16 Nov 2011

Opinions very widely over efforts to explain shale gas drilling to landowners, lawmakers in U.S.

Written by Jim Pierobon

PITTSBURGH, Pa. — Two-hundred and ten truck trips, 3-4 million gallons of water and noticeable degradation of rural roads. Those are typical metrics for a natural gas well that needs hydraulic fracturing to unleash embedded U.S. shale deposits deep underground. Together they can make for a very tough sell to area landowners, lawmakers and regulators.

Here are logos of four organizations making strides educating stakeholders about shale natural gas development in the U.S.

But selling they ARE doing in most shale gas regions of the U.S. Here above the Marcellus shale gas ‘play’ below western Pennsylvania — the largest such bonanza in the evolving natural gas drilling boom — many private and some public opinions differ widely over whether the industry should be doing more to educate stakeholders.

Several representatives of hundreds of gas development companies and their vendors gathering this week at Hart Energy’s DUG East conference and exposition here acknowledged with all of the money to be made well into the future, existing outreach efforts are making some progress, but are not yet moving the needle of public opinion as far  as they can tell. Some of these efforts — on TV, the web and in state capitals — are very proactive and are connecting with viewers, readers and policymakers. How long it will be before operators experience benefits remains to be seen.

If you’re in New York state or Maryland, the verdict looks to be a long way off. In West Virginia it’s all systems are ‘GO’. In Pennsylvania and perhaps Ohio in the coming months, key stakeholders and their elected officials are listening. But are they digesting the industry’s compelling, three-pronged, message: shale gas creates jobs, helps reduce greenhouse gas emissions and enhances U.S. energy security?

With that kind of firepower, how can anybody NOT take notice?

“We have to be environmental stewards. We have to address community issues  . . . hense the sense

Logo for the Gas Technology Institute

of urgency,” Richard Vaclavik, Northeast Vice President for international oil services giant Halliburton told a DUG East Environmental workshop Tuesday.

“Public sentiment is becoming more influential,” said Courtney Diezi, Director of Marketing and Sales for Falcon Technologies of Houston. “We need to listen. Reputations can be our best assets or our worst liability.”

“We have to take (this PR challenge) more seriously than we did a few years ago,” added Vaclavik. “We have to change our thought process. We’re moving in the right direction, but we’re not there yet.”

A real test case is playing out in the Pennsylvania capital.  There lawmakers are nearing agreement in the first bid to assess a tax on Marcellus shale drilling since the boom began in earnest in 2008.

Late Monday night, Nov. 15, the Pennsylvania Senate voted 29-20 to assess a decreasing fee of $50,000 per well annually, strengthen environmental regulations and address local zoning rules. Most the fee, which would be assessed over the first 20 years that a well produces natural gas, would be split between the state and local levels: 55 percent for counties and municipalities in the Marcellus Shale region, and 45 percent to statewide infrastructure repairs, environmental programs and natural gas use projects, according to the Pittsburgh Post-Gazette.

A few minutes after the Pennsylvania Senate vote, the House amended a bill it has been working on bringing the two chambers close to agreement. Republican Governor Tom Corbett appears ready to sign a consensus bill.

Looking at where this industry as the drilling boom has mushroomed, the industry IS doing more to explain its environmental and water management practices than it was just a few years ago. Take the national American Natural Gas Alliance, the Marcellus Shale Coalition and the Barnett Shale Energy Education Council. For years, the Gas Technology Institute has been a bedrock of credible, fact-based and data-driven research (logos at left).

Up until recently, the industry has been driven by a ” ‘Git-R-Done’ attitude”, said Mark Bitting, President, QC Energy Resources LLC, a presenter at a companion Water Management workshop. Currently, most of the industry is deploying technologies to reduce the need for water and better manage the the “flowback” of waste water out of producing wells.

In the future, Bitting said, more aggressive measures and partnerships with vendors will further improve water utilization, reduce costs and ensure compliance with safety best practices. How we wish THIS mentality was in place in the spring of 2010 before BP’s Macondo well blew out in the Gulf of Mexico. Different environment yes; but the lesson was not lost on many at DUG East.

Remarks by Dave Kern, an Area Manager for Kroff Well Services, summed it up best. He asked Water Management workshop attendees if the industry had enough of a “conscience” to do the right thing.

Attendees were reminded of his parting words at day’s end. As they left the Pittsburgh convention center, they were greeted with hundreds of “Occupy Pittsburgh” protestors complaining about jobs and the industry’s environmental impact. Without propane from natural gas drilling used to heat ‘Occupy’ protestors in northern cities and the thousands of jobs the Marcellus shale play is generating, a few workshop attendees agreed the protestors might have a point.

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