Energynomics Oct. 2013EN

Organization: Energynomics

Format: Opinion

ROEC expert: Radu Dudău

Date: October 15, 2013

This op-ed was published in the inaugural edition of the Energynomics magazine, QIV/2013, pp. 56-60.

The need for evidence-based debate about Romanian shale gas development

The ongoing civic protests against the Roşia Montană gold mining project, which started in early September and have continued with remarkable stamina, have also partly expressed adversity against potential shale gas developments in Romania. Indeed, there is an apprehension in parts of the Romanian society about the technology of hydraulic fracturing and its environmental effects, and an overall mistrust in any government-supported natural resource project, for good measure.

By the look of things, the apprehension stems mainly from precarious information, when not outright disinformation: on the one hand, emotional images from a popular anti-fracking documentary, portraying catastrophic environmental destruction and public health damage along the way of the American shale gas experience; on the other hand, interested and biased media campaigns led by a couple of self-styled “news” TV stations, busy with unrelenting fear mongering.

The mix includes economic nationalism, anti-corporatism, and radical environmentalism. In short, an atmosphere of induced fear, ideological reflexes, and private interests, in which public debate lacks science-based argumentation. This, however, is a major deficiency of the public conversation on the future of shale gas in Romania, in particular, and of the public policy-making process, in general.

A case in point is the recent association by some media outlets between a series of low magnitude earthquakes that have taken place in October in the Galati county, and alleged shale gas activities in the area. There is no basis whatsoever for such claims, since there are no shale gas operations there – or anywhere else in Romania, as yet, for that matter. Nonetheless, a Green Party protest on the spot promptly denounced just that.

To be sure, public interest projects cannot be properly defined and pursued without evidence-based risk assessments. In particular, no serious public debate will rely only on documentary-extracted statements. For one thing, they typically come to face counter-documentaries. For another, at least at some level of analysis, the policy decision-making process must turn to sound scientific evidence. After all, civic responsibility is just as much a matter of moral stance-taking as it is a matter of adequate knowledge.

Typically, the parties in the shale gas debate take extreme and untenable positions: on the one hand, critics tend to drastically exaggerate the risks involved in shale gas extraction; they depict vast tracts of polluted land, poisoned watercourses and aquifers, tens of thousands of sickened people, and polluted air, all of them converging in a pervasive threat of cancerous diseases. On the other hand, many industry representatives deny any risk, and smilingly downplay the past occurrences of environmental incidents.

However, there have been significant cases of aquifer pollution, because of poor cementing of the well, and there also have been instances of egregious river and land pollution. But such incidents were rare compared to the hundreds of thousands of shale gas wells drilled in the U.S. Indeed, a 2011 MIT study documents that out of 20,000 wells observed between 2005 and 2009, 20 did results in aquifer contamination with natural gas or wastewater – that is, a rate of 1 per 1,000. Those were caused by some of the numerous small gas companies that joined the “gold rush” of the unconventional gas upsurge in the U.S., and never by the large and resourceful energy majors, observant of the sector’s regulations and best practices. In any event, new regulations have been put in place following cases of accident and deliberate misconduct. They include, among others, norms of disclosure for chemicals in the fracking fluid, specifications for the water treatment facilities, and regulations about the underground wastewater disposal sites.

The industry has the know-how and the means to cope with such risks. But they have to be assessed based on scientific studies instead of subjective, fear driven, negative perceptions. All in all, although not risk-free, shale gas production has proven barely environmentally riskier than other extractive industries, including conventional oil and gas.

Indeed, the relative risk assessment of various extractive industries is yet another missing dimension of the current shale gas debate. Let alone that the technology of hydraulic fracturing has been used in Romania for decades to increase the recovery rate in conventional oil and gas wells – true, with smaller volumes of fracturing fluid and different chemical ingredients; but the dreaded practice of wastewater disposal by deep-underground injection has been frequently done in the conventional oil and gas industry. Also, the water volumes required for fracking are quite significant, yet relatively low in the ranking of other extractive industries: way below coal mining, for instance, and even less so than coal-based power generation.

That said, shale gas production is not at all like, say, tulip planting. It involves heavy truck traffic, intense noise, odorous (and potentially hazardous, unless properly controlled) gas emissions, and water consumption. It is much more pleasant to not have such a drilling pad in front of your house than to have one. This is a good reason why the local communities should be properly protected and compensated with a dedicated proportion of the generated revenue, as they would bear most of the environmental and social costs of those activities.

Nevertheless, Romania is still a long way from knowing anything of highly probable shale gas resources. The ongoing public contestation unfolds as exploration has not even begun. While the EU-level regulations of drilling, cementing, water use, and methane emissions will likely render uneconomical certain shale development projects by raising compliance costs, it is at least important to have information as accurate as possible about Romania’s subsoil resources. At the very least, future technologies may well extract them more efficiently and more safely.

Along with the gas reserves of the Black Sea offshore, the presumed shale gas resources have a strategic importance for Romania. Although relatively little dependent on energy imports, the country belongs to a monopolistic regional gas market, with one single external provider supplying about a quarter of the present consumption at prices substantially above the EU average. Moreover, unless new gas supplies – domestic and/or external – come on-stream, the rapid depletion rate of the country’s conventional hydrocarbon resources may raise the import dependency to about 70 percent in one decade’s time. Energy security is, indeed, a strongly compelling element that demands development of new gas sources.

Against this background, the most important element right now seems to be the quality of energy governance. Politically and financially independent energy regulators (the National Agency for Energy Regulation and the National Agency for Mineral Resources), capable to implement and enforce robust, science-informed regulations, are going to be key pieces in the process of regaining public confidence in the state’s ability to develop itself by natural resources exploitation.

Apart from that, independent academic experts should be involved in discussing the communities’ concerns about the impact of industrial activities, and both the gas companies and the governmental authorities should encourage that. Scientists and academic analysts can serve both as credible information providers, and as helpers in the needed assessment of local risks.