Saturday, August 12, 2017

Fracking Craze Resumes - And You'd Be Wise Not To Buy A Home In NE Colorado

A drilling rig operates in Erie in 2015.

It was heart breaking to read the recent Denver Post account of the clash between homeowners in assorted northeastern Colorado communities and the fracking industry  (August 6, p. 1A, 16A). People who not too long ago plopped enormous money into new homes near the Front Range now are faced with the brutal fact they can't sell them for a lousy dime. Who wants to live near fracking -drilling operations, no matter how grand the interior (or exterior) of a home?  And that's even given the home building crunch in the state.

What's even worse is that the problems of noise, oil fumes, methane leaks (such as caused the explosion of a home in Firestone killing two) are likely going to occur even more as the Colorado Oil and Gas Conservation Commission - a fake name if ever there was one - has approved or received nearly 3,400 new drilling permits as of mid-July. Even accepting not all of the new permit applications approved will end up as new wells, many will.  Also, permits show where the oil-gas producers want to go and as the Post noted "much of the activity is centered in Colorado's prime growth corridor."

In the Post's activity analysis (op. cit. p. 16A) it was found that of the 100 townships examined (each measuring 36 square miles) "55 were rural with few inhabitants and 45 contained incorporated areas." However, the numbers are misleading given that "the number of permits in rural regions were about half that in populated areas."

The Wattenberg Field tract is a case in point. Of the 20 townships within it - with half or more of their sections incorporated or developed- producers have "recently requested nearly 1,000 drilling permits".   What gives with the Wattenberg?   According to the Post:

"Although producers have actively drilled the Wattenberg since 1970, analysts said horizontal drilling has given the field a new lease on life that could last for years".

For those who don't know, "horizontal drilling" means a fracking well could conceivably be 600 to 800 ft. from your home and still get at its oil or gas reserves by the simple mechanism of extending the underground drill apparatus horizontally over that distance and into your back yard. Ok, under your back yard is the better term.

According to Imre Kugler of IHS Markit in Houston, quoted in the article:

"If you take the whole Wattenberg Field , at the current drilling pace, there is a solid 15 years left"

That is a solid 15 years to despoil neighborhoods in townships affected by drilling. 15 years during which home owners can forget about selling their biggest investments because no one in their right mind would buy them.

Let's also take note of this (ibid.):

"Communities in the path of drilling have added 103, 578 people since 2010 which represents a growth of 15.8  percent, according to counts provided by the Colorado Demography Office."

That is 103, 578 new residents many of whom became new home owners, but who've now learned to their great distress they've moved into fracking zones. Endless noise and pollution and exponentially falling property values. 

Can oil and gas drillers just bust in and do anything they want- including fouling up your neighborhood with fumes and subjecting it to endless drilling noise, as well as threatening your water and your kids' health? Damned straight they can. Under the state's “forced-pooling” statute - which dates from the 1930s- an oil and gas company can get a property owner’s mineral rights, with compensation, even if the owner doesn’t want to sell or lease them.   Thus, if oil or lots of natural gas was found under our home, frackers could just set up drilling to go beneath and extract whatever's there to their heart's content. Never mind the averse effects and inconvenience, there isn't a goddamned thing we could do about it. Take it to the state supreme court? Ha! Don't make me laugh!  Each time townships or communities have tried that route, the state court quashed it.

Just last year, in fact, Longmont and Fort Collins had their efforts to restrict drilling struck down by the state's top court. That court, along with the COGCC firmly believes it's better you and your kids suffer from rashes, respiratory distress and cancers than that they lose money from stymied frack operations.

This is not to say that other metro areas, communities have also suffered the same fate. It appears to depend on: a) existing population density, or b) whether the community governors or city council wields enough power  (and will) - as well as state house backing - to stop the frackers.   In terms of (a) the model city is LA for which we learn "dense development on top of a prolific basin killed off new drilling".

How so? Well, 17 million people live in the Los Angeles basin "including 1.7 million within a mile of an active oil and gas well" - this according to 2015 estimates from the California Council on Science and Technology.   Basically, then, there are simply too many people squeezed into the area to allow any more drilling activity - hence "existing wells have gone into hiding, taking on building facades or relocating to islands off the coast."

As an example of (b) there is Pittsburgh sitting in the middle of the Western Pennsylvania field.  But in November, 2010, "Pittsburgh City Council banned drilling within city limits."

According to Imre Kugler:

"Pittsburgh has been off limits from Day One, the whole metro area. Nobody has tried to drill there and it's a pain dealing with Pennsylvania".

So there's at least one city and state which appears to have its citizens' welfare a higher priority. At least now. Recall that it took documentaries ('Gasland', 'Gasland II') by Josh Fox to shed light on the fracking issue and potential for well leaks in PA.   See e.g.

Meanwhile, here in Colorado our  fake protectors like the COGCC have enabled the oil and gas giants to take over citizens' lives and render their priorities irrelevant. This has left many Colorado land and homeowners frustrated and feeling that the deck is stacked against them. A driller needs only a single mineral owner to sign a lease, and then everyone else is dragged into the pool. Add to that the oil and gas commission’s liberal approval of pooling orders and the stage is set for potential misuse of the statute.

A link at the end of this post highlights what conditions were for millions of American property owners just three years ago. Now, the drilling has gotten much worse and even more widespread   - especially here in Colorado.  Newcomers that plunked down huge down payments barely 7-8 years ago are now regretting their home purchase decisions as they see the extent to which fracking -drilling has wrecked their home values.  They are raising their voices at town hall meeting, but alas, few are taking them on. 

The unspoken message to anyone planning to move to NE Colorado is: Be prepared for the possibility that your investment could end up quickly in the crapper.  Do you really want to take that crap shot?  Many of those 103,000- odd  newcomers that moved here since 2010 wouldn't do it over again. They are now saddled with homes that have become economic prisons as the oil and gas drillers chip away at the quality of their lives.

See also:

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