Tuesday, July 17, 2012

Shale Wealth Spreads Halfway Around the World to Poor Indian Farmers Growing Beans for Fracking

Yesterday, I wrote a post about the new "sand millionaires" and "sand prosperity" in Wisconsin and Minnesota because of the "frac sand boom" going on there.   

In June, I featured a WSJ article about how the U.S. shale revolution is spreading prosperity to poor farmers on the other side of the planet in India who are growing guar beans (pictured above), which are now used extensively to extract shale oil and gas in the U.S. using advanced hydraulic fracturing technology.

The New York Times has a related front page article today about how "India's dirt-poor farmers are striking gas-drilling gold" with the guar bean, here's an excerpt:

"Guar, a modest bean so hard that it can crack teeth, has become an unlikely global player, and dirt-poor farmers in India have suddenly become a crucial link in the energy production of the United States. 

For centuries, farmers here used guar to feed their families and their cattle. There are better sources of nutrition, but few that grow in the Rajasthani desert, a land rich in culture but poor in rain. Broader commercial interest in guar first developed when food companies found that it absorbs water like a souped-up cornstarch, and a powdered form of the bean is now widely used to thicken ice cream and keep pastries crisp.

But much more important to farmers here was the recent discovery that guar could stiffen water so much that a mixture is able to carry sand sideways into wells drilled by horizontal fracturing, also known as fracking.

Guar farmers, traders and processors admitted fulfilling some long-held dreams with the profits they made last year. Some took trips to Europe; some bought gold; others got married (see related NY Times story "My Big Fat Guar Wedding")." 

3 Comments:

At 7/17/2012 3:02 PM, Blogger Jon Murphy said...

Capitalism: Helping people help themselves since 1776

 
At 7/17/2012 3:44 PM, Blogger Hell_Is_Like_Newark said...

Queue some leftist rant about how, "Now the poor's main food source is being taking away! Only to poison the water of the poor in America!"

Or something equally as silly.

BTW: PA just banned fracking in the Newark Basin. The Newark Basin was drilled in the 80's. Oil and gas was found, but the tech at the time didn't make it economical. The Newark basin extend from Eastern PA through a good portion of NJ. Imagine oil drilling in NJ!

More info here: http://pubs.usgs.gov/fs/2012/3075/fs2012-3075.pdf

 
At 7/17/2012 5:35 PM, Blogger VangelV said...

Great for the farmers. But when are the shale producers going to show positive cash flows and stable debt on their balance sheets? After all, the idea is for the shale investors to also make money.

 

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