The UK government has lifted its moratorium on shale gas fracking, but could shale gas ultimately be a bridge to nowhere?
The British Geological Society’s long-awaited upwardly revised UK shale gas resource estimates will be released in March. But for all the UK media hype, the case for shale gas as a bridging fuel that allows continued reliance on fossil fuels while reducing greenhouse gas emissions is looking increasingly forlorn.
Recent studies on “fugitive emissions” suggest that when it comes to climate change, shale gas is frequently no cleaner than coal. There is evidence that the financials don’t properly pan out, either. Sustained, low gas prices have made the cost-intensive extraction process financially unviable. In the US, shale gas schemes are paying out less than originally estimated.
The jury is still out on the controversial process of hydraulic fracturing of gas-rich shale. While 2D and 3D seismic surveys can reduce uncertainty and improve target-setting – and so increase the efficiency of the process – there is no doubting the impact of the actual fracturing shale process. This involves pumping millions of litres of fracking fluid (a blend of fresh water, proppants and chemicals) down a well bore at high pressure in order to fracture the shale rock and stimulate gas flow.
France and New York state in the US have maintained their respective fracking moratoriums amid fears of related seismic events and groundwater contamination. The UK’s moratorium, imposed following two minor earthquakes linked to independent energy firm Cuadrilla’s fracking operations near Blackpool in 2011, was lifted in December 2012.
If the US experience is anything to go by, exploiting the UK’s shale resource could leave the English countryside pockmarked with thousands of well pads. Shale gas’s opponents argue that rolling green landscapes of hedgerows and paddocks would be carved into a latticework of feeder roads for thousands of rumbling trucks ferrying heavy equipment to and from drill sites.
Each drill site would boast an array of vast storage tanks holding flowback or “brine”, the radioactive, chemical hangover of hydraulic fracturing. The fracking process itself, which requires anywhere from 7.5m to 38m litres of water to fracture a single well, places considerable strain on local water resources.
Trying to allay local fears, Cuadrilla says: “There is certainly a level of industrial activity, but … we are using low impact methods and technologies. We source our water through buried pipes, not trucks. We are looking into onsite water processing and re-use. We want to connect directly to the gas grid. We believe those who enjoy the rural aspect of Lancashire can benefit from this.”
The British Geological Survey’s (BGS) original estimates put the UK’s shale gas resource at 150bcm (billion cubic metres) – the equivalent to about 18 months of the UK's current gas consumption, or 15 years of LNG consumption. According to the UK’s Energy and Climate Change Committee (ECC), this is worth £28bn to the oil and gas industry and £9bn in tax revenues to the UK government.
The BGS is expected to upwardly revise this resource estimate considerably. Even so, Cuadrilla’s chief executive, Francis Egan, says that only 10% of the Bowland shale gas resource is likely to be recoverable. This highlights the crucial difference between a resource, which may or may not be economical to develop, and a reserve, the fraction of the resource considered commercially viable to develop.
Even if the UK’s proven shale reserves were at the top end of the BGS’s forthcoming estimate, whether shale gas can deliver low-carbon, low-cost supply security is unclear. The US Environmental Protection Agency (EPA) has recently revealed onshore natural gas and oil production to be the second-highest source of US greenhouse gas emissions. Emissions from shale oil and gas drilling, including fracking and leaks from transmission pipes, totalled 225m tonnes of carbon dioxide equivalents during 2011 according to EPA’s second annual greenhouse gas report.
EPA is late to the table publishing these figures; some academics have been pointing to the high carbon footprint of shale gas for several years. In 2011 a research team led by Prof Robert Howarth at Cornell University published a paper concluding that shale gas exploration resulted in a greenhouse gas footprint “considerably greater than that of coal or diesel oil, when the full effects of the methane emissions are considered”.
The paper asserted that during the weeks following hydraulic fracturing, frack-return liquids flow back to the surface, accompanied by large volumes of natural gas. “We estimated substantial methane venting to the atmosphere at this time, leading to a higher GHG footprint for shale gas than for conventional gas,” notes Howarth. An EPA document published in 2011 confirms 85% of flowback gas from unconventional wells is vented, with less than 15% flared or captured.
In a more recent paper, Tom Wigley, a senior research associate at the US National Centre for Atmospheric Research (NCAR), demonstrated that substituting gas for coal would result in increased rather than decreased global warming, due to leakage of methane during shale gas production. Wigley’s computer simulations indicated that a worldwide, partial shift from coal to natural gas would slightly accelerate climate change through to 2050, and to as late as 2140 if there were substantial methane leaks.
In 2012, the Massachusetts Institute of Technology’s Francis O’Sullivan and Sergey Paltsev similarly noted that fugitive emissions from the overall natural gas sector “are a proper concern”. However, they say flaring and reduced emission completions (RECs) can significantly reduce the levels of actual fugitive emissions from shale well completion operations.
The International Association of Oil and Gas Producer’s (OGP) explains that reduced emission completions, or “green completions”, separate and capture methane emitted during well completions and flowback. In April 2102, the US EPA introduced new regulations that require operators to conduct green completions. However, this new rule only comes into effect in 2015.
For its part, Cuadrilla says its operations are designed to monitor, capture, separate and contain the flowback gas, which it will then flare. The UK government has yet to establish regulatory oversight for this procedure.
Flicking a switch
How readily available is shale gas? The UK’s energy and climate change secretary Ed Davey said before unveiling the energy bill in November 2012, “some commentators seem to think you can just turn shale gas on”. The sobering fact is that thousands of wells must be drilled, only a handful of which will produce commercially, at considerable financial and environmental cost.
In 2011, US energy analyst Arthur Berman knocked the wind out of US reserve estimates when he published the results of studies of 9,100 of 15,000 shale gas wells in the US. By mathematically modelling the actual production of thousands of wells in the Barnett, Fayetteville, and Haynesville Shales, he demonstrated that the estimated ultimate recovery from individual wells was half of what operators had claimed, and that the average lifetime of a Barnett well could be as little as 12 years, instead of the 50 years initially suggested by operators.
Speaking to Ethical Corporation, Cuadrilla argues that it all boils down to the economics of recovery. “The economics need to be compared to other new sources, whether deep sea, arctic or tar sands. Of course, all these sources are more costly to recover than the ‘easy’ oil and gas from the 20th century, but that doesn’t mean it is uneconomic to do so.” The company adds that there are new ways of developing areas of the shale resource that are not sweet spots. “So the question is, what methods are there to cost effectively develop all kinds of shale, not just the easiest or best shale”.
Even so, when it comes to the UK shale gas, the UK’s Energy and Climate Change Committee chief executive David Kennedy recently reiterated the committee’s 2011 finding that UK shale gas is “unlikely to be a game changer”. Even at the most optimistic estimates, shale gas would only provide 10% of the UK’s current gas demand, he says, adding: “There may be enough shale gas to contribute to heating [Britain’s] homes but let’s be clear, it is not going to drive prices down and it is carbon intensive.”
The US state of New York’s now four-year moratorium on shale gas drilling could extend into 2014. Governor Andrew Cuomo missed a mid-February deadline for completing a report on the environmental impact of hydraulic fracturing that was to form the basis for new drilling rules.
Drilling in New York’s portion of the Marcellus shale deposit, one of the biggest in the US, was suspended in 2008 amid concerns that fracking could contaminate ground water reserves.
France has also vetoed fracking. The French president, François Hollande, revoked seven drilling licences in 2012 amid concerns over environmental impacts related to fracking. Industry minister Arnaud Montebourg says France isn’t prepared to tap its shale energy resources until “clean technologies” are invented to replace hydraulic fracturing.
French oil major Total’s chief executive, Christophe de Margerie, says Total is now considering investing in the development of shale gas in the UK, as the company’s home market remains off-limits to shale gas explorers.
Fracking’s legacy issues
Following a fracking operation, as much as 70% of fracking fluids can return to the surface as what’s termed “backflow”. Concerns have been raised over the presence of naturally occurring radioactive material (Norm) in backflow, which contains uranium, thorium, lead and radon.
Water from shale fracking can be many multiples more radioactive than usual surface background levels. Currently the flowback fluids are frequently stored in double skinned tanks on site pending disposal – which normally requires special permits due to the hazardous nature of the material.
Traditionally, final disposal methods for Norm waste have included spreading it on fields; leaving it in evaporation ponds (to leave a deadly legacy of contaminated soil and airborne radioactive particles); or discharging it into the near shore marine environment (a method still widely practised). More recently, companies began pumping the waste back into the ground and sealing it in abandoned wells, or injecting it into salt caverns.
Risks associated with Norm contamination were recognised in the mid-1980s. However, international and US federal regulations governing Norm treatment and disposal have yet to be introduced. As a result, innovation in Norm treatment processes has stagnated.Environment Fracking Rikki Stancich UK Government
April 2013, London
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