Natural Gas Hydraulic Fracturing 101 NC Energy Policy Issues Committee February 15 th, 2012 Tom Hassenboehler Vice President of Policy Development and Legislative Affairs
About ANGA ANGA is dedicated to increasing the understanding of the environmental, economic and national security benefits of clean, abundant, dependable and efficient North American natural gas.
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Future U.S. Energy Demand Energy Consumption by Fuel 1980-2035 (quadrillion BTU) 120.00 100.00 80.00 60.00 40.00 1980 7.0% 3.5% 19.7% 25.9% 2010 8.0% 8.6% 21.5% 25.2% 2035 13.6% 8.1% 21.3% 23.8% Renewables Nuclear Coal Natural Gas 20.00 43.8% 36.7% 33.2% Oil 0.00 1980 1985 1990 1995 2000 2005 2010 2015 2020 2025 2030 2035 Source: EIA Annual Energy Outlook 2011
The Real Role of Renewables 97.4 quadrillion btu 2010 Natural Gas 25% Oil 37% Coal 22% Nuclear 9% Renewables 8% 0.9% Wind 0.1% Solar 0.4% Geothermal 2.5% Hydroelectric 4.1% Biomass & Biofuels 113.9 quadrillion btu 2035 Oil 33% Natural Gas 24% Renewables 14% 1.4% Wind 0.1% Solar 1.1% Geothermal 2.7% Hydroelectric Coal 21% Nuclear 8% 8.2% Biomass & Biofuels Source: EIA Annual Energy Outlook 2011
The Shale Gas Revolution Cody Bakken Baxter-Mancos Mancos Mowry Gammon Niobrara Antrim Marcellus/ Devonian/Utica EIA: 2011 862TCF shale Lewis Barnett- Woodford Pierre Woodford Barnett Eagle Ford Mulky Fayetteville Haynesville New Albany Floyd-Neal 2,543TCF total 67% INCREASE in just three years Source: EIA Annual Energy Outlook, 2008 to 2011
North Carolina Resource Potential From Reid, J.C. and R.C. Milici. 2008. Hydrocarbon Source Rocks in the Deep River and Dan River Triassic Basins, North Carolina
Abundant by Any Estimate Estimates of U.S. Recoverable Natural Gas (TCF trillion cubic feet)) 4000 3,600 3500 3,350 3000 2,836 2500 2000 1500 1,268 1,314 1,312 1,532 2,074 2,170 2,102 2,100 2,543 1000 500 0 2000 2002 2004 2006 2008 2010 2009 ICF^ 2010 CERA 2010 MIT 2011 EIA NPC 2011 Survey High INGAA ICF 2011 Study Potential Gas Committee Other Estimates Sources: ICF: As reported in MIT Energy Initiative, 2010, The Future of Natural Gas, interim report ; Table 2.1 EIA: See http://www.eia.gov/analysis/studies/worldshalegas/ PGC: Potential Gas Committee s Advance Summary and press release of its biennial assessment; see www.potentialgas.org CERA: IHS CERA, 2010, Fueling North America s Energy Future: The Unconventional Natural Gas Revolution and the Carbon Agenda MIT: MIT Energy Initiative, 2010, The Future of Natural Gas, interim report NPC: Realizing the Potential of North America s Abundant Natural Gas and Oil Resources Johns Hopkins University ; Prudent Development Study 2011
How We Use Natural Gas How Natural Gas is Used Today 3% Transportation 14% Commercial 30% Electric Power 32% Industrial 21% Residential Source: EIA, Natural Gas Year In Review, 2009
Cleaner For Power Generation When used to generate electricity, natural gas burns cleaner than other fuel sources, with less pollutants and no mercury. Reduces CO 2 emissions 50% Reduces NOx emissions 80% Virtually Eliminates SO 2 Emissions 99.96% Virtually Eliminates Particulate Emissions 99.74% Completely Eliminates Mercury Emissions 100%
Cleaner for Vehicles Compared to gasoline or diesel, NGVs: Reduce CO 2 emissions 20-30% Reduce CO emissions Reduce NOx emissions Reduce Particulate Matter emissions Reduce VOC emissions 70-90% 75-95% 90% 89%
Benefits: What We Can Do Replacing 3.5 million medium- and heavy-duty trucks and buses with CNG-powered counterparts by 2035 would save at least 1.2 million barrels of oil per day.
PRODUCTION
Risk Natural Gas Risk vs. Benefit All energy production comes with some environmental risk. Benefits Energy Security, Clean Air, Jobs, Enhanced Domestic Competiveness Realizing the Benefits Requires commitment of industry and regulators to continuous improvement in practices to eliminate or minimize environmental risk.
Conventional/Unconventional Geology http://www.eia.gov/energy_in_brief/about_shale_gas.cfm
Drilling Down: A Closer Look http://www.anga.us/issues--policy/safe-- responsible-development/dig-deeper
Horizontal Drilling Traditional Wells Horizontal Drilling
Hydraulic Fracturing Multiple protective layers extend from surface to below aquifers. Groundwater aquifers Private well, about 500 feet deep Public well, about 1,000 feet deep Several layers of steel tubes encased in cement protect groundwater supplies Shale Fractures Protective steel casing encased in cement extends to shale depth Depth from surface is typically more than a mile
Small Environmental Footprint Drilling 2 4 weeks Fracturing 3 5 days Producing decades surrounding land reclaimed
A Regulated Process Regulated by states and under the following federal laws: Clean Water Act surface water discharge, storm water runoff Clean Air Act air emissions associated with processing equipment and engines Safe Drinking Water Act underground injection disposal/reuse of produced water and flowback fluids Federal Land Policy and Management Act permitting for federal onshore resources Outer Continental Shelf Lands Act permitting for federal offshore resources National Environmental Policy Act permits and environmental impact statements Occupational Safety and Health Act requires information about chemicals used at every site Emergency Planning and Community Right-to-Know Act annual reporting to emergency responders of chemicals stored and used above certain quantities Extensive State Oversight implement federal laws and regulate drilling fluids and produced water management Detailed state regulatory information available at www.strongerinc.org
Frack Fluid Makeup Water & Sand 99.5% Additives - 0.5% Acid Friction Reducer Surfactant Gelling Agent Scale Inhibitor ph Adjusting Agent Breaker Crosslinker Iron Control Corrosion Inhibitor Antibacterial Agent Clay Stabilizer
Voluntary Disclosure System Chemical Disclosure & Operation Updates http://fracfocus.org/ created by GWPC and IOGCC 134 companies registered Information is currently posted on 11,270 wells 155,496 website visits
How Much Is 5 Million Gallons Of Water? A typical deep shale gas well stimulation = ~ 5 million gallons It s the same amount of water consumed by: 750 704 364 472 1,000 MWh 204 coal-fired power plant 14 in 11 HOURS 1,000 MWh nuclear power plant in 6 HOURS 34 52 Corn Field over 114 5 ACRES per SEASON Avg. golf course every 370 DAYS
Production: The Power of Progress Smaller surface impact. Less waste. The average well site today is just 30% of the size of its 1970s counterpart and today s wells can access over 60 times more below-ground area. Onsite water Recycling. Closes loop water recycling system. This eliminates the need to dig and use an open reserve pit. Greener Fluids. Many service companies are moving toward biodegradable solutions-such as food ingredients and ultra-violet light. Fewer air emissions. More efficient operations also means less energy consumption, and thus less air emissions, per unit of natural gas produced.
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Example: Regulation in PA NPC: Realizing the Potential of North America s Abundant Natural Gas and Oil Resources Johns Hopkins University ; Prudent Development Study 2011
Example: Regulation in PA
Example: Regulation in PA
Example: Regulation in PA