California Farmers, Oil Men, Competing for Water

AP via Business Insider:

The figures prove it. In Fresno County, which leads the nation in agricultural production, officials issued 256 permits to dig new wells in the first three months of 2014, more than twice the number compared to the same time last year. That includes all types of water wells used for agriculture and homes.

In Tulare County, the number of permits issued to dig farm wells alone has tripled to 245. In Kern County, farmers took out 63 new well permits in the first quarter of the year, more than quadrupling last year’s number.

The price to dig a well depends on the depth and ground composition, drillers say, costing a farmer anywhere from $50,000 to $500,000 before installing the pumps.

Tapping groundwater has other costs. The water that was deposited underground naturally over thousands of years isn’t being replaced as rapidly as it’s being drawn, causing the ground in the Central Valley to sink in a process called subsidence. In California, there is little if any regulation of groundwater pumping by the state.

In most years, Central Valley farmers draw one-third of their water from wells, while the remaining two-thirds comes from California’s State Water Project and the federal Central Valley Project. Most farmers expect to receive no water from either this summer, and that ratio is dramatically shifting to underground water supplies, which could eventually run dry.

Meanwhile, fossil fuel companies are looking to use precious remaining water resources to tap exotic oil shales beneath some of the most critically endangered agricultural land in the country.

Future Structure:

The race began after the federal Energy Information Administration estimated in 2011 that more than 15 billion barrels of recoverable oil is trapped in what’s known as the Monterey Shale formation, which covers 1,750 square miles, roughly from Bakersfield to Fresno.

But getting at that oil isn’t easy. The Monterey Shale is unlike other oil shale formations across the United States. In those booming oil fields, reserves are pooled in orderly strata of rock. Once the rock is cracked open by fracking or other means, operators can sink a single well with multiple horizontal shafts and pull in oil from a wide area.

California’s geology is far more complicated. The earth under the Monterey Shale has undergone constant seismic reshaping that has folded, stacked and fractured the substrate, trapping the oil in accordion pleats of hard rock at depths of up to 12,000 feet. To reach the crude using conventional methods requires oil companies to drill far-deeper wells, and more of them — a prohibitively expensive undertaking.

To crack the code, companies are busily drilling test wells here, using various fracking and acidization techniques in search of cheaper solutions. So far, no one seems to have found a method to profitably extract the oil.

“Very smart engineers are spending their waking hours trying to come up with the magic formula,” said Rock Zierman, chief executive of the California Independent Petroleum Assn., a trade group that has many Monterey Shale prospectors among its members.

“What we do know is there is a heck of lot of oil down there,” Zierman said. “What we don’t know is how we can get it out of the ground in an economically viable way to justify the heavy investment.”

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Exploratory wells are sprouting near homes, schools and in the town of Shafter, where the city charges drillers to hook up to corner fire hydrants for the water they require. Companies are searching for the best well sites with 3D seismic “thumper trucks” that send shock waves underground to create a picture of subterranean deposits.

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The implications are profound, touching on public health, water use, water quality and the loss of agricultural land. The subsequent transformation also would alter the lives of families living in the resolutely rural communities dotting the valley.

For Tom Frantz, a retired teacher and third-generation farmer, the exploratory drilling is already too much.

“This is prime farmland and they have drilled between 200 and 300 wells in the last 10 years in the Monterey Shale,” Frantz said. “Every one took out an acre or two of farmland. Every one has used hundreds of thousands of gallons of water. Each one has contributed to our air pollution. Each one has had spills on the ground of different chemicals and crude oil. Each one is emitting methane as we speak.

“If this thing happens and there are thousands and thousands of wells — that’s scary because an accident is bound to happen,” he said.