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EOG Says U.S. Fracking Rule to Cost $1.5 Billion a Year

Kasia Klimasinska, Bloomberg
The Obama administration’s plan to tighten regulation of hydraulic fracturing for natural gas on public land may cost more than 20 times U.S. estimates, energy companies and local governments said.

EOG Resources Inc. (EOG), the top oil producer in a Texas shale formation, and officials from Wyoming and Utah cite a study by John Dunham and Associates that said it will cost $253,839 per well to meet the proposal for disclosing chemicals being used and certifying the well is isolated to avoid leaks. The Bureau of Land Management estimated costs at $11,833 per well.

“The proposed rule is unnecessary, excessive and requires actions that no state currently regulating oil and natural gas production deems necessary,” Eric Dille, government affairs director for Houston-based EOG, said in comments posted on a U.S. website Aug. 31. “The proposed rule will also place undue economic burdens and time delays on independent oil and natural- gas producers that will inevitably drive many smaller companies away from exploring for oil and natural gas on federal lands.”..
(7 September 2012)

Shale gas will not cut EU import dependence: study

Charlie Dunmore, Reuters
European development of shale gas could offset the decline in its conventional gas output but will do nothing to reduce the continent’s dependence on imports, a European Commission study has found.

In the United States, a boom in production of cheap shale gas in recent years has pushed down energy prices and cut greenhouse gas emissions, prompting calls from industry for Europe and others to follow suit.

But investors say the U.S. shale gas revolution is unlikely to be repeated in Europe, due largely to environmental concerns and different rules on land and resource ownership. Some EU countries have even banned shale gas exploitation.

"Shale gas production will not make Europe self-sufficient in natural gas," the report by the EU executive’s Joint Research Centre said…
(7 September 2012)
Link to report

EU study sparks regulation debate over ‘high-risk’ shale gas

Tough new regulations could be slapped on the shale gas industry if the EU acts upon legislative and environmental failings identified in its most comprehensive analysis yet of the sector, due to be released today [7 September].

Shale gas drilling poses a ‘high risk’ to human health and the environment that is worse than that posed by other fossil fuels, according to a 300-page report prepared by the EU’s environment directorate. It is also currently unregulated.

The study identifies eight areas of high-risk due to the cumulative effect of multiple shale wells, including the contamination and depletion of ground and surface water, and degradation of biodiversity, land, air quality and seismic conditions.

Water contamination is considered a high risk because of the industry’s hydraulic fracturing – or ‘fracking’ – technique. It involves drilling horizontally to shale deposits at depths of up to 3km, and pumping in large amounts of water, sand and chemical lubricants at high pressure to shatter the brittle rocks.

The sand fills geological pores, preventing the well from collapsing, while the gas migrates upwards, along with some water contaminated by fracking chemicals and other pollutants, including low-levels of naturally radioactive material.

Because of the health and environmental risks, the study recommends that fracking should only be allowed under strict conditions, and not yet on an industrial scale. No fracking should be be allowed in areas where water is being used for drinking purposes.

“Do nothing’ does not seem to be an option anymore,” one EU official told EurActiv. “There are barriers, gaps and uncertainties and this is not the best premise to establish a shale gas industry in Europe.”
(7 September 2012)
Link to report

Davey takes aim at shale gas lobby with defence of Energy Bill

James Murray, Business Green
Energy and climate change secretary Ed Davey has challenged a series of "myths" attached to the government’s Energy Bill, arguing the controversial reforms are not a disguised nuclear subsidy and have not been made unnecessary by the discovery of European shale gas deposits.

Speaking at a CBI event yesterday evening, Davey tackled a series of criticisms that have been levelled at the Energy Bill, and, in comments that will be interpreted as a direct challenge to some of his Conservative colleagues in the coalition, he rejected suggestions the UK should water down the proposed reforms and instead focus on boosting gas capacity.

Davey said one of the myths he wants to "knock down" is that "our reforms are unnecessary, because a global glut of cheap gas will solve our investment and carbon problems".

He insisted he was not "ideologically wedded" to any energy source and reiterated gas will play a key role in the UK’s energy mix over the next two decades, with the government’s Carbon Plan predicting between 10GW and 20GW of new gas capacity can come online in the next 20 years without jeopardising carbon targets.

But in a direct challenge to the pro-gas stance of Chancellor George Osborne and new environment secretary Owen Paterson, Davey insisted the carbon impact of new gas plants and the price volatility of internationally traded gas meant there was no safe alternative to increased investment in renewables and nuclear.

He also dismissed suggestions that the emergence of new shale gas supplies make a "dash for gas" attractive.

"Yes, prices can go down, as well as up," he said. "And yes, unconventional gas can make a difference, although perhaps not as big a difference as some sections of the press would have me believe…
(11 September 2012)

California fracturing takes less water than Texas

David R. Baker, fuelfix
In Pennsylvania, the practice of hydraulic fracturing for each well can consume 4.5 million gallons of water, the liquid pumped deep underground to crack rocks that contain natural gas.

In parts of Texas, fracturing a well often takes 6 million gallons.

But in California, where fracking is starting to spread, the average amount of water involved is just 164,000 gallons, according to industry data.

Hydraulic fracturing, known as fracking, has triggered a boom in energy production across the United States and sparked a fierce public debate that revolves around water. Critics say fracking can ruin drinking water supplies when badly built wells allow chemicals used in the process to seep into aquifers. The disposal wells that take used fracking water and bury it far beneath the earth’s surface can trigger earthquakes…
(11 September 2012)