Article - Issue 52, Sep 2012

Shale Gas

Dr Rebecca Pool

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In the last decade, improved extraction techniques have made it more practicable and less costly to extract gas from shale deposits. The US is leading the exploitation of this new energy source and shale gas now supplies a quarter of that country’s needs. Yet the techniques used to extract it have come under intense scrutiny and, in some parts of the world, faced strong opposition. Ingenia looks at the historical and technical background of shale gas and the issues related to its extraction.

When mud is deeply buried, pressure over geological timescales changes it into a brittle type of sedimentary rock known as ‘shale’. Organic-rich shale is the source for most of the world’s petroleum. Shale is normally porous (contains pores that are full of fluid, oil, gas or water) and is normally of very low permeability (does not permit significant fluid flow). So shale has traditionally been regarded as a petroleum source rock, but not a reservoir. For a rock to serve as a reservoir, it needs both porosity (storage capacity) and permeability. This combination of properties is normally found in sandstone and limestone. Petroleum accumulations (both gas and liquid) in these rocks are termed ‘conventional’. Gas produced from shale is one of several ‘unconventional’ types of petroleum where the shale acts not only as the source but also the reservoir.

Shale gas reserves across the world. In the UK, the Bowland Basin is the key point of interest. Argentina, Chile, China
and Canada also hold promise for future shale gas operations © The Royal Society and the Royal Academy of Engineering

Shale gas reserves across the world. In the UK, the Bowland Basin is the key point of interest. Argentina, Chile, China and Canada also hold promise for future shale gas operations © The Royal Society and the Royal Academy of Engineering

In parts of the USA, gas has been produced from naturally fracked gas-charged shale for nearly 200years. In the last 20 years, rapid improvement in technology has led to a renaissance in shale gas production, which has moved from being a ‘cottage industry’ to being of national and international commercial significance.

There are three main areas where technology has impacted on shale gas production: drilling technology, hydraulic fracturing and seismic imaging. Directional drilling has improved as a result of the necessity of drilling many wells off a single offshore platform. Now it is possible to drill up to 20 wells off a single pad and to steer the drill bit with accuracy. Hydraulic fracturing (often termed ‘fracking’) has been used to increase the permeability of low permeability conventional reservoirs for over 40 years and the technology has rapidly improved in recent years. Seismic imaging now makes it possible to map the shale in 3D and identify the most productive formations or ‘sweet spots’.

In 1976, the US Department of Energy – always concerned to secure gas supplies, preferably indigenous ones – initiated a project to identify shale gas reserves. By the 1980s, sedimentary basins with rich shale gas reserves had been identified in New York State, Pennsylvania, Texas, Oklahoma, Ohio and Louisiana.

With the price of oil and gas rising steadily on the global market and significant new finds of conventional gas becoming less frequent, all the pieces were in place for a rapid expansion of the shale gas industry in the US. The change has been dramatic. Today in the US, over 1,000 rigs are being used to extract shale gas. The industry supports half a million jobs, provides more than a quarter of the country’s natural gas demand and has reduced domestic prices in the US to the levels of the 1970s.

Yet worldwide, despite a glut of gas caused by the recession, global prices for ‘conventional‘ gas remain high. That has sparked US interest in becoming an exporter – thought to be likely within five years, once it has built its export terminal capacity. But globally, the experience of the US has triggered interest in many countries in extracting their own shale gas.

China has been an early mover in investigating its potential. In Europe, too, countries are showing an interest. Poland, eager to relinquish ties with Russian gas and to reduce its heavy reliance on local coal, has led the European developers. Other countries – including the UK – are also exploring the possibilities. Worldwide, not all countries with potential reserves have followed the US example with France, South Africa and others imposing moratoria on shale gas extraction – even some US states have called a temporary halt to exploration.

These moratoria stem from controversies arising from the expansion of the industry. There are fears that the extraction process itself maybe unsafe and may lead to groundwater contamination and earthquakes – issues investigated in a recent report by the Royal Society and the Royal Academy of Engineering – see Shale gas extraction in the UK. The wider effect a shale gas industry might have on carbon emissions also remains unclear as does the impact it could have on national energy policies.

EXTRACTING SHALE GAS

The global interest in shale gas has put hydraulic fracturing into the news. It has been used for many decades, andof the 2,000 conventional wells drilled around the UK, some 200 have been artificially fractured without problems arising. PR Marriott, the drilling contractors for Cuadrilla, the only company that has undertaken shale gas exploration in the UK, outlines the exploratory drilling that has taken place on itssite in Lancashire, and how production would proceed if permitted.

Cuadrilla’s development of the site occurs over a number of successive phases. The first phase is exploratory, with the company drilling a small number of vertical wells to identify the number of shale formations, the depth and thickness of each formation and the concentration of gas in the rock. The aim of the exploration phase is to assess the economic viability of the location before moving on to the production phase.

Prior to any drilling operation, soil is excavated from the site and a rubber membrane laid across the entire area to protect the ground. The membrane is then backfilled with compacted material, ensuring a good base for the drilling and fracturing equipment to be sited. This initial preparation and careful management of the site are necessary to mitigate the risks of any spillages that could be a potential source of groundwater contamination.

Wells are typically drilled in three sections, with steel casings installed and cemented fully into place for each stage. This ensures that the well retains its integrity as drilling and then hydraulic fracturing proceeds. The well will typically travel through a shallow aquifer (normally only a few hundred metres deep) and down to the shale formation which will be much deeper, typically around 3,000 m. The purpose of the casing and cement is to isolate the shale formations where the fracking will take place from the aquifer and prevent any possible connection pathways along which contaminants could flow. The rig is removed from the site once the well has been drilled, core samples taken from each shale formation, and the well fully cased and cemented to surface.

The fracturing equipment is then installed and fracturing fluid (a mixture of water, sand and chemical additives – see What is in fracking fluid?) is injected down the inside of the steel casing under high pressure (at times over 600 bar for short periods) through a perforated section of the casing out into the shale. The shale formation contains microscopic fractures; injecting the fluid opens the fractures enough to release the gas and the sand in the fluid holds the fractures open to maintain the flow.

Once the fracturing is completed and the pressure released, a proportion of the fluid will flow back up to the surface along with ‘produced’ water released from the rock. This ‘flowback’ water contains a variety of contaminants and must be stored on site before either being reused in subsequent fracturing processes or disposed of safely. Any remaining fracturing fluid is then forced out from the well and the gas migrates back through the microfractures, up into the well bore and is collected at the surface.

If large enough volumes of shale gas can be extracted economically from the site, and, if governments permit, the exploration phase is complete and the production phase can begin. It is during the production phase that it becomes clear why new techniques in horizontal drilling are so important to this industry. Horizontal drilling allows a wide area to be accessed from a single site on the surface with up to 20 separate wells being drilled from a single ‘pad’. The well is drilled vertically to within 150 m of the shale, at which point it is deviated onto the horizontal plane and can be extended up to another 3,000 m. In a similar way to exploratory drilling, a perforating gun passes along the horizontal well section and fires charges by an electric current that forms holes along selected intervals of the well within the shale formation. Hydraulic fluids are then pumped down to release the natural gas as before.

SHALE GAS IN EUROPE

In Europe, it has become clear that there are a number of factors that will have an impact on future development. Professor Stevens from the Royal Institute of International Affairs (generally known as Chatham House) believes that public perception and community acceptance may delay future shale gas production across Europe. He set out some of the reasons in his report The ‘Shale Gas Revolution’: Hype and Reality.

Stevens says that the geology for shale gas in Europe is less promising than in the US. The deposits are deeper, basins are smaller and the shale beds are richer in clay, which makes hydraulic fracturing more difficult.

Current estimates tend to measure the amount of ‘gas-in-place’ but only by carrying out exploratory wells will it be possible to determine how much of that gas will be technically or economically recoverable.

The International Energy Agency estimates that European operators will need to drill around 800 wells every year to produce one trillion cubic feet of shale gas over 10 years. This would still only yield around 5% of total gas consumption in Europe – significant, but not “revolutionary”.

Rapid US progress also relied on an existing, massive onshore service industry; no such industry exists in Europe. As Stevens observes, in April 2010, there appeared to be only 100 land rigs in Western Europe, while by 2008 the US had 2,515active onshore rigs drilling for oil and gas.

There are also geographical differences. Europe is much more densely populated than the US, so large-scale hydraulic fracturing operations will affect local communities more. There will need to be extensive public consultation in the UK and gaining planning permission will be an important consideration.

In addition, the mineral rights in Europe differ from the US. There, the landowner owns the subsoil and receives revenues from the resources in it, but in most of Europe the state owns the subsoil rights and receives royalties. This gives residents fewer incentives to accept nearby drilling operations, though in the UK landowners can charge substantial sums for leasing land and permitting access.

Finally, European operations will be more expensive. Capital outlay aside, hydraulic fracturing in the US attracts tax credits; no such scheme exists in Europe. All these differences will result in drilling operations in Europe costing up to three times as much as in the US.

ENVIRONMENTAL CONCERNS

Technical and institutional barriers aside, shale gas extraction and the hydraulic fracturing technique in particular, have also raised alarm over environmental issues.

Earth tremors and groundwater contamination are generally seen as the biggest environmental issues. Cuadrilla’s project has already faced the issue of earth tremors. In April and May 2011, two small earthquakes of magnitude 2.3 and 1.5 were recorded close to the test site. Drilling operations were suspended immediately.

Six months later, Cuadrilla confirmed the tremors were “most likely” caused by its activities. But it and the Department of Climate Change (DECC) pointed out that the tremors of that magnitude were a regular occurrence in the UK and generally unnoticed by the public. They were also smaller than tremors caused in decades past when the area’s coal mines were active.

In its seismicity report, the company said that the tremors took place because there was an existing fault that could accept large volumes of fluid from the fracturing process and was induced to fail. DECC has agreed with its conclusions – and also with its further conclusions that future wells are unlikely to encounter a similar fault. It also concluded that actions such as draining drilling water after fracturing and the use of seismometers around the site to detect micro-seismic activity and give early warnings would be sufficient to allow exploration to continue.

Neither DECC nor the House of Commons Energy and Climate Change Committee – a cross- party group of MPs that scrutinises the Department’s work – have seen any need for a moratorium on shale gas, despite the tremors.

The Energy and Climate Change Committee concluded that the process does not pose a direct risk to water aquifers, provided the well is constructed properly. DECC noted that cases of contamination in the US have been the result of “some incompetent operators [who] have allowed gas to contaminate shallow [water] aquifers, which should not be possible with proper well casing design.” Other analysts concur, and point to a lack of regulation in the US that allowed these failures to occur.

The Chatham House report says that US shale gas operations have been “remarkably” free of the regulations that would apply in the UK. Professor Michael Stephenson of the British Geological Survey (BGS) believes that the problem lies in poor well design and construction, both of which are tightly regulated by the UK Health and Safety Executive.

The BGS is now auditing groundwater methane in potential production areas. As part of the study, geologists are determining the concentration of natural methane in groundwater, taken from water wells, to provide a baseline. This means that the BGS will be able, later, to determine if methane detected in groundwater after hydraulic fracturing is naturally occurring or has leaked from drilling wells.

Beyond the immediate concerns over earth tremors and groundwater contamination, wider environmental concerns are also important to consider. A fundamental question is how much greenhouse gas is emitted when extracting and using shale gas. Some have argued that indirect emissions via the relatively energy-intensive extraction process, coupled with fugitive emissions of methane – a global warming culprit with at least 20 times the impact of carbon dioxide – add up to a process more carbon-intensive than using coal. But most analysts conclude that, with careful management and control, emissions can be maintained at levels relatively close to conventional gas. This is one issue on which there is still much uncertainty and much better monitoring and analysis are required.

Valid or not, as the list of environmental issues grows, so will public debate. As Energy Minister Charles Hendry said after the Lancashire tremors: “[Shale gas] is a potentially important addition to our energy resources, but its development must be done in a way that carries public confidence.”

See Opinion piece on page 10 by Professor Nick Pidgeon

Dr Rebecca Pool talked to: Professor Paul Stevens, Senior Research Fellow (Energy) at Chatham House; Paul Matich, Well Services Manager, PR-Marriott; Professor Michael Stephenson, Head of Science (Energy) at the British Geological Survey. Additional material was supplied by Alan Walker, Senior Policy Advisor at the Royal Academy of Engineering.

Independent review of the risks associated with hydraulic fracturing report

Independent review of the risks associated with hydraulic fracturing report

SHALE GAS EXTRACTION IN THE UK

In late 2011, the UK Government’s Chief Scientific Adviser, Sir John Beddington HonFREng FRS, asked the Royal Society and the Royal Academy of Engineering to carry out an independent review of the risks associated with hydraulic fracturing. The report would inform government policymaking on shale gas extraction in the UK.

Led by Professor Robert Mair FREng FRS, the review examined the scientific and engineering evidence relating to the environmental and health and safety risks associated with the onshore extraction of shale gas. The report concluded that the practice could be undertaken safely as long as operational best practices were implemented and enforced through regulation. In coming to that conclusion, it found that:

- Hydraulic fracturing is an established technology that has been used by the oil and gas industries for many decades in the UK

- The risks of contamination of aquifers from fractures are very low provided that shale gas extraction takes place at depths of many hundreds of metres

- Seismicity (or earth tremors) induced by hydraulic fracturing is likely to be of a smaller magnitude than the UK naturally experiences, or than is related to coal mining activities, which are, of themselves, low by world standards

- Open ponds for storing wastewater (which have been historically used in US fracking operations and carry a possible risk of leakage) are not permitted in the UK and there are numerous facilities in the UK for the treatment of similar wastes from the industrial sector

- Well-established procedures have been developed for the disposal of naturally occurring radioactive materials (which are present in the hydraulic fracturing wastewaters) by the UK’s extractive industries.

A particular cause for concern is that that poor cementation and casing failures of wells could lead to leakages and wider environmental contamination, as they have in some cases in the US. The review concludes that the priority must be to ensure the integrity of every well throughout its lifetime.

Professor Mair said that much of the speculation around the safety of shale gas extraction followed examples of poor practice in the US. The compilers of the report found that well integrity is of key importance but the most common areas of concern, such as the causation of earthquakes with any significant impact or fractures reaching and contaminating drinking water, were very low risk. He said: “This is not to say hydraulic fracturing is completely risk-free. Strong regulation and robust monitoring systems must be put in place and best practice strictly enforced if the government is to give the go-ahead to further exploration.”

The assessment of systems of regulation in the UK and examples of best practice led to a number of recommendations in the report that should be implemented if shale gas extraction is to be undertaken safely in the UK. They included strengthening the UK’s regulators and giving a single regulator lead responsibility for the industry.

Professor Mair also said that this review was not an exhaustive analysis of all the issues associated with shale gas. A number of additional issues have been highlighted that merit further consideration, including the climate risks associated with the extraction and subsequent use of shale gas and the public acceptability of hydraulic fracturing.

The report is available at www.raeng.org.uk/shale

WHAT IS FRACKING FLUID

In addition to water, Cuadrilla also use a sand and a polyacrylamide friction reducer – each making up 0.4% and 0.01% on average of the total fracking fluid (again, figures will vary from location to location). All additives available to Cuadrilla for use have been approved by the Environment Agency and complete details of the composition of each of their fracturing jobs have been made available online.

The amount of water used in a typical fracturing operation will vary, according to the depth and geology of an individual well. In Cuadrilla’s Preese Hall well, the only well they have carried out fracturing operations on so far, they used between 800 and 2,300 m3of water during each of the fracturing operations. In developing a production site with several wells on the same site, it is possible to reuse the water flowed back from one well on another one, thus cutting the need to transport water.

In the US, the use of chemicals in fracking has caused concern. While most underground injections of chemicals have been subject to the protections of the Safe Drinking Water Act (SDWA), Congress modified the law in 2005 to exclude additives used in hydraulic fracturing. In the UK, drilling companies are required to gain approval from the Environment Agency for the additives they use.

 

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