Report Back from Fracking Meeting in Allegan
This article was written by Nicole Berens-Capizzi.
A meeting took place in Allegan County on January 9 to “educate” local residents about oil and gas leases and horizontal hydraulic fracturing. This meeting was sponsored by Allegan Farm Bureau and the Michigan State University (MSU) extension office. The speakers included Bill Mitchell of the Department of Environmental Quality (DEQ), Curtis Talley, the MSU Extension Area Farm Management Educator, Luke Miller of Miller Energy (who is also a representative of the Michigan Oil and Gas Association), and a lawyer specializing in oil and gas leases. Later in the meeting this writer discovered that there were individuals from numerous environmental groups, including Michigan Land Air Water Defense (MLAWD) and a group from Fennville whose philosophy is to look for alternatives to fossil fuels. There were many farmers in the audience, some of whom were also involved with environmental groups.
Before introducing the speakers, the individual who began the meeting briefly discussed Michigan’s role in oil and gas production, saying that Michigan has over a trillion cubic feet of capacity for oil and gas. She said that because of landmen and individuals willing to lease their land for oil and gas exploration, Michigan ranks high in oil and gas production. In relation to landowners leasing their property for this purpose, she stated that “regulations can seem overwhelming to a person not used to dealing with them”. After this brief discussion, she introduced the speakers.
Bill Mitchell of the DEQ was the first presenter. Before beginning his presentation, he reiterated to the audience that the DEQ does not work for the oil or gas industry, and they are not paid by them. He stated that the DEQ’s job is simply to enforce the laws regarding oil and gas exploration. Mr. Mitchell showed a map of Michigan that highlighted where oil and natural gas wells are located throughout the state. Much of the activity was located on or near the Antrim Shale, where many vertical wells have been installed. Mr. Mitchell repeated on at least two occasions at the beginning of his presentation that what is happening in Michigan (in terms of oil and gas exploration) is not unlike what’s happening in other areas of the country. While this statement was likely meant to make the audience feel at ease with the whole process, this would be more appropriately seen as a warning given what is happening in other states such as Pennsylvania and Ohio.
Mr. Mitchell briefly discussed oil and gas wells in Allegan County, though he did not discuss specific locations. In his presentation he stated that Allegan County has 196 oil wells, 16 brine disposal wells, 10 natural gas wells, and 217 gas storage wells. In reference to “brine”, Mr. Mitchell repeatedly stated throughout his presentation that brine is nothing more than salt water and is not the same as the “flowback water” that contains all of the chemicals used in the fracking process. This confused many members of the audience, as was evidenced by the fact that throughout his presentation and others, people continued to ask for clarification of the term. For those of us who have studied fracking, “brine” is the term used by the industry to describe the flowback water, which includes not only salt but the chemicals used in the fracking process. While Mr. Mitchell claimed brine and flowback water are two separate things, later in the day he used the terms “brine disposal wells” and “flowback disposal wells” in reference to the same thing.
Included in Mr. Mitchell’s presentation was a brief discussion of the DEQ’s role in the oil and gas leasing process. He said that the first step for oil and gas companies is to obtain leases, and the DEQ plays no role in this. The DEQ gets involved when oil and gas companies seek a permit for “exploration” purposes, at which point the DEQ verifies that they have acquired mineral and surface rights.
Mr. Mitchell also made a distinction between hydraulic fracturing and horizontal and vertical drilling. In a nutshell, he said drilling is the first step and hydraulic fracturing is “a completion process”. He noted that there have been concerns about fracking because of “media attention” on the issue, and attempted to reassure the audience that fracking is safe because there are over 12,000 wells in Michigan and it has been done safely for years. After an audience member asked for more information on those 12,000 wells, Mr. Mitchell admitted that the majority of those wells have been vertically drilled, as opposed to the newer, horizontally drilled wells that people are even more concerned about. One individual said she thought it would be prudent for water quality tests to be done prior to this exploration, at which point Mr. Mitchell said that “it isn’t the DEQ’s job to keep track of the chemicals used, just to enforce the laws”. More questions from the audience followed. At the end of his presentation, Mr. Mitchell took a seat at the back of the room next to Mr. Miller.
Between presentations this writer observed a volunteer with MLAWD asking one of the individuals hosting the meeting if he could hand out information on MLAWD or put some of his flyers on the table with the other literature handed out for the presentation. The first person he spoke with referred him to one person, who suggested he talk to another person, and the third person he spoke with pointed him back to the first person he spoke with, at which point he explained that person referred him to them. In the end, they said he couldn’t distribute his flyers. The meeting already seemed pro-industry before, but this refusal to officially allow literature from another perspective made it seem even more so. To be fair, this writer also brought information to hand out at the meeting and did so between presentations and on lunch break without anyone stopping her.
The second presenter was Curtis Talley from the MSU extension. He stated that he has experience negotiating with oil and gas companies in Colorado. His presentation focused more on how a landowner can get the most out of their money, making a comparison between crop farming and being a mineral rights owner. Mr. Talley encouraged audience members to “treat underground resources the way you’d treat your above ground resources”, meaning that mineral rights owners should not be willing to accept the first offer.
Economics was a big focus of this presentation, but audience members continued to ask questions and raise concerns about fracking and the leasing process. One audience asked, “How public are lease rates?” Mr Talley responded, “Not very public.” Another person asked “Who’s our advocate?” “The person in the mirror,” was Mr. Talley’s response. The person replied, “No wonder they’re making so much money,” which made some people laugh. “That’s business,” responded Mr. Talley. Then someone asked “How much does it cost to ship it to China?” This question made people laugh even more, including the presenters. Mr. Talley didn’t seem to know how to answer this question, saying that the natural gas might have to be liquified, and also stating that “markets overseas for natural gas are higher than they are here”. Some individuals raised concerns about compulsory pooling should they refuse drilling on their property. Mr. Talley touted the “benefits” of compulsory pooling, saying that an individual will still get paid, albeit a lower percentage of royalties. Based on the research this writer has done, this statement conflicts with the stories of some individuals who have been forced into compulsory pooling. When asked about the involvement of banks when there’s a mortgage on the home, Mr. Talley said that banks typically love properties that are being explored for oil and gas because if a homeowner defaults on a loan, the oil and gas companies will pay for it.
The last two presentations occurred after a short lunch break. These two were also the shortest. Luke Miller of Miller Energy gave a brief presentation on the process of hydraulic fracturing, again making a distinction between vertical/horizontal drilling and hydraulic fracturing. Throughout this presentation he stated that drilling for oil and gas is safe and has been done in Michigan for many years without incident. One audience member brought up the hydrogen sulfide gas leak that occurred in northern Michigan a couple of winters ago. This presenter and the others diminished this event, stating that the levels of hydrogen sulfide in the leak weren’t enough to be toxic to humans.
The last presentation was done by a lawyer specializing in oil and gas leases. He made a disclaimer that he is not an expert on the topic (it is assumed he meant the topic of fracking), and also talked about his background growing up on a farm. Like Mr. Talley, he continuously stated that people need to know what they’re signing up for, and they need to do their research first. He admitted that landmen will sometimes use tactics that make the landowner feel like they are required to sign a lease, and they will even pit neighbors against eachother. An individual asked if there was a way for a landowner to look up specific landmen in order to know their tactics, but the presenter said there wasn’t. While this presenter talked a bit about environmental concerns, the majority of the focus was on the economics of leasing and how to get the most out of a lease.
There was a question and answer period after all of the presentations were done. Members of the audience continued asking questions about environmental concerns related to fracking, and this seemed to bother Mr. Mitchell. When one audience member raised concerns about gas companies not cleaning up toxic spills, Mr. Mitchell snapped at this person, saying that gas companies are required to clean up any spills. It is worth noting here that most fracking sites are exempt from superfund laws, meaning they are not legally obligated to clean up any spills resulting from their operation. This same audience member mentioned that gas companies are exempt from the Clean Water Act, and Mr. Mitchell snapped back that they are not exempt. For the record, gas companies are exempt from certain key provisions of the Clean Water Act. Another person made reference to all the chemicals used and how some of them are “trade secret”. Mr. Mitchell denied that any of the chemicals are trade secret and said a list of chemicals used are available on their website.
Overall, this meeting was a disappointment for those hoping to learn the facts about fracking and how landowners are impacted. As someone who has studied the impact of fracking on farmers and communities, this meeting was particularly disappointing because these concerns were not addressed, yet the audience was full of individuals for whom these issues are very relevant. The meeting was clearly biased toward the oil and gas industry, as evidenced by the lack of useful information on fracking, nondisclosure agreements, and health issues, to name a few concerns, not to mention the dismissal and/or denial of concerns brought up by audience members. That being said, it was very encouraging that there were more than a handful of individuals that continued to ask questions about some of the issues the speakers were avoiding discussing.