July | August 2017





Fracking Process Creating Jobs, Raising Concerns

By Nathan Dickerson, CSG Research Analyst
The town of Stanley, N.D., was a dying community of about 1,500.
But that was before the community opened up to hydrofracturing, or “fracking,” a process that pumps a solution of 99 percent water into rocks to release natural gas.
“Now that fracking has moved in, the Farmer’s Union convenience store sold over $1 million in pizza in the past year,” said North Dakota Sen. Dick Dever.  Fracking has been a huge boon to the town’s entire economy.
Yet while many states are searching for ways to attract jobs, some are hesitant to allow fracking because of environmental and other concerns.
In fracking, the water mixture is pumped into less productive wells “at pressures of up to 15,000 psi,”, which can crack open the rock at a deep level and release trapped natural gas.  While the mixture is mostly made up of water, the remaining 1 percent—particles to help keep the rock cracked—includes some chemicals.
“Many (of them) are found in household products, but some could be harmful to humans, said D. Rick Van Schoik, director of the North American Center for Transborder Studies.  In addition, he said, the U.S. Geologic Survey has found human activity can induce earthquakes. 
Van Schoick also said the use of water could pose a diplomatic problem, as it could contaminate international waters, such as the Great Lakes.
John Felmy, the chief economist for the American Petroleum Institute, emphasized that proper fracking happens at depths well below drinking water levels. Problems occur, he said, if the cement casing at higher levels isn’t done correctly.  If the cement isn’t secure, that’s when the water forced so intensely into the wells could seep into the ground at depths shallow enough to affect drinking water.
Those concerns have prompted states like New Jersey and New York to consider controversial moratoriums on the process. “You can’t unfrack,” said Van Schoik. The effects of any mistake, he said, are long-lasting.
But in a time of economic upheaval, allowing fracking for natural gas offers states an opportunity to grow much-needed jobs.
“There are people in the streets right now because of the loss of the American middle class,” said Peter Molinaro, vice president of Government Affairs at Dow Chemical Co. “There is a good vehicle to rebuild the middle class—it’s manufacturing. Affordable and stably priced energy is key to rebuilding the manufacturing industry here in the United States.”
Delaware Sen. Harris  McDowell echoed the economic frustration over energy.
“There is $1.4 trillion a year we are throwing away to bring foreign oil over here,” McDowell said.
That foreign oil is anything but stable, which companies look for when investing, said Molinaro.
“Dow invested (in the 1990s) where we could find stable energy prices, in places like Brazil,” he said. “Now, hydraulic fracturing has changed the equation. It can allow us to re-grow here.” 
Hydrocarbons, he said, are crucial chemical ingredients for a company like Dow. “If we were a bakery, natural gas would be our flour,” he said.
And everybody knows you need flour to make dough.

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