Baker Hughes Inc. says it will become the first major oil field services company to stop ignoring the elephant in the room and begin disclosing all the chemicals it uses in its hydraulic fracturing operations.
Rivals Schlumberger and Halliburton, the largest and second-largest service companies, respectively, have not yet commented on when, or whether they will follow No. 3 Baker Hughes’ lead. Industry watchers, however, now widely expect them to eventually disclose the nature of all their fracking chemicals as well.
In any case, the disclosures won’t happen overnight. In announcing its intentions, Baker Hughes said it will take several months before it can fully disclose all the chemicals it uses. The company first must renegotiate some contracts with suppliers, customers and other parties to allow for public disclosure. Nevertheless, Baker Hughes decision is widely seen as the beginning of the end for the industry’s efforts to keep the lid on the mix of chemicals used in fracking.
The Impact of Disclosing Fracking Chemicals
Hydraulic fracturing, a 60-year-old technology, used in conjunction with horizontal drilling has revolutionized the oil and gas industry in the 21st century. Tens of thousands of wells – mostly in North America, but increasingly elsewhere – have been drilled since the turn of the century using technology that involves high-pressure pumping of a mixture of water, sand and chemicals underground to fracture mostly shale rock formations and provide pathways for hydrocarbons to reach the wellbore.
The U.S. Department of Energy welcomed the announcement. Paula Gant, Deputy Assistant Energy Secretary, said Baker Hughes’ decisions “is an important step in building public confidence” in unconventional drilling. She said the agency “hopes others will follow their lead.”
Natural Gas Boom Inspires Drillers to Try New Methods
These unconventional drilling methods contributed to the natural gas boom of the past two decades. Success in the Barnett Shale formation in North Texas encouraged drillers to try – and improve – unconventional drilling methods in the Eagle Ford formation in South Texas, the Bakken formation in the Dakotas, the Marcellus Shale formation in Pennsylvania, West Virginia and New York, plus half a dozen other big unconventional plays opened up in the last decade or so. While gas continues to be sought and found in such plays, in recent years high gas supplies, low gas prices and other economic factors have pushed drillers to focus on extracting more liquid hydrocarbons via unconventional methods.
Environmentalists and other critics of the industry vocally have questioned the safety of the chemicals used in fracking over the past 15 years. Their concerns have focused on allegations that ground water and aquifers can be or have been contaminated by the chemicals pumped down wellbores and/or by the industry’s practice of pumping used wellbore mixtures into so-called “injection wells” for permanent storage and disposal.
Oil and Gas Industry Feeling the Pressure
Until now, the industry has been resistant to calls for full disclosure, insisting that critics’ concerns are unfounded, overblown, or misplaced. Nearly all cases of water contamination resulted from failed wellbore casings, the industry said, a problem it has sought to rectify with new procedures and materials.
In 2011, FracFocus.org was created as a website for the voluntary disclosure of some – but not all – chemicals used in fracking. A number of energy-producing states subsequently began requiring drillers to report their chemical usage to the FracFocus site, but a number of exclusions that allowed drillers to keep some chemicals a secret for proprietary reasons triggered further criticism of the industry for its secretive ways. FracFocus is operated by a partnership that includes the Ground Water Protection Council, a group of state water officials, and the Interstate Oil and Gas Compact Commission, an association of states that produce the fuels.
Even after Baker Hughes begins disclosing all the chemicals it uses in fracking on a well-by-well basis, it will not disclose the formulas determining the amount of those chemicals or the amount of sand and water that goes into its wellbores. While various chemicals are used for different types of rock and in different regions, some of the chemicals are toxic, at least in certain amounts and/or in the presence of other chemicals. But while there’s general expectation the rest of the industry will follow Baker Hughes’ lead in reporting all the chemicals it uses, there’s almost no expectation that drillers will disclose their fracking formulas.
Veteran industry journalist Loren Steffy, writing for FORBES online, criticized the industry’s long-standing resistance to disclosure. That helped foster, he said, widespread public distrust unnecessarily. As long as drillers disclose the chemicals they use but keep their formulas secret, there was little chance that competitors would be able to copy the more successful mixtures.
“After all, the secret recipe of Coca-Cola has been considered one of the most closely guarded trade secrets in the world for more than 125 years, yet Coke still puts the ingredients in every can,” Steffy wrote.
Hey, like this post? Why not share it with a friend?Tweet