The dog in the sinkhole and other controversies of shale gas

If people know much about shale gas in Europe, they know there has been environmental damage in the US significant enough for shale gas to be described in the press, and thus perceived by both policy makers and the investment community as being inherently “controversial”.

What is the exact reality of the damage?  I’ve pointed out on several occasions that we are long on anecdote but lacking in data. On the anecdote front the up to the minute Pennsylvania Alliance for Clean Water and Air List of the Harmed consists of 1123 cases of ‘harm’ several of which are, trying to be polite, somewhat tenuous:

Symptoms: Constant fatigue, headaches, nausea, fatigue and dizziness

Symptoms (animal): Lost cows to toxic oil and gas waste; testing of sick cattle from the area by the Texas Veterinary Medical Diagnostic Laboratory in 2005 found petroleum in the hair of 54 out of 56 cows

Symptoms: Weakness, dizziness, fainting, nausea, pain, burning skin and breathing difficulty; four of her grandchildren, who live on the same property, have asthma

Symptoms (animal): Dog has asthma

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What’s More Dangerous – Puppies or Fracking?

Here’s another guest post from one of our far flung correspondents and co-conspirators in the shale revolution at No Hot Air, Allen Gilmer, CEO of Drilling Info. This was originally posted at The Wireline Blog at info.drillinginfo.com

What’s More Dangerous – Puppies or Fracking?

Humans have a tough time quantifying risk or perceiving proportionality. We tend to overstate some risks while ignoring others based upon a variety of factors…things like “what scares us”, “what motivates us” and “what we DON’T know we don’t know”.

Another reality is that our emotions are largely fed by fear. We tend to act more quickly and instinctively to fear or pain. A person holding his or her hand over a flame will move it away quickly to avoid pain, far faster than someone seeking to touch a fine leather or satin. People trying to sell us stuff know this. Not just people selling us goods and services, but ideals and values. In America, selling ideals and values is a pretty big business in itself…tens of billions of dollars per year. Although fear clearly sells, it rarely buys us something we really want to own. There is no real joy in the state of NOT burning your hand…you just avoid the pain.

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Actual CO2 reductions. Not Hot Air.

I should be the last one to tell the WWF UK, Friends of the Earth -UK and Greenpeace UK, but they need not only to stop fighting gas but to start thinking globally. The Doha Climate round is ending this week and what has it accomplished? As little as the rest of the Kyoto Process. Insanity is repeating the same actions and expecting a different result, just as they have in the last 18 conferences.

Increasingly the main objection the UK arms of the Green NGO's can muster against shale gas is that we won't meet the Committee on Climate Change targets for either percentage of electricity from renewable sources or a longer term 80% decarbonisation of the electricity and heat sectors by 2050.The GNGO's  need to ask themselves what is truly important ?  Climate Change or the Committee on Climate Change?  They are losing sight of the results gas can achieve in cutting huge swathes of carbon on a global basis From that we no longer need such high targets in the UK.  It doesn't mean John Gummer is a bad person. It just simply means that reality has changed.  Sadly, the obsession with local targets to solve a global problem solves nothing. 

Nothing illustrates this more than a chart published this week from the US Energy Information Administration. The US didn't sign the Kyoto Accords  Yet, thanks primarily to natural gas but also due to significant efficiency improvements in transport, the US is exceeding the targets it would have been given:

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The no European Shale Gas service industry myth

In the library on the left you can see reports from 2010 by Stephens of Chatham House or Geny of OIES predicting the impact of European shale gas will be constrained by a lack of service industry. Write one report from name brand conventional wisdom, and it gets cited by others which explains why this year's Pøyry Report for Ofgem repeated the same rationale. A key reason the conventional wisdom can't quite get shale is the speed with which it can change. Energy 'experts' treated the field as a dusty academic subject.One could safely write a paper citing another from twenty yearsbefore. One could be equally secure in using the same outline for an undergrad course in 1998 or 2008: very little if anything would have needed to change. But two years is a long time in shale.

I have always thought of the lack of a European Service industry was always a bit of a red herring. This is Florence Geny on the subject 

The service sector in the US was very responsive to a surge in demand for drilling and fraccing services, thanks to intense competition and an entrepreneurial spirit. However thesituation is different in Europe. Competition in the service sector, dominated by four international service companies (Schlumberger, Halliburton, Weatherford and Baker Hughes)and containing few local specialised manufacturers and service providers, is limited.Therefore, incentives for investing in the construction of new rigs, and at a competitive price,are far more limited than in the US. This situation may delay the development phase if there is high demand from operators.

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