GilmerFreePress.net

History Doesn’t Bode Well for Shale Boom

Many people within your reading area don’t consider the Marcellus extraction boom with enthusiasm.  For those with some historical perspective it is best characterized as here-we-go-again. All the state has known, except for the Ohio and Kanawah river valleys and perhaps Morgantown, is small scale farming and timber cutting and various booms. “Thank God for Mississippi,“ represents the result.

Earlier booms were manpower intensive, and left their marks on the land, which are quite obvious to those of us who live in rural areas.  Mine water, sinkholes due to the rotting away of mine timbers and degraded agriculture are the result of deep coal.  Stripping in our area was not such a catastrophe as it is in the south, but it resulted in difficult living conditions for people in areas where it occurred. Today, with “improved technology,“ it is a catastrophe for thousands, and a sink for public funds.  The original oil and gas boom perhaps did the least damage to farms and people, but stories abound of oil on the creeks, saltwater dumped down the hillsides (I can show you marks one hundred years later) and thousands of gas and oil wells pumped dry and abandoned.

Current methods of extracting natural gas from shale is not labor intensive but capital intensive, so the wages are good, but the skills are specialized, thus West Virginia natives don’t get so many jobs as they did in previous booms.  Some kinds of construction, drivers and traffic control are a conspicuous exception.  The various industries shale drilling fosters are much less labor intensive, too, although certain small local businesses are doing well.

The Gilmer Free Press


The enthusiastic claims made by Bowman and DeMarco are essentially public relations.  Let’s look at the picture from another angle.

Claims about huge reserves of gas in shale are very common, but the fact is that these are industry claims, not compared to proven reserves in the rest of the world.  If you look up proven reserves in standard references such as the Energy Information Administration, you will find the proven (meaning can be taken out with methods presently in use) reserves of natural gas are;


World                   6.845.572 Trillion Cubic Feet

Russia                   1,688                         24.6%

Iran                       1,193                         17.4%

Qatar                       885. 287                   12.9%

United states               308.436                     4.5%

Saudi Arabia               290.811                     4.2%


These are 2014 figures, except for the U. S. and world figures, which are for 2013, since 2014 data is not avaliable yet. (see reference below)

Russia has five times as much gas as the U.S., Iran has 3 and 1/2 times as much, Qatar has 2 and 1/2 as much, all of it easy and cheap to get, conventional gas.  Saudi Arabia has almost as much.  U.S. production is 24,282 Trillion Cubic Feet (2013) and Russia’s 21,358.  Next is Canada with 5,129, then China with 4,125.  In fact, U.S. production might be compared to sucking soda from a smaller cup with a larger straw.  Should the U.S. be exporting this limited resource?

Shale gas has a miserable recovery rate (the amount of gas taken out compared to the gas originally in the formation), of about 6-7%, compared to 40-50% for favorable sandstone formations and 20-40% for others.  The very best shale is being drilled now - “hot spots” high in natural gas liquids, mostly West of I-79.  What follows will be considerably less valuable.

Another characteristic of shale wells is the rapid decline. Initial production is huge compared to conventional wells, but they decline to a fraction of the original production in three to five years.  They become, in effect, stripper wells in less than a decade.  This means new wells have to be drilled very soon, with a continuing high capital cost to maintain production of the field.  This is called “the drilling treadmill.“

However, this quick return makes shale drilling very appealing to investors, they get their money back quick.  Investments in factories, roads, airports take decades to return the money.

Everywhere shale drilling goes it is hated by people in the area, central West Virginia included.  Drilling in West Virginia is largely in rural areas, enthusiasm in town.  Complaints include destroyed water wells, a horrendous array of sickness due to air and water contamination, dead livestock, conversion of large areas of surface so it can’t be used after the extraction is complete, odors from evaporating ponds and compressor stations, ugliness of the area where people live, broken roads and crowding, and many other kinds of inconvenience.  People feel they are not having basic rights protected.  That they have to give up health and property for the shale drillers.

In central West Virginia more than half of the royalty goes elsewhere, due to clever leases taken in the first oil and gas boom starting in 1880’s.  Clever leases devised this time have decreased the legal minimum royalty by subtracting various “expenses” from it.  Some cash short companies have withheld royalties, for example the suit in Doddridge County in the millions to recover royalty.

In Texas and Colorado complaints come from towns too.  Drilling goes right into the urban areas.  It will here too, if left to pursue the goal of getting all the gas it can.

Natural gas is not a bottomless pit, just as coal was not.  Should the U.S. with its huge appetite be exporting it, when there is so much elsewhere?  Is it fair to put chemicals in the air and water people count on to breathe and drink? Is it rational for so many drillers to get into production that the bottom falls out of the market?

There are a lot of reason not to like shale drilling as it is being done presently.


Sincerely,


S. Thomas Bond

1779 Jesse Run Road

Jane Lew, WV 26378



International Energy (Natural Gas) Statistics
Proved Reserves of Natural Gas (Trillion Cubic Feet) 2010 2011 2012 2013 2014
North America 347.161 378.541 412.387 393.826 NA
Bermuda 0 0 0 0 0
Canada 61.95 61.95 61.004 68.166 66.721
Greenland 0 0 0 0 0
Mexico 12.702 11.966 17.316 17.224 17.075
Saint Pierre and Miquelon 0 0 0 0 0
United States 272.509 304.625 334.067 308.436 NA
Central & South America 266.803 268.541 270.047 268.917 275.127
Antarctica 0 0 0 0 0
Antigua and Barbuda 0 0 0 0 0
Argentina 14.07 13.379 13.379 11.742 13.377
Aruba 0 0 0 0 0
Bahamas, The NA NA NA NA NA
Barbados 0.004 0.004 0.004 0.004 0.005
Belize 0 0 0 0 0
Bolivia 26.5 26.5 9.94 9.94 9.94
Brazil 12.862 12.94 14.725 13.967 13.728
Cayman Islands 0 0 0 0 0
Chile 3.46 3.46 3.46 3.46 3.46
Colombia 3.955 4 4.736 6 7.008
Costa Rica 0 0 0 0 0
Cuba 2.5 2.5 2.5 2.5 2.5
Dominica 0 0 0 0 0
Dominican Republic 0 0 0 0 0
Ecuador 0.282 0.282 0.282 0.247 0.212
El Salvador 0 0 0 0 0
Falkland Islands (Islas Malvinas) 0 0 0 0 0
French Guiana 0 0 0 0 0
Grenada 0 0 0 0 0
Guadeloupe 0 0 0 0 0
Guatemala NA NA NA NA NA
Guyana 0 0 0 0 0
Haiti 0 0 0 0 0
Honduras 0 0 0 0 0
Jamaica 0 0 0 0 0
Martinique 0 0 0 0 0
Montserrat 0 0 0 0 0
Netherlands Antilles 0 0 0 0 0
Nicaragua 0 0 0 0 0
Panama 0 0 0 0 0
Paraguay 0 0 0 0 0
Peru 11.8 12.2 12.461 12.7 15.376
Puerto Rico 0 0 0 0 0
Saint Kitts and Nevis 0 0 0 0 0
Saint Lucia 0 0 0 0 0
Saint Vincent/Grenadines 0 0 0 0 0
Suriname 0 0 NA NA NA
Trinidad and Tobago 15.4 14.416 13.46 13.257 13.11
Turks and Caicos Islands 0 0 0 0 0
Uruguay 0 0 0 0 0
Venezuela 175.97 178.86 195.1 195.1 196.411
Virgin Islands, U.S. 0 0 0 0 0
Virgin Islands, British 0 0 0 0 0
Europe 166.314 153.822 146.942 145.52 142.151
Albania 0.03 0.03 0.03 0.03 0.03
Austria 0.57 0.57 0.57 0.382 0.341
Belgium 0 0 0 0 0
Bosnia and Herzegovina 0 0 0 0 0
Bulgaria 0.2 0.2 0.2 0.2 0.2
Croatia 1.08 0.88 0.88 0.88 0.88
Cyprus 0 0 0 0 0
Czech Republic 0.14 0.14 0.14 0.14 0.151
Denmark 2.165 2.053 1.836 1.518 1.519
Faroe Islands 0 0 0 0 0
Finland 0 0 0 0 0
Former Czechoslovakia
Former Serbia and Montenegro
Former Yugoslavia
France 0.25 0.24 0.195 0.378 0.341
Germany 6.2 6.2 6.2 4.414 4.096
Germany, East
Germany, West
Gibraltar 0 0 0 0 0
Greece 0.035 0.035 0.035 0.035 0.035
Hungary 0.286 0.286 0.283 0.286 0.277
Iceland 0 0 0 0 0
Ireland 0.35 0.35 0.35 0.35 0.35
Italy 2.466 2.245 2.331 2.202 2.099
Luxembourg 0 0 0 0 0
Macedonia 0 0 0 0 0
Malta 0 0 0 0 0
Montenegro 0 0 0 0 0
Netherlands 50 49 46 43.436 39.905
Norway 81.68 72 70.87 73.1 73.806
Poland 5.82 5.82 3.355 3.249 3.249
Portugal 0 0 0 0 0
Romania 2.225 2.225 2.225 3.725 3.725
Serbia 1.7 1.7 1.7 1.7 1.7
Slovakia 0.5 0.5 0.5 0.5 0.5
Slovenia 0 0 0 0 0
Spain 0.09 0.09 0.09 0.09 0.09
Sweden 0 0 0 0 0
Switzerland NA NA NA NA NA
Turkey 0.215 0.218 0.218 0.218 0.241
United Kingdom 10.312 9.04 8.934 8.687 8.616
Eurasia 2164.8 2164.8 2164.8 2177.8 2177.8
Armenia 0 0 0 0 0
Azerbaijan 30 30 30 35 35
Belarus 0.1 0.1 0.1 0.1 0.1
Estonia 0 0 0 0 0
Former U.S.S.R.
Georgia 0.3 0.3 0.3 0.3 0.3
Kazakhstan 85 85 85 85 85
Kyrgyzstan 0.2 0.2 0.2 0.2 0.2
Latvia 0 0 0 0 0
Lithuania 0 0 0 0 0
Moldova 0 0 0 0 0
Russia 1680 1680 1680 1688 1688
Tajikistan 0.2 0.2 0.2 0.2 0.2
Turkmenistan 265 265 265 265 265
Ukraine 39 39 39 39 39
Uzbekistan 65 65 65 65 65
Middle East 2658.273 2686.373 2799.977 2823.234 2828.082
Bahrain 3.25 3.25 3.25 3.25 3.25
Iran 1045.67 1045.67 1168 1187 1193
Iraq 111.94 111.94 111.52 111.52 111.522
Israel 1.075 7 9.559 9.482 10.064
Jordan 0.213 0.213 0.213 0.213 0.213
Kuwait 63.5 63.5 63.5 63.5 63.5
Lebanon 0 0 0 0 0
Oman 30 30 30 30 30
Palestinian Territories 0 0 0 0 0
Qatar 899.325 895.8 890 890 885.287
Saudi Arabia 263.5 275.7 283.5 287.844 290.811
Syria 8.5 8.5 8.5 8.5 8.5
United Arab Emirates 214.4 227.9 215.035 215.025 215.035
Yemen 16.9 16.9 16.9 16.9 16.9
Africa 496.165 518.551 510.357 514.811 605.955
Algeria 159 159 159 159.05 159.1
Angola 9.6 10.94 10.947 12.925 9.711
Benin 0.04 0.04 0.04 0.04 0.04
Botswana 0 0 0 0 0
Burkina Faso 0 0 0 0 0
Burundi 0 0 0 0 0
Cameroon 4.77 4.77 4.77 4.77 4.77
Cape Verde 0 0 0 0 0
Central African Republic 0 0 0 0 0
Chad 0 0 0 0 0
Comoros 0 0 0 0 0
Congo (Brazzaville) 3.2 3.2 3.2 3.2 3.2
Congo (Kinshasa) 0.035 0.035 0.035 0.035 0.035
Cote dIvoire (IvoryCoast) 1 1 1 1 1
Djibouti 0 0 0 0 0
Egypt 58.5 77.2 77.2 77.2 77.2
Equatorial Guinea 1.3 1.3 1.3 1.3 1.3
Eritrea 0 0 0 0 0
Ethiopia 0.88 0.88 0.88 0.88 0.88
Gabon 1 1 1 1 1
Gambia, The 0 0 0 0 0
Ghana 0.8 0.8 0.8 0.8 0.8
Guinea 0 0 0 0 0
Guinea-Bissau 0 0 0 0 0
Kenya 0 0 0 0 0
Lesotho 0 0 0 0 0
Liberia 0 0 0 0 0
Libya 54.362 54.68 52.795 54.63 54.701
Madagascar 0.071 0.071 0.071 NA NA
Malawi 0 0 0 0 0
Mali 0 0 0 0 0
Mauritania 1 1 1 1 1
Mauritius 0 0 0 0 0
Morocco 0.053 0.051 0.051 0.051 0.051
Mozambique 4.5 4.5 4.5 4.5 100
Namibia 2.2 2.2 2.2 2.2 2.2
Niger 0 0 0 0 0
Nigeria 185.28 186.88 180.458 182 180.737
Reunion 0 0 0 0 0
Rwanda 2 2 2 2 2
Saint Helena 0 0 0 0 0
Sao Tome and Principe 0 0 0 0 0
Senegal 0.35 0.35 0.35 0 0
Seychelles 0 0 0 0 0
Sierra Leone 0 0 0 0 0
Somalia 0.2 0.2 0.2 0.2 0.2
South Africa 0.494 0.424 0.53 NA NA
Sudan and South Sudan 3 3 3 3 3
Swaziland 0 0 0 0 0
Tanzania 0.23 0.23 0.23 0.23 0.23
Togo 0 0 0 0 0
Tunisia 2.3 2.3 2.3 2.3 2.3
Uganda 0 0.5 0.5 0.5 0.5
Western Sahara 0 0 0 0 0
Zambia 0 0 0 0 0
Zimbabwe 0 0 0 0 0
Asia & Oceania 538.669 537.562 504.75 521.464 539.203
Afghanistan 1.75 1.75 1.75 1.75 1.75
American Samoa 0 0 0 0 0
Australia 110 110 27.85 43.037 43.037
Bangladesh 6.9 6.9 6.489 6.489 9.344
Bhutan 0 0 0 0 0
Brunei 13.8 13.8 13.8 13.8 13.8
Burma (Myanmar) 10 10 10 10 10
Cambodia 0 0 0 0 0
China 107 107 107 141.256 155.382
Cook Islands 0 0 0 0 0
Fiji 0 0 0 0 0
French Polynesia 0 0 0 0 0
Guam 0 0 0 0 0
Hawaiian Trade Zone
Hong Kong 0 0 0 0 0
India 37.96 37.928 40.745 43.825 46.968
Indonesia 106 106 141.06 108.4 104.37
Japan 0.738 0.738 0.738 0.738 0.738
Kiribati 0 0 0 0 0
Korea, North 0 0 0 0 0
Korea, South 0.071 0.035 0.25 0.186 0.203
Laos 0 0 0 0 0
Macau 0 0 0 0 0
Malaysia 83 83 83 83 83
Maldives 0 0 0 0 0
Mongolia 0 0 0 0 0
Nauru 0 0 0 0 0
Nepal 0 0 0 0 0
New Caledonia 0 0 0 0 0
New Zealand 1.2 1.214 0.976 1.039 1.039
Niue 0 0 0 0 0
Pakistan 29.671 29.671 26.62 24.001 26.65
Papua New Guinea 8 8 5.483 5.483 5.483
Philippines 3.48 3.48 3.48 3.48 3.48
Samoa 0 0 0 0 0
Singapore 0 0 0 0 0
Solomon Islands 0 0 0 0 0
Sri Lanka 0 0 0 0 0
Taiwan 0.22 0.22 0.22 0.22 0.22
Thailand 12.079 11.026 10.589 10.06 9.039
Timor-Leste (East Timor) 0 0 0 0 0
Tonga 0 0 0 0 0
U.S. Pacific Islands 0 0 0 0 0
Vanuatu 0 0 0 0 0
Vietnam 6.8 6.8 24.7 24.7 24.7
Wake Island 0 0 0 0 0
World 6638.185 6708.19 6809.26 6845.572 NA
Click Below for additional Articles...

Page 1 of 1 pages





The Gilmer Free Press

Copyright MMVIII-MMXIVIII The Gilmer Free Press. All Rights Reserved