* Big Oil says to lift shale game standards
* Green groups say they heard it before
* Companies see room to reduce costs
By Tom Bergin
DOHA, Dec 8 Big oil and gas companies say
their increasing dominance of shale gas exploration will bring
improved drilling practices and should end the safety lapses
that have led to environmental opposition to the fast-growing,
multi-billion dollar industry.
Cases of water contamination and the leakage of flammable
methane gas into homes are due to occasionally shoddy activities
by some of the small players, who developed the industry over
the past decade, rather than fundamental problems with shale gas
drilling, some industry executives said.
Oil majors such as Exxon Mobil, BP and Royal
Dutch Shell Plc have begun to buy up the first movers
in the industry. At the World Petroleum Congress (WPC) in Doha
this week, big company bosses said they would help the shale
industry improve its game.
"I think Shell, or for that matter Exxon, coming in a big
way into this shale gas operation will actually drive the
standards up," Shell Chief Executive Peter Voser told a joint
press conference with Exxon CEO Rex Tillerson.
Environmentalists said, however, the desire to avoid
legislation was likely behind Big Oil's claims of future better
"We do not believe this. The large companies violate the law
regularly," said Amy Mall, senior policy analyst with the
Natural Resources Defense Council in Washington, D.C.
The oil and gas industry fears that public opposition will
drive increased regulation and restrictions on where it can
"Nature has given mankind the gift of natural gas. But our
hope now is, 'Please don't let government mess it up'," Jim
Mulva, chief executive of ConocoPhillips told the
The industry leaders say their massive research efforts can
help ensure the safety of the 'fracking' technique, which
involves blasting water, sand and chemicals into deep
underground reservoirs to release the gas trapped inside.
"I think companies like Exxon, we always put a high priority
on technology, so whether that's shale gas or any other resource
development, technology is a key part of it for us," Rich
Kruger, president of Exxon's production unit, told Reuters.
Jack Gerard, president of the American Petroleum Institute,
the U.S. oil and gas industry's main trade association, said
tough financial constraints on some of the companies that led
the shale gas revolution may have contributed to some of the
problems associated with drilling.
"There's a lot of competitors in the business, and as people
are driving those opportunities and looking for opportunities
... it tends to move rapidly, and sometimes they're not thinking
of the total consequences," he said.
But Erika Staaf, clean water advocate with
Philadelphia-based PennEnvironment, said the claim that bad
practices would be phased out as so-called "rogue" operators are
taken over was not new.
"That is a refrain that we've heard again and again," she
One thing the arrival of the big players to the market is
unlikely to bring is additional money. As the business expands,
companies are seeking to reduce the amount of spending on
Shell has established a "well manufacturing" joint venture
in China, which it hopes will provide more cost-effective means
of drilling shale gas wells that can be applied worldwide.
Speaking at the WPC, Andrew Gould, chairman of Schlumberger
, the world's largest provider of services to the oil
industry, said companies had significant opportunities to cut
"Current methods are wasteful and expensive," he said.