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Complying with tighter fracking regulations on federal lands will cost $253,839 per well, says...

Complying with tighter fracking regulations on federal lands will cost $253,839 per well, says EOG Resources (EOG), Wyoming and Utah, citing a study from John Dunham & Associates. That's well above the $11,833 that the Bureau of Land Management estimates, and would cost natural gas producers a total of $1.5B-$1.62B a year.
Comments (44)
  • DougRk
    , contributor
    Comments (1588) | Send Message
     
    Another example of why the US will never have a vibrant economy again. We have passed the tipping point where regulatory burden and the misallocation of resources it causes weighs us down too much.
    9 Sep 2012, 05:37 AM Reply Like
  • dividend_growth
    , contributor
    Comments (2895) | Send Message
     
    Let's drill some wells in your backyard without much oversight, then watch what happens.
    9 Sep 2012, 10:30 AM Reply Like
  • anonymous#12
    , contributor
    Comments (552) | Send Message
     
    "It it's all fun until someone has it's eye poke out"....
    9 Sep 2012, 06:46 PM Reply Like
  • Financial Insights
    , contributor
    Comments (955) | Send Message
     
    What a narrow-sighted comment dsr. These tighter regulations will save billions in future healthcare costs to the country as a whole, and will save these companies from at least some future litigation. I would put the health of citizens over company profits any day.
    9 Sep 2012, 08:25 PM Reply Like
  • DougRk
    , contributor
    Comments (1588) | Send Message
     
    Then why not support regulations that cost $1 million per well? That would save even more money! And save even more lives!

     

    Such is the thinking of people like you.
    10 Sep 2012, 12:15 AM Reply Like
  • Machiavelli999
    , contributor
    Comments (829) | Send Message
     
    Fine, you can claim that without much evidence. But America will no longer be a high growth country. In the past, we built and did things and in the process, yes sometimes safety was compromised. But first and most important for all of us was getting done.
    http://bit.ly/QycNFz

     

    Now, our top priority is safety and caution. The innovations that came about during the Industrial Revolution would, I believe, be illegal today. A tin box going at crazy speeds with humans inside for transportation purposes????? LAW SUIT!!!! A gas piped into people's homes for heating and cooking that is combustible?? NEVER!!!

     

    The interesting thing Andrew Mann is that you are the one short-sighted. People 300 years ago had no drilling and no pesticides and everything was "natural". They saved a LOT in healthcare costs. Because they all died at age 50. Don't worry, we are not going back to that, but we will basically be stuck where we are for a long time.

     

    New innovations will be made in countries willing to take the risk. China is obviously one that comes to mind.
    10 Sep 2012, 12:26 AM Reply Like
  • Financial Insights
    , contributor
    Comments (955) | Send Message
     
    DSR,
    Your comment is illogical and nonsensical. You have no idea what my views are, or how I think. The added costs aren't added specifically by the regulations, and no where did I say that more money spent by the nat gas industry would lead to more lives or money saved. Tighter restriction on fracking and disposal of the chemicals used does save lives and money, so if that costs a little extra for the nat gas companies, oh well. I wish they could guarantee everything 100% without spending more money, but it is the nature of business to do the least for the most profit. That is why government is there, to protect the common good.

     

    No one knows what the actual costs will be, and it would be prudent to wait and see what the total bill will come out to. More than likely this is just a ploy by the nat gas industry to try and get the regulations removed. To be honest, I wouldn't care if it took $100 million per well to make sure that the fracking was safe for the community in the vicinity of each well. It is bad for everybody when greed outweighs the common good.
    10 Sep 2012, 12:51 AM Reply Like
  • Machiavelli999
    , contributor
    Comments (829) | Send Message
     
    Andrew,

     

    You have a complete lack of understanding of economics. If the wells did cost $100 million per well, there would be no wells. There would be no natural gas from the wells. And you would be complaining why natural gas is so expensive and blaming it on the greediness of the gas companies.

     

    Seriously, learn supply & demand. If you block supply, you increase price. It's a very simple concept. Accept it.
    10 Sep 2012, 01:11 AM Reply Like
  • daro
    , contributor
    Comments (1596) | Send Message
     
    lets pump the water from the underground stream running near a gas well to your home. drink that water for a couple years. then report back to us and let us know how you are doing.

     

    Good luck!
    10 Sep 2012, 01:41 AM Reply Like
  • Machiavelli999
    , contributor
    Comments (829) | Send Message
     
    Let's stop all gas & oil drilling. You'll have clean water and we'll return to the Dark Ages.
    10 Sep 2012, 01:54 AM Reply Like
  • Financial Insights
    , contributor
    Comments (955) | Send Message
     
    Machiavelli,

     

    I understand supply and demand and economics just fine, but thanks for the very basic and simple lesson.

     

    You completely missed the point of my comment. The point was that if fracking cannot be done in a safe manner for all involved, then it shouldn't be done. That is where the $100 million came from.

     

    Seriously, learn how to comprehend simple english statements and comments from other points of view, instead of twisting the meaning to match your own outlook. It really is very simple. Have a great week!
    10 Sep 2012, 11:34 AM Reply Like
  • Machiavelli999
    , contributor
    Comments (829) | Send Message
     
    The problem is Andrew, and the reason that I don't think you understand supply & demand, is that once your side is successful in banning fracking, you will be the FIRST ONES complaining about soaring natural gas prices and consequently home heating prices. And you won't blame your actions, you will blame the evil natural gas companies.
    10 Sep 2012, 11:49 AM Reply Like
  • DougRk
    , contributor
    Comments (1588) | Send Message
     
    @ Andrew

     

    > You have no idea what my views are, or how I think

     

    You stated your thinking. To wit, that the increased well cost is offset by societal savings later. That's the classic Dem-socialist political position when it comes to the allocation of capital in a free society. In which case my comment about requiring more spending per well is germane. Why not?

     

    Alternatively, how about letting free people decide where resources should be allocated in a society? That works much better than the top down approach you advocate, as evidenced by the astounding prosperity and vibrant middle class this country created when it was free, and which are both disappearing in our decades long experiment with government control.
    11 Sep 2012, 01:33 AM Reply Like
  • Financial Insights
    , contributor
    Comments (955) | Send Message
     
    dsr,
    Requiring companies to conduct business in a way that is safe for all involved is not a government mandated allocation of resources, but a protection of citizens. And my support of these regulations does not in anyway mean that I am a socialist, or that I am advocating government control of the economy. There is a place for government in certain aspects of business, namely to protect the consumer and workforce. The "market is god" ideology that you are in support of, is inherently flawed.

     

    Can you elaborate on your comment "as evidenced by the astounding prosperity and vibrant middle class this country created when it was free"? The vibrant middle class that you reference was created during periods of historically high income tax rates and government regulation.
    12 Sep 2012, 01:25 PM Reply Like
  • DougRk
    , contributor
    Comments (1588) | Send Message
     
    @andrew,

     

    Taxes alone do not tell the story of govt. control. The regulatory burden is magnitudes greater than 100 or even 30 years ago. I'd take the highest corporate taxes in the world we have now with the regulatory climate of even the FDR years over lower taxes and the today's regulatory burden. You simply have to differentiate between taxation of income without discrimination and regulation of activity, which is inherently discriminatory. I'd go further and say that the income tax of old was much better, being straighter, fairer, and less discriminatory (fewer breaks and loopholes).

     

    You cannot look at just one rule. Every one rule seems innocuous and wonderful. But death by a thousand cuts as they say. If you've ever run a business, you know how mind numbingly complex regulations can be. What is the Federal Code now, 200k pages? 20 million words? Add state, county, city, air quality districts, health districts, etc, and you have the creeping economic paralysis we see. In addition, I'd argue the agencies making the rules are not seeking public health. They are seeking control of an industry and energy they oppose. You have fallen into the cult of believing in motives.

     

    Do I really have to elaborate on the nation's history? A country of nothing and no one became the greatest, most productive economic engine the world has ever seen, with the greatest number of people raised from poverty to the middle class. It can be legitimately argued ours was the first country to ever even have a middle class. All with minimal govt. The govt. controls of the 20th century have eroded our manufacturing and business base. They have their place, but have gone much too far.

     

    Contrary to my position being extreme, yours is. Is there _any_ govt control you'd oppose? Even if a reg. did indeed save money for business, why is that sufficient reason? Doesn't freedom mean _anything_ to you? I can cite countless regs I favor, can you cite any you'd oppose? The mere fact that you defended the reg. as saving money in the long term belies your true thinking about free markets, free people, and a free economy.
    14 Sep 2012, 01:37 AM Reply Like
  • Zigg
    , contributor
    Comments (55) | Send Message
     
    I'd rather have clean drinking water
    9 Sep 2012, 07:53 AM Reply Like
  • donmlp
    , contributor
    Comments (260) | Send Message
     
    put clean water in your car and see what happens
    9 Sep 2012, 08:10 AM Reply Like
  • kommando
    , contributor
    Comments (35) | Send Message
     
    Me too!

     

    Eventually, we'll be the cleanest, geenest, eco-sensitive, vegan cave dwellers in the history of the planet.

     

    Definitely looking forward to that.
    9 Sep 2012, 11:00 AM Reply Like
  • The Long Tail of Finance
    , contributor
    Comments (773) | Send Message
     
    Why is it a choice between clean drinking water and natural gas? I love all the anti-reg types, always too much reg until something awful happens in their backyard.
    9 Sep 2012, 01:14 PM Reply Like
  • Tricky
    , contributor
    Comments (1583) | Send Message
     
    Drink some contaminated water and see what happens
    9 Sep 2012, 05:03 PM Reply Like
  • donmlp
    , contributor
    Comments (260) | Send Message
     
    You are making a a lot of assumptions that have no basis in reality. Before fracking wells where drilled though aquifers with only occasional problems. You are following the political hype in regards to everything oil or coal. My guess the groups you follow are becoming concerned the agenda of propellers and solar panels are becoming even less competitive and trying to stop all progress that has been successful in US becoming less dependent on Mideast oil.
    How about all in and let the market decide ? The choice of fracking or foreign oil is a no bnrainer.
    13 Sep 2012, 09:19 AM Reply Like
  • davidingeorgia
    , contributor
    Comments (2713) | Send Message
     
    The idea is to force them to not drill new wells. With this administration, that's a feature not a bug.
    9 Sep 2012, 08:12 AM Reply Like
  • marpy
    , contributor
    Comments (784) | Send Message
     
    And the real cost will be????? This could be like when the auto industry said catalytic converters would add thousands to the price of a vehicle - actual cost - less than $100.00.
    9 Sep 2012, 08:12 AM Reply Like
  • Carbonyl
    , contributor
    Comments (120) | Send Message
     
    How do you figure that when the scrap yards pays more than that for the converters?
    10 Sep 2012, 03:38 AM Reply Like
  • mweaver
    , contributor
    Comments (201) | Send Message
     
    agreed. the industry will find a way around
    the requirement and spread out the cost
    9 Sep 2012, 09:27 AM Reply Like
  • Joe Dirnfeld
    , contributor
    Comments (1128) | Send Message
     
    Apologist for Obama .
    9 Sep 2012, 10:45 AM Reply Like
  • Joe Dirnfeld
    , contributor
    Comments (1128) | Send Message
     
    We export 500 billion dollars to energy producers a year says Pickens. If they remain here it will save our economy. Obama is against it. His step father used to work for an oil company and he hates oil .
    9 Sep 2012, 10:44 AM Reply Like
  • Oscanana
    , contributor
    Comments (4) | Send Message
     
    Perfect opportunity for a company called GasFrac, which has a patented process of "fracking" that leaves no toxic waste behind, uses propane instead of water (saves tremendous amount of H2O) and recovers said propane in process. My small cap dark horse for the next couple of yrs.
    9 Sep 2012, 01:00 PM Reply Like
  • kcurtis123
    , contributor
    Comments (3) | Send Message
     
    GasFrac - I just don't understand how their technology is so not known and has not become the de facto standard for "clean" fracking??
    10 Sep 2012, 03:30 AM Reply Like
  • aristd
    , contributor
    Comments (15) | Send Message
     
    I was told by a geologist at a local university that the actual fracking process rarely causes any problems with drinking water. Serious problems HAVE occurred when the fracking water was improperly disposed of after the fact. If there needs to be more regulation, maybe it should concern itself with the disposal of these liquids and not designed to hamper the drilling and fracking process itself. Does anyone here know more about this?
    9 Sep 2012, 05:38 PM Reply Like
  • daro
    , contributor
    Comments (1596) | Send Message
     
    maybe that is what the regs are covering? why do you think that is not included in the process?

     

    that is what happens when you get a blurb without the material facts.
    10 Sep 2012, 01:44 AM Reply Like
  • Tricky
    , contributor
    Comments (1583) | Send Message
     
    aristd -- my understanding is that it isn't so much an issue of what gets pumped in or how it gets taken out and disposed of (in and of itself), it's far more a concern if the casings are not properly done.

     

    The industry reverts to a standard talking point of "the process doesn't inject anything at the level of the actual reservoirs, we case the holes and inject far deeper". And that's true. And there are *usually* no problems (yet, anyway).

     

    The main problem is when the casing is not done properly and if there would be actual leakage into the reservoirs.
    10 Sep 2012, 12:08 PM Reply Like
  • nasdaqwoody
    , contributor
    Comments (166) | Send Message
     
    regulations are not the problem. Poorly written and enforced regulations are the problem. If a reg cost 200K per well to enforce, could you get similar results with a reg that costs 20K/well? Often times the answer is yes.
    9 Sep 2012, 07:11 PM Reply Like
  • woodyj
    , contributor
    Comments (48) | Send Message
     
    Marpy
    to equate fracking with catalytic converters is at the least, unintelligent.
    Converters remove contaminants from our air so maybe you won't get lung cancer, whereas fracking adds unknown quantities of harmful chemicals to the ground water, which is the source of your drinking water. Are you also anti NO smoking rules, etc. Get a life.
    9 Sep 2012, 07:39 PM Reply Like
  • 7iron10
    , contributor
    Comments (47) | Send Message
     
    I feel no guilt when saying this: I am sincerely confused as to whether you are being sarcastic or for reals.....either way, superbly written.
    10 Sep 2012, 01:22 AM Reply Like
  • HPBunker
    , contributor
    Comments (219) | Send Message
     
    Are we also to assume that there is no economic cost associated with contaminated groundwater? That's what economists call an externality. The nat. gas industry should look it up.
    9 Sep 2012, 08:21 PM Reply Like
  • Karam
    , contributor
    Comments (16) | Send Message
     
    @ARISTD>said "Serious problems HAVE occurred when the fracking water was "improperly disposed" of after the fact..." Did ya'all forget the E.P.A. Superfund Bill or whatever it was called... created on the backside of the industrial age.
    That statement has been "coming up" from the ground in old toxic buried drums and/or factories contaminated run-off water from as far back as I can remember at age 50. Someone will always try too "improperly dispose" to save $$. That's what "Big Fat Fines" are about.
    Now in steps "Economic Alchemy"... for the same reason gas lines disappeared so can/are/have Fracking Water issues. We did not suddenly find a huge oil well!... gas lines disappeared because a car got 20-25 mpg instead of 10-15mpg from Technological introduction of computer's, fuel injection, etc. This in effect nearly doubled the same oil reserves due to TECHNOLOGY! And the same with Directional Boring and as also same with Fracking. And the initial R&D of stuff is more expensive at the very start...the rest is history
    9 Sep 2012, 09:50 PM Reply Like
  • Karam
    , contributor
    Comments (16) | Send Message
     
    I just got to add also that just maybe they want to raise or push the price of Nat Gas because they own stock or futures whatever...all about the $$$$$$....And the water company's like HEK do it right and better and ya just got to love it.....Electric cars are just a delay or the TECHNOLOGY will improve and so on to a Nat Gas-Electric power ride..lol
    9 Sep 2012, 09:57 PM Reply Like
  • Brownskey
    , contributor
    Comments (15) | Send Message
     
    I live in N. Texas right on top of the Barnett Shale gas field. There are gas wells all around us. All of these wells were put into production by injecting a slurry of sand, water, and caustic chemicals into the well at tremendous pressures. What comes out of these wells is high pressure natural gas and warm brine. The brine is separated from the gas and returned to the depths in an injection well.
    In this county everyone's drinking water comes from underground aquifers. So, between the brine, chemicals, petroleum, natural gas and assorted industrial products used on drilling sites, we do have reason for concern. If our water becomes contaminated, the entire county will have little value.
    10 Sep 2012, 12:21 AM Reply Like
  • davidbdc
    , contributor
    Comments (3165) | Send Message
     
    I support the idea that companies should have to disclose any chemical being put in the ground on public land.

     

    I would question the part of the regulation regarding the process for oking the cement. How will the Federal Government do that in a timely manner? And I'll bet that those larger companies that make big campaign contributions will get inspectors on sight all the time - while the little guy will get the "we'll try to make it by Friday".

     

    If they want to have regulations regarding the cementing process and results - fine - make them and publish them and then do physical spot inspections and make fines and penalties real to discourage anyone that tries to skirt the rules for additional profit.

     

    I'm not in favor of many regulations, but the government should be the party ensuring that our water supply and land isn't being contaminated by drilling. But lets do it in a common sense way that provides actual results instead of just more stacks of paper.
    10 Sep 2012, 01:53 AM Reply Like
  • Karam
    , contributor
    Comments (16) | Send Message
     
    I live in FL. and been drinking purified water since the '80's...no oil wells around. Water is sold in stores next to coke...Don't matter where you live, water allover is what it is. But they know what to do and there are reg's...just that $$$ is short and why not gouge and then their happy. New Orleans gets their drinking water from the Mississippi...highest cancer rate in U.S....we can go on and on...
    10 Sep 2012, 08:41 AM Reply Like
  • JohntheOld
    , contributor
    Comments (176) | Send Message
     
    One of the biggest costs was a 3 day downtime on drilling rigs to ensure that the cement was cured enough to continue. Seems that cured concrete is a good way to prevent water table contamination. Also seems that EOG doesn't want to pay an extra 3 days rental on a rig.
    10 Sep 2012, 01:35 PM Reply Like
  • PalmDesertRat
    , contributor
    Comments (2935) | Send Message
     
    took some eog profits today at 115.08
    13 Sep 2012, 01:54 PM Reply Like
  • PalmDesertRat
    , contributor
    Comments (2935) | Send Message
     
    bot some eog today at 114.66
    18 Sep 2012, 02:03 PM Reply Like
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