Frac’ing Makes Positive Impact in Eagle Ford Shale Region

Forecasts for Texas to see increased oil and gas frac'ing in the Eagle Ford Shale Region is a credit positive for a total of 21 counties, cities and school districts, Moody's Investors Service said on Tuesday.

According to the university study, "…oil production in 2011 increased nearly seven times over 2010 production and gas production more than doubled."

Moody's, which left general obligation bond ratings unchanged for the 21 counties, cities, and school districts, reports a sharp increase in revenues.

"Sales tax growth for rated issuers in the 14-county production region has outpaced the total sales tax growth for all cities across Texas," the report says.

The Moody's report is based on a May study by the University of Texas at San Antonio's Institute for Economic Development, which estimated that the rise in frac'ing will create 38,000 full-time jobs, $211 million in local government revenues, and $312 million in state revenues for the 14 counties that are directly affected.

The Facts Behind Frac’ing

Many arguments that are anti-frac'ing fall flat in the face of facts (or lack thereof). The Consumer Energy Alliance, a tireless advocate for the economic benefits that domestic energy production brings, has recently provided the studies needed to back these arguments up.

Last week, a series of reports confirmed just how significant energy production can have on the economy.  In South Texas, increased activity in the Eagle Ford Shale last year contributed over $25 billion in economic impact.  This translates to 47,000 new jobs in the twenty-county region as well as $615 million in state and local tax revenue.  The Center for Community and Business Research at the University of Texas at San Antonio study further concluded that South Texas has only seen the start of an economic boom.  Within the next decade, the Eagle Ford will support 117,000 full-time jobs.

Meanwhile in Pennsylvania and West Virginia, the Marcellus Shale has similarly led to huge economic gains.  Even with natural gas prices reaching new lows this year, Marcellus shale development generated about $4.7 billion in revenues for drillers, of which about $400 million went to property owners in the Keystone state. The Associated Press adds that, despite low natural gas prices, the region's economy stands to grow in the future thanks to the influx of money and jobs generated by the petrochemical companies that process the gas into a myriad of industrial and consumer products, such as plastics and fertilizers.

It's not just America's oil and gas producers generating these success stories.  A recent report from Environmental Entrepreneurs notes that over 130 newly announced projects in renewable and alternative energy sector could create 46,000 jobs nationally.  The biggest growth comes from the utility sector where power plants across American have begun diversifying generation from biomass, wind, solar and greater efficiency.  On the manufacturing front, Michigan – a state hit particularly hard by the recession – is now on the verge of becoming an energy powerhouse.  Just in the past few months, General Motors has announced new fuel-efficient and electric vehicle factories while Dow Chemical plans to construct a solar shingle roof factory in the Wolverine State.

While these reports do a great job at quantifying the impact of American energy production, we must be reminded that this kind of growth does not occur overnight.  Operators need the technology that enables these energy resources to be produced in an efficient, environmentally friendly manner, and investors require assurances of sound, predictable regulations to ensure the competitiveness of their businesses.

Tighter Regulations Fuels Job Growth

While petroleum engineer might be the best job in Oklahoma, it's not the industry's fastest growing.

While jobs typically associated with oil and gas operations — engineers, extractors, geoscientists and equipment operators — enjoyed robust expansion in recent years, the most growth has less to do with drilling and more to do with regulation, according to a new report on the state of Oklahoma's energy industry.

The energy industry's fastest-growing job in Oklahoma: compliance officer.

Oklahoma's oil and gas industry employed 90 compliance officers in 2003. By 2010, that number ballooned to 590 — a 555 percent increase, according to a report (right-click here to download) by economist Russell Evans, the executive director of Oklahoma City University's Steven C. Agee Economic Research and Policy Institute.

Compliance officers with oil and natural gas companies ensure that contracts, licenses, permits and inspections follow appropriate federal, state and local laws.

Citizens Knowledge of Frac'ing Grows

Appearing in the Post Independent op-ed section this week was an excellent letter from Scott Cline, of Stanley, NY. The premise of Cline's submission was to refute claims (May 5, Post Independent) from a hydrologist, Dr. Tom Myers, who had recently claimed that frac'ing contaminates groundwater.

Cline's letter was especially relevant because he holds a Ph.D. as a petroleum reservoir engineer and geologist, and has spent 30 years in petroleum reservoir modeling, assessment and fluid flow analysis.

We encourage you to read the full letter, which is an excellent example of informed citizens who have stepped up to educate their fellow neighbors on the truth behind frac'ing and the importance it poses to our nation's energy dependence.

Seismic Surveys Key to Recovering World’s Oil and Gas

The work of marine seismic survey companies is becoming more and more critical as the world's recoverable oil and gas reserves continue to be a concern. The search for new carbon deposits ranges farther and farther offshore, and deeper and deeper beneath the surface, often in harsh, inhospitable climates. According to most estimates, seismic activity is expected to grow 10 percent this year with business picking up in the Gulf of Mexico and the Arctic continuing to be a hot exploration frontier.

"There are an estimated 380 billion barrels of undiscovered oil and gas north of the Arctic Circle that remain to be found, of which 84 percent is expected to occur in offshore areas," says Peter Zickerman, Executive Vice President and Head of Strategic Investments for seismic explorer Polarcus in Dubai. "Until the world finds alternative energy sources, the quest to find new oil reserves and maximize extraction from existing fields remains paramount."

Places like the Gulf of Mexico and Northwest Europe, which have been explored several times over, require companies to constantly fine-tune their data-gathering techniques to find hydrocarbons through deeper and more complex geology. "Planning starts with geological objectives," explains Zickerman, "and the right plan provides the geological solution, not just the technology itself, and that's been our breakthrough."

The growth of unconventional exploration is having a huge impact on the oil and gas industry on land and at sea. These unconventional reserves, characterized by tight shale rock, are challenging for producers and have only recently become economically viable with the advent of horizontal drilling and hydraulic fracturing.

MicroSeismic, Inc.'s Mike Mueller, Vice President of Analysis, said,  "There are tremendous unconventional oil and gas resources being developed onshore all over North America and internationally. Offshore unconventional resources are also plentiful but present an additional development challenge in that they tend to be in very deep water."

The unconventional geologic opportunity is called the Lower Tertiary or Paleogene Trend (largely sandstone), characterized by tight reservoirs which have to be stimulated by injecting fluids and propellants in order to open up oil and gas flow – the fracing process. In an offshore drilling scenario, vertical wells could be drilled in 5,000 feet of water through 20,000 feet of sediment and salt and into a pre-salt interval, where stimulating in the pre-salt could begin.

"Early exploration in the Paleogene Trend in the Gulf of Mexico indicates it may contain more oil in one place than has been discovered in all other Gulf of Mexico exploration and production activities to date," says Mueller. "And operators active in the Paleogene will need multistage hydraulic fracturing to complete wells and achieve production rates that make the fields economical in the face of increasing exploration and development costs that are in the tens of billions of dollars. In this emerging market, operators are turning to hydraulic frac monitoring to protect their investment and provide feedback on the effectiveness of their frac programs."

MicroSeismic pioneered a method of monitoring using an array of cables containing geophones, which establishes a large two-dimensional listening device. The passive seismic data gathered 24/7 is critical to measuring pressure and stress changes and borehole failures, which can be transmitted back to an onshore office for analysis. The results are made securely available to clients anywhere in as little as five minutes. "In the hydraulic fracturing monitoring market, the systems MicroSeismic deploys are distinct from the legacy downhole technology and can be implemented offshore with existing seismic acquisition technology," Mueller explained. The company has been testing the technology in an offshore installation for BP in Norway for the past 10 years.

In the post-Macondo era, Mueller advocates passive seismic technology as new areas of exploration and development open up and new environmental regulations take hold. "The unconventional revolution is a game-changing, 25-to-50-year process. In the U.S., the need for oil import volumes is going down. We're reversing a trend that has been in place for 30 years or more. It's astonishing." And it all begins with a seismic survey.

Frac’ing Doesn’t Cause Earthquakes

Steve Everly with Energy in Depth spoke up this week to refute findings from a USGS report claiming that frac'ing causes earthquakes.

Some of the interesting points Steve made:

- The link between waste water wells, which are used to dispose of the water used in fracking under ground, and earthquakes isn't new. It goes back to the 1960′s.

– While "earthquake" is a scary term, the quakes linked the waste water wells aren't dangerous.

– If it turns out that waste water wells are causing earthquakes, there are a lot of things the industry can do such as changing the way they pump water into these wells to recycling and re-using the water.

In short, there's not a lot of cause for alarm in this USGS study. There is, however, a lot of political reasons on the environmental left to try and manufacture alarm and hamstring fossil fuel production.

Another great job from Energy in Depth!

Exxon CEO Defends Frac’ing

Rex Tillerson,  CEO of Exxon Mobil (XOM), has a special fondness for what some think is new technology, frac'ing.

In 1976 Tillerson went to East Texas to follow around rigs drilling for natural gas and complete the wells.  Completion means pumping water, sand, and chemicals down into a well at high pressure, causing cracks in the stone where the gas was trapped and allow more of it to flow; or frac'ing.

Today Tillerson is betting much of his company's future growth -- and a good portion of his legacy -- on the promise of frac'ing. Two years ago Tillerson engineered a $35 billion acquisition of natural-gas producer XTO Energy in large part to buy the company's hydraulic-fracturing expertise. It is easily the largest deal the energy giant has done since the $88 billion mega-merger with Mobil orchestrated by Tillerson's predecessor, Lee Raymond, in 1999.

In buying XTO, the 60-year-old Tillerson has further reshaped the company. In 2011, Exxon reported sales of $486 billion -- a gargantuan number that could vault it past Wal-Mart (WMT) to recapture the No. 1 position in this year's Fortune 500. The $41 billion in profit it earned was the second-largest total in corporate history, behind only the $45 billion record that Exxon set in 2008. Those astronomical earnings have been driven by persistently high oil prices. But today Exxon, the prototypical oil giant, gets about 50% of its production from, and has 50% of its reserves in, natural gas.

It's not just Exxon that has profited. Over the past several years frac'ing has unlocked a vast new source of energy supply in the U.S. Advanced forms of the process that Tillerson used in the 1970s, combined with innovative methods of drilling, have enabled energy companies to extract huge quantities of natural gas and oil trapped in shale rock -- assets that were previously thought to be either impossible or uneconomic to produce.

It is widely thought that the U.S. now has 100 years or more of domestic gas supply at current consumption rates. Already there has been a frenzy of exploration. The shale gas industry employed more than 600,000 workers in the U.S. in 2010, according to IHS, and by 2015 it will contribute some $118 billion to the U.S. economy.

Large shale deposits in South America, China, and Europe mean that it should eventually be a global trend as well. The International Energy Agency estimates that the world currently has a 250-year supply of natural gas. "In my 50 years of following the energy business, this is by far the biggest event that I've seen," says John Deutch, an MIT professor and a former CIA director who last year chaired a Department of Energy subcommittee on shale gas.

Marcellus Offers Opportunity for Local Veterans

In addition to local economic benefits of shale gas drilling, it seems that for veterans, too, this boom has created the opportunity for employment.

Many military men and women are accustomed to long hours, often in extreme conditions or operating heavy equipment. So it's a natural transition that veterans returning home to Pennsylvania might pursue similar work upon their return, where the Marcellus Shale formation underlays about 60 percent of the state.

Scott Grady of Pittsburgh's Veterans Leadership Program has worked with about 20 veterans hired for jobs in the shale industry over the past two years. He cited veterans' "intangible" skills, such as a respect and knowledge of safety procedures, discipline and an accelerated learning curve as further proof the industry is a good match.

"I think the talent pool is here," he said. "I think they are out there and they can fill a lot of jobs with a little bit of training."

That includes a four-week shale gas training course, a required introduction into the way rigs are operated. It's offered at community colleges and adult learning centers in the area; at least two local training centers bundle this training and a commercial driver's license course for $7,000. The Veterans Leadership Program provides grants to help offset that cost, and the GI Bill covers many training courses.

"Your options are to go sit in a college classroom and go to school for four years and get a bachelor's degree -- or you could go to a four-week training program," Mr. Grady said. "I wish I would have had that option."

Shale jobs include various operators for drilling and hydraulic fracturing teams. Truck drivers are needed to haul waste water and equipment, as well as welders and workers to operate rigs and tend wells. Most careers are field-based.

Families Benefit from Marcellus Shale Development

One benefit of Marcellus Shale development we don't often hear is that it is reuniting and strengthening families across Pennsylvania.

While many have heard of the obvious economic benefits and consumer savings made possible thanks to this development, a new video "Women of the Marcellus" produced by Energy In Depth highlights the stories of families whose lives have improved thanks to Marcellus development.

The video highlights a dairy farmer in Troy who expanded operations and a young couple that purchased a bed and breakfast in Towanda – and there are many other stories of families brought together from Marcellus development.

With the Marcellus employing over 229,000 Pennsylvanians (over two percent of the commonwealth's population), it's comforting to know that our younger generation can find work and families can stay together as a result.

Reader Speaks Out in Favor of Frac’ing

A recent op ed in the New York Daily Star featured a letter you don't typically see from the average reader. The post spoke out in favor of frac'ing and in fact, went so far as to say, "Enacting a natural gas ban is a terrible idea for any town."

The argument for frac'ing in this letter offered several points for consideration, including:

By enacting a ban or even a moratorium, a town is putting itself at risk of being sued and costing taxpayers enormous amounts of money, because people have every right to use every part of their property.

Natural gas exploration has been proven safe and the industry would be working under the world's strictest regulations if New York State opens its doors to the industry. (Second that!)

Currently, property owners are at risk of losing their homes and family farms to foreclosures. The natural gas industry could be the only saving grace for our area.

With the regulations New York has, it's difficult to argue it will not be monitored closely. There is no justification under these circumstances for taking away property rights.

The writer concludes by encouraging others to, "Protect your town by telling your elected officials not to enact bans on the natural gas industry."

We applaud this reader's moxie in stating the facts for what they are-facts-for and taking a stand where so many fear to do so. Hopefully New York is listening, too!

EPA Declares No Groundwater Contamination in Marcellus Shale

Last Week, the Environmental Protection Agency (EPA) completed results in the testing of more than 20 water wells at the center of a debate over the safety of natural gas drilling in the Marcellus Shale. The verdict? No dangerous levels of contamination.

Featured in the now debunked documentary "Gasland," the Susquehanna County village of Dimock has been at the center of a fierce debate over drilling, in particular the process of hydraulic fracturing, or frac'ing.

State environmental regulators previously claimed that Houston-based Cabot Oil & Gas Corp. contaminated the aquifer underneath homes along Carter Road in Dimock with explosive levels of methane gas, although they later determined the company had met its obligation to provide safe drinking water to residents.

A Cabot spokesman said in a statement Friday that the "data confirms the earlier EPA finding that levels of contaminants found do not possess a threat to human health and the environment."

"Importantly, the EPA again did not indicate that those contaminants that were detected bore any relationship to oil and gas development in the Dimock area, particularly given the fact that any contaminants are more likely indicative of naturally-occurring background levels or other unrelated activities," the statement said.

Shell Talks Energy Conservation

Shell Oil Co. President Marvin Odum said improving energy conservation and developing additional supplies are the key to relieving high crude prices that are driving up the cost of gasoline in the U.S.

Much of the public debate over gasoline prices has involved oil company taxes and what measures the government can take to control prices at the pump, but Odum suggested other matters are more significant.

"We think all the focus on that is actually the wrong discussion," Odum said. "The world oil price is set outside of these companies. The question that high gasoline prices in the U.S. ought to raise is how do we impact the amount we use and how do we impact the amount we make ourselves – that is exactly where the conversation ought to go."

Odum said that long-term price solutions will come from conservation, such as vehicle fuel efficiency standards, and from further development of U.S. energy resources, including expanded exploration in the Gulf of Mexico and the Arctic.

Turning to an opposite price issue, Odum said the low price of natural gas might cause some short-term pain, but could fuel a manufacturing revolution in the U.S.

Natural gas was down 2.3 cents to $2.13 per million British thermal units in trading Friday on the New York Mercantile Exchange – its lowest close in more than 10 years.

"We have gone from the standpoint of thinking we were going to import to keep our systems going to being able to export, if we choose to do so, we have discovered so much," Odum said.

Odum said that an important next step should be to develop a national energy plan, to better guide how natural gas could supplement oil as a transportation fuel.

That use is limited now by lack of natural gas fueling infrastructure and by shortages of pipeline, storage and refining capacity.

Horizontal Drilling Credited with Shale Success

US operators should add another 1.5 million b/d of oil and liquids production by 2015 due to the continued growth of shale plays, EOG Resources CEO Mark Papa predicted Tuesday.

Addressing the 40th annual Howard Weil Energy Conference in New Orleans, Papa touted his company shift to oil production from natural gas and emphasized the impact of the industry's shift on historical US oil production.

"We believe that in 2015, US production will be 1.5 million b/d higher than today for the first significant increase in 40 years," he said.

Papa noted that US oil production peaked about 1970 at a rate of 9 million to 10 million b/d.

After years of decline, US oil production has risen the last two years to a current level of about 5.8 million b/d.

Papa credited the revolution in horizontal drilling for exploitation of shales and predicted further growth to add another 1.5 million b/d by 2015, bringing average US output up to a level of more than 7 million b/d.

What If?

Republicans are often accused of being ideologically inflexible, but when it comes to being pigheaded, the man in the Oval Office takes the cake. President Obama refuses to budge on his belief that Americans must be forced to stop using fossil fuels like oil, gas and natural gas as soon as possible and to instead begin depending on clean energy. In his own words, the Obama policy means electricity prices must necessarily skyrocket.

Obama's rigidity on energy policy is also an obstacle to economic recovery. The unemployment rate has been above 9 percent during most of his tenure in office, and there are multiplying signs that it could go back into double digits in coming months. Everything Obama has tried including his $757 billion economic stimulus package, massively expanding federal regulation of the economy, record- setting levels of federal spending, bailing out Wall Street and Detroit, funding clean energy fiascos like Solyndra has failed to put America back to work. In many respects, Obamas policies have made things worse.

The saddest part of this, however, is that Obama could turn things around tomorrow, and he wouldnt even have to get an act of Congress to make it happen. He only needs to instruct his Environmental Protection Agency administrator and interior secretary to stop suffocating the American oil and gas industry. Five steps would be required: re-opening the U.S. Outer Continental Shelf to exploration and production of oil and natural gas, expediting pending exploration and drilling permits in the Arctic region, removing unnecessary bureaucratic impediments to exploration and production on federal lands, approving the Keystone XL pipeline to bring oil from Canada to the U.S., and admitting that hydraulic fracturing aka fracking is environmentally safe and the key to unlocking vast new resources that can make America the Saudi Arabia of energy for the 21st century.

More than 1.4 million new jobs would be created by 2030 if Obama were to take each of the five steps recommended above, according to an econometric study by the energy forecasting firm Woods Mackenzie. And those jobs would be spread across the entire U.S., not just concentrated in a few energy-rich states. New York, for example, would see 50,000 new jobs, while 20,000 would be created in Pennsylvania, 50,000 in Utah, 130,000 in Florida and 85,000 in California. Along with the new jobs would come more than $800 billion in new revenue for governments at all levels. That would be enough to cover the projected budgets of the federal departments of transportation and the interior, the EPA, the Small Business Administration and the General Services Administration until 2030.

The American Petroleum Institute has posted a powerful video entitled What If on YouTube that provides additional details. The man in the White House ought to take off his blinders, remove his earplugs and spend five minutes watching it.

Horizontal Drilling Credited with Shale Success

US operators should add another 1.5 million b/d of oil and liquids production by 2015 due to the continued growth of shale plays, EOG Resources CEO Mark Papa predicted Tuesday.

Addressing the 40th annual Howard Weil Energy Conference in New Orleans, Papa touted his company shift to oil production from natural gas and emphasized the impact of the industry's shift on historical US oil production.

"We believe that in 2015, US production will be 1.5 million b/d higher than today for the first significant increase in 40 years," he said.

Papa noted that US oil production peaked about 1970 at a rate of 9 million to 10 million b/d.

After years of decline, US oil production has risen the last two years to a current level of about 5.8 million b/d.

Papa credited the revolution in horizontal drilling for exploitation of shales and predicted further growth to add another 1.5 million b/d by 2015, bringing average US output up to a level of more than 7 million b/d.

Automakers Rev Up for Frac’ing

Natural gas, whose price is at record lows thanks to a shale-drilling boom, is gaining traction as an alternative energy in the United States, with automakers jumping on the bandwagon.

The use of natural gas instead of oil-based gasoline to drive the country's cars and trucks "is definitely starting to take off," said Mark Hanson, an analyst at investment-research firm Morningstar.

"The economics seem to work," he said, noting it's "just a question of what pace" the necessary infrastructure will take to develop.

Natural is in focus as a potential engine fuel because "it is tremendously good fuel," said David Cole, the chairman emeritus of the Center for Automotive Research.

Unlike gasoline, whose rising prices are causing pain at the pump for consumers, natural gas is cheap in the United States as supplies bulge from production in the country's vast shale-gas formations.

In addition, natural gas burns while emitting less carbon dioxide than gasoline.

There are several forms of natural gas used to power vehicles. Compressed natural gas is pressurized gas stored in a similar way to a vehicle's gasoline tank.

Liquefied natural gas is produced by chilling natural gas to about minus 260 degrees F (minus 162 degrees C). It can be used as engine fuel for heavy ground or maritime vehicles.

In Europe, the fuel of choice for automobiles is liquefied petroleum gas, typically a mixture of butane and propane made from refined crude oil or natural gas.

Natural gas has already afforded the U.S. so many opportunities in the form of employment and potential energy independence. It's exciting to see yet another good thing coming from this alternative energy boom.

Is New York Beginning to See the Frac’ing Light?

A recent op-ed in the New York Post noted that the unemployment rate in 50 of New York's 62 counties is now above the national rate. In the Southern Tier alone, the jobless rate averages 9.5 percent.

While the unemployment situation in New York is no secret, the opine points out that it's "frustrating" to compare apples to apples with neighboring Pennsylvania. Case in point is the contrast between trends in Tioga County and those just across the border in Bradford County, PA.

While employment in Bradford County has grown steadily in recent years, it has fallen in Tioga. In fact, Bradford boasts an unemployment rate of 5.7 percent, well below the national rate of 8.3 percent, while Tioga stands at 9.5 percent (and next-door Broome County, NY, is at 9.7 percent).

Unemployment drops literally as soon as you cross the border from New York to the Keystone State.

The Pennsylvania and New York counties share many common characteristics; how is it that the jobs picture is so dramatically better on the Keystone State side of the border?

For starters, Pennsylvania has developed its shale-gas industry, while New York's de facto ban on natural-gas development is choking off valuable economic growth.

It's not just mining jobs that the "frac'ing" ban kills; Pennsylvania recently secured a huge ethanol-cracker plant that Gov. Tom Corbett called the largest investment in the state in two generations.

This $2 billion facility will create 10,000 construction jobs and 600 high-paying permanent jobs, according to the American Chemistry Council. As Corbett noted, "There will be new jobs in engineering, manufacturing, chemistry and energy for decades to come."

These high-paying, skilled jobs are the kind that New York's elected officials say they want to attract to the state.

Neighboring states are winning business, jobs and investment, even outside of direct gas exploration, because they're updating gas regulations (while still protecting their environment) to promote the growth of gas-development and other industries.

In contrast, by delaying development of our own resources in the Marcellus Shale, New York is denying employment opportunities and stalling economic growth for local communities and the entire state.

Plus, New York school districts and local governments are missing out on greater tax revenues and fees that could support investments in education, infrastructure and economic development.

Responsible pro-growth policies are the most direct way of reaching such important social goals as successful classrooms, higher employment and, ultimately, thriving communities.

Energy in Depth Debunks Colorado Health Study

Energy in Depth has done it again, debunking a recently released paper  from the Colorado School of Public Health (CSPH) that suggests the development of oil and natural gas in general – and the use of hydraulic fracturing in particular – can cause "serious health impacts" for those who live closest to well sites.

EID goes on to outline eight specific assumptions made that, upon closer examination and considered in combination, cast serious doubt on the results produced by the exercise.>Here's a teaser:

Bad Input #1: Out of Date Emissions Data

CSPH: "We used air toxics data collected in Garfield County from January 2008 to November 2010 as part of a special study of short-term exposure as well as on-going ambient air monitoring program data to estimate subchronic and chronic exposures and health risks."

  • FACT: Colorado updated its regulatory requirements for oil and gas systems in February 2009, which means at least a portion of the data collected by CSPH is from an operating environment that, by law, no longer exists. Among the rules were requirements for volatile organic compounds (VOCs) to be reduced by as much as 95 percent through the use of low- or no-bleed pneumatic devices.

Ready to read on? Visit the EID website for the full refute. Way to go guys!

No Groundwater Contamination in Pennsylvania

A first round of tests showed no evidence that water at 11 homes in a small town in Pennsylvania near natural gas drilling operations had been polluted to unhealthy levels, U.S. environmental regulators said.

The Environmental Protection Agency said in January it would perform tests at about 60 homes in Dimock where residents have complained since 2008 of cloudy, foul-smelling water after Cabot Oil & Gas Corp began fracing for gas nearby.

Sampling results from the first round of 11 homes "did not show levels of contamination that could present a health concern," a regional EPA spokesman said in an email.

The EPA has been delivering fresh water to several homes in Dimock including three of the 11 homes. It will continue to provide water to those homes while it performs more sampling.

A Cabot spokesman said the company was pleased with the first round of results and it would continue to work with the EPA.

Fracing has without question, revolutionized the U.S. natural gas industry by giving companies access to vast new reserves that could supply the country's demand for 100 years. Though revolutionary, fracing isn't new; it's been in use for more than 6 decades.

Thanks to the technology behind Microseismic,  we are able to monitor microseismic events from or near the surface, in real-time.  Similar to a stethoscope on the chest of the reservoir, these technologies give insight as fracing happens, allowing operators to optimize field development plans and avoid fracturing into environmentally sensitive areas-whether that's the aquifer or a seismic fault.

MicroSeismic’s Partner Whiting Increases Forecast

Concho Resources, Whiting Petroleum Corp and Stone Energy announced a higher oil and gas production in 2012.

U.S. oil and gas production overall has risen to record levels as the energy industry has invested billions of dollars into developing shale rock fields that were once too difficult and expensive to tap.

Whiting, a MicroSeismic customer has found microseismic technology  key to their success.

Denver, Colorado-based Whiting raised its full-year production forecast to 77,300 barrels of oil equivalent per day (boe/d) to 81,100 boe/d. It had earlier expected 76,500 boe/d to 80,600 boe/d.

Whiting also raised its first-quarter production forecast to 75,700 boe/d to 79,100 boe/d from 72,500 boe/d to 74,700 boe/d.

Fourth-quarter adjusted net income was $124.5 million, or $1.05 per share. Analysts on average were expecting 96 cents a share, according to Thomson Reuters I/B/E/S.

Congratulations to a great partner and here's to our future success!

Marcellus Shale Job Growth

Ending our week with more positive employment news, thanks to shale natural gas drilling, in a report by Wells Fargo Securities' economics group showing that the oil and gas industry's efforts in the Marcellus Shale have not only had a measurable effect on Pennsylvania's economy, but is likely to generate more than 200,000 additional jobs by 2020.

Pennsylvania has added 130,000 jobs since employment bottomed out in February 2010, one-third of them in education and health care. The state's economy is growing faster than it did at any point during the past decade, the report said.

Although the natural resources and mining sector employs less than 1 percent of the state's workforce, it accounted for 8 percent of recent job growth, the study said.

Employment in the 14 counties where drilling is most prevalent is already above its pre-recession peak, a result the study ties to the economic impact of natural gas drilling. For every percentage point of employment growth in shale counties, employment in Pennsylvania's other counties rises by 0.27 percent, the study found.

The study calculated optimistic, pessimistic and midpoint scenarios for Pennsylvania employment through 2020. The midpoint scenario predicts employment growth of 570,000 jobs, of which 200,000 can be attributed to the shale industry and its spillover effects.

Gasland Outed Again as More Myth than Truth Op-ed

South Africa's Daily Maverick published an opinion piece this week that further debunks the Gasland  "gospel" that so many members of both the public and the media take for truth.

The oped is particularly timely as South Africa prepares to issue exploration permits for their own natural gas opportunities.

Author Ivo Vetger provides a thorough and well vetted list of reasons why the documentary, despite being nominated for an Oscar and winning the 2010 Sundance Film Festival Special Jury Prize, contains more fiction than fact.

Do watch it. Then permit me to highlight just a few examples of the lies that appear in the film. I'm not the first to make such a list, by a long shot, but if it's going to continue being cited, then it ought to continue being disputed.

Vetger's 10 points are extremely lengthy, but well worth the ten minute read, (especially if you are still finding yourself defending your profession at cocktail parties!). We encourage you to read the full piece on the Daily Maverick's website.

Preaching to the Choir

It's been said many times before, but at the recent IADC Drilling Conference in San Diego, the cry for our industry to work harder to build the public's trust was heard again.

"Your image started out long before Macondo," said Quenton Dokken, president and chief executive officer of the Gulf of Mexico Foundation Inc. He referred to the April 2010 blowout of the deepwater Macondo well off Louisiana, which resulted in 11 deaths and a massive oil spill.

"You are a part of the whole of vested interests in the gulf. You are not the whole," Dokken said. "Industry is only as strong as its weakest player."

Martin Durbin, American Petroleum Institute executive vice-president of government affairs, agreed. "As an industry, we've got to hold ourselves up to a higher standard," he said.

Durbin also noted that industry can be proud of its accomplishments, including the operating standards that API has provided since it was founded decades ago.

Currently, API is working to communicate with residents "county by county and town by town" in states where industry is using hydraulic fracturing. Individual companies also are doing this, Durbin said. API also consults with regulators and lawmakers in these states.

"Trust has got to be viewed as a long-term prospect," Durbin said.

There are many companies in our industry, such as Gastar, who are utilizing MicroSeismic's technology to make real-time decisions while frac'ing, saving time, money and protecting groundwater supplies.

Overall, our industry needs to work together to promote energy literacy throughout the general public by honestly presenting the facts, he said. This means explaining the risks as well as the benefits such as job creation, economic growth and revenue that the industry provides the federal government.

New Website Serves as Frac’ing Chemicals Registry

Fracfocus.org is a website used by the energy industry to track the chemicals employed in frac'ing and its receiving rave reviews from the Obama administration and the Bureau of Land Management, who are working to developing regulations to ensure frac'ing doesn't contaminate groundwater.

The Interior Department unit, led by Bob Abbey, plans to require companies such as Chesapeake Energy Corp. (CHK) to list substances they use in producing oil or natural gas on federal lands.

The American Petroleum Institute, which represents these (and other) operators, has said producers do disclose the chemicals on the FracFocus website and additional regulations aren't necessary.

"FracFocus has worked well for disclosure of chemicals," Abbey said at a House Appropriations Committee hearing in Washington. "Frac'ing technology is a tremendous, tremendous tool for this nation and to the industry to allow us to continue to make progress to reduce our dependence on foreign fuels."

We applaud companies who use Fracfocus and the industry as a whole, who are constantly working to dispel public myths that frac'ing isn't a safe solution to provide energy and employment to our nation.

Frac’ing Puts the “Oh!” in Ohio

A recent Washington Post article asked, "Can the shale gas boom save Ohio?" The answer, overwhelmingly, appears to be "yes"!

Chesapeake Energy is looking for truck drivers with licenses for hazardous materials, a purchasing coordinator for oil field equipment, a pipeline technician, a field safety coordinator, administrative assistants, troubleshooting electricians, a tax analyst and more.

"We are very excited about the Utica," Chesapeake's chief executive, Aubrey McClendon, said in a Feb. 22 conference call.

Chesapeake has spent $2.2 billion and amassed about 800,000 acres of leases in the rich Utica shale that runs underneath eastern Ohio. It has eight rigs running and plans to install 200 miles of pipeline this year alone.

These efforts will have no small effect in Canton, where the unemployment rate peaked at 12.3 percent in January 2010 and where it was still running at 8.7 percent at the end of last year.

In addition to the employment benefits, a recent study shows economic success that Ohio also stands to gain. Rough estimates by Ohio's Department of Natural Resources indicate that Ohio has a potential reserve of 3.8 trillion to 15.7 trillion cubic feet of gas and 1.3 billion and 5.5 billion barrels of oil. These resources lead directly to money going back into the pockets of Ohio's families, businesses and industries.

And the increase in production over recent years has already benefited energy consumers. In 2010, the average residential customer saved $214 in gas bills; the average commercial customer saved $1,366; and the average industrial customer saved almost $87,000.

If Ohio is able to continue to effectively utilize and grow its own resources, they stand to be a true energy powerhouse.