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Is shale oil a sustainable business model? Show more Show less
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The drilling of shale oil has been hailed as revolution that has brought cheap gas and oil to American and made America a net exporter of oil and natural gas. However, there is serious debate as to whether shale is a sustainable business model given the high number of bankruptcies in the sector. What are the positions on the shale operating model?

Shale is a viable, sustainable business model given improvements in technology and prices Show more Show less

The ability for drillers to learn quickly and improve production has brougth down shale's true cost of extraction far below the market price of oil
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U.S. oil and natural gas production has skyrocketed

Hydraulic fracturing is perhaps the most important energy discovery in the last half-century. However, do the costs of such an advancement outway the benefits?
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The Argument

In the last decade, advances in fracking technology have reversed the United States' trajectory from that of energy scarcity to being, simply put, “the undisputed leader of oil and gas production worldwide,” according to International Energy Agency Executive Director Fatih Birol.[1] In looking at specific numbers, from 2007 to 2016, the United States's annual oil production increased 75 percent, while natural gas production increased 39 percent. Such an advancement in the status of the United States can be singlehandedly attributed to similar improvements in the fracking industry.[1] This increase has proved beneficial for consumers as it abruptly lowered energy prices, strengthened energy security, and even lowered air pollution and carbon dioxide emissions by displacing coal. In turn, these lower prices mean that American families and businesses have more money in their own pockets; an excess that will eventually be reinvested into the economy. Moreover, these lower coal emissions are certainly good news for public health and our climate.[2]

Counter arguments

Yes, fracking has done wonders for the American economy and its reliance on coal— but at what cost? The environment of numerous communities have been desecrated. Fracking has brought about increasing truck traffic, crime, as well as numerous health impacts (due to air and water pollution). For example, babies born within 3 kilometers of a fracking site are more likely to suffer from poor health, and as a result, premature death. The largest impact is seen in regards to babies born within 1 kilometer. It is here that these children are predisposed to having a lower birth rate than their counterparts (i.e., weighing less than a total of 5.5 pounds). Moreover, mothers living closer to wells would suddenly become poorer, use more alcohol, or eat less healthy.[2]

Premises

Rejecting the premises


References

  1. https://www.ipaa.org/fracking/
  2. https://www.forbes.com/sites/ucenergy/2018/02/20/fracking-has-its-costs-and-benefits-the-trick-is-balancing-them/#70940a0e19b4

This page was last edited on Saturday, 11 Jul 2020 at 05:02 UTC

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