The Boom (32 page)

Drilling rigs were slower to come to Sullivan County than to neighboring counties. To the north, Bradford County had 1,821 shale wells, drilled or permitted, as of the summer of 2012, and Tioga County had 1,138. To the west, Lycoming County had 926. Sullivan County had 166. The reason Sullivan has seen less activity is that there are no pipelines to get natural gas out of the area. By the end of 2012, the Marc 1 Hub pipeline was assembled, welded together, and buried at least three feet deep. A thirty-inch-high pressure gas pipeline, it runs for thirty-nine miles, crossing more than one hundred streams and creeks, as well as the Susquehanna River. It is a new major artery in the nation’s gas grid, connecting two giant pipelines that carry gas from the Gulf Coast up into the populated Eastern Seaboard. As it crosses through Sullivan County, it takes feeds from new wells that have been drilled but during the summer had yet to be turned on. The Marc 1 began operations on December 1, 2012, and in the days that followed, gas began to flow for the first time from the county. Some of it heads north to connect to the Tennessee or Millennium pipelines and from there to New England. The gas can also head south into a spur of the Transco pipeline, the largest in the United States by volume, which feeds into the New York metropolitan region. Plans are afoot to add another pipeline leg that will allow gas from Sullivan County to head to consumers from Washington, DC, to Boston.

As the large Marc 1 inched closer to completion, gas companies scrambled to put in a grid of smaller pipes that will connect each well to eastern consumers. During my stay, these connector pipes were spreading across Sullivan County as quickly as the heavy machinery could negotiate the windy roads and cut down wide paths through the trees. (Roads not designed for a heavy influx of trucks remain a problem. A local saying is that the county’s largest road was designed by a slow snake; the second largest road by a fast snake.) The landscape is being transformed. Before 2006, you could drive over a crest in the road, and a picture postcard scene unfolded of hay bales in a field and a weathered gray silo with a silvery dome next to a red barn. Around the corner was a snapshot of rural poverty, a dilapidated trailer with a wooden porch that sagged precariously. Now a third image had joined the tableau: the straight brown strip of newly turned earth, cutting a straight line through a field or the woods, with lengths of green-wrapped steel pipe on wooden braces ready to be installed.

Bill Hart, a dairy farmer in his seventies, offered me a tour of these new pipelines on his low-to-the-ground, four-wheel-drive all-terrain vehicle. He drove like a teenager given the keys to the family car for the first time. He descended embankments with abandon. “I am going to take you up here and show you one of the things that bothers me to no end,” he said, before gunning the ATV into a field, the engine grumbling so loudly that we had to yell at each other to be heard above the din. After negotiating a field of oats and rye, we drove out of the crops and down a two-foot cut into a brand-new pipeline right-of-way. Machines had come through and cleared out every hint of vegetation. Driving in this earthen artery, he paused to point out a sixty-foot tree right on the dividing line between the cut and the forest.

“See that nice cherry tree there? This one right here. Oh, that’s a wonderful tree. But look what they did to the roots. That tree is going to die,” he said. The machine that resculpted the land had sliced off part of the roots, leaving behind fleshy wood exposed. “Carl Driscoll used to own that land. He bought fertilizer from me for these trees. I don’t know where he is buried, but I know he is turning in his grave.” What bothers him, Hart said, is the waste. “They could do different, they do not need to cut eighty to ninety feet for a sixteen-inch pipeline,” he said.

For the next hour, we sped around his and neighboring farms, cutting through fields and bumping along paths in the woods. He complained that gas companies weren’t “conservative,” a word he uses not in a political sense but to mean that they aren’t intent on conserving. “Farmers are tighter than hell; we don’t want to see anything wasted. You put your tomatoes on your plate, you clean up your plate. That is just the way farmers are.” The gas companies are different. The pipeline rights-of-way will be kept clear so that gas companies can fly over them looking for any signs of leaks. “You will never use that land again; it will never be any good for anyone. That land is totally wasted,” he said. “What is it going to harvest?” He has been farming and raising cows since the 1950s and has adapted to considerable changes in the dairy industry. But nothing prepared him for the changes brought by the gas industry: the wells and traffic and pipelines. He remembers his father signing two-year gas leases for a quarter an acre. “They didn’t do anything. It was kind of free money,” he said. I asked if anyone anticipated the magnitude of change in the past couple years. “No. None. I don’t think anyone did.”

On his tour, he pointed out not just who owned a field, but who owned it a generation or two ago. The land for him isn’t merely a plot. It’s a connection to the past and to his family. As we head back toward his house, he points out an acre lake with a couple small boats on the shore. “I built that after my first wife died. That first winter, just for something to do,” he said. As he pulled up behind his house, he said he wanted to show me one more thing. He opened a garage bay, and inside was a meticulously restored 1969 Cadillac convertible, a shiny crimson car with a “Boss Hart” vanity plate. The car looked brand new. “Maybe I’m too much of a conservative,” he said. “I don’t know.”

Through Hart’s eyes, Sullivan County is being irrevocably remade by outsiders who don’t share his reverence for the land. And to what end? The changes will provide an abundance of natural gas that will reshape the energy landscape just as surely as it is reshaping Sullivan County. Once the Marc 1 is connected, natural gas from Sullivan County will become part of a surge of new gas heading toward coastal cities. The result, according to federal projections, will be that gas—and to an extent renewable energy also—will displace coal-fired power plants, sending somewhere between 11 percent and 22 percent of existing coal plants into retirement. Federal forecasters say the availability of cheap natural gas, in fact, makes it considerably easier to introduce new clean-air standards and increase renewable power without sending power prices skyward. Marcellus gas will help undo many of the changes wrought by a poorly conceived energy policy in the late 1970s. Worried about declining supplies of domestic natural gas, Congress outlawed all new gas-fired power plants. In the nine years that the Powerplant and Industrial Fuel Use Act of 1978 was law, the coal industry went on a building spree. One of every five coal power plants in the country was built during this window of time. Signing its repeal in 1987, President Ronald Reagan pointed out that burning gas emits fewer pollutants than burning coal. “As natural gas is a clean-burning fuel, restrictions inhibiting its use have not been in the best interests of the environment,” he said.

As Marcellus gas flows east to the coastal cities, forecasters expect it to keep power prices from rising too quickly. Electricity prices are expected to rise slowly over the next couple decades, due to low natural gas prices and improving energy efficiency. Sullivan County will benefit from moderate electricity bills, but many residents may never get a chance to use the gas to keep warm or boil water. The towns are too small to justify construction of a local gas distribution network. After Sullivan is drilled up, most residents will still rely on heating oil and wood to keep warm in the winter.

There are other economic benefits to Sullivan County. The most obvious is that landowners who leased in 2008 and 2009 received thousands of dollars per acre, plus up to 25 percent of the royalties from gas produced on their land. The influx of oil-field workers and demand for oil-field services were having an impact. A company that refurbishes oil-field equipment had set up a shop in Sullivan County, as had another that provides sand for fracking operations. More than one hundred cars parked in the lot of the company installing the Marc 1. One longtime farmer and his wife told me quite happily that one of their grandsons had moved back because he got work driving a truck hauling water for frack jobs. In Dushore, the largest town in Sullivan County, a local dentist had taken out a loan to build the first new hotel in a century. Construction had barely begun when oil companies began inquiring about renting rooms for months at a time.

“This is the biggest—for lack of a better word—economic development in this county since lumbering,” said Sullivan County commissioner Bob Getz, a garrulous man who ran for office after decades working for the state as an auditor. “We’re just getting started here. It happened very quick, very fast,” he said.

Down the street from the new hotel is the county’s only auto dealership. Its parking lot is crammed with a couple dozen brand-new jumbo Ford F-250 pickups. They are selling briskly to oil-field workers. A rig worker, often with a high school education and a willingness to work long hours, can earn a nearly six-figure income. Other than drilling and fracking wells, this kind of paycheck is practically impossible to find in central Pennsylvania. But the hefty compensation is, in part, to compensate for the dangers of the work. In January 2011 a high-pressure hose was left unsecured on a drilling rig on the western side of the county. The hose, which delivered a specialized fluid to keep the drill bits operating smoothly, thrashed about and struck a thirty-year-old father of two young children in the head. He died by the time a helicopter airlifted him to a nearby hospital.

Development of the Marcellus Shale began slowly in late 2004. A small Fort Worth company called Range Resources decided to try a modern slick-water frack into the Marcellus Shale. The first well where it pumped a “Barnett-style” frack, using one million gallons of water along with a smaller quantity of chemicals, was southwest of Pittsburgh. Previously, the largest frack in the area had pushed sixty thousand gallons into the well. Early on, Range’s biggest problem was that Pennsylvania was an outdoor museum of drilling equipment. To drill the experimental Marcellus well, called the Renz #1, Range wanted to use a giant spool of pipe called a coiled tubing unit that can be put into the well quicker than using straight segments that have to be screwed one into the next. There weren’t any units in Pennsylvania, but Range found one in Kentucky. The driver hit a bridge abutment on his way north. When it arrived, there was no one with any experience using it. Range executives used the corporate jet to rush three operators up from Texas. Later, when Range needed an expert on drilling shale, it hired a consultant and told him to be in Pittsburgh within two days. He made plans to drive to nearby Pittsburg, Texas, before he realized the misunderstanding. When he arrived in Pennsylvania, he said it “was like stepping back in time a hundred years.”

John Pinkerton, Range’s CEO at the time, said it was a mistake to use available local drilling crews on the type of modern, complex wells he was drilling. “We had Appalachian equipment and Appalachian crew,” he said. When they got a crew that understood modern fracks into southeastern Pennsylvania, they miscalculated the weather. “It was a bunch of guys from Texas” who didn’t realize how cold it would get overnight, said Pinkerton. “Everything was freezing. It was just a disaster.” Despite these missteps, Range knew that it was on to something. The Marcellus Shale had a lot of gas and, when the wells were built right, could be fracked. Range began leasing up acreage for $25 to $50 an acre. Within two years, Range went from having 38,000 acres under lease to 250,000 acres.

When the results of Range’s first few wells became public, other companies started paying attention. Men parked on the roads near their wells, watching Range’s wells through binoculars. “Aubrey has got people everywhere,” Pinkerton said, referring to Chesapeake’s CEO. Asked if they were spying, he replied, “Oh yeah. All the time.” McClendon liked what his scouts saw. Chesapeake, in late 2005, spent $2.2 billion to buy a company with a lot of acreage in Appalachia and then unleashed its army of landmen. Chesapeake drilled its first horizontal well targeting the Marcellus in September 2007.

As usual, it was Chesapeake’s giant appetite and willingness to spend freely that transformed the Marcellus Shale and the land above it. Acreage that could be had for $200 an acre spiked to $1,000 and kept rising until it peaked around $6,000. Pinkerton said Chesapeake’s large wallet caused him—and any other company that was eying the Marcellus—to speed up and move faster. Landmen spread out across the state and leasing begat a drilling scramble. In 2007 there were 71 permits submitted to drill into the Marcellus Shale. By 2010, there were 3,316 permit requests. Equipment and labor were in short supply. New equipment was built and moved into the Marcellus, but it wasn’t enough. Any rig that could be repurposed to drill a mile down was used, even though most of the equipment in Pennsylvania was intended for much shallower, lower-pressure wells.