The debate over fracking

Marketplace Staff Jul 5, 2011

The debate over fracking

Marketplace Staff Jul 5, 2011

CORRECTION: The text of this interview incorrectly describes leaks of fracking chemicals from wells. There have been suspected leaks, but none confirmed.

Kai Ryssdal: Crude oil rose almost $2 today, closed just shy of $97. That consistently high per barrel price is one of many reasons the energy industry’s turning its attention to a commodity measured in cubic feet. But that attention to natural gas brings with it scrutiny as well, specifically about a kind of drilling called hydraulic fracturing — fracking.

Last week the state of New York took some baby steps to allow more fracking, which has of course pleased nobody. Marketplace’s Scott Tong’s on the line to help put this in some perspective. Hey Scott.

Scott Tong: Hey Kai.

Ryssdal: So remind us what Gov. Cuomo in New York did last week, would you?

Tong: Well his government began the process of lifting the ban. So we’ve entered the world known as the regulatory process. The upshot, Kai, is New York accessed the environmental risk and it said, OK, we’re going to allow drilling, but not in sensitive places like New York City and its water sources and Syracuse. So 85 percent of the state is going to be open to drilling, but still, that’s more restrictive than the other states, where drilling is already happening. So industry is not happy. I spoke to economist Mike Giberson over at Texas Tech, and he says the oil and gas companies, they feel that they know what they’re doing.

Mike Giberson: The people in the industry doesn’t feel like this is really a new thing, so they’re surprised that so much opposition has come up. I think the reason is partly because it’s moving it to areas where there hasn’t been a lot of oil and gas development before.

And New York state, Kai, is much different than say Texas, where they’re used to this kind of thing. Drilling is an industrial process; you’ve got trucks, yellow tape, big oil rigs, generators, waste water. So in New York, you have other sectors — like tourism and fishing and wineries — who fear they’re going to lose out. So it’s very contentious.

Ryssdal: You’ve actually seen fracking, right? You’ve been out to a drilling site, or whatever it is?

Tong: I have, yes, in western Pennsylvania.

Ryssdal: So walk us through: what does it look like?

Tong: Well, oil and gas is now in the province of the geeks, that’s the first thing to say. You know when you drive through a road where they’ve blown out the side of the hill, and you can see the rock formation on either side?

Ryssdal: Yeah.

Tong: And it looks like these layers, right? Shale rock looks like that. And in a lot of places, inside shale rock, there’s natural gas. So to get it out, you don’t just drill down — you drill down and then sideways. So that’s one breakthrough they’ve been able to do. The other one is you have to break the rock all the way deep down to get the natural gas out, so you shoot water and sand and chemicals down the hole to get the natural gas out. The risk, though, is human error. There have been cases where the well wasn’t sealed, it wasn’t operated the right way, so the chemicals leaked into the water supply. So the critics, they focus on the risk; the proponents, they focus on the technology. There is a lot of theology in this debate, and it keeps going and going.

Ryssdal: Well explain that debate a little bit. I mean, it’s not like natural gas is going to replace oil, say, tomorrow right?

Tong: Or in the next 30 years. Still, there’s a lot of people who use the term “shale gas revolution.” You have a lot of this drilling in the states. You have companies around the world who want to do the same thing: China, Argentina, Poland, Australia. And in the long term, there could be a whole lot of it, decades of supply. So a new report from the International Energy Agency says natural gas can bring more energy security to a lot of countries; it could leapfrog coal and become the number two energy source in the world behind oil; and it emits less carbon dioxide than coal, so environmentally, it’s a little friendlier. The title of the new report from the IEA is called “The Golden Age of Natural Gas?” (.pdf) So we could be getting there.

Ryssdal: I love the question mark. Marketplace’s Scott Tong from the Sustainability Desk. Scott, thanks a lot.

Tong: You’re welcome.

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