Although the agencies tried to make it a general discussion on oil and gas, the presentation and most of the questions from the audience focused on the controversial topic of fracking….and it was clear the local police and the agencies were prepared for potential trouble as there were six conservation officers and three police cruisers in the parking lot. (A clear difference from other DNR/DEQ presentations I’ve attended in the past!) Despite the controversial topic, decorum was maintained and there were no disturbances.

The issue of fracking has been getting a lot of press recently but companies have been doing it in Michigan in a lesser but somewhat comparable form since 1952. Since that time more than 10,000 fracking wells have been installed in Michigan, mostly in a geological formation called the “Antrim Shale.” Since 1925 a total of 60,000 oil and gas wells have been drilled; of those 4,500 have been for oil, 11,000 have been for gas and 3,000 have been for gas storage.

About 80% of the wells drilled in Michigan (and the U.S.) recently have been fracking wells and the natural (methane) gas produced from those wells have caused the price of natural gas to plummet in the U.S. to $2 per million British thermal units (compared to $10 in the U.K.) According to some analysts (as noted in this recent Washington Post article), this gas boom is fueling a revival in American manufacturing – something we desperately need in this country.

Naturally, this flush of inexpensive gas doesn’t come without weighty public policy issues, and the issues the attendees focused on during last night’s forum are the same being raised elsewhere in the country: contamination of groundwater aquifers and depletion of fresh groundwater.

According to the DEQ, vertical fracking wells use between 50,000 to 100,000 gallons while some horizontal wells (like most of the current wells) can use up to 20 million gallons of water. In comparison, total water withdrawals in Michigan in 2010 amounted to 267 billion gallons. (However, the DEQ admitted that most of the later amount returns to the environment while the millions of gallons of water used in fracking are permanently removed from and never return to the watershed due to the contaminants in it.) Although groundwater used for oil and gas production are exempt from Michigan’s water withdrawal legislation, the Supervisor of Wells issued Well Instruction 1-2011 which allows the DEQ to use Michigan’s water withdrawal assessment tool to determine if a proposed gas well will have an adverse impact on stream flow. If such an impact is identified, the DEQ does not issue a permit.

The DEQ also asserted that claims about “flaming tap water” (as seen on YouTube) due to fracking are false and the instances where it has occurred are not due to the fracturing of bedrock but methane leaking around improper well casings (or methane naturally seeping into an overlying aquifer). According to the DEQ, Michigan’s well casing requirements prevent this from happening. In Michigan, drillers are required to use several corrosion resistant metal casings (conductor, surface, intermediate, and production casings) that are cemented together to seal off the well from the surrounding environment. (A diagram of the typical well is depicted to the right.)gas well

If these requirements are followed, according to the DEQ, the risk of a well contaminating groundwater is very low.

All in all I think the DEQ/DNR did a good job at trying to explain the issues and point out some facts to ameliorate the public’s concerns but I don’t think the issues, especially the water withdrawal issue, will be going away any time soon. As with everything, the goal will be trying to find the right balance.

Additional information about the location and type of wells currently in Michigan can be accessed here and the DEQ’s GIS database (GeoWebFace) of oil and gas related information can be accessed here.

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A similar boom is going on with natural gas produced through fracking, and the U.S has become the largest producer of natural gas in the world. According to the Energy Information Administration website, the U.S. produced almost 30 million cubic feet of natural gas in 2012.

This new found energy production is having impacts elsewhere too. Oil and gas employment has increased 40 percent over the last 5 years.

Fracking also has created a huge demand for sand (a key ingredient in the fracking process). As noted in the Wall Street Journal, energy companies are expected to use 56 billion pounds of sand this year and it takes approximately 25 railcars of sand to frack one well.

The increased production and use of natural gas also appears to have had a positive environmental impact. By some accounts, C02 emissions in the U.S. have dropped 12% due to the switch from coal to natural gas.

Amidst all of this positive news, taxpayers, scientists and regulators are keeping a watchful eye on these industries due to health, safety and environmental concerns. In Oklahoma (a state with an average of 50 tremors per year) there have been 2,600 earthquakes in 2013 and the increase coincides with rise in fracking. The cause? Scientists suspect it’s due to the pressures created when fracking wastewater is injected deep underground. Other issues such as groundwater withdrawal and contamination also have been raised.

As with many aspects of our increasingly complex lives, as the U.S. enjoys the fruits of these energy resources, society will have to make hard policy decisions relating to the management of these risks and benefits.

The post The United States of Energy (Part 1) appeared first on Dawda PLC.

Michigan residents are paying close attention to gas and pipeline transport issues in the region because of our water resources.

What is the main issue in Michigan? Two words – groundwater withdrawal. Many Michigan rivers and streams are fed by groundwater. With fracking pads using up to 20 million gallons of water, the concern is fracking near waterbodies will result in reducing water levels to a point that fishing and boating will be adversely impacted. Recently, because of local opposition to oil and gas leases along the “Holy Waters” section of the AuSable River, the DNR designated those leases as non-production leases. In addition, the sensitivity of this issue for Michigan residents has prompted the MDEQ to re-evaluate its fracking rules.

Michigan residents are also concerned about oil transport through the Great Lakes region. Companies like Enbridge are building or expanding pipelines in Michigan to handle the increased production of oil elsewhere. There are also plans to build an oil shipping port in Superior Wisconsin so that up to 35,000 barrels (about 1.4 million gallons) of oil from Alberta’s tar sands can be shipped to refineries around the Great Lakes.

As many recall, in 2010 one of Enbridge’s oil pipelines near Marshall, Michigan ruptured spilling over one million gallons (about 24,000 barrels) of diluted bitumen (“dilbit”) oil into the Kalamazoo River – a spill that Enbridge is still cleaning up. While Michigan residents understand the need for oil, they are not interested in a repeat of the Enbridge spill – especially one that would involve one of the Great Lakes.

Although water is abundant around the Great Lakes, it is used by many for recreational purposes in addition to industrial/commercial uses. As a result, there is significant interest and demands for it to be managed so that it can be enjoyed by the greatest number of people.

The post The United States of Energy (Part 2): Concerns in Michigan and the Great Lakes appeared first on Dawda PLC.