There are plenty of reasons to like natural gas. It’s better for the environment than fossil fuels. It lessens our dependence on foreign oil. It creates U.S. jobs at a time when Americans need them most. And, perhaps most importantly, it’s cheap.
In fact, natural gas has rarely been cheaper. At $1.92/mmbtu, natural gas spot prices have never been lower. The reason is simple: there’s so much of it right now that it keeps driving prices down. And that has everything to do with “fracking.”
“Fracking,” or “hydraulic fracturing,” is the process through which gas drillers use water, sand and chemicals to crack deep underground rocks where natural gas is stored. The recent rise in fracking has made it possible for drillers to extract gas at depths where it was previously too expensive to drill. It has allowed drillers to tap into natural gas reserves that had been lying dormant for years.
Thanks to fracking, U.S. natural-gas production is at an all-time high, churning out 1.89 trillion cubic feet per month. Everyone from environmentalists to President Obama have praised fracking, deeming it a cleaner alternative to oil.
But a new study suggests that even fracking has its drawbacks.
The U.S. Geological Survey is on the brink of confirming that fracking actually causes earthquakes. That’s right, earthquakes. New data reveals that the number of earthquakes has risen dramatically in the Midwest in recent years – and evidence suggests that wastewater wells used in fracking are to blame.
Natural gas drilling has been ramping up throughout the Midwest. That means more water is being used for fracking, and thus the wastewater wells beneath them are overflowing. Waste wells are often deeper than gas drilling wells, down where faults are more common. The extra water pressure can cause those faults to move, at times resulting in an earthquake.
The difference has been noticeable. According to the study, there were 50 earthquakes in the Midwest. Last year the number jumped to 134 earthquakes.
So far most of them are low-level quakes, registering no more than 3.0 on the Richter scale. If confirmed, however, earthquakes caused by fracking probably won’t sit well with environmentalists … or people living near these wells.
Fracking is already starting to receive a bit of backlash for its methane emissions. Just last week the Environmental Protection Agency released new rules limiting potentially cancer-causing chemicals used during fracking. One of the advantages of fracking is that it emits less carbon dioxide (CO2) emissions than coal, but some environmentalists have recently suggested that the methane emissions cancel out the lack of CO2 emissions.
Suddenly, between the earthquakes and the methane emissions, natural gas doesn’t seem as “clean” as it once did. Call it a loss of innocence.
So maybe if these environmental concerns surrounding natural gas keep cropping up, Obama’s prediction that fracking could create more than 600,000 jobs by the end of the decade might be a bit of a stretch. Perhaps the natural gas revolution isn’t on the brink of completely eradicating our reliance on foreign oil.
Natural gas still only accounts for about one-quarter of our energy usage in the U.S. Petroleum accounts for 37%. Don’t go selling those oil stocks just yet. Big oil still rules the world. We still rely heavily on foreign oil. And the natural gas boom has done little to make oil prices any cheaper – much to the chagrin of anyone who drives a gas-guzzling car.
Sure, natural gas production is rising fast. But it won’t be without obstacles. Prices are dirt cheap now; but if the EPA intervenes to curb excess water usage leading to earthquakes the way it stepped in to prevent methane emissions, production could stagnate and costs could go back up.
Most energy sources have their downsides. And it seems that natural gas is no different.