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http://www.multimedia.ethz.ch/lectures/mtec/2011/spring/351-0514-00L

ESSAY: SHALE GAS IN EUROPE

The last findings of shale gas in UK as well as the well-known reserves in Poland, Germany, France and other European countries bring in the limelight the discussion about the exploitation of unconventional natural gas in Europe. The exploitation of unconventional gas has advantages and disadvantages but up to know remains weakly regulated. The uncertainness in the predictions on the well sizes, the challenging extraction technology and the need for further environmental impact assessment avoid finding a common agreement among the member states.

Introduction

Shale gas is a non-conventional gas that in the recent past is catching the attention of the energy markets. Shale gas is still a natural gas, but it is trapped in sedimentary layers with low permeability or porosity and requires special extraction methods, including horizontal drilling over long distances and artificial manufacturing of the parent rock.

These deposits are rather well distributed geographically, but today they are only best known and exploited in USA, whose production already accounts for 12%. Some predictions foresee that world reserves may represent more than four times conventional gas resources and in Europe new and large reserves in UK and Poland, as well as other much more smaller in southern France, Germany, Hungary, and Turkey were found. However, in Europe the feasibility of the exploitation, the economic benefits and the environmental costs of shale gas are still open questions and the main targets of this essay.

Shale gas properties and technology of the extraction

Two main obstacles for the exploitation of shale gas in Europe are the business model and the environmental impacts. The European reserves are well spread out and the exploitation would require a large number of boreholes which means high environmental impacts in the regions where the reserves are located. Moreover, these platforms require a large land space to be operated that seems to be an additional disadvantage due to the high population concentration in Europe.

From the technological point of view, the extraction of the European shale gas is much more challenging. Shale gas is extracted using a hydraulic process where water and chemicals are injected at high pressure into a well to fracture rocks and release trapped gas. Typically the area that should be drilled before finding the well is quite large. This means that a greater number of wells are required compared to conventional gas production and consequently that the costs of the extraction are much higher. Extraction rates and cost of production depend on a range of factors such as the quality of the area to be drilled, the technology used and the quality of the operator. For example, the production is higher if the area is dried, the horizontal drilling extends further out, the well is not deep or the operator is efficient.

Global gas prices play an important role in determining the economics and hence, overall levels of unconventional gas production. Estimations foresee that European extraction and production costs will be higher than those of other gas supply sources and that the shale gas is unlikely to make a significant contribution in meeting gas demand in UK by 2020 although other European countries, as it is the case of Poland that has the potential to produce larger amounts of gas.

Apart from the economic restrictions (commented below) other factors can limit the development of shale gas in Europe:

- the availability of the gas sites that can be found in protected areas

- the geology of the sites, that are deeper and further away than those in USA

- the lack of a flexible, ready available sector in Europe to support shale gas operators

- the local opposition concerning the impacts of drilling on the local community and in particular concerning the contamination of ground water

- the water scarcity in the drilling site where water should be injected and the environmental restrictions

- the higher concentration of the population in Europe making impossible the model of multi-spot drilling

- the difficulties in transportation to market as the amount of gas to be delivered would increase notably into the pipelines. One solution is the generation of electricity where the gas is produced and transmitted as electricity

Environmental impacts

The environmental impact of the shale gas should be assessed through a LCA method. An LCA assessment estimates and evaluates the environmental impacts of a product in each of the product's phases. The product's phases for the shale gas consist in the extraction, production, distribution and use phases.

The whole life-cycle of the shale gas is characterized by unavoidable environmental impacts. Firstly, the shale gas extraction is a high land occupation due to drilling facilities, equipment, gas processing and transportation facilities. Secondly, there are major environmental impacts due to the air emissions of pollutants, groundwater contamination due to uncontrolled gas or fluid flows due to blowouts or spills, leaking fracturing gludi, and uncontrolled waste water discharge. Fracturing fluids content hazardous substances, and flow-back in addition contains heavy metals and radioactive materials form the deposit.

The fugitive emissions form hydraulic fracturing processes can have a huge impact in the GHG balance. Existing data consider that the emission of methane from shale gas relative to its energy content are as low as those of conventional gas transported over long distances or as high as those of hard coal over the entire life cycle from extraction to combustion. Moreover, the methane intrusions of aquifers are not yet assessed but if considered, the GHG emissions along the entire fuel chain are expected to be higher than coal and oil.

Results are communicating by using several indicators. In each selection one weighting is followed and consequently slightly different results can be obtained. Carbon footprint is one indicator based on the emission of CO2 and compounds based on carbon that are released to the atmosphere. There are several equivalences to account the environmental damage of the emission of others gases different from CO2 and it is especially useful to evaluate the environmental friendliness of fossil fuels. In this sense, several authors reported that if methane leakages from hydraulic fracturing are including, along with emissions from forest clearing and water transport the carbon footprint of shale gas is slightly worse than coal. However, these results depend on multiple parameters and further investigations are needed.

The substitution of coal by shale gas seems not to have no obvious potential in terms of environmental benefits. The latter may occur in the case of more strongly polluting fossil resources, notable coal and oil and in the case that shale gas extraction proves to have lower environmental impacts.

Economic impacts

As commented in the introduction, there are several important reserves in Europe that, for the better and worse, are seen as a new era for the European gas market. These findings came across with the inauguration of the Nord Stream pipeline that takes natural gas directly from Russia to Germany under the Baltic Sea and bypassing Ukraine, Poland and the Baltic States and consequently bypassing the disputes that have periodically halted the flow of Russian gas to the rest of Europe.

Depending on the resources, the estimated amount of shale gas can play a more or less significant role in the European gas market. Drilling for shale gas is controversial, especially from the ecological point of view and the fear to cause subsidence and contaminates ground water. The technique, anyway, is only in the past decade that it has become economically and technologically viable and today there is a fear that new, and exploitable, supplies of gas could reduce prices to the point where investment in alternative cleaner energy sources, such as renewable sources does not make economic sense.

Poland's shale gas

The resources discovered in the recent past in Poland are estimated to be enough for the next 300 year Polish domestic consumption and seem to be the largest ones in Europe. Poland is in the side of the shale gas exploitation and it is regarded as the chance to turn Poland and to a less extent Europe partially independence from the gas producers countries such as Russian or the Golf region. Becoming partially independent and especially in the Western Europe would bring the Russia's business model into question. This change has to an extent already starting. Almost without anyone noticing, the European gas market has been changing, not in Russians favor. When Ukraine stopped the flow of Russian gas westward in the winter 2009, a combination of existing European contingency and emergency plans were set up. Britain has now a terminal for LNG and reduced demand for imported gas in the US; thanks to the development of shale gas there, has increased stocks of LNG for delivery elsewhere. The opening of Nord Stream adds a further dimension, with the potential to increase reliability of supplies and keep prices down, can be seen as enhancing Europe's security. This combination can hardly be welcome to Gasprom as it could force lower prices and fewer customers.

However, although the exploitation of the polish shale gas can bring some benefits there are some barriers to be overcome, especially if compared to the shale gas production in US. In this sense, large shale gas resources do not necessarily mean large scale production due to technical and economic factors. Assuming large scale productions, the overall gas supply will increase, which can have a similar effect that the discovery of large amounts of conventional gas reserves, having similar impacts of the policies.

This fact has already had a large effect on global European and US gas prices. Although it is difficult to isolate the impact of increasing shale production on global gas prices from other factors such as demand reduction due to the recession, the promotion of renewable energy resources and/or the increase in LNG liquefaction capacity, it is likely to have played a role in reducing gas prices. In addition it is likely to have an impact on the policies to secure the gas supply although it is not certain due to the high energy demand from developing countries, such as China and India. Finally, it will be necessary new regulations, particularly environmental ones concerning the usage and disposal of water, that may be delayed the production of shale gas in Europe.

UK's shale gas

As commented previously, depending on the estimations of the size of the wells shale gas, the impact on the gas market would be significantly different, at least in the near future. As shown in this essay, the positions of the countries owing shale gas reserves are considerably different and it is partially due to the uncertainty over the likely levels of unconventional gas production.

UK's shale gas estimations are considered to be large enough to cover the British domestic consumption for the next 19years. This fact means that British shale gas production will not avoid the natural gas dependence and consequently these findings are not seen as a solution to become more independent. However, the question now is what these findings can have an impact on the renewable energy sector. Recently UK government prioritized the investments on nuclear and renewable energy sources, but the investments in renewable are not stable. Offshore wind is expensive and returns are only achieved in long term. The exploitation of shale gas can make investments on gas facilities much more attractive shifting the current investments from renewable to gas sources stopping its development.

Policy

The current policy tools do not cover properly the specific risks of hydraulic fracturing. Therefore, the development of a coherent and strict European legislation, before allowing the extraction of these wells is highly recommendable. Nine major gaps can be identified:

1.      Lack of a mining framewok directive

2.      Insufficient threshold in the environmental impact assessment directive for NG extraction

3.      Declaration of hazardous materials not mandatory

4.      Approval of chemicals remaining in the ground not required

5.      No BREF on hydraulic fracturing

6.      The waste water treatment requirements are insufficiently defined, and the capacities of water processing facilities are probably insufficient if underground injection and disposal is to be banned

7.      Insufficient public participation in decision-making at regional level

8.      Effectiveness of water framework directive insufficient

9.      LCA not mandatory

Discussion

More general questions of shale gas production is framed in geopolitical issues. Should Europe import natural gas or should we develop these new types of operations? Nowadays, there is no a general agreement on the European shale gas exploitation. On one hand, some voices raise in favor of developing these new technologies as the possibility may have a significant impact on the dominant position held by certain oil and gas producing countries, particularly in the Golf region and Russia.

On the other hand, the environmental impacts of the extraction is relative high in comparison to other fossil fuels and the low social acceptance and economic considerations make the extraction of shale gas to be thoroughly evaluated.

A decrease in the gas prices, caused by the higher amount available in the European market, can increase  the demand of this energy source increasing, consequently, the GHG emissions and compromising the European objectives by 2020 (20% reduction of GHG emissions). In addition, the decrease in the gas prices can shift current investments on renewable energies towards gas investment decelerating the development of these technologies and postponing their implementation in our society

But over the long term, despite the unfavorable environmental impact assessments related to the exploitation of this unconventional gas, the constantly rising demand for energy, the persistence of tensions related to security of supply and the geographic distribution of the deposits all but ensure that these reserves will be extracted.

Conclusions

Shale gas extraction and production is becoming an issue of concern in Europe. The last news about the new reservoir discovered in UK and the technologic advances that made the extraction and production of shale gas possible bring into question the future European gas market.

Shale gas is characterized by higher environmental impacts than other fossil fuels, due to the land use, the use of chemicals for the extraction, the location of the reservoirs and the cracking produced in the soils. Ground water contamination is the main fear of this technology.

However, the opportunities that the shale gas exploitation brings to ensure, at least until a certain extent, the energy security in supply in Europe and to decrease the gas prices are the main driving forces that ensure that these reserves will be commercialized.

Sources

Publications parliament of UK 20/01/2011

Impacts of sale gas and shale oil extraction on the environment and on human health

Independent: Poland's shale gas dilemma for Europe 27/09/2011

Other news published at EU level: ENDS, European voice, etc…

 

CIUDADANA...... DE DONDE??

Venir a la ciudad que me vio nacer siempre desordena mis ideas y tal vez es por eso que la frecuento tan poquito… esta vez no podía ser de otra manera. Aterrice el mismísimo día del Pilar a horas en las cuales la mayoría de la duplicada población de la ciudad aun no se había acostado y/o retirado a sus casas para vestirse con el traje típico y salir de nuevo a la calle. Este año fue una excepción para mi por dos razones, la primera estaba en casa en un día, supuestamente, tan especial para nosotros después de unos 4 o 5 años y la segunda no me iba a poner ninguno de los trajes que siguen magníficamente colgados en el armario… pero lo que de verdad me llamo la atención, es que no solo no echaba de menos el traje baturra sino que me sentía como una extranjera en mi propia ciudad!!!  Cosa que se dio cuenta hasta la funcionaria de correos al solicitar mi papeleta de voto de correo y recordarme como si fuera lo mas normal del mundo que "tu hija mía de algún sitio serás, no??"

La cosa no paro allí, sino que fue a peor con el transcurso del tiempo…. La brevedad de mi estancia me obliga a quedar de manera acelerada con mis diferentes grupos de amigos: del colegio primario, universidad, de la familia, de actividades de ocio, etc.… este cambio de personajes actualizándote su vida en pocos segundos e intentando analizar la información recibida en micromilésimas de segundo me pone los pelos de punta… lo peor de todo viene cuando en el transfondo de la conversación se entrevé el abismo que existe entre sus progresos (se casan, tienen niños, tienen niños, tienen niños… de 3 a 0 años y en camino los tenemos de todos los gustos y colores!!!!) y el estancamiento de mi vida…. y ya, para rematar la faena llega el típico consejo de "tienes que venirte a tu tierra para asentar la cabeza: formar una familia"…. Ufff, si tu supieras que ya no se cual es mi tierra….

Eso si, donde me he sentido identificada ha sido en la manifestación de "los indignados"  Triste verdad?? Pero parece que la indignación es uno de los pocos sentimientos comunes a todos, independientemente de tu origen o lugar de residencia…. parece entonces, que a lo mejor a lo que nos estamos enfrentando es un problema global donde deberiamos tener una sociedad global y donde no merece la pena tener un sentimiento de pertenencia a un región, sino simplemente ganas de mejorar nuestra situación, que es parecida a la de todos los demas… ufff, quién diría que yo, que soy totalmente contraria a la globalización por lo insostenible que es y todos los impactos medioambientales que causa, iba a pasarseme este pensamiento por mi cabecita llena de pajaros... y llegar a sentirme más identificada con ser una ciudadana del mundo que de algún sitio concreto…. Aysss, si al final J.M. iba a llevar razón!!! ;-))