THE Fracking Thread (merged)

[dinopello]

THANK GOD the USA invented National Parks so there will be always be a few places safe from frakking.

Dream on, God isn't going to save the National Parks or National Forests. They will be frakked as long as there is gas and and economic return.

[Plantagenet]

THANK GOD the USA invented National Parks so there will be always be a few places safe from frakking.

Dream on, God isn't going to save the National Parks....

You go dream on---your fantasies of frakking in the National Parks are silly. You obviously don't understand what the National Park System is all about.

[dinopello]

You obviously don't understand what the National Park System is all about.

Why don't you enlighten us. There are already hundreds of oil and gas operations in 13 national parks, ranging from Big Cypress National Preserve in Florida to Padre Island National Seashore in Texas. Why would frakking not be allowed ? Cuyahoga NP is likely to be frakked up soon.

[dinopello]

Hydraulic fracturing fluids are primarily water. This fluid is pumped under pressure underground, and then it is allowed to flow back to the surface, where it is captured and disposed of under applicable EPA and UIC rules, the Marcellus frac water for example is being put on rail cars and disposed of in Ohio.

Apparently one of the (non-secret) ingredients is guar gum, like they use in ice cream. Prices are going up though.

Once utilized as cow fodder and for poor man’s curry, the guar bean is now a key element in the chemical cocktail used to frack wells, the technology that has prompted the oil and gas boom sweeping across North America, and is set to spur a worldwide boost in oil and gas recovery. India produces some 80% of the world’s guar gum, a hydrocolloid — a substance that forms a gel when mixed with water.

The rising price of the gummy gold was blamed by Halliburton late last month for a decrease in profits so far this year. “The price of guar gum has inflated more rapidly than previously expected due to concerns over the potential for shortages for the commodity later in 2012. As such, the costs have impacted the company’s second quarter North America margins more than anticipated,” the company asserted in its earnings statement.

[steam_cannon]

As fracking continues to grow as a portion of our energy picture it also attracts a lot of negativity like coal and every other form of energy. The article below addresses some of this negativity. Of course this article is industry pushback pr bs. A fair amount money spent on forced SEO marketing to push this article into the headlines. That said, any thoughts on the points they are pushing? PR or a some good points? Either way, it's news...

Article: Some fracking critics use bad science

PITTSBURGH — In the debate over natural gas drilling, the companies are often the ones accused of twisting the facts. But scientists say opponents sometimes mislead the public, too.

Critics of fracking often raise alarms about groundwater pollution, air pollution, and cancer risks, and there are still many uncertainties. But some of the claims have little — or nothing— to back them.

For example, reports that breast cancer rates rose in a region with heavy gas drilling are false, researchers told The Associated Press.

Fears that natural radioactivity in drilling waste could contaminate drinking water aren't being confirmed by monitoring, either.

And concerns about air pollution from the industry often don't acknowledge that natural gas is a far cleaner burning fuel than coal.

"The debate is becoming very emotional. And basically not using science" on either side, said Avner Vengosh, a Duke University professor studying groundwater contamination who has been praised and criticized by both sides.

Read more...

[dinopello]

Nationwide Insurance will not cover damage from fracking.

The memo reads: "After months of research and discussion, we have determined that the exposures presented by hydraulic fracturing are too great to ignore. Risks involved with hydraulic fracturing are now prohibited for General Liability, Commercial Auto, Motor Truck Cargo, Auto Physical Damage and Public Auto (insurance) coverage."

It said "prohibited risks" apply to landowners who lease land for shale gas drilling and contractors involved in fracking operations, including those who haul water to and from drill sites; pipe and lumber haulers; and operators of bulldozers, dump trucks and other vehicles used in drill site preparation.

Kind of suprising considering how much of the country could be exposed to fracking (regardless of what you think the risk level is). Nationwide could lose a lot of business if other insurance companies will insure against fracking related damages.

[Plantagenet]

You obviously don't understand what the National Park System is all about.

There are already hundreds of oil and gas operations in 13 national parks, ranging from Big Cypress National Preserve in Florida to Padre Island National Seashore in Texas.

You obviously don't understand what the National Park System is all about.

National Parks are are not the same as National Preserves and National Seashores. In particular, national parks have a higher level of environmental protection then other federal lands.

Cheers!

[diemos]

You obviously don't understand what the National Park System is all about.

All those in favor of frakking the National Parks?

Aye.

Motion passed.

That's all it takes for those protections to disappear.

[Pops]

Is this becoming a trend?

Analyst: Calif. shale oil field results disappoint

A California oil field thought to be one of the biggest in the U.S. has been producing much less oil than hoped, according to a report by Alliance Bernstein analyst Bob Brackett.

[rockdoc123]

Pops I think the telling comment in this article is

But drillers haven't been able to get the Monterey Shale to produce oil at high rates. Brackett suggests that there are a few characteristics of the geology that could make the field more difficult to develop. There are lots of natural faults in the rock, which means drillers can't easily control the flow of oil through faults they create. Also, the rock is not under enormous pressure, so there is less force pushing the oil to the surface. And the oil may be relatively thick and sticky, which slows its flow.

Basically it isn’t analogous to other liquid rich shales such as the EagleFord which tends to be free of natural fractures and is overpressured. Most importantly my understanding is that the oil in the Monterey tends to be quite heavy (9 to 11 API) with surface temperature viscosities up to 10,000 cp. In comparison EagleFord oil has API in the mid-thirties and higher with viscosities in the tens of centipoise range.
To put that in context if you look at normal recovery factors for heavy oils from conventional reservoirs with similar rheology to the Monterey oil you are generally thinking of primary recovery from cold flow of not much more than 10%. In contrast light oil pools can see recovery factors in the 40% to 50% range, all other things being equal.

[lper100km]

Rockdoc: So if these factors were known before the event, why would it be thought attractive enough to go to the expense and potential eco damage for a disappointing return? Desperation?

[Pops]

Thanks doc. This is what I've been concerned with in the whole gold rush atmosphere promoted by Chesapeake and others, basically the rush was central to the actual "play" which was buying up leases and flipping them off to the majors.

n the Energy Information Administration's recently released "Review of Emerging Resources," the federal agency pegs the Monterey play at 15.42 billion barrels of technically recoverable oil, compared to the Bakken's 3.59 billion and the Eagle Ford's 3.35 billion.

This quote from some stock hawker last year seems prophetic albeit not in the manner he intended:

"It takes time for the mainstream to realize what's going on,"

Platts: A big shale play in California could boost the Golden State's oil patch

[rockdoc123]

Rockdoc: So if these factors were known before the event, why would it be thought attractive enough to go to the expense and potential eco damage for a disappointing return? Desperation?

My understanding is there are a couple of companies active in the play, Chevron and some other small start up whose name alludes me right now. Obviously they thought they could do better. There has been attempts of innovative new tech (using acid) to try and improve recovery and I suspect they have tried to direct their fracs away from identified open pre-existing fractures. As well we don't actually know what the companies economics are related to this play. They might actually be doing very well with the current recovery.
As with anything in this industry there are risks. Generally you try to limit your downside which means if you get disastrous results you have a get out of jail card where you can limit your loses. The fact they seem to be ploughing ahead suggests to me the results aren't as good as they hoped but they are still good enough to make a decent return on investment.

[sparky]

.
The ladder of sucess is made of the rungs of failures
in the oil game , dispointment is nothing new

Fracking is looking for its limits of aplication ,
a lot of tries at the margins will evolve into a solid grasp of what can be done
the big question is the depletion curve and the extraction rate for various crudes
the tech still have some learnig to do , they are doing it now

[Plantagenet]

Chevron considers California to be its territory. It's not surprising
That Chevron would be aggressive in trying to frak there. When I worked for
Chevron years ago there was an offshore lease sale off Santa Barbara. Chevron bid more than twice the next highest bids for the blocks they wanted just so they could be certain to win on their home turf

[Pops]

Did this get mentioned? From the same guy:

Bob Brackett, an analyst with Bernstein Research, studied a dozen years of shale oil drilling data for this mountainous state [Montana] bordering Canada. What he found was a steep oil production increase through 2006 -- surpassing 100,000 barrels a day -- followed by a fast, 40 percent decline to about 60,000 barrels a day today. The plummet is counterintuitive because the time frame coincides with a capital spending binge by the industry -- tens of billions of dollars poured into the new innovations and technology that have opened up the Bakken and other shale plays. So why has Montana's production dropped? "Resource plays," Brackett writes in a note to clients today, "have limited/finite drilling locations. The best locations get drilled early, the less economic ones later, and once they are drilled, operators move on." In other words, Brackett told me in a followup email, "industry drilled the low hanging fruit first, and now can't find the same quality of opportunity."

But surely this is just Montana, right Bob? You don't mean to suggest that the entire Bakken formation, including North Dakota -- on which so many North American projections centrally rely -- is in trouble, too? Sadly, that is precisely what Brackett means. In fact, he has quantified the Bakken's production trajectory. The key number is six - that is the longevity of a Bakken well before it turns into a "stripper," industry argot for a worn-out nag producing just 10 or 15 barrels a day, from 400 barrels a day at its peak. Right now, just 200 modern Bakken wells are strippers. But in roughly six years, there will be 4,000 of them, Brackett says. "All good things in the oil patch come to an end," Brackett told me. "In the case of North Dakota, that is a long time -- years -- off, but even that too will suffer the same fate" as Montana.

More at FP

[rockdoc123]

Pops
here is a good article from service industry folks that addresses the statistics. They mention the problems the "advisors" such as Berman and his team have inasmuch as they do not have access to the detailed data and have to guess from production data. This paper illustrates pretty much what I have said before about type curves. Each shale lithology has its own type production curve but they all follow the same pattern high rates followed by quick decline and then usually a long flat piece which is a function of length of well and number of open fractures. Note that the average EUR's are pretty much in line as well. What's significant about this is the shale developments tend to be much more predictable than conventional oil and gas. If you remove the risk element then you feel better about large investment.

http://www.slb.com/resources/publications/industry_articles/dcs/201105_aogr_shale_decline_rates.aspx

[socrates1fan]

http://www.examiner.com/article/ge-frac ... to-justify

GE has significant investments in nuclear, so this is a pretty big deal. Germany, one of the richest countries in the world is shutting down all of its nuclear power plants. If that doesn't tell you something, then I don't know what will.

People who praise nuclear energy as the cure for peak oil don't realize just how much of an investment we would have to make to replace oil with nuclear power. Even new fantastic models are still far from being economical. Not to mention the fact that uranium itself is a finite resource (half of our uranium in the US comes from old nukes) and if we transferred over to nuclear it would run out fairly quickly.

If society collapsed tomorrow, we would all die thanks to nuclear power plants. If the crash comes over the course of a decade or two, and nuclear powers go into shutdown and cooling (takes about 5 years) then we should be okay. Right now the trends look positive for us, but I don't know.

[Graeme]

Fracking floors energy giants

BHP Billiton is about to become the next victim of the latest asset bubble to burst – US shale gas, the rock-based hydrocarbon that is released via the controversial process of fracking.

A fortnight after writing $2.84bn (£1.84bn) off the value of its Fayetteville shale gas business in Arkansas, BHP is poised to reveal on Wednesday that the charge helped push down its profits by a massive 40 per cent – to $14.2bn – in the year to June 30.

The FTSE 100 mining giant was forced into the writedown after a decade-long stampede into the brave new world of US shale gas produced so much of the stuff that its price tumbled to 10-year lows, taking the value of its producers with them.

"Put simply, the surge in shale gas production has caused a massive near-term oversupply which has caused the gas price to plunge," said Glynn Williams, a partner at oil and gas services investment firm Epi-V.

independent

[pstarr]

The problem is not "oversupply." The problem is "undersupply" or even "reasonablesupply"as a cost that is useful to our economy and infrastructure. Sure we can produce natural gas at $7tcf, but we have no use for gas at $7tcf. We have plenty of applications for natural gas at $4tcf (such as electrical generation competitive with coal, feedstock for plastics and fertilizer, etc) but when natural gas gets too abundant and too expensive then we walk away.