Running Header: Fracking

Fracking

Fracking

Introduction

Exxon Mobil is the world's largest publicly traded company in terms of revenue. It was formed November 30, 1999, by the merger of Exxon and Mobil. Both companies had been successors to parts of the Standard Oil Trust first created in 1870 by John D. Rockefeller. Standard Oil had been broken up as a monopoly by order of the U.S. Supreme Court in 1911. As with other major oil companies, production of crude oil is its lifeblood. At the beginning of 2008, it had proven reserves of 72 billion barrels of oil. Given current rates of production, these reserves are expected to be exhausted in 2022. However, successful exploration is expected to extend the pool of Exxon Mobil's reserves for additional decades. In addition to oil exploration and production, Exxon Mobil also refines oil. The company currently operates 38 refineries in 21 countries with a daily capacity of 6.3 million barrels.

Problem Statement

Fracking or commonly known as Hydraulic fracturing is a drilling method that involves high-pressure injections of water and chemicals and sand that allow natural gas trapped in rock formations to flow. The technique has enabled companies like Exxon to tap the vast natural-gas supplies in the country's shale formations. Rapid expansion of shale gas development, which requires advanced drilling techniques like fracking, has brought with it environmental and public health concerns. Critics warn that chemicals used in fracking could contaminate groundwater, among other things.

There are abundant reserves of it in North and South America, Europe and Asia Pacific, particularly in China. With the addition of shale gas reserves, the world's total technically recoverable natural gas resources has been increased by around 40% to 22.6 according to figures from the US Energy Information Administration (EIA). Furthermore, for electricity generation, shale gas has a lower CO^ output than oil so could make a major contribution to curbing global warming. However a major drawback to shale gas is that the hydraulic fracturing or 'fracking' technology used in its production is regarded as a serious potential threat to the environment and to human health. If shale gas is to realize its potential as a source of energy, hydraulic fracturing, which with horizontal drilling is used to create fissures in very tight shale rock to extract natural gas, will have to be made safer. Or environmentally-safer alternatives will have to be developed and widely commercialized.

Another option is for the authorities and the gas industry to win the trust of a skeptical public by keeping the risks from hydraulic fracking well under control through close monitoring and the introduction of best practices.

In the US where currently the vast majority of the world's shale is produced commercially, large sections of the population, particularly in areas of shale gas plays or operations, lack confidence in the safety of fracking. This has triggered campaigns for much stricter regulation and controls combined with greater transparency about the dangers of fracking chemicals. Around 30-40% of shale gas resources in the US are in the giant Marcellus Shale ...