A Distinctive US Approach to Shale

Gas Development?

Local Responses to Complex Risks

Susan Christopherson

Department of City and Regional Planning

Cornell University

smc23@cornell.edu

The Horizontal Hydraulic Fracturing Process

Production of Shale Gas in the United States

Production of natural

gas from shale in

the United States

has expanded

rapidly in the last ten

years, and is

projected to

continue through

2040 (EIA 2013a)

At a National Policy Scale, There is Strong

Support for Natural Gas Development

From policy makers because it will lower production

costs and increase the balance of payments

From scientists because it will lower CO2emissions

Local and Regional Concerns

The Risks from Shale Gas Development are

Significant and Spatially Extensive

Environmental risks include water, air, and noise

pollution, effects on habitat, seismic risks from injection

wells.

Economic risks include the effects of a resource “boom-

bust” cycle on local and regional economies, the” crowding

out” of other industries -- tourism, organic farming, dairy

farming, manufacturing -- and loss of property value

because of proximity to industrial sites and activities.

Social risks include increasing crime, conflicts within

communities, and inability to provide housing or services to

boom period population.

Risks Levels are Affected By The Pace and

Scale of Development

Pace: How rapidly well development

occurs in a geographic area

Scale: The number of wells developed in a

geographic area

Pace and scale are determined by investment

strategies -- land speculation, offerings to

investors, relative prices for oil and gas etc.

Well Development: Each Phase Poses

Risks From Industrial Activity

Phase I: (months per well, years for entire region)

Construct access roads, well pad, local collection pipelines

Drill & fracture well

Construct supporting facilities and services

Phase II: (years or decades for region)

Truck water from well site, monitor natural gas production

Re-fracture well if necessary

Reclaim some disturbance

Phase III: (years)

Remove surface equipment, plug well

Restore landscape if possible

(Based on Jacquet, 2011)

What Are the Spatial Dimensions of HVHF

Development?

Gas Development is a

Regional Industrial

Process

What Do We See in HVHF Regions?

“Man Camps”

Water extraction sites

Compressor plants

Pipelines

Staging sites

Rail spurs

Gas storage sites and facilities

Processing facilities for

“produced” water or injection wells

Trucks, trucks, trucks

Disruption May Be Extensive and Long-Term,

Depending on the Pace and Scale of

Development

Risks and Benefits May Occur Far From the

Well Pad

Trucks carry drilling and fracturing inputs (sand, water,

chemicals) and equipment move into and out of the

region from distant points.

Gas development infrastructure (pipelines, gas storage

facilities, produced water facilities may be located far

from the drilling locations

Sand mining in Midwestern states and transport of

Bakken oil by rail to refineries in Canada and the US

creates risks for states and regions outside the shale

plays.

Rural drilling locations may experience risks while

expenditures occur in cities away from the drilling sites.

“Classic” Depictions of Well Sites

HVHF Occurs in Highly-Populated Areas

Hydraulic Fracturing in Suburbs and Cities

Case Studies Tell Us the Local Costs of

Shale Gas Drilling During Boom include:

Accelerated road maintenance

Traffic congestion from trucks

(An estimated 890 to 1,340 truck trips per well site)

Higher public safety costs

Increased demand for health and education services

Increased demand on public administrative services

(e.g. planning and zoning, permitting, assessments,

housing assistance)

New service requirements, such as emergency

response capacity and environmental monitoring and

remediation.

How Will Local Costs Be Paid?

An illustration: SR 3020 in Towanda Township, Bradford County, Pennsylvania

after a high volume of overweight drilling trucks and a Northeast winter (Photo: PennDOT Engineering District 4-0)

Local residents may have to absorb whatever costs are not covered through

state tax policy, local taxes and fees, or local agreements.

Public Safety Impacts

A study of Sublette County Wyoming found that public safety costs rose significantly with increases in drilling.

The question is the threshold at which communities cannot absorb new costs.

Unexpected Patterns/ Unanticipated

Consequences “Despite the influx of workers in the natural gas industry, the population of Bradford

County, as measured by the U.S. Census, actually dropped slightly from 2000 to 2010.”

From a Pennsylvania resident:

“I say good for the people who finally have a decent paying job, good for the people

who are seeing an influx in business, and good for those who saw the opportunity of

a move if so desired. Just remember, there are still those of us remaining who had

nothing to do with any of this. We deal with the traffic, destruction, fear of

contamination everyday. Some of us deal with it twofold. We dealt with the windmills

and gas industry at the same time. We benefit nothing from any of it. We get no

opportunity for natural gas and are still forced to pay premium prices for propane.

We get no electricity benefit from the windmills and are still forced to pay Tri

County's ridiculous rates. Our trucks are taking a beating every day we have to drive

to work. But are forced to deal with it just the same.”

Regions Dependent On Natural Resource

Extraction Frequently Have Poor Long-

Term Development Outcomes

Volatile revenue leads to poor government planning and lack of

accountability. Yet, demands on government rise.

Benefits are concentrated among a few land owners and

businesses. Both those who benefit and those who see little

benefit leave the region. Taxes may rise when the boom ends.

“Crowding out” increases the cost of doing business for firms in

other industries and leads to a decline in economic diversity.

Housing and labor costs rise, negatively affecting investment.

After the initial “ramp-up” construction phase, there are few jobs

and income inequality increases.

Cautionary Trends from New York and

Pennsylvania Gas Drilling Counties

In New York, when compared to adjacent counties or all

of non-metropolitan New York, counties with significant

natural gas drilling (1994-2009) are characterized by:

1. Population loss

2. Smaller increases in real personal income than

adjacent counties

In Pennsylvania, counties with conventional gas

production (1991-2005) show similar trends.

How Are Local Communities and Regions

Reacting to Risks?

A Study of How Marcellus Shale Play

Communities Are Responding

Our database of 298 communities that have taken

some governmental action and interviews with a

stratified sample indicates:

A “wait and see” attitude, moratoria rather than bans

Adaptation through learning

Distrust of the oil and gas industry and of state policy

makers to address risks and public costs.

A commitment to local community sovereignty or

“home rule”

What Did Local Interviews Tell Us?

Learning and time to plan have increased risk

perception.

Community leaders are aware that risk of public

costs extends regionally, beyond the well site.

Costs are clearer than benefits to regional residents.

Local control is emphasized because of lack of

confidence in state level or industry ability to protect

resident interests.

Broader Policy and Theoretical

Implications

The initial protest movement against HVHF has matured through

the mobilization of strategic resources. In this way it resembles

other social movements that moved from protest to direct

engagement with political authority.

The drive for local action emerged in the context of a lack of

confidence in government capacity or will to address the full

effects of HVHF. It built on a longer-term loss of citizen confidence

in US state and federal government.

The absence of a US national energy policy has redistributed risk

to states and regions, leading to fragmented policy and increasing

lack of confidence in regulatory protections.

A Distinctive US Approach to Shale

Gas Development?

Local Responses to Complex Risks

Susan Christopherson

Department of City and Regional Planning

Cornell University

smc23@cornell.edu