European Shale Gas and Oil Summit 2015 - Engagement and National Leadership

European Shale Gas and Oil Summit - Day 2.

We know what the PM thinks about shale gas.

Almost everyone I speak to tells me that they would like to have, but do not have, trusted independent advice that enable them to make an informed decision about shale gas - about whether we need it and about the risks and advantages that come with it.

• The industry tries to tell people - but they are not trusted - too many hands in the till.
• Environmental NGOs try to tell people - but they are not trusted - too much passion and not enough basic sense.
• Local planning officers and civil servants (e.g., employees of the Environmental Agency) would love to tell people, but they are not allowed to.
• Scientists are unbiased (on the whole), expert and would like to tell people, but they have no independent funding and no platform.
• The media are more interested in drama than informing people about important things.
• Government does not try.

Where is the leadership?

People tell me that they would like:

• Direction from the top.
• More political endorsement with reasons why!
• Single point, transparent regulatory accountability that has teeth.
• An unambiguous guide to best practice.

Then they can feel comfortable about making an informed decision. Until then the default position is the status quo, which will ultimately lead to electricity outages, ministers over-ruling planning decisions and an erosion of a local say in local planning.

OUGO is the governments Office for Unconventional Gas and Oil, commonly called OffUGO!. It sits within the Department of Energy and Climate Change’s Energy Development Unit and tells us that it is part of a Unit which is responsible for encouraging and overseeing energy development in the UK. OffUGO has a number of remits. One is to 'Support Public Engagement'. Yet I do not know what they have done in this sphere recently, and I doubt whether many readers of this blog have heard of them.

Leadership - erm...

European Shale Gas and Oil Summit 2015 - Engagement and Local Opinion

Reporting from the European Shale Gas and Oil Summit 2015 - Day 2.

Yesterday there was great interest in a workshop concerned with trying to find what needs to be said about onshore oil and gas, and how and by whom (although not explicitly to whom!) Maybe that last omission was because it is so obvious - I hope so.

The points were made that shale gas engagement (usually opposition, but not necessarily so) is limited to the super local. That does not mean Councillor Joanne Bloggs who changes into the clothes of a super anti-fracking heroine behind the bike-sheds, but geographically. That is, opposition to a development is constrained to those very near the proposed development. For those living a few miles away, the issue feel remote, and remoteness in time also soothes the savage breast (after all the modern world gives us all lots of other stuff to worry about every day).

BritainThinks (vox pop out of the box) tells us that when people in a prospective shale gas area are asked what bothers them, shale gas is rarely mentioned spontaneously - jobs, housing and welfare are all to the forefront. Ironically, these are all things that the government says will benefit from shale gas development.

BritainThinks reports that their respondents:
1. Have no sense of the need for shale gas - the drivers.
2. Do not know where the government stands - despite Cameron's unquestioning support.
3. Do not know what the real risks and hazards in the UK are (although they are often expert in the reported hazards in the USA)

Overall, the UK is a nation of people for whom the advantages and risks of shale gas is nebulous at best.

Locals want to hear from people 'without their skin in the game', and scientists are by far the most trusted. Yet when did you last hear from one of us about shale gas. We have no funding to market our expertise, and if there was funding, it would have to be independent.

When did you last see a scientist on the BBC (other global news groups are available!) talking about shale gas. They 'balance' a panellist from industry with one diametrically opposed from an environmental NGO, which results is much drama but little communication of information and ideas to real people.

Oh, and by the way - there were no journalists apparent in the Public Engagement Workshop at the Summit here - Odd that, since the BBC has sent delegates!

European Shale Gas and Oil Summit 2015 - Public Engagement and Planning

So here we are at the European Shale Gas and Oil Summit in Manchester. The mood seems fairly upbeat despite, for example, the recommendation for a five year moratorium that was voted through by Ryedale District Council at their October 8th council meeting. The Ryedale District Council, however, have only an advisory role and it will be interesting to see what weight Yorkshire County Council will give it.

One of the big themes that is being taken extremely seriously is what they call 'Engagement'. In other words, how to keep everyone fully informed about everything. The extent to which the Industry takes this seriously is quite frightening, especially as they are often accused of exactly the opposite. Certainly communications mistakes have been made in the past by them, but they seem to want to learn and do much better.

The local planning officers and civil servants report a massive need for information from the general public, but complain of two things. The first is that they are constrained by their jobs to only comment on the planning process even though many are experts in onshore hydrocarbon resources. The second is that the planning process has to occur within 13 weeks and that does not give enough time for the issues to be properly considered. One officer told me that there is a concern that the short planning permission judging cycle and the costs of a review of their decisions if they reject a planning proposal may lead to some proposals being passed when they should have greater scrutiny. Another that George Osborne's recent gift of business rates to local councils may act as a temptation for the more unprofessional local politicians to support shale gas development when the law requires that the planning process is independent of political influence.

Issue 3. Shale gas exploitation will provide jobs and stimulate the economy

Yes on both counts. 

On the 19th of July 2014 the Chancellor George Osbourne said:

“I want Britain to be a leader of the shale gas revolution – because it has the potential to create thousands of jobs and keep energy bills low for millions of people.”

There is no doubt that shale gas will provide a boost for jobs. It has been pointed out that currently there are insufficient rigs and trained workers to exploit Europe’s shale gas resources. However, that will change in accordance with market pressure. Although the oil and gas industry is global, using expertise that travels around the world routinely, most of the new jobs will be sourced within the UK.

Estimates of the new job numbers are difficult to calculate. However, a detailed study by the Institute of Directors recently concluded (Infrastructure for Business: Getting shale gas working, 2014, full report, summary report) that investment (capex and opex) could reach £3.7 billion a year, supporting 74,000 jobs. These jobs would include geologists, engineers, construction workers, business analysts, truck drivers and public relations staff as examples of the people needed by the industry directly. There would also be jobs in the supporting industries, including in cement and steel manufacturers, equipment manufacturers, drilling services companies and water treatment specialists, which form important parts of the supply chain. Furthermore, there would also be a positive impact on local jobs and a benefit to local businesses, including restaurants, shops, pubs, theatres and hotels through the spending of those directly employed and employed in the supply chain.

Additionally, and just as importantly, shale gas would support jobs in the chemical industry and wider manufacturing by providing secure energy and important feed-stocks, helping the UK to manufacture more, and ultimately leading to an improvement in exports and the balance of payments.

By contrast in the USA, PWC have estimated that at least 1 million new manufacturing jobs could be created over the next decade, while CNN Money reports that 500,000 new jobs could be created from the export of US shale gas in LNG form to Europe and the far east where prices are 3 to 5 times higher than the USA.

As a filip for the economy Reuters have calculated (21 July 2014) that production of 8-10 bcm/year of gas, which amounts to 10% of current demand, will bring 3 to 4 billion dollars into the UK economy. The figures are fairly robust, but ignore the fact that such a level of production would take at least ten years to achieve.

Returning to the grass roots, it is the local benefit that will be key to convincing the general public that shale gas is not to be feared as a toxic unknown, but to be welcomed as an opportunity to improve the local community – national financial advantages are not important on this level.

In the USA, perhaps the most important driver for shale gas development was and is the fact that the land owners benefit financially from each well in a very direct fashion. In the UK, that is not the case, but a return of equity to local communities may make the responsible development of shale gas a good thing. It has been suggested that benefitting communities might improve their police forces and local education as a result. It has also been pointed out by some communities, who do not live on top of shale gas, that such a sharing of benefit to local communities would be unfair.

The trick is to ensure that everyone, whether locally, nationally or globally, benefits in a just manner.