22 Mar 2013

Collaborative set to forge workable rules for shale hydraulic fracturing shows promise

Written by Jim Pierobon

Led in part by Chevron, Shell, the Environmental Defense Fund and the Clean Air Task Force, these and seven other organizations are now on record having identified “shared values” in an intriguing effort to better manage the risks of hydraulic fracturing of natural gas and crude oil from shale developments throughout Pennsylvania, Ohio, West Virginia and New York.

CSSD logoI signaled progress towards this type of collaborative and another initiative led by Michael Bloomberg last summer here.  With both now underway, industry and forward-thinking environmental advocates face an unprecedented opportunity to raise the bar in hydraulic fracturing.

Will most of the industry engage? THAT remains to be seen.

The new “Center for Sustainable Shale Development” could help to weed out companies willing to take short cuts which, if they trigger an major accident, could stymie shale development for years, perhaps decades. It might also compel companies with proprietary drilling fluids to share their ingredients – something not likely to impress drillers operating in friendlier political climes, e.g. Texas, Oklahoma and North Dakota.

Fifteen initial performance standards are “designed to ensure safe and environmentally responsible development” of the Appalachian Basin’s shale gas resources. They are to form the foundation of an “independent, third-party certification” process.

Among others, the standards include “state-of-the-art methods” to:

  • reduce air emissions and wastewater from drilling
  • disclose chemicals used in hydraulic fracturing
  • require producers to adopt “closed-loop” systems to contain drilling fluids and eliminate use of open pits
  • reduce methane emissions by capturing vapors in drilling and transmission processes
  • curtail the use of diesel generators that power drilling and fracturing equipment.

An independent contractor is to audit the companies’ compliance.

Whether more U.S. companies get on board is a decision each will reach on its own. Dan Whitten, a spokesman for America’s Natural Gas Alliance, said its leaders had not carefully reviewed the Center’s standards. EQT Corp. is one of the Alliance’s featured members and sits on the new Center’s board of directors.

Let’s hope their aspirations are not too far ahead of reality. Andrew Place, a former deputy director of Pennsylvania’s Department of Environmental Protection (DEP) and a Carnegie Mellon climate-change policy researcher who is the Center’s interim director, acknowledged that “None of us out there can do all 15 standards right now.”

Some reports, including this one in  The Philadelphia Inquirer, portend protests by hard core environmental activists. I for one hope enviros are not short-sighted and miss this opportunity to better manage the myriad risks involved and to build on the net emissions reductions that shale gas delivers compared to the mining and burning of coal for power generation.

The center grew out of a recommendation by a shale-gas committee that reported to U.S. Energy Secretary Steven Chu in 2011 in part because about 90 percent of all natural gas produced in the U.S. deploys hydraulic fracturing. The committee called for regionally focused councils of excellence in effective environmental, health and safety practices.

John Hanger, the former Secretary of DEP, took up the call in Pennsylvania. The center was initially incorporated as the “Institute for Gas Drilling Excellence.” But the name was changed to reflect that producers are drilling for oil as well as gas. Hanger bowed out after he became a Democratic candidate for governor last year.

Hanger was quick to spotlight the new Center on his blog here. There he vowed that “gas certified as sustainably produced will soon be demanded by gas consumers.”

As much as I’d like to believe that, I remain skeptical that the safer, more transparent development of a less-polluting fossil fuel will engender significant consumer support. Such demand has materialized for wind energy credits in states such as Pennsylvania and Maryland where consumers can choose to source their electricity supply from wind energy systems. But natural gas?

In addition to Chevon Appalachia and Shell North America, two other energy companies helped devise the standards and are represented on the Center’s board: EQT Corp. and Consol Energy. In addition to the Clean Air Task Force and Environmental Defense Fund, two other environmental or public service advocates are serving on the board: Citizens for Pennsylvania’s Future (PennFuture) and the Heinz Endowments.

Let’s see, that makes four from industry and four from outside the industry. If the board splits 4-4 on a key vote, it’s not immediately clear how such a tie would be deal with. Interim director Place could not be reached for comment.

A key player in the mix is Scott Anderson of the Environmental Defense Fund. Watch him here to gain a better sense of the stakes involved.

1 Comment to Collaborative set to forge workable rules for shale hydraulic fracturing shows promise

  1. April 1, 2013 at 10:55 am | Permalink

    Thanks for the reasoned coverage. We’re hoping that more companies will soon accept these standards, or that the ones who have accepted them will receive a greater share of business. Consol Energy, a coalition member, recently inked a deal with Allegheny County for drilling on 9,000+ acres. Municipalities would do well to choose companies that live up to these standards.

    The standards will be regularly evaluated and improved upon–including increased stringency in current standards and inclusion of new ones that will broaden their scope.

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