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The Cost of Fracking: Environment Maryland Documents the Dollars Drained by Dirty Drilling

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A report issued by extreme environmentalist group Environment Maryland, which supposedly documents problems with hydraulic fracturing for natural gas.

A report issued by extreme environmentalist group Environment Maryland, which supposedly documents problems with hydraulic fracturing for natural gas.


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  • In its demonization of fracking, this piece resorts to nitpicking and reflects a desperation almost as great as compulsions to hog and screw up water supplies - when sensible design and energy consumption can much better address justifiable needs.
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  • 1. The Costs of Fracking The Price Tag of Dirty Drilling’s Environmental Damage
  • 2. The Costs of Fracking The Price Tag of Dirty Drilling’s Environmental Damage Environment Maryland Research & Policy Center Tony Dutzik and Elizabeth Ridlington, Frontier Group John Rumpler, Environment America Research & Policy Center Fall 2012
  • 3. AcknowledgmentsEnvironment Maryland Research & Policy Center sincerely thanks Emily Wurth of Foodand Water Watch, Martin Levin of Stern Shapiro Weissberg & Garin, and JonathanShefftz of JShefftz Consulting for their review of drafts of this document, as well as theirinsights and suggestions. Thanks also to Erika Staaf of PennEnvironment Research &Policy Center and Luke Metzger of Environment Texas Research & Policy Center fortheir perspectives and contributions.Environment Maryland Research & Policy Center thanks the Colcom Foundation formaking this report possible.The authors bear responsibility for any factual errors. The recommendations are thoseof Environment Maryland Research & Policy Center. The views expressed in this reportare those of the authors and do not necessarily reflect the views of our funders or thosewho provided review.© 2012 Environment Maryland Research & Policy CenterEnvironment Maryland Research & Policy Center is a 501(c)(3) organization. We arededicated to protecting our air, water and open spaces. We investigate problems, craftsolutions, educate the public and decision-makers, and help the public make their voicesheard in local, state and national debates over the quality of our environment and our lives.For more information about Environment Maryland Research & Policy Center or for ad-ditional copies of this report, please visit www.environmentmarylandcenter.org.Frontier Group conducts independent research and policy analysis to support a cleaner,healthier and more democratic society. Our mission is to inject accurate information andcompelling ideas into public policy debates at the local, state and federal levels. For moreinformation about Frontier Group, please visit www.frontiergroup.org.Layout: Harriet Eckstein DesignPhoto Credits: Main cover photo: Robert Donnan; Photos used on inset of cover, as icons and in infographics: Boydrinking water, Ken Bosma, flickr, Creative Commons; Construction Roadwork, Doug Tone, flickr, Creative Com-mons; Doctor and Patient, AntoAB, cc, flickr, Creative Commons; House for Sale, David Smith, flickr, CreativeCommons; Fracking from Above, Allegheny Defense Project. Note that these photos are intended to illustrate therelevant concepts, not to provide editorial content or to represent any specific activity described in the report.
  • 4. Table of ContentsExecutive Summary 1Introduction 5Fracking: The Process and its Impacts 7Defining “Fracking” 7The Fracking Process 8Fracking and the New Gas/Oil Rush 10The Costs of Fracking 12Drinking Water Contamination 12Health Problems 15Damage to Natural Resources 19Impacts on Public Infrastructure and Services 24Broader Economic Impacts 29Who Pays the Costs of Fracking? 32Accounting for the True Costs of Fracking:Conclusion and Recommendations 35Notes 37
  • 5. THE COSTS OF FRACKINGThe Price Tag of Dirty Drilling’sEnvironmental Damage DAMAGE TO NATURAL RESOURCES $$ Threats to rivers and streams $$ Habitat loss and fragmentation $$ Contribution to global warming DRINKING WATER CONTAMINATION $$ Groundwater cleanup $$ Water replacement $$ Water treatment costs BROADER ECONOMIC IMPACTS $$ Value of residents’ homes at risk $$ Farms in jeopardy HEALTH PROBLEMS $$ Nearby residents getting sick $$ Worker injury, illness and death $$ Air pollution far from the wellhead PUBLIC INFRASTRUCTURE AND SERVICES $$ Road damage $$ Increased demand for water $$ Cleanup of orphaned wells $$ Emergency response needs $$ Social dislocation and social service costs $$ Earthquakes from wastewater injection Infographic design: Jenna Leschuk
  • 6. Executive SummaryO ver the past decade, the oil and gas can expect is for the oil and gas industry industry has fused two technolo- to be held accountable for the damage it gies—hydraulic fracturing and hori- causes. Such accountability must includezontal drilling—to unlock new supplies up-front financial assurances sufficient toof fossil fuels in underground rock forma- ensure that the harms caused by frackingtions across the United States. “Fracking” are fully redressed.has spread rapidly, leaving a trail of con-taminated water, polluted air, and marred Fracking damages the environment,landscapes in its wake. In fact, a growing threatens public health, and affectsbody of data indicates that fracking is an communities in ways that can imposeenvironmental and public health disaster a multitude of costs:in the making. However, the true toll of fracking does Drinking water contamination –not end there. Fracking’s negative impacts Fracking brings with it the potential foron our environment and health come with spills, blowouts and well failures that con-heavy “dollars and cents” costs as well. In taminate groundwater supplies.this report, we document those costs—rang-ing from cleaning up contaminated water to • Cleanup of drinking water contami-repairing ruined roads and beyond. Many nation is so expensive that it is rarelyof these costs are likely to be borne by the even attempted. In Dimock, Penn-public, rather than the oil and gas industry. sylvania, Cabot Oil & Gas reportedAs with the damage done by previous ex- having spent $109,000 on systems totractive booms, the public may experience remove methane from well water forthese costs for decades to come. 14 local households, while in Colo- The case against fracking is compelling rado, cleanup of an underground gasbased on its damage to the environment seep has been ongoing for eight yearsand our health alone. To the extent that at a likely cost of hundreds of thou-fracking does take place, the least the public sands of dollars, if not more. Executive Summary 
  • 7. • The provision of temporary replace- Natural resources impacts – Fracking ment water supplies is also expensive. converts rural and natural areas into indus- Cabot Oil Gas reported having trial zones, replacing forest and farm land spent at least $193,000 on replacement with well pads, roads, pipelines and other water for homes with contaminated infrastructure, and damaging precious water in Dimock, Pennsylvania. natural resources. • Fracking can also pollute drinking • The clearance of forest land in Penn- water sources for major municipal sylvania for fracking could lead to in- systems, increasing water treatment creased delivery of nutrient pollution costs. If fracking were to degrade the to the Chesapeake Bay, which already New York City watershed with sedi- suffers from a vast nutrient-generated ment or other pollution, construction dead zone. The cost of reducing the of a filtration plant would cost same amount of pollution as could be approximately $6 billion. generated by fracking would be ap- proximately $1.5 million to $4 million Health problems – Toxic substances in per year. fracking fluid and wastewater—as well as air pollution from trucks, equipment and • Gas operations in Wyoming have the wells themselves—have been linked to fragmented key habitat for mule deer a variety of negative health effects. and pronghorn, which are important draws for the state’s $340 million • The National Institute of Occupation- hunting and wildlife watching indus- al Safety and Health recently warned tries. The mule deer population in one that workers may be at elevated risk of area undergoing extensive gas extrac- contracting the lung disease silicosis tion dropped by 56 percent between from inhalation of silica dust at frack- 2001 and 2010. ing sites. Silicosis is one of a family of dust-induced occupational ailments • Fracking also produces methane that imposed $50 million medical care pollution that contributes to global costs in the United States in 2007. warming. Emissions of methane during well completion from each • Residents living near fracking sites uncontrolled fracking well impose have long suffered from a range of approximately $130,000 in social costs health problems, including headaches, related to global warming. eye irritation, respiratory problems and nausea—potentially imposing Impacts on public infrastructure and economic costs ranging from health services – Fracking strains infrastructure care costs to workplace absenteeism and public services and imposes cleanup and reduced productivity. costs that can fall on taxpayers. • Fracking and associated activities also • The truck traffic needed to deliver produce pollution that contributes water to a single fracking well causes to the formation of ozone smog and as much damage to local roads as particulate soot. Air pollution from gas nearly 3.5 million car trips. The drilling in Arkansas’ Fayetteville Shale state of Texas has approved $40 region imposed estimated public health million in funding for road repairs costs of more than $10 million in 2008. in the Barnett Shale region, while  The Costs of Fracking
  • 8. Pennsylvania estimated in 2010 Broader economic impacts – Frack- that $265 million would be needed ing can undercut the long-term economic to repair damaged roads in the prospects of areas where it takes place. A Marcellus Shale region. 2008 study found that Western counties that have relied on fossil fuel extraction• The need for vast amounts of water are doing worse economically compared for fracking is helping to drive with peer communities and are less well- demand for new water infrastructure prepared for growth in the future. in arid regions of the country. Texas’ official State Water Plan calls for • Fracking can affect the value of the expenditure of $400 million on nearby homes. A 2010 study in Texas projects to support the mining sector concluded that houses valued at more over the next 50 years, with fracking than $250,000 and within 1,000 feet projected to account for 42 percent of of a well site saw their values decrease mining water use by 2020. by 3 to 14 percent.• The oil and gas industry has left • Fracking has several negative im- thousands of orphaned wells from pacts on farms, including the loss of previous fossil fuel booms. Taxpayers livestock due to exposure to spills of may wind up on the hook for the fracking wastewater, increased dif- considerable expense of plugging and ficulty in obtaining water supplies for reclaiming orphaned wells—Cabot farming, and potential conflicts with Oil Gas claims to have spent organic agriculture. In Pennsylvania, $730,000 per well to cap three shale the five counties with the heaviest gas wells in Pennsylvania. Marcellus Shale drilling activity saw an 18.5 percent reduction in milk• Fracking brings with it increased production between 2007 and 2010. demands for public services. A 2011 survey of eight Pennsylvania counties As with previous fossil fuel booms found that 911 calls had increased in that left long-term impacts on the envi- seven of them, with the number of ronment, there is every reason to believe calls increasing in one county by 49 that the public will be stuck with the bill percent over three years. for many of the impacts of fracking. Defining “Fracking” I n this report, when we refer to the impacts of “fracking,” we include impacts resulting from all of the activities needed to bring a well into production using hydraulic fracturing, to operate that well, and to deliver the gas or oil produced from that well to market. The oil and gas industry often uses a more restrictive definition of “fracking” that includes only the actual moment in the extraction process when rock is fractured—a definition that obscures the broad changes to environmental, health and community conditions that result from the use of frack- ing in oil and gas extraction. Executive Summary 
  • 9. • Existing legal rules are inadequate of certainty required in legal to protect the public from the costs proceedings. imposed by fracking. Current bonding requirements fail to assure that The environmental, health and com- sufficient funds will be available for munity impacts of fracking are severe the proper closure and reclamation and unacceptable. Yet the dirty drilling of well sites, and do nothing at all practice continues at thousands of sites to ensure that money is available to across the nation. Wherever fracking fix other environmental problems or does occur, local, state and federal govern- compensate victims. Further, weak ments should at least: bonding requirements fail to provide an adequate incentive for drillers to • Comprehensively restrict and take steps to prevent pollution before regulate fracking to reduce its it occurs. environmental, health and community impacts as much as possible. • Current law also does little to protect against impacts that emerge over • Ensure up-front financial a long period of time, have diffuse accountability by requiring oil and impacts over a wide area, or affect gas companies to post dramatically health in ways that are difficult higher bonds that reflect the true costs to prove with the high standard of fracking.  The Costs of Fracking
  • 10. IntroductionI n Appalachia, more than 7,500 miles those who profited from the boom have of streams are polluted with acid mine left the scene. drainage—the legacy of coal mining. Today, America is in the midst of a newMany of those streams still run orange- resource extraction boom, one driven by acolored and lifeless decades after mining process colloquially known as “fracking.”ended. The ultimate cost of cleaning up In just over a decade, fracking has spreadacid mine drainage in Pennsylvania alone across the country, unlocking vast supplieshas been estimated at $5 billion.1 of previously inaccessible oil and gas from Texas has more than 7,800 orphaned underground rock formations.oil and gas wells—wells that were never The costs of fracking—in environmen-properly closed and whose owners, in many tal degradation, in illness, and in impactscases, no longer exist as functioning busi- on infrastructure and communities—areness entities.2 These wells pose a continual only just now beginning to be understoodthreat of groundwater pollution and have and tallied. It is also now becoming clearcost the state of Texas more than $247 that the nation’s current system of safe-million to plug.3 guards is incapable of protecting the public In the western United States, uranium from having to shoulder those sizable costsmining and milling have contaminated in the years and decades to come.both water and land. The cost to taxpayers The burdens imposed by fracking areof cleaning up the uranium mills has been significant, and the dangers posed to theestimated at $2.3 billion, while the cost environment and public health are great.of cleaning up abandoned mines has been If fracking is to continue, the least theestimated at $14 million per mine.4 American people should expect is for our Over and over again, throughout Ameri- laws to ensure that those who reap thecan history, short-term resource extraction benefits also bear its full costs.booms have left a dirty long-term legacy, The landscapes of Appalachia, Texas andimposing continuing costs on people and the American West are living testamentsthe environment years or decades after to the need to hold industries accountable Introduction 
  • 11. for cleaning up the damage they cause. As this history does not repeat itself in the fracking unleashes yet another extractive 21st century. boom, the time has come to ensure that  The Costs of Fracking
  • 12. Fracking: The Process and its ImpactsO ver the past decade, the oil and gas process with fewer impacts than the tech- industry has married two technolo- nology being used in oil and gas fields gies—horizontal drilling and hy- today—to create a false narrative about thedraulic fracturing—to create a potent new safety of fracking. It is only according tocombination that is being used to tap fossil this carefully constructed definition thatfuels locked in previously difficult-to-reach ExxonMobil CEO Rex Tillerson couldrock formations across the United States. say, as he did in a Congressional hearing inThis technology, known as high-volume 2011, that “[t]here have been over a millionhorizontal hydraulic fracturing—or, collo- wells hydraulically fractured in the historyquially, “fracking”—has broad implications of the industry, and there is not one, notfor the environment and public health. one, reported case of a freshwater aquifer having ever been contaminated from hy- draulic fracturing.”5 Just as only a small portion of an ice- berg is visible above the water, only aDefining “Fracking” small portion of the impacts of fracking are the direct result of fracturing rock.Public debates about fracking often de- Each step in the process of extracting oilscend into confusion and contradiction due or gas from a fracked well has impacts onto a lack of clarity about terms. To the oil the environment, public health and com-and gas industry, which seeks to minimize munities. Thus, any reasonable assessmentthe perceived impacts, “fracking” refers of fracking must include the full cycle ofonly to the actual moment in the extraction extraction operations before and after theprocess where rock is fractured by pumping moment where rock is cracked open withfluid at high pressure down the well bore. fluid under high pressure.Limiting the definition of fracking in this In this report, when we refer to theway also allows the oil and gas industry to impacts of “fracking,” we include impactsinclude its long history of using hydraulic resulting from all of the activities neededfracturing in traditional, vertical wells—a to bring a well into production using hy- Fracking: The Process and its Impacts 
  • 13. Fracking imposes a range of environmental, health and community impacts. Above, a fracking well site is built in a forested area of Wetzel County, W.Va. Credit: Robert Donnan draulic fracturing, to operate that well, and volume hydraulic fracturing used tens of to deliver the gas or oil extracted from that thousands of gallons of water per well, well to market. today’s high-volume hydraulic fractur- ing operations use millions of gallons of water, along with a different combination of sand and chemical additives, to extract gas or oil. The Fracking Process A vast amount of activity—much of it Fracking is used to unlock gas or oil with impacts on the environment and near- trapped in underground rock formations, by communities—is necessary to bring a allowing it to flow to the surface, where it fracking well into production and to deliver can be captured and delivered to market. the gas extracted from that well to market. Fracking combines hydraulic fracturing, Among those steps are the following: which uses a high-pressure mixture of wa- ter, sand and chemicals to break up under- Well Site Preparation and Road ground rock formations, with horizontal Construction drilling, which enables drillers to fracture Before drilling can begin, several acres of large amounts of rock from a single well. land must be cleared of vegetation and lev- The combination of hydraulic fractur- eled to accommodate drilling equipment, ing with horizontal drilling has magnified gas collection and processing equipment, the environmental impacts of oil and gas and vehicles. Additional land must be extraction. Whereas traditional, low- cleared for roads to the well site, as well  The Costs of Fracking
  • 14. as for any pipelines needed to deliver gas Drilling and Hydraulic Fracturingto market. Once the necessary machinery and ma- terials are assembled at the drilling site,Materials Assembly drilling can begin. The well is drilled toHydraulic fracturing requires massive the depth of the formation that is beingamounts of water, sand and chemicals—all targeted. In horizontally drilled wells, theof which must be obtained and delivered well bore is turned roughly 90 degreesto the well site. Water for fracking comes to extend along the length of the forma-either from surface waterways, groundwa- tion. Steel “casing” pipes are inserted toter or recycled wastewater from previous stabilize and contain the well, and thefracking activities, with millions of gal- casing is cemented into place. A mix oflons of water required for each well. The water, sand and chemicals is then injectedspecial grade of sand used in fracking must at high pressure—the pressure causes thebe extracted from the ground—often from rock formation to crack, with the sandsilica mines in the upper Midwest—and propping open the gaps in the rock. Sometransported to the well site. Water, sand of the injected water then flows back outand other materials must be carried to of the well when the pressure is releasedwell sites in trucks, tearing up local roads, (“flowback” water), followed by gas andcreating congestion, and producing local water from the formation (“producedlevel air pollution. water”).Equipment is put in place in preparation for hydraulic fracturing at a well site in Troy, Pa. Inhydraulic fracturing, a combination of water, sand and chemicals is injected at high pressure tofracture oil or gas-bearing rock formations deep underground. Credit: New York Departmentof Environmental Conservation Fracking: The Process and its Impacts 
  • 15. Figure 1. Shale Gas and Oil Plays6 Gas Processing and Delivery wells must be properly plugged and the As natural gas flows from the fracked land around them restored to something well, it must be collected, purified and approaching its original vegetated condi- compressed for injection into pipelines and tion. This involves plugging the well with delivery to market. cement, removing all unnecessary struc- tures from the well pad, and replanting Wastewater Management and the area. Disposal Flowback and produced water must be collected and disposed of safely. Waste- water from fracking wells is often stored onsite temporarily in retention ponds or tanks. From there, the fluid may be Fracking and the New disposed of in an underground injection Gas/Oil Rush well or an industrial wastewater treatment From its beginnings in the Barnett Shale plant, or it may be treated and re-used in region of Texas at the turn of the 21st centu- another fracking job. ry, the use of fracking has spread across the United States with breathtaking speed. A Plugging and Reclamation decade later, the combination of high-vol- To prevent future damage to the envi- ume hydraulic fracturing with horizontal ronment and drinking water supplies, drilling has been used in thousands of oil10  The Costs of Fracking
  • 16. and gas wells across the country—despite Center found that 104 day care centerspersistent questions about the impact of and 14 schools in Pennsylvania werethe technology and supporting activities located within a mile of a shale gason the environment, public health and well; that figure is certainly highercommunities. today.9 Roughy half of U.S. states, stretchingfrom New York to California, sit atop shale • In Colorado, fracking has taken offor other rock formations with the potential in the oil-producing Niobrara Shaleto produce oil or gas using fracking. As formation. Weld County, Colorado,fracking has made oil and gas extraction located just north of Denver and justviable in more of these formations, it is east of Fort Collins, has seen the per-bringing drilling closer to greater num- mitting of more than 1,300 horizontalbers of people as well as precious natural wells since the beginning of 2010.10resources. Oil and gas companies are aggressively• Between 2003 and 2010, more than seeking to expand fracking to places where 11,000 wells were drilled in the Fort more people live (including the city of Worth basin of Texas’ Barnett Shale Dallas) and to treasured natural areas (in- formation.7 The Barnett Shale under- cluding the Delaware River Basin, which lies one of the most populous regions provides drinking water for 15 million of the state—the Dallas-Fort Worth people). Wherever this new gas rush is Metroplex—and drilling has taken allowed, it will impose significant impacts place in urban and suburban neigh- on the environment, public health and borhoods of the region. communities. To add insult to injury, these impacts also come with heavy price tags• In Pennsylvania’s Marcellus Shale, that will all too often be borne by individ- more than 6,300 shale gas wells have ual residents and their communities. The been drilled since 2000; permits following section of this report provides a have been issued that would allow breakdown of fracking impacts along with for more than 2,400 additional wells examples of the real-life costs already being to be drilled.8 A 2011 analysis by imposed on America’s environment and PennEnvironment Research Policy our communities. Fracking: The Process and its Impacts  11
  • 17. The Costs of Fracking A great deal of public attention has Less dramatic, but just as important, been focused on the immediate are the long-term implications of frack- impacts of fracking on the environ- ing—including the economic burdens ment, public health and communities. imposed on individuals and communities. Images of flaming water from faucets, In this paper, we outline the many eco- stories of sickened families, and incidents nomic costs imposed by fracking and show of blowouts, spills and other mishaps have that, absent greatly enhanced mechanisms dramatically illustrated the threats posed of financial assurance, individuals, commu- by fracking. nities and states will be left to bear many of those costs. Drinking Water Contamination Fracking can pollute both groundwater and surface waterways such as rivers, lakes and streams. In rural areas, where the bulk of fracking takes place, residents may rely on groundwater for household Residents of Dimock, Pennsylvania, are among and agricultural use. Alternative sources those who have reported drinking water contami- of water—such as municipal water sup- nation in the wake of nearby fracking activity. plies—may be unavailable or prohibitively Here, discolored water from local wells illustrates expensive. the change in water quality following fracking. Fracking has polluted drinking water Photo: Hudson Riverkeeper sources in a variety of ways.12  The Costs of Fracking
  • 18. it can take years, decades or even centuries• Spills and well blowouts have released for groundwater sources to clean them- fracking chemicals and flowback or selves naturally.16 As a result, the oil and produced water to groundwater and gas industry must be held responsible for surface water. In Colorado and New restoring groundwater supplies to their Mexico, an estimated 1.2 to 1.8 per- natural condition. cent of all gas drilling projects result Methane contamination of well water in groundwater contamination.11 poses a risk of explosion and is often ad- dressed by removing it from water at the• Waste pits containing flowback and point of use. In Dimock, Pennsylvania, produced water have frequently failed. Cabot Oil Gas reported having spent In New Mexico, substances from $109,000 on meth- oil and gas pits have contaminated ane removal sys- “In Dimock, groundwater at least 421 times.12 tems for 14 local Pennsylvania, households in the Cabot Oil Gas• Faulty well construction has caused wake of drilling- reported having methane and other substances to find related methane spent $109,000 on their way into groundwater.13 contamination of methane removal local groundwater Recent studies have suggested that supplies. In addi- systems forfracking may also pose a longer-term threat tion, the company 14 households.”of groundwater contamination. One study spent $10,000 onused computer modeling to conclude that new or extended vent stacks to preventnatural faults and fractures in the Mar- the build-up of methane gas in residents’cellus Shale region could accelerate the homes.17 Such measures do not removemovement of fracking chemicals—possibly methane from groundwater supplies, butbringing these contaminants into contact merely eliminate the immediate threat towith groundwater in a matter of years.14 In residents’ homes.addition, a recent study by researchers at Removing other toxic contaminantsDuke University found evidence for the ex- from groundwater is so costly that it itistence of underground pathways between rarely attempted, with costs of hundredsthe deep underground formations tapped of thousands of dollars or more.by Marcellus Shale fracking and ground- In 2004, improper cementing of a frack-water supplies closer to the surface.15 The ing well in Garfield County, Colorado,potential for longer-term groundwater caused natural gas to vent for 55 days intocontamination from fracking is particu- a fault terminating in a surface waterway,larly concerning, as it raises the possibility West Divide Creek.18 In response to thethat contamination will become apparent leak, the company responsible for drill-only long after the drillers responsible have ing the well, Encana, engaged in regularleft the scene. testing of nearby wells and installed equip- A mong the costs that result from ment that injects air into the groundwater,drinking water contamination are the fol- enabling chemical contaminants in thelowing: water to become volatile and be removed from the water, using a process known as air sparging. These activities began in 2004Groundwater Cleanup and were still ongoing as of mid-2012.19Groundwater is a precious and often lim- The cost of groundwater remediationited natural resource. Once contaminated, in the Garfield County case is unknown, The Costs of Fracking  13
  • 19. but likely runs into the hundreds of delivery” to homes within a two-mile area thousands of dollars, if not more. A 2004 of the West Divide Creek gas seep, at an Environmental Protection Agency (EPA) estimated cost of $350,000.24 These deliv- document, referring to the work of a fed- eries continued into 2006. In Pennsylvania, eral roundtable on environmental cleanup Cabot Oil Gas provided at least $193,000 technologies, estimated the cost of air worth of water to homes affected by con- sparging at $150,000 to $350,000 per acre.20 tamination there.25 A permanent solution Adjusting for inflation, and assuming that to water issues in Dimock—the extension the extent of the seep was correctly esti- of municipal water to the neighborhood— mated by Encana at 1.3 acres, one could was estimated to cost $11.8 million.26 estimate the cost of the sparging operation in 2012 dollars at $248,000 to $579,000.21 In addition, as of May 2012, Encana and Water Treatment Costs Due to its contractors had collected more than Surface Water Contamination 1,300 water samples since the seep began.22 Fracking and related activities may reduce Again, the cost of this sampling and testing the quality of rivers and streams to the point is unknown, but could be conservatively where municipali- estimated to be in the tens of thousands of ties must invest in “Should gas dollars. Cabot Oil Gas, for example, in- additional water drilling require curred $700,000 in water testing expenses treatment in or- drinking water to in the wake of concerns about groundwater der to make water undergo additional contamination from a fracking well in Di- safe to drink. treatment, New York mock, Pennsylvania.23 The most sig- The Colorado example shows that would be required nificant impacts the process of cleaning up contaminated of fracking on riv- to build one of the groundwater can take years to complete, ers and streams world’s largest underscoring the need for protections used for drinking filtration plants at to ensure that drillers have the financial water come not an estimated cost of wherewithal to fulfill their obligations to from individual $6 billion.” clean up pollution. spills, blowouts or other accidents, but rather from the effects of fracking many wells in a given area at the Water Replacement same time. Widespread fracking can dam- As noted above, the process of cleaning up age waterways through water withdrawals contaminated groundwater can take years. from river basins, the dumping of fracking In the meantime, wastewater into rivers, or increased sedi- “Cabot Oil residents must be mentation resulting from land clearance Gas provided at provided with clean, for well pads, pipelines and other natural least $193,000 temporary sources gas infrastructure. worth of water to of drinking water. Damage from widespread fracking may homes affected by T he C olor ado require water utilities to invest in expensive contamination.” and Pennsylvania additional treatment. New York City’s wa- exa mples above ter supply, for example, comes from upstate demonst rate t he New York watersheds that are sufficiently high cost of supplying replacement water pristine that water filtration is not required. to households dependent on contami- Should gas drilling—or any other pollut- nated wells. In Colorado, Encana offered ing activity—require additional treatment, “complete water systems and potable water New York would be required to build one14  The Costs of Fracking
  • 20. The disposal of fracking wastewater in open pits contributes to air pollution, while leakage from improperlylined pits has contaminated groundwater and surface water. Chemicals present in fracking wastewaterhave been linked to serious health problems, including cancer. Credit: Mark Schmerlingof the world’s largest water filtration plants. have been linked to a variety of negativeNew York has already had to take this step health effects. Chemical components offor one major source of drinking water, fracking fluids, for example, have beenspending $3 billion to build a filtration linked to cancer, endocrine disruption,plant for the part of the watershed east of and neurological and immune systemthe Hudson River.27 The cost of doing the problems.29same for areas west of the Hudson, which The legal system often offers little re-sit atop the Marcellus Shale formation, lief for those whose health is impacted bywas estimated in 2000 to be as much as chemically tainted air or water. In order$6 billion.28 to prevail in court, an individual affected by exposure to toxic chemicals must prove that he or she has been exposed to a spe- cific toxic chemical linked to the health effects that they are experiencing and thatHealth Problems the exposure was caused by the defendantFracking produces pollu- (as opposed to the many other sourcestion that affects the health of possible exposure to toxic chemicalsof workers, nearby residents that most people experience every day).30and even people living far Meeting that high legal standard of proof isaway. Toxic substances in fracking chemi- costly—usually requiring extensive medi-cals and produced water, as well as pollu- cal and environmental testing and experttion from trucks and compressor stations, testimony—and difficult, given corporate The Costs of Fracking  15
  • 21. attorneys’ track record of exploiting gaps Residents living near fracking sites in scientific knowledge to cast doubt on have long suffered from a range of health claims of harm from toxic chemical ex- problems, including headaches, eye irrita- posures. As a result, many citizens whose tion, respiratory problems and nausea.34 health has been affected by fracking may be In western Pennsylvania, for example, discouraged from taking their complaints residents living near one fracking well site to court. have complained of rashes, blisters and Individuals and taxpayers, therefore— other health effects that they attribute to a rather than polluters—may bear much of wastewater impoundment.35 An investiga- the financial burden for health costs result- tion by the investigative journalism website ing from fracking. ProPublica uncovered numerous similar reports of illness in western states.36 A recent study by researchers at the Nearby Residents Getting Sick Colorado School of Public Health found Emissions from fracking wellsites contain that residents living within a half-mile of numerous substances that make people natural gas wells in one area of Colorado sick. were exposed to air pollutants that in- In Texas, monitoring by the Texas creased their risk of illness.37 The report Department of Environmental Quality de- noted that “health effects, such as head- tected levels of benzene—a known cancer- aches and throat and eye irritation re- causing chemical—in the air that were high ported by residents during well completion enough to cause immediate human health activities occurring in Garfield County, concern at two sites in the Barnett Shale are consistent with known health effects region, and at levels that pose long-term of many of the hydrocarbons evaluated in health concern at an additional 19 sites. this analysis.”38 Several chem- These health impacts are unacceptable “Residents living near icals were also regardless of the economic cost. But they fracking sites have long found at levels also have significant economic impacts, suffered from a range that can cause including: of health problems, foul odors. 31 including headaches, Less ex ten- • Health care costs, including inpatient, sive test i ng outpatient and prescription drug costs; eye irritation, conducted respiratory problems by the Penn- • Workplace absenteeism; and nausea—imposing sylvania De- economic costs ranging partment of • “Presenteeism,” or reduced productiv- from health care Environmen- ity at work.39 costs to workplace t a l P r ot e c - absenteeism and tion detected Major health problems such as cancer reduced productivity.” components are obviously costly. The average case of of natural gas, cancer in the United States in 2003 im- particularly methane, in the air near posed costs in treatment and lost produc- Marcellus Shale drilling operations.32 Air tivity of approximately $30,000.40 monitoring in Arkansas has also found The economic impacts of less severe elevated levels of volatile organic com- problems such as headaches and respiratory pounds (VOCs)—some of which are also symptoms can also add up quickly. Each hazardous air pollutants—at the perimeter day of reduced activity costs the economy of hydraulic fracturing sites.33 roughly $50 while a missed day of work16  The Costs of Fracking
  • 22. costs approximately $105.41 The economic is specific to fracking: inhalation of silicavalue to individuals of avoiding one ex- sand.posure to hydrocarbon odors per week is Silica sand is used to prop open theapproximately $26 to $36 per household.42 cracks formed in underground rock forma-As fracking continues to spread, particu-larly in areas close to population centers, “The National Institute of Occupationalthe number of residents affected by these Safety and Health recently warned thathealth problems—already substantial—is workers at fracking sites may be at risk oflikely to increase. contracting the lung disease silicosis from inhalation of silica dust. Silicosis is one of a family of dust-induced occupationalWorker Injury, Illness, and Death ailments that imposed $50 million inFracking is dangerous business for workers. medical care costs in 2007.”Nationally, oil and gas workers are seventimes more likely to die on the job thanother workers, with traffic accidents, death tions during fracking. As silica is movedfrom falling objects, and explosions the from trucks to the well site, silica dust canleading causes of death. Between 2003 and become airborne. Without adequate pro-2008, 648 oil and gas workers nationwide tection, workers who breathe in silica dustdied from on-the-job injuries.43 Workers at can develop an elevated risk of contractingfracking well sites are vulnerable to many silicosis, which causes swelling in the lungs,of these same dangers, as well as one that leading to the development of chronicFracking can be a dangerous business for workers. The National Institute for Occupational Safetyand Health recently found dangerous levels of airborne silica at fracking sites in several states, whileworkers also risk injury from traffic accidents, falling objects, explosions and other hazards. Workers,their families and the public often bear much of the costs of workplace illness and injury. Credit: MarkSchmerling The Costs of Fracking  17
  • 23. cough and breathing difficulty.44 Silica and those with respiratory disease. exposure can also cause lung cancer.45 Fracking produces a variety of pol- A recent investigation by the National lutants that contribute to regional air Institute for Occupational Safety and pollution problems. VOCs in natural gas Health (NIOSH) found that workers at formations contribute to the formation some fracking sites may be at risk of lung of ozone “smog,” which reduces lung disease as a result of inhaling silica dust. function among healthy people, trig- The NIOSH investigation reviewed 116 gers asthma attacks, and has been linked air samples at 11 fracking sites in Arkansas, to increases in Colorado, North Dakota, Pennsylvania school absences, “Air pollution from and Texas. Nearly half (47 percent) of the hospit a l v isit s drilling in Arkansas’ samples had levels of silica that exceeded and premature Fayetteville Shale in the Occupational Safet y and Health deat h. 4 9 S ome 2008 likely imposed Administration’s (OSHA) legal limit for VOCs are also public health costs workplace exposure, while 78 percent considered “haz- greater than exceeded OSHA’s recommended limits. ardous air pol- $10 million in 2008.” Nearly one out of 10 (9%) of the samples lutants,” which exceeded the legal limit for silica by a fac- have been linked tor of 10, exceeding the threshold at which to cancer and other serious health effects. half-face respirators can effectively protect Emissions from trucks carrying water workers.46 and materials to well sites, as well as from Silicosis is one of a family of dust-in- compressor stations and other fossil fuel- duced occupational ailments (including fired machinery, also contribute to the asbestosis and black lung disease) that have formation of smog and soot that threatens long threatened the health of industrial public health. workers. A recent study estimated that this Fracking is a significant source of category of occupational disease imposed air pollution in areas experiencing large costs in medical care alone of $50 million amounts of drilling. A 2009 study in five in 2007.47 Dallas-Fort Worth-area counties experi- Workers, their families and taxpayers encing heavy Barnett Shale drilling activity are often forced to pick up much of the cost found that oil and gas production was a of workplace illnesses and injuries. A 2012 larger source of smog-forming emissions study by researchers at the University of than cars and trucks.50 Completion of a sin- California, Davis, estimated that workers gle uncontrolled natural gas well produces compensation insurance covers only about approximately 22.7 tons of volatile organic 20 percent of the total costs of workplace compounds (VOC) per well—equivalent to illness and injury, with government pro- the annual VOC emissions of about 7,000 grams such as Medicaid and Medicare, as cars—as well as 1.7 tons of hazardous air well as workers and their families, bearing pollutants and approximately 156 tons much of the burden in health care costs and of methane, which contributes to global lost productivity.48 warming.51 Well operations, storage of natural gas liquids, and other activities related to Air Pollution Far from the fracking add to the pollution toll, playing Wellhead a significant part in regional air pollution Air pollution from fracking also threatens problems. In Arkansas, for example, gas the health of people living far from the production in the Fayetteville Shale re- wellhead—especially children, the elderly gion was estimated to be responsible for18  The Costs of Fracking
  • 24. 2.6 percent of the state’s total emissionsof nitrogen oxides (NOx).52 An analysis Damage toconducted for New York State’s revised Natural Resourcesdraft environmental impact statement Fracking threatens valu-on Marcellus Shale drilling posited that, able natural resources allin a worst case scenario of widespread across the country. Fracking converts ruraldrilling and lax emission controls, shale and natural areas into industrialized zones,gas production could add 3.7 percent to with forests and agricultural land replacedstate NOx emissions and 1.3 percent to by well pads, roads, pipelines and naturalstatewide VOC emissions compared with gas infrastructure. The effects of this2002 emissions levels.53 development are more than just aesthetic, The public health costs of pollution as economists have increasingly come tofrom fracking are significant. The fi- recognize the value of the services thatnancial impact of ozone smog on public natural systems provide to people and thehealth has been estimated at $1,648 per economy.ton of NOx and VOCs.54 Applying thosecosts to emissions in five counties of theDallas-Fort Worth region with signifi- Threats to Our Riverscant Barnett Shale drilling, the average and Streamspublic health cost of those emissions Damage to aquatic ecosystems has a direct,would be more than $270,000 per day negative impact on the economy. The lossduring the summer ozone season.55 In of a recreational or commercial fisheryArkansas, the nearly 6,000 tons of NOx due to spills, excessive withdrawals ofand VOCs emitted in 2008 would impose water, or changes in water quality causedan annual public health cost of roughly by the cumulative effects of fracking in an$9.8 million.56 area can have devastating impacts on local Various aspects of fracking also create businesses.particulate—or soot—pollution. A 2004EPA regulatory impact analysis for newstandards for stationary internal combus- “The clearance of forest land intion engines often used on natural gas Pennsylvania for fracking could leadpipelines and in oil and gas production, to increased delivery of nutrientfor example, estimated the benefit of pollution to the Chesapeake Bay,reducing one ton of particulates under which suffers from a nutrient-10 microns in diameter (PM10) at $8,028 generated dead zone. The cost ofper ton.57 Using this figure, the economic reducing an amount of pollutionbenefit of eliminating PM10 emissions equivalent to that produced byfrom Arkansas’ Fayetteville Shale would fracking would be approximately $1.5be roughly $5.4 million per year. million to $4 million per year.” Air pollution from drilling in Arkan-sas’ Fayetteville Shale in 2008, therefore,likely imposed public health costs greater In Pennsylvania, for example, fishingthan $10 million in 2008, with additional, had an estimated economic impact of $1.6unquantified costs imposed in the form billion in 2001.58 Allocating that impact toof lost agricultural production and lower the roughly 13.4 million fishing trips takenvisibility. in Pennsylvania each year (as of the late 1990s) would result in an estimated impact of $119 per trip.59 The Costs of Fracking  19
  • 25. The Monongahela River, shown here at Rices Landing, Pa., has been affected by discharges of fracking wastewater and by water withdrawals for fracking. A 2011 Army Corps of Engineers report concluded that “the quantity of water withdrawn from streams [in the Monongahela watershed] is largely unregulated and is beginning to show negative consequences.” Credit: Jonathan Dawson Spills, blowouts and other accidents Excessive water withdrawals also play related to fracking have caused numer- havoc with the ecology of rivers and ous fish kills in Pennsylvania. In 2009, a streams. In Pennsylvania, water has been pipe containing freshwater and flowback illegally withdrawn for fracking numer- water ruptured in Washington County, ous times, to the extent of streams being Pennsylvania, triggering a fish kill in a sucked dry. Two streams in southwestern tributary of Brush Run, which is part of a Pennsylvania—Sugarcamp Run and Cross high-quality watershed.60 That same year, Creek—were reportedly drained for water in the same county, another pipe rupture withdrawals, triggering fish kills.63 at a well drilled in a public park killed fish Water withdrawals also concentrate and other aquatic life along a three-quar- pollutants, reducing water quality. A 2011 ter-mile length of a local stream.61 U.S. Army Corps of Engineers study of the The clearing of land for well pads, roads Monongahela River basin of Pennsylvania and pipelines can increase sedimentation of and West Virginia concluded that, “The nearby waterways and degrade the ability quantity of water withdrawn from streams of natural landscapes to retain nutrients. A is largely unregulated and is beginning to recent preliminary study by the Academy show negative consequences.”64 The Corps of Natural Sciences of Drexel University report noted that water is increasingly found an association between increased being diverted from the relatively clean density of natural gas drilling activity streams that flow into Corps-maintained and degradation of ecologically important reservoirs, limiting the ability of the Corps headwaters streams.62 to release clean water to help dilute pollu-20  The Costs of Fracking
  • 26. tion during low-flow periods.65 It described intensive Marcellus Shale fracking activity,the water supply in the Monongahela basin creating the potential for additional pol-as “fully tapped.”66 lution that will make the bay’s pollution On a broader scale, the clearance of reduction goals more difficult to meet.forested land for well pads, roads and A rapid expansion of shale gas drillingpipelines reduces the ability of the land to could contribute an additional 30,000prevent pollution from running off into to 80,000 pounds per year of nitrogenrivers and streams. Among the waterways and 15,000 to 40,000 pounds per year ofmost affected by runoff pollution is the phosphorus to the bay, depending on theChesapeake Bay, where excessive runoff amount of forest lost.68 While this addi-of nutrients such as nitrogen and phospho- tional pollution represents a small fractionrus causes the formation of a “dead zone” of the total pollution currently reachingthat spans as much as a third of the bay in the bay, it is pollution that would need to bethe summertime.67 The Chesapeake Bay offset by reductions elsewhere in order towatershed overlaps with some of the most ensure that the Chesapeake Bay meets pol-Many waterways in the Marcellus Shale region drain into the Chesapeake Bay. The loss of forests tonatural gas development could add to pollution levels in the bay, threatening the success of state andfederal efforts to prevent the “dead zone” that affects the bay each summer. Sources: Skytruth, U.S.Energy Information Administration, Chesapeake Bay Program The Costs of Fracking  21
  • 27. of well pads drove away female mule deer in the Pinedale Mesa area of Wyoming, which was opened to fracking in 2000, and that the deer stayed away from areas near well pads over time. The study suggested that natural gas development in the area was shifting mule deer from higher quality to lower quality habitat.75 The mule deer population in the area dropped by 56 per- cent between 2001 and 2010 as fracking in the area continued and accelerated.76 Concerns have also been raised about the impact of natural gas development on pronghorn antelope. A study by the Wild- Pronghorn antelope are among the species that life Conservation Society documented have been affected by intense natural gas develop- an 82 percent reduction in high-quality ment in Wyoming. Credit: Christian Dionne pronghorn habitat in Wyoming’s natural gas fields, which have historically been key lution reduction targets designed to restore wintering grounds.77 the bay to health. 69 Based on an estimate of The Wyoming Game Fish Depart- the cost per pound of nitrogen reductions ment assigns “restitution values” for from a recent analysis of potential nutrient animals illegally killed in the state, with trading options in the Chesapeake Bay pronghorn val- watershed,70 the cost of reducing nitrogen ued at $3,000 per “The decline of pollution elsewhere to compensate for the animal and mule approximately increase from natural gas development deer at $4,000 per 2,910 mule deer would run to approximately $1.5 million animal.78 The de- in the Pinedale to $4 million per year. cline of approxi- Mesa, using this mately 2,910 mule valuation, would deer estimated to represent lost Habitat Loss and Fragmentation have occurred in value of more than Extensive natural gas development requires the Pinedale Mesa the construction of a vast infrastructure between 2001 and $11.6 million.” of roads, well pads and pipelines, often 2010, using this through remote and previously undis- valuation, would represent lost value of turbed wild lands. The disruption and more than $11.6 million, although there fragmentation of natural habitat can put is no way to determine the share of the species at risk. decline attributable to natural gas develop- Hunting and other forms of outdoor ment alone.79 recreation are economic mainstays in sev- The impact of fracking on wildlife- eral states in which fracking is taking place. based recreation is, of course, only one In Wyoming, for example, non-resident of many ways in which harm to species hunters and wildlife watchers pumped $340 translates into lasting economic dam- million into the state’s economy in 2006.73 age. Wildlife provides many important Fracking, however, is degrading the habitat ecosystem goods and services. (See next of several species that are important attrac- page.) Birds, for example, may keep insect tions for hunters and wildlife viewers.74 and rodent populations in check, help to A 2006 study found that the construction distribute seeds, and play other roles in22  The Costs of Fracking
  • 28. Loss of Ecosystem Services F orests and other natural areas provide important services—they clean our air, purify our water, provide homes to wildlife, and supply scenic beauty and rec- reational opportunities. Many of these services would be costly to replicate—for example, as noted on page 14, the natural filtration provided by the forests of upstate New York has thus far enabled New York City to avoid the $6 billion expense of building a water filtration plant to purify the city’s drinking water. In recent years, economists have worked to quantify the value of the ecosystem services provided by various types of natural land. The annual value of ecosystem services provided by deciduous and evergreen forests, for example, has been esti- mated at $300 per acre per year.71 Researchers with The Nature Conservancy and various Pennsylvania conservation groups have projected that 38,000 to 90,000 acres of Pennsylvania forest could be cleared for Marcellus shale development by 2030. The value of the ecosystem services provided by this area of forest, therefore, ranges from $11.4 million to $27 million per year.72 Widespread land clearance for fracking jeopardizes the ability of the forest to continue to provide these valuable services. Other natural features affected by fracking—including groundwater, rivers and streams, and agricultural land—provide similar natural services. The value of all of those services—and the risk that an ecosystem’s ability to deliver them will be lost—must be considered when tallying the cost of fracking.Oil and gas development fragments valuable natural habitat. Above, the Jonah gas field in Wyoming.Credit: Bruce Gordon The Costs of Fracking  23
  • 29. the maintenance of healthy ecosystems. greater than, and perhaps double, leakage Adding these impacts to the impacts on from conventional natural gas wells.82 hunters, anglers and wildlife-watchers Global warming threatens costly dis- magnifies the potential long-term costs of ruption to the environment, health and fracking from ecosystem damage. infrastructure. Economists have invested significant energy into attempting to quan- tify the “social cost” of emissions of global Contribution to Global Warming warming pollutants—that is, the negative Global warming is the most profound chal- impact on society per ton of emissions. A lenge of our time, threatening the survival 2011 EPA study estimated the social cost of of key species, the health and welfare of methane as lying within a range of $370 to human populations, and the quality of our $2,000 per ton. Each uncontrolled fracking air and water. Fracking produces pollution well produces approximately 156 tons of that contributes methane emissions.83 At a modest discount “Emissions of to the warming rate (3 percent) the social cost was $895 per methane during well of the planet in ton in 2010.84 Emissions of methane during completion from greater quanti- well completion from a single uncontrolled ties than conven- fracking well, therefore, would impose each uncontrolled tional natural gas $139,620 in social costs related to global fracking well impose extraction. warming.85 This figure does not include approximately Fr a c k i n g ’s emissions from other aspects of natural gas $139,000 in social extraction, transmission and distribution, primary impact costs related to on the climate is such as pipeline and compressor station global warming.” through the re- leaks. Leakage from those sources further lease of methane, increases the impact of fracking on the cli- which is a far more potent contributor to mate—imposing impacts that may not be global warming than carbon dioxide. Over fully realized for decades or generations. a 100-year timeframe, a pound of methane has 21 times the heat-trapping effect of a pound of carbon dioxide.80 Methane is even more potent relative to carbon dioxide at shorter timescales. Leaks during the extraction, transmis- Impacts on Public sion and distribution of natural gas release substantial amounts of methane to the Infrastructure atmosphere. Recent air monitoring near a and Services natural gas field in Colorado led researchers Fracking imposes both at the National Oceanic and Atmospheric immediate and long-term burdens on Administration and the University of taxpayers through its heavy use of public Colorado, Boulder, to conclude that about infrastructure and heavy demand for public 4 percent of the extracted gas was lost to services. the atmosphere, not counting the further losses that occur in transportation.81 Research by experts at Cornell Univer- Road Damage sity suggests that fracking is even worse for Fracking requires the transportation of the climate than conventional gas produc- massive amounts of water, sand and fracking tion. Their study finds that methane leak- chemicals to and from well sites, damaging age from fracking wells is at least 30 percent roads. In the northern tier of Pennsylvania,24  The Costs of Fracking
  • 30. Fracking requires millions of gallons of water and large quantities of sand and chemicals, all of whichmust be transported to well sites, inflicting damage on local roads. Above, a well site in WashingtonCounty, Pa. Credit: Robert Donnaneach fracking well requires approximately a regional transportation study. The study400 truck trips for the transport of water concluded that state and local governmentsand up to 25 rail cars’ worth of sand.86 The will have to repave many roads every 7 to 8process of delivering water to a single frack- years instead of every 15 years.88 ing well causes The state of Texas has convened a task “The state of Texas as much damage force to review the impact of drilling ac- has convened a task to local roads as tivity on local roads and has approved $40 force to review the nearly 3.5 mil- million in funding for road repairs in the impact of drilling lion car trips.87 Barnett Shale region.89 A 2010 Pennsylva- activity on local roads Added up nia Department of Transportation docu- and has approved across dozens ment estimated that $265 million would $40 million in funding of well sites in be required for repair of roads affected by a g iven area, Marcellus Shale drilling.90 Pennsylvania for road repairs in these transpor- has negotiated bonding requirements with the Barnett Shale tation demands natural gas companies to cover the cost of region.” are enough to repairs to local roads and some other states lead to a notice- have done the same, but these requirementsable increase in traffic—as well as strains may not cover the full impact of frack-on local roads. Between 2007 and 2010, ing on roads, including impacts on majorfor example, the amount of truck traffic on highways and the costs of traffic delaysthree major northern Pennsylvania high- and vehicle repairs caused by congested orways increased by 125 percent, according to temporarily degraded roads. The Costs of Fracking  25
  • 31. Increased Demand for Water Earthquakes The millions of gallons of water required Fracking also has the potential to affect for hydraulic fracturing come from aqui- public infrastructure through induced fers, surface waterways, or water “recycled” earthquakes resulting from underground from previous frack jobs. disposal of fracking wastewater. A recent In some areas, fracking makes up a repor t by t he significant share of overall water demand. Nat ion a l Re - “The earthquakes In 2010, for example, fracking in the Bar- search Council raise concerns about nett Shale region consumed an amount of identified eight the potential for water equivalent to 9 percent of the city of cases in which damage to public Dallas’ annual water use.91 An official at seismic events infrastructure as well the Texas Water Development Board es- were linked to as private property.” timated that one county in the Eagle Ford wastewater dis- Sh a le reg ion posal wells (not “Texas adopted a w il l see t he necessarily all for fracking wastes) in State Water Plan share of water Ohio, Arkansas and Colorado.95 In Ohio, in 2012 that calls consu mpt ion which has become a popular location for for $53 billion in devoted to the disposal of wastewater from Marcel- f rack i ng a nd lus shale drilling, more than 500 million investments in the similar activi- gallons of fracking wastewater were dis- state water system, t ie s i nc rea se posed of in underground wells in 2011.96 including $400 million f rom zero a That same year, the Youngstown, Ohio, to address unmet area experienced a series of earthquakes, few years ago needs in the mining to 40 percent prompting Ohio officials to investigate sector (which includes by 2020.92 Un- potential links between the earthquakes hydraulic fracturing).” like other uses, and a nearby injection well. While the water used in study did not determine a conclusive fracking is lost to the water cycle for- link between the injection well and the ever, as it either remains in the well, is earthquakes, it did find that “[a] number “recycled” (used in the fracking of new of coincidental circumstances appear wells), or is disposed of in deep injection to make a compelling argument for the wells, where it is unavailable to recharge recent Youngstown-area seismic events aquifers. to have been induced (by the injection Water withdrawals for fracking can well).” 97 harm local waterways (see page 20) and The earthquakes that have occurred increase costs for agricultural and mu- thus far have not caused significant dam- nicipal water consumers (see page 31). age, but they raise concerns about the po- They may also lead to calls for increased tential for damage to public infrastructure public investment in water infrastructure. (such as water and sewer lines) as well as Texas, for example, adopted a State Water private property. Plan in 2012 that calls for $53 billion in investments in the state water system, including $400 million to address unmet Cleanup of Orphaned Wells needs in the mining sector (which includes Gas and oil companies face a legal respon- hydraulic fracturing) by 2060.93 Fracking sibility to plug wells properly when they is projected to account for 42 percent of cease to be productive and to “reclaim” water use in the Texas mining sector by well sites by restoring them to something 2020.94 approaching their original vegetated26  The Costs of Fracking
  • 32. condition. The oil and gas industry, how- not rebound or if the companies cannotever, has a long track record of failing to sell off some assets to raise capital to com-clean up the messes it has made—leaving ply with statethe public to pick up the tab. environmental “A 2011 study of a Pennsylvania alone has more than protections. If Marcellus Shale well by8,000 orphaned wells drilled over the last t hat were to researchers with thecentury and a half, and the Pennsylvania happen , t he University of PittsburghDepartment of Environmental Protection state could be estimated the costis unaware of the location or status of an forced to plug of site reclamationadditional 184,000 wells.98 a nd remedi- (including reclamation Orphaned wells are not a problem of the ate the idled of retention pondspast; newer wells can be orphaned by their wells.operators, too, and left to taxpayers to clean A nother and repairs to publicup. Nearly 12,000 coal-bed methane wells way in which roads) at $500,000 toin Wyoming were idle as of 2011, neither the public may $800,000 per well site.”producing nor plugged.99 Wyoming offi- face exposurecials are concerned that several companies to costs is when a well plug fails, requiringthat operate coal-bed methane wells may attention years later. Chemical, mechanicalfile for bankruptcy if natural gas prices do or thermal stress can cause the cement toVolunteer firefighters respond to a fire in a wastewater pit at an Atlas Energy Resources well site inWashington County, Pa., in March 2010. Fracking places increased demands on emergency responders,creating new dangers that require additional training, and increasing demands for response to trafficaccidents involving heavy trucks. Credit: Robert Donnan The Costs of Fracking  27
  • 33. crack or loosen and allow contamination and repairs to public roads) at $500,000 to from saline aquifers or gas-bearing layers $800,000 per well site.104 to reach freshwater aquifers. The risk of While estimates of the costs of plug- plug failure increases over time.100 In some ging and remediation of fracked wells vary, states, such as Pennsylvania, plugging and those costs almost always exceed a state’s reclamation bonds are released one year af- bonding requirements. Pennsylvania’s re- ter a well is plugged, leaving the state with cently revised bonding requirements, for no way to hold drillers accountable for the example, require drillers to post maximum cost of plugging wells that fail later. bonds of only $4,000 per well for wells The Pennsylvania Department of Envi- less than 6,000 feet in depth and $10,000 ronmental Protection estimates that plug- per well for wells deeper than 6,000 feet, ging a 3,000 foot-deep oil or gas well and creating the potential for the public to be reclaiming the drill site costs an average saddled with tens or hundreds of thousands of $60,000.101 However, some well recla- of dollars in liability for plugging and rec- mation costs have exceeded $100,000.102 lamation of abandoned wells whose owners And Cabot Oil Gas Corporation claims have gone bankrupt or walked away from to have spent $730,000 per well to cap their responsibilities.105 The experience of three shale gas wells in Pennsylvania.103 previous resource extraction booms and A 2011 study of a Marcellus Shale well by busts suggests that the full bill for clean- researchers with the University of Pitts- ing up orphaned wells may not come due burgh estimated the cost of site reclamation for decades. (including reclamation of retention ponds In parts of the country, fracking takes place in close proximity to homes, schools and hospitals, creating the potential for conflict. A Texas study has found that some homes near fracking well sites have lost value. Above, a natural gas flare near homes in Hickory, Pa. Credit: Robert Donnan28  The Costs of Fracking
  • 34. Emergency Response Needs housing markets have driven lower incomeIncreasing traffic—especially heavy truck renters into substandard housing or home-traffic—has contributed to an increase lessness. Elderly residents have faced ain traffic accidents and fatalities in some shortage of subsidized housing.109 Requests areas in which for assistance from social service agencies “A 2011 survey in fracking has un- have increased.110 In Bradford County, eight Pennsylvania leashed a drilling Pa., the local children and youth services counties found boom, as well as agency increased its spending on housing an increase in de- subsidies by 50 percent or $10,000 per that 911 calls had mands for emer- year.111 In the same county, a government increased in seven gency response. agency purchased and distributed tents of them, with the In the Bak ken for use as temporary housing.112 In Greene number of calls Shale oil region County, in southwestern Pennsylvania, the increasing in one of North Dako- documented number of homeless jumped county by 49 percent ta for example, from zero to 40 in a single year.113 Children over three years, the number of of families that largely due to an highway crashes lose permanent “In Greene County, increase in incidents increased by 68 housing may be in southwestern involving heavy percent between at risk of being Pennsylvania, the trucks.” 2006 and 2010, separated from documented number with the share of t hei r f a m i l ie s of homeless jumped crashes involv- and placed into from zero to 40 in aing heavy trucks also increasing over that foster ca re. A single year.”period. The estimated cost of those crashes 2010 survey ofincreased by $31 million.106 Pennsylvania lo- The need to address traffic accidents is cal governments in municipalities experi-one driver of increased need for emergency encing Marcellus Shale drilling activityresponse in communities experiencing found that more governments reported anfracking. A 2011 survey by StateImpact increase in municipal expenditures sincePennsylvania in eight counties found that the onset of fracking than reported an911 calls had increased in seven of them, increase in revenues.114with the number of calls increasing in onecounty by 49 percent over three years,largely due to an increase in incidents in-volving heavy trucks.107 Broader EconomicSocial Dislocation and Social ImpactsService Costs Fracking imposes damageThe influx of temporary workers that often on the environment, publicaccompanies fracking also puts a squeeze health and public infrastructure, withon housing supplies, creating social dis- significant economic costs. But poorlylocation that, in some cases, creates new thought-out resource extraction also has ademand for government social services. legacy of undercutting the long-term eco-Rental prices have doubled or tripled in nomic prospects of the very “boomtowns”communities experiencing a boom in Mar- it creates.cellus Shale drilling.108 Overheated local A 2008 study by the firm Headwaters The Costs of Fracking  29
  • 35. Economics found that Western counties themselves from fracking-related risks. that have relied on fossil fuel extraction are Several mortgage lenders have begun to re- doing worse economically compared with quire extensive buffer zones around homes peer communities and are less well-prepared on land with gas leases before issuing a new for growth in the future, due to a less-diver- mortgage or to refuse to issue new mort- sified economy, a less-educated workforce, gages on land with natural gas leases.118 For and greater disparities in income.115 example, Brian and Amy Smith live across In addition, fracking can undermine the street from a gas drilling site in Daisy- local economies in many ways, includ- town, Pa. In the spring of 2012, Quicken ing through its impacts on housing and Loans denied their mortgage application, agriculture. stating that “Unfortunately, we are unable to move forward with this loan. It is located across the street from a gas drilling site.” Value of Residents’ Homes at Risk The Smiths were also rejected by two other Fracking can reduce the value of nearby national lenders.125 properties as a result of both actual pollu- In addition, in July 2012, Nationwide tion and the stigma that may come from Insurance issued a statement clarifying that proximity to industrial operations and its policies do not cover damages related to the potential for fracking, noting that “the exposures pre- “A 2010 study in future impacts. sented by hydraulic fracturing are too great Texas concluded that A 2010 study in to ignore.”119 Nationwide’s announcement homes valued at more Texas conclud- drew attention to the fact that standard than $250,000 and ed that homes homeowners’ insurance policies do not within 1,000 feet of valued at more cover damage related to fracking. a well site saw their than $250,000 and within 1,000 values decrease by 3 feet of a well site Farms in Jeopardy to 14 percent.” saw their values Fracking largely takes place in rural areas. decrease by 3 to Several aspects of fracking have the poten- 14 percent—there was no discernible tial to harm farmers. impact on property values beyond that Direct exposure to fracking wastewater distance or for lower-priced houses.116 A can harm livestock. Researchers at Cornell 2001 study of property values in La Plata University have identified multiple instanc- County, Colorado, found that properties es of harm to animals associated with natu- with a coalbed methane well had seen ral gas operations in Colorado, Louisiana, their sales value decrease by 22 percent.117 New York, Ohio, Pennsylvania and Texas. Even where impacts on sales values are In one case examined by the researchers, difficult to establish, chronic conditions 140 cows were caused by fracking—such as odor, traffic, ex posed when “The loss of 70 cows noise, concerns about pollution of the air t he liner of a from a single incident and water, earthquake concerns and visual wastewater im- would have an impact impacts—may adversely affect residents’ poundment was of at least $112,000.” use and enjoyment of their homes. sl it , en abl i ng Properties on and near locations where wastewater to fracking is taking place may also be more flow onto a pasture and into a pond the difficult to finance and insure, potentially cattle used as a water supply. Of those 140 affecting their value. Mortgage lenders and cows, approximately 70 died. Assuming an insurers have recently taken steps to protect average cost per cow of $1,600120, the loss of30  The Costs of Fracking
  • 36. 70 cows from a single incident would havean impact of at least $112,000. In additionto this direct replacement cost, exposureof livestock to contaminants from frackingis likely to cost farmers in other ways, forexample, by impeding the ability of animalsto reproduce or reducing the ability of afarmer to market his or her livestock. Researchers at Penn State Universityhave identified a link between increaseddrilling activity in the Marcellus Shaleand decreased production at dairy farmsin counties where drilling is taking place.The five counties in which drilling activitywas the heaviest experienced an 18.5 per- Fracking poses threats to farming, both directlycent reduction in milk production between through the potential loss of livestock due to2007 and 2010.121 The researchers did not exposure to toxic contaminants, and indirectlyreach a conclusion as to the cause of the by increasing farmers’ costs of doing businessdecline. But another review of the com- during the “boom” portion of the boom-bustmunity implications of fracking suggested cycle of development. Here, cows graze in Erie,that rising transportation costs caused by Colorado, which has experienced fracking activ-workforce competition with gas drilling ity. Credit: Jill/Blue Moonbeam Studio.has added a new economic challenge fordairy farmers.122 The demise of farmingin a community threatens to also bringdown stores and industries that were built part of 2012.123 For the 25,000 acre-feet ofto support farmers, eroding a community’s water auctioned, this would amount to aneconomic base. added cost of $700,000. In arid western states, some farmers Finally, farmers engaged in organicface higher costs for water as a result of agriculture have raised concerns that frack-competing demands from fracking. A 2012 ing could make it more difficult for themauction of unallocated water conducted by to sell their products to health-consciousthe Northern Water Conservation District consumers. One New York City food co-saw natural gas industry firms submit high op, for example, has already stated that theybids, with the average price of water sold in may stop purchasing agricultural productsthe auction increasing from $22 per acre- from New York state farms in areas wherefoot in 2010 to $28 per acre-foot in the first fracking takes place.124 The Costs of Fracking  31
  • 37. Who Pays the Costs of Fracking? T he oil and gas industry is unlikely ever do not require drillers to obtain bonds to be held accountable for many of the to cover the cost of off-site environ- costs of fracking documented in this mental remediation or compensation report—at least under current law. to victims. Time and again in the history of the oil and gas industry, legal safeguards have • Delayed appearance of harm. Some proven inadequate to protect the environ- damages from fracking are apparent ment and communities from exposure to right away—for example, the appear- long-term costs. The public can be exposed ance of tainted well water immediately to many different and significant costs from after fracking of a nearby well. But fracking for several reasons: other damages—especially ecosystem and health damages—may not appear • Inadequate financial assurance. for years or even decades, making it The boom-bust cycle typical of the likely that the individuals and com- oil and gas industry means that many panies responsible will be long gone firms (or their subcontractors) may from the scene by the time the scope be unable or unwilling to fulfill their of the damage becomes apparent. This financial obligations to properly plug is particularly worrisome given con- wells, reclaim land, remediate envi- cerns about the potential long-term ronmental problems, and compensate impact of fracking and wastewater those harmed by their activities. State disposal on precious groundwater sup- bonding requirements are intended plies. to protect the public by ensuring that financial resources exist to cover the • Diffuse, regional impacts. Some cost of well plugging and reclamation, impacts of fracking only appear when but the amounts of those bonds are many wells are drilled in a concentrat- generally too low to pay for proper ed geographic area. For example, the well closure, and state laws generally erosion caused by clearance of a single32  The Costs of Fracking
  • 38. well pad may not be enough to harm regard to health impacts. It is ex- wildlife in a local stream, but the traordinarily difficult, for example, to clearance of land for dozens of wells meet the legal standards of proof that in the same area may have a harm- an individual’s illness was caused by ful cumulative impact. In these cases, exposure to a particular toxic chemi- assigning legal responsibility for the cal at a particular time. Even where damage to any single well may prove property damage is concerned, such difficult or impossible. litigation typically requires expert analysis and testimony to prove• Inability to access legal remedies. causation and diminished value of the Those who are harmed by frack- affected property. ing can face an uphill battle in the legal system. Litigation is frequently As a result, many of the costs of fracking a lengthy, expensive, time-consum- are often borne not by the companies that ing and difficult road for citizens to benefit, but by nearby residents, taxpayers, pursue in seeking to resolve claims of those whose enjoyment of clean air, clean damage from environmental condi- water and abundant wildlife is impacted by tions. This is particularly true with fracking, and even by future generations. Who Pays the Costs of Fracking?  33
  • 39. THE COSTS OF FRACKING The Price Tag of Dirty Drilling’s Environmental Damage DAMAGE TO NATURAL RESOURCES $$ Threats to rivers and streams $$ Habitat loss and fragmentation $$ Contribution to global warming DRINKING WATER CONTAMINATION $$ Groundwater cleanup $$ Water replacement $$ Water treatment costs BROADER ECONOMIC IMPACTS $$ Value of residents’ homes at risk $$ Farms in jeopardy HEALTH PROBLEMS $$ Nearby residents getting sick $$ Worker injury, illness and death $$ Air pollution far from the wellhead PUBLIC INFRASTRUCTURE AND SERVICES $$ Road damage $$ Increased demand for water $$ Cleanup of orphaned wells $$ Emergency response needs $$ Social dislocation and social service costs $$ Earthquakes from wastewater injection Infographic design: Jenna Leschuk34  The Costs of Fracking
  • 40. Accounting for the True Costs of Fracking: Conclusion and RecommendationsF racking harms the environment, public well sites, pay for road repairs and health and our communities in many other physical damage caused by ways. fracking, remediate environmental If fracking is to continue, the mini- contamination, fully compensatemum that citizens should expect is the anyone harmed by activities at wellenforcement of tough rules to reduce sites, and address other costs im-fracking damage and up -front finan- posed by fracking. Requiring drillingcial assurances that guarantee that companies to post bonds for thesethe oil and gas industry cleans up the expenses ensures that the oil and gasdamage it does cause and compensates industry will be able to take care of itsany victims. Current laws, however, are responsibilities to the public and theinadequate to ensure that even this basic environment even amid the “boom-standard of protection is met. Failing to bust” cycles typical of the oil and gashold the oil and gas industry account- industry.able not only leaves the public exposed tomany types of costs, but it also creates a • Fees, taxes and other charges –disincentive for the industry to take action Bonding may not be the best solutionto prevent accidents and environmental for recouping every cost imposed bycontamination. fracking. For example, natural gas Federal, state and local governments companies could not be required toshould hold the oil and gas industry ac- take out bonds to cover expenses re-countable for the costs of fracking using lated to a single well’s contribution toa variety of financial tools, including: global warming—the effect of which might be felt half a world away. While• Bonding – Oil and gas companies strong regulation should be used to should be required to post bonds (or limit the broader environmental, other forms of financial assurance) public health and community impacts sufficient to plug wells and reclaim of fracking, fees and other charges can Accounting for the True Costs of Fracking: Conclusion and Recommendations  35
  • 41. also recoup for the public some of the communities is enough to spur recon- costs imposed by fracking and create sideration of when and under what cir- an economic incentive for the oil and cumstances it is permitted to take place. If gas industry to reduce its impact. fracking is permitted to continue, Ameri- cans deserve to know that the oil and gas The mounting evidence of fracking’s industry—not the public at large—will impact on our environment, health and pick up the tab.36  The Costs of Fracking
  • 42. Notes1 U.S. Geological Survey, Biology in Focus: 8 Sean D. Hamill, “Powdermill NatureNew Hope for Acid Streams, April 1998. Reserve Compiles Comprehensive List of Shale Wells,” Pipeline (blog), Pittsburgh2 Railroad Commission of Texas, Oil Field Post-Gazette, 25 May 2012.Cleanup Program, Annual Report – FiscalYear 2011, 7 February 2012. 9 Travis Madsen, Jordan Schneider and Erika Staaf, In the Shadow of the3 Dave Fehling, “Orphans of the Oil Marcellus Boom: How Shale Gas ExtractionFields: The Cost of Abandoned Wells,” Puts Vulnerable Pennsylvanians at Risk,StateImpact Texas, 25 April 2012. PennEnvironment Research Policy Center, May 2011.4 Geoffrey H. Fettus and Matthew G.McKinzie, Natural Resources Defense 10 Colorado Oil Gas ConservationCouncil, Nuclear Fuel’s Dirty Beginnings: Commission, Staff Report: July 9, 2012,Environmental Damage and Public Health downloaded from cogcc.state.co.us/Staff_Re-Risks from Uranium Mining in the American ports/2012/2012_07SR.pdf, 11 August 2012.West, March 2012. 11 Ronald E. Bishop, Chemical and5 Ian Urbina, “A Tainted Water Well, and Biological Risk Assessment for Natural GasConcern There May be More,” New York Extraction in New York, 28 March 2011.Times, 3 August 2011. 12 Joanna Prukop, “Setting the Record6 U.S. Department of Energy, Energy Straight on Pit Rule,” Farmington DailyInformation Administration, Lower 48 Times, 17 September 2008.States Shale Gas Plays, updated 9 May 2011. 13 For example, in 2007, improper7 Ed Ireland, Barnett Shale Energy Educa- cementing contributed to the infiltrationtion Council, History and Development of the of methane into several Ohio homes viaBarnett Shale: Lessons Learned (Powerpoint groundwater wells, triggering a housepresentation), downloaded from www.bar- explosion and the evacuation of 19nettshalenews.com, 3 July 2012. homes. Source: Cadmus Group, Hydraulic Notes  37
  • 43. Fracturing: Preliminary Analysis of Recently state.co.us/Library/PiceanceBasin/ Reported Contamination, prepared for U.S. WestDivideCreekSeep/Divide%20Creek% Environmental Protection Agency, September 20Report2012-03.pdf. 2009. 23 See note 17. 14 Tom Myers, “Potential Contaminant Pathways from Hydraulically Fractured 24 EnCana Oil Gas (USA), Inc., Letter Shale to Aquifers,” Ground Water, to Morris Bell, State of Colorado Oil Gas published online 17 April 2012, doi: Conservation Commission, Re: Notice of 10.1111/j.1745-6584.2012.00933.x. Alleged Violation, Schwartz 2-15B Well, 18 May 2004. 15 Nathaniel R. Warner, et al., “Geochemical Evidence for Possible 25 See note 17. Natural Migration of Marcellus Formation Brine to Shallow Aquifers in 26 The Pennsylvania Department of Envi- Pennsylvania,” Proceedings of the National ronmental Protection (DEP) had originally Academy of Sciences, 109 (30): 11961-11966, called for construction of the pipeline, to 24 July 2012, doi: 10.1073/pnas.1121181109. be paid for by Cabot. However, the DEP later drew back from that demand when it 16 U.S. Geological Survey, Groundwater negotiated a settlement with the company. Quality, downloaded from ga.water.usgs. “$11.8 million”: Pennsylvania Department gov/edu/earthgwquality.html, 11 August of Environmental Protection, Public Water 2012. Lines to Provide Safe, Permanent Water Sup- ply to Susquehanna County Residents Impacted 17 Dan O. Dinges, Cabot Oil Gas by Natural Gas Migration (news release), 30 Corporation, Letter to Pennsylvania September 2010. Department of Environmental Protection Secretary John Hanger, Exhibit B, 28 27 New York State Department of September 2010. Environmental Conservation, Revised Draft Supplemental Generic Environmental 18 Geoffrey Thyne, Science Based Solu- Impact Statement on the Oil, Gas and Solution tions, Analysis of the West Divide Creek Seep, Mining Regulatory Program: Well Permit prepared for Garfield County, undated. Issuance for Horizontal Drilling And High- Volume Hydraulic Fracturing to Develop the 19 Ibid. Marcellus Shale and Other Low-Permeability Gas Reservoirs, 7 September 2011, 6-44. 20 U.S. Environmental Protection Agency, Technologies for Treating MtBE and 28 New York City Independent Budget Other Fuel Oxygenates, May 2004. Office, The Impact of Catskill/Delaware Filtration on Residential Water and Sewer 21 Assumes that cost estimates are in 2002 Charges in New York City, November 2000. dollars, adjusted for inflation using the U.S. Bureau of Labor Statistics Consumer 29 Theo Colborn, et al., “Natural Price Index calculator, available at www. Gas Operations from a Public Health bls.gov/data/inflation_calculator.htm. Perspective,” Human and Ecological Risk Assessment: An International Journal, 17(5): 22 Rule Engineering, LLC, Memo to 1039-1056, 2011, doi: 10.1080/10807039.20 Charlie Jensen, EnCana Oil Gas, Re: 11.605662. West Divide Creek 2012 First Quarter Seep Status, Remediation #1815, 18 May 30 David E. Bernstein, “Getting to 2012, obtained from Colorado Oil Causation in Toxic Tort Cases,” Brooklyn Gas Conservation Commission at cogcc. Law Review, 74(1): 51-74, Fall 2008.38  The Costs of Fracking
  • 44. 31 Shannon Ethridge, Texas Commission 41 Calculation based on methodologyon Environmental Quality, Memorandum described in U.S. Environmental Protectionto Mark R. Vickery Re: Health Effects Review Agency, Control of Hazardous Air Pollutantsof Barnett Shale Formation Area Monitoring from Mobile Sources: Regulatory Impact Analy-Projects, 27 January 2010. sis, February 2007, with median wage data from U.S. Social Security Administration,32 Pennsylvania Department of Environ- Automatic Increases: Measures of Central Ten-mental Protection, Northeastern Pennsylva- dency for Wage Data, downloaded from www.nia Marcellus Shale Short-Term Ambient Air ssa.gov/oact/cola/central.html, 3 July 2012.Sampling Report, 12 January 2011. 42 U.S. Environmental Protection33 Arkansas Department of Agency, Final Regulatory Analysis: Control ofEnvironmental Quality, Emissions Inventory Emissions from Nonroad Diesel Engines, Mayand Ambient Air Monitoring of Natural Gas 2004. Dollar figures translated to 2012Production in the Fayetteville Shale Region, 22 dollars using the U.S. Bureau of LaborNovember 2011. Statistics CPI Inflation Calculator at www. bls.gov/data/inflation_calculator.htm.34 Texas Oil Gas Accountability Projectand Earthworks, Natural Gas Flowback: How 43 Kyla Retzer, Ryan Hill and Georgethe Texas Natural Gas Boom Affects Health A. Conway, National Institute forand Safety, April 2011. Occupational Safety and Health, Mortality Statistics for the U.S. Upstream Industry,35 Abrahm Lustgarten and Nicholas Powerpoint presentation to Society ofKusnetz, “Science Lags as Health Petroleum Engineers SPE AmericasProblems Emerge Near Gas Fields,” 2011 EP Health, Safety, Security,ProPublica, 16 September 2011. Environmental Conference, Houston, 21- 23 March 2011.36 Ibid. 44 Ebix, Inc., “Silicosis,” ADAM Medical37 L.M. McKenzie, et al., “Human Encyclopedia, accessed at PubMed Health,Health Risk Assessment of Air Emissions www.ncbi.nlm.nih.gov/pubmedhealth/from Development of Unconventional PMH0001191/, 3 July 2012.Natural Gas Resources,” Science of the TotalEnvironment, 424: 79-87, 1 May 2012. 45 U.S. Centers for Disease Control and Prevention, et al., High Impact: Silica, Lung38 Ibid. Cancer, and Respiratory Disease Quantitative Risk, downloaded from www.cdc.gov/39 Ron Z. Goetzel, et al., “Health, niosh/docs/2011-120/pdfs/2011-120.pdf, 3Absence, Disability and Presenteeism: July 2012.Cost Estimates of Certain Physical andMental Health Conditions Affecting 46 U.S. Occupational Safety and HealthU.S. Employers” Journal of Occupational Administration, Hazard Alert: Worker Ex-and Environmental Medicine, 46(4): posure to Silica During Hydraulic Fracturing,398-412, April 2004, doi: 10.1097/01. downloaded from www.osha.gov/dts/hazar-jom.0000121151.40413.bd. dalerts/hydraulic_frac_hazard_alert.html, 3 July 2012.40 Ross DeVol and Armen Bedroussian,An Unhealthy America: The Economic 47 J. Paul Leigh, “Economic Burden ofBurden of Chronic Disease, Milken Institute, Occupational Injury and Illness in theOctober 2007. Based on dividing total United States,” The Milbank Quarterly,economic impact by number of reported 89(4): 728-772, 2011. An earlier study thatcases. considered the direct and indirect costs Notes  39
  • 45. of this family of diseases (including, for emissions of VOC/reductions in VOC example, lost earnings) put the cost of due to the new regulations to arrive at an these illnesses at $381 million (1992$) in uncontrolled emission figure for hazardous 1992. Source: J. Paul Leigh, et al., Costs of air pollutants and methane. Occupational Injuries and Illnesses, University of Michigan Press, 2000. 52 See note 33. 48 UC Davis Health System, Most Occupa- 53 See note 27, 6-175. tional Injury and Illness Costs Are Paid by the Government and Private Payers Rather than 54 Michael Chan and Michael D. Jackson, Workers’ Compensation Insurance, UC Davis TIAX, for the American Lung Association in Study Shows (news release), 25 May 2012. California, Comparing the Benefits of Clean Car Regulations (Powerpoint), 4 May 2011. 49 U.S. Environmental Protection Agency, Ozone and Your Patients’ Health: Training for 55 Based on emissions estimates from note 50. Health Care Providers, downloaded from www.epa.gov/apti/ozonehealth/keypoints. 56 See note 33. html#introduction, 11 August 2012. 57 Based on an estimated benefit per ton 50 Al Armendariz, Emissions from of $6,619 in 2004 dollars, adjusted for infla- Natural Gas in the Barnett Shale Area tion using the U.S. Bureau of Labor Statis- and Opportunities for Cost-Effective tics CPI Inflation Calculator, available at Improvements, prepared for Environmental www.bls.gov/data/inflation_calculator.htm. Defense Fund, 26 January 2009. Cost per ton benefit estimate from U.S. Environmental Protection Agency, Regula- 51 VOC emissions: U.S. Environmental tory Impact Analysis for the Stationary Inter- Protection Agency, Oil and Natural Gas nal Combustion Engine (RICE) NESHAP: Sector: Standards of Performance for Crude Final Report, February 2004. Oil and Natural Gas Production, Transmission and Distribution, April 2012; “7,000 cars” 58 Pennsylvania Fish and Boat based on average emissions of 6.4 kg per Commission, Economic Value of Fishing year for vehicles of model years 2005-2008 and Boating in Pennsylvania (fact sheet), from Maureen Cropper, et al., Resources downloaded from fishandboat.com/promo/ for the Future, Getting Cars Off the Road: funding/fact_economic_impact.htm,20 The Cost-Effectiveness of an Episodic Pollution June 2012. Control Program, April 2010; Hazardous air pollutant and methane emissions based on 59 Andrew Smeltz, “Outdoor Economics,” U.S. Environmental Protection Agency, Research/Penn State, September 1999. Regulatory Impact Analysis: Final New Source Performance Standards and Amendments 60 Brian M. Dillemuth, Pennsylvania to the National Emissions Standards for Department of Environmental Protection, Hazardous Air Pollutants for the Oil and Memorandum to Jack Crook Re: Frac Water Natural Gas Industry, April 2012. Estimated Spill (Range Resources), Unnamed Tributary emissions of hazardous air pollutants and to Brush Run, Hopewell Township, Washington methane from uncontrolled wells are County, Pennsylvania, 8 October 2009. calculated based on the assumption that emissions of those pollutants are reduced 61 “Waste from Marcellus Shale Drilling by the same percentage as VOC emissions in Cross Creek Park Kills Fish,” Pittsburgh by proposed new EPA regulations. The Post-Gazette, 5 June 2009. estimated per-well emission reductions of hazardous air pollutants and methane were 62 Academy of Natural History of Drexel multiplied by the ratio of uncontrolled University, A Preliminary Study on the40  The Costs of Fracking
  • 46. Impact of Marcellus Shale Drilling on Head- Energy Impacts Assessment, Report 1:waters Streams, downloaded from www. Marcellus Shale Natural Gas and Wind, 15ansp.org/research/environmental-research/ November 2010.projects/marcellus-shale-preliminary-study/, 18 June 2012. 73 U.S. Fish and Wildlife Service and U.S. Census Bureau, 2006 National Survey63 Don Hopey, “Region’s Gas Deposits of Fishing, Hunting, and Wildlife- AssociatedReported to Be Nation’s Largest,” Recreation: Wyoming, May 2008.Pittsburgh Post-Gazette, 14 December 2008;fish kills: Katy Dunlap, Trout Unlimited, 74 Natural gas development in WyomingShale Gas Production and Water Resources in typically employs multiple, directionallythe Eastern United States: Testimony Before drilled, vertical wells from a well pad to ac-the U.S. Senate Committee on Energy and cess reservoirs of gas in underground rockNatural Resources, Subcommittee on Water formations. It does not generally involveand Power, 20 October 2011. horizontal drilling along the formations themselves. Because the impacts of this64 U.S. Army Corps of Engineers, form of natural gas extraction are similarMonongahela River Watershed Initial to those created by horizontally drilledWatershed Assessment, September 2011. wells, and are indicative of impacts that may occur in other parts of the country, we65 Ibid. include them in our discussion of the costs of fracking in this report.66 Ibid. 75 Hall Sawyer, et al., “Winter Habitat67 Maryland Department of Natural Selection of Mule Deer Before and DuringResources, Keeping Tabs on Chesapeake Bay’s Development of a Natural Gas Field,”Summer Dead Zone, late July 2012 update, Journal of Wildlife Management, 70(2): 396-downloaded from mddnr.chesapeakebay. 403, 2006.net/eyesonthebay/stories/DeadZoneSta-tus_LateJuly2012Update.pdf, 11 August 76 Hall Sawyer and Ryan Nielson, West-2012. ern Ecosystems Technology, Inc., Mule Deer Monitoring in the Pinedale Anticline68 Karl Blankenship, “Marcellus Shale Project Area: 2011 Annual Report, preparedDrilling May Take Huge Chunks out of PA for the Pinedale Anticline Planning Office,Forests,” Bay Journal, December 2011. downloaded from www.wy.blm.gov/jio- papo/papo/wildlife/meetings/2011/Mule-69 Small fraction: Chesapeake Bay deerMonitoringUpd.pdf, 29 August 2012.Program, Factors Impacting Bay andWatershed Health, downloaded from www. 77 Wildlife Conservation Society, Naturalchesapeakebay.net/track/health/factors 20 Gas Development Linked to Wildlife HabitatJune 2012. Loss (news release), 2 May 2012.70 Cy Jones, et al., World Resources 78 Wyoming Fish Game Department,Institute, How Nutrient Trading Could Help 2011 Annual Report, undated.Restore the Chesapeake Bay (working paper),2010. 79 “2,910 mule deer”: see note 76. 80 United Nations Framework Convention71 Trust for Public Land, North on Climate Change, Global Warming Po-Carolina’s Return on the Investment in Land tentials, downloaded from unfccc.int/ghg_Conservation, 2011, Appendix. data/items/3825.php, 3 July 2012.72 Nels Johnson, et al., Pennsylvania 81 Jeff Tollefson, “Air Sampling Reveals Notes  41
  • 47. High Emissions from Gas Field,” Nature, 92 Kate Galbraith, “Texas Fracking 483(7384): 139-140, 9 February 2012, doi: Disclosures to Include Water Totals,” Texas 10.1038/482139a. Tribune, 16 January 2012. 82 Robert W. Howarth, Renee Santoro 93 Texas Water Development Board, and Anthony Ingraffea, “Methane and the Water for Texas: 2012 State Water Plan, Greenhouse-Gas Footprint of Natural Gas January 2012. from Shale Formations,” Climatic Change 106 (4): 679-690, 2011, doi: 10.1007/s10584- 94 Based on projected water use for 011-0061-5. production of oil and gas from shale, tight gas and tight oil formations from Texas 83 See note 51. Water Development Board, Current and Projected Water Use in the Texas Mining and 84 Alex L. Marten and Stephen C. Oil and Gas Industry, June 2011. Newbold, U.S. Environmental Protection Agency, National Center for Environmen- 95 National Research Council, Induced Seis- tal Economics, Estimating the Social Cost micity Potential in Energy Technologies, 2012. of Non-CO2 GHG Emissions: Methane and Nitrous Oxide, January 2011. Social costs 96 Mark Niquette, “Fracking Fluid Soaks estimated at $810 per ton in 2007 dollars, Ohio,” Bloomberg Businessweek, 22 March adjusted for inflation using U.S. Bureau of 2012. Labor Statistics CPI Inflation Calculator, available at www.bls.gov/data/inflation_ 97 Ohio Department of Natural calculator.htm. Resources, Preliminary Report on the Northstar 1 Class II Injection Well and the 85 See note 51. Seismic Events in the Youngstown, Ohio, Area, March 2012. 86 Northern Tier Planning and Develop- ment Commission, Marcellus Shale Freight 98 Pennsylvania Department of Transportation Study, November 2011. Environmental Protection, Bureau of Oil and Gas Management, Pennsylvania’s Plan 87 C.J. Randall, Hammer Down: A Guide to for Addressing Problem Abandoned Wells and Protecting Local Roads Impacted by Shale Gas Orphaned Wells, 10 April 2000. Drilling, December 2010. 88 See note 86. 99 Dustin Bleizeffer, “Wyoming Betting on Coal-Bed Methane Comeback Despite 89 Jim Efstathiou, Jr., “Taxpayers Pay as Industry Bankruptcies,” WyoFile, 22 March Fracking Trucks Overwhelm Rural Cow 2011. Paths,” Bloomberg Businessweek, 15 May 2012. 100 Austin Mitchell and Elizabeth Casman, “Economic Incentives and 90 Scott Christie, Pennsylvania Department Regulatory Framework for Shale Gas of Transportation, Protecting Our Roads, testi- Well Site Reclamation in Pennsylvania,” mony before the Pennsylvania House Trans- Environmental Science and Technology, 45(22): portation Committee, 10 June 2010. 9506–9514, October 2011. 91 Jean-Philippe Nicot and Bridget 101 Ibid. R. Scanlon, “Water Use for Shale-Gas Production in Texas, U.S.,” Environmental 102 Ibid. Science and Technology, 46(6): 3580-3586, 2012, doi: 10.1021/es204602t. 103 Cabot Oil Gas Corporation, Sum- mary of Cabot’s Good Faith Efforts, down-42  The Costs of Fracking
  • 48. loaded from cabotog.com/pefs/exhibitb. nia: Employment and Income in 2009, 2011.pdf, 12 June 2012. 115 Headwaters Economics, Fossil Fuel104 William E. Hefley, et al., University Extraction as a County Economic Developmentof Pittsburgh Joseph M. Katz Graduate Strategy: Are Energy-Focused CountiesSchool of Business, The Economic Impact Benefiting?, revised 11 July 2009.of the Value Chain of a Marcellus Shale Well,August 2011. 116 Integra Realty Resources, Flower Mound Well Site Impact Study, prepared for105 Pennsylvania Session Law 2012, Feb. Town of Flower Mound (Texas), 17 August14, P.L. 87, No. 13, §3225(a)(1)(i)(A). Note, 2010.these are the maximum per-well bondingrequirements. Owners of multiple wells 117 La Plata County, La Plata Countyface lower per-well bonding requirements. Impact Report, October 2002.106 Upper Great Plains Transportation 118 Elisabeth N. Radow, “LandownersInstitute, Rural Transportation Safety and and Gas-Drilling Leases: Boom or Bust?”Security Center, ND Traffic Safety: Oil NYSBA Journal, November/December 2011.Counties (issue brief), Summer 2011. 119 Mike Tsikoudakis, “Nationwide107 Scott Detrow, “Emergency Services Mutual Insurance Responds to LeakedStretched in Pennsylvania’s Top Drilling Fracking Memo,” Business Insurance, 19 JulyCounties,” StateImpact Pennsylvania, 11 July 2012.2011. 120 Average cow size: 1,350 lbs. from Alan108 Jonathan Williamson and Bonita Kolb, Newport, “Larger Cattle Need Larger LandCenter for the Study of Community and Base,” Beef Producer, February 2010; averagethe Economy, Lycoming College, Marcellus cost (slaughter, heifer, live basis) $119 perNatural Gas Development’s Effect on Housing hundredweight from U.S. Department ofin Pennsylvania, 31 October 2011. Agriculture, USDA Market News: Daily Livestock Summary, 20 June 2012.109 Ibid. 121 Riley Adams and Timothy W. Kelsey,110 Steve Orr, “Fracking: Bane or Boon? Penn State Cooperative Extension,A Look into Industry’s Presence in Pa.,” Pennsylvania Dairy Farms and MarcellusDemocrat and Chronicle (Rochester, NY), 18 Shale, 2007-2010, 2012.December 2011. 122 Susan Christopherson and Ned Righter,111 Institute for Public Policy and Cornell University, How Should We ThinkEconomic Development, Impact on Housing About the Economic Consequences of Shale Gasin Appalachian Pennsylvania as a Result of Drilling? (working paper), May 2011.Marcellus Shale – Social Services (issue brief),November 2011. 123 Bruce Finley, “Fracking Bidders Top Farmers at Water Auction,” Denver Post, 2112 Ibid. April 2012.113 Ibid. 124 Tracy Frisch, “Farmers Get Fracked,” The Valley Table, September-November 2011.114 Timothy W. Kelsey, et al., MarcellusShale Education and Training Center, Eco- 125. Couple Denied Mortgage Because ofnomic Impacts of Marcellus Shale in Pennsylva- Gas Drilling,” WTAE.com, 8 May 2012. Notes  43