Economic realities make rush to legalize fracking a waste of time

Economic realities make rush to legalize fracking a waste of time

- in Progressive Voices

There’s something that the people and special interests pushing to legalize “fracking” in North Carolina don’t want you to know. It isn’t about flammable tap water or carcinogens in fracking fluids. It’s about the supposed rationale for putting our air and water at risk – that is, the claim by politicians and others that fracking will create near-term jobs for North Carolinians.

If you look past the rhetoric to the economics, you’ll see that their claim just isn’t true.

So far, of course, the debate about legalizing fracking has focused almost exclusively on the environmental impacts, and it’s easy to understand why. In states where the controversial method of extracting natural gas is legal, methane has leaked into drinking water, hazardous air pollutants have fouled the air, toxic fluids have contaminated aquifers, and the injection of wastewater has caused seismic activity.

With all of the focus on environmental impacts, there has been little discussion about why we would want to put our air and water at risk in the first place. Proponents say that fracking will create short-term jobs, but what if that’s not true? With so much at stake, it’s worth looking beyond the talking points and getting to the bottom of the rationale behind the push to frack.

Here’s the hard truth: If the legislature legalizes fracking, no jobs will be created in North Carolina anytime soon.

Historically low natural gas prices are making it difficult for natural gas companies to make a profit anywhere, and since North Carolina has a relatively small resource and no infrastructure in place, it wouldn’t make any sense for a natural gas company set up shop in the state.

In large part due to increased fracking in other states, a surplus of natural gas has driven natural gas prices to the lowest they’ve been in years. Just last week the price of natural gas fell to $2.08 per thousand cubic feet, the lowest it’s been in over 10 years. With prices that low and the costs of production remaining high, natural gas companies have actually had to slow down operations in areas with well-known, rich supplies of shale gas. In fact, across the country the number of rigs drilling for natural gas has fallen by 30 percent since October.

When the price of natural gas goes back up, as it surely will, companies will resume drilling in areas that have proven to be productive and already have infrastructure in place before they will come to North Carolina. Our state’s shale gas resource is tiny compared to other places across the country.

The Sanford sub-basin, where state geologists predict there might be natural gas, covers approximately 59,000 acres. Compare that to the Marcellus Shale basin, which covers 60.8 million acres across the Northeast, or the Haynesville and Barnett basins, which cover 5.8 million and 3.2 million acres across Texas, Arkansas, and Louisiana.

North Carolina also lacks the infrastructure necessary to support the natural gas industry. For a natural gas company to make a decision to invest in a new shale basin, there would need to be pipelines, processing centers, and suppliers available to get the gas to market. North Carolina doesn’t have any of that infrastructure.

You don’t have to take my word on this. Last December a respected energy research firm prepared a report for the American Natural Gas Alliance that projected natural gas production over the next two decades. The analysis revealed that more than 90 percent of shale gas production between now and 2035 will come from six different basins, and North Carolina was not on that list. Experts at the N.C. Department of Commerce agreed with this assessment, when they recently acknowledged that “it is not likely North Carolina’s shale play will be developed in the near-term.”

Looking at these numbers it’s evident that North Carolina won’t miss out on anything by keeping fracking illegal for now. On the other hand, there are big advantages to taking our time. Within a few years there will be a lot more information available about the environmental impacts of fracking. The Environmental Protection Agency is currently studying the impacts fracking has on drinking water, and in other states across the country, gas companies and state regulators are figuring out new ways to minimize environmental impacts.

A few years down the road, armed with lots of new information, North Carolina will be in a much better position to make a decision about fracking. But for now it’s clear that the potential economic benefits are not worth putting our air and water at risk.

Will Morgan is the Director of Government Relations at the North Carolina Chapter of the Sierra Club.