It Fractures

[Thanks to northernindymedia]

Max Smeets

Shale gas.  Attention for this topic has been growing on the local, national, and international levels (see THB’s ‘The Future’s So Dire, We Gotta Pump Shale’). Shale gas is the gas that has, at several places in the world, including the Netherlands, become accessible through a combination of horizontal drilling and hydraulic fracturing. Due to the low permeability, a mix of water, sand, and chemicals is injected to get it all out of the ground.  This article covers some interesting recent developments on all 3 levels.

In the US shale gas mining started in the 1970s on an industrial scale. Today, the production of natural gas from shale formations has rejuvenated the natural gas industry in the United States – and it is still booming. In the last couple of years other countries have followed suit and started to explore the possibilities. We have seen developments in Canada, India, South-Africa, Australia, some European countries, and above all China.  There is an upsurge of billion dollar contracts being struck and explorative drilling is increasing.

In fact, two months ago PetroChina – partnering up with Shell – said it had found a new shale gas deposite in Szechuan. The only problem was that the geological conditions are more difficult than in the US.  Still, China sees possibilities in it and they don’t hide their ambition. They want to become the shale gas giant. A statement of Fu Chengyu, chairman of state-controlled Sinopec Corp made that all too clear; he stated that China’s shale gas production would surpass that of the United States within a decade. China’s tone is not surprising, taking into account that the country is dependent on other countries for about half its gas supply.

Europe is a bit more hesitant and divided on the issue.  Countries like France, with a strong nuclear lobby, and Bulgaria remain unenthusiastic. Still, most countries with shale gas deposits are understandably in favour. Even if economic and environmental aspects cancel each other out, the political dimension makes sure that most countries will follow the US example. For a start, shale = no reliance on Russia. And the Polish example in particular shows that especially Eastern Europe likes this all too well. Warsaw gets 70 percent of its gas from Russia. A shift to shale could mean they have a secure energy supply for 200 years - and Putin loses his economic weapon.

What about the Dutch? TheNetherlands has sizeable deposits in Brabant and Gelderland.  Taking a long term perspective the Dutch government is leaning towards seeing this in a favourable light. According to Jan-Dirk Bokhoven, director of Energie Beheer Nederland (EBN), the Dutch have long been addicted to gas and the profits it brings, and shale is just a welcome extension of this attitude. When there’s an estimated 40 billion Euro worth of shale gas in ground, and the conventional gas fields getting empty, “you don’t leave that alone” (see EBN’s report ‘Unconventional Gas in the Netherlands’ from 2010)

In 2010 questions were asked about shale gas drilling in the Dutch parliament, mainly concerning the production process. The EBN calmly provided the answers, saying that the amount of chemicals used during fracturing is very little.  When a second hearing on 14 September 2011 addressed ‘the risks of drilling shale gas’ the economic potential was especially emphasised. While investigations continue to look into the problems and possibilities of shale gas, the Ministry of Economic Affairs has already provided drilling licenses for the Brabant fields to Cuadrilla, Hutton Energy and DSM Energy.

There is only one problem – the Dutch locals don’t like shale gas. That has become all too clear recently.  In January, the municipalityof Haaren refused to provide a license for an experimental drilling operation by Cuadrilla just outside the town. While in 2010 the mayor and councilors were prepared to provide a temporary exemption and let it go ahead, they now seemed to have changed their minds. The reason was a court judgment in Den Bosch regarding a similar drilling project in Boxtel. The municipality provided the license but the judge decided it was invalid because the temporary nature of the drilling could not be guaranteed.

Boxel is an interesting case, not only because Cuadrilla wants to continue there, but also because former Interior Minister Piet Hein Donner was not very clear about the financial aspects of the deal. The Brabants Centrum reported that Cuadrilla has given much more to the municipality than the 229,000 Euro Donner has previously stated, suggesting instead a figure of 336,522 in total.

All in all, not only will the international battle for shale gas be heating up, but in the Netherlands itself the battle is likely to become more intensive. Shale gas fracturing is a welcome addition to the Dutch economy, but not in everyone’s backyard.

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