Fracking — the controversial practice of blasting water, sand and chemicals underground to free up oil and natural gas — isn’t done in Georgia. The state, after all, doesn’t produce a drop of commercially viable oil or gas.
Georgia companies, nonetheless, benefit mightily from the nation’s burgeoning fracking industry. Five specialty kaolin mines across mid-Georgia have opened the last two years to supply the sand needed for fracking, or hydraulic fracturing done in other states. A re-opened factory in Cartersville makes tanker cars to carry gas from field to pipeline.
AGL Resources builds pipelines to carry the gas to market. Georgia Power plans power stations to push the gas through the pipes. New pipelines across Georgia, including a 106-mile mile line from Newnan to Dalton along Atlanta’s western edge, are under federal review.
“The increase in U.S. oil and gas production has been real beneficial to our business and folks out here,” said Joe Renzetti, president of Roper Pump which makes drill parts at its factory in Commerce, about an hour north of downtown Atlanta. “It provides good jobs. At the end of the day, it makes a big difference.”
Fracking, though, raises the hackles of environmentalists who decry its effect on groundwater and say it impedes development of renewable energies like solar. Georgia opponents also include landowners in the proposed paths of two major pipelines running along the state’s western flank.
“I have little ones and I may want to move at some point and sell my house and I’m concerned I may not be able to,” said Ian Goldenberg, whose five acres west of Newnan would be bisected by the pipeline. “They say the pipeline will have no effect, of course. But there’s no way to prove it.”
Hydraulic fracturing is the practice of blasting water, sand and chemicals underground to break apart shale rock and let natural gas flow from it into the well. Along with new, specialized horizontal drilling techniques, fracked gas has revolutionized the extraction business and turned the United States into the world’s top gas producer.
The Energy Information Administration predicts overall U.S. gas production will nearly double by 2040, with most of the growth due to shale gas.
One huge field stretches from Alabama through northwest Georgia. Forestar, a Texas land developer, gobbled up mineral rights near Rome two years ago with plans to tap natural gas deposits as much as 14,000 feet below ground. But it never drilled a well on the 67,000 acres under mineral contract.
Jerry Spalvieri, an Oklahoma wildcatter, drilled two wells outside Dalton but has no plans to sell the gas, oil and methane that bubbles up. Canadian geologists visited Atlanta in August to peruse geophysical logs detailing shale oil reserves across Southwest Georgia. Their company, though, hasn’t been heard from since.
Gas prices are too low to reward drilling in Georgia. Jim Kennedy, the state’s geologist, says it isn’t worth the cost of exploration, production and shipment for a market price below $4 per thousand cubic feet.
“It’ll have to be about $6 per thousand cubic feet before we get any action here in Georgia,” he said. “And with the price of gas going down, it’ll be five, maybe seven years before we even get close to that price.”
Low prices and strong supply boost pressure to export gas. Shell and Kinder Morgan, a pipeline company, plan to spend $1.5 billion turning a liquefied natural gas import facility near Savannah into an export hub. Construction on the Elba Island processing plant could begin by mid-2015 with shipments flowing by 2017.
Atlanta-based Georgia Power is on board the export bandwagon. Reversing Elba Island’s natural gas flow to handle exports would require 180 megawatts of power generation and would transform the facility into one of the utility’s largest industrial customers.
Georgia Power and its affiliated utilities across the South generate about 40 percent of their power from gas, a substantially larger amount than just a few years back. As reliance on coal recedes, the utilities expect to boost natural gas supplies.
Plant Yates in Newnan, for example, is scheduled to stop burning coal next April and could use gas delivered via the proposed pipeline. Oglethorpe Power in Dalton, at the other end of line, owns a gas-fired plant.
“With the exception of the recession period, North Georgia has shown robust growth,” said Hank Linginfelter, an executive vice president with AGL. “We’d like to see more infrastructure in Georgia; we think it’s important for other areas too.”
Gas from Pennsylvania and West Virginia, as well Texas, would flow along the major East Coast pipeline, get off-loaded at Newnan before being pumped north to Dalton. Construction by Tulsa-based Williams Partners could begin next year with gas flowing by May 2017. AGL Resources is ponying up $200 million for the project.
Williams says 90 percent of the proposed route would follow existing utility corridors – mainly below power lines – and cause little damage to property or the environment.
But the proposed route in Resaca, just south of Dalton, would run right through Jeff DeFoor’s soybean field. Though owners of property used for the pipeline are compensated, “I know it’s a small risk, but it’s a potential disaster,” said DeFoor, whose 200-acre farm is leased for row crops.
“Maybe it won’t happen for 40 years, but we’re passing this potential catastrophe on to our grandchildren.”
The much longer Sabal Trail pipeline is planned for a large swath of Southwest Georgia. It would cross hundreds of miles of farmland, rivers, swamp and parts of Albany and other towns. Opposition from Ted Turner, who owns Nonami Plantation outside Albany, and others, is fierce.
“The fossil fuel industry, long term, is not a sustainable industry and right now we can create power and jobs (via) renewable energy without sacrificing our air, our water and our health,” said Colleen Kiernan, director of the Sierra Club in Georgia.
Fracking brings jobs too. IHS, the information and consulting firm, reported two years ago that nearly 1,000 Georgians are directly employed in companies that service the shale gas industry. Another 5,000 are indirectly employed. More than $100 million in economic impact derives from the fracking industry in Georgia too, IHS says in the industry-commissioned report.
The numbers aren’t huge, but have probably grown since 2012. Roper Pump, for example, has hired 60 workers the last few years, according to president Renzetti. Chart Industries, in Ball Ground, makes containers to store and transport liquids.
Trinity Industries shut its railcar factory in Cartersville five years ago and laid off 600 workers. In May, according to local news reports, the company reopened, rehired workers and began filling a backlog of 40,000 rail cars needed to transport natural gas and other fuels. Trinity, based in Dallas, Texas, declined comment.
Support real journalism. Support local journalism. Subscribe to The Atlanta Journal-Constitution today. See offers.
Your subscription to the Atlanta Journal-Constitution funds in-depth reporting and investigations that keep you informed. Thank you for supporting real journalism.