Energy Policy Analyst Nicolas D. Loris discusses hydraulic fracturing:

"While Americans continue to be disappointed by dismal jobs reports and a high unemployment rate, one of the few recent bright spots in the U.S. economy has been energy production, particularly the shale oil and shale gas revolution. In fact, the Yale Graduates Energy Study Group calculated that in 2010 alone, the consumer surplus (the consumer savings or gain from reductions in price) from shale gas production was worth over $100 billion. The technological one-two punch of horizontal drilling and hydraulic fracturing has created a remarkable energy boom and created hundreds of thousands of jobs in the U.S. The possibility of continuously low natural gas prices is turning the United States into a prime destination for chemical companies and other businesses that rely on abundant amounts of natural gas.

While the energy development has been substantially positive, the process of hydraulic fracturing has come under scrutiny over concerns about contamination of drinking water, the use of chemicals, wastewater management, and the potential for causing earthquakes.

All 35 of the oil and gas producing states have an impressive and long track record of regulating hydraulic fracturing, yet the federal government is proposing onerous and duplicative regulations. Congress should recognize the states’ effectiveness in regulating hydraulic fracturing and prevent federal attempts that would unreasonably slow down the success of oil and gas development.

How Does Hydraulic Fracturing Work?

Hydraulic fracturing is a process during which producers inject a fluid consisting of water, sand, and additives deep into the ground in order to free resources, including oil, natural gas, geothermal energy, and even water trapped in deep rock formations. With respect to shale gas (natural gas lodged in shale rock formations), producers drill wells that are on average 7,500 feet below the surface, thousands of feet below drinking water aquifers. After a company completes the well drilling (approximately two to four weeks), it then fractures the rock formation at high pressures that extend for several hundred feet away from the gas well. This process takes between three and five days, at which point the well will produce natural gas for 20 years to 50 years, or longer. After the drilling, the company also restores the land with soil and new vegetation, leaving only the wellhead and collection tanks. Some of the hydraulic fracturing fluid rises to the surface through steel-cased well bores and is temporarily stored in lined pits or steel tanks. Companies then recycle and reuse the wastewater or store it in an injection well deep underground.

Used in over one million wells in the United States for more than 60 years, hydraulic fracturing has been successfully used to retrieve more than 7 billion barrels of oil and over 600 trillion cubic feet of natural gas.  Just one trillion cubic feet of natural gas is enough to heat 15 million homes for one year. The development of hydraulic fracturing and horizontal drilling has increased access to proven reserves for oil and natural gas in Alabama, Arkansas, Colorado, Illinois, Louisiana, Michigan, New York, North Dakota, Oklahoma, Pennsylvania, Texas, and Wyoming.

Although geologists and energy companies have long been aware of the shale oil and shale gas reserves, the technological advancements in horizontal drilling and hydraulic fracturing are helping some regions of the country extract those resources and buck the economic downturn. In North Dakota, 4,600 wells produced 7.5 million barrels of crude oil in December 2009. In January 2012, North Dakota had 6,600 wells pumping out 16.9 million barrels of oil. In Pennsylvania, natural gas production more than quadrupled between 2009 and 2011. The oil and gas industry has created work for geologists, engineers, rig workers, truck drivers, and pipe welders. That also means a higher demand for restaurants, repair shops, hardware stores, hotels, and laundromats in those areas. Energy production could be a catalyst of economic revitalization across the country, and the hydraulic fracturing process will be essential for the development of America’s future oil and gas production.

Hydraulic fracturing: Critical for Economic Growth

Natural gas is already a critical part of America’s energy portfolio and consequently a critical part of the country’s economic growth. Not only does natural gas provide over 25 percent of electricity generation, natural gas, and other gases extracted from natural gas provide a feedstock for fertilizers, chemicals and pharmaceuticals, waste treatment, food processing, fueling industrial boilers, and much more. Although natural gas prices in the United States have historically been volatile, the abundance of shale gas brings the possibility of low, stable prices. North America has approximately 4.2 quadrillion (4,244 trillion) cubic feet of recoverable natural gas that would supply 175 years worth of natural gas at current consumption rates. Further, the National Petroleum Council estimates that hydraulic fracturing will allow 60 percent to 80 percent of all domestically drilled wells during the next 10 years to remain viable.

The abundance of natural gas makes the United States an attractive place to do business, especially for energy-intensive industries. In what could be a growing trend, Royal Dutch Shell recently announced plans to build a petrochemical plant in western Pennsylvania and cited the proximity to natural gas production as the reason for the location. The $2 billion plant will create 10,000 construction jobs and thousands of permanent jobs for Beaver County, Pennsylvania. A new KPMG analysis of the U.S. chemical industry emphasizes that “[w]ith a new and abundant source of low-cost feedstock, the US market has transformed to become one of the most advantageous markets for chemical production in the world.” Shuttered steel towns like Youngstown, Ohio, are seeing a re-emergence of manufacturing employment opportunities. In Youngstown, V&M Star, the pipe and tube producer, is building a factory to manufacture seamless pipes for hydraulic fracturing that will employ 350 people.

Hydraulic Fracturing: Facts and Myths

Despite the length of time that hydraulic fracturing has been used, and despite the fact that hydraulic fracturing has helped create a burst in American energy production and economic growth, hydraulic fracturing has received much negative attention due to misreporting and dramatic exaggerations. Much of the public’s concern over hydraulic fracturing has been over the possibility of contaminated drinking water, the chemicals used in hydraulic fracturing, the potential to create earthquakes, and wastewater management. Such concerns do not take into account the federal and state laws and regulations that address these very issues. Following are the four most prevalent myths—followed by the facts:"

READ THE REST FOR THE FACTS AND MYTHS: http://www.eidohio.org/hydraulic-fracturing-critical-for-energy-pro...