TPT-January-2015

Global Marketplace

Recent reports suggest that, in both cases, conventional views of “fracking” are questionable. As distinguished from a gusher oil well, the term “well” here denotes a drilled access to the exploitable rock. Shale gas producers commonly bore a deep vertical well that is then extended horizontally in several directions into the rock, like spokes from a hub. In fracking, water and chemicals are injected at high pressures into these spokes, creating fissures and releasing the trapped natural gas. The principal environmental concern is that fracking could cause the gas to migrate into drinking water aquifers. But a study of tainted water in areas of the US with extensive deposits of gas-bearing shale exploited over years by means of fracking shows that such contamination is more likely due to leaky wells than to the extraction process itself. As reported by science writer Henry Fountain in the New York Times , the study, published 15 September in the Proceedings of the National Academy of Sciences, looked at seven sites in Pennsylvania and one in Texas where water wells had been contaminated by methane and other hydrocarbon gases. The researchers found no evidence that fractured shale led to water contamination. Instead, they faulted the cement used to seal the outsides of the vertical wells, or the steel tubing used to line them, for allowing gas to leak up into the wells and into aquifers. (“Well Leaks, Not Fracking, Are Linked to Fouled Water,” 15 September) “In all cases, it basically showed well integrity was the problem,” said Thomas H Darrah, a researcher at Ohio State University and the study’s lead author. Rather than deriving from the shale itself, the leaking gas was mainly traced to shallower gas-rich pockets through which the vertical wells were drilled on their way to the shale formations. The good news, Dr Darrah said, is that “improvements in well integrity can probably eliminate most of the environmental problems with gas leaks.” › Richard J Davies, a professor at Newcastle University in Britain and a petroleum geologist not involved in the study, told the Times ’s Mr Fountain that it confirmed what he and others had shown earlier: that the fissures created by fracking were generally not long enough to affect aquifers. “It is good to know which parts of the fracking process are the ones we need to worry about,” Dr Davies said. The assumptions of ‘the shale revolution’ rest on recovery rate estimates that may be too optimistic by far “By calculating the production numbers on a well-by-well basis for shale gas and tight oil fields throughout the US, Post Carbon concludes that the future of fracking is not nearly as bright as industry cheerleaders suggest.” The work cited by Steve Horn, of the Montreal-based Centre for Research on Globalization (CRG), touches on the second major perception of hydraulic fracturing: its association with handsome profits.

Among the factors working against fare hikes, Mr Seaney said, are a reluctance on the part of airlines to charge more on a route than Southwest. And filling empty middle seats will always requires discounting, especially on low-demand days. But the October fare hike was sticking, despite concerns that fliers would be deterred by the Ebola outbreak that had reached the US after killing thousands of people in West Africa. Charisse Jones of USA Today reported that the airlines, backed up by some traveller surveys, were saying that demand had not diminished. › The US airline industry’s first successful system-wide domestic fare increase since April offered an example of how a bane to some people is a boon for others. In an investor’s note quoted in USA Today , Jamie Baker of JPMorgan wrote, “Evidence of domestic fare traction can hopefully allay investor concerns that lower fuel prices will simply be handed over to passengers in the form of lower fares.” Of related interest . . . › If US travellers by air are not benefiting from the decline in fuel prices, others are. When, on 14 October, the Paris-based International Energy Agency published a report lowering its estimate for growth in gasoline demand for last year and this, Americans were spending some $230 million a day less on the automotive fuel than they were on 4 July. The savings – based on price and consumption calculations by AAA, the biggest US motoring group – is easily explained. The Organization of Petroleum Exporting Countries was reporting its highest production in over a year and US oil output was at the highest level since 1985. The falling price of gasoline in the US was following a drop in the broader oil market. Brent Crude, the global benchmark, closed at $86.16 a barrel 17 October on the London-based ICE Futures Europe exchange after slipping the day before to $82.60, the lowest level since November 2010. US benchmark West Texas Intermediate settled at $82.75 on the New York Mercantile Exchange, after trading below $80 on 16 October for the first time since 2012. The lower cost of filling the tank represents the most tangible benefit yet that US consumers had seen from a record boom in domestic oil production, a surge contributing to the global crude glut and helping reduce international prices. Two presumptions about ‘fracking’, both open to challenge: its environmental threat and its virtually limitless potential Coverage of hydraulic fracturing, both in the general press and in scientific journals, tends to centre on two aspects of the controversial method of producing natural gas from shale: its danger to the environment and its promise of financial reward.

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J anuary 2015