Shale Exploration Could Be Allowed Under Liberal Gov’t

12 09 2014
Election Drilling wells, shale exploration could be allowed under Grits

SAINT JOHN • A Liberal moratorium on hydraulic fracturing could still allow shale gas companies to drill wells and continue with exploration programs as long as it didn’t involve the controversial practice.   

The moratorium is strictly related to the process of drilling and injecting fluid into the ground at a high pressure in order to fracture shale rocks the party has confirmed. 

That also signals that seismic testing would be allowed to continue in New Brunswick under the Liberals.

Liberal Leader Brian Gallant was questioned on Thursday about the fate of existing shale gas company leases if his party takes power later this month.

Progressive Conservative Leader David Alward has charged that a move to block companies that have spent millions on work to date in the province is “irresponsible,” labelling Gallant’s stance unclear.

New Democrat Leader Dominic Cardy said a moratorium should include the cancellation of exploration permits, but added that lawsuits against the government are then possible.

Gallant has repeatedly said a Liberal government would institute a moratorium on the controversial technique to extract natural gas.

But when asked specifically Thursday if exploration work should go ahead, he simply restated the Liberal position on hydraulic fracturing.

“We have made it very clear over the last three years that there would be a moratorium on hydraulic fracturing under a Liberal government until we fully understand the risk to our water,environment,and our health”Gallant said.

Asked to clarify what happens to existing exploration permits under Liberal government, Gallant delivered a similar answer.

“We have made it very clear there will be a moratorium on hydraulic fracturing for all operations”he said.

Asked in a second followup question if those exploration permits would be cancelled, Gallant responded,“All operations will have a moratorium on hydraulic fracturing.”

Gallant was not made available to clarify his response.

The leader’s communication spokeswoman Jennifer Gillespie later provided a statement.

“The moratorium would apply to hydraulic fracturing,”she said.

But other shale gas extraction techniques are not necessarily subject to that ban.“We’re not privy to all the techniques that are being used by companies,” Gillespie said in an email. “If their techniques are proven to be safe, they could be permitted.

“But hydraulic fracturing would not be permitted until we are convinced that it can be done safely, without harm to our water and environment.”

The Liberal platform states that the party would impose a moratorium “on hydraulic fracturing until risks to the environment, health and water are fully understood.”

“… Any decision on hydraulic fracturing will be based on peer-reviewed scientific evidence and follow recommendations of the chief medical officer of health”it reads.

It then states the controversial extraction technique will not be permitted unless “extensive public consultations are held to determine if there is a social consensus,”among other conditions.

But that doesn’t address whether shale gas companies can continue to explore for the natural resource as long as they don’t engage in hydraulically fracturing wells.

“It’s irresponsible in terms of impacts on companies in New Brunswick” Alward said on Thursday. “Does his moratorium mean that he will close down the 30 existing wells of Corridor and the other work that Corridor wants to do in New Brunswick?

“Does his moratorium mean that he will tear up the contracts of SWN and the exploration work that they have done and the next steps of exploratory wells in New Brunswick?”

Alward added: “The reality is that Mr. Gallant has been the one that is the least clear.”   The Progressive Conservative leader added that the government has done its due diligence.

“The reality is that we have taken two years as a government to look at the existing regulations,to look at existing processes, and build what can be confirmed as the strongest regulations in North America”   Cardy says the moratorium should include cancellation of exploration permits.

He acknowledged firms that had previously been granted permission to drill, and which had already invested heavily in the province,could threaten to sue the provincial government if a moratorium were put in place.

“There might be a lawsuit,” Cardy said.“But I think with the two-year process we’ve proposed, putting a pause on the issue and then going through the independent analysis by the Human Health and Environmental Protection Agency to decide whether development can happen safely or profitably for the people of the province, if they go through that and the answer is actually ‘yes’ then they’ll have a mandate to carry out their operations. If the agency we have proposed says ‘no,’well, that speaks for itself.”

Cardy said he was betting any company that had invested millions of dollars wouldn’t step away if it had to wait a couple of years to resume drilling.

“We need to take all of the emotion out of this subject. Put this in the hands of scientists and people who actually know what they are talking about, and if the people who are opposed to fracking – and I don’t necessarily think it’s a good idea for the province – if they are right, the science will prove that. And if the companies are right, the science will prove their positions. So let’s not be afraid of facts and science, let’s make our decision based on those things rather than yelling at each other about it.”

In April, exploration manager Chad Peters said SWN Resources doesn’t have any solid plans or a timeline for when it may perform hydraulic fracturing in New Brunswick.

While the company remains committed to its exploration program in New Brunswick, actual field work isn’t scheduled to continue until 2015.

The company has made requests to drill test wells in four locations.   There are two drilling locations in Queen’s County, on Crown land in the Pangburn and Bronson areas. There are two others in Kent County, one in Lower Saint-Charles and the other in the Galloway area.

Peters was unavailable to comment on Thursday.   Corridor states that it and its partners have spent roughly $500 million in New Brunswick to date through capital investment, operating expenses, royalties and taxes in order to identify the commercial potential of the province’s shale gas resources.

It spent $25 million this summer to further develop its shale gas reserves in the province and is close to moving on a $150-million project that would see the company drill a series of new wells in an effort to bring its operations to full commercialization.   Those wells would be hydraulically fractured.

Phillip Knoll, outgoing president and CEO of Corridor Resources, declined to comment on Thursday in regards to what a moratorium would mean for the company.   – With files from John Chilibeck and Shawn Berry




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