Chatham growers fear agricultural costs of fracking

Mar. 11, 2013 @ 12:37 PM

(Editor’s note: This is the second installment of a two-part series exploring the issue of hydraulic fracturing from the perspective of Chatham County farmers. The series was written by Katherine Blunt, a student at Elon University.)

PITTSBORO — As the North Carolina legislature weighs the pros and cons of lifting a moratorium on hydraulic fracturing, or fracking, some Chatham County farmers worry the practice will cause water shortages and contamination.

Both would result in heavy agricultural losses.

On Feb. 13, a state senate finance committee passed a bill to lift the fracking moratorium and allow natural gas companies to apply for drilling permits on March 1, 2015, five months after the North Carolina Mining and Energy Commission (MEC) is expected to propose regulations for drilling in the state. The bill must pass through several other senate committees before reaching the House, but its preliminary passage stirred the statewide fracking debate.

Fracking is a controversial method of natural gas extraction from subterranean shale formations. During the fracking process, the shale formation is drilled horizontally and then injected with pressurized fluid to release the gas within the rock. Proponents of the practice point to the economic benefits of domestic energy production, while opponents caution against the environmental risks of drilling near groundwater aquifers and using large amounts of water in the process.

Some fracking opponents argue the state does not have enough water to sustain the natural gas industry without compromising the water supply of citizens and farmers surrounding the Triassic Basin. North Carolina experienced two serious drought periods over the last two decades — one lasting from 1998-2002, the other from 2007-2008 — and some fear the 3-5 million gallons of water required to hydraulically fracture one well will further stress existing water resources.

“There is a lot of concern about having enough water for all of our needs,” said Doug Jones, owner and operator of Piedmont Biofarm in Pittsboro. “In a dry year, people with wells in some places are getting dry, and the water supply is becoming inadequate for irrigation. As our climate changes and our weather gets hotter, we're going to need more and more irrigation of water to grow good crops, and if there is the destruction of water supplies, that can't happen.”

Though Sam Groce, the agricultural extension director of Chatham County, said he is neither for nor against the idea of fracking in the state, the possibility of water shortages concerns him as well.

“We do know that we can be water limited here,” he said. “We only have a certain amount to work with.”

But some believe careful oversight will prevent water shortages. The North Carolina Division of Water Resources regulates water usage permits and monitors aquifer and reservoir levels, and MEC Chairman Jim Womack said much of the water used during the fracking process can be reused by drillers.

“If a drought gets bad, then the people who involved in the fracking industry would be denied a permit,” Womack said. “There will be plenty of water to support the limited degree of drilling in this part of the state."

Not all Chatham County farmers are alarmed at the possibility of fracking in the area. According to Groce, some recognize it as an economic opportunity.

Norma Burns, an organic farmer in Bennett, said she understands why some farmers have adopted this viewpoint, although she adamantly disagrees with it.

“There are some farmers who are are desperate, small family farms especially.” she said. “ It's not an easy life.”

Farrell Moose, who owns Dutch Buffalo Farm in Pittsboro, said he thinks only a few people will share in the economic benefits of fracking, while many others will be forced to bear its potentially negative effects.

“My main concern is the loss of agricultural service,” he said. “They project they're going to be in and out in nine years, but the damage could last forever. The people who think the government is all hard numbers are wrong. It is very difficult to put a monetary figure on the loss of agricultural use of the land for an indefinite period of time. It's the government's responsibility to foster business, but more importantly, to protect our common resources for economies and generations to come.”

Organic certification questions remain unanswered

Of the Chatham County farmers concerned about water contamination, some with organically certified farms are doubly worried. Obtaining organic certification is an expensive process, and the loss of certification could mean the loss of income for certified farmers.

“I sell 20 percent more by being organic,” said Judy Lessler, who owns Harland’s Creek Farm in western Pittsboro. “If my water was contaminated, it definitely would affect my organic certification.”

Burns harbors similar concerns.

“I have to be so careful about anything that gets put on my plants,” she said. “Should we have fracking, and should there be a national concern or a statewide concern, I’m sure that would be added to the organic certification process.”

Though a loss of certification would affect Burns’s profits as well, it would also impact her on a personal level. 

“Organic certification is part of my farm identity,” she said. “It costs me $500 to get certified each year. If I lost it, I'm sure I'd see a decline in sales, but in terms of absolute losses, I have no data. I am certified because it's something that I believe in, and that's my reason primarily.”

Problems with water quality could mean a loss of more than just her certification. It might cost her the health of her fields.

“If the water quality was disrupted to cause issues with certification, the produce would likely have been compromised,” she said. “Then certification would be a moot point.”

In Pennsylvania, where fracking is a well-established industry, some certification agencies have amended their certification guidelines to account for the possible risk of water or soil contamination sometimes associated with natural gas extraction.

Pennsylvania Certified Organic requires its farmers to stay abreast of extraction activity in their areas and revise their organic system plans accordingly. But risks associated with any industrial development are often unpredictable, and PCO “reserves the right to issue non-compliances associated with gas drilling after approving the Organic System Plan,” according to its guidance document on natural gas exploration and drilling.

Although many organic farmers in Pennsylvania are worried about losing their certifications, Kyla Smith, certification director at PCO, said none of the farms certified by PCO have lost their certifications since fracking activity began in the state.

“Many farmers do not like fracking on principle, and I think they may wish that there was a more definitive line that would preclude an organic farmer from organic certification,” she said. “However, it is not so black and white.  It really does depend on the particular circumstances farm to farm.”

Bryan Snyder, executive director of the Pennsylvania Association for Sustainable Agriculture, expressed a similar sentiment.

“Everyone seems to be asking this same question regarding the effects of fracking on organic farming,” he said. ”As far as I know, there are no official answers out there.”

Study committee considers forced pooling laws

Senate Bill 820 authorized the appointment of three study groups within the MEC, and two of the groups will examine several factors that might affect the impact of fracking activity on Chatham County farmers, both conventional and organic.

One study group will compare the state's current forced pooling policies with those of other states now fracking for natural gas and modify the policies if needed. North Carolina’s forced pooling law, which was originally written to regulate vertical drilling for natural gas, now affords DENR the right to require landowners to integrate their properties into a single tract.

If a significant percentage of landowners within a proposed drilling unit agree to lease their gas rights to an oil and gas company, forced pooling laws require holdout landowners to integrate their property into the unit. Fracking extracts gas from a wide area surrounding the well, and drilling units negate the complex legal question of what gas came from where. All landowners within established drilling units share in royalties paid by the oil and gas company.

Proponents of forced pooling insist such laws benefit both the land and the landowner by minimizing the number of wells within a unit and ensuring all landowners are properly compensated for the gas extracted from underneath their properties. Opponents believe forced pooling laws encroach on landowners’ property rights.

A proposed amendment to North Carolina’s constitution may affect the policies drafted by the study committee. The amendment stipulates the government may only condemn private land for public use, such as the construction of a road. It is unclear whether the proposed amendment would afford holdout landowners the right to refuse to pool their land.

“Drilling wells is not public use,” said John Humphrey, principal of the Humphrey Law Firm in Washington, D.C., and former director of policy development at DENR. “It's different than it is for a road or a power line because most of the profits are going to a small group of folks who are immediately close to the site. There is much debate about what it means, but it seems the amendment would allow you to condemn property to build a road to the well pad, but it won’t allow you to claim the land to build a well.”

The study group will report its recommendations to the Joint Legislative Commission on Energy Policy and the Environmental Review Commission by Oct. 1, 2013.

“That group will absolutely look at every state in the nation that is actively mining for natural gas or oil,” said Ray Covington, a Lee County property owner, Mining and Energy commissioner and owner of North Carolina Oil and Gas, a company that educates landowners about their mineral rights. “We'll look at those states and their policies and assess the pros and cons and try to come up with how those policies differ from our current forced pooling law. If you look at our current forced pooling law, it's very broad.”

Although Moose is opposed to forced pooling, he said the recommendations of the study group will have little effect on his overall peace of mind in regard to the possibility of fracking in his area.

“If my three neighbors sold their rights and rigs were getting set up on either side of me, I'd already be in hot water, wouldn't I?” he asked.

Study committee examines power of local governments

A second study group will determine the extent to which local governments will be able to regulate oil and gas activities through zoning or other local ordinances. The group will present its recommendations to the Joint Legislative Commission on Energy Policy and the Environmental Review Commission by Oct. 1, 2013.

“These limits on zoning and local regulatory power would be one of the factors controlling whether local governments could establish special agricultural districts that might regulate certain types of oil and gas activities,” Humphrey said.

Covington noted the establishment of such districts would likely give rise to a new set of questions.

“The organic farmer thinks differently than the corn, soybean or tobacco farmer, incredibly different mindsets," he said. "It's easy to say you're going to carve out all these agricultural districts, but the reality is every district has its own unique set of issues.”

Covington acknowledged the interest of maintaining a viable farming community in Chatham County.

“How is that all affected?” he asked. “That is something we need to think about.”

From the perspective of a Chatham County produce farmer, Moose said he thinks allowing local governments to establish special agricultural districts is a good idea.

“Special agricultural districts might let people decide whether they want their land to be agricultural or industrial or post-industrial,” he said. “They would at least put the question on the table and give farmers a voice in the debate.”