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Is European Shale Gas the Real Deal

Dave Forest,
Oilfield services major Halliburton said late last week it has completed the first hydraulic fracture (frac) on a horizontal shale gas well in Poland. The Markowola-1 well was drilled 50 miles south of Warsaw, on behalf of Polish state petroleum company PGNiG.

This is a big moment. There’s been a shale land rush of late in much of Europe, with gas companies big and small picking up millions of acres of prospective land. We’ve heard a lot of talk about trillions of cubic feet of potential gas resources.

Wells like Markowola will answer some important questions. Like, will these huge gas resources actually flow to surface?…

…There’s a big difference between proving geology and proving economic viability (the latter being far more important). Keep that in mind as news on Europe’s shale emerges over the coming weeks and months…
(16 August 2010)

Shell Seeks To Ease Ukrainian Shale Gas Legislation To Promote Production

RBCUA, Oil & Gas Eurasia
Shell will ask the Ukrainian Fuel and Energy Ministry to change legislation regarding shale gas production, Kommersant Ukrayina reports. During a roundtable entitled “The Prospects for Shale Gas Development in Ukraine” held in Kiev on August 12, Aleksey Tatarenko, Shell’s liaison with government officials in Ukraine, stated Shell intended to invest in the segment if bigger areas are offered for production and license periods are lengthened and tax breaks introduced…
(July – August 2010)

Industry should heed NY moves against shale boom technology

Sheila McNulty, FT Energy Source Blog
New York state is making inroads against hydraulic fracturing, the process that has enabled the big natural gas boom in the US in recent years. This is something environmentalists have been pushing for, and gaining traction with. They worry about what the fracturing of rock underground is doing to groundwater and what the entire process does to air pollution.

This week, the New York state Senate voted by a wide margin – 48 to 9 – in favour of a temporary suspension through May 15, 2011, on new drilling permits for the fracturing of shale rock deep under the ground. The fracturing process involves pumping underground, at high pressure, millions of gallons of water laced with chemicals and fine sands. The water breaks apart the rock and the fine sands prop it open so the gas can escape and be pumped out of the formation.

The government has been responding on several levels. In March, the US Environmental Protection Agency said it would carry out a comprehensive examination of the safety of hydraulic fracturing. Congress requested the study last year. And the issue has been getting more attention since ExxonMobil announced it was buying XTO Energy to boost its presence in the onshore gas boom. Indeed, Exxon was even wary enough to put an exit clause into the acquisition plan, allowing it to walk away if hydraulic fracturing became uncommercial. That deal closed in July, but the move against hydraulic fracturing has not stopped…
(5 August 2010)

Pennsylvania broke law on natgas water use: group

Jon Hurdle, Reuters
Pennsylvania regulators are illegally allowing natural gas companies to withdraw water from rivers and streams for use in the Marcellus Shale drilling boom, an environmental group claims.

The Allegheny Defense Project says the state’s Department of Environmental Protection has no legal right to permit drillers, as it does, to take millions of gallons of water from rivers in the western part of the state.

That right belongs to owners of riparian land — that which borders waterways — but DEP has ignored the law in facilitating the industry’s demands, the group said in a letter sent to DEP Secretary John Hanger in late July.

The letter is the latest criticism by environmentalists who are concerned about the impact of the booming industry of drilling for natural gas in onshore shale formations…
(9 August 2010)