Nov 2, 2011 3:59 PM by Rebecca Jarvis (CBS News)
(CBS News) There's a natural gas drilling boom under way in this country across 36 states. Much of that exploration is due to a horizontal drilling technique known as hydraulic fracturing, or fracking. But the drilling is not without controversy, due to safety concerns.
On "The Early Show," CBS News business and economics correspondent Rebecca Jarvis took a close look at some of those concerns.
Over the last five years, Jarvis reported, natural gas production has grown 48 percent annually, with new wells going up nearly every day. But that boom has raised concerns about the safety of ground and drinking water, and fracking's impact on our environment.
It's a debate that's playing out in town halls and legislatures across the country: whether or not to drill two centuries worth of natural gas reserves, buried thousands of feet below ground.
Five years ago, Carol French and Carolyn Knapp's families each leased their Pennsylvania dairy farms, hoping to cash in on the boom. Since 2005, 3,893 wells have been drilled in the state.
Carolyn Knapp told CBS News, "I lived here all my life, there was drilling, wells drilled in our area. And we did not see the massive trucks or the fracturing equipment, the industrial equipment that we see today."
Knapp said of the decision to drill, "It was a way that we could pay our taxes that year and be able to continue to operate, and it was just a little extra money."
But their land was never drilled. And now, French and Knapp say they're unhappy with the outcome and the long-term impact on the landscape.
Knapp said, "A lot of the land that would have years and years of agriculture use is now being turned into either a gas pad, a road or impoundment pond."
French added, "Money cannot satisfy my thirst and the money cannot keep my soil pure."
The controversy is over how the gas is extracted.
A cased vertical well is dug thousands of feet below ground and then turned horizontally. A high-pressure mix of water, sand and chemicals is then pumped into the well to break up the shale formation. And bring the gas to the surface.
In the process, traces of frack fluid filled with metals and chemicals have risen to the surface, prompting concerns about ground and drinking water contamination
French said, "We have eight wells within a mile radius of this farm. And with the activity on the last five wells, when drilling or else when fracturing the well, our water went to -- let's say putting -- a real white soap in it and it has that pearly look. It would last maybe a day or two."
Aubrey McClendon, chief executive officer of Chesapeake Energy, told CBS News, "Even the allegations of ground water contamination, you can count on one or two hands. The actual incidents we think are -- are zero."
Chesapeake Energy is the nation's second-largest natural gas producer. McClendon insists the practice is safe and vital to beating our dependence on foreign oil.
"So," Jarvis asked, "are you saying when cameras capture people who have problems with their water in their home near these fracking sites, or when they have a well that's dark and doesn't look like water anymore, that's not real?"
McClendon said, "No, it's very real and points out a huge problem, which is the lack of quality control in water wells. Anybody who has a water well, we test around us. And we find fully half of those wells do not meet EPA standards for drinking water quality. And that is the story."
Jarvis said, "You're saying you're unfairly accused?"
"Absolutely," McClendon said. "Now we have been responsible for some instances of what's called gas migration where our activities -- not fracturing, just our drilling activities -- have apparently forced some gas to the surface in people's water wells. And this has happened -- somewhere around a dozen to two dozen times."
In the HBO documentary "Gasland," homeowners in Colorado demonstrated how dangerous methane in their water supply could be.
Pennsylvania Secretary of Environmental Protection Michael Krancer tells CBS News, "If we have migration issues, and we do have one or two in the commonwealth that we're working on, we deal with it and we hold the companies responsible."
Krancer, chief regulator of natural gas exploration in Pennsylvania, says it's difficult to prove that the methane contained in drinking water is a direct result of drilling.
He said, "We've had shallow gas formations here for centuries. And that has caused, for a long, long time, the ability of methane to migrate into private water supplies, so it would not be unheard of at any time in the last 100 years for a person in our commonwealth to be able to do a dramatic lighting of their faucet on fire."
But it's not just water supplies that have been affected. In April, a Chesapeake well in Leroy, Pa., suffered a blowout. According to the Department of Environmental Protection, frac fluid spewed into the ground uninterrupted for nearly 12 hours. Its investigation found that some of the fluid "entered ... Towanda creek," which feeds the Susquehanna River.
Chesapeake Energy disputes the findings and temporarily shut down production to evaluate what went wrong.
McClendon said, "Pennsylvania has a very distinct and unique local geology, which we didn't fully understand when we started to drill, but we quickly..."
Jarvis interjected, "You understand it now?"
"Absolutely, McClendon said, "And we've worked with the -- DEP, the Department of Environmental Protection -- up there and we understand it. We've now cased our wells in a different way and -- and life moves on. And..."
Jarvis said, "So do you see it ever happening again? Or do you..."
McClendon said, "Oh, you know, look..."
Jarvis said, "Will have to..."
McClendon said, "I'll never say -- any -- anytime you do something industrially, there's always a chance that something goes wrong. ... So, I'm never going to say never. But I think we have rooted out the cause of our initial problems in Pennsylvania. And we fixed them."
Earlier this year the Obama administration ordered the Department of Energy to conduct a safety review of the industry. According to the department's August 2011 report, there are four major areas of concern: "possible pollution of drinking water...," "air pollution," "community disruption," and "adverse impacts ... on communities and ecosystems..."
McClendon said, "The report is actually pretty helpful. And I think it's great news because what they didn't say, what they didn't find, what they couldn't find is that there was some massive problem with regard to fracking."
Carolyn Knapp and Carol French disagree. They are now traveling the country to educate the public about what they describe as the potential risks and rewards of a future filled with natural gas.
Knapp said, "When you think about the possibility of waking up one morning and finding out that you can't drink your water anymore, I think that's a big impact."
Following the April blowout Chesapeake Energy hired a firm to investigate the environmental damage. It found minor impact to the land, no private water wells affected and minimal impact to the tributary and Towanda creek.The Pennsylvania Department of Energy is currently reviewing it.
Separately, just last week, the Citizens Marcellus Shale Commission issued a report asking the state of Pennsylvania to slow down new drilling permits and create stricter protections for air quality, and surface and groundwater.
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