Fracking in Ohio
Energy • Environment • Fracking • Public education • School choice • Higher education • Public pensions • State budget • Taxes • Voting • Ballot access • Redistricting
|Fracking in Ohio|
|Regulatory agency||Ohio Department of Natural Resources; Division of Oil and Gas Resources|
|Fossil fuels present||Oil, natural gas and coal|
|Year fracking began||1950s|
|Other state fracking pages|
|Alabama • Alaska • Arizona • Arkansas • California • Colorado • Connecticut • Delaware • Florida • Georgia • Hawaii • Idaho • Illinois • Indiana • Iowa • Kansas • Kentucky • Louisiana • Maine • Maryland • Massachusetts • Michigan • Minnesota • Mississippi • Missouri • Montana • Nebraska • Nevada • New Hampshire • New Jersey • New Mexico • New York • North Carolina • North Dakota • Ohio • Oklahoma • Oregon • Pennsylvania • Rhode Island • South Carolina • South Dakota • Tennessee • Texas • Utah • Vermont • Virginia • Washington • West Virginia • Wisconsin • Wyoming|
- 1 Fracking background
- 2 History
- 3 Fracking at the ballot box
- 4 Economic impact
- 5 Environmental impact
- 6 Socioeconomic impact
- 7 Departments, agencies and organizations
- 8 Major organizations
- 9 Natural gas use in Ohio
- 10 News items
- 11 See also
- 12 External links
- 13 References
- See also: Fracking
Hydraulic fracturing, or "fracking," is the process of injecting fluid--mostly water and sand, but with additional chemicals--into the ground at a high pressure to fracture shale rocks and release the oil and natural gas inside.
Recent technological advances in oil and gas drilling--horizontal drilling and hydraulic fracturing--have created a wealth of opportunities and challenges for states with fossil fuel reserves that can be accessed through the combination of these two technologies. The increased use of fracking has been an economic boon for many states, not only those with fracking, but also those with supporting industries, such as frac sand mining or associated machinery manufacturing.
Opponents of fracking argue that the potential negative environmental and human health impacts could be significant. Although wells have been fracked for over 65 years in the United States, concerns have been raised about whether federal, state and local regulatory agencies can keep up with the recent rapid increase in fracking activity, and adequately protect the environment and human health. As with any type of energy extraction, either traditional or renewable, there are economic, environmental and political tradeoffs.
Oil was first discovered in Ohio in 1814 in Noble County by two men drilling for salt. This event marked the first instance in the United States of discovery of crude oil from a drilled well. The first commercial oil well in Ohio went into production in 1860 in Washington County. Commercial production of natural gas began in 1885.
Fracking at the ballot box
|Voting on Fracking|
|Not on ballot
- City of Athens Fracking Ban Initiative, Issue 7 (November 2014)
- City of Kent "Community Bill of Rights" Fracking Ban Initiative, Issue 21 (November 2014)
- City of Niles "Community Bill of Rights" Fracking Ban Initiative (November 2014)
- Village of Gates Mills "Community Bill of Rights" Fracking Ban, Issue 51 (November 2014)
- Youngstown "Community Bill of Rights" Frack Ban, Issue 4 (November 2014)
- Youngstown "Community Bill of Rights" Fracking Ban Charter Amendment (May 2014)
The use of fracking, often in combination with horizontal drilling, has made it possible to extract supplies of oil and natural gas that were once economically unfeasible to extract. This has led to significant growth in the domestic oil and gas industry, and in the supply of domestically produced oil and natural gas. The growth in activity has impacted the economy in direct ways, such as increased capital investments (from both the U.S. and other countries), royalty and lease payments, and government revenues in the form of fees and taxes. The increased supply of natural gas and oil has also affected electricity prices, manufacturing, service industries and employment. In many places, fracking has increased employment in the mining (oil and gas) sector and supporting industries, such as the restaurant and housing sectors. Consumers and manufacturers have also benefitted thus far from lower oil and natural gas prices, and increased demand for pipeline, drilling and other ancillary equipment. As demand for natural gas and oil grows, however, prices are expected to rise.
Taxes, fees and revenue
Fracking booms can increase local government revenue through increases in property and sales taxes, which can help compensate for the costs detailed below. The primary revenue streams from fracking--mineral leasing revenues and severance taxes--go to state and federal governments. As of June 2013, Ohio employed the following severance tax:
- "$0.025 per MCF of natural gas
- $0.10 per barrel of oil."
Of the revenue collected from this tax, 10 percent goes to the Geological Mapping Fund. The remaining 90 percent goes to the Gas Well Fund.
Royalties and land sales
The United States is one of the few countries where property owners can own the right to use and build on their land, known as surface rights, but they may not own the rights to the minerals located under their property. Depending on the state the mineral rights may have been sold in the past and may now belong to someone other than the surface owner. In fact, those mineral rights may belong to more than one individual, a company, or many individuals, who now have the right to extract those minerals, and in some states this can happen without the permission of the property owner. This can cause tension between the mineral owner, or whoever is leasing the mineral rights, and property owner.
The federal government doesn't collect data on oil and natural gas royalty and land sales on private land. A 2014 study attempted to estimate these figures and determined that Ohio (among the lower 48 states) was 15th in private royalty income in the nation. The study also found that for 2010:
- Private oil revenue was $277 million
- Private natural gas revenue was $307 million
- Estimated royalty income was $73 million
- Royalty income was 1.77 percent of state average income.
Economic impact studies
Below is a study about the economic impact of the oil and natural gas industry (also categorized as the mining industry in some studies) in Ohio. Both the author(s) and sponsor(s) of the study have been listed.
Study for the American Petroleum Institute
|IMPLAN and REMI are two econometric modeling systems used in both the private and public sectors to predict economic outcomes of policy changes. While these systems are widely used and highly respected, their results are theoretical and may not be universally accepted.
Because the oil and gas industry has grown so rapidly, there is not a wealth of data regarding its economic impacts. Instead, economists use forecasting models, such as IMPLAN and REMI, to predict the impact increased fossil fuel extraction is having on the economy. These studies usually measure both direct impacts, i.e., the jobs and income being added within the oil and gas industry and indirect impacts, i.e., jobs created throughout the supply chain. These studies also include induced impact, i.e., jobs created through increased spending due to growth in the industry.
The following data are taken from a study done by PricewaterhouseCoopers LLP (PwC), a research consulting firm, for the American Petroleum Institute about the economic impact of the oil and natural gas industry in 2011 in Ohio. According to the PwC study, the oil and gas industry added $28.44 billion in total value in 2011, including direct, indirect and induced value. Of this $13.86 billion, or 2.8 percent, of the state's total value added was direct, $7.05 billion was indirect and $7.54 billion was induced, totaling 5.7 percent of the state's total value in 2011.
The PwC study attributes 255,098 jobs, or 3.9 percent of employment in Ohio in 2011, to jobs created directly by, indirectly by, or induced from, the oil and natural gas industry. The industry directly employed 77,025 people, or 1.2 percent of state total employment. Indirectly the industry employed 75,070 people and induced 103,004 jobs.
Direct, indirect and induced labor income, according to this study, was $12.74 billion, totaling 4.1 percent of Ohio's labor income in 2011. Direct labor income from the mining sector was $3.88 billion, or 1.2 percent of the state's total. Indirect labor income totaled $4.47 billion and induced labor income was $4.4 billion.
Because of the sudden and unprecedented growth in fracking across the United States, getting high-quality, unbiased, state-specific information on the environmental impacts of fracking can be difficult. Most studies that would fit those first two qualifications are government studies that focus on the nation as a whole. As such, much of the information that follows in this section may only apply generally to the state. State-specific information has been added where possible.
As with any type of energy extraction, there are several areas of risk when it comes to air quality. In the case of fracking, these risks include air pollutants such as volatile organic compounds (VOCs) and methane. Some environmental groups have raised concerns that methane could be leaked during the extraction process, resulting in unnecessary pollution. Most of this pollution occurs during the well completion phase. Fracking operations can also emit known carcinogens, which have been linked with increased rates of cancer.
With regard to carbon dioxide, when natural gas is used to generate electricity in power plants, it produces fewer carbon emissions than coal-fired power plants. According to a 2014 study by the National Oceanic and Atmospheric Administration, "as a result of the increased use of natural gas, CO2 emissions from U.S. fossil-fuel power plants were 23% lower in 2012 than they would have been” without the increase in natural gas use. During the extraction process, however, methane is emitted, and methane actually traps 20 times more carbon dioxide than other greenhouse gases. Nevertheless, according to the International Energy Agency (IEA), CO2 emissions in the United States dropped by 3.8 percent in 2012, due in large part to the "increased availability of natural gas, linked to the shale gas revolution."
A 2014 report from the U.S. Environmental Protection Agency found a decrease of 3.3 percent in overall greenhouse gas emissions and a 12 percent decrease in methane emissions from 2011 to 2012. Natural gas extraction is the second largest producer of methane, after cattle.
The central and eastern United States have been experiencing an increased number of earthquakes over the last few years, according to the U.S. Geological Survey (USGS), the government agency responsible for such data. Studies from the USGS have not found fracking directly responsible for this increase in felt earthquakes; however, the USGS is looking into regulations that would use seismic data to determine thresholds dictating when and where fracking can occur. There is a growing body of evidence suggesting that this growth in the number of earthquakes has been caused by the increased use of injection wells to dispose of fracking wastewater. While fracking has been rarely known to cause earthquakes, there is an established scientific link between earthquakes and the disposal of fluids in deep, underground injection wells. Once a well has been fracked, the water returned to the surface is called wastewater, and contains large amounts of salt and other contaminants. Some of this water can be recycled, but that water which can't be recycled is often stored in injection wells. These injection wells are generally considered the safest and most cost-effective place for wastewater to be stored. Injection wells are located thousands of feet underground and are encased in cement. Multiple drilling wells often rely on one disposal well for wastewater storage. The U.S. Environmental Protection Agency estimates there are 144,000 of these wells across the United States receiving 2 billion gallons of frack fluid per day.
Induced seismology, or man-made earthquakes, have been around for decades and can be caused by mining, damming rivers and injecting fluids into underground wells. Earthquakes are caused by injection wells when water pumped into underground wells causes the faults under the earth to slip. Even though scientists at the USGS have been able to cause earthquakes intentionally by carefully injecting liquid into the earth, the link between injection wells and earthquakes is not fully understood. One of the largest concerns for scientists and regulators is that they do not have the tools to predict whether wastewater will cause seismic activity. These concerns are compounded by the lack of knowledge about where faults are located across the central and eastern United States. The USGS is just beginning to map these areas in more detail in order to understand the seismic risks. As of June 2014, these earthquakes have typically been small, two or three in magnitude on the Richter scale, but at least one scientist has raised concerns that earthquakes could grow in intensity if old injection wells continue to be used for storage.
Earthquakes in Ohio and fracking
A series of five earthquakes, ranging from 2.1 to 3.0 in magnitude, were recorded in March 2014 in Poland Township, Ohio. Due to the proximity of the 3.0 earthquake to a well that was being fracked the Ohio Department of Natural Resources shut down operations at that well. A January 2015 report from the Seismology Society of America linked these March 2014 earthquakes "to hydraulic fracturing that activated a previously unknown fault."
When it comes to water protection and fracking there are four main areas of risk: the depletion of fresh water sources, spills and leaks of fracking fluid into water, mismanaged produced water and flowback, and stormwater pollution. Stormwater, flowback, produced water and wastewater can be harmful because they contain total dissolved solids and naturally occurring radioactive materials. Because of the recent rapid growth in fracking, there are still many uncertainties about the effects of fracking on water. There are studies that link fracking to groundwater contamination, but they remain controversial. The U.S. Environmental Protection Agency is releasing a report in spring 2015 on the potential impacts of fracking on drinking water, and is working on effective programs for managing these potential risks.
One of the main criticisms of fracking is that the process uses a disproportionately large amount of water. Up to 10 million gallons of fresh water may be required to frack one well. A 2014 study from the Bureau of Economic Geology at the University of Texas found, however, that the amount of water used in a traditional well, versus a hydraulically fractured well, is not appreciably different. According to one of the researchers, Dr. Bridget Scanlon, "The water used to produce oil using hydraulic fracturing is similar to the water used in the U.S. to produce oil using conventional techniques." The only difference between the amount of water used during the two oil or gas production techniques, is when in the process water is used. The study was funded by the Alfred P. Sloan Foundation.
Because of the recent, rapid growth of fracking, little is known about the potential impacts to human health. Government agencies dealing with human health issues have raised concerns about some chemicals that can be released during the fracking process, including VOCs. The Centers for Disease Control are working with the EPA and federal, state and local agencies to better understand potential impacts.
Fracking can also present challenges to communities. Increased oil and natural gas production happens in boom or bust cycles, and often these cycles disproportionately occur in rural communities. Large scale fracking booms can also lead to increases in crime, such as substance abuse, sex trade and domestic abuse. An influx of oil and gas workers also strains housing and traffic resources. This lack of housing can push oil and gas workers into so-called 'man camps,' which are "clusters of mobile homes, RVs, and trucks," or into hotels. A fracking boom also puts heavy traffic on roads, which can strain infrastructure, increase traffic accidents, and increase the likelihood of oil spills. Local governments respond by hiring more police, social workers, health care workers and emergency response personnel, thereby spending more of their budgets on roads and social programs. Currently, much of the tax revenue generated by the oil and gas industry goes to the federal and state government, not the local governments.
Departments, agencies and organizations
- The Division of Oil and Gas Resources is an agency within the Ohio Department of Natural Resources. Established in 1965, the division is "responsible for regulating Ohio's oil and natural gas industry and for the protection of all Ohioans and our environment while ensuring the state's abundant natural resources are managed properly." Generally, the division regulates all oil and gas drilling and production operations in the state. The division also conducts inspections of the drilling, restoration and plugging of all oil and gas wells.
- The stated goal of the Ohio Environmental Protection Agency is "to protect the environment and public health be ensuring compliance with environmental laws." Created in 1972, the agency establishes and implements regulations pertaining to air and water quality and waste management. Regulation divisions include:
- Air Pollution Control
- Environmental and Financial Assistance
- Drinking and Ground Water
- Environmental Response and Revitalization
- Environmental Services
- Materials and Waste Management
- Surface Water
- The Ohio Oil and Gas Association (OOGA) is a non-profit organization and trade group that represents the oil and natural gas industry in the state. OOGA has more than 3,300 members. OOGA is listed as a "cooperating association" by the Independent Petroleum Association of America, which is a national trade group that "advocates its members' views before the U.S. Congress, the Administration and federal agencies."
- The Ohio Environmental Council is an environmental advocacy group. The group's stated mission is to "secure healthy air, land, and water for all who call Ohio home." The group was founded in 1969. Regarding fracking, the organization has called for tighter regulations, including "an increased number of inspectors, strengthened penalties, an impact fee on drillers to cover externalities or damage associated with drilling, and by passing a citizen rights amendment which would allow for citizens to have the right to know about, comment on, and appeal shale gas permits."
Natural gas use in Ohio
- For more information on energy consumption in Ohio, see "Energy policy in Ohio"
In 2011, the industrial sector consumed roughly one-third of Ohio's energy, while about one-quarter was used by both the residential and transportation sectors. Most of the energy used in the state is in the form of coal (primarily for electricity generation), followed by natural gas.
Two of three homes in Ohio use natural gas in order to heat their homes, and about one in five are heated with electricity. For natural gas, this proportion is well above the 50 percent national average. The lower price of natural gas in Ohio probably explains why so many homes employ it as their primary heat source.
|Consumption of energy for heating homes in Ohio|
|Source||Ohio 2011||U.S. average 2011|
|Liquid Petroleum Gases (LPG)||5.3%||5%|
Ohio produced 1,066.2 trillion BTU of energy in 2011. Of that, about 63.7 percent came from coal, and just over 14 percent from nuclear power. The third largest source of energy was natural gas, with about 7 percent. Biofuels and 'other' renewable energies made up about 11 percent of the state's total energy production.
Natural gas provides about 18 percent of total electricity generation in Ohio. There are 449 natural gas utilities in Ohio that the Public Utilities Commission of Ohio (PUCO) regulates. There are some small utilities that PUCO doesn't regulate, but these are usually owned and managed by the local government of the area they operate in. There are seven companies that manage the natural gas pipelines in Ohio. These include BP Oil, and Ohio Intrastate Energy LLC.
|Where electricity comes from in Ohio|
|Type||Amount generated (MWh)||% of state**||% of U.S.**|
|Total net electricity generation||10,618||100%||0%|
|**Note: Because the U.S. Energy Information Administration (EIA) does not include all of a state's energy production in these figures, the EIA totals do not equal 100 percent. Instead, we have generated our own percentages.|
This section displays the most recent stories in a Google news search for the term "Ohio + Fracking"
- All stories may not be relevant to this page due to the nature of the search engine.
- U.S. Energy Information Administration, "Ohio Profile"
- Frac Focus, "National Hydraulic Fracturing Chemical Registry"
- The Ohio State University Extension Shale Education Program, "Leasing Your Mineral Rights," accessed July 23, 2014
- U.S. Energy Information Administration, "Ohio Profile Analysis," updated December 18, 2013
- Energy Tomorrow, "Energy Tomorrow Blog: Video: Fracking Has Rich History, Future in Ohio," May 23, 2014
- Ohio Division of Oil and Gas Resources, "The Facts About Hydraulic Fracturing," accessed July 23, 2014
- Ohio Oil and Gas Energy Education Program, "History," accessed July 23, 2014
- IHS, "US unconventional oil and gas revolution to increase disposable income by more than $2,700 per household and boost US trade position by more than $164 billion in 2020," accessed September 17, 2014
- National Conference of State Legislatures, "State Revenues and the Natural Gas Boom: An Assessment of State Oil and Gas Production Taxes," June 2013
- Geology.com, “Mineral Rights,” accessed January 29, 2014
- All the data presented below are in millions of nominal dollars. The royalty income figures assume a 1/8th royalty rate.
- Social Science Research Network, "U.S. Private Oil and Natural Gas Royalties: Estimates and Policy Considerations," March 12, 2014
- IMPLAN, "IMPLAN's History of Expert Economic Data," accessed September 17, 2014
- REMI, "About Us," accessed September 17, 2014
- REMI, "Clients," accessed September 17, 2014
- PricewaterhouseCooper LLP, "Economic Impacts of the Oil and Natural Gas Industry on the US Economy 2011," July 2013
- University of Oklahoma, "Hydraulic Fracturing and Water Resources," accessed March 15, 2014
- Senate Committee on Energy and Natural Resources, "Written Testimony of Frances Beinecke," accessed March 2, 2014
- Stanford Law School Student Journals, "Local Government Fracking Regulations: A Colorado Case Study," January 2014
- Cooperative Institute for Research Environmental Sciences,, "New study: U.S. power plant emissions down," January 9, 2014
- International Energy Agency, "Redrawing the Energy-Climate Map," June 10, 2013
- The Wall Street Journal, "Talk About Natural Gas: Cow Belches Top Methane List," February 26, 2014
- U.S. Geological Survey, "Man-Made Earthquakes Update," January 17, 2014, accessed March 10, 2014
- National Geographic, "Scientists Warn of Quake Risk From Fracking Operations," May 2, 2014
- National Public Radio, "How Oil and Gas Disposal Wells Can Cause Earthquakes," accessed June 2, 2014
- Seismology Society of America, "Fracking Confirmed as Cause of Rare “Felt” Earthquake in Ohio," January 5, 2015
- U.S. Environmental Protection Agency, "Natural Gas Extraction - Hydraulic Fracturing," accessed March 10, 2014
- WOAI, "Research: Fracking Uses No More Water Than Traditional Oil Production," October 6, 2014
- Bureau of Economic Geology, "US Shale Reserves and Production Bureau Shale Gas Study," October 6, 2014
- U.S. Department of Health and Human Services, "Garfield County," March 13, 2008, accessed March 10, 2014
- Centers for Disease Control, "Review of Federal Hydraulic Fracturing Research," April 26, 2013, accessed March 10, 2014
- Ohio Division of Oil and Gas Resources, "About Us," accessed July 23, 2014
- Ohio Environmental Protection Agency, "About Us," accessed July 23, 2014
- Ohio Environmental Protection Agency, "Table of Organization," accessed July 23, 2014
- Ohio Oil and Gas Association, "About Us," accessed July 23, 2014
- Independent Petroleum Association of America, "About IPAA," accessed July 16, 2014
- Independent Petroleum Association of America, "Cooperating Associations," accessed July 16, 2014
- Ohio Environmental Council, "Fracking," accessed July 23, 2014
- Ohio Environmental Council, "Who We Are," accessed July 23, 2014
- Ohio Environmental Council, "About Us," accessed July 23, 2014
- U.S. Energy Information Administration, “State Energy Data System, Production,” accessed February 18, 2014
- Public Utilities Commission of Ohio, "Regulated Company List," accessed March 5, 2014
- Public Utilities Commission of Ohio, "Regulated Company List," accessed March 5, 2014
- Ohio Legal Services, "Utilities: Unregulated Utilities," accessed March 5, 2014
- U.S. Energy Information Administration, "Ohio Profile Overview," accessed February 5, 2014
State of Ohio
|State executive officers||
Governor | Lieutenant Governor | Attorney General | Secretary of State | Treasurer | Auditor of State | Superintendent of Public Instruction | Director of Insurance | Director of Agriculture | Director of Natural Resources | Superintendent of Industrial Compliance and Labor | Chairman of Public Utilities |