A review of fracking related incidents in news headlines shows that best practice guidelines are not a panacea for the risks inherent in fracking. On the ground operations and the lived experience of communities where fracking occurs proves that best practice standards don't provide the level of protection people expect when a risky, incident-ridden industry is approved for their neighbourhood.
Approval processes for fracking projects don't appear to include best practice standards either. Overseas and on the mainland CSG, shale and tight gas licences have been approved despite significant unknowns, such as the effects on health, water, environment and communities.
100 Years of Oil and Gas
The idea that we can continue to burn fossil fuels for the next 100 years and safely vent many more millions of tonnes of greenhouse gas emissions into the atmosphere flies in the face of both reason and science. However, like much of the rest of the industry's PR hype, it seems this grim prospect is also flawed.
Geopolitical analyst and strategic risk consultant William Engdahl believes America's shale energy revolution is a huge ponzi scheme. He says industry claims that fracking will provide gas for a century and create millions of new jobs are 'myths, lies and Wall Street hype'.
Americans are being subjected to a massive PR assault attempting to persuade them that shale gas and tight oil have brightened America's energy future. The problem? It's simply not true.
The unique and rapid decline in fracking well production rates and the industry's toxic reputation means that investors will ultimately choose less risky, more acceptable investment opportunities.
The unconventional oil and gas industry maintains that fracking is proven technology that has been used safely for over 60 years. The industry is relying on our general lack of knowledge and expertise in this area when it makes this claim. It is true that fracking has been used in conventional gas wells for decades, but large scale onshore gas fracking only became possible as a result of technological advances that were commercialised in the Barnett Shale in the US in 1997. Fracking as we know it today is less than 20 years old.
Lower Gas Prices
Tasmania is part of the single eastern Australian gas market, and despite what the industry says, no amount of unconventional gas development in Tasmania or anywhere else is going to affect the price Tasmanians pay for their gas.
When the Gladstone LNG pipeline was completed, Australian gas prices became permanently linked to the Asian market. This set the scene for a substantial rise in the gas price domestically, because the wholesale gas price in the Asian market is set by global gas prices. Australians can expect to pay triple or quadruple for their gas now, because gas producers can now sell to markets where gas fetches 3 or 4 times the price paid for gas domestically.
This new ability to export gas is part of the reason that gas producers are lobbying against Australia setting aside a domestic gas reserve - an amount of gas that can't be exported; gas that must be reserved for Australian consumers and sold at domestic prices. Successful lobbying is not only price-gouging Australian households, it's hurting manufacturing and threatening 1000s of local jobs.
Ironically it's not increased demand or gas shortages driving up the price, it's the supply side. Without the introduction of slickwater fracking, which enabled companies to extract commercial quantities of unconventional gas, the amount of gas the industry could mine wouldn't have been enough to justify the construction of LNG facilities.
The fracking industry strongly promotes the fact that the gas they are extracting is 'natural gas'. This is pure public relations campaigning to win the trust of communities - who can't fail to be aware of the well publicised risks and failures of fracking, and who are 'naturally' apprehensive when their towns are threatened.
Members of the public do see through the industry's well oiled (pun intended) PR machine and can clearly distinguish between the gas bearing formations, which are of course natural, and the process by which the gas is extracted - which is anything but.
Cleaner Than Coal
Unconventional gas is a fossil fuel made up almost entirely of methane. Methane, like carbon dioxide (CO2), is a greenhouse gas. Methane is a far more potent greenhouse gas than carbon dioxide. Scientists estimate the global warming potential of methane to be 100 times greater than carbon dioxide during the first decade after it’s emitted, decreasing to 34 times greater over a 100 year period.
For more than a decade the fracking industry has tried to greenwash itself by stressing that frack gas is cleaner than coal. The industry points to evidence that suggests burning natural gas produces only half the CO2 emissions as coal per unit of energy. Hand on heart, the industry says fracking for unconventional gas can help efforts to reduce greenhouse gas emissions.
Numerous studies have questioned, tested and then debunked this idea. Most recently, five research groups from Germany, Austria, Italy, Australia and the US tested the claim using five different computer models to project what the world might be like in 2050 with, and without, a natural gas boom. The models came up with the same alarming conclusions: that instead of lowering CO2 emissions, burning natural gas could result in emissions being up to ten percent higher by 2050.
Virtually all economic analysts agree that fracking for gas will discourage investment in renewable energy technologies, and lock us into continued reliance on fossil fuels in an increasingly volatile and expensive international gas market.
Jobs, Jobs, Jobs
The unconventional gas industry looks attractive because it says it will bring much needed jobs and investment to local communities. Gas companies don't mention that this comes at the direct expense of local businesses and other industries such as agriculture, manufacturing, education and tourism.
To dispel the jobs myth, fracking companies:
- Quote exaggerated jobs numbers a project can be anticipated to create and include indirect jobs in the figures they announce their projects can deliver
- Bleed jobs from other local businesses and industries; positions where locals can be employed tend to be filled from the skilled labour pool of other sectors, such as tourism, manufacturing and agriculture
- Don't typically invest time and money training locals; instead they tend to bring their highly-trained, highly-skilled FIFO workforce to new projects
- Don't draw their labour requirements from the pool of unskilled, under-skilled or long-term unemployed in the area, so the effect on local unemployment is virtually nil
The fracking industry doesn't usually acquire private properties for their gasfields. Companies prefer to enter into contractual leases with landowners and pay them as little as possible for each well per year. Unlike the US, where landowners own the rights to minerals and resources on their land in many states, Australian landowners have no right to minerals or resources extracted from under their properties.
The level of compensation negotiated between landowners and gas companies varies considerably. Initial agreements can be relatively lucrative for 'early adopters', however, once the first landowner signs an access agreement, the bargaining position for owners of the surrounding properties can be reduced. This is one way the fracking industry divides local communities.
On the mainland, landowners are typically paid around $1500 - $5000 per well per year, although the amount varies greatly. Narelle Northdurft, who visited Tasmania in March 2015 to talk to politicians about her family's experience of living in the Tara gasfields of Queensland, receives $265 a year for each of the seven wells on her property.
The situation is a little brighter overseas. In the eastern states in the US, where some landowners own the mineral rights on their properties, companies pay a percentage of their profit in royalties to the landholder. Public support for fracking in the US is flat lining, though, as farmers and landowners see the long-terms devastation fracking is wreaking on their land. Public support for fracking is flat lining in the UK too, prompting gas companies to offer local communities direct financial incentives: £100,000 for hosting a test rig and a 1% share of the profits if a well goes into production.
Fracking or Fraccing?
Hydraulic fracturing is usually referred to as fracking. The oil and gas industry prefers the term 'fraccing'. We can only surmise that the use of the term 'fraccing' springs from a belief that changing the spelling will somehow persuade the public that 'fraccing' is less risky to their communities than 'fracking'. One certain advantage of using the term 'fraccing' is that it makes it easy to identify industry propaganda.