It's official: Natural gas, newly abundant, is in line to become king of the U.S. energy scene. A fresh ExxonMobil forecast says that by 2025 natural gas will replace coal as the leading fuel for generating electricity in the U.S. Worldwide, by 2040 gas rises to No. 2 in the overall fuel mix, which includes oil used in transportation.
So - what rules will North Carolina adopt for the next ruler of the energy world?
The question might not seem relevant. Due to the drilling technique known as hydraulic fracturing ("fracking") of hydrocarbon-rich shale rock formations, coupled with advances in horizontal drilling (which accesses wide areas from a single point), parts of the U.S. are experiencing shale gas bonanzas. They include areas in the East, notably Pennsylvania. And yet, there's no shale gas drilling in North Carolina.
Fracking isn't allowed here, and though an underlying shale formation in counties such as Chatham, Lee and Moore shows promise, it's not as much of a sure thing as "plays" elsewhere. Given generally declining natural gas prices (largely because of increasing shale gas production), fracking in North Carolina may not prove to be a going proposition.
Still, some gas companies have been hot to lease potential drilling sites, and this year's legislature ordered the state Department of Environment and Natural Resources to study how - not whether - shale gas production can be carried out.
Water, water everywhere
That study is under way. Here's hoping it's honest and comprehensive. But to produce a policy on shale gas that truly protects residents while opening the way to a home-grown, relatively clean-burning energy source if drilling here proves feasible, North Carolina needs to do more than study the technical issues.
As an example, consider water. The state needs to get proper policies in place regarding water use (the initial fracking process uses tons of water), wastewater disposal (gas wells that have been fracked put out contaminated water throughout their lifetimes) and to protect water wells relied upon by homeowners and businesses.
As Duke University researchers have pointed out, it's vital that residents' drinking water sources be analyzed before drilling takes place, so any subsequent changes in the water can be evaluated based on actual data.
Also, North Carolina needs a "presumptive liability" policy to protect homeowners near drilling sites. In a defined zone, say, within 3,000 feet of a well, the driller is then presumed liable for water-quality degradation unless he can show otherwise.
The dotted line
Then there's the issue of leases. The New York Times recently surveyed tens of thousands of leases that landowners have signed with shale gas outfits. Most are on balance favorable to the companies, and many omit clauses that protect landowners.
For example, a lease may be written so as to allow a company to place drilling waste pits on a landowner's property, or let the company sell or transfer the lease to a third party. Leases may omit protections such as language that makes the company, not the landowner, explicitly liable for any harm caused by drilling.
"With a gas lease, you're permitting industrial activity in your backyard" as well as initiating a legal relationship that may last for decades, notes one lawyer who specializes in landowners' leasing rights.
North Carolina, if it is to embrace shale gas drilling, needs to be among a group of states that, as the Times story reported, "specifically require companies to compensate landowners for damage to their properties or to negotiate with them about where wells will be drilled, even if the lease does not provide those protections."
The natural gas revolution is real, and the fuel's use as a replacement for coal is a good thing. But there is much to consider before the drill bits bite deep into the rocks under central North Carolina.