Drilling into shale rock to extract gas and crude has come under fire from federal regulators, state lawmakers and environmental groups concerned that the practice may contaminate drinking water. Shale rock was considered too hard to drill until the 1990s, when new methods for boring horizontal wells were combined with hydraulic fracturing, which involves pumping millions of gallons of high-pressure water laced with chemicals and sand underground.
The number of rigs drilling horizontal wells in the U.S. surged 23 percent in 2011, reaching 1,184 on Dec. 16, the highest since at least January 1991, according to Baker Hughes Inc., an oilfield-services provider that tracks rig activity.
Encana Wells
Last month, the EPA said for the first time that it found chemicals used in hydraulic fracturing in drinking water in Wyoming. Encana Corp., which operates 150 wells in the region of Wyoming where the EPA made its findings, said on Dec. 20 that the EPA failed to take into account naturally occurring chemicals and the possibility that the agency contaminated its own tests.
Total pursued shale opportunities outside France because of a ban on hydraulic fracturing in the company's home country. Scott Hanold, a Minneapolis-based analyst for RBC Capital Markets, said the Dec. 31 quake in Ohio--the tenth in that region in a year--is unlikely to spur restrictions that may disrupt U.S. shale exploration.
"No one has made a concrete connection between earthquakes and drilling," Hanold said. "There's not a lot of fear of regulation right now."