New Study on Water Pollution Risk from Marcellus Drilling

probabilityA new paper is about to be published in a scientific journal that will no doubt get misrepresented and widely reported in the mainstream press about assessing the risks of Marcellus Shale drilling. The paper is titled “Water Pollution Risk Associated with Natural Gas Extraction from the Marcellus Shale,” written by a graduate student and his professor at SUNY Stony  Brook. The published paper will appear in the August issue of the journal Risk Analysis, a publication of the Society for Risk Analysis (a preview copy of the full article is embedded below).

The paper looks at the theoretical probabilities of fracking fluids finding their way into the natural environment and polluting (contaminating) fresh water supplies. MDN will discuss what this paper does, and does not, say.

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Chesapeake Energy 2Q12 Update: 3.1M Acres in Marcellus/Utica

Chesapeake Energy, the second largest producer of natural gas in the U.S., released its second quarter earnings and operational update yesterday. Because of recent sales of their midstream division and other asset sales, second quarter profits for the company went up—rather dramatically. They reported a profit of $972 million, or $1.29 a share, up from $510 million a year earlier. That includes $584 million in an after-tax gain from the recent sale of Chesapeake Midstream Partners and $490 million in gains related to hedging. If you exclude the asset sales, adjusted earnings were $3 million, or 6 cents a share. Revenue increased 2.1% to $3.39 billion.

Chesapeake reports their lease holdings in the Utica Shale are now 1.3 million acres—the largest position of any driller. As of June 30, they’ve drilled 87 wells in the Utica. Chesapeake is also the largest lease holder in the Marcellus, with a whopping 1.8 million acres. They currently have 10 rigs operating in the “dry gas” portion of the Marcellus.

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NY Town with Permits wants Food Grade Fluids in Fracking

The Town of German, NY, located in Chenango County—one of the “Lucky Five” counties that may see limited fracking if Gov. Cuomo signs off on it—took a vote and sent a letter to both Gov. Cuomo and Dept. of Environmental Conservation (DEC) Commissioner Joe Martens asking them to require drillers to use “food grade fluids” when and if fracking begins. Why is that letter important for this tiny town with a population of 370?  Because three permits to drill in the Utica Shale are pending for the Town of German, and the town board’s letter to the DEC may be interpreted as a “don’t drill here” indication.

Both Com. Martens and Gov. Cuomo have stated when and if drilling permits are issued, they’ll go only to “supportive” communities. Sure sounds like German is not being all that supportive with their letter.

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Kinder Morgan Sells Tennessee Pipeline to Itself

Stories about pipelines are not very glamorous, but when the pipeline in question is one of the major pipelines that carries Marcellus Shale gas—it’s important nonetheless. This story is sort of inside baseball. Kinder Morgan, the country’s largest pipeline company, recently concluded the acquisition of another huge pipeline company—El Paso (for $21 billion). As part of the deal, for regulatory reasons, they are required to sell the Tennessee Gas Pipeline (TGP) and a half interest in the El Paso Natural Gas pipeline (EPNG). They just announced a deal to do so, selling it to Kinder Morgan Energy Partners, which is a subsidiary/related company to Kinder. So Kinder has sold a pipeline to itself, in essence.

Here’s the press release:

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