Hydraulic Fracturing Water Costs: U.S. and U.K. Strategies to Slake Fracking’s Thirst
The amount of water used in hydraulic fracturing (“fracking”) is an important issue on both sides of the Atlantic. A report by the non-profit organization Ceres cautioned that dramatic increases in natural gas production may fuel more competition and conflict over water. Policymakers, investors, and communities in the United States (“U.S.”) are also paying close attention to the demands that fracking places on state and local water supplies. In Texas, certain groundwater conservation district managers have voiced concerns that shale development will sap aquifers and streams, even though fracking’s water requirements comprises less than 1 percent of statewide water use.
The United Kingdom (“U.K.”) has been slower than the U.S. to embrace shale gas extraction, but now it is relaxing regulatory and economic burdens on fracking. British water utilities plan to offer drillers of oil and natural gas wells discounted water rates. This move would encourage the use of water for fracking and complements recent efforts to lure investment for petroleum production to the U.K. In July, the British government promised to establish the world’s “most generous tax regime” for shale gas. Prime Minister David Cameron has also appealed to the British public to embrace fracking by explaining the benefits of exploiting Britain’s shale gas reserves. Critics, however, complain that it is unfair for utilities to slash drillers’ water fees by as much as twenty-five percent below rates paid by ordinary consumers.
Their reproach may resonate even more strongly with the British public after parts of England have suffered water shortages during recent years. But fracking’s impact on Britain’s water supplies may be overstated. According to a report by the U.K.’s Tyndall Centre for Climate Change, roughly 2600 to 3000 wells are needed to produce 9 billion cubic meters of shale gas per year, roughly ten percent of national annual consumption. That level of production would require a total annual water requirement of up to 87 million cubic meters—a considerable figure to be sure, but dwarfed by the estimated 1.2 billion cubic meters lost in the U.K. in 2011 from leaking water pipes.
In the U.S., where shale development runs far ahead of the U.K., fracking depletes a relatively small fraction of states’ water stores. As mentioned above, the Texas Water Development Board’s 2012 State Water Plan projected water use for six categories—municipal, manufacturing, steam-electric, livestock, irrigation, and mining—for 2010 and 2060. The Board commissioned The University of Texas’ Bureau of Economic Geology to evaluate the amount water used in mining operations, which includes oil, gas, and coal exploration. The results of that study showed that fracturing and total mining water use comprises less than 1 percent of statewide water use, though percentages can be significantly larger in some local areas. Despite expectations that the amount of water used for fracking operations will increase through 2020, the Board predicts that mining activities will comprise just 1.3 percent of the State’s total use between 2010 and 2060.
Even so, drillers face mounting resistance from some local governments. In the summer of 2011, the City of Grand Prairie, near Fort Worth, Texas, stopped selling water to oil companies as part of its drought-contingency measures. And though oil companies currently enjoy exemptions from most Texas water rules and permitting requirements, the State is reexamining the industry’s ability to drill water wells wherever it has acquired rights to extract oil and gas.
There are encouraging signs for the pro-development camp. In January 2013, a twenty-four-member task force convened by Texas Railroad Commissioner David Porter released a report concluding that Texas’ Eagle Ford Shale contains sufficient water resources to support oil and gas drilling activities, including for fracking and other uses. The report also underscored the economic benefits of the shale play, outlining best industry practices, and offering suggestions for coping with the costs of the boom in oil and gas activity.
The U.S. and the U.K. must navigate different challenges in persuading the public and politicians to accept the increased water consumption that accompanies the shale gas industry. Prime Minister Cameron arguably has a tougher task ahead of him than his American counterparts: Britain’s geology is more complex than America’s wedding cake rock layering, which will make fracking more difficult, and the country is more densely populated, which could make it less popular. Yet shale gas can be extracted in ways that reduce demands on potable water sources, and industry and governments will both seek new ways to recycle and reuse fracking waste water in order to relieve demands on aquifers and rivers.
Posted at 10/22/2013 11:51 AM