Frack Finding Tour – Day 2 – Fort Worth city & suburbs
Day 2 – Fort Worth Texas
Fort Worth is a city of over 1 million people and is, seemingly proudly, the first city in the US to allow the unconventional gas industry into its urban centre. Today there are 2000 wells with their tanks, pipes, separators, massive noisy drilling operations, compressor stations, fencing, roads, water holding ponds, all within the city limits. This heavy industry is everywhere we look. It dominates the urban environment.
It is metres from homes, in the museum district, next to apartment blocks, next to banks and medical centres, in the down town area and along the banks of the Trinity River which runs the full length of Texas through Dallas and Forth Worth to the coast.
Don Young knows all about what has been going on in Fort Worth. He became an accidental activist after Chesepaeke Energy applied to drill in the conservation park across the road from his house in 2004. He started up the Fort Worth Citizens Against Neighborhood Drilling Ordinance to fight the plans. A lifelong resident of Fort Worth, Don and his wife Deborah are leaving this year, fed up with the impact on their lives of the gas industry and the apathy within the conservative town about the long term impacts that the gas industry presents.
Don’s was the first house I saw showing any form of opposition to the gas industry since arriving in the US. The understated red sign‘Just say no to urban gas drilling’ was hammered into the front lawn. His car was the first I saw with anti-gas stickers too. The reason for the apathy according to Don is the upfront payments paid by the gas companies to landholders to lease the rights to gas under their properties. It works to effectively buy off opposition.
In the US landholders generally hold title to the minerals under their land and the gas companies sign lease agreements to be able to access and sell the gas. These agreements are also struck with residential small lot holders in urban environments where presumably the gas company works out what your share of total gas production from an area is worth and pay a royalty rate of around 25%.
Of course this sounds like a lot of money and many are told of ‘lotto’ like returns over the next few decades. What many fail to realise is that by signing a lease with the gas companies, the landholders essentially enter into the gas business and the costs of production is then factored in before royalties are paid. According to Gary Hogan (North Central Texas Communities Alliance) who lives about 100 metres from a multi-well pad at Chapel Creek, the landholders in his residential suburb are getting around $100 per year. Combined with the 20-30% fall in property values that Gary puts down to the gas industry moving into his suburb and property owners appear to be getting the raw end of the deal.
The Industry was described in the New York Times last year as a giant ponzi scheme and Gary agrees. With production rates falling to 50% after the first year, another 10% after the second year, and with significantly higher costs than initially projected to re-stimulate, and maintain flows, the economics are starting to look shaky.
The fall in gas prices has further shaken the confidence of the industry. Most of the new wells according to Gary are being drilled to meet the lease requirements with landholders but are not being stimulated to produce gas and will simply sit there until the prices goes up. For now the industry is largely stagnant with big companies selling out to smaller ones to allow then to manage the wind down of supply from old wells and the decommissioning process. Gary believes if the boom comes back the district will see thousands of more wells but he questions whether or not it is worth it at all.
In his area Gary has witnessed the wholesale industrialization of the residential community with seven multi-pad wells within a mile of his house. The noise and disturbance, especially from the two trips a day the water truck makes to take away produced water, is not compatible with the residential environment. He also thinks there is substantial evidence to suggest the wells are making the community sick with increased allergies and asthma. Air quality in the Dallas / Fort Worth area is now worse than Houston and daily emissions from Oil and Gas is now more than from all vehicular traffic within the area. Don Young told me of a study that showed childhood asthma rates in his county were more than double the national average.
One well site stood out amongst the dozens we saw around Fort Worth as an example of just how crazy the industry is here in Texas.
Driving past a block of relatively new town houses in the middle of suburban Fort Worth we pass an unlined ‘fresh water’ pond about 2 or 3 acres in size that has been dug into what used to be a park. Next to that is a well pad about the same size that looks like it has been prepared for the drilling of six horizontal wells.
The sign on the fence says that Cheasapeake Energy has applied for a protected use waiver to operate within 600metres of a protected use area. I assume the protected use is people’s homes. It looks like the company is confident of getting approval though because they have spent a massive amount of money clearing a large pad and building a water storage pond literally within a few metres of a new town house complex, and a huge fence around the lot with landscaping to hopefully some day shroud this disgraceful loss of community space.
We often hear from the industry in Australia that horizontal drilling will dramatically reduce the footprint of this industry. But if this pad is anything to go by, the multiuse pads are about six times the size of a single pad. With water management added on, if this is done on agricultural land or in sensitive environmental areas in Australia it will be a disaster.
Just down the road is another site without the water pond and with six operating wells right next to a kid’s soccer field. And the childhood asthma rates continue to rise.