I just wanted to get something up on the blog since we talked about it today and I didn't know. Reinjection of produced water is definitely a big deal, according to two sources. The first talks about the Marcellus shale (in PA-NY, among others), where produced water contains a fair amount of radioactive material as well as chlorides and barium. He differentiates "injection wells" from "production wells," so maybe the produced water is injected into different wells nearby? The produced material is so nasty that it shouldn't even be exposed to the air: it should be sent right back down after the gas is extracted. If the water is cleaned, it can be reused in the next well, but that's expensive. The second source is more geared to the non-professional and gives more or less the same information: most produced water is indeed reinjected, because it's too expensive to clean it up enough to dispose of it in other ways. It also reminds us that fracking really uses a large amount of water.
Looks like I still have plenty to learn myself! I can't do economics without good awareness of the environmental science.