walter russell mead peter berger lilia shevtsova adam garfinkle andrew a. michta
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When It Comes to Fracking, Bigger Is Safer

Drilling giants like Exxon and Shell are safer and more ecologically responsible than their smaller competition. In many industries, scaling up production actually leads to more mistakes and quality control issues, but oddly enough, when it comes to fracking shale in Pennsylvania, bigger companies violate regulations the least. The WSJ reports:

As big energy companies buy out smaller rivals, one side effect is an improving environmental record, according to a Wall Street Journal analysis of Pennsylvania records.

The state offers a glimpse of the direction the U.S. drilling boom may be headed in Texas, North Dakota and elsewhere, as Big Oil increasingly takes over from the smaller, risk-embracing but often cash-strapped companies that pioneered tapping oil and gas from shale. Regulators and some environmentalists say the multinationals bring more rigorous approaches, mindful that one big mistake can affect their ability to operate everywhere. Superior financial resources allow them to wield teams to analyze and reduce violations as they carry out the complex process needed to unlock oil and gas trapped in shale.

Smaller companies take more risks. They innovate, and it was on their backs that the shale boom was built. But now that the resource is less of an experiment and more of a sure thing, big oil and gas companies are consolidating wells and buying out the wildcatters.

Unsafe fracking costs companies like Shell, Exxon and Chevron much more than lost potential resources, clean-up bills and government fees. These big companies care deeply about their public image. They have brands to protect and the funding to protect them. For them, an ounce of prevention is worth a pound of cure.

Large companies also have the resources to frack safely. So far, the numbers indicate that the Pennsylvania shale culture is changing. Companies big and small over the past two years are violating regulations less than before.

Bigger, safer fracking is excellent news, because the American shale revolution is showing no signs of slowing down.

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  • http://www.facebook.com/quandle Evan Seitchik

    WRM is on point as usual when it comes to energy in the states and beyond. I’ve always believed that with smart regulation and a reasonable amount of capital invested in safety measures, natural gas can be safely and profitably extracted. Large companies are well poised to make those investments and take over from the “Mom and Pop” fracking operations that are most likely to cause spills, store wastewater in open pits, dispose of wastewater at treatment plants unsuited for industrial waste, drill earthquake-inducing salt water sequestration wells, and indulge in other such completely avoidable environmentally destructive behavior to “cut costs.”

    Soon, the NIMBY folks will have a lot less to go on in their crusade against natural gas.

  • rheddles

    The energy companies know that if they screw up and have a major environmental disaster in PA the game is over in the Marcellus. So they have every incentive in the world to figure out how to do it correctly and follow the rules. And they are. After a few years of disaster free operation, more and more people in New York will start to wonder why they are missing out on the potential pay day.

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