Recently, natural gas has been hailed as the new, “clean” fossil fuel and hydraulic fracturing (fracking) as the 21st century technology making it possible. This project considers Dimock, Pennsylvania, where 130 violations were filed against Cabot Oil & Gas, which leased land from locals to extract shale gas.
- Shale gas, a type of natural gas extracted from shale rock formations, accounted for 34% of U.S. natural gas produced in 2011, compared with 2% in 2000.
- Recent discoveries of shale have provided the U.S. with a steady energy source, and the potential to be a net exporter of the fossil fuel by 2020.
- The largest producer is the Marcellus Shale (See Figure 1) with 141 trillion cubic feet of recoverable gas.
Dimock, PA: A Site Description
In 2008, Cabot Oil & Gas began drilling natural gas wells in Dimock. The following year, 15 families filed a federal lawsuit against Cabot, accusing them of contaminating the water supply. The Pennsylvania Department of Environmental Protection (DEP) fined Cabot $120,000 for methane contamination, barred them from drilling in Susquehanna, and ordered them to pay for pipelines to bring water to Dimock residents. The agreement required Cabot to pay the affected families settlements of $4 million total but did not include water testing as a condition for Cabot to no longer have to provide clean water to the town. The company was required to install a water filter at residences with contaminated supplies, but some refused it, arguing that they did not clean the water of all hazardous chemicals.
The Natural Resources Defense Council (NRDC) asked the Environmental Protection Agency (EPA) to launch its own investigation of the water in Dimock. In 2012, the EPA tested water from 60+ homes, reporting dangerous amounts of barium, arsenic, and manganese. But the EPA stopped providing water, asserting that water filter systems could reduce the hazardous elements to a safe amount and that no more action was required to protect public health.
In 2013, reports surfaced that the EPA had censored the study of Dimock’s water, declaring it “safe” to drink when, in fact, long-term “damage to the water quality” was possibly the result of methane released.
Who Benefits? Who Suffers?
- Cabot paid $4 million total to the impacted families
- Cabot’s net income in 2008 was $211 million and as of 2014, their total revenue is $2 billion.
It is clear that the natural gas companies have benefitted. Perhaps the Pennsylvania economy benefitted from employment opportunities and investment in the natural resource sector, but those will be offset by the costs of cleaning the water supply and other environmental consequences of fracking.
Who was negatively impacted? Cabot told Dimock residents they could sign a gas lease to make money from their land. The company offered $25 an acre, for 5-year drilling privileges, plus royalties once production started.
- In 2009, the median household income in Dimock was $43, 343.
- The same year, the national average median income was $50, 046.
With a bad economy, 14% unemployment, and homes about to foreclose, many residents signed the lease. Craig and Julie Sautner were told that drilling would not have any impact on their land; others in Dimock were told that even if they refused to sign a lease, gas could be legally taken from their land.
This situation is not unique within Pennsylvania:
- 7,109 active wells
- 3,880 environmental regulation violations
- $5.9 million in total fines
|Operator||# of Wells||# of Violations||Fines Owed ($)|
|Cabot Oil & Gas Corp||434||487||$260,000|
|Chief Oil & Gas Llc.||223||370||$260,000|
|Range Resources Appalachia||863||227||$450,000|
Gas Companies, Wells, Violations and Fines Owed (State Impact N.D.)
|County||# of Wells||# of Violations|
Table 2: County Wells & Violations (State Impact N.D.)
In 2013, Pennsylvania enacted the Unconventional Gas Well Impact Fee Act (Act 13), focusing on “short-term economic gains through resource development while demonstrating little rigor or innovation in pursuing environmental protection”.
How does Act 13 accomplish this?
All states producing shale gas, except Pennsylvania, have implemented an energy severance tax, to offset negative environmental externalities created by oil and gas operations. The Act adopts an “unconventional gas well fee,” which is similar to a severance tax but does not result in adequate revenue except during the initial years of collection. The state government can threaten local government with revenue withdrawal in case of “noncompliance.” The apparatus responsible for deciding whether a local government has violated Act 13 is the PA Public Utility Commission, the members of which are appointed by state government and have never been involved in environmental protection.
The abilities of the local government are restrained in this legislation. Local governments are responsible for collecting fees but cannot change the rate or make decisions regarding the use of funds. The Act details uniform rules regarding well siting; shale developers support this, as it stops local governments from disputing land-use decisions. The local government cannot set regulations that treat shale gas operations differently from any other industry.
A public opinion survey demonstrated that most Pennsylvania citizens did not support Act 13.
- 91% favored required disclosure of chemicals
- 65% supported a severance tax.
- There was significant concern regarding water quality and environmental risks.
Larger U.S. Context
Public rhetoric provides a stark contrast to the line taken by the federal government. A U.S. Senate Hearing focuses on the economic benefits – jobs, decreased foreign oil dependency – but does not discuss the environmental or health risks.
- Which apparatus should be responsible for making these decisions?
- How should public opinion be taken into account?
- How can citizens trust their government as it becomes increasingly clear that they must rely upon outside organizations, like NRDC?
Fracking’s consequences are not limited by space or time. After drilling is finished, it can take six years for natural pressure balance underground to return to normal. In Ohio, there has been a noticeable increase in the amount and scale of earthquakes. A study has tied this increased seismicity to injections of wastewater from fracking operations in Pennsylvania. A 2011 spill of contaminated fluid into a Maryland creek caused anxiety there, adding to worries regarding air emissions from Pennsylvania fracking.
- As natural gas develops, some states may have strict laws and regulations, but what about others that do not?
- Pollution does not follow territorial boundaries – will we need standardized federal regulations?
Environmental Justice: The idea that “ethnic minorities … and low-income communities confront a higher burden of environmental exposure from air, water, and soil pollution from industrialization, militarization, and consumer practices” is known as environmental racism. An economic explanation of environmental racism argues industry is not intentionally discriminatory but tries to maximize profits and reduce expenses. During siting decisions, corporations place facilities where land is cheap and where there is an ample amount of industrial labor.
Dimock’s median household income is less than both state and federal income and unemployment was high when Cabot approached residents. The people of Dimock likely saw the leases as a way to make a stable living in a bad economy where agriculture and farming did not provide the same standard of living that they once did. Most landowners in the area are poor, unable to financially or politically challenge companies such as Cabot. Oil and gas companies are likely aware of these situations, so they place facilities where land is cheap and residents do not have political power to regulate companies.
Sustainability: In 2013, the DEP asserted that a high of 70% of wastewater was reused in fracking operations. Wastewater contains heavy metals and radionuclides and is hazardous to consume. However, this reduction in wastewater discharge coincided with more wastewater being transported to Ohio – 26 to 106 million gallons from 2010 to 2011. Disposal of wastewater through injection sites has been linked to increased seismicity in Ohio. The spatial fix, a mechanism by which capitalist production is extended to new places, can help prolong crises caused by capitalism or over-accumulation. This wastewater removal wastewater can be understood as spatial fix, allowing Pennsylvania to appear more environmentally conscious and permitting citizens to ignore the consequences of fracking. What happens when Ohio imposes stricter regulations on wastewater disposal? Spatial fix is not permanent.
An even worse outcome to consider – this problem is replicated throughout America. Contaminated water supplies due to fracking are becoming increasingly common in towns near drilling operations.
We consider natural gas to be a vital resource. Even with the diminishing amount and increasing pollution of water, most people do not view it as a valuable resource, unless their access to it is threatened, as in Dimock. Sustainable development dictates “the needs of the current generation [are met] without compromising the ability of future generations to meet their own needs”. Towns like Dimock do not demonstrate sustainable development; fracking compromises future generations’ access to water. Humans can survive without natural gas but cannot live without water.
Conclusion / Recommendations
The public should be aware that fracking has been shown to contribute to pollution, and of its indirect effects, like increased seismicity near injection sites. The associated externalities are not limited by state boundaries, so federal regulations may be necessary. Since local residents will mainly feel health and environmental impacts, there should be a mechanism for local input.
Governments can ignore one small town, but multiple towns involving thousands of Americans and gaining the attention of national media might be harder to overlook. Energy is important – but at what cost?
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