This is the first of a two-part series on fracking. In the second story, the Indy will explore the problems landowners can encounter when signing lease agreements with drilling companies and brokers.

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Drill your legislators on fracking

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A Duke study released this week linking high levels of methane in drinking water wells to fracking activities

Duke scientists’ recommendations on next steps to take to determine impacts of methane gas on public health

Congressional report on fracking chemicals

Pennsylvania environmental group report on effects of fracking in that state

A Powerpoint presentation by Bill Holman, state policy director for Duke University’s Nicholas Institute for Environmental Policy Solutions

A presentation by the N.C. Geological Survey about potential shale gas resources in the state

SB 709, the Energy Jobs Act that passed the Senate and is headed to the House

HB 242, the House version of the fracking study bill

SB 615, the Senate version of the fracking study bill

In Exxon Mobil’s recent TV ad campaign, a camera tracks across a scenic landscape as a company geologist reassures us that the key to our national energy security lies just below our feet. “Technology has made it possible to safely unlock this clean and green natural gas,” he says.

What you won’t hear in the Exxon ad is the name of this technology: fracking. The controversial drilling method has become the new F-word after being linked to environmental calamities in at least a half dozen states.

These calamities are well documented and difficult to dispute. In Pennsylvania, Ohio and New York, explosive methane gas and hazardous fluids from fracking operations have contaminated drinking water, private wells and rivers. In several states, drilling companies have irresponsibly disposed of tainted wastewater, spilling toxic chemicals into streams and groundwater and sending radioactive wastewater to city sewage treatment plants that were unequipped to filter those kinds of materials.

Fracking is illegal in North Carolinafor nowand we would be hard-pressed to look for good examples of regulation in other states, where laws and enforcement of fracking are piecemeal at best.

“No state is a model that shows this can be done safely,” says Molly Diggins, state director of the N.C. chapter of the Sierra Club. “In fact, it’s quite the opposite. There’s been one disaster after another.”

There is little guidance from the federal government, which six years ago agreed to exempt fracking fluidwhich can contain not only water and salts but cancer-causing chemicalsfrom many key federal clean-water regulations.

Yet given the dangers and unknowns, some North Carolina lawmakers are determined to legalize fracking in our state, especially in areas near the Triangle. Many of these legislators have cribbed their talking points from industry, claiming fracking can be done safely if it’s well regulateda big if. These proponents of fracking justify the practice by contending natural gas production will generate state revenue in royalties and taxes and help ensure our energy independence.

But several North Carolina environmental groups and scientists are skeptical that, given the power of the energy industry and the Legislature’s proposed 23 percent cut to DENR’s budget, the state can adequately regulate fracking to protect human health and the environment

And unlike Texas, which has an extensive history of oil and gas drilling and mineral rights laws (although the agency in charge, the Railroad Commission, is lodged deeply in the energy industry’s pocket), North Carolina has little if any expertise in permitting and regulating fracking.

“Whether North Carolina wants to frack natural gas is unresolved. North Carolina needs to ask itself the question: Do we want to run the risks in favor of any benefits?” said Sam Pearsall, a senior scientist with the Environmental Defense Fund. “I don’t see those questions answered. Properly enforced we could go ahead, but I can see how we might decide the risks are too great. Do we want that part of the world crisscrossed with roads and pads and hundreds of tankers coming in and out?”

About 200 million years ago, dinosaurs roamed the land that is now traversed by N.C. 751 and U.S. Highways 1 and 421 in the Triangle. The supercontinents, also known as pangea, began to separate, and in this part of the world, formed the Atlantic Ocean. Portions of what would become North Carolina split like slices of cake being pulled apart. The rift left valleys that over time filled with plants, dirt and other organic matter.

Millions of years of heat and pressure baked the sediment into seams of fossil fuels, including coal, oil and natural gas. These fuels are thought to be in the Triassic Basin, a subterranean swath that cuts from southwestern Granville County through Durham and parts of Wake, Chatham, Lee and Moore counties.

More than a half-mile below the earth’s surface, particularly in southern Chatham and Lee counties near the Deep River, geologists and energy companies believe there is an untapped resource of shale gas. There are larger shale gas fields in Pennsylvania, New York, Texas and Wyoming; the one in North Carolina “is not a giant field, but it’s a field,” Chief of the N.C. Geological Survey Ken Taylor told the House Environment Committee.

Until the last decade, shale gas had remained largely unexplored in the U.S. because the technology had not been developed to reach gas that was buried so deeply and trapped in such compact rock. But fracking and horizontal drilling solved that problem. Fracking forcefully injects water and other chemicals into rock to fracture it and release the trapped gas that is then captured at the surface.

The combined effect of technological advances with the energy industry’s influence and the political push to develop domestic fossil fuels all served to make fracking the supposed panacea for the nation’s energy woes. In 2009, 63 billion cubic meters of gas was produced from deep shale formations, according to the U.S. Energy Information Administration. In 2010, production doubled to 138 billion cubic meters. In the next 25 years, shale gas is expected to amount to nearly half of the projected gas production in the U.S.

In North Carolina, fracking hasn’t occurred because, in part, horizontal drilling is illegal. The state’s underground injection program prohibits injecting wastewater or pollutants that could contaminate drinking water into an aquifer. These rules apply to fracking because the flowbackchemicals, salts, sands and other wastewater that is belched with the gas (think of it as acid reflux in a well)is often reinjected into aquifers deep within the ground.

But that could soon change. With Republicans in charge of the General Assembly, the state’s energy focus is shifting from renewables and energy efficiency back to fossil fuels, including offshore drilling and fracking for natural gas.

“It’s my intention to move ahead with this drilling as long as it’s safe and sound,” said Mitch Gillespie, a Republican from Burke County and a primary sponsor of House Bill 242, which directs the N.C. Department of Natural Resources (DENR) to study fracking (see “Drill your legislators on fracking“.)

Vik Rao, a former vice president at Halliburton and a longtime Sierra Club member, was among the main attractions at last month’s Sustainable Energy Conference at N.C. State University.

Rao is now the executive director of the Research Triangle Energy Consortium, a partnership among Duke University, UNC, N.C. State and the nonprofit RTI, a research institute.

Rao supports fracking, and at the conference, he addressed the inevitable questions about the method’s environmental hazards. His solutions to these problems, while earnest and theoretically possible, would require us to trust regulators and the energy companies.

The first environmental hazard posed by fracking is water quantity. Fracking requires enormous amounts of water3 million to 5 million gallons per wellto blast into the rock.

North Carolina doesn’t regulate large water withdrawals, leaving the state’s waterways vulnerable especially during droughts. The 2007 drought drained many of the state’s waterwaysthat summer the bed of Falls Lake was dryand also depleted shallow groundwater.

In southern Chatham and Lee counties, fracking could harm the Deep River and its watershed. “It’s already a dry basin with almost no groundwater,” said Pearsall of the Environmental Defense Fund. “And the surface streams don’t carry a lot of water. It’s hard to say if there is enough water to frack.”

About a third of the amount of water that is initially injected into the well returns as flowback, or discharge. It is often dozens of times saltier than the original fluid and contains fracking chemicals. That means it should not be dumped into lakes and rivers or pumped into shallow groundwater aquifers.

Rao’s answer to the water withdrawal problem is to reuse the discharge, although that would still require some new water to mix with the old. Another possible solution is to use saltwater from saline aquifers, eliminating the need for fresh water. Fracking chemicals would need to be tinkered with to work with saltwater, but it’s possible.

“The industry took the easy way out and used fresh water because it’s free,” Rao said.

Or drilling operators could inject the discharge into deep aquiferscommonly done in Texasthat have no known use. (That’s not to say, though, the aquifers will never be used.)

Excess discharge presents another problem for drilling companies: disposing of it. In North Carolina, it is illegal to put those materials back in the ground, although in Texas wells are designated for just that purposeand they can fail. (See this story about how a faulty disposal well in East Texas polluted a neighborhood’s drinking water supply.)

In Pennsylvania, some operators have shipped the discharge to wastewater treatment plants. But these plants can’t handle or even detect many of the types of chemicals and salts and, in some cases, naturally occurring radioactivity. In Pittsburgh, radioactive material from discharge passed through a city treatment plant and wound up in the drinking water supply.

“This is not the kind of wastewater that municipal treatment plants are designed to treat,” DENR Assistant Secretary for the Environment Robin Smith told legislators.

Some companies store the flowback in tanks and recycle it, although that could intensify the levels of contamination as the fluid is reused. Other operators discharge it in lined lagoons and let it evaporate, although that method can produce air toxins and hazardous residue. The liners can also break. “At some point, you’re running out of options,” Pearsall said.

Water can also become contaminated by methane, which comprises 99 percent of natural gas. High levels of methane have been found in drinking water wells near fracking sites in Pennsylvania and New York. The levels have been so high, as documented in the anti-fracking documentary Gasland, that some residents can ignite water running from their kitchen faucet.

A peer-reviewed study released Monday by four Duke University scientists for the first time authoritatively linked fracking and shale gas to methane levels in drinking water wells, a connection the industry energy had long denied.

The scientists surveyed 60 drinking water wells in Pennsylvania and New York and found that wells near gas extraction sites had, on average, 17 times higher levels of methane gas than wells that weren’t.

“Essentially, the closer you are to a natural gas well, the more likely you are to have methane in your drinking water well,” said Rob Jackson, one of the scientists involved in the study. “What surprised me was the consistency of the results.”

Scientists analyzed the chemical and radiological makeup of the methane found in the wells and concluded it was similar to the methane formed under heat and pressure in deep shale where the fracking was occuring. The methane found in the wells, however, was different from the type formed by bacteria and is generally found in shallow wells.

The immediate danger of methane in drinking water is that it can build up in the well or in a home and explode. Last year, a well in Pennsylvania did just that, as did a home in 2007 in Ohio. In both cases, state investigators concluded methane from nearby extraction sites contributed to the explosions.

The health effects of drinking water containing methane are unknown, although residents whose wells are contaminated have complained of headaches, rashes and other ailments. The federal government does not regulate methane in drinking water.

In a subsequent paper, Jackson and his colleagues listed several recommendations. Those included an independent medical panel review of the health effects of inhaling methane and drinking water that contains the gas. The team also recommended that government officials sample drinking water and groundwater before and after drilling.

Rao blames “a bad cement job, bad well casings” for methane leaks. “This can be completely prevented,” he told the Indy. However, Rao acknowledged that if the Duke study holds up to further review, then “unfortuantely for the nation and the industry,” something is at work beyond bad cement.

A greenhouse gas, methane also pollutes the airit’s also emitted from landfills and cattle farmsand contributes to global warming more than carbon dioxide. A Cornell University study found that over the lifetime of a fracking well, 3.6 percent to nearly 8 percent of the gas will escape into the air. Pollution from methane and fracking activities have created ozone levels near one town in Wyoming that are higher than in Los Angeles, according to a New York Times report.

While Duke scientists’ methane findings were startling, they did not discover evidence of fracking fluid or radioactivity in drinking water wells. However, hundreds of thousands of gallons of fluids have spilled into Pennsylvania rivers and streams, harming ecosystems and water supplies.

These cautionary tales gave state Rep. Kelly Alexander, D-Mecklenburg, pause. He was among the members of the House Environment Committee to address the water and disposal problems. “I’d like to urge a very serious look at the use of water and groundwater contamination issues,” he said. “That’s something that is extremely serious and we should be careful about it.”

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Rao told an audience of about 1,000 people at the Sustainable Energy Conference that natural gas has become a crucial fuel source. When our thirst for oil outstrips the supply, somewhere around 2020, “that will be something to really worry about,” Rao said. Forms of natural gas will become the dominant fuel for cars.

This is why he supports fracking. But Rao also favors strong penalties for violators, including those responsible for fracking accidents that have plagued other states.

“We need to modify laws to allow horizontal drilling and fracking and address the environmental issues from the outset,” Rao said.

“Throw the book at evildoers,” he later told the Indy. “The only thing they understand is economics. We need to have strong punishment.”

But that’s a tall order. Shoddy drilling practices are common, and even minimal regulations have failed to rein in many energy companies’ practices. And North Carolina has none of those laws and no good examples. States that recently allowed fracking seem almost naïve in their anemic environmental laws and enforcement. And in states with significant drilling historiesTexas, Louisiana and Alaskaregulations favor the energy companies.

“We have a potentially valuable resource,” DENR’s Robin Smith told the House Environment Committee. “But we don’t have the statutory or regulatory structure to deal with it.”

It’s also uncertain how the state’s permitting and enforcement teams would handle the additional workload. Jim Simons, a state geologist and director of DENR’s land resources division, said he believes the agencyeven facing cuts to nearly a quarter of its budgetcan be adequately staffed to do the job. Although money would be needed to jump-start the program, permitting, for example, could be self-supported through fees assessed on drilling companies operating in the state.

“We can look at other states and see what we can learn from them,” Simons said. “Industry can provide some input. We have an opportunity to do it right, but nothing is foolproof if you don’t follow the rules.”

That’s precisely why some environmental groups and legislators are skeptical that DENR can aggressively oversee drilling practices. “If the agency has a short period of time to decide on a permit, it won’t get the necessary review,” said Geoff Gisler, staff attorney with the Southern Environmental Law Center. “You see proponents of fracking and offshore drilling putting trust in government agencies, but also compressing the time those agencies have to act and reducing their manpower.”

Hope Taylor, executive director of Clean Water for North Carolina, is unconvinced a fee-based program would ultimately protect the environment. “Any program that doesn’t have independent or federal match funding would be viewed by the industry as providing a service for them,” said Taylor, who serves on the National Drinking Water Advisory Council, which makes recommendations to the EPA.

“Legislators who support minimal regulation aren’t going to propose adequate fees,” she added. “There is still a tremendous amount of wishful thinking that we’ll have true independent oversight of these operations.”

In an email to her constituents, state Rep. Pricey Harrison, D-Guilford, bemoaned the Legislature’s cuts to DENR. “Vital programs are shifted to other departments in an attempt to weaken regulatory oversight,” she wrote. “All non-federally matched positions in the regional offices are eliminated, which will be problematic for protecting our air and our water but also for those seeking permits to engage in construction and manufacturing.”

Federal funding for state enforcement programs is decreasing, while federal law continues to court energy companies, particularly involving fracking. The 2005 Energy Policy Act, largely crafted by then-Vice President Dick Cheneya former Halliburton higher-upand industry insiders, exempts fracking fluids from the Clean Water Act and the Safe Drinking Water Act. Nor do companies have to disclose the contents of their fracking chemicals, because they claim to do so would violate trade secrets.

In hindsight, a former EPA official during the George W. Bush administration believes the fracking fluid exemption went too far, as ProPublica reported in March. And Rao, who worked as a senior VP at Halliburton while the Energy Policy Act was being written at the White House, said oil and gas companies favored the exemption. But he denied that Halliburton specifically asked to be exempted. “I would have known,” Rao said. “I don’t recall any discussion of an exemption.”

Yet Rao acknowledged that “the oil industry has not been mindful of environmental issues.” He added that not only should water quality related to fracking be regulated, so should the fluids. “There is no reason for them to be exempt.”

The stakes are high if North Carolina fails to establish stringent laws regarding fracking. “When companies get established, it’s going to be harder to turn from the wrong path. If the initial set of standards isn’t protective enough, the inertia will make it more difficult to make it right,” Gisler said.

House Bill 242, the study bill, as it’s known, has support from several environmental groups, including the Sierra Club and Environmental Defense Fund. However, a major shortcoming of HB 242 is that it requires DENR to deliver an exhaustive study of the environmental, economic and social impacts of fracking by Sept. 1just four months. This deadline is long before the EPA will have completed its preliminary fracking study, which is not due until next year. The EPA’s final study isn’t expected until 2014.

“That’s why North Carolina shouldn’t be in a big hurry,” Gisler said. “They’re requiring some action by the state before the EPA study will be done. Why not take advantage of that information?”

Several environmental groups are asking Rep. Gillespie to postpone the study deadline until at least next spring. Other federal information is also forthcoming that could inform the state’s study, if DENR had additional time to weigh and incorporate it. Last week, U.S. Energy Secretary Steven Chu appointed a special scientific panel, although it’s loaded with people with industry connections, to examine fracking. Chu charged that panel with producing “immediate recommendations” within 90 days.

SB 709 is also a fracking study bill. Jeff Warren is senior adviser to Senate Pro Tem Phil Berger, R-Rockingham, on energy, environment and regulatory affairs. He also worked for Phillips and served on the Coastal Resources Commission and two legislative committees on offshore energy exploration. “There are two sides to the argument,” he said, adding that SB 709 sets a later deadline of next May. “The Senate is not rushing into it.”

Exxon Mobil’s television ad with the folksy geologist purports that fracking is a safe way to extract natural gas. But the energy giant neglects to mention the dubious safety record of its subsidiary, XTO Energy, which has been under investigation by Pennsylvania environmental authorities since it spilled 13,000 gallons of tainted wastewater from its fracking operations that washed into nearby waterways.

Instead, the Exxon geologist guides us on a magical mystery tour of natural gas exploration: “A lot of the time, things are right underneath our feet and all we need to do is change the way we are thinking about them.”

We are already changing the way we think about what’s below our feet, but not always for the better. We view our environmental resources as commodities intended to satisfy our hunger for energy. But we need to change our viewpoints about our water, air and land. They are finite resources, and when they’re gone, so are we.

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Drill your legislators on fracking

Fracking is currently outlawed in North Carolina, but three bills that are moving through the Legislature are the first steps in legalizing the drilling method.

Ask your lawmakers about their opinions on fracking and let them know your thoughts. Their email addresses are “first name.last name (at) ncleg.net”. For example, josh.stein@ncleg.net.

House Bill 242

  • Read the bill
  • Directs the N.C. Department of Environment and Natural Resources to study the environmental, economic, social and infrastructure impacts of fracking. The study must be completed by Sept. 1; findings would be presented to the Environmental Review Commission.
  • Calls for public hearings at two to-be-determined locations in the Triassic Basin, an area that extends from southern Granville County southwest through Durham and parts of Wake, Chatham, Lee and Moore counties.
  • Require a drilling operator to post a minimum of a $5,000 bond, plus a $1,500 fee per well before drilling begins and an additional $450 when the well is plugged and abandoned.
  • Primary sponsors: Mitch Gillespie, R-Burke and McDowell; Mike Stone, R-Lee and Harnett
  • Status: Referred to House Finance Committee. Local lawmakers on this committee: Durham: Democrats Paul Luebke and Larry Hall; Orange/ Chatham/ Moore: Democrat Joe Hackney; Wake: Democrats Deborah Ross and Jennifer Weiss and Republican Paul Stam

Senate Bill 615

  • Read the bill
  • Similar to the House bill but less comprehensive.
  • Primary sponsors: Bob Atwater, D-Chatham, Durham and Lee; Harris Blake, R-Harnett and Moore
  • Status: Referred to Senate Finance Committee. Local lawmakers on this committee: Durham: Bob Atwater and Floyd McKissick Jr., both Democrats; Orange: Democrat Ellie Kinnaird; Wake: Democrat Josh Stein and Republicans Neal Hunt and Richard Stevens

Senate Bill 709

  • Read the bill
  • This 13-page energy bill deals with fracking and mandates other major changes to the state’s energy policy.
  • Renames the Energy Policy Council as the Energy Jobs Council and reconfigures its membership to include nearly all utilities and oil and gas industry representatives.
  • Directs the governor to vigorously pursue off-shore drilling by forming compacts with neighboring states and petitioning the federal government to open areas of the Atlantic Ocean, including North Carolina’s offshore waters, to oil and gas exploration and drilling.
  • Directs DENR to review existing state laws regarding fracking, analyze other states’ fracking regulations, recommend amendments to North Carolina laws that could allow fracking, study its environmental impacts and develop proposed regulatory framework for the practice.
  • Primary sponsors: Republicans Bob Rucho of Mecklenburg; Senate Majority Leader Harry Brown, representing Onslow and Jones; Tommy Tucker, representing Mecklenburg and Union counties
  • Status: Passed the Senate; now goes to the House. See “Drill bill: SB 709 passes, focuses on oil and gas.”