Normally, I entertain you with rather dry, technical topics relating to investing and finance. I thought I would change direction dramatically and entertain you instead with a dry, technical discussion relating to geology, in honor of the 374th birthday of Nicolas Steno, “The Father of Geology” (I know about this thanks to Google’s Doodle on the 11th – it’s not like it was on my calendar or something).
Fracking has been in the news a lot lately, as reports of contaminated groundwater have bubbled to the surface in areas where fracking has been employed. In case you don’t know, fracking is a process wherein oil and gas reservoir rocks are fractured and injected with sand, water and chemicals in order to get more hydrocarbons out of the ground. I just read that they are now entertaining the idea of “super fracking” which sounds like it will be well-received by critics. Oilfield services companies are also trying to refine the current fracking process – one company has actually developed something called “disintegrating frack balls” that turn into powder like an Alka-Seltzer tablet, according to one description. Boom, boom, fizz, fizz, oh what a big crack it is…
Why all the fracking? Basically, energy companies have recovered a lot of the easy-to-get hydrocarbons and are now looking toward reservoirs that are known to contain oil and/or gas, but won’t give up their precious contents quite so easily. Oil and gas are found in sedimentary rocks, which may generally be categorized as sandstone, limestone, or shale. These rocks have varying degrees of porosity and permeability – the former measures the size of the spaces in between the individual grains, and the latter measures how interconnected those spaces are. Sucking oil and gas out of a highly porous and permeable rock will be relatively easy, whereas getting it out of a rock with low permeability will be difficult – the hydrocarbons will remain locked inside the reservoir rock. Shales are notoriously impermeable, thanks to the size and shape of the mineral grains. This is where fracking comes into play – the rock is fractured and the cracks are propped open with a more permeable substance, like sand, which allows the hydrocarbons to flow out of the reservoir and up the well bore. As it becomes harder and harder to find and develop reserves, you can see how technologies like fracking will become increasingly important to energy companies. Still, nobody wants to be able to light their tap water on fire. Hopefully, critics and proponents will be able to find some sort of middle ground, preserving our precious groundwater while enabling energy companies to retrieve the resources we need.
Sarah DerGarabedian, CFA
Director of Research