Monday

20th Jan 2020

Analysis

Public opinion stands in way of EU shale gas revolution

  • Oil and gas firms face a bumpy ride over shale gas (Photo: Jan Slangen)

If the oil and gas industry thought that a US-style shale gas revolution would seamlessly find its way across the Atlantic, it has had a rude awakening. Getting public support for fracking in Europe risks descending into a street-fight between industry and environmental NGOs.

The UK government has been particularly gung-ho in its attitude to shale gas drilling, offering generous tax incentives to companies for fracking.

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For their part, a number of drilling companies have promised that residents living near drilling sites will share in the profits, with plans to offer at least £100,000 (€116,000) to each community close to an exploratory well, of which there are likely to be thousands, together with a 1 percent cut of any profits if the well produces gas.

Prime Minister David Cameron and his finance minister George Osborne have become enthusiastic cheerleaders for natural gas drilling as they bid to be Europe's first country to emulate the US shale gas revolution.

Gas prices have more than halved, and hundreds of thousands of jobs have been created in America. Research carried out by The Economist estimates that the booming natural gas sector has added more than 1 percent to US GDP.

The north of England is also set to become the UK's first fracking hub, after a survey in June by the British Geological Survey estimated that 1,300 trillion cubic feet (tcf) of shale gas reserves lay beneath the rocks of Yorkshire and Lancashire.

Put into context, that is twice the estimated size of US reserves, while extracting just 10 percent of this would be enough to meet the gas needs of the UK for more than 40 years. For a country that currently imports 80 percent of its gas, this is serious stuff.

Meanwhile, a recent report published by the Institute of Directors, a leading, London-based think tank, estimated that investment in shale could peak at £3.7 billion a year, supporting 74,000 jobs.

A boom could also "generate significant tax revenue" for a government which is now eyeing up what it hopes could be an energy bonanza to rival the discovery of North Sea oil in the 1980s.

In an article for the Daily Telegraph earlier this month, Cameron could not have been clearer, warning opponents that "if we don't back this technology, we will miss a massive opportunity to help families with their bills and make our country more competitive."

But while you might expect a swell of public support for anything that promises to reduce utility bills, many are sceptical.

A survey by pollsters ICM found that 44 percent of Britons felt that the country should drill for shale gas. with 26 percent opposed.

However, when asked whether they would be comfortable with fracking near to their home, opinion was split down the middle - 40 percent opposed, 40 percent supportive and 20 percent undecided. In other words: don't frack in my back yard.

Earlier this month, anti-fracking campaigners chalked up a notable victory when Caudrilla announced that it was suspending plans to carry out drilling operations in Balcombe, on the English south coast, over fears that their site would be overrun by protestors.

If nothing else, the state of debate in the UK is a microcosm of why Europe is unlikely to see a shale gas boom comparable to that in the US.

For one thing, a number of EU countries, including the UK, are very densely populated. Drilling is therefore more intrusive for more people.

In contrast, well organised nimbyism, together with mobilised environmental campaign groups, are less of a factor in a country as large and with such a long history of oil and gas drilling as the US.

Moreover, environmental protection regulation is stricter across Europe than it is in the US. Nor is the regulatory framework as fragmented between local, state and federal level as in the states, where the industry also carries a lot of political lobbying muscle through candidate campaign contributions.

The process of fracking - or "hydraulic fracturing" - is probably the most controversial aspect of shale gas exploration.

Fracking involves the fracturing of various rock layers by a pressurized liquid using a well-bore hundreds of meters underground which allows natural gas to be extracted from the rock.

Critics argue that fracking causes earthquakes, pollutes the water supply and uses huge amounts of water. The NGO Food and Water watch told this website that up to 20 million gallons of water are used per well, of which between 25 and 75 percent comes back up to the surface.

To Kent Moors, Professor at Duquesne university in Pittsburgh, Pennsylvania, one of the main hubs of the US natural gas industry, shale gas extraction doesn't have to be a zero-sum game of serious environmental degradation in exchange for lower gas prices.

"If we get to a point where we have to decide whether to provide clean water for our children or stay warm then we've already lost," he told this website, adding that "if companies can't solve the adverse environmental impacts then they shouldn't be drilling."

It seems clear that the oil and gas industry in Europe is going to have to do a lot more work to convince public opinion than its US counterparts.

In particular, they need to calm fears about the chemicals used in the fracking process and the waste water that is left behind. One big step they could take would be to reduce or eliminate entirely the use of dangerous chemicals, such as Glutaraldehyde, Petroleum Distillate and Ethylene Glycol, which often contain cancer causing agents.

For the moment, it is uncertain whether a middle ground can be found in a debate which risks become polarised between drill-happy industry enthusiasts and environmental campaigners who want a flat-out ban on fracking and on developing any new means of energy production that is not renewable.

But it increasingly clear that - to Europeans, at least - advocates of shale gas extraction need to do more to assuage public fears that fracking will not cause long-term environmental damage.

Without public support, the gas will stay underground.

Opinion

We need an honest debate on shale gas

The debate on shale gas is reaching hysterical proportions. It is high time to have a frank, open and honest debate that acknowledges both the merits and drawbacks of shale gas, writes Roderick Kefferpütz.

EU ditches plan to regulate on shale gas

The EU commission has backed away from regulating shale gas extraction, leaving national governments in charge on the controversial practice.

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