The Fracking Great Debate
Thursday 22nd May, Newcastle
Question
Should we exploit the UK's onshore
shale gas, and if so under what
conditions?
Background
What is shale gas?
source: British Geological Survey
Shale gas is a form of ‘unconventional
gas’ which is extracted from shale
rock formations, usually located at
depths of 1000 – 4000 metres. Shale
is a type of rock that is not very
permeable, which means that fluids
and gases do not naturally flow into a
bored well. ‘Unconventional’ refers to
how the gas is extracted as a result of
this impermeability. (19)
Shale gas is mostly composed of methane. Methane is ‘natural gas’ and is the gas used to generate
electricity and for domestic heating and cooking.
How is shale gas extracted?
Via a well, as with conventional gas. This is drilled vertically into the shale, then the drill is steered
until it is horizontal and drilling continues. The reservoirs are wider than they are tall, so horizontal
drilling accesses more of the gas. To allow the gas to flow, fractures have to be created in the rock.
This is done by hydraulic fracturing (hence ‘fracking’). Fluid (99 - 99.5% water and sand, 0.5 - 1%
chemicals) is injected down the well and into the shale gas rocks at high pressure. The sand props
open the new fractures allowing the gas to flow into the well and be collected at the surface. (19)
A health warning about the rest of this briefing
There is a lot of speculation about the economics, environmental impact etc. of fracking in the UK.
This is because we haven’t tried fracking for shale gas yet and because we can’t assume that what
happened elsewhere will happen here. The most authoritative information seems to be a report by
the Royal Society and the Royal Academy of Engineering in 2012, called ‘Shale gas extraction in the
UK’. Anything below, quoted from that report is marked ‘(RS/RAE report)’. Other sources are
indicated by numbers – just ask the organisers if you want to know what these are.
1
How much shale gas is there?
Globally, shale gas could increase natural gas resources by approximately 40%. (RS/RAE report)
Turning to the UK, in 2013 the BGS released an estimate for shale gas in a particularly promising area
between Wrexham and Blackpool in the west, and Nottingham and Scarborough in the east. The
central estimate is 1300 trillion cubic feet (tcf), with a range from 800 to 2300 tcf.
Only some of this gas can be recovered. Estimates range from 4 - 20%. The central estimate above
might therefore produce 50 – 260 tcf. To put this into context, the UK’s remaining potentially
recoverable conventional gas resources are 50 tcf, annual UK gas consumption is 2.7 tcf and we
import 1.8 tcf each year.
How much water does it use?
The amount needed to operate a hydraulically fractured shale gas well for a decade may be
equivalent to the amount needed to water a golf course for a month; the amount needed to run a
1,000 MW coal-fired power plant for 12 hours; and the amount lost to leaks in United Utilities’
region in north west England every hour. (RS/RAE report)
Seismicity [how often and how big are earthquakes and tremors]
There is an emerging consensus that the magnitude of seismicity induced by hydraulic fracturing
would be no greater than 3 ML (felt by few people and resulting in negligible, if any, surface
impacts). Vibrations from a seismic event of magnitude 2.5 ML are broadly equivalent to the general
traffic, industrial and other noise experienced daily. Recent seismicity induced by hydraulic
fracturing in the UK [near Blackpool in 2011] was of magnitude 2.3 ML and 1.5 ML (unlikely to be felt
by anyone). (RS/RAE report) [‘ML’ stands for ‘local magnitude’]
Water pollution
Concerns have been raised about the risk of fractures propagating from shale formations to reach
overlying aquifers [underground rock containing water]. The available evidence indicates that this
risk is very low provided that shale gas extraction takes place at depths of many hundreds of metres
or several kilometres. Geological mechanisms constrain the distances that fractures may propagate
vertically. Even if communication with overlying aquifers were possible, suitable pressure conditions
would still be necessary for contaminants to flow through fractures. More likely causes of possible
environmental contamination include faulty wells, and leaks and spills associated with surface
operations. Neither cause is unique to shale gas. Both are common to all oil and gas wells and
extractive activities. (RS/RAE report)
A US Environmental Protection Agency (EPA) study reported that hydraulic fracturing
had contaminated groundwater and drinking water supplies in Pavillion, Wyoming. The well casing
was poorly constructed, and the shale formations that were fractured were as shallow as 372m.
Many claims of contaminated water wells due to shale gas extraction have been made. None has
shown evidence of chemicals found in hydraulic fracturing fluids. (RS/RAE report)
2
What happened in the US?
From a standing start a decade ago, it now gets more than a quarter of its natural gas from shale.
Production is so cheap there that shale gas is replacing coal in power stations; and as a result its
carbon dioxide emissions are the lowest since 1992. Low energy prices are even encouraging the
manufacturing of some goods to return from China. (5)
Shale gas now supports a million jobs, produces nearly $50 billion in tax revenue and halves the cost
of energy for businesses and people. It has revived manufacturing industry, taken market share from
coal, cut energy imports and promises to revolutionise transport, as buses and trucks shift to using
cheaper, cleaner methane instead of petrol. (21)
UK experience with fracking
The UK has experience of hydraulic fracturing and directional drilling for non-shale gas applications.
Over the last 30 years, more than 2,000 wells have been drilled onshore in the UK, approximately
200 (10%) of which have been hydraulically fractured to enhance recovery. The combination of
hydraulic fracturing and directional drilling allowed the development of Wytch Farm field in Dorset
in 1979. [This] is Europe’s largest onshore oil field. Over 200 wells have been drilled. [This approach
has allowed] oil to be produced beneath the Sandbanks estate, Bournemouth, from oil reservoirs
10km away. (RS/RAE report)
Will it create jobs?
Estimates range from 16,000 – 64,000 new jobs. Only a small proportion will be directly employed in
fracking. The rest will be jobs with suppliers etc. (20)
Will it reduce energy prices?
There seems to be general agreement that it won’t, or that any reduction in prices will only be small,
up to 4%. This is because UK shale gas will be sold on the European market, and there won’t be
enough of it to affect the price much.
Who regulates shale gas in the UK?
A number of bodies are involved. The main ones are:
 The Department for Energy and Climate Change awards licenses to operators, who then
need a number of other permissions and permits, depending on their activities.
 The Environment Agency (EA) monitors the environmental impacts of fracking.
 The Health and Safety Executive (HSE) monitors site safety and well integrity. ‘Well integrity’
means avoiding the uncontrolled release of gas and fluid.
 Local authorities decide on planning permission
What about other countries?
There are full or partial bans and moratoriums in, among other countries, France, Bulgaria, the Czech
Republic, Austria, Ireland, Spain and Germany. (10)
3
Option
A: Not in any circumstances
What people in favour of this option argue
The gas must be left in the ground and we must focus on:
 renewables
 reducing the demand for energy
 using it more efficiently
What the RS/RAE report says
Shale gas is championed by some commentators as a ‘transition fuel’ in the move towards a low
carbon economy, helping to displace higher-emitting fuels, such as coal. Others argue that shale gas
could supplement rather than displace coal use, further locking in countries to a fossil fuel economy.
The development of shale gas could also reduce and/or delay the incentive to invest in zero- and
low-carbon technologies and renewable energy.
Main arguments for this option
Opting for a new "dash for gas", as the chancellor George Osborne wants [with up to 40 new gasfired power stations] will lock the UK into a high-carbon future, as any new gas-fired power stations
built in the next few years will still be operating in the 2040s, by which time fossil fuels should have
been almost entirely phased out for electricity generation. (9)
We know that we have to leave 60-80% of our known fossil fuel reserves in the ground if we're to
avoid catastrophic climate change. We shouldn't be looking for more, or building up a new industry
with huge capital investment adding to the carbon bubble.
Coal use has halved 1990-2013 so the UK is already halfway along deploying this "bridge technology"
and as yet with no need for any assistance from any fracking. In fact, fracking has had the opposite
effect as it is the flooding of US markets with fracked gas that caused coal prices to slump
worldwide, the resulting cheap coal reversing the decline of UK coal use. (13)
Other points
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There is a danger that shale gas will ‘muscle out’ low carbon fuels. (20)
We’d get more jobs from switching investment from shale gas to renewables.
The best way to produce energy security is to promote efficiency in the use of energy and
renewables.
If we don’t import a certain amount of gas, because we are producing our own, it will be
burnt by someone else, increasing total emissions. (20)
All the lessons from the US are that fracking divides communities and sets people and
groups against each other. Folk tend to be strongly for or against the process and the influx
of fracking money into communities creates new tensions. (11)
4
Option
B: Only if there is a full range of effective regulation
What the RS/RAE report says
The health, safety and environmental risks associated with hydraulic fracturing (often termed
‘fracking’) as a means to extract shale gas can be managed effectively in the UK as long as
operational best practices are implemented and enforced through regulation. Hydraulic fracturing is
an established technology that has been used in the oil and gas industries for many decades. The UK
has 60 years’ experience of regulating onshore and offshore oil and gas industries.
Likely causes of possible environmental contamination include faulty wells, and leaks and spills
associated with surface operations. Neither cause is unique to shale gas. Both are common to
all oil and gas wells and extractive activities. Ensuring well integrity must remain the highest
priority to prevent contamination. The probability of well failure is low for a single well if it is
designed, constructed and abandoned according to best practice. The UK’s well examination scheme
was set up so that the design of offshore wells could be reviewed by independent, specialist experts.
This scheme must be made fit for purpose for onshore activities.
Other points about the regulatory system
This adaptation is starting to happen. The Environment Agency has set up a shale gas unit. The EA
and the HSE reckon that they have the capacity to regulate the exploration stage of shale gas and
have given it priority. The government is doing research on how to monitor emissions. (20)
Regulation will be tougher than in the United States. Examples are:
 In the US, companies do not usually have to disclose what chemicals they are using in their
fracking liquid. In the UK they will.
 In the US, waste water can be stored in ponds, from which gases can evaporate. In the UK,
storage will have to be in closed tanks, with the tanks monitored. (20)
 The UK, unlike the US, will have a system of independent well examination, with checks on
the design and construction of wells, overseen by the Health and Safety Executive.
Local authorities take account of factors like noise when deciding whether to give planning
permission.
If we produce more energy locally, we can produce it in safer conditions than might be possible in
countries with weaker regulation. (16)
What criticisms of the UK system of regulation are there?
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Regulation can make fracking safer, but it cannot make it safe. On average, around the
world, about 5% of wells leak – although the UK should be able to do better than this. (20)
There is use of non-binding industry guidelines
The government is keen on shale gas, so regulators are under political pressure to say yes
There have been cuts at both the Environment Agency and at councils, which will make it
harder for them to do their jobs. (20)
An article in the New Statesman quoted an engineer as saying, “If you know no one is
checking – and with fracking we do know no-one is checking – the temptation to cut costs is
too big to resist.”
5
Option
C: Only as part of a sensible climate change strategy
What people who support this option believe:
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Climate change is a serious problem – perhaps the most serious
Shale gas will – or can be made to - substitute for coal
Investment in shale gas will not crowd out (take the place of) investment in renewables, or
can be made not to. One idea to ensure this is for the government to use some of the tax
revenue from shale gas for a large research and development programme for renewables.
We can reduce emission from gas-fired power stations by using CCS (carbon capture and
storage)
Arguments made in favour of this option
Shale gas, carefully regulated and monitored, is generally reckoned to produce around half the
carbon emissions of coal, although there are of course arguments about this.
According to David Mackay, chief scientific adviser to the Department of Energy and Climate Change:
the principal effect of UK shale gas production and use will be that it displaces imported LNG, or
possibly piped gas from outside Europe. The net effect on total UK GHG [greenhouse gas] emissions
rates is likely to be small. (26)
Shale gas – if properly regulated to protect local environments – can prevent the runaway growth in
carbon dioxide emissions – seen especially in the developing world – and break the link between
economic growth and climate change. Coal, the dirtiest fossil fuel, has seen its share of world energy
supply rise from 25% to 30% in the last five years. In a world where most people choose the
cheapest source of energy, gas (whose emissions are roughly half that of coal) is the only serious
pretender to King Coal. While renewable technologies are scaled up and priced down, shale gas is a
vital "bridging technology" that can reduce our emissions over the next couple of decades –
something all agree is essential to meet long-term climate targets like limiting global warming to two
degrees. (5)
Britain's dependency on coal is now at 38% and rising. Global coal consumption is at its highest level
since 2006, and mocks all attempts at emissions discipline. After Japan's Fukushima disaster in 2011,
in which no one died, Germany was so panicked that it closed all its nuclear sites. This in turn meant
frantic investment in German coal and lignite – 10 new plants are said to be opening – and a surge in
Polish coal output. Germany's carbon emissions are rising by between 5% and 7% a year. (22)
The Chinese used 1.5bn tonnes of [coal] in 2000, and now use more than 4bn. This utterly swamps
any western attempt at mitigation. The death rate among Chinese miners may be down from about
6,000 a year at the turn of the century, but is still beyond 1,000 a year. Gas is a carbon-based source
of energy but can be twice or three times less polluting than coal – and does not require hundreds of
people to die each year extracting it. The "dash for gas" has made America the only big country to
actually reduce emissions since Kyoto. (22)
83% of our homes are heated by gas. It will be a long time before renewables will reduce this. So we
need to carry on using gas – whether shale gas or conventional. (20)
6
Option
D: Only if the public want it and it is clearly for the public good
What people think at present
Opinion polls show that more people are in favour of shale gas than are against. Polls for the
University of Nottingham, however, show the gap between Yeses and Nos halving between 2013
and 2014. The under 25s are currently the only age group not in favour - Yeses and Nos are equal.
Women are more hostile to fracking than men. Most people are against fracking in their area. (20)
Plans to allow fracking companies to drill deep under people’s homes without residents’ permission
are opposed by three-quarters of the British public, according to a new poll from Yougov. The
proposals are expected to be in next month’s Queen’s Speech. (14)
The social licence to operate
Member companies of the UK Onshore Operators Group (UKOOG) have signed up to a Community
Engagement Charter, which pledges “openness and transparency in everything we do”. It also
recognises the need for “a social licence to operate”, a phrase first used by Andrew Austin, the chief
executive of IGas, in evidence to the House of Lords economic affairs committee. He said:
“Anywhere we choose to drill or would look to drill would have to be with the acquiescence of the
local community and in working with it. Frankly, if you do not have the social licence to operate with
the acquiescence of the people you are with … that is going to be the constraint.” (23)
How much will communities get?
The Community Engagement Charter says that operators will:
 Engage with individuals and organisations in the local communities from an early stage
 Provide benefits to local communities at the exploration/appraisal stage of £100,000 per
well site where hydraulic fracturing takes place
 Provide a share of proceeds at production stage of 1% of revenues, allocated approximately
2/3rd to the local community and 1/3rd at the county level [that is, to the county council]
Councils will also be allowed to keep all the business rates from a site. This could be worth £1.7m a
year for each site. (24)
People in favour of this option might want:
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More money for communities. The Local Government Association says that communities
should have a legal right to 10% of revenues.
A fair process for allocating the money from shale gas that will come to communities
The UK government to use tax receipts to create a sovereign wealth fund. Norway and
Shetland did this with their oil revenues.
Compensation for economic damage, for instance to agriculture, tourism or property prices
7
Option
E: Yes, with sensible regulation that balances the needs of industry and local communities
People who support this option do so for two main reasons:
1. Energy security
As the Background states, we import two-thirds of our gas. Some comes through pipeline, mainly
from Norway. Some is imported, especially from Qatar. This is frozen to 1/600th of its size and
shipped in the form of liquefied natural gas (LNG). Without shale gas, as we produce less of our own
conventional gas, we will have to import more, probably from more places.
Britain is courting Azerbaijan, Kazakhstan and Turkmenistan in the same region, Qatar in the Middle
East and Algeria in North Africa. Along with Russia, these nations are existing or future big-six gas
providers to Britain, and yet all have troubling questions to answer on human rights. (17)
Shale gas could provide security of price as well as supply. It would have protected us against the
spike in the price at the time of the Japanese nuclear accident. (20) The chemical industry in the UK
worries that the higher price of gas here, compared to the US, is making it less competitive.
2. Benefits to the economy
As well as the job creation covered in the background, one report said that £33 billion would be
invested in the supply chain for shale gas in the UK over 18 years. (25)
Regulation
A House of Lords committee found that since the lifting of a moratorium on hydraulic fracturing in
2012, the Environment Agency has not received or approved a single application for the permits
necessary for exploratory drilling. The report calls for a simplified and clear regulatory regime to
encourage development of shale and reassure communities that risks of harm to the environment or
human health are low. The Committee express concern that complex regulation may be causing
unnecessary delays. (27)
Councils are very cautious in giving planning permission because they are afraid of judicial review
(where a judge reviews the lawfulness of a decision or action made by a public body). Central
government should give them more support. (20)
Other points made in favour of this option:
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It isn’t shale gas or renewables. It’s both.
Shale gas may well have lower carbon emissions than imported conventional gas, because of
the emissions related to transporting and liquefying imported gas.
Nuclear power is inflexible and renewables are intermittent. Gas is flexible and constant.
Environmental activists often quote the film Gaslands, which shows flames coming out of
household taps. But this appears to have been caused by naturally occurring methane. (20)
You can already do things like put cables under people’s houses without their permission. It
would be consistent with this to allow companies to frack 2 -3km under those houses.
IGas already operate 100 (non-fracking) sites in the UK. Each site is five acres. The total of
500 acres takes up less land than the car parks at Meadowhall or the Trafford Centre. (20)
As North Sea oil and gas production falls, staff can switch to producing shale gas. (20)
8