What is Fracking?

Fracking, aka hydraulic fracturing as it is referred to by the oil industry, has become fashionable so it seems. Had you told me in 2010 that an obscure industrial process would become cocktail chatter, I’d have thought you a little off center. Yet here we are. Citizens, states, and entire countries are getting worked up and taking sides.

This article takes a look at hydraulic fracturing, primarily through the eyes of a mineral or landowner. If you haven’t heard of hydraulic fracturing (or “fracking, fracing, hydro-fracking - we'll use them all here”), you’re likely far removed from the topic of energy production. This article will inform and provide context surrounding this process, heretofore, almost unknown outside the oil industry. Fracking has become the preferred method to unlock valuable hydrocarbons from tight underground rock formations. We’ll focus on fracturing in shale formations, where the process is used most prevalently. In general, this oil and gas well completion process requires 5-10 acres of space at the well location, multiple water tanks and/or storage ponds, millions of gallons of water, millions of pounds of sand and perhaps most controversially, additives (chemicals) that make the entire process more efficient and effective.   Combine this with 50 to 150 workers, several million dollars worth of specialized pumping equipment, 5 to 30 days of time, and you’ve got the makings of what’s known in the industry as a “frac job”. Typical large scale frac jobs in shale formations cost between 3 and 5 million dollars, and are usually performed just after the initial drilling of a well.

What Is Fracking and When Did It Begin?

The U.S. Environmental Protection Agency (EPA) – not that they are an authority on the subject - defines hydraulic fracturing as “A well stimulation process used to maximize the extraction of underground resources - oil, natural gas and geothermal energy. The process includes the acquisition of source water, well construction, well stimulation, and waste disposal.” From the perspective of a land owner, mineral rights owner, or both, what you actually observe is an array of specialized trucks, water storage, and a massive collection of hydraulic horsepower mounted on a small army of 18 wheelers. To experience the orchestration of 50,000 hydraulic horsepower working in concert to pump sand laden gelled fluid at 80 barrels per minute (BPM) at 10,000 psi of force is truly a sight to behold. If you like muscle cars, you will LOVE a hydraulic fracturing job. Over the past 60 years, more than 1,000,000 specialized fracture treatments have been performed on oil and gas wells across America.

The fracturing technique predominantly being used today was developed in the 1990's, made famous by Mitchell Energy, who first proved the process would work in the Barnett Shale formation in North Texas. Before that time, frack jobs were performed with more expensive fluids at lower volumes. Mitchell was able to use water as the primary ingredient and lowered completion costs by more than 75%. The mix of water and chemicals used today is commonly called "Slickwater". News of Mitchell's success in the Barnett spread rapidly given that the industry already knew of many similar shale formations. Operators now had the knowledge to produce oil and gas reserves they knew were there, but previously couldn’t extract at economically attractive flow rates. Large scale fracture completions were affordable for the first time.

How Does Fracking Work?

Fracturing is accomplished by pumping a proppant laden fluid at high-pressure down a well bore out into hydrocarbon bearing rock formations. The two primary ingredients of a frack job are water and proppant. Water often comes from the property that is under lease for oil and gas, either from its groundwater, or surface sources that are made available to the operator. If not available in the immediate vicinity, water is trucked or even piped in. Sometimes temporary ponds are built. The opportunity to sell water may present itself to landowners who have water resources that operators need. The most common proppant used in oil and gas operations is sand. There are different sizes and strengths, but to the untrained eye it looks like beach sand. Ceramic and bauxite proppants are also used in situations where higher crush strength is needed.

Oilfield service companies providing hydraulic fracturing services include Halliburton, Schlumberger, Weatherford, Petrofrac and Baker Hughes. You can easily observe which company is performing the job as you notice their branding on the convoy of trucks headed to a well site. Speaking of trucks, have you ever had a rock hit your windshield?  That crack ‘spiderwebbing’ across your windshield is a reasonable comparison to what an underground fracture looks. The spidering effect is similar to what’s happening within the shale rock formation during the fracturing process.  See a nice representation of this in this hydraulic fracturing video provided by Marathon Oil above.

After the proppant laden frac fluid has done its job of creating fractures (ie conductivity) allowing hydrocarbons to flow into the wellbore, the excess water flows back up the wellbore where it is trucked to disposal wells or may be recycled for use in future frack jobs. More and more, portable water treatment plants are being employed to clean this flow-back water, making it is safe and useful again. Oil company personnel are generally happy to answer landowner questions about water usage and treatment. Many companies even have an area on their website addressing the issue.

Fracking and Politics

Should citizen land and mineral owners be worried about fracking contaminants or chemicals? This has become quite a hot political topic – sadly in our view – due to ample misinformation, mischaracterization, and downright uninformed commentary. The primary concern revolves around the question of whether or not fracking taints fresh water sources used for human consumption. Several operators have made public the chemicals they use, in addition to independent websites which list them. In general, the industry is shifting to use more environmentally friendly chemicals.

Regardless of ongoing arguments, the fact is that fracking is the only feasible method to economically extract hydrocarbons from tight, low permeability shale formations that are abundant in the US. So until a safer or more efficient way is developed, we’ll have to stick to what works. As you may suspect, there’s no shortage of naysayers. Some have chosen to totally ban fracking - Vermont (there is no oil & gas production in the state), France and Bulgaria to name a few, and others like New York and Quebec who have placed moratoriums on fracking pending further study. So whatever corner you’re in...frack on or frack off, it’s a debate that’s sure to continue.

Importance and Impact of Hydraulic Fracturing

It cannot be denied that domestic production of oil and natural gas has increased dramatically since the early 2000’s as a direct result of hydraulic fracturing combined with horizontal drilling. U.S. Oil production surpassed 7 million barrels per day at the end of 2012 for the first time since 1993. Most people agree that home grown energy is important to foster, and thus take pride in the fact that we are reducing demand for foreign oil and gas. Increasingly, natural gas comes to the forefront as the alternative fuel because of it’s clean burning properties and its abundance within US shale reservoirs. Because of increasing public pressure, the process will likely become even more streamlined because of improved technology and thoroughly vetted additives.

Fracking and the Landowner

In short, landowners do not have a lot to worry about, nor do they have much say in how a well is completed. Regulation has been historically left to the states and it will likely remain so. There are a few things landowners should consider:

• Can a well be drilled on our near my property?

• What does my mineral lease allow for?

• Does my oil & gas lease allow the company to access and use fresh water sources on my property? (most leases do)

• If your property was leased in the past ten years, the improvements in production rates as a result of new fracking methods are often the reason why.

Additional Reading

• Mineral Rights Value - Short article explaining how to estimate the value of oil & gas mineral rights and what influences their value. Gain perspective on your minerals and royalty.
• Oil & Gas Production 101 - Article explaining the drilling, completing, and testing of oil and gas wells in nontechnical language.