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Karoo fracking scandal exposed!

Ivo Vegter is a columnist and the author of Extreme Environment, a book on environmental exaggeration and how it harms emerging economies. He writes on this and many other matters, from the perspective of individual liberty and free markets.

At first, it seemed concerned environmentalists might have a point about Shell's plans to explore for deep shale gas in the Karoo. Everyone else believed them, and I too was inclined to give them the benefit of the doubt, reserving my opinion pending more reading on the subject. Closer inspection, however, revealed the green arguments about hydraulic fracturing to be riddled with cracks.

Lewis Pugh was rousing. He invoked Mandela and Gandhi and the brave people who fought and died for freedom. The propaganda was spectacular and alarming. There would be war over water, he warned, if we permit Shell to prospect for shale gas in the Karoo.

This is about our children’s future, and that of our children’s children, he preached. Shell is proposing to destroy our environment, he said, launching into stirring rhetoric about the ravages of global warming. Then he invoked the political tyrants being toppled in north Africa, and deftly juxtaposed “corporate tyranny” as if it’s the same thing.

It was grand oratory, concluding in Churchillian fashion with a call to arms and a vow to fight on, so “good will triumph over evil”. Yes, he actually used those words.

It was a slick performance, full of emotive appeal and rhetorical hyperbole. Dutifully, the mainstream media – whose sympathies I may have mentioned before –cheered this green David, standing up against the corporate Goliath.

But just because a little guy is facing up to a big guy doesn’t make the little guy right.

Even David, when he slew Goliath, was attacking a man whose only crime was defending his country from an aggressive invasion. When Goliath fell, and the Philistines fled before the marauding invaders, they were pursued and mercilessly killed. David’s only claim to virtue appears to have been that he was a little guy, backed by a big God.

Likewise, Pugh might strike a heroic pose, worthy of grand theatre. However, at the heart of his argument lies a false dichotomy.

He represents the Treasure the Karoo Action Group (TKAG), whose very name is meant to imply that treasuring this region is incompatible with permitting shale gas exploration. This is simply not true, and most of the claims advanced in opposition to Shell’s proposed exploration hold little water (if you’ll forgive the pun).

Let’s consider water, since this is a big part of the argument.

The TKAG claims that Shell’s exploration will require between 7.2 million and 144 million litres of water. Millions always sound like a lot, and that is undoubtedly why they chose not to use cubic metres, the more usual unit in which large-scale water use is measured. However, once you do the arithmetic, it turns out the worst-case scenario is a drop in the ocean compared to, for example, the projected water consumption of the Medupi power station, which at 14 million cubic metres is 100 times as much. Eskom as a whole consumes about 2,000 times what TKAG expects Shell to use for exploration. Eskom accounts for 1.5% of South Africa’s water use. Fully 75% goes to irrigation. Shell will hardly make any impact at all.

Still, energy companies are well aware of public sensitivity to such issues, and Shell has long since agreed to ensure it will not compete with local residents or farmers for water. If necessary, it will go as far as the sea to find water nobody else wants. It knows it cannot afford to give the public genuine cause for complaints, because the legal and regulatory implications would severely threaten its business.

A study commissioned for the TKAG from Haveman, a firm of “specialist energy attorneys”, tries to cite international precedent about the dangers of “hydraulic fracturing”.

It is a technique commonly used worldwide to extract shale gas or prolong the lives of oil and gas wells. For example, it is used extensively in gas fields in the Netherlands, underneath an extremely densely populated, environmentally conscious and highly regulated society. Worldwide, the precedent for fearing hydraulic fracturing is weak, at best.

Indeed, the Haveman report quite openly bemoans the “real paucity of information” about environmental or health impacts, and the “considerable uncertainty surrounding the environmental impacts of shale gas extraction”.

In short, they have no real evidence of negative effects. Witness recent testimony before Congress in the US.

“In recent months, the states have become aware of press reports and websites alleging that six states have documented over one thousand incidents of ground water contamination resulting from the practice of hydraulic fracturing,” submits Scott Kell, the president of the Ground Water Protection Council (GWPC). “Such reports are not accurate.

“Attached to my testimony are signed statements from state officials representing Ohio, Pennsylvania, New Mexico, Alabama, and Texas, responding to these allegations. As a result of our regulatory review and analysis, the GWPC concluded that state oil and gas regulations are adequately designed to directly protect water resources.”

In a report funded by the US Department of Energy, entitled Modern Shale Gas Development in the United States, A Primer, it wrote: “Ground water is protected during the shale gas fracturing process by a combination of the casing and cement that is installed when the well is drilled and the thousands of feet of rock between the fracture zone and any fresh or treatable aquifers.”

Ordinary boreholes are seldom more than 100m deep. Major water supply boreholes may go to 300m. Drinkable water aquifers may occur as deep as 500m, but below this, the water is typically brackish.

These shallow water supplies contrast starkly with typical shale gas operations at depths of 2,500m or more.

Yet the maker of a documentary that claims to show drinking water contamination as a result of hydraulic fracturing, Josh Fox, is unable to explain how exactly it occurs. “That target layers of fracking are far below underground drinking water sources was never contested by Gasland,” he admits. “We don’t know why fracking chemicals and fugitive natural gas are getting into water supplies, we just know that they are.”

Might that be because regulators are correct in their findings that methane contamination in water supplies in fact comes from decomposing biological matter at shallow depths, rather than from deep pockets of shale gas?
Fox further admits that contamination by shale gas has never been “proven”, claiming that this is because it has “never been investigated”.

Does this not seem odd, in a sophisticated and litigious place like the United States? And does it not seem odd that a raft of state officials are willing to put their signatures to Congressional testimony that says investigations were in fact conducted, whenever they received claims of damage or contamination after hydraulic fracturing?

Perhaps Fox doesn’t want to draw attention to these investigations, because whenever causes were found, even if they were related to oil or gas drilling activity, it turns out they were not related to the hydraulic fracturing process.

“After 25 years of investigating citizen complaints of contamination, [Ohio] geologists have not documented a single incident involving contamination of ground water attributed to hydraulic fracturing,” swore John Husted, head of the Division of Mineral Resources Management of Ohio.

“While we do currently list approximately 421 ground water contamination cases caused by pits and approximately an equal number caused by other contamination mechanisms, we have found no example of contamination of usable water where the cause was claimed to be hydraulic fracturing,” wrote Mark Fesmire, of the New Mexico Energy, Minerals, and Natural Resources Department.

“After review of [our] complaint database and interviews with regional staff that investigate groundwater contamination related to oil and gas activities, no groundwater pollution or disruption of underground sources of drinking water has been attributed to hydraulic fracturing of deep gas formations,” testified Joseph J. Lee Jr., head of the Source Protection Section of the Division of Water Use Planning of the Pennsylvania Department of Environmental Protection.

“I can state with authority that there have been no documented cases of drinking water contamination caused by such hydraulic fracturing operations in our State,” concurs David E Bolin, deputy director at the State Oil and Gas Board of Alabama.

“I sincerely hope that you [Scott Kell of the GWPC, in testifying before Congress] will clear up the misconception that there are ‘thousands’ of contamination cases in Texas and other states resulting from hydraulic fracturing. The Railroad Commission of Texas is the chief regulatory agency over oil and gas activities in this state. Though hydraulic fracturing has been used for over 50 years in Texas, our records do not indicate a single documented contamination case associated with hydraulic fracturing,” wrote Victor G Carrillo, chairman of that august body.

He is worth quoting further: “The Texas Groundwater Protection Committee (TGPC) tracks groundwater pollution in Texas. All Texas water protection agencies, including the Railroad Commission, are members. Each year, the TGPC publishes a Joint Groundwater Monitoring and Contamination Report. The 2007 report cites a total of 354 active groundwater cases attributed to oil and gas activity – this in a state with over 255,000 active oil and gas wells [11,000 of which use hydraulic fracturing]. The majority of these cases are associated with previous practices that are no longer allowed, or result from activity now prohibited by our existing regulations. A few cases were due to blowouts that primarily occur during drilling activity. Not one of these cases was caused by hydraulic fracturing activity.”

Colorado? Nada. Alaska? Nope. Kentucky, Louisiana, Colorado, South Dakota, Tennessee? Nothing.

According to Michigan’s Office of Geological Survey (OGS): “There is no indication that hydraulic fracturing has ever caused damage to ground water or other resources in Michigan. In fact, the OGS has never received a complaint or allegation that hydraulic fracturing has impacted groundwater in any way.”

Same thing in Indiana and Oklahoma: no harm was ever found to have resulted from hydraulic fracturing, because they had never even received any reports of such a thing.

Not one instance. Not a single one, over more than half a century, covering hundreds of thousands of wells.

Now one may grant that politicians and civil servants are open to corruption and simple incompetence. They may be under-resourced, or averse to attacking industrial interests that provide many jobs in their respective states.

However, it stretches credulity that having been asked such direct questions, they all either say that no allegations were ever made, or can produce reports of investigations that disproved hydraulic fracturing to be at fault. It is hard to believe that every single one of these people perjured themselves in regulatory statements or sworn testimony.

Yet either they all lied, or the hysteria about groundwater contamination caused by hydraulic fracturing is misplaced and there is some other explanation for what our intrepid film-maker admits he simply doesn’t know.

It is true that isolated incidents of pollution do occur. Some have been cited above. They do not, however, occur as a result of hydraulic fracturing, but in the normal course of drilling.

The exact same risks occur during one of the environmentalists’ favourite activities: carbon sequestration. The same goes for another fashionable green pursuit: geothermal energy. Why would it “destroy the environment” to permit drilling for shale gas, when drilling for other purposes is celebrated?

It is also true that the Karoo consists largely of unspoilt wilderness. If one (generously) concedes that such wilderness is worth preserving for its own sake, it should be noted that far from destroying the environment, as Pugh claims, the impact of drilling will be fairly minor in contrast with the vastness of this area.

Better yet, hydraulic fracturing reduces the usual impact of drilling, since multiple horizontal shafts can be drilled from a single vertical well, dramatically reducing the footprint of drilling operations on the surface. By that standard, hydraulic fracturing is the most environmentally friendly means of drilling and is perfectly suited to a relatively unspoilt wilderness such as the Karoo.

It seems that Pugh and the TKAG hold the radical and unrealistic view that even low-impact activities are taboo, and our lives and activity ought to have no impact on the environment at all.

To be fair, some of the concerns raised by green propaganda films such as Gasland merit holding exploration companies to high standards of responsibility and accountability. It is perfectly possible to mitigate the impact, minimise the risk, and ensure adequate recourse for any accidents that might occur. For that reason, environmental impact assessments and environmental management plans will be required of anyone who prospects for shale gas in the Karoo. All of this is reasonable, but none of this is what those who challenge shale gas exploration plans want.

The TKAG lobbyists should just be honest. It’s not hydraulic fracturing that annoys them. It is drilling for any oil, gas or coal that gets their goat. They have an ideological bias against fossil fuels, and will do anything, anywhere, for any reason, to stop fossil fuel exploitation.

Let’s return to the Haveman report, linked above. See point 16 on page 11. First, the hand-picked subject experts were asked to provide information under “very severe time constraints”. By contrast with this rush job, the US Environmental Protection Agency’s study will only produce preliminary results in late 2012.

To help them, even in the face of the aforementioned paucity of information, they were asked to respond “in accordance with” a predetermined set of arguments.

It is no surprise to find, then, to discover that this sham of a report, despite the rush and the lack of information, concludes exceptionally strongly: “The underlying argument of this Critical Review is that an immediate halt should be imposed on Shell’s application for an exploration right as well as on any other application for any other form of permit, right or authorisation that, if successful, may bring the advent of fracking in South Africa a step closer to fruition.”

It helps having your conclusions written before you draft the report itself. It is not honest, however, and it destroys the credibility of any valid concerns you might have raised. Why believe another word of what this bunch are peddling?

Regardless, the TKAG promptly ran with it, and now demands an outright ban even on any future exploration. It wants no discussion, no debate, no waiting for actual environmental impact assessments and environmental management reports, nothing. They want to make it illegal to drill for gas, finished and klaar.

Another spokesperson for the lobby group, Jonathan Deal, is quoted in MiningWeekly as saying that the “unsustainable nature of the resource” is the core concern. That contradicts the claim that it’s all about the perils of hydraulic fracturing, or the heavy demand on water.

If true, however, this merely means he disagrees with energy company investors about what resources are sustainable and profitably exploitable. In an open market, in which everyone enjoys the freedom Pugh so warmly extolled, Deal’s argument would be a perfect rationale for starting a competing wind or wave or solar outfit, and putting Shell out of business. It is not, however, a rationale to prevent Shell from pursuing potentially lucrative exploration.

A News24 columnist, Andreas Späth, makes the case clear: “Note to Shell: Even in the extremely unlikely event of you being able to convince us that you are capable of producing gas in the Karoo without wasting and polluting our water, we wouldn’t want you to. We don’t even want you to explore for it. We want you to leave the gas in the ground. The age of carbon-based fossil fuels – of coal, oil and natural gas – is coming to a close and until you propose to help us develop our abundant, clean, green and truly sustainable renewable energy sources, including solar and wind power, stay out of the Karoo.”

This preconceived goal must be why lobby groups like the TKAG think it’s okay to lie about the impact of hydraulic fracturing. The end justifies the means, and they can only rouse sufficient objection if people are terrified of the consequences of this nasty-sounding process, ominously called “fracking the Karoo”.

They aim to make it so expensive to drill for oil or gas that exploration companies will simply give up.

It’s true. They will. But here’s the problem with their view. These people aren’t harmless greenies, concerned only with pretty pictures of pristine landscapes and protecting endangered fluffy bunnies.

While they can afford expensive fuel and other such self-indulgent eco-luxury, most of us cannot. While they can wax lyrical about the age of fossil fuels being over, the rest of us depend for 95% of our electricity, and 100% of our transport, on fossil fuels.

Ordinary South Africans will feel the impacts in the rising price of food and transport, and in the number of us who are employed. When millions remain mired in poverty in South Africa, it isn’t harmless to lie about gas drilling. It is a cold and callous denial to people of their basic rights: to benefit from economic development.

Just the exploration phase of this project is said to be worth over a billion rand. This will create employment, raise GDP, increase tax income, and stimulate a great deal of secondary economic activity. Who knows how much wealth and employment might be created if the exploration proves successful, and the gas proves to be abundant?

It will reduce the cost and increase the supply of energy of a sort that South Africa undoubtedly needs, quite aside from the fact that it is cleaner than the dirty coal. It is ironic that no environmentalist seems to actually want to permit feasible alternatives to let us get away from our 95% dependence on coal at a price we can afford.

Who is this “we” that Späth talks about? Does it include the thousands of potential employees of a successful gas drilling operation? Does it include the consumers of electricity who, far from seeing abundance in his charming “clean, green” waffle, are faced with rolling blackouts and rising electricity prices?

When big industrial projects don’t come to South Africa, whether because of inadequate infrastructure or the obstructionism of angry greens, this harms the country in a very real way. The ecomentalists, with their 4x4s and bicycles and hemp hand bags and enough free time to organise petitions, protests and PR campaigns, might not care. However, millions of poor or unemployed people do.

Oh, and one other thing. Ditch the word “fracking”. It is a barbarous bastardisation of a perfectly good English term. Using it has only one purpose: spin.

It is designed to make people who don’t know better fear a perfectly ordinary industrial technique that has been in used safely and successfully around the world for many decades. It permits cute, but crude, phrases like “Fracking up the Karoo”. It should be beneath any self-respecting journalist.

One keeps hearing how Big Oil lobbyists are evil spinmeisters and insidious manipulators of public opinion. Don’t forget that Big Green lobbyists can deceive the public with the best of them.

Green subterfuge in this campaign is the real scandal about “fracking the Karoo”. DM


PS. I’m stepping back from this thread. Thanks for the many very many thought-provoking comments.

I started this column in earnest last Saturday morning. It was published on Wednesday morning, and it has taken up pretty much all my time since then. It is now Saturday again. It’s getting to the point where I’m repeating myself, and while I have a thick skin and do find the occasional smackdown entertaining, I’ve been getting unnecessarily crabby with all the personal insults (compounded by a few frankly disturbing emails). Apologies if I snapped at anyone who didn’t deserve it.

Here’s what I learnt. Besides for what I wrote about the green lobby’s extreme ends and dishonest means, an important cause of the problem and a serious obstacle to its fair resolution ends up being — who’d have thought it? — one of property rights. The nationalisation of mineral rights leaves Karoo farmers and residents at the mercy of government bureaucrats in this affair. If that had not happened, they would have had the right, through simple contract law, to lay down conditions and demand terms from gas prospecting companies, and to get compensated for any risk they believe exists or any damages they incur.

As I wrote to someone who told me I’m “provoking the people of the Karoo”, I know a few Karoo farmers, and have a deep respect for their work ethic, their love of the land, and their warm hospitality. Even if I didn’t, I’d support their property rights as a matter of principle. I don’t believe their rights are under threat from Shell, but I can’t say the same about the government. You can negotiate with another private property owner. You can’t negotiate with laws and guns.

My objection is to the environmentalists’ campaign, because I believe it to be dishonest and designed to whip up fear, anger and hysteria. Emotions are running high, but they’re no basis for rational business decisions or public policy making. My fight is with the green lobby, not with the people of the Karoo.


PPS. To all who’ve asked for it, I do intend to write a follow-up to this column.

There were hundreds of comments, a number of which contained claims and objections that merited a response. Responding to as many as possible was a gargantuan task. However, it is worth getting the most important of them together in a single place, and to better support some of the responses I did make. Also, I wish to reply in some detail to Andreas Späth’s response over on News24.

I’m working on that. I already know more about drilling wells than is really compatible with “having a life”. If history is any guide, my follow-ups tend to happen three or four weeks after the column that started the debate. I can’t promise when I’ll be ready to write this one, because it means going through enough material to fill a book. Literally. To put it in perspective, at the rate of one 500-word blog post per working day, it would take a year to write the amount that has been written on this page in one week. It’s been quite an astonishing week.


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