The Promise of Shale Gas

The Promise of Shale Gas

February 19, 2010

Ken Silverstein
EnergyBiz Insider
Editor-in-Chief

Advanced drilling and completion techniques are the critical means by which natural gas developers now hope to probe vast amounts of shale gas, considered by many to be able to fuel much of the country's electric generation for decades to come. But before that aspiration can be achieved, producers must solve the environmental complexities.

At issue is how to retrieve such vast resources without harming water quality. The problem is that the shale is a sedimentary rock that holds natural gas 2,000-12,000 feet deep in the earth. To get it out, developers use a process known as hydraulic fracturing whereby millions of gallons of water and chemicals are pumped into the ground, allowing the natural gas to flow to the wellbore.

Advocates of hydraulic fracturing say that virtually all of the treatments are water and sand; although they acknowledge that the 0.5 percent that are chemical additives will multiply and must therefore be addressed. The potential fallout could affect marine life and water quality.

Some eastern states with access to the Marcellus Shale Formation are exploring the possibilities of recycling the wastewater. But until that process can be commercialized, some state regulators are expressing concern about local drinking water supplies.

Two decades ago, drilling for shale was not economical. It cost too much while developers couldn't get enough gas to pay for it all. But today that has changed. Modern technologies translate into more production: One gas well today can generate twice as much as a single gas well did in 1985, say natural gas groups. The drilling footprint of well pads, meanwhile, has decreased by as much as 70 percent.

The Potential Gas Committee reported in 2009 that the estimated natural gas resources rose by 35 percent from 2006 to 2008. It pegs that number at 2,074 trillion cubic feet, which includes proven reserves -- an increase that is largely attributed to shale formations and the ability of advanced drilling and hydraulic fracturing to allow recovery of the gas. Of the total, shale accounts for about a third.

"We have always known that this shale gas has existed as gas-in-place," says Dr. John B. Curtis, principal author of the Potential Gas Committee's report and who is a professor at the Colorado School of Mines, in a telephone interview. "But technology has allowed us to convert this to a technically recoverable resource."

Overall, the Gulf Coast, including the Gulf of Mexico continental shelf, slope and deepwater, remains the country's richest resource area, the report says. That is followed by the Rocky Mountain, Atlantic and Mid-Continent regions, which together account for 87 percent of the 2008-assessed traditional resource, it continues.

Recycling Potential

The process of exploring for shale gas begins with horizontal drilling. Such a technique starts the same as "vertical drilling" but then moves laterally. It uses a drainage network to siphon off the available gas. Vertical wells, by comparison, go straight down. And while vertical drilling is cheaper than horizontal drilling, it is less productive.

But if developers want the shale gas to start flowing they must then use hydraulic fracturing, according to Dr. Curtis. That's because the shale formations are so far beneath the earth's surface and yield gas so slowly that it then becomes necessary to "stimulate" the well further by "fracturing" it. That procedure has proven to be safe for several decades, he adds, noting that several existing studies come to this conclusion.

"Of the tens of thousands of wells we drill yearly, only a small number of them have ever shown to have any proven contamination of water supplies from the fracturing technique," says Curtis. "To reach the shale formations, you must go far below the drinkable water supplies and you therefore encounter water that is naturally very salty and often considered corrosive."

But the problem is that some water used in the fracturing treatment itself is flowed back up the wells as a normal part of the fracturing treatment. An Associated Press story says that between 15 percent and 40 percent of the water used in the fracturing treatment flows back to the well operator with chemicals in it that sewage treatment facilities are not equipped to remove. Authorities in Pennsylvania, meanwhile, have become alarmed that some drinking water supplies used by 700,000 people and tied to the Monongahela River were not up to snuff.

Unlike the West where such wastewater can just evaporate, Appalachia is too humid. Therein lays the potential to recycle the wastewater, which the Associated Press story says is spawning a rash of entrepreneurial activity. It specifically points to a facility in Fairmont, W.V. that can treat 200,000 gallons of water a day.

Similar technologies could soon come of age given that the U.S. Department of Energy is projecting natural gas use to rise by 13 percent by 2030. The objective then becomes to protect local ecologies and to maintain the quality of drinking water supplies

"Hydraulic fracturing of the Marcellus Shale will require large volumes of water to fracture the rocks and produce the desired amount of gas," says the New York State Department of Environmental Conservation. "Each well may use more than one million gallons of water. The department is assessing the chemical makeup of these additives and will ensure that all necessary safeguards and best practices are followed."

Hurdles still obstruct natural gas production. But developers have reason to be positive. The increased demand for cleaner burning fuels is providing the impetus to improve drilling techniques that can deliver shale gas. If the industry is to reach its potential, however, new disciplines must emerge and especially those that can preserve environmental standards.