With the latest news of the Pegasus pipeline accident causing what could be irreparable damage to the environment (let alone the dozens of homes in an Arkansas neighborhood), one thing is clear: no matter how many measures a company takes to ensure safety, accidents can and will happen.
As more data streams in from financial analysts, scientists and other experts, the touted “100 years’ worth of viable natural gas extraction” is no longer an accurate statement. The Energy Information Administration (EIA) has given the latest figures which paint a bleaker picture than what Gas and Oil Companies would like to acknowledge.
The Latest Figures
In the December 2012 EIA report, it is estimated that there is 40 percent less trillion cubic feet of shale gas than previously reported in 2011. It has also been estimated that for the Marcellus Shale region (NY, W.Virginia, Ohio, and PA areas), there is a significant (66 percent) drop of cubic feet estimated to actual exist in those areas. How can these numbers be so different? I’d like to think beyond the dark theories and simple state the obvious: human error occurs.
Taking a Lesson from History
By historically looking at previous well activities in other areas, we can get an idea of incidents that will likely occur. Will traffic flow change? It only takes a bit of common sense to realize when a new company comes to town and they need hundreds of trucks to transport water and chemicals, congestion will happen – accidents will happen.
For the moment, forget the issues of what happens for any other aspect of HVHF, except the traffic issue. What could happen in one chemical spill, one truck not adhering to the crosswalk law as your child comes home from school, or one tired rig driver missing a stop sign?
Cost vs. Benefits
Are the costs of allowing HVHF to occur in your area worth the benefits? By looking at just one aspect of what can occur, one may see the price for allowing HVHF is just too high to be worth the effort. Others may not agree. But let’s take a look at the latest financial reports from Deborah Rogers, an advisory committee member from the U.S. Extractive Industries Transparency Initiative (USEITI) from within the Department of Interior in a 2013 report called Shale and Wall Street: Was the Decline of Natural Gas Prices Orchestrated?
Shale development is not about long-term economic promise for a region. Such economic promise has failed to materialize beyond the first few years of a shale play’s life in any region of the U.S. today…Retail sales per capita and median household income in the core counties of the major plays are underperforming their respective state averages in direct opposition to spurious economic models…
Shale Development Not About Job Creation
…Direct industry jobs (for onshore and offshore oil and gas) have accounted for less than 1/20 of 1% of the overall U.S. labor market since 2003, according to the Bureau of Labor Statistics. This cannot be construed as game changing job creation.
Shale development is not about the long-term financial viability of shale wells.
Industry admits that 80% of shale wells “can easily be uneconomic.” Massive write-downs have recently occurred which call into question the financial viability of shale assets and possibly even shale companies. In one case, assets were written off for more than 50% of the purchase price within a matter of months.
An Ounce of Prevention
No one wishes for an accident like the Arkansas oil spill to happen in their neighborhood. But accidents do happen and you should be aware of those possibilities if you chose HVHF for your town. Take time to do your homework and read information from reputable sources involving HVHF and determine for yourself if the benefits outweigh the costs.