What is 'Hydraulic Fracturing'

Hydraulic fracturing is a process which injects high-pressure liquid into an oil- or gas-bearing rock formation to create fractures. This pressure typically yields improved flows, making it useful for oil and gas firms seeking more economical production in areas that would otherwise produce low-flow wells.

BREAKING DOWN 'Hydraulic Fracturing'

Hydraulic fracturing involves pumping fuel into a wellbore to create enough pressure to develop and expand cracks in hard rock formations. The fluid injected into the well contains a combination of water, chemicals and small particles of sand or ceramic materials. The water and chemicals crack and open the rock through high pressure, while the solid particles, called proppant, stay in place and keep the fractures open to stimulate a better flow of liquids or gases out of the well.

History and Use of Hydraulic Fracturing

Hydraulic fracturing was first used in Kansas in 1947 in an attempt to extract natural gas from a limestone formation in the Hugoton gas field. Since that time, petroleum engineers have regularly used hydraulic fracturing as a means of increasing well production. While fractures sometimes exist naturally in formations, both natural and human-made fractures can widen by this process.

Hydraulic fracturing is one of several technologies which have made unconventional oil and gas plays more economically viable. Tight oil and gas reservoirs, including those embedded within shale formations such as the Bakken, Eagle Ford, Niobrara and Pierre formations in the United States, typically require a combination of horizontal drilling and hydraulic fracturing to produce efficiently.

Environmental and Political Hydraulic Fracturing Controversy

Environmental concerns linked to hydraulic fracturing include air pollution from methane emissions, groundwater contamination, and potential risk of induced earthquakes. The disposal of wastewater from the drilling process plays a primary role in many disagreements about how to weigh the technology’s risks against its benefits.

After drilling companies inject fluids into the well, the back-pressure from the rock formation generally pushes the mix of water and chemicals back to the surface through the wellbore. At that point, the fluids can be recycled or collected for eventual disposal. Drilling companies take precautions to ensure their wells do not leak either fracturing fluids or petroleum liquids into local water tables. However, environmental groups have voiced concerns about contamination from inadequate holding tanks and spills. Some operations dispose of wastewater in deep wells, which has recently been correlated with increased risk of earthquakes in Oklahoma. Another problem linked to hydraulic fracturing is the leakage of methane gas from the fracking process. 

These concerns have made the hydraulic fracturing process subject to strict regulation in some areas, including outright bans in France and the states of Vermont and New York.

RELATED TERMS
  1. Oil Field

    An oil field is a tract of land used for extracting petroleum, ...
  2. Oil Shale

    Oil shale is a sedimentary rock containing enough kerogen that ...
  3. Produced Water

    Produced water is waste water generated during the production ...
  4. Groundwater

    Groundwater is water that is below the land surface of the earth.
  5. Hydrocarbon

    An organic chemical compound composed exclusively of hydrogen ...
  6. Alexander M. Cutler

    The CEO and chairman of power-management company Eaton Corporation. ...
Related Articles
  1. Investing

    What is Fracking?

    Fracking, a slang term for hydraulic fracturing, is a method for extracting natural gas from sedimentary rocks.
  2. Investing

    With Fracking It’s All About Water Management

    It takes an awfully large amount of water to frack an oil and gas well these days. Given the growth projections for production activity in the U.S. and Canada, water management could be one of ...
  3. Investing

    Is Emerge Energy Services Stock a Buy? (EMES)

    Ever since Emerge Energy Services' (NYSE: EMES) IPO back in 2013, its shares have been on a journey that looks an awful lot like the flight of Icarus. The company's business, which held so much ...
  4. Investing

    The Cost of Shale Oil Versus Conventional Oil

    Fracking technology has brought new costs to the oil extraction process, and that has an impact on the profitability of the deposits being drilled.
  5. Investing

    Fracking Companies: Practices, Profit Opportunities & Outlook

    Learn about the business opportunities available to companies in the fracking, how they operate and new innovations going on in the stream.
  6. Investing

    How Fracking Affects Natural Gas Prices

    Whatever you think of fracking, it has done one thing: kept the price of natural gas from increasing any more than it has.
  7. Investing

    The Smartest Strategies For Trading Natural Gas Options

    There are multiple strategies for trading natural gas options, once you have the right data. Here we discuss the basics.
  8. Investing

    Countries With The Highest Fracking Potential

    Is fracking a "necessary evil," as some believe? Here are some countries with huge fracking potential--and what they stand to lose or gain from fracking.
  9. Investing

    Oil and Gas Bankruptcies Rival 2003 Telecom Bust (FRAK)

    The squeeze in the once-thriving oil and gas industry has led to a wave of bankruptcies that is now rivaling previous record busts.
RELATED FAQS
  1. What are the effects of fracking on the environment?

    Understand what environmental concerns exist as it relates to fracking is necessary in weighing the benefits and caveats ... Read Answer >>
  2. What percentage of the global economy is comprised of the oil & gas drilling sector?

    Read about a rising industry that already composes as much as one-twentieth of total global economic output: the oil & gas ... Read Answer >>
  3. What are the main benchmarks that track the oil & gas drilling sector?

    Read about several different types of benchmarks that investors can use to track the overall performance of the oil and gas ... Read Answer >>
  4. What are average operating expenses for the oil and gas sector?

    Learn about the average operating expenses and average operating expenses margin for the oil and gas sector and how they ... Read Answer >>
Hot Definitions
  1. Economies of Scale

    Economies of scale refer to reduced costs per unit that arise from increased total output of a product. For example, a larger ...
  2. Quick Ratio

    The quick ratio measures a company’s ability to meet its short-term obligations with its most liquid assets.
  3. Leverage

    Leverage results from using borrowed capital as a source of funding when investing to expand the firm's asset base and generate ...
  4. Financial Risk

    Financial risk is the possibility that shareholders will lose money when investing in a company if its cash flow fails to ...
  5. Enterprise Value (EV)

    Enterprise Value (EV) is a measure of a company's total value, often used as a more comprehensive alternative to equity market ...
  6. Relative Strength Index - RSI

    Relative Strength Indicator (RSI) is a technical momentum indicator that compares the magnitude of recent gains to recent ...
Trading Center