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Gas fracking boom in Michigan goes bust

Concern over pollution and falling natural gas prices has slowed fracking-based drilling

DETROIT, | May 25, 2012

Concern over pollution and falling natural gas prices have slowed fracking-based drilling in Michigan, turning an expected boom into a bust, analysts say.

Fracking, the controversial practice of pumping chemical-laced water underground to fracture the rock and extract natural gas, has been practiced in Michigan for decades but the double blow of the pollution debate and falling gas prices have brought new fracking operations to a standstill.

"There is so much gas that we already (know) can be produced cheaply that exploring new areas and trying to commercialize them has ground to a halt everywhere," industry analyst Amber McCullagh told The Detroit News.

"Essentially, producers were victims of their own success," McCullagh, a senior analyst of North American gas research at Houston-based Wood Mackenzie, said.

"Costs for producing natural gas declined significantly and overall production increased rapidly. As a result, the price for natural gas declined from $12 to $13 per million British thermal unit in 2005 to an average of $4 in 2011."

Environmental groups have attacked fracking out of concerns for pollution, with one citizens' group -- Don't Frack Michigan -- attempting to ban fracking completely in the state.

"I think that a lot of people have been put to sleep in the sense that there are some environmental organizations that say we can do this through regulation," group co-chair Joanne Cromley said. "I don't think we can."

2012 United Press International, Inc. All Rights Reserved.


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