Here’s a recap of the recent Northern Colorado Energy Summit from Kay McDonald writing for the Big Picture Agriculture blog. Here’s an excerpt:
Today, natural gas costs about four times as much in Europe as here in the U.S., and even more in Japan. In the U.S., for an equivalent amount of BTUs, crude oil costs three to four times as much as natural gas, which is driving a switch to the use of CNG and LNG to power our transportation, especially the heavy fleets and rail. It has replaced coal to generate electricity in power plants, too, reducing emissions and making it possible to integrate green energies like wind and solar more easily.
Keynote Speaker John Harpole
Our first energy summit speaker was John Harpole, President of Mercator Energy LLC. Next, are a few of his key statements.• “Horizontal drilling technology is the biggest discovery since the splitting of the atom,” he said. The technology allows us to drill down two miles and then horizontally two miles and hit the target the size of a refrigerator. This gives us the ability to tap into an estimated 1,073 trillion cubic feet of gas in shale (nearly half of this country’s traditional potential natural gas resources).
• All of the drillers want the wet liquids and need a way to “get rid” of dry natural gas.
• The new energy supplied from fracking reduces the likelihood of price spikes here in the U.S.
• “The demand curve responds to the supply curve.”
• The technology has changed the situation from one that is “no longer exploration, but manufacturing.” We now have a “gas factory.”
• China believes that they have three times the reserves we have and they will be going after those reserves through fracking, too.
Water Panel
Part of my reason for attending the summit was to hear what they had to say about water use here in Colorado, so I sat in on the water discussion panel.Tom [Cech] of Metro State University in Denver, told us that one fracking well uses 3-5 million gallons of water, or about the same as 30 households use in one year. (A well can be fracked multiple times.) Because of the recent drought in Colorado, water shares have increased in price to $17,000 this year from $7,000 three years ago.
While the water panel spent much time telling us that the future trend will be reusing produced water from fracking, you only get 20 percent of water back in a shale frack. The representative of the company, High Sierra, told us that there are many patents out there for processes to reuse water, and do it economically. He told of a water reuse pilot project going on in Denver which is testing produced contaminated water from Pennsylvania, shipped to Denver by rail car.
All three of the panelists expressed concern over the fact that agriculture is always the source of water purchases from both the energy industry and urban growth, since the farmer cannot compete economically for the water. They acknowledged that this means less food security for everyone and that agricultural water needs to be protected, that this is a problem.
The entire discussion centered around water shortages, over-allocations, and increasing prices, especially when the future population growth along the front range of Colorado is taken into consideration. Additionally, in Northern Colorado we used to get our snow-melt water runoff in June, but now it happens in April or May.