MARCELLUS SHALE
AND
HYDRAULIC FRACTURING
Drew P. Cobbs
Maryland Petroleum Council
November, 2013
Marcellus Shale in Maryland
State Distribution of the Marcellus Shale Play
State
Areal % of Marcellus
Maryland
1.09
New York
20.06
Ohio
18.19
Pennsylvania
35.35
Virginia
3.85
West Virginia
21.33
Sources: U.S. Energy Information Administration, “Review of Emerging
Resources: U.S. Shale Gas and Shale Oil Plays,” July 2011.
Marcellus Shale Formation
Shale Gas Offsets Declines in Other U.S. Natural Gas
Production Sources
Natural gas generates cleaner power.
Biomass
(Wood)
Carbon Monoxide (CO)
51
Coal
Natural Gas
Nuclear &
Renewables
5.8
1.5
0.0
Carbon Dioxide (CO2)
Low
9,362
3,558
0.0
Nitrogen Oxides (NOx)
28
3.4
0.3
0.0
Particulate Matter
2.7
0.9
0.0
0.0
Volatile Organic
Compounds (VOC)
5.6
0.2
0.0
0.0
Sulfur Dioxide (SO2)
2.8
5.0
0.2
0.0
0.0
0.0001
Tons per year per
thousand households
Mercury
Most emissions
0.0000001
Middle emissions
0.0
Least emissions
Natural gas is clean burning
Source: R.W. Beck
“The Potential Economic & Fiscal Impacts of Natural Gas Production in Western Maryland,”
study issued 3/1/12 for the Maryland Petroleum Council finds that:
•Approximately 365 wells would be operating over that period and, according to the Marcellus Shale
Education and Training Center, it requires approximately 420 individuals across 150 occupations to
bring a single Marcellus well online.
•In 2025 – the peak year of drilling activity – 1,814 Marylanders will enjoy employment opportunities
related to well drilling and maintenance, royalty payments and expanded state and local government
spending.
•Western Maryland could produce $300 million annually in natural gas output in constant $2011 by
the year 2025.
•The State of Maryland would collect $214 million in revenue over the course of developing the
Marcellus Shale play.
•Garrett County would collect approximately $162 million and Allegany County $65 million in revenue.
•Roughly $441 million in 2011 constant dollars of total positive fiscal impact would be experienced
over the course of the Western Maryland Marcellus Shale development.
• Landowner Benefits
–Signing Bonuses
–Lease Payments
–Royalties
Adequate natural gas supply at competitive prices
helps grow the U.S. economy
U.S. Industrial Demand for Natural Gas
 Lower gas prices have helped
U.S. industry
 Energy-intensive industry can
be more competitive in the
global market
 Additional potential demand
from natural gas vehicles
22
21
20
bcfd
 Chemical and fertilizer
facilities are seeing increased
utilization with lower gas
prices
23
19
18
17
16
15
2000
2005
2010
2015
2020
2025
2030
Source: Wood Mackenzie
Proper well construction provides groundwater protection
Horizontal Drilling = Lower Impact
1220 L Street, NW •
Washington, DC 20005-4070 •
www.api.org
12
Timeline of a Well
EXPLORATION
3-5 years
PLANNING
12 – 18 months
1220 L Street, NW •
Washington, DC 20005-4070 •
www.api.org
SITE & WELL
CONSTRUCTION
2-3 months
13
HYDRAULIC
FRACTURING
3 – 5 DAYS
PRODUCTION
30 + Years
Managing Risks Effectively
Records of the Pennsylvania
Department of Environmental
Protection show that from
2008 to 2010, the typical Marcellus
shale gas well generated:
$14,000 in mainly reversible
environmental impacts
$4 million in economic benefits
http://www.manhattaninstitute.org/pdf/eper_09.pdf
1220 L Street, NW •
Washington, DC 20005-4070 •
www.api.org
16
State laws are carefully tailored for
unique local concerns.
•Geology
•Hydrology
•Property Rights
•Water Laws
•Communities
1220 L Street, NW •
Washington, DC 20005-4070 •
www.api.org
17
WHAT THEY’VE SAID ABOUT HYDRAULIC FRACTURING
Former Environmental Protection Agency (EPA) Administrator: THERE IS NO “PROVEN
CASE WHERE THE FRACKING PROCESS ITSELF HAS AFFECTED WATER.” --- Lisa Jackson
+++
Environmental Protection Agency (EPA) Administrator: “I AM NOT AWARE OF ANY
DEFINITIVE DETERMINATIONS THAT WOULD CONTRADICT THOSE STATEMENTS [BY
LISA JACKSON, REFERENCED ABOVE].” --- Gina McCarthy
+++
Former Secretary of the Interior: [HYDRAULIC FRACTURING] IS CREATING AN ENERGY
REVOLUTION IN THE UNITED STATES ALONE … I WOULD SAY TO EVERYBODY THAT
HYDRAULIC FRACTURING IS SAFE” --- Ken Salazar
+++
WHAT THEY’VE SAID ABOUT HYDRAULIC FRACTURING
Secretary of Energy: “TO MY KNOWLEDGE, I STILL HAVE NOT SEEN ANY EVIDENCE OF
FRACKING, PER SE, CONTAMINATING GROUNDWATER.” --- Ernest Moniz
+++
Former U.S. Secretary of Energy: “DRILLING FOR SHALE GAS CAN BE DONE SAFELY, AND
AT LEAST ONE PROMINENT STUDY ABOUT THE RISKS IS NOT CREDIBLE … THIS IS
SOMETHING YOU CAN DO IN A SAFE WAY.”
--- Steven Chu
+++
Former Secretary of State and New York Senator: Regarding an EIA report that stated the
U.S. is on track to surpass Russia in domestic oil and gas production by the end of 2013.
“WHAT THAT MEANS FOR VIABLE MANUFACTURING AND INDUSTRIALIZATION IN THIS
COUNTRY IS ENORMOUS.”
--- Hillary Clinton
The Shale Gas End Game
ENVIRONMENTAL IMPACTS
ECONOMY
Smaller production
footprints.
U.S. energy security.
Domestic jobs.
Lower lifecycle emissions
for electricity generation
Revitalize chemical and
manufacturing sector
Lower lifecycle water use
for electricity generation.
Cheaper natural gas for
consumers.
1220 L Street, NW •
Washington, DC 20005-4070 •
www.api.org
THANK YOU
For more information visit
www.api.org
www.strongerinc.org
www.fracfocus.org
www.energyfromshale.org
To Learn More:
Drilling Video
http://www.youtube.com/watch?
v=AYQcSz27Xp8&feature=relmfu
Fracturing Video
http://www.youtube.com/watch?v=7ned5L04o8w