The Truth About Our Oil

Jaime and Pam Duran occupy the last house on a dead-end dirt road in Golden Gate Estates, a log cabin-style home on five acres where they grow guavas and citrus, herbs and vegetables. The property abuts farmland—a sweeping expanse of green rimmed by forest. Watermelons grow there. On a mid-January afternoon, the developing fruits sit in complete silence—no human activity, no traffic, only the rush of the wind.

In a way, each little melon is a trophy for the Durans and their neighbors—and, they might argue, for all of Southwest Florida. That patch in 2013 had been slated to turn into an oil field. The landowner, Collier Resources, had leased the property’s mineral rights to a Texas company that anticipated striking oil below. Residents discovered the plan by way of a notice stuffed in their mailboxes informing them they were in an evacuation zone. No Collier well had ever been permitted so close to homes.

That was news enough, but the story got bigger. Around the same time, newly galvanized Collier residents stumbled upon another drill site, the Collier-Hogan well, south of Lake Trafford. There, the same firm, the Dan A. Hughes Company, had performed an operation to force oil out of a reservoir about 2 miles underground. A Department of Environmental Protection (DEP) independent consultant later determined the procedure to be hydraulic fracturing. “Fracking”—the nation’s new “F” word—had come to Southwest Florida.

Residents suited up for a fight. One grassroots advocacy group, the Stonecrab Alliance, organized protests, letter-writing campaigns, a march on Gov. Rick Scott’s Naples home. Another resident group, Preserve Our Paradise, filed a public records lawsuit to compel the DEP to come clean about what had happened at Collier-Hogan.

“It became a groundswell to where everyone, regardless of what their political affiliation was, if you lived in Collier County, you had a vested interest of this,” says Joe Mulé, president of Preserve Our Paradise and a Golden Gate Estates resident.

“We were relentless,” says Karen Dwyer, the Stonecrab Alliance founder.

They won.

By July 2014, Dan A. Hughes had withdrawn its application to drill near Golden Gate, plugged the Collier-Hogan well and left the state.

“We decided to do everything we could,” says Pam Duran, explaining that the couple had contemplated moving before resolving to fight. “Then we could live with ourselves, knowing that we did everything, and if it still went through, we’ll have that peace of mind.”

She and her husband breathe easier these days, but they know the matter isn’t over. Those two wells unleashed a debate—long overdue—about the oil industry and its future in Southwest Florida.

Drilling has been going on in Florida since oil was discovered near Immokalee in 1943. Much of it occurs out of sight, in Big Cypress National Preserve where the federal government and its many environmental regulators signed off on a deal years ago shielding the 729,000 acres from development but allowing native tribes, property owners and mineral rights holders to continue their pursuits—including energy extraction.

“This is nothing new,” says Collier Commissioner Tim Nance.

Maybe not. But the context—and the implications—of drilling have changed considerably.

American energy production, on the decline for decades, is booming. A resurgence, born in the shale formations in the North and West, is winding its way south. Techniques such as horizontal drilling and hydraulic fracturing have allowed energy producers to unlock billions of barrels of oil and natural gas previously trapped in rock.

The energy rush has propelled the U.S. to the top of the world’s oil producers—and boosted domestic production to 60 percent of the nation’s oil needs and 100 percent of its natural gas ones. Florida doesn’t have shale, but new techniques may allow drillers to extract more from the Upper Sunniland Trend and tap into the lower, deeper one. The Sunniland is an oil reservoir that runs from Fort Myers to Miami.

New seismic surveying technology, moreover, enables oil prospectors to more accurately pinpoint potential reservoirs. That’s the next step in Collier: About 200 square miles in Big Cypress and near Immokalee are slated to be surveyed, pending approval of the applications. The findings will determine the industry’s next steps.

What will that mean for Southwest Florida?

The Dan A. Hughes controversies unleashed a torrent of questions and concerns about water safety, environmental protection, residential rights, regulatory safeguards and waste disposal—matters being hotly debated around the country.

But as the story gets told in Pennsylvania, Texas, Oklahoma and now Southwest Florida, the plotline and characters have lapsed into archetypes—money-grubbing energy firms; self-centered mineral-rights owners; victimized residents; noble environmentalists; hapless bureaucrats. That phenomenon makes objectivity and discourse difficult.

“When you’re in a public meeting and there are 200 people in there, and everyone is yelling and screaming, you’re not going to get anything done,” says Tom Jones, senior vice president of Collier Resources, which owns most of the mineral rights in eastern Collier County.

Headlines, newscasts and social media shares defined the story before it even got here.

“I’ve had citizens come in here who were absolutely terrorized by just the discussion of it,” Nance says. “We’ve tried to get the discussion over to a fact- and science-based discussion so people can really come to grips with what we have here and understand it.”

Concerns about fracking are not unfounded. The practice, blamed for everything from water contamination to earthquakes, has been banned in places ranging from New York to Scotland and Wales to the city of Denton, Texas, in the Barnett Shale. “We cannot afford to make a mistake,” New York’s acting state health commissioner Dr. Andrew Zucker told The New York Times. “The potential risks are too great. In fact, they are not even fully known.” In Florida, industry excitement over new strategies must be weighed against the billions in taxpayer dollars spent on Everglades restoration.

Settle in, then, for something akin to a public Q-and-A session. We don’t have all the answers, but we hope we can at least separate some of the myths from the realities, examine the biggest risks and inform residents in a way that allows them to push for appropriate safeguards to the environment, their neighborhoods and our area’s unique way of life.

How has drilling changed?

The industry used to simply install vertical wells, straight lines from surface to reservoir. Vertical drilling doesn’t require much in the way of water or chemicals, but it’s limited: You can only suck up so much oil going straight down.

More recently, the industry figured out how to drill sideways. Engineers shoot multiple spokes off of a vertical shunt, following the strata. These new wells yield as much as four times the volume of their predecessors. Horizontal drilling made hydraulic fracturing possible; however, not all horizontal wells are fracked wells. Since 1992, 30 wells have been drilled horizontally in Southwest Florida.

Horizontal wells require more water than vertical ones, and some environmental groups question whether drilling could pose a risk to Florida’s bedrock, but this development limits the number of wells needed.

What is fracking, anyway, and is it dangerous?

In hydraulic fracturing, workers shoot a highly pressurized mixture of water, sand and chemicals into horizontal well legs, creating fissures in the rock. The sand props open those fractures, and oil oozes from their geologic holding pens up the wellbore.

The fissures themselves may not be problematic. The cracks travel between 10 feet and 100 feet, says Richard Lewis, principal engineer with Conestoga-Rovers & Associates who studied the Dan A. Hughes procedure on behalf of Collier Resources. Oil in the Lower Sunniland is separated from the surface by about 2 miles’ worth of anhydrite rock and minerals layers and the Boulder Zone, a cavernous, saltwater-filled space stretching from Orlando to the Keys.

“(Florida) is probably the safest place in the United States to frack,” says Jones, citing those factors. “I’m not supporting fracking, but geologically, from a technological perspective, you couldn’t find a safer place.”

Hold on, insists Jennifer Hecker, natural resource policy director at the Conservancy of Southwest Florida.

“The bottom line is Florida is completely different geologically and hydrologically from other parts of the U.S. where this is being done. So even if this technique is ‘proven’ in North Dakota, it is not proven in Florida limestone and interconnected aquifers,” Hecker says. Her organization is calling for a moratorium on new extraction techniques until its experts see more evidence validating their safety.

State Sen. Dwight Bullard, a Democrat who represents part of Collier County, wants to halt the practice. “When we talk about Southwest Florida, you are right there at ground zero when it comes from the intersection between the Gulf, the Everglades and your population centers in South Florida.”

Florida law contains strong provisions for property rights, and one would have to explore whether a fracking ban would violate the Bert Harris Act, which preserves land-use rights.

Is anyone fracking in Southwest Florida?

Not right now, Jones says. Drillers are focusing on infield development—extending horizontal legs off of existing vertical wellfields in the reef-like Upper Sunniland where fracking isn’t necessary.

Does the state regulate hydraulic fracturing and related procedures?

Minimally—and this is perhaps the greatest area of concern to residents and others worried about new drilling techniques.

Companies wishing to frack or use related well-stimulation techniques don’t need a permit to do so; rather, they inform the Department of Environmental Protection that they plan to do a “workover.” The department can ask them to hold off—that’s what happened when DEP officials filed a “cease and desist” order at Collier-Hogan well—but the penalties for disregarding the DEP are minimal and the current statute lacks teeth, according to environmental advocates.

“Our current statute is so permissive it gave me great pause,” Bullard says.

Does the county have any regulatory power?

Not really. The county does prohibit drilling in residential areas (the Golden Gate well was just outside the subdivision’s borders). Otherwise, the permitting and oversight process is in state hands.

Commissioner Tim Nance thinks that’s how it should be.

“Sometimes people want to say, ‘We need local control of this,’ but I actually think that’s a very bad idea,” he says. “We neither have the staff nor the expertise nor the funding to engage that at the level that needs to be applied.”

But, now that drilling is on the radar, residents can expect to see increased communication among state regulators, industry executives and county emergency managers, Nance says. The commissioner also says he’ll push to make sure wells are positioned far enough from homes that residents won’t be living in evacuation zones.

“It shouldn’t be drilled that close to residences. This is common, ordinary sense,” Nance says. “But it hasn’t been contemplated because it’s never occurred.”

How much water does fracking use?

A lot—but not as much as one might think.

The Collier-Hogan well’s five-year permit allowed the use of 287 million gallons of water—a figure that stunned residents and environmental groups.

That was not the amount it used.

The Florida Department of Environmental protection allots water usage based on a driller’s potential peak daily use. That one-day maximum is extrapolated out to a monthly, and then annual, use. Before issuing the permit, DEP officials run models to determine what would happen to the aquifers if a driller were to require that amount, Jones explains.

The actual water use at the Collier-Hogan well was 10 million gallons, Jones says.

That is not to say water use shouldn’t be a concern. Once used for drilling, the water can’t be reused—except to be recycled for a finite number of other drill jobs.

“There are a lot of municipalities that are having to pay to upgrade to alternative water sources in order to meet residential water supply source needs. They are having to go to brackish sources, and we are letting our fresh, cheap water be used for an industrial purpose,” Hecker says.

Water use must be considered through various lenses: A 2013 DEP regional water supply report predicts that demands for fresh water will increase by 1.3 billion gallons per day statewide by 2030 and says that traditional sources of groundwater will not be sufficient to meet the need. On the other hand, the federal Environmental Protection Agency (EPA) estimates that Floridians use between 76 and 100 gallons of water per day.

What kinds of toxic waste result from drilling?

In the case of hydraulic fracturing, some 98 percent of the drilling solution is made up of water and sand. Two percent is chemicals.

Some of the substances, like hydrochloric acid, are fairly ubiquitous in industrial applications. Mixed with Florida’s limestone base, the acid and the base convert into salt and are absorbed into the soil over time.“It’s first-year chemistry,” Lewis says.

But environmental and resident groups say there are more insidious chemicals in the hydraulic fracturing wastewater, known as “flowback”—even in small amounts. They include benzene, toluene, ethyl benzene and xylenes—compounds that can damage organs and the nervous system.

Also posing a risk is “produced water” or “brine”—water that mixes with oil deep underground and is brought to the surface during extraction. For every barrel of oil that’s extracted, six to 10 barrels of produced water comes up with it, according to the EPA.

These energy-related wastewaters are exempt from the Safe Drinking Water Act, a provision written to the law during the Bush administration and dubbed the “Halliburton loophole,” referring to the energy giant once led by former Vice President Dick Cheney.

The state can write its own more stringent water safety regulations, a matter that some residents and environmental groups say must be considered. Preserve Our Paradise is pushing to make the Floridan Aquifer, a drinking water source for Florida and parts of four other states, a so-called “sole-source aquifer,” a designation that would allow further safeguards against pollution.

Meanwhile, state Rep. Ray Rodrigues, R-Estero, is filing—for the third time—a chemical disclosure bill. “Our bill would be the most strict disclosure requirement in the county,” he says.

Can toxic water and oil infiltrate the aquifers?

Yes. Experts say there are three primary scenarios: through old abandoned wells, surface spills and engineering failures. With precautions, though, the threats can be minimized.

Boreholes

Southwest Florida is littered with boreholes—old wells from the 1940s and ’50s. They were sealed off to the requirements of the day, lenient by today’s standards, and some of the plugs that protect aquifers from oil and brine are missing or corroded.

“The concern is they could potentially act as straws, allowing for the upward migration of these fluids into the drinking water,” says Hecker of the Conservancy.

The Collier-Hogan well was sunk within a mile of two old wells. In that particular case, three consultants say contamination from them was “highly improbable” if not impossible. But two of the firms advised further investigation of the region’s abandoned wells.

Mark Stewart, professor emeritus in the University of South Florida’s geosciences department, did a water study a few years ago along County Road 951 where his team ran across an area of high electric conductivity near the surface—an unusual occurrence that he later theorized was electrically charged brine rising to the surface via old wells. Fracking could further trigger such fluid migration, he says.

“Unless we know where all the wells are and if they’re properly abandoned, that’s a potential pathway for contamination of a shallow aquifer,” Stewart says.

The Conservancy is asking the state to enforce a perimeter around the boreholes or require drillers to re-plug them to today’s standards.

Spills

Statewide since 1972, 1,281 barrels of crude oil and 16,636 barrels of brine have been spilled in Florida, according to a report from the consulting firm AECOM. There apparently was some sort of ground-level “release” at the Collier-Hogan well, according to another firm, ALL Consulting, which could be worrisome since chemicals were used there. (There was not enough information to know whether the spillage affected water-table aquifers; state monitoring continues.)

In fairness, there’s an asterisk: The total quantity spilled amounts to 0.0002 percent of all oil ever produced here. A spill isn’t expected to move much, according to Lewis, the CRA engineer. His modeling suggests that, under worst-case scenarios, it might creep 1,500 feet in 10 years.

Nevertheless, the fragility of Southwest Florida’s ecosystem—and the fact that Collier’s aquifers lie close to the surface—makes this an important matter to monitor. That’s why there’s a push for more DEP oversight authority—right now, state inspectors must get the permission of the energy companies and the property owners before they can enter a well field.

Well failures

Engineering failures to the well casings—protective sheaths around the wellbores—are the third big risk.

One study of the Marcellus Shale in the eastern U.S. found 83 examples of cement casing failures in 573 wells. State records from 2010-13 show Pennsylvania wells failed at rates of 3 to 6 percent in their first three years of life, according to recent report The Environmental Costs and Benefits of Fracking conducted by seven government and university environmental scientists.

But the industry can do it right, Stewart says, citing an Environmental Defense Fund study showing that well-constructed casings fail 1 to 2 percent of the time. “A 1 to 2 percent failure rate is not bad,” he says. “That’s what the industry is capable of, but at the moment, there’s no economic or regulatory incentive for them to try to achieve that.”

Well casings are addressed in regulatory proposals heading to the legislature.

What happens to wastewater?

Oil and gas wastewater—along with household and industrial wastewater, septic sludge, motor vehicle waste and other liquid cast-offs—is being disposed of underground in injection wells, holding pens for toxic byproducts. Florida had more than 13,000 injection wells as of 2011, according to the EPA.

Like it or not, the entire water system from Lake Okeechobee south is entirely human-managed today, Nance says, expressing confidence in injection wells as a waste management tool; Collier County is even using them to store excess water collected during the rainy season, he says.

There is a big difference, however—the aforementioned exemption that the oil and gas industry enjoys.

The state Underground Injection Code regulating for non-energy waste, such as municipal wastewater, runs 33,400 words long; the Class II well regulations for oil and gas waste are not quite 900.

In other parts of the country, scientists believe the pressure of injecting oil and gas waste provokes earthquakes. That doesn’t appear to be a risk here because wells are installed in the Boulder Zone, whose structure allows materials to shift, dissipating pressure.

The Boulder Zone is well-separated from the aquifers, and reports of leakage are few. That doesn’t mean it hasn’t happened. ProPublica reported in 2012 that 20 South Florida wells failed in the early 1990s, releasing partially treated sewage into aquifers that Miami may someday have to use for drinking water. If more drilling means more potential waste, the regulatory conversation should include further review of injection wells.

Florida has a number of options. It could provide further safeguards for residents in rural areas; the Durans initially proposed keeping wells a mile away from the nearest existing homes. It could go the way of New York State and ban fracking all together.

But we should acknowledge: A permanent ban does not take into account the rights of mineral owners, the industry’s six-decade track record or its contribution to domestic energy production, even if Florida is no North Dakota.

The answer lies somewhere in between in carefully balanced regulation based on hard data—or moratoriums on procedures whose implications are not fully understood in the context of Florida’s distinct geology and ecosystems.

In addition to Rodrigues’ disclosure legislation and Bullard’s fracturing prohibition, the DEP, the Conservancy and Collier County’s consultant, AECOM, have proposed numerous changes, including: increased fines; independent monitoring protocols; closer oversight of well construction and surface management; and change of the permitting process so drillers must expressly receive permission before embarking on well stimulation procedures.

The debate got off to a bad start—the Dan A. Hughes situation was a public relations blunder that all sides agree must never happen again.

“We did not have the outreach we should have,” Jones acknowledges. “That was, honestly, the biggest mistake, and I’ll take responsibility for it.”