June 22, 2024

Exxon, Chevron Invest Big in Permian Basin Shale

Author: Jonny Lupsha, Freelance News Writer
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By Jonny Lupsha, Freelance News Writer

Exxon Mobil Corp and Chevron Corp made dueling announcements about increasing their oil production in the United States, Reuters reported. Both energy companies have recently invested in shale production in the Permian Basin. The composition of the Permian shale’s geology and the environmental risks involved in fracking factor into their plans of successfully increasing production.

American Shale Gas - Drilling Rig sunset

During its presentation, Chevron stated that it planned to produce 900,000 barrels per day (bpd) of oil from the Permian Basin by the year 2023. Not to be outdone, representatives from Exxon Mobil alleged that they would produce a million bpd from their own Permian interests by 2024. According to the Reuters article, this would bring one-third of the Permian Basin’s total oil production under the control of the two oil giants. However, both companies’ projections raise concerns about the difficulties of shale production and the often-reported risks of fracking. Let’s look at both.

Pros and Cons of Shale Oil

First, what exactly are oil shales? “Oil shales refer to any number of organic-rich, fine-grained sedimentary rocks that contain the organic material kerogen,” said Dr. Michael E. Wysession, Associate Professor of Earth and Planetary Sciences at Washington University at St. Louis. “Kerogen is waxy material that contains complex organic compounds.” When heated to a certain temperature for a certain duration, kerogen produces shale oil—an alternative to crude oil.

Shale oil is also widely available. “There are a lot of oil shale deposits around the world that are technically recoverable—many trillions of barrels of shale oil,” Dr. Wysession said. The Green River Basin, which covers portions of Wyoming, Utah, and Colorado, is the largest known reserve of oil shale. It’s said to contain sediment deposited over 50 million years ago. According to Dr. Wysession, the Green River Basin alone could produce over 3 trillion barrels of shale oil.

However, producing shale oil requires digging up a considerable amount of land to mine the oil shales. This is far less convenient and much more environmentally concerning than regular oil drilling. In addition, mining oil shales and heating them to produce shale oil is a costly and time-consuming process. In order to be substantially profitable, the price of oil barrels would have to greatly increase.

Fracking—A History of Risks and Rewards

Hydraulic fracturing, more commonly known as fracking, was invented in the 1970s as a way to increase levels of gas extraction from sandstone reservoirs. “This was done by forcing fluids into the ground at high enough pressures that they cracked open the rock, and this allowed multiple pathways for the gas to come out of the well,” Dr. Wysession said. However, fracking didn’t become popular until the mid-2000s, when advancements in horizontal drilling made it more feasible.

The fracking fluids that are blasted against various rocks, including oil shales, are composed mainly of water and other harmless substances. But there’s the rub. A small percentage of fracking fluids, 0.5%, consist of a highly toxic chemical cocktail that aids the fracking process. “An exemption had to be obtained from the Safe Drinking Water and Clean Water Acts because fracking fluids are clearly very toxic and there are laws in the United States against dumping toxic fluids into the ground,” Dr. Wysession said.

Ideally, the toxic compounds are pumped deep into the ground far beneath where the fracking occurs, and safely away from the supply of drinking water. Noteworthy, however, this process of deposits causes earthquakes that have environmentalists concerned. Also of concern, faulty equipment used in fracking could cause the fracking fluid’s toxic chemicals to leak into the water supply.

If Exxon Mobil and Chevron pursue their plans of increased oil production in the Permian Basin over the next four to five years, their plans should factor in the effects upon the local area. Digging up large areas of land can disrupt local ecosystems and can be a drastic detriment to the aesthetics of the area in general. Fracking also carries its own set of environmental and health risks that must be taken into account.

Dr. Michael E. Wysession contributed to this article. Dr. Wysession is Associate Professor of Earth and Planetary Sciences at Washington University in St. Louis. Professor Wysession earned his Sc.B. in Geophysics from Brown University and his Ph.D. from Northwestern University. 

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