Jan 03 2013

Prospects for natural gas in Idaho

Published by at 8:03 pm under Idaho,Mendiola

Mark Mendiola
Eastern Idaho

Hydraulic fracturing or “fracking,” coupled with technological advances in horizontal drilling, have revolutionized the natural gas industry’s ability to tap into North America’s vast shale reserves and dramatically boost available natural gas volumes.

Because of its relatively low cost and increased availability, natural gas has become the “energy of choice” for many companies using it to fire up their plants, heat their buildings, generate electricity and maintain business operations.

Natural gas executives lately are expressing an optimism they haven’t always enjoyed about their industry’s future. Before, limited natural gas reserves appeared for decades to be locked up and inaccessible due to an inability to reach them underground.

Fracking and horizontal drilling have made an almost infinite supply of natural gas and petroleum a reality, they say, greatly helping America’s energy independence.

But the controversial hydro fracturing technology is opposed by many environmental groups who fear it contaminates ground water, reduces air quality and causes gases and chemicals to migrate to land surfaces.

Injection of highly pressurized fluids into subterranean shale formations creates new veins or fractures, which improve extraction rates and recovery of hydrocarbons. The fluid injected into the rock typically is a slurry of water, sand, gels , foams, chemical additives and gases, including nitrogen, carbon dioxide and oxygen.

Industry officials say fracturing liquids consist 90 percent of water, 9.5 percent of sand and .5 percent of chemicals. A typical fracking treatment uses between three and 12 chemical additives, including acids, salt, friction reducers, ethylene glycol, methanol, isopropyl alcohol, carbonates and disinfectants.

Petroleum engineers, not public relations professionals, coined the term “fracking,” notes Dan Kirschner, executive director of the Portland-based Northwest Gas Association – a trade organization that includes six natural gas utilities serving Idaho, Oregon, Washington and British Columbia, and four transmission pipelines that transport natural gas throughout the region from supply basins.

There were large declines in industrial natural gas use in 1999 and 2000 in connection with California’s energy crisis, which left only two of 10 aluminum plants standing in the Pacific Northwest, Kirschner says. The “Great Recession” that started at the end of 2008 also caused permanent shutdowns of other plants across the region.

Meanwhile, “gas came into the market right into the teeth of the Great Recession. There was a decline in demand just as there was a great increase in production.” From 2007 to 2010, there was a dramatic spike in production, driving down costs.

natural gas
Scott Madison, Intermountain Gas executive vice president and general manager, right, discusses natural gas issues with Kirk Bailey following a City Club of Idaho Falls presentation. (photo/Mark Mendiola)

Although the National Oceanic & Atmospheric Association (NOAA) predicted a more active hurricane season that could impact drilling in the Gulf of Mexico during 2012, “the gas market didn’t budge. It didn’t even blink.”

In 2010, 600,000 jobs were directly related to natural gas production, up 20 percent since 2007. While the prices of oil and natural gas historically have run in tandem, a “disconnect” since has occurred, with natural gas remaining much less expensive than petroleum.

The ability to extract natural gas from shale rock and sandstone has changed the equation for the industry, which he calls “a great paradigm shift.” Kirschner notes that ability to effectively combine hydraulic fracturing with horizontal drilling the past decade has unlocked previously unusable reserves.

Horizontal drilling allows access to thousands more feet of resource and minimizes surface disturbances, the NWGA executive director says, remarking that common concerns about fracking entail “water, water and water.”

Oil and natural gas wells are drilled 5,000 to 6,000 feet below drinking water levels, Kirschner notes. Ninety-nine and a half percent of the fracking fluid used is sand and water. Of five million gallons pumped into fracking wells, half a percent typically consists of chemicals and lubricants – or about 25,000 gallons.

Keeping that “cocktail” isolated and separated is a top priority of producers, who use top technology to protect drinking water and are exploring other alternatives, including the use of reclaimed or “gray” water that was not available three years ago. “Water costs producers 15 cents to $15 a barrel,” he says.

The likelihood of fracking fluids contaminating drinking water is “very, very, very low,” Kirschner says. Producers also are looking very closely at reducing related air emissions, including diesel fumes, fugitive methane and particulate matter.

Hydraulic fracturing and well construction are state-regulated, but water disposal falls under the federal Clean Water Act. The U.S. Environmental Protection Agency is considering more stringent fracking regulations.

Scott Madison, executive vice president and general manager of Intermountain Gas and Cascade Natural Gas, North Dakota-based MDU Resources Group subsidiaries, notes that Intermountain Gas – which serves 320,000 customers in 74 communities and employs more than 300 in Idaho – has not filed for a rate increase since 1984. Since 2008, its residential price has decreased 40 percent.

Intermountain Gas secures its natural gas via Williams Northwest Pipeline from British Columbia, Alberta, Colorado, Wyoming and Utah. “We now buy primarily Canadian,” Madison says, adding Intermountain Gas can toggle between Canada and the Rockies, depending on best prices.

The utility will invest $20 million in capital to increase its pipeline capacity by 17 percent from Pocatello to Rexburg via Shelley, Ammon and Rigby in eastern Idaho. It employs 180 employees at its Meridian call center that serves a million MDU electricity and natural gas customers in eight states.

For the past 40 years, those involved in the nation’s natural gas industry estimated only a supply of 10 to 20 years remained, but the success of fracking and horizontal drilling has been “a game changer,” Madison says. “A lot of recovery hasn’t been there before.” More than 100 years supply could now be available.

Frank Morehouse, Madison’s predecessor at Intermountain Gas and new president and chief executive officer of MDU’s utility group, notes that Intermountain Gas has applied for a 6½ percent rate decrease with the Idaho Public Utilities Commission. Its rates have dropped 4 percent to 5 percent each of the last four years.

Morehouse expects Intermountain Gas will gain 4,500 customers in 2013 and natural gas production near Payette in western Idaho could come on line within 12 months. In the past, Intermountain has received 60 percent of its gas from the Rockies and 40 percent from Canada.

“We really need a comprehensive energy policy at the federal level. That’s a very important step to take toward becoming energy independent,” which would strengthen the U.S. position in global energy markets, Morehouse says.

MDU Resources’ utility group includes Intermountain Gas, Montana-Dakota Utilities Co., Great Plains Natural Gas. Co. and Cascade Natural Gas Corp., serving 976,000 customers. MDU employs up to 12,000 people in Washington, Oregon, Idaho, Montana, Wyoming, the Dakotas and Minnesota.

Share on Facebook

2 responses so far

2 Responses to “Prospects for natural gas in Idaho”

  1. fortboiseon 03 Jan 2013 at 9:02 pm

    It’s a good general overview, although might include a counterpoint to the “very, very, very low,” fact-free marketing assurance that drillers won’t contaminate drinking water.

    It also leaves the question about whether the boom in drilling is going to be followed by a bust, now that the resource price has plummeted unasked, as well as unanswered.

  2. Yankeeon 05 Jan 2013 at 2:20 pm

    The Boom has passed…ask the producers royality receiptent in LA and TX. Wells have a fast falloff of roduction and have to be refracked or expanded fracking…but at <$4/MMBtus it ain't really worth producing that is why the prices are hammered between $3.80 to $3.20 – some people are in cash flow problems and 70% of something is better than 100% of nothing…

    For Wyoming-Montana-Idaho-Oregon – you ain't got no endusers with all the hydroprojects – yeah I would prefer seeing you produce aluminum and using it in the US rather than passing the gas by and producing your own for export via Oregon to someone – nope not Japan as China will have that market filled by pipelines rather than tankers. And California is already producing more gas and by 2015 will be self-sufficient – SO YOU GOT TO PRODUCE SOMETHING WITH A LONG SHELF LIFE AND EASY STORAGE….NOT Gas

    OBTW if you produce gas you got to do something with the NG liquids/Condensates/Wet gas/LPG

    BOOMS and BUSTS already here and coming to a gas field near you..

Share on Facebook



WASHINGTON-OREGON-IDAHO Our acclaimed weekly e-pubs: 35-45 pages Monday mornings getting you on top of your state. Samples available. Contact us by email or by phone at (208)484-0460.



This will be one of the most talked-about Idaho books in Idaho this season: 14 years after its last edition, Ridenbaugh Press has released a list of 100 influential Idahoans. Randy Stapilus, the editor and publisher of the Idaho Weekly Briefing and author of four earlier similar lists, has based this one on levels of overall influence in the state – and freedom of action and ability to influence development of the state – as of the start of 2015.
100 Influential Idahoans 2015. By Randy Stapilus; published by Ridenbaugh Press, Carlton, Oregon. 202 pages. Softcover. List price $16.95.
100 Influential Idahoans 2015 page.

100 Influential Idahoans 2015
"Essentially, I write in the margins of motherhood—and everything else—then I work these notes into a monthly column about what it’s like raising my two young boys. Are my columns funny? Are they serious? They don’t fit into any one box neatly. ... I’ve won awards for “best humorous column” though I actually write about subjects as light as bulimia, bullying, birthing plans and breastfeeding. But also bon-bons. And barf, and birthdays." Raising the Hardy Boys: They Said There Would Be Bon-Bons. by Nathalie Hardy; Ridenbaugh Press, Carlton, Oregon. 238 pages. Softcover. $15.95.
Raising the Hardy Boys page.



"Not a day passes that I don’t think about Vietnam. Sometimes its an aroma or just hearing the Vietnamese accent of a store clerk that triggers a memory. Unlike all too many soldiers, I never had to fire a weapon in anger. Return to civilian life was easy, but even after all these years away from the Army and Vietnam I find the experience – and knowledge – continue to shape my life daily."
Drafted! Vietnam in War and in Peace. by David R. Frazier; Ridenbaugh Press, Carlton OR. 188 pgs. Softcover. $15.95.
The DRAFTED! page.


Many critics said it could not be done - and it often almost came undone. Now the Snake River Basin Adjudication is done, and that improbable story is told here by three dozen of the people most centrally involved with it - judges, attorneys, legislators, engineers, water managers, water users and others in the room when the decisions were made.
Through the Waters: An Oral History of the Snake River Basin Adjudication. edited by the Idaho State Bar Water Law Section and Randy Stapilus; Ridenbaugh Press, Carlton, Oregon. 300 pages. Softcover. $16.95.

Oregon Governor Vic Atiyeh died on July 20, 2014; he was widely praised for steady leadership in difficult years. Writer Scott Jorgensen talks with Atiyeh and traces his background, and what others said about him.
Conversations with Atiyeh. by W. Scott Jorgensen; Ridenbaugh Press, Carlton, Oregon. 140 pages. Softcover. $14.95.

"Salvation through public service and the purging of awful sights seen during 1500 Vietnam War helicopter rescue missions before an untimely death, as told by a devoted brother, leaves a reader pondering life's unfairness. A haunting read." Chris Carlson, Medimont Reflections. ". . . a vivid picture of his brother Jerry’s time as a Medivac pilot in Vietnam and contrasts it with the reality of the political system . . . through the lens of a blue-collar, working man made good." Mike Kennedy.
One Flaming Hour: A memoir of Jerry Blackbird. by Mike Blackbird; Ridenbaugh Press, Carlton, Oregon. 220 pages. Softcover. $15.95.
See the ONE FLAMING HOUR page.

Back in Print! Frank Church was one of the leading figures in Idaho history, and one of the most important U.S. senators of the last century. From wilderness to Vietnam to investigating the CIA, Church led on a host of difficult issues. This, the one serious biography of Church originally published in 1994, is back in print by Ridenbaugh Press.
Fighting the Odds: The Life of Senator Frank Church. LeRoy Ashby and Rod Gramer; Ridenbaugh Press, Carlton, Oregon. 800 pages. Softcover. $24.95.


by Stephen Hartgen
The personal story of the well-known editor, publisher and state legislator's travel west from Maine to Idaho. A well-written account for anyone interested in Idaho, journalism or politics.
JOURNEY WEST: A memoir of journalism and politics, by Stephen Hartgen; Ridenbaugh Press, Carlton, Oregon. $15.95, here or at Amazon.com (softcover)



NEW EDITIONS is the story of the Northwest's 226 general-circulation newspapers and where your newspaper is headed.
New Editions: The Northwest's Newspapers as They Were, Are and Will Be. Steve Bagwell and Randy Stapilus; Ridenbaugh Press, Carlton, Oregon. 324 pages. Softcover. (e-book ahead). $16.95.
See the NEW EDITIONS page.

How many copies?


The Field Guide is the reference for the year on Oregon politics - the people, the districts, the votes, the issues. Compiled by a long-time Northwest political writer and a Salem Statesman-Journal political reporter.
OREGON POLITICAL FIELD GUIDE 2014, by Randy Stapilus and Hannah Hoffman; Ridenbaugh Press, Carlton, Oregon. $15.95, available right here or through Amazon.com (softcover)


by Randy Stapilus and Marty Trillhaase is the reference for the year on Idaho Politics - the people, the districts, the votes, the issues. Written by two of Idaho's most veteran politcal observers.
IDAHO POLITICAL FIELD GUIDE 2014, by Randy Stapilus and Marty Trillhaase; Ridenbaugh Press, Carlton, Oregon. $15.95, available right here or through Amazon.com (softcover)

without compromise
WITHOUT COMPROMISE is the story of the Idaho State Police, from barely-functioning motor vehicles and hardly-there roads to computer and biotechnology. Kelly Kast has spent years researching the history and interviewing scores of current and former state police, and has emerged with a detailed and engrossing story of Idaho.


How many copies?
The Old West saw few murder trials more spectacular or misunderstood than of "Diamondfield" Jack Davis. After years of brushes with the noose, Davis was pardoned - though many continued to believe him guilty. Max Black has spent years researching the Diamondfield saga and found startling new evidence never before uncovered - including the weapon and one of the bullets involved in the crime, and important documents - and now sets out the definitive story. Here too is Black's story - how he found key elements, presumed lost forever, of a fabulous Old West story.
See the DIAMONDFIELD page for more.

Medimont Reflections Chris Carlson's Medimont Reflections is a followup on his biography of former Idaho Governor Cecil Andrus. This one expands the view, bringing in Carlson's take on Idaho politics, the Northwest energy planning council, environmental issues and much more. The Idaho Statesman: "a pull-back-the-curtain account of his 40 years as a player in public life in Idaho." Available here: $15.95 plus shipping.
See the Medimont Reflections page  
Idaho 100, about the 100 most influential people ever in Idaho, by Randy Stapilus and Martin Peterson is now available. This is the book about to become the talk of the state - who really made Idaho the way it is? NOW AN E-BOOK AVAILABLE THROUGH KINDLE for just $2.99. Or, only $15.95 plus shipping.

Idaho 100 by Randy Stapilus and Martin Peterson. Order the Kindle at Amazon.com. For the print edition, order here or at Amazon.