In shale we trust

13th May 2013


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With government support rising for shale gas exploration, Paul Suff talks to Cuadrilla about how it is limiting the risks to local environments

In his recent budget statement, George Osborne declared: “Shale gas is part of the future. And we will make it happen.” Francis Egan, CEO at Cuadrilla Resources, the first company to explore reserves of shale gas in the UK, says he expects the 1,200km2 of Lancashire that his firm has a licence to drill – stretching from Fleetwood in the north to Southport in the south – to be home to up to 60 multi-well pads (sites containing about six separate wells) over the next 30 years.

“The pace of expansion will depend on government policy and the price of gas,” Egan told the environmentalist. “The economic case of shale gas is currently strong, though we still have to overcome safety and environmental concerns. But if all goes well in the UK, then there’s a good chance the industry will expand across Europe.”

Estimates from the gas sector indicate that around 10% of forecast reserves are recoverable, though some companies in the US, which has a highly developed shale gas industry, claim to be able to recover as much as 40%. Egan believes 10% is a realistic figure for the Bowland basin in Lancashire.

“That’s a conservative estimate,” he says, noting that advances in technology may make it possible to recover more shale gas in time. “The oil industry is going back to abandoned reservoirs in the North Sea because it now has the technology to extract more oil.”

He claims the shale gas reserves in Lancashire have a current market value of £136 billion.

Regulated activity

Drilling for shale gas involves both vertical and horizontal drilling, combined with hydraulic fracturing (or “fracking”) to open up gas deposits that have been locked away for millions of years in tightly bound shale rock formations. Hydraulic fracturing pumps water, sand and chemicals into the rock at high pressure to extract the gas.

The sand acts to prop open the fracture and let the gas flow, while the chemicals reduce friction between the water and pipe, clean the water to prevent bacteria clogging a fracture or break down any calcium to help create an initial gap. Fracking uses a significant amount of water – in Cuadrilla’s case, around 8 million litres for a full 10-stage fracture, up to 40% of which returns to the surface.

Once the drilling is completed, shale gas can flow for around 30 years with minimal disruption to the surrounding area, though well and pressure monitoring remains ongoing. The construction of the site and the drilling phase, however, raise several environmental concerns, specifically its potential to: contaminate groundwater and surface water with methane and chemicals; deplete local water supplies; trigger seismic activity; and disrupt habitats. And, like any extractive or industrial infrastructure, particularly one running 24 hours a day, there may be problems with noise and traffic movements, for example.

Cuadrilla’s operations in Lancashire – which are managed by its subsidiary Cuadrilla Bowland – are regulated by the Environment Agency and the Health and Safety Executive, under licences issued by Decc, with planning permission from the county council.

The agency is responsible for permitted activities, including the safe disposal of wastewater at a treatment works. Cuadrilla requires a permit for this so-called “flowback” fluid, because the quantities of naturally occurring minerals, such as sodium and chloride, mean they are likely to exceed limits imposed by schedule 23 of the Environmental Permitting (England and Wales) Regulations 2010. Hydraulic fracturing to exploit shale gas reserves is listed as an industrial activity involving naturally occurring radioactive materials, so a permit is necessary for the disposal of flowback fluid where radioactive substances are present.

Under the Water Resources Act 1991, a shale gas operator is required to notify the agency of its intention to drill a borehole and provide details of well construction and how it will protect groundwater. A permit is required if the agency believes groundwater is at risk. The chemicals used in fracking are also subject to regulation, although only those assessed by regulators as non-hazardous pollutants under the Groundwater Daughter Directive (2006/118/EC) are permissible.

In its guidance on regulating shale gas operations, the agency says it will adopt a risk-based approach, based on available evidence. “We do not apply a one-size-fits-all approach,” states the regulator. It expects operators to demonstrate that their proposed activities are not harmful to people or the environment, and says it will thoroughly inspect and monitor shale gas operations due to the “relative novelty” of the techniques deployed.

The agency reports that between March 2011 and January 2013 it made 16 visits to Cuadrilla’s Preese Hall site, for example, with seven spot checks to sample flowback fluids. A total of 18 further visits were made to Cuadrilla’s other Lancashire sites over the same period.

Poor air quality near shale gas wells is another cause for concern, although Tony Grayling, head of environmental policy at the Environment Agency, told the select committee on energy and climate change that the regulator was “not expecting big air quality implications”. However, the agency will require site operators to adopt “best available techniques” to manage shale gas emissions.

Traffic lights

Shale gas exploration in the UK got off to a rocky start. In May 2011, Cuadrilla’s operations at its Preese Hall site were suspended after two seismic tremors in the area. The subsequent investigation revealed that hydraulic fracturing had triggered the seismic activity, which measured 1.5 and 2.3 on the Richter scale.

Fluid injection at depths of 2–3km was ongoing at the site shortly before the earthquakes occurred, and research for Decc by experts at the British Geological Survey (BGS) concluded that the timing of the events, in conjunction with the fluid injection, suggests that they may be related. The BGS also noted that it is well established that fluid injection can induce small earthquakes, but says that typically, these are too small to be felt. “We would not expect earthquakes of these relatively small magnitudes to cause any damage,” it said.

Decc consequently imposed new controls on operators to mitigate the risk of seismic activity. These include mandatory risk assessments and action plans to address seismic risks. Operators will have to monitor activity and submit information to the energy department.

Cuadrilla plans to adopt a traffic light system, already used in the Netherlands and Germany, which will enable operations to be quickly shut down if data reveals unusual levels of seismic activity. A seismometer network at each well will provide the data and ensure seismicity is contained at levels that will not cause concern, according to the company. Egan says the data will allow the firm to adjust the injection volume and rate during the fracturing process to help prevent noticeable seismic activity.

The Bowland shale is more than 1.8km below the surface and extends to a depth of more than 3km. Each well will consist of multiple horizontal branches or “laterals” from the borehole, over a distance of 1km to 1.5km. Whereas fracturing each lateral in the US typically takes only a few hours, Cuadrilla’s traffic light system means the company plans to fracture in stages, working back along the lateral with each stage roughly 61metre apart.

“Halting the operation after every stage is unique to the UK,” explains Egan. “It will mean the fracturing process will take months rather than hours, but will enable us to do more checking.

“Hopefully, once we’ve demonstrated that there is no risk, we’ll be able to speed up the process.”

Water pollution

Water pollution is one of the major concerns associated with exploiting unconventional sources of gas through fracking. There have been several pollution incidents in the US, with local aquifers contaminated.

However, MPs on the energy and climate change committee in 2011 found no evidence that the fracking process poses a direct risk to underground water aquifers, provided the drilling well is properly constructed. Similarly, the Royal Society reported in 2012 that “upward flows of fluids from the zone of shale gas extraction to overlying aquifers via fractures ... is highly unlikely”.

The aquifer in the area that Cuadrilla is exploring is not used as a source of drinking water because of its high salinity. Nonetheless, Cuadrilla claims to be operating as if it was suitable for human consumption. “That doesn’t alter our strategy to protect groundwater,” says Egan.

Good well design is something he emphasises, reporting that Cuadrilla always has at least three layers of steel casing its wells, with sealed with cement. The steel casings – surface, intermediate and production – ensure there is no pathway between the fractures and aquifers, he maintains. Prior to drilling commencing, cement joints undergo pressure testing to ensure there is no leak and they are sufficiently strong to withstand the drilling operation.

The depth of the Bowland shale is also a factor in the low risk of operations polluting groundwater in the area. Typically, the aquifer is between 110m and 830m below the surface, while the shale tends to start at a depth of around 1.8km.

“The rock is almost a mile thick, which is unusual and differs from the US where it is generally only a couple of hundred feet thick,” says Egan. In addition, an impermeable layer of Manchester marls, with a density of around 110m, sits between the groundwater strata and the shale. “All our sites will have groundwater monitoring stations,” confirms Egan.

The fracturing fluid that Cuadrilla plans to use consists mostly of water (99.5%), with sand making up a further 0.45% of the mixture. The remainder is the chemical, polyacrylamide, which acts as a friction reducer. Egan confirms that the company also has clearance from the Environment Agency for biocide and hydrochloric acid, though it is unlikely to use them.

Egan describes the Bowland shale gas as “very clean” – 98% methane, with no CO2 or the highly toxic and flammable hydrogen sulphide, for example. “That makes processing the gas fairly straightforward, as we only have to separate out the flowback fluid,” he explains.

Between 20% and 40% of the fluid will flow back to the surface, where Cuadrilla will store it initially in double-skinned tanks before lorries transport it to a wastewater treatment plant. Egan says all Cuadrilla sites, which cover an area of around 1.5 hectares, have an impermeable base, followed by a layer of hardcore to protect the surrounding area from pollution. There are also ditches to collect rainwater and any fluid accidentally spilled at the site, during the transfer of wastewater into tankers, for example.

Cuadrilla aims to eventually follow the example of the US shale gas industry and recycle the flowback fluid in its operations. That would require a change in how the water is classified by the Environment Agency, which currently views it as waste. “As the industry develops in the UK, that definition is likely to change, so we’ll be able to treat flowback fluid and reinject it. That’s the way forward,” says Egan.

United Utilities supplies Cuadrilla with water for its operations in Lancashire from the mains supply. This has an important advantage for Cuadrilla, explains Egan. “The water has already been treated by the supplier, so we don’t have to use many chemicals.”

Just another industrial process?

Many of the safety principles underpinning shale gas exploration and extraction, such as the need for good well construction and monitoring systems, mimic those widely employed in the recovery of conventional gas and oil. “Providing you construct the well properly there shouldn’t be any problems,” says Egan.

The industry differs in other ways, however, which potentially makes it less risky than other extractive operations. The gas flow rate of a typical sandstone gas reservoir is 200–300 million cubic feet a day. The equivalent daily rate for a shale gas well is 5–6 million cubic feet.

“That’s why you need to drill more than one or two boreholes; to get the gas out,” explains Egan. He also says the relatively low flow of gas significantly reduces the risk of a Deepwater Horizon or Piper Alpha scale blowout. “The risk is simply not there,” he says.

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