Natural gas has become a major part of our lives, but have you ever thought about the natural gas wells that hold this incredible and essential resource?
Most people use natural gas-powered appliances every single day, and they don’t think twice about it.
So let’s dive deeper into where your energy comes from with the top things you should know about natural gas wells.
1. What is natural gas?
Natural gas is an odorless, gaseous mixture of hydrocarbons.
It is mainly composed of methanes.
It occurs naturally underground and is commonly used as fuel.
2. How does natural gas form?
Natural gas formed over hundreds and millions of years from the remains of plants and animals being mixed with sand, silt, and calcium carbonate.
As these remains became buried under the sand, silt, and rock, heat and pressure transformed the organic carbons into coal, oil, and natural gas.
3. Where is natural gas found?
Natural gas can be found in numerous places.
It’s sometimes found in large cracks and spaces between layers of overlying rock.
The name for this type of natural gas is conventional natural gas.
Otherwise, it may be in the tiny pores in shale, sandstone, or sedimentary rock.
This is known as unconventional natural gas.
It can also occur in the deposits of crude oil, which is called associated natural gas.
Additionally, there are natural gas deposits that are found on land, offshore, or deep under the ocean floor.
Finally, you can find natural gas in coal deposits (also known as coalbed methane).
4. How do we find natural gas and what happens when it’s found?
To find natural gas, geologists study the structure and processes of the Earth.
They try to locate the types of geologic formations described above that are most likely to contain natural gas deposits.
One way that they do this is by using a seismic survey to find the right places to drill natural gas and oil wells.
These surveys create and measure seismic waves in the Earth to gain information about rock formations.
Sometimes this is done with a thumper trick and other times it’s done with blasts of sound to create sonic waves.
After seismic survey results indicate the positive potential for the production of natural gas, an exploratory well will be drilled and tested.
If the results from this well are shown to be positive and profitable, then more production wells will be drilled.
5. Why is it called a gas well?
When people hear the term “well,” they mostly think of water wells in the ground.
However, a natural gas well doesn’t work in the same way.
To create a water well, you drill into the ground and let the hole fill with water.
To create a natural gas well, you must drill further into the rock itself.
Because you’re going underground, the well is both deeper and more dangerous to create.
6. How is a natural gas well created?
Above, we’ve detailed the process of looking for seismic activity beneath the Earth to determine if deposits are likely.
To remove gas from the ground, the rock beneath the surface must be broken so it releases the gas.
That said, the rock can’t be broken in the incorrect way.
Otherwise, it can contaminate the groundwater and cause numerous other issues.
Thus, it’s critical that the proper precautions are taken before drilling.
To create a well, the drilling company will drill a hole down into the rock.
Next, they’ll line the hole with material designed to keep gas in.
This step will ensure that they get as much gas as possible from the well.
Then, electric changes will be sent down the hole to impact the rock.
Finally, a liquid fracking solution will be sent down the well to break up the rock safely.
Voila! Natural gas will be released, and it’ll rise to the top of the well to be captured.
7. What are the different types of natural gas wells?
There are numerous types of gas wells that are all designed for the same purpose — to get the gas from any type of underground deposit.
Here are the important ones to know about.
Natural gas wells:
This type of well is created to retrieve the gas from below the ground.
It’s the primary type we’re discussing in this blog.
Condensate natural gas wells:
This type of well has liquid condensate in addition to natural gas.
The gas rises to the top thanks to its light properties.
Oil wells:
This type of well is an oil well that has natural gas present as well.
Gas will be used to help extract oil. If there’s enough gas to harvest, then it’ll also be extracted with the oil.
8. What are private natural gas wells?
Most private natural gas wells are owned by gas companies looking to harvest and sell natural gas.
However, many private homeowners also sink their own natural gas wells for their financial benefit.
Here’s why you might consider using your land this way if you know there’s natural gas to be harvested.
You can use the gas you obtain to power your own home and appliances
You can save quite a bit of money on your utility bills by having access to your own natural gas
You can sell any extra natural gas that you obtain through your well
You can offset the cost of sinking a natural gas well by selling it to others, and once this is done, what’s left is pure profit
You can harvest gas that may be left untapped and unused otherwise
However, there are also some downsides to private natural gas wells.
Here’s why you may want to think twice before jumping into this business.
You may find it difficult to get permission to sink a well on your property
You may not find enough gas on your property to make a well profitable
You may not find it worth the expense of sinking a well
You may not be interested in the natural gas business in the long-term
9. What are the dangers of sinking natural gas wells?
Obtaining fuel can be a dirty and dangerous business.
When you talk about modern wells, most of the controversy arises when you bring up the word fracking.
This process can be especially dangerous for the land and environment.
If you’re a property owner, you may be rightfully worried about what sinking a natural gas well will do to your land and its value.
Here are some things you should know.
Pollution
One of the top concerns with fracking is that the water will be polluted with chemicals if the process goes wrong.
The surrounding area and residents will be dramatically impacted if their water supply is now tainted.
This is enough for many people to say they don’t want wells drilled near their homes.
Impact
The drilling process isn’t for the faint of heart.
It often causes a lot of upheaval in an area as the well is sunk.
This involves a lot of noise and construction, which not many people enjoy.
Not to mention it absolutely ruins habitats and ecosystems.
For some people and economies, the benefit of retrieving natural gas makes this process all worth it.
For others, knowing that their water supply could be tainted and their ecosystems destroyed is terrifying.
10. What are the advantages and disadvantages of using natural gas wells?
Natural gas has both pros and cons.
PROS
Natural gas is abundant
There’s a rising demand for natural gas, and there are numerous reasons why.
However, a primary one is that it’s an abundant resource.
The IEA (International Energy Agency) estimates that there are enough natural gas resources for around 230 years.
Natural gas has low carbon dioxide and greenhouse gas emissions
Natural gas expels the least carbon emissions of all fossil fuels.
Thus, it produces less pollution while still having a high energy output.
This makes it an appealing option if we must choose some nonrenewable power source while still trying to mitigate the impacts of climate change.
Natural gas is easily and efficiently transported through a pipeline
When natural gas is cooled to -161.5 degrees Celsius, it becomes a liquid.
This makes it easier to store and transport long distances. In most cases, this is done via a pipeline.
Many pipeline routes are established, and this infrastructure is also being expanded.
Natural gas is a versatile energy source
Natural gas can do everything from power electrical grids and heating systems to run home cooking appliances and certain vehicles.
The fact that it’s so versatile has made it increasingly popular.
Natural gas is a cost-efficient fuel
Compared to oil or coal, natural gas is much less expensive.
As a result, it’s often used for power generation.
CONS
Natural gas is a fossil fuel
While natural gas’ carbon emissions are lower than other fossil fuels, it’s still a fossil fuel.
Natural gas can cause methane leaks
The way natural gas is transported releases methane which has a higher climate change potential than carbon dioxide.
Additionally, methane leaks are pretty difficult to avoid.
Natural gas can experience price volatility
Because Russia essentially controls the natural gas market in Europe (and somewhat Asia), transport and political tensions can lead to volatile gas prices in both regions.
Natural gas infrastructure is currently being developed in Europe and Asia.
The U.S. has an easier time keeping prices stable because of its natural gas supply chains.
Natural gas is most commonly sourced by fracking
Fracking sources about 67 percent of natural gas.
Unfortunately, it’s also been linked to several major health issues, environmental damage, and large methane leaks.
Natural gas can be dangerous
As a highly flammable and combustible substance, natural gas can cause more damage if it leaks.
11. What is the lifespan of a well?
The average lifespan of a natural gas well is about 20 to 30 years.
However, state data from Colorado suggest that the average Coloradan well’s life is more like 12 years.
12. How are wells classified?
Natural gas wells can be classified in six ways: active, inactive, suspended, abandoned, orphaned, or reclaimed.
In general, the life cycle of a well moves from “active” to “reclamation.”
Active
A well is considered active when it’s producing either natural gas or oil.
Inactive
If a well hasn’t produced either natural gas or oil in the last 12 months, then it’s considered inactive.
However, this is normally a temporary situation.
Production is typically expected to restart with an inactive well.
Suspended
A suspended well isn’t producing either oil or natural gas.
That said, production is potentially anticipated in the future, so it’s been safely secured.
If the well moves back into production, then it’ll take some effort to reverse the security measures.
Abandoned
Abandoned wells are those that are permanently shut down.
To be considered safe and secure by regulators, they must be plugged with their wellhead removed.
When a well is abandoned, the site must be remediated and reclaimed.
The companies that do this also assess the presence of soil contamination and produce a report detailing how contamination will be mitigated.
The remediation of abandoned sites must align with governmental requirements.
Orphaned
While active, inactive, suspended, and abandoned wells are all managed by the well owner (also known as the licensee), orphaned wells have no identifiable owner.
This is an issue because owners are responsible for abandonment and reclamation tasks and costs.
Some places like Alberta have industry-funded Orphan Well Associations.
They work on behalf of the province to reclaim the wells.
However, if the government doesn’t have this type of system in place, then it can become a problem for the community and environment.
For context, the U.S. has more than 120,000 orphaned oil and gas wells.
Reclaimed
If a natural gas or oil well is no longer productive or in use for one reason or another, the operating site can be reclaimed by removing the equipment.
This process must be done to current regulatory standards.
13. Do natural gas wells leak?
Yes, natural gas wells can leak.
Because natural gas has no odor, this can be especially dangerous.
To combat this, gas companies will add a harmless chemical called mercaptan to give natural gas in wells a distinctive smell.
Unfortunately, the distinctive smell isn’t all that pleasant.
It smells like rotten eggs, which is pretty gross.
Still, it’s important to recognize that this smell is natural gas and what to do if you smell it.
14. What to do if you smell natural gas?
What to do depends on where you smell the natural gas.
If you smell natural gas in your home, you should call your local gas company from a phone that is as far from the smell as possible.
If possible, leave the building before you call the company.
The company can come to the building and ensure that the area is safe.
While you wait, follow these tips:
Clear the area — no one should be near the odor
Do not smoke or strike any matches
Do not light any candles
Do not flip light switches on or off
Do not use a telephone
Do not use any electrical equipment or light that could create a spark in the area of the odor
Do not use the doorbell
Do not adjust thermostats or appliance controls
Do not use elevators
Put out any present open flames
If you stumble upon the odor outside, then it should be reported immediately.
However, you shouldn’t try to investigate the smell or its source.
Leave it to the gas company.
Just be careful not to position or operate vehicles or powered equipment where leaking gas may be present.
Additionally, if you’re hearing the sound of escaping gas in addition to smelling it, call the gas company, remain outside the building until the gas company clears it, and keep others away from the area.
Final Thoughts
Natural gas wells can be a controversial topic because this abundant resource is often harvested by fracking.
Natural gas is a fossil fuel, and its extraction can cause real damage to the environment.
Yet, compared to other nonrenewable energy sources like oil and coal, natural gas is a better option.
Thus, it’s worth exploring all sides of the argument when it comes to natural gas wells.
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Disclaimer: we are not lawyers, accountants or financial advisors and the information in this article is for informational purposes only. This article is based on our own research and experience and we do our best to keep it accurate and up-to-date, but it may contain errors. Please be sure to consult a legal or financial professional before making any investment decisions.
Prior to starting Gokce Capital, Erika received a Bachelor of Architecture from the University of Southern California and a graduate degree in Urban Policy from Columbia University. She worked as both an architectural designer and engineer in New York before joining the New York City Department of Housing Preservation and Development.
Erika currently lives in the New York Metropolitan area with her spouse, daughter and cat. She is originally from Chicago and still considers herself a midwesterner at heart.
Erika also loves to read, write and travel (fun fact, she has visited all 50 states and more than 30 countries!). Her new book, Land Investing Mistakes: 11 True Stories You Need To Know Before Buying Land, is now available on Amazon.