(Corrects paragraph six by removing the words "and fracked".
John Kemp is a Reuters market analyst. The views expressed are
By John Kemp
LONDON, April 29 The village of Balcombe in West
Sussex, with fewer than 2,000 residents, is set to test whether
Britain's politicians, media and public can strike a sensible
balance between climate change and energy security, local
concerns and national priorities.
Balcombe has become a rallying point for a broad alliance of
environmentalists and community groups opposed to the
introduction of hydraulic fracturing for shale gas in Britain,
as Guy Chazan explains in a thoughtful article in Monday's
Financial Times ("Sussex village of Balcombe is focal point of
fracking opposition" April 29).
Britain's pioneering fracking firm, Cuadrilla Resources, has
planning permission from West Sussex County Council, the local
authority, for exploratory drilling in the area, though it has
no plans to do so at present, according to the firm's website.
Cuadrilla appears to be focusing on exploration and
development in other parts of the country. The battle of
Balcombe is therefore something of a phony war.
But Balcombe is a symbol for a much bigger fight over energy
and climate policy, as well as local development. Even if
Cuadrilla has no plans to drill and frack at Balcombe, shale
wells will have to be drilled and fracked at similar locations.
Cuadrilla has already drilled several wells hundreds of
miles to the north in the county of Lancashire. But the company
was forced to suspend operations after fracking a well too close
to a fault and triggering small earthquakes in April and May
The largest registered magnitude 2.3, just enough to be
felt, though far too low to damage property or endanger life,
according to the official report on "Preese Hall shale gas
fracturing: review and recommendations for induced seismic
In December 2012, the Department of Energy and Climate
Change (DECC), which regulates oil and gas exploration,
announced it would be prepared to allow fracking to resume,
subject to stringent controls.
Fracking will be subject to a "traffic light" regime that
will require operations to be paused and reviewed if there are
signs they are starting to induce earthquakes. The initial
monitoring threshold will be set at a very low level of
magnitude 0.5. This could be raised over time as more experience
is gained with the procedure, and, though DECC did not admit
this, if public concern declines.
PERCEPTION AND POLITICS
Fracking opponents in both the United States and the United
Kingdom cite a number of concerns. Chemicals used in fracturing
operations could contaminate drinking water supplies. Fracking
triggers earthquakes. And the enormous amounts of water used
could put pressure on local rivers and aquifers.
So far, none has proved well-founded. Fracking can indeed
create small earth tremors. But there are only three confirmed
examples worldwide of significant induced seismicity even though
more than 1 million wells have been fractured. None was large
enough to damage property or endanger life. Geothermal energy
and mining operations have caused more, and larger, earthquakes,
without sparking equivalent levels of concern.
There are no confirmed instances of fracturing contaminating
drinking water supplies. In most instances, fracking chemicals
are pumped thousands of feet below the drinking water table.
Preliminary reports of contamination from gas wells in
Pavillion, Wyoming, are disputed and are being reviewed by
Pressure on rivers and aquifers is a legitimate concern. But
water abstraction for farming, industry and local communities
cause similar problems. Scarcity is a case for strict regulation
of water use rather than an objection to fracking per se.
Frackers face daunting challenge in Britain
Fracking by the truckload
Frack on Your Majesty, you may be shale winner
Seismic risk of fracking has been overstated
Smart fracking will cut costs, save environment
The real objections seem to be political. Environmentalists
fear any increase in supplies of fossil fuels will lessen the
momentum to develop cleaner alternatives like wind and solar.
Local residents fear the impact of large-scale oil and gas
development on their quality of life.
Fracking is enormously disruptive. Drilling and fracturing a
single well can result in nearly 2,000 truck movements over the
first two years, according to the Department of Transportation
in North Dakota, which has more experience with the technique
than anywhere else as a result of the Bakken oil boom.
Drilling and pressure pumping equipment must be brought in,
assembled, then removed at the end of the process. Fracturing
itself requires prodigious volumes of water and sand to be
brought to the site. Once the well is fractured it must be
connected to gas and oil gathering pipelines, or trucks must
periodically visit the site to carry away produced liquids.
Community attitudes to fracking vary widely. Differences
tend to reflect local economic conditions and previous
experience with energy and mineral extraction.
In the United States, shale oil and gas has been encouraged
in states like North Dakota, Oklahoma, Kansas and Texas, where
it is seen as boosting the local economy, but viewed much more
sceptically in New York and California.
Britain's shale gas deposits are widely distributed across
the country, according to the last assessment of "The
unconventional hydrocarbon resources of Britain's onshore
basins" published by the British Geological Survey (link.reuters.com/xeb77t).
Some are located in northern England and Scotland, which
have more experience with oil and gas extraction, as well as
coal mining, and have been hit hard by the closure of much of
the local mining, steelmaking and shipbuilding industries in the
1980s. Some may therefore welcome shale development if it
promises local jobs and more revenue.
Other deposits, like Balcombe, are in the country's far more
prosperous southeast and have less need for local development
and less familiarity with resource extraction. Balcombe has
almost 60 percent more people who describe themselves as
managers, directors and senior officials than the national
average, according to the latest census (link.reuters.com/tyb77t)
In such areas, shale drilling is more likely to be seen as a
disruption rather than a benefit.
LOCAL REGULATION AND BENEFITS
In the United States, oil and gas drilling is regulated by
the states, and in some cases local communities, and royalties
are payable to the private owners of mineral rights, most of
whom are local people. Local regulation and royalty payments
have built an important constituency in favour of fracturing in
In Britain, licensing and regulation are conducted centrally
by DECC and royalties are received by the government.
Communities that host shale gas wells are likely to see all of
the costs and disruption but with no input and no share of the
The government is keen to give residents more of a stake in
the process and an incentive to approve drilling and fracturing
projects. Local authorities already have substantial power to
control the incidental aspects of drilling and fracturing
because of their control of the planning process.
Ministers have floated the idea of extending these powers
and allowing communities to share some of the benefits through
reductions in their energy bills or funding for local facilities
such as schools and sports facilities, to be paid for by
fracking operators, according to the Financial Times ("Ministers
consider fracking sweeteners" April 29).
With appropriate regulation, substantial oil and gas
extraction is possible even in very sensitive locations in
Britain's largest onshore oil field, at Wytch Farm, produced
more than 100,000 barrels per day at its peak from a series of
horizontally drilled wells snaking under the World Heritage Site
of the Jurassic Coast and the wealthy yachting centre of Poole
Bay, which includes some of the most exclusive and expensive
real estate in the country, all from a carefully landscaped site
screened by thousands of trees.
Drilling is not entirely new in Balcombe, either. An oil
well was drilled in the village by Conoco in 1986, though it was
subsequently plugged and abandoned.
Many of the same local groups which are mobilising against
shale gas also fiercely oppose onshore windfarms because of the
visual blight. Yet the same voters complain bitterly about
rising utility bills and still want to fly from nearby airports
like Gatwick and Heathrow to take foreign holidays and business
trips, all of which use enormous volumes of fossil fuel.
Shale development has become intensely political. Britain's
finance ministry, concerned about economic competitiveness and
energy prices, has become an enthusiastic supporter. DECC, which
is more worried about climate change, is sceptical about whether
shale gas supplies are big enough to make much difference and is
adopting a far more cautious approach.
The British Geological Survey is preparing updated estimates
which are expected to show a big upward revision in the
country's shale gas resources. DECC has asked it to review some
of the findings, apparently to dampen some of the enthusiasm.
Shale gas touches some of the rawest nerves in British
politics, pitting national priorities against local concerns,
economic development against the environment, fossil fuels
against clean energy.
How the government, media and public handle the issue will
be a key test of how well they can deal with even more
complicated choices posed by climate change and the country's
dwindling North Sea oil and gas supplies that cannot be reduced
to a simple sound bite.
So far the indications are not good.
(Editing by Anthony Barker)