By Allen Best
Technology has produce a bonanza of oil and gas. But many want assurances that water resources are not being harmed.
Whatever you may think about oil and gas drilling, acknowledge this much: The technology is jaw-dropping. A decade ago, library shelves were sagging with books foretelling declined production of oil and natural gas. Guess what? In July 2013, the International Energy Agency announced that the United States will become the world’s leading producer of natural gas in 2015 and the world’s leading producer of oil in 2017.
The technology driving increased production isn’t altogether new. Hydraulic fracturing was first used in Colorado in 1948. The application of water, sand and chemicals at high pressures to stimulate production is called by the industry and regulators a “frac.” To journalists, that spelling looks unkempt, so the news outlets call it a “frack.” To opponents, it’s a four-letter word no matter how you spell it. What’s different between those original fracks and those currently done an average of five times every day in Colorado is like the chasm between the first Apple computers and MacBooks today: the new versions are immensely more powerful—and more precise. Instead of pumping fluids by the thousands of gallons, as the first fracturing jobs did, today companies commonly use more than 5 million gallons of water to “shoot” deep rock layers and fracture them. Tiny fissures smaller than a follicle of hair are formed and propped open by sand particles and other “proppants,” allowing the oil and gas to escape out of the rock and into well casings. Fracturing chemicals, which constitute less than 1 percent of hydraulic fracturing fluid’s total volume, are used to improve effectiveness. Many are ordinary, benign household or industrial substances, but some are known carcinogens and other toxins, raising concern about potential impacts to water quality.
How Companies are Pursuing and Acquiring Water to Power Colorado
By Caitlin Coleman
In July 2012, the city of Aurora stopped negotiating. They had exchanged their last term sheet, and the city council voted eight to three in favor of striking a deal—the Anadarko Petroleum Corporation could lease water from Aurora for five years, with an option to extend for another five.
Suddenly the Front Range was buzzing with news of the lease. Some papers ran just the facts: Anadarko would pay the city a healthy $9.5 million total, or $1,200 per acre foot of water, receiving 1,500 acre feet each year. Other stories featured the emotional side—the worries and upset of citizens.
“We were surprised at the response, because, when you stripped off the uses of water, it seemed like a normal deal with many of the same elements as before,” says Lisa Darling, Aurora Water’s program manager for the South Platte River Basin, who negotiated the deal.
It was normal, in that Aurora leased some of its excess water supply—a customary practice for the city. But the end-user here, Anadarko, will employ the water in oil and gas development, using it for drilling and hydraulic fracturing in Weld County. This was new for Aurora.
Recent years have heralded other negotiations that link water rights holders to energy or power companies, with varying outcomes. Both energy companies, which extract natural gas, oil, coal, uranium or other energy-producing minerals, and power companies, which use those fuels or renewable sources to generate electricity, require water for their operations, which in Colorado means access, in some form or another, to a water right.
Water rights for energy are nothing new. In fact, Colorado’s prior appropriation system, commonly summed up as “first in time, first in right,” is rooted in early hardrock mining, where it was first applied. This system, now administered across all “beneficial uses” of water in the state, allows for those with older, senior rights to use water before those who hold newer, more junior rights in times of shortage. Although power plants have been around for decades with water rights of their own, their water supply portfolios are changing, while oil, natural gas and coalbed methane production has been growing in a fast, new fashion. All require water.
