Fracking in National Parks
On 26 January, MPs voted down a proposal to ban fracking in the UK after the Government conceded to Labour party demands for additional controls to be included in the Infrastructure Bill. Earlier this week, in the House of Lords, the Labour amendments were modified, and the Bill gained Royal Assent. One of the changes reversed a ban on fracking in National Parks and Areas of Outstanding Natural Beauty – which, although proving unpopular with shale gas opponents, is a sensible change.
A blanket ban on fracking in National Parks or Areas of Outstanding Natural Beauty (AONB) was a fundamentally flawed concept. In essence, the notion of such a ban raised a legitimate question: “If it can’t be done safely there, why should we accept it can be done safely elsewhere?”
But it was never the safety of fracking that was at the root of this proposed ban: it was a genuine concern for the landscape and amenity value of these areas, which attract thousands of visitors every year. People were concerned that construction traffic, the sight of drilling rigs and the potential for noise, would upset the character of the countryside.
To find out whether these concerns are valid or not, we simply need to look for evidence of existing industrial activities being conducted in National Parks and AONB.
Test drilling in the North Pennines
In the last two years, the UK subsidiary of Canadian mining company Minco plc has drilled a total of thirty 500 metre deep boreholes in the North Pennines between Allenheads, near Stanhope, and Nenthead in Cumbria. In 2013, the area celebrated 25 years as an AONB, and yet the company has been able to quietly get on with its search for zinc deposits.
Speaking in 2013, Chris Woodley-Stewart, director of the North Pennines AONB Partnership, said: “We are aware of the current test drilling in relation to potential zinc mining in the Nenthead and Coalcleugh area.
“At this stage it is simply a temporary presence on the moors which will determine whether or not the geological conditions are right for zinc mining here. We wouldn’t want to second-guess the nature and scale of any development that might perhaps result from it.”
John Riddle, chairman of the Northumberland National Park Authority, said: “Historically the North Pennines has been a mining area and there are clearly job opportunities here. However, the AONB and landscape issues would have to be looked at very closely.”
In an update in January 2015, Minco plc said that its exploratory work was very encouraging and that, if it were to progress to mining the deposits, it expected it could create 500 jobs in the area and recover over 1 million tonnes a year of zinc ore.
If the exploratory drilling of thirty boreholes can take place mostly unnoticed in an AONB like this one, why can’t drilling for onshore oil and gas be accommodated just as sensitively?
Drilling under, not in
The clear advantage offered by shale gas exploration, compared with exploring for zinc deposits in the North Pennines, is the use of deep horizontal drilling.
Essentially, the drilling and associated construction activities can be located outside National Parks and AONB, so as not to interfere with visual amenity for instance, but still enabling the search for hydrocarbons trapped in the rocks beneath them.
This is exactly what the changes to the Infrastructure Bill have achieved.
Western Europe’s largest onshore oil field at Wytch Farm in Dorset provides another example of how drilling for hydrocarbons can take place in sensitive areas. It is located within an AONB, on a Heritage Coast, in a Special Area of Conservation, Special Protection Area, Ramsar site and Site of Special Scientific Interest – and yet has been able to operate there with minimal impact, partly through the use of extended reach horizontal drilling.
Deciding where not to drill and frack should be about risk
The imposition of arbitrary bans on where development can and can’t take place is often counter-productive and risks introducing unintended consequences.
Instead, our tried and tested risk-based approach to planning and permitting should win out.
If, after careful consideration, a particular location is deemed unsuitable then it should be ruled out.
But if the very detailed Environmental Impact Assessments that shale gas operators produce determine that development can proceed, and planning officers agree, then there’s really no reason why it shouldn’t go ahead – even if that means drilling under a National Park or AONB.
So despite concerns in some quarters, allowing shale gas drilling and fracking under National Parks and AONB actually strikes a sensible balance.
RT @wwwOESGorguk: 30 exploratory wells drilled in North Pennines AONB since 2013, without issue http://t.co/LwH3FCU0Am @CarolineFlintMP
RT @remsolwaste: 30 exploratory wells drilled in North Pennines AONB since 2013, without issue http://t.co/tWP1ZuFkEy @GeoffreyLean @Telegr…
Good discussion about hydraulic fracturing in national parks http://t.co/VxcVGQyHlo of course needs handled sensitively @wwwOESGorguk
30 exploratory wells drilled in North Pennines AONB since 2013, without issue http://t.co/LwH3FCU0Am (no need for any riots) @AnneMcIntoshMP
30 boreholes drilled in an AONB in the last 2 years: relevant to current discussion on Infrastructure Bill: http://t.co/Uef3YhRrz5
I agree that there was a great deal of drilling that was jitsufied by the high price of natural gas that has brought on new supply. But as I pointed out, the industry data shows massive depletion over the first year. That means that we need continued new drilling activity just to keep the supply from fallingAll production depletes. Shales deplete faste. In some wyas this is good. For a given BCF/well you get your shale gas faster. Anyway, the expected decline curve is priced into the well economics. When we say “this well is economic at $5” we are factiring in the expected production curve. The thing about the shale formations is they are (relatively speaking) “blanket” formations. You can “manufacture” gas from them. You just lay out a grid formation and drill a well every 40 acres. In the old days, you had to locate structures, etc. With shales you don’t get dry holes. Wwhen the price is high enough, it’s like printing money.That means that we need continued new drilling activity just to keep the supply from falling. But the incentive to drill new wells isn’t there at $4.75 gas. While some of the early wells will do fine because their production was sold forward at a high price in the futures market, that option is no longer there for producers. Where you are right: if the price is not high enough production will decline.Whaere you are wrong: This means the price will be high enough. If gas production declines, and shortages ensue people will pay more for gas. Once prices are high enough we can drill the crap out of more shales.Hedging doesn’t make you drill wells. If you have nymex contracts at above market prices are better off cashing them out than drilling sub-economic wells.That is my point. The easy natural gas from CBM is now gone and production is heading south in a hurry.Nope, there is plenty of CBM that is simply not getting drilled right now because shales are better (actually, because prices are lower technically). The exact same CBM wells sitting in the exact same CBM fields as were getting drilled 2 or 3 years ago. They just stopped their programs. Ready to drill.I don’t think that we will have much drilling at $4 even if costs come down to $4. There is too much incentive for producers to keep as much in inventory as possible, particularly when shareholders are finally getting some understanding of the depletion issue.Again, if producers won’t drill at $4, price won’t be $4. Decline will set in, price will go up.I agree. But we already have some data and that is not as positive as the naive optimists believe. Well, I can’t be responsible for what naive optimists believe. I can tell you more or less what I already have. The shales are a huge new plateau on the natural gas supply curve, if I had to guess at around $5 or $6. They will be the marginal source of supply to the market for many years to come.This is an old story. There has always been someone telling us about the abundant amount of oil and gas in the American shale formationsFail to see the relevance of “what someone has always been saying”.I assure you people are out there drilling these wells and gas in coming out of them.The Barnett shale has already made a few billionaires. The Haynesville, Fayetteville and Woodford are well established. The Eagle Ford and Marcellus are growing dramatically as we speak. The Horn River has hit some big wells. Then there are 5 or 6 others getting attention as well. Mancos, Chattanooga, Utica, Antrim.Not even counting the Bakken, which is oil.We don’t know how big this is going to be, but it’s going to be big. The general projections I see are 5+ Bcfd for Haynesville and 5-10 Bcfd for Marcellus. I think Barnett is already doing 5 Bcfd.To put this in perspective, the Alaska gas pipeline (likely postponed indefinitely due to shale growth) is a 2 Bcfd project.
RT @wwwOESGorguk: NEW BLOG: #Fracking in National Parks and AONB http://t.co/LwH3FCU0Am Infrastructure Act strikes a sensible balance http:…
[…] Beauty to allow drilling “under but not in” the protected areas is a “sensible change”, according to the Onshore Energy Services Group […]
Did you read this http://t.co/LwH3FCU0Am @michaelnewcomb4? 30 wells drilled to search for zinc in an AONB without issue @ShaleInsider
Did you know you can now post comments on the OESG blog? It’s another way to facilitate dialogue. Try it here http://t.co/LwH3FCU0Am