Background about Shale Gas

Natural gas is mined and used for electricity generation, heating, and transportation fuel. Vast quantities of gas are trapped in shale formations around the world.  Shale rock is also known as “source rock” because natural gas and other fossil fuels were formed from organic matter deposited in these formations millions of years ago.

Over time, oil and gas migrates out of the shale into underground reservoirs (more permeable formations). Traditional or “conventional” oil and gas development focuses on finding those reservoirs.

Source: Louisiana Department of Natural Resources

By 2011 conventional gas made up just over one-quarter of total U.S. gas production (3.6 trillion cubic feet).  The rest of our natural gas comes from unconventional development, including shale gas development. Shale gas made up 40 percent of U.S. gas production in 2012, according to the EIA.  By 2035, the EIA predicts half of American gas will be produced from horizontal shale gas wells.

EIA Data

Advances in horizontal drilling and hydraulic fracturing have fueled the U.S. shale gas boom. Generally, a well operator drills a vertical well into shale rock, and horizontal radials through that rock to increase the surface area of the well-shale interface.  Next, the operator triggers contained explosions along the radial arms of the well, to begin to fracture the rock.  During the hydraulic fracturing (or “fracking”) stage, a service company pumps fracturing fluid – water mixed with sand and chemicals – into the well to extend the fractures and prop the fractures open.  Gas is released along these fractures, which are typically less than 1 mm in width but hundreds or thousands of feet in length, and migrates up the well.  This video provides a visual description of the process

What are the Potential Benefits of Shale Gas?

Natural gas is the cleanest burning fossil fuel.  According to the federal Environmental Protection Agency, “[c]ompared to the average air emissions from coal-fired generation, natural gas produces half as much carbon dioxide, less than a third as much nitrogen oxides, and one percent as much sulfur oxides at the power plant.” (Renewable forms of power production – solar, wind, geothermal, hydro – and nuclear plants emit no air pollution.) Substitution of natural gas for coal in electricity generation has helped to drive reductions in greenhouse gas emissions in the U.S.

Moreover, increased gas production has had positive economic impacts in some regions of the United States. Some have credited cheaper electricity for the modest “reshoring” trend for American manufacturing.

What are the Potential Risks of Shale Gas?

As shale gas development has expanded, so have concerns about the potential health and environmental risks associated with the activity.  A February 2013 study by Resources for the Future reflected broad consensus across industry, government, universities, and environmental groups about some of the potential risks posed by developing shale gas. Asked to prioritize 264 “risk pathways,” experts across these sectors agreed on these:

  • Stormwater runoff and habitat fragmentation from site preparation;
  • Methane leakage during drilling and fracturing (methane, the primary component of natural gas, is a potent greenhouse gas that contributes to climate change);
  • Freshwater withdrawals for fracturing;
  • Pollution of surface water and groundwater from the storage of fracturing fluids, flowback water, and produced water; and
  • Pollution of surface water from the treatment of flowback and produced water at municipal and industrial waste water treatment facilities.

In April 2013, the Wall Street Journal published an article on shale gas regulation that included this graphic, depicting some of the potential risks of this activity:



What is New and Different about the Risks Associated with Shale Gas Production?

Many of the potential risks cited are not unique to this type of natural gas production.  Often, increased risk – or the perception of increased risk – is driven by the growth in scale and intensity of shale gas production.

While hydraulic fracturing has been used as a technique for decades, wells are now many times longer and drilled deeper into solid rock formations, increasing the amount of chemicals, energy, and water needed to achieve production.
shale gas growth

Rapid growth of any industrial activity can pose governance challenges.  States may find that previously approved wastewater retention or disposal methods can’t handle the increased capacity.  Local roads, social services, and hospitals may be unable to meet rising demand.  Agencies and elected officials may receive a sharp uptick in complaints from residents who are suddenly contending with truck traffic, air pollution, and noise.

One stage of shale gas production is different from conventional gas production – the hydraulic fracturing stage.  Perhaps for this reason, the potential risks posed by this stage have attracted the most attention in the press, and in policy responses.

According to ExxonMobil, hydraulic fracturing fluid is typically comprised of approximately 98 to 99.5% water and sand or small ceramic beads.  (The sand and ceramic beads prop open the fractures.)  The remaining 0.5 to 2% consists of chemical additives, including acids to dissolve the rock, lubricants to aid flow, and biocides to kill things that might otherwise grow inside the well.

The chemicals represent a small fraction of the volume of fracturing fluid. However, given the large volumes of fracturing fluid used in a typical shale gas well, each fracking job can contain thousands of gallons of chemicals.  Safe handling, transport, storage, and disposal practices are necessary to reduce the risk of exposure for workers, communities, and the environment to these chemicals.

NOTE:  Hydraulic fracturing is also used to extract oil from shale formations like North Dakota’s Bakken Shale and the Eagle Ford in Texas.  Many of the governance challenges will be similar.  However, shale oil poses different policy implications.  For instance, when natural gas displaces coal in the electricity sector, it reduces criteria and greenhouse gas pollution from power plants.  Shale oil would be used alongside conventional oil, and may not represent an opportunity to reduce combustion emissions.