More than half of fracked wells in US are in drought areas: study

Houston (Platts)--6Feb2014/407 pm EST/2107 GMT

Of the almost 40,000 oil and natural gas wells hydraulically fractured in the US over a a nearly two-and-a-half years, more than half were in areas experiencing drought, according to a study released this week by non-profit group Ceres.

The study, which looks at 39,294 wells fracked between January 2011 through May 2013, found that 97 billion gallons of water were used, nearly half of it in semi-arid Texas. Ceres describes itself as a non-profit organization that advocates for sustainable business practices.

In an interview Thursday, Monika Freyman, the study's author, said competition for water is expected to grow in many of these areas as both populations and levels of oil and gas development increase.

"We worry, not so much that the industry will not be able to source the water, but that it will face increasing competitive pressure from other end-users," she said.

She added that while water use for drilling and fracking might only account for a small percentage of total consumption on a state-wide level -- typically about 1% to 2% -- local impacts of oil and gas operations could be much more significant.

"A lot of the drilling is taking place in two or three counties in a play and a lot of the water is sourced from groundwater in some regions. There needs to be more thought as to how to minimize those really intense local impacts," Freyman said.

The research, based on well data available at FracFocus.org and water stress indicator maps developed by the World Resources Institute, evaluates the energy industry's water use in eight US and Canadian regions with both intense shale energy development and the most pronounced water stress challenges.

More than 55% of the fracked wells studied were in areas experiencing drought.

In addition, the report found that more than 36% of the wells in the study overlay regions experiencing groundwater depletion.

After Texas, the top states for water used in fracking are Pennsylvania, Oklahoma, Arkansas, Colorado and North Dakota. Of more than 250 energy companies reporting to FracFocus, Chesapeake reported the largest amount of water use, nearly 12 billion gallons, followed by EOG Resources, ExxonMobil subsidiary XTO Energy and Anadarko Petroleum.

Among service companies, Halliburton handled the largest volume of fracking water overall, nearly 25 billion gallons -- more than a quarter of the US total -- followed by Schlumberger and Baker Hughes.

NEARLY HALF OF FRACKED WELLS IN AREAS OF HIGH WATER 'STRESS'

The study also found that almost half of the wells hydraulically fractured since 2011 were in regions with high or extremely high water stress. An area under extremely high water stress is one in which more than 80% of available surface and groundwater is already allocated for municipal, industrial and agricultural uses, according to WRI.

"Texas is ground zero for water sourcing risks due to intense shale energy production in recent years and a projected doubling of hydraulic fracturing-related water use over the next decade," the report found.

"All of this comes as over two-thirds of Texas continues to experience drought conditions, key groundwater aquifers are under stress and the state's population is growing."

The report found that the South Texas Eagle Ford Shale used the most fracking water of any US shale play, 19.2 billion gallons. Per-well water use was also high, averaging more than 4.4 million gallons.

In addition, the study said the Eagle Ford region of South Texas, which meets an estimated 90% of its water demand from groundwater, is experiencing groundwater depletion challenges.

In the West Texas Permian Basin, where water use for fracking is forecast to double by 2020, more than 70% of the wells are in extreme water stress areas. "Although average water use per well is much lower than in the Eagle Ford, the sheer number of wells in development is large, with over 9,300 wells reported developed since the beginning of 2011," the report stated.

Another area facing extreme water stress is the DJ Basin in the Niobrara formation in Colorado, where almost 2,900 wells have been drilled since 2011.

"Eighty-nine percent of the water used for hydraulic fracturing in Colorado was concentrated in two counties: Weld and Garfield. Overall water demand for hydraulic fracturing in the state is forecast to double, to 6 billion gallons by 2015, more than twice what the city of Boulder uses in an entire year," the study said.

Many of the smaller shale plays -- 100 to 2,000 wells -- are also in high and extremely high water stress regions, including the Piceance, Uinta, Green River, San Juan, Cleveland/Tonkawa and Anadarko Woodford basins, according to the report.

--Jim Magill, jim.magill@platts.com
--Edited by Jeff Barber, jeff.barber@platts.com

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