Being Forthright with Fracking Facts and Fiction

Activist investors recently targeted two major U.S. oil companies over the practice of hydraulic fracturing.

Proposals calling more disclosure about the environmental risks of extracting unconventional resources through hydraulic fracturing were brought to the floor of annual shareholder meetings of both Exxon Mobil and Chevron Corp.

The proposals for more transparency received 28.2 per cent of the vote at ExxonMobil’s meeting and 41 per cent of the vote at the Chevron meeting. These are hardly insignificant numbers and perhaps a watershed moment for the unconventional resource industry.

Those who voted in favour of the proposals can not be dismissed as rabid environmentalists seeking an issue to do battle with corporations. These were reasoned institutional investors, concerned about the potential risk and liability that hydraulic fracturing may pose.

In the United States, the shale gas industry has historically responded to criticism and concerns about shale gas extraction by ignoring, deflecting and blaming.

One really must wonder what the public relations geniuses are thinking of when in the midst of reports about methane gas leaking into well water, the Marcellus Shale Coalition responds with an email blast about the positive impact of shale gas drilling on local employment.

The total sum of the industry response has created a public relations blunder that even shale gas opponents would have difficulty in engineering.

Shale opponents however are no better:  Josh Fox, the director of Gasland, the documentary, which elevated hydraulic fracturing into public view, has admitted that he withheld evidence that showed gas can occur in water naturally and is not a result of fracking.  The recent Cornell shale gas study has drawn criticism directed at its authors, methodology and its conclusions, which both scientists and industry groups say is flawed.

All industrial processes carry risk, whether it be to the employees undertaking the activities or the surrounding environment.

However, transparency is critical in helping measure risk in determining whether that activity should or should not be undertaken in a specific jurisdiction.

Industry and the general public is better served with more transparency and better environmental standards and regulation around the processes involved in shale gas extraction.

Yes, costs will likely increase and the pace of shale gas development will likely slow,  but the alternative is moratoriums (New York, Quebec and France) and most importantly, a lost opportunity in terms of cleaner energy, energy security and for some nations, a shift in geopolitical power.