No More Fracking – Is It Time?

by Nick Grealy

 
Given the enormous success of natural gas, is it time to stop wasting time debating with minorities only important to themselves and scrap the word “fracking” from our vocabulary?

Language is important. Many industry people have objected to the term “fracking” for example, on grounds that the corruption of the original “fracing” or fraccing” has been twisted by shale gas opponents. My view has been that having lost control of the word, we’re stuck with it, but I may have to change my mind. When the facts change, I change my mind.

The original bad word of shale was “unconventional” gas. Despite the UK being the home of the “eccentric”,  “unconventional” is a kiss of death to most things in English society, and indeed in many communities world-wide as well. In the UK, it transmogrified into something even worse: “controversial” shale gas as it was invariably described by the media. Controversial denotes fear, debate, uncertainty or worst of all to some, change.

 

Terms That Have Run the Course: “Fracking” and “Unconventional”

One of the most depressing things I’ve ever heard is a quotation that allegedly appeared in Jeremy Paxman’s book “The English.”  He said “To the true Englishman, any change at all is a change for the worst.” I can’t find it anywhere else, and the one time I met Paxman in 2012,  I had to ask him about it. He said he couldn’t remember writing it, but he’d be happy to have said it. Nothing denotes change, or controversy more than being “unconventional.”

Conventional natural gas and oil is the technique of drilling and finding gas in conventional reservoirs that has been around for years.  Conventional gas is hard to find, but easy to extract from discrete “pools” (even if it isn’t that simple) found relatively close to the surface where the permeability is fairly high.

fracking unconventional

Unconventional comes out of widely distributed but ultra low permeability rocks, almost taking gas and oil out on a molecular scale. It’s very hard to do, or at least was until the combination of hydraulic fracturing and horizontal drilling was used to produce far more gas and led to the death of the “dry hole” once the basin itself was proved. Today, the techniques are becoming more and more mundane. In short, unconventional is now an out of date term, as we see from this amazing news from the Energy Information Administration (EIA):

The shale gas boom, spurred by fracking and horizontal drilling, is bigger than anyone thought it would be. According to the US Energy Information Administration, natural gas derived from shale now makes up a full half of U.S. natural gas production, says Scientific American. Shale gas wasn’t supposed to make up such a large portion of our gas supply for another ten to twenty years.

Let’s face it. Shale gas was never supposed to work at all. But, it does. How can we possibly describe what is now the dominant, new normal method of natural gas production as “unconventional”? It’s like describing computers as “unconventional” typewriters, or an iPhone as an “unconventional” Nokia.

The IEA recently pointed out that in 2013 18% of global natural gas came from “unconventional” gas

“We are entering the age of much more efficient natural gas markets, with additional benefits for energy security,” IEA Executive Director Maria van der Hoeven

Ms van der Hoeven was hyper-cautious when I saw her at Shale World Warsaw in 2011. Production has changed her mind, as it has even enthusiasts. In 2008, Statoil paid $3.8 billion to link with Chesapeake in the Marcellus. Everyone in Norway thought they were mad as Rune Bjornson once told me.They recently told Shale Daily how that has turned out:

Statoil Natural Gas LLC President Jan Rune Schopp told the Boston audience Monday that production in the Marcellus has “gone beyond our wildest expectation, and it’s increasing by the day.”

Goldman Sachs said this about US natural gas prices recently:

Rising U.S. shale gas production is driving fear out of the futures market, says Goldman Sachs Group Inc., and will constrain prices for the next two decades.

Gone will be the near tripling of costs to $15.78 as in 2005 as traders remain confident the fuel will be there when needed. Natural gas will trade “largely” at $4 to $5 per million British thermal units for the next 20 years, says Goldman Sachs. Societe Generale SA sees prices at $5 through 2019. Bank of America Corp. forecasts $5.50 for 2017, while BlackRock Inc. projects $4 to $5 for the next decade.

“The market is rightfully not that worried because you have so much supply that is coming online,”

“People no longer have this fear of the future.”

Fear of Fracking Is Fading Fast – Time to Stop Debating the Self-Important?

Fear is what the debate in the has been built upon. The drumbeat of excessive caution continues in the groups demanding further study. Shale is “unknown”. The “precautionary principle” allows no experimentation with the unconventional or the controversial.

fracking precautionary principle

At a conference in London this week, in a speech that was very optimistic on shale’s potential in industry and in energy security, Labour shadow Energy Minister Tom Greatrex took deliberate pains or was that pleasure, in counseling against expecting too much from UK shale gas. Perhaps that’s simply some attempt to differentiate Labour from the coalition support for shale and give a bit of hope to the green elements of Labour. Some English like to talk success down. Success in England is meant to be effortless – or reserved for those born into it as posh Oxford types like Caroline Lucas, leader of the Green Party, prefer.

At the same conference, Matt Lambert of Cuadrilla predicted that one day everyone would ask what the fuss was about. Andrew Quarles, also of Cuadrilla recently said we need to make shale gas boring.

That moves us to two discussions. Not only do we need to allay fears about natural gas, we need to raise hopes. Natural gas can solve both climate and energy security fears and moderate energy poverty. On the last point, natural gas was expensive in Europe for a variety of reasons, chief among them the impact of oil-linked prices from Russia and the Asian LNG premium. Both are dying, as this from Japan points out:

In clinching a $400 billion deal last month to buy Russian gas, China may end up helping out its old political and economic rival in a way that matters hugely for Japan – energy security.

There are hopes that piping Russian gas to China will create a new price benchmark that could cut prices for Asian LNG buyers as well as providing new gas sources.

“This will surely put downward pressure on gas prices and some say it is the beginning of the end of the Asia premium,” Masumi Kimura, a researcher at Japan Oil, Gas and Metals National Corp (JOGMEC), said in a note, referring to the higher price paid for gas in Asia compared to other parts of the world.

The world now has huge supplies of natural gas that can replace, at a minimum, older and dirtier coal plants. The technology is scalable, affordable and achievable. We need to start telling that story about natural gas, instead of debating fracking with a noisy minority who don’t like any fuels other than sunlight and pixie dust.

no frackingOne day, and one day sooner than anyone thought, we won’t need to waste time with minorities only important to themselves. We do need to talk natural gas. Perhaps we can make the fracking word go the way of controversial and unconventional after all.

Editor’s Note: Nick makes a great point. The industry avoided the word “fracking” for too long in an attempt to steer people to proper terms and science. That allowed the anti-gas zealots to have the word to themselves. We needed to jump into that debate just to get alternative views to pop up in Google searches, if nothing else. But, perhaps the “fracking” phrase has now run its course.

The “fracking” cause certainly seems to have faded in many quarters. Perhaps we do, indeed, spend too much time debating the self-important on their terms when the world is moving on. Is it time to put an end to “fracking” and move the debate (there will always be one on the subjects of practices, taxes and impacts) to our battleground where rising natural gas production is already a given? Tell us what you think, please.

 

 

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About steve@bayintegratedmarketing.com

Steve Ulrich is a principal at Bay Integrated Marketing: www.bayintegratedmarketing.com. I have been working with people to maximize their use of social media and internet publishing, optimize their websites to turn prospects into customers, and establish their personal brand on the internet. We are also working with Eco Distribution, Inc. to find and implement practical solutions to help clean up our air and the environment. Eco Distribution, Inc. is a California based Distributor and Representative Firm dealing in environmentally friendly and Green solutions. We have leveraged 30 years experience in responsible construction management to provide solutions for some of the most impactful challenges facing our air, water, and land. We have an oil/hydrocarbon remediation system that is effective on everything from simple oil stains on a driveway, to complex oil disasters in the ocean. My approach to social media and internet marketing is simple. Instead of spending a fortune “buying” keywords and ads that don’t return anything we concentrate on three areas: I CAN GET YOU FOUND ON LINKEDIN - NUMBER ONE, PAGE ONE.
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