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Issue No. 22 - December 15, 2013

Year in Review (2/2)

Twice monthly since February 2013, the SGBI has featured the latest news and research related to hydraulic fracturing and its impacts on the environment, health, climate change, and local economies. In the final two issues of the year, we regroup some of the major developments of the year in the following categories: water, climate, health, economics, air pollution, and renewable energy as an alternative to fossil fuels. We hope readers will find these two review issues useful for future reference.

In addition, we recommend the "Memorandum Regarding Developments Concerning The Risks Of Shale Gas Development Since Fall 2012", a brief document by John Armstrong of the US group Frack Action which provides a list of major studies on the impacts of hydraulic fracturing and includes links to all these papers.

1. The (un)economies of shale

Exaggerated reserves

   Exaggerated reserves
  • New York Times "Drilling Down" series [SGBI No. 1] reports on industry exaggeration of reserves and New York State's concerns for its pension funds invested in shale:
New Report by Agency Lowers Estimates of Natural Gas in U.S. 
Regulators Seek Records on Claims for Gas Wells
New York Subpoenas Energy Firms
  • Deborah Rogers explains the difference between "resources" and "reserves" (video) [SGBI No. 1]
  • Poland's shale gas reserve estimates reduced by five times [SGBI No. 5]
  Shale speculative bubble

Shale speculative bubble

rapidly declining production

   High costs, low prices, rapidly declining production
  • Report by geologist David Hughes concludes that unconventional fuel production will likely peak in 2017 [SGBI No. 4]
  • Presentation in Brussels (Hughes and Zittel) “Behind the hype: the economics of shale gas in Europe” : the high capital requirements of shale gas development mean that a long-term supply of plentiful and cheap shale gas is not a realistic expectation. [SGBI No. 8]
  • Majors losing money in shale, producers find it more economical to flare gas from shale oil operations in the Bakken shale than to bring the gas to market [SGBI No. 14]
  • Deborah Rogers visits Ireland, talks to Pat Kenny about the unprofitability of shale [SGBI No. 17]
  • Shale gas/oil write-downs explained (video of Deborah Rogers' presentation in Ireland) [SGBI No. 20]
  • Even at below-cost gas prices, US utilities are switching back to cheaper coal [SGBI No. 20]
  • Production costs are likely to be three times higher in Europe than in US [SGBI No. 9]
  Little contribution to job growth, economic growth
  • Between 2011 and 2012, when extensive fracking occurred in northeastern Ohio, jobs growth was only 0.1% higher than in other parts of the state where fracking did not occur [SGBI No. 6]
  • Oil and gas extraction in New York state's top ten "gas counties" is only responsible for 0.03% of all non-farm employment, and only 0.04% of all non-farm payroll amounts. Figures from neighbouring Pennsylvania are similar. Local industries such as agriculture and tourism are found to have higher economic multipliers [SGBI No. 6]
  • Shale gas “revolution" found to have had 0.07% effect on US GDP growth [SGBI No. 8]

Farming not fracking
  Costs to local communities and economies
  • Brewers opposed to fracking in US and Europe [SGBI No. 10]
  • Effects of shale gas operations on the dairy sector, reports on the impacts on the Pennsylvania dairy sector, New Zealand cooperative announces it will not source milk from land contaminated by fracking waste [SGBI No. 11]
  • Two reports on the costs of shale gas operations to local communities [SGBI No. 13]
  • Fracking and property values, mortgages, and home insurance [SGBI, No. 16]

2. Air pollution

Air pollution
  Air pollution and health risks
  (See also 
Year in Review 1/2 - Health Impacts  [SGBI No. 21]
  • Study from the US Center for Environmental Health on the health impacts of air and water contamination from shale gas/oil operations [SGBI No. 11]
  • Presentation on the air quality impacts of unconventional natural gas development, given in Brussels by Dr. Robert Field (University of Wyoming) [SGBI No. 11]
  • Texas Endocrine Disruption Exchange (TEDX) 2012 study, which sampled air quality before, during, and after natural gas operations in rural western Colorado, found many non-methane hydrocarbons (NMHCs) in concentrations high enough to pose health risks. The study also noted that 30 of the chemicals found (including benzene), are considered to be endocrine disruptors, which have adverse health effects at even extremely low concentrations. [SGBI No. 7]

3. Energy transition

Energy efficiency

  Energy efficiency
  • Energy efficiency gains found to be the best way for European businesses to cut costs and improve competitiveness [SGBI No. 9]
  • Energy efficiency could offer the EU €250 billion of net annual savings by 2030, through direct savings and indirect reductions in energy prices [SGBI No. 9]
  • Presentation (David Hughes, May 2012) examining global energy consumption and supply over time, the growth expected over the next few decades, and the physical limits to this growth [SGBI No. 13]
  • Interactive models of two energy futures [SGBI No. 15]
  Renewable energy
  (See also Year in Review 1/2 - Climate Change [SGBI No. 21])
  • Renewable energy is cheaper than natural gas for electricity generation [SGBI No. 15]
  • Renewable energy could be 30% of US power supply by 2026
    [SGBI No. 15]
  • Sufficient renewable energy exists to power the world, public policy needed to promote transition [SGBI No. 20]
Renewable energy

In addition to our review issues, please use our All Issues page (in left sidebar and below) and our search function (upper right) as reference tools to find studies, articles, fact sheets, and more related to unconventional shale gas/oil extraction.

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