Douglas Arent,
Joint Institute for Strategic Energy Analysis, National Renewable Energy Laboratory
Nebojsa Nakicenovic,
International Institute for Applied Systems Analysis
Key Messages:

Resource estimates of unconventional natural gas have increased significantly over the past decade due to advances in hydraulic fracturing and drilling techniques
.
 Increased U.S. production and initial (large) global estimates have spurred interest in increasing the scientific knowledge of the production, distribution, and use of natural gas, particularly in relation to environmental issues including climate change.
 Considerable attention has been paid to practices associated with methane emissions and water for fracing. Numerous national and subnational jurisdictions have expressed concerns or implemented moratoria on natural gas production, while production continues to grow in areas where allowed.
 Multiple studies have addressed responsible development practices and the importance of reducing associated emissions in relation to climate mitigation, as well as local air pollution. The development and use of unconventional natural gas entails risks relating to water and land use, methane emissions, cleaner technology deployment delays, overreliance on single fuels, and social acceptance
.
 If unconventional natural gas is produced using appropriate best practices
, transported and distributed with little leakage, and incorporated into integrated energy systems that are designed for future resiliency, it can likely play a significant role in realizing a more sustainable energy future.
 Natural gas can help reduce greenhouse gas (GHG) emissions, but in the absence of targeted climate policy measures, it will not substantially alter the trajectory of global
GHG concentrations.
 Natural gas can be a complement to other low carbon technologies, particularly renewables, and can help reduce the potential costs and challenges for large scale carbon capture and storage implementation compared to coal-based solutions.

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The United States has experienced an unprecedented “revolution” in unconventional natural gas production over the past few years. Greater supply and lower prices have spurred increased use in the power sectors and plans for multiple new industrial facilities, including exports. The U.S. experience, however, is being closely monitored by many other jurisdictions with respect to a variety of issues ranging from technology developments to the social license to operate (see e.g.,
Bazilian et al. 2013a; Bazilian et al. 2013b, IEA 2011).
Additionally, despite the fact that most of the activity to date has occurred in North America, there are numerous countries that likely have significant shale resource assessments. The United
States is typically listed as 4 th behind China, Argentina and Algeria (EIA 2014).
Table 1 provides a snapshot of the rapid, very recent change in assessments of technically recoverable shale gas and oil resources globally according to studies commissioned by the U.S.
Energy Information Administration (EIA). Although assessments are fraught with uncertainty, it is useful to recognize the potential enormity of the resources as this highlights the scale of the economic impacts and environmental pressures that may manifest. It is also important to note that the assessments referenced in Table 1 do not include several regions – Russia and the
Middle East, for example – where there is a history of considerable natural gas and crude oil production from conventional resource basins. Technical resource estimates may continue to increase, but commercial viability of shale resources is distinct from technical viability. One can think of commercially recoverable resources as a subset of technically recoverable resources, as the former considers both technology and economic factors whereas the latter only considers technology. Indeed, there may be factors why much of the resource that is assessed to be technically recoverable will never actually be developed
, and are likely to change in complexity and importance over time (Medlock 2014).
Table 1: Global Shale Oil and Gas Resources (EIA 2013a – updated June 13, 2013)
Environmental stewardship is central to the long term success of the industry (Arthur et al. 2008;
Zoback et al. 2010; Schmidt 2011; Finkel 2011; Finkel 2013; Moniz et al. 2011; Brasier et al.
2011; Sakmar 2011; Bamberger 2012). Regulation of shale gas development to mitigate environmental impacts has been increasing at all levels of governance. Stakeholders representing a broad cross-section of society, including many local and regional groups, are seeking greater transparency of and more involvement in shale gas development decisions (Logan et al. 2012,
Krupnick et al. 2014, Krupnick and Kopp 2014). This has resulted in local and state-wide ballot initiaitves, legislative activity, new regulations, and litigation (CNEE 2013).
2

The concerns over environmental impacts of shale development, as well as potential implications for climate change, are not restricted to the United States. For example, the European Parliament
(2011) study of health and environmental impacts considered a wide variety of issues, including: impacts on landscape, air pollution, greenhouse gas emissions, surface and ground water, seismicity, chemicals and radioactivity, long-term ecological impacts, and resource consumption.
Related to environmental impacts, it found that:
 Unavoidable impacts are local land use due to drilling pads, parking and maneuvering areas for trucks, equipment, gas processing and transporting facilities as well as access roads.

Potential major impacts are emissions of air pollutants and GHGs, and groundwater contamination. The latter could arise from uncontrolled gas or fluid flows due to blowouts or spills, leaking fracturing fluid, and uncontrolled waste water discharge
.
 Many fracturing fluids contain hazardous substances, and flow-back fluid can contain heavy metals and radioactive materials natural to the deposit.

Accidents happen, and they can be harmful to the environment and to human health.
Recorded violations of legal requirements amount to about 1-2 percent of all drilling permits. Many violations and accidents are due to improper handling or leaking equipment
.
 Groundwater contamination has been reported in the vicinity of gas wells; in extreme cases, methane can lead to hazardous conditions in residential buildings
.
 The impacts can add up as drilling density increases (up to six well pads per km²).
The full environmental impacts of shale gas development are not yet understood, particularly as practices continue to evolve rapidly. The rapid shale gas development in the United States has raised considerable attention to local environmental issues, GHG related emissions and water and other above ground issues, including public health and impact on communities. Other countries and regions have also expressed considerable interest in implications for energy security, infrastructure development, impacts on other energy resource development and use, and economic and manufacturing competitiveness.
3

Zoback and Arent (2014) provide a general framework of the environmental risk factors for shale development (Figure 1). These include air and emissions, water use and potential contamination, land and ecosystem impacts, and community concerns including induced seismicity and noise .
Figure 1: Risk factors for shale development (Zoback and Arent 2014)
Seismicity is a contentious issue in the management of fracing projects and is associated with waste water disposal
. The topic of man-made earthquakes has become a key issue in the social license to operate debate, as have issues of land degradation and local pollution from trucks and site-related development. Below, we highlight water and GHG concerns in more detail.
2.1
Water
A comprehensive and objective understanding of water resource risks and risk management in the production and processing of natural gas can support sound decision-making. All phases of shale gas development have the potential to affect either the quantity or quality of local water resources (Horner et al. 2011; Vidic et al. 2013). Figure 2 illustrates the variety of risks shale gas development could pose for local water resources. Our current understanding of water-related risks and risk mitigation techniques in shale gas development leaves important questions unanswered. As a result, conflicting messages have been relayed to industry practitioners.
4

Figure 2: Overview of risks to water resources throughout various phases of shale gas development (Logan et al. 2012).
To mitigate risks, various attempts have been made to define best practices for water management (e.g., IEA 2012a; Energy Institute 2012; ASRPG 2012; Chief O&G 2012; SEAB
2011; API 2010). As shown in Table 2, quantity-related risks can be mitigated by recycling wastewaters from the fracing process or by using other, non-fresh sources of water. In many cases, water risk management practices might be more appropriate or cost-effective for certain geochemical conditions than others. For example, recycling wastewaters in certain areas might be more challenging due to high concentrations of impurities.
Table 2: Selected Recommendations from Secretary’s Energy Advisory Board (SEAB 2011)
Comprehensive analyses of water risks are hindered by a lack of reliable, publicly available data.
Data are not publicly available for many regions for total water withdrawals, total wells drilled, water recycling techniques, wastewater management, and other management practices. There are no international, national, or state-level disclosure initiatives to track or evaluate the success of best management practice implementation. For example, because operators are not required to report this information, it is difficult to determine how many operators are currently employing
(and with what success) closed-loop drilling practices and other best management practices.
Voluntary reporting approaches have been established in many jurisdictions.
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2.2
Emissions
A comprehensive and objective understanding of GHG emissions from the production, processing, and transport of natural gas is vital to understanding the potential role of natural gas in mitigating climate change. The GHG impacts of natural gas—particularly in comparison with coal, but also in comparison with diesel and gasoline for many markets—affect decisions on future energy sector developments; industrial practices; and regulatory, policy, and sectoral applications.
The peer reviewed scientific literature fairly consistently indicates a significant difference in emissions from natural gas processing, transmission, and distribution compared to official inventories (Brandt et al. 2014 and references therein, Jackson et al. 2014, Phillips et al. 2013).
U.S. atmospheric studies indicate that leakages of methane and other toxic gases are 25%-75% higher than official inventories (Brandt 2014). Higher emissions are likely due to numerous factors including old (and leaky) pipelines and components throughout the natural gas system.
However, production via hydrofracing is likely not a major source of emissions (Brandt 2014).
The impact of natural gas on CO
2
emissions relative to other fossil fuels depends on the overall leakage rate. Alvarez et al. (2012) have calculated the maximum leakage rate for natural gas to provide climate benefit, over all time scales, compared to the fuel it would displace. Their results suggest that maximum leakage rates differ significantly depending on the application. Emissions could be as high as 3.2% for benefits to be realized in the electric sector displacing coal, but only as high as 1.2% for beneficial use in the transportation sector. Preliminary emissions estimates based on atmospheric research suggest that current leakage rates could be significantly higher than these tipping points (Tollefson 2013, Brandt 2014).
The increased attention to methane emissions has risen due to a combination of factors including new literature, increased U.S. production, and the potential for more widespread production.
The IPCC also placed a spotlight on methane emissions and climate mitigation when it updated the 25- and 100-year global warming potentials of methane from 84 to 86, and from 28 to 34, respectively (Myhre et al.
2013).
1
1 The Global Warming Potential (GWP) is defined as the time-integrated radiative forcing due to a pulse emission of a given component, relative to a pulse emission of an equal mass of CO
2
. The updated values include carbon-climate feedbacks.
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Despite the new-found abundance of natural gas, many policymakers and investors not only question the benefits of natural gas, but also retain concerns over natural gas prices and volatility. For many, ensuring balanced and risk-appropriate energy development and use may be a key challenge going forward. Major findings from the literature include:
 Natural gas will likely not substantially change global GHG concentrations without additional climate policies (Newell and Raimi 2014; EMF26 2013; McJeon et al. 2014;
EIA 2011).
 Lower gas prices will likely result in an energy-economy feedback effect; that is, lower gas prices increase overall economic activity. This in turn increases demands for all energy forms, including fossil fuels (Newell and Raimi 2014; EMF26 2013; McJeon et al. 2014; EIA 2011).
 To the extent that abundant gas occurs locally, changes in GHG emissions in one region can have consequences for emissions in another region. For example, natural gas displacement of coal in the United States over the past five years may have contributed to an increase in coal use in Europe
(IEA 2012b).
 Similarly the displacement of coal by gas increases radiative forcing through the reduction in sulfur aerosol emission, while conferring a local air quality benefit (McJeon et al. 2014; Newell and Raimi 2014).
The use of natural gas as part of a sustainable energy future is also often discussed in terms of its relationship with renewable energy as well as other power sector options. The Global Energy
Assessment (GEA 2012) and others (see e.g., Lee et al. 2012) find that natural gas, if produced, transported, and used responsibly, can be an important portfolio component and provide a robust platform for a sustainable future. Natural gas has been discussed as a bridge fuel between carbon-intensive fuels and renewables (Podesta and Wirth 2009; Lopez 2014); however it should be recognized that, as Newell reports “Our main conclusions are that natural gas can help reduce
GHG emissions, but in the absence of targeted climate policy measures, it will not substantially change the course of global GHG concentrations” (Newell and Raimi 2014).
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