Seismologist Austin Holland of the Oklahoma Geological Survey recently told Reuters that the state of Oklahoma has already surpassed 252 earthquakes thus far in 2014, which is already more than record 222 quakes seen in all of 2013. This is insane considering that fracking has been linked to earthquakes, largely due to the wastewater from the controversial drilling technique being reinjected into the earth's core.
So while states such as Ohio and Texas have also witness increased seismic activity, Oklahoma is the only state thus far proposing to have operators record injection well pressure daily instead of monthly. This rule, if approved by Oklahoma's Governor, may inadvertently help Nuverra (NYSE:NES), which has been struggling financially. The new rule could make the company hopeful that its partnership with Halliburton (NYSE:HAL) for a program called H2O Forward Service will allow drillers to reuse water time and time again throughout the fracking process.
The treatment of flowback, produced, and drilling water is crucial for Nuverra because of growing environmental concerns related to fracking coupled with the fact drillers are finding that increased water use is yielding better volumes from wells. The H2O Forward Service could allow the industry to cut back on 25% of fresh water use by using treated water that doesn't contain additives that could be leading to earthquakes when injected into the ground. This is important for Nuverra since the company divested its Thermo Fluids business for $175 million earlier this month and now is putting all of its chips on its core shale environmental business. This focus could make more stringent fracking regulations and the whole notion of recording injection well pressure daily even more important for Nuverra's success, especially as drilling picks up again now that spring is finally back in the air.
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