goes on to say that this would result in an additional $30 million annually in sales for the natural gas industry -- more than enough to compensate the developers.

A high profile advisory board to the U.S. Department of Energy reported last fall that shale gas development can live up to its expectations, both economically and environmentally. It said that greater openness would give regulators more accurate and complete information. The public, meantime, would be assured that it is seeing continuous and measured improvement in the drilling methods being used.

“One of the starting points is the need for much more complete measurement of water quality, air quality, and specifically methane,” says Daniel Yergin, who was on the advisory board, in testimony. “Many of the recommendations focus on best practices and technical innovation. They also emphasize the importance of community engagement and the need for disclosure and transparency. They recognize the central role of state regulation in this arena.”

Several environmental groups are unconvinced. They are pointing to an examination done in February by the National Oceanic and Atmospheric Administration. It is showing that air samples in Colorado that are near fracking wells contained twice the levels of methane that EPA had expected, or about a 4 percent leakage rate. The Natural Resources Defense Council insists that fracking must be postponed until drillers can demonstrate that it is always safely done. 

The energy race is not yet decided. But if shale gas developers want to maintain their current advantage, they will need to make key investments in the tools that can capture methane leaks. Otherwise, EPA will come down hard and the environmentalists will overtake them.


EnergyBiz Insider is the Winner of the 2011 Online Column category awarded by Media Industry News, MIN. Ken Silverstein has also been named one of the Top Economics Journalists by Wall Street Economists.

Twitter: @Ken_Silverstein

energybizinsider@energycentral.com


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Cornell Study

I am writing concerning Ken Silverstein's April 23 energybiz.com article titled "EPA Nipping at the Heels of Shale Gas Producers."
http://www.energybiz.com/article/12/04/epa-nipping-heels-shale-gas-producers&utm_medium=eNL&utm_campaign=EB_DAILY2&utm_term=Original-Magazine 
In the article, Ken refers to a "Cornell University study last year [that] concluded that total greenhouse gases over 20 years as a result of exploring for shale are at least 20 percent greater -- possibly as much as double -- when compared to those of coal." 

This 2011 study, by Howarth, Ingraffea and Santoro, and published in the journal Climate Change, has subsequently been challenged, if not fully discredited, by an analysis performed by Cathles, Brown, Hunter (three Cornell University professors) and Taam.  A copy of this response, published in the same journal on January 3 2012, is attached. 

In their commentary Cathles, Brown, Hunter and Taam point out a number of serious flaws in both the analysis and presentation of Howarth, Ingraffea and Santoro, which can be summarized as:

1) Unrealistically high estimates of fugitive emissions associated with unconventional gas
production based on a cryptic presentation of relatively few and poor primary sources
 
2) A dismissive discussion of new technologies now in use to reduce such emissions
 
3) An unsupported, and [they] feel inappropriate, choice of the time interval for estimating
greenhouse impacts of fugitive methane
 
4) Comparison of gas to coal on a basis (heat rather than electricity) which is basically
irrelevant to evaluation of the relative greenhouse effects of these two options.
 
Cathles, Brown, Hunter and Taam conclude as follows:
 
The data clearly shows that substituting natural gas for coal will have a substantial
greenhouse benefit under almost any set of reasonable assumptions. Methane emissions        
must be five times larger than they currently appear to be before gas substitution for coal
becomes detrimental from a global warming perspective on any time scale. The advantage
of natural gas applies whether it comes from a shale gas well or a conventional gas well.
Scientifically the prescription for reducing green house emissions is clear: substitute gas
for coal while minimizing methane emissions using proven and available technology, and
then move toward low carbon energy sources as quickly as technically and economically
feasible.
 
In the interest of fairness, Ken Silverstein should become familiar with the work of Cathles, Brown, Hunter and Taam and factor it into his reporting the full body of work associated with Cornell University.   
How studies are funded seems to be a major consideration in assessing the motives of authors of articles.  I contacted Drs. Larry Cathles and Larry Brown and they indicated that their work was not funded by any source.  They felt that Howarth's paper was so one sided that it needed to be countered, and preferably countered by workers at Cornell.  I do not know how the work of Howarth and others was funded.  You would need to ask them.    
Thank you.
Jim

A Balanced and Responsible Approach

Outside of complications related to seismic activity (which requires further research), everything else involved in fracking can be done safely and economically.  This really comes down to corporate greed the propensity toward shortsighted profiteering.

The people need to step up and exert their authority. We have a responsibility to ourselves, our society and our future.  We elect officials who we need to hold responsible for representing our interests rather than their own.

You have to spend money to make money; you have to invest well and wisely to make reliable returns. There is no reason not to hold our officials and these corporations to that standard. That is the only option that doesn't undo us later down the line- or more likely, sooner than we would like to believe.

We have no excuse to be ignorant or wasteful and we will have no one to blame but ourselves if we pave the road to our own ruin. So step up and don't be laissez faire about your stake in the world.  Have an educated opinion, take responsibility as a conscientious member of your community and don't condone complacency.

Demonstrated Technology for Proposed Regulations

Trapping of flowback volatile compounds employs demonstrated technology that industry has been using. Three year implementation schedule would allow for manufacture and purchase of equipment. But this may not end the regulation of fracking.

Environmental Groups, e.g. Sierra Club, have a practice of suing USEPA over regulations which translates into more stringent regulations. These groups may wait until after presidential election to conduct ‘business as usual’. For now, Shale Gas represents jobs and economic growth so the proposed regulations are relatively rational.

R,W, Goodwin West Palm Beach FL

Guys ... any drill site ALWAYS has ...

several BIG diesel sets running to power the operations.

DIESELS can run very well on a mix of fuel oil & natural gas/methane.

The injected diesel fuel is throttled back to idle flow while the intake air is enriched with natgas until optimal power output is reached.

So, we should capture the early natgas leakage and feed it into a compressor for storage until it can be burned off to power the site.

 

All of these Regulations from

All of these Regulations from Shale-Gas or Coal are all still very daunting to any sorts of businesses. The cost of compliance is enough to shut any business down or at least so its growth (http://bit.ly/zgsTLu). In addition since regulations always change, there's never enough time to get accustomed to the rules that they just put in. Whether it's shale-gas or coal regulations we still need to work on getting our policies more compliant with our practices and vice versa to make a real recovery during this downturn.

Methane leaks are just one of the problems with Fracking!

1.5 million gallons of water per well.

10,000 gallons of fracking chemicals per well.

The energy to deliver this water and chemicals to the well.

Each well requires thousands of gallons of diesel fuel to produce the pressure that fractures the rock formations.

The fact that there is a documented increase in seismic activities near where wells are fracked. 

The fact that as much as 80% of the fracking fluid is not reclaimed and eventually will migrate to our drinking water.

The fact that natural gas in general only has an EROEI (energy returned on energy invested) facot of between 2 and 4 and that is before all of the additional energy inputs that fracking requires.

All of these are reasons that fracking shouldn't be allowed!  Then when you add in the fact that 4% of the gas collected leaks out in the form of methane that is 20 times worse than carbon in terms of being a greenhouse gas, but for greed, it's a no brainer!

To the commenter who complained that some people think that we can provide all of our power needs via wind and solar, well, if you include biomass, wave energy and conservation and efficeincy, I'd have to agree with those people!  It will take a while, even if we started in earnest today, but we could do it.

Which is a good thing because we're gong to have to do it eventually!  Even if we ignore the negative consequences of remainging addicted to fossil fuels, eventually they are going to run out in any kind of economicially available way.  It might be 20, 40 or even 100 years from now, but they are going to run out!

By accepting reality as it is and not as we might want it to be, we can make the switch and not endanger our very survival as a species!  Alright, that might have been a bit over the top, but even if we do survive as a species, not making the switch is going to cost us dearly as a society!

 

Bob "The Clean Energy Guy" Mitchell

EPA will destroy the Economy

The EPA and environmental organizations won't stop trying to destroy fossil and nuclear energy. They actually believe we can survive on wind and solar energy. They will eventually guarantee that the U.S. will not be able to compete in the world economy!

The Administration's intent is to reduce US carbon emissions...

by whatever means are both necessary and sufficient. Cap & trade+ failed; carbon tax is a "non-starter"; EPA regulation is the next "means" to be tried.

I would argue that the Administration sees, not a need for balance, but a need for stealth and obscurity.

shale

I think the administration does not want to do away with shale. it is coal's replacement. I also think the rules are meant to increase shale's life. Shale may not see it that way but the rules give it a chance to capture its methane and to resell it. These groups need to work with the EPA and not fight it at every turn like coal.

Balance & Restraint

There has to be some sort of balance struck or I can see natural gas going the way of coal. The EPA has to exercise restraint when setting environmental regulations.