∂	

Shale	
  Gas	
  and	
  Oil:	
  Risks	
  and	
  
Rewards	
  
	
  
Prof	
  Richard	
  Davies	
  and	
  Mr	
  Sam	
  
Almond	
  
richard.davies@dur.ac.uk	
  
5th Smart Grids & Cleanpower Conference
5 June, Cambridge
www.cir-strategy.com/events
∂	

Shale	
  Gas	
  and	
  ‘Fracking’	
  
•  Organic	
  maBer	
  trapped	
  during	
  the	
  deposiEon	
  of	
  fine-­‐grained	
  shale	
  rocks.	
  
•  Low	
  permeability	
  
•  Hydraulic	
  fracturing	
  since	
  1940,	
  applied	
  with	
  horizontal	
  wells	
  from	
  1990	
  
onwards	
  (BarneB,	
  Texas).	
  
•  Widespread	
  use	
  is	
  new	
  and	
  therefore	
  cauEon	
  is	
  appropriate	
  
	
  
Aquifers	
  0-­‐1	
  km	
  
Shale	
  Gas	
  
Reservoirs	
  2-­‐5	
  km	
  
unconvenEonal	
  
reservoir	
  
∂	

Stages	
  of	
  Development	
  
Stop	
  
Poor	
  
Geology	
  
Good	
  
Stop	
  
Poor	
  
Good	
  
A	
  few	
  years	
  
Drilling	
  
and	
  
Casing	
  
Fracking	
  
Frack	
  Fluid	
  
Flowback	
  
Seismic	
  Data	
  	
   Explora<on	
  Well	
  
Drilling	
  and	
  
Hydraulic	
  
Fracturing	
  
Produc<on	
  
Abandonment	
  
Weeks	
  to	
  
months	
  
Years	
  to	
  
decades	
  
UK	
  
∂	

	

BGS	
  report	
  DECC	
  2012	
  
UK	
  :	
  How	
  Much?	
  
	
  
• Bowland	
  Shale	
  (Lancashire)	
  alone	
  could	
  be	
  
200	
  trillion	
  cubic	
  feet	
  (TCF)	
  underground	
  
(resources)	
  and	
  10%	
  (20	
  TCF)	
  recoverable	
  
(reserves).	
  
	
  
• Igas	
  announced	
  170	
  TCF	
  (resource)	
  in	
  the	
  
Cheshire	
  Basin	
  on	
  Monday	
  3rd	
  June.	
  
• UK	
  imports	
  1.4	
  TCF	
  per	
  year,	
  so	
  in	
  theory	
  the	
  
Bowland	
  shale	
  alone	
  could	
  fill	
  our	
  gas	
  gap	
  for	
  
decade/s	
  
• Reserves	
  depend	
  on	
  social	
  and	
  economic	
  
factors	
  as	
  much	
  as	
  geology.	
  
• So	
  we	
  don t	
  know.	
  In	
  the	
  hands	
  of	
  
communiEes,	
  poliEcians?	
  
200	
  TCF	
  
170	
  TCF	
  
∂	

	

How	
  Many	
  Wells?	
  
• 4	
  TCF	
  shale	
  gas	
  
producEon	
  in	
  
USA,	
  25,000	
  wells	
  
per	
  year	
  
• So	
  100s	
  to	
  1000s	
  
of	
  wells	
  required	
  
in	
  UK	
  to	
  make	
  a	
  
dent	
  on	
  reliance	
  
on	
  imports	
  
Source:	
  Department	
  of	
  Energy	
  and	
  Climate	
  Change,	
  
From	
  IoD	
  Report	
  (2013)	
  
~1.4	
  TCF	
  
~1.4	
  TCF	
  
∂	

0
20
40
60
80
100
120
140
160
180
1880 1900 1920 1940 1960 1980 2000 2020
Number	
  of	
  wells	
  drilled	
  
Year	
  
History	
  of	
  Hydrocarbon	
  Well	
  Drilling	
  in	
  UK	
  
?	
  
?	
  
?	
  
•  The	
  biggest	
  increase	
  in	
  drilling	
  acEvity	
  since	
  the	
  World	
  War	
  II?	
  
•  Development	
  of	
  supply	
  chain	
  
World	
  War	
  II	
  
∂	

Fracking	
  Issues	
  
www.oceanexplorer.noaa.gov	
  
•  Water	
  contaminaEon	
  
•  Earthquakes	
  
•  Others?	
  
∂	

Fracking	
  -­‐	
  ContaminaEon	
  of	
  Drinking	
  Water?	
  
•  BarneB	
  shale	
  (Texas)	
  
•  1000s	
  of	
  hydraulic	
  
fracturing	
  operaEons	
  
completed	
  
•  Fractures	
  not	
  tall	
  
enough	
  to	
  cause	
  
contamina<on	
  of	
  
water	
  
∂	

Earthquakes	
  
Energy	
  
due	
  to	
  
fracking	
  
•  Energy	
  due	
  to	
  fracking	
  
cannot	
  be	
  felt	
  at	
  the	
  surface	
  
•  Three	
  excepEons	
  from	
  
100,000s	
  of	
  fracking	
  
operaEons	
  -­‐	
  including	
  2.3	
  M	
  
event	
  in	
  UK	
  (April	
  2011)	
  
∂	

• Hydraulic	
  fracturing	
  
is	
  not	
  significant	
  
• Geothermal,	
  
reservoir	
  
impoundment,	
  
mining	
  and	
  
convenEonal	
  oil	
  
and	
  gas	
  are	
  more	
  
significant	
  
198	
  Published	
  Examples	
  of	
  Induced	
  Earthquakes	
  
from	
  All	
  Known	
  Triggers	
  Since	
  1929	
  
From	
  Davies,	
  Foulger,	
  
Bindley,	
  Styles	
  Marine	
  and	
  
Petroleum	
  Geology,	
  2013	
  
∂	

But	
  -­‐	
  Long	
  Term	
  Legacy	
  	
  	
  	
  
•  Wells	
  can	
  leak	
  over	
  Eme	
  
•  Note:	
  lots	
  of	
  wells	
  needed	
  
	
  
•  Need	
  long	
  term	
  monitoring	
  for	
  leak	
  
and	
  resealing	
  if	
  leaks	
  found	
  
•  Issue	
  in	
  the	
  USA	
  and	
  Canada	
  and	
  
probably	
  [to	
  some	
  extent]	
  in	
  the	
  UK.	
  
•  Note:	
  250,000	
  abandoned	
  mine	
  
shams	
  vs.	
  2100	
  hydrocarbon	
  
boreholes	
  in	
  the	
  UK.	
  
∂	

Summary	
  
•  Very	
  likely	
  UK	
  has	
  significant	
  potenEal	
  in	
  oil	
  and	
  gas	
  from	
  shale.	
  
•  How	
  much	
  will	
  be	
  determined	
  by	
  industry	
  gaining	
  a	
  social	
  
licence	
  to	
  drill	
  and	
  frack	
  wells,	
  economics	
  etc.	
  
•  Fracking	
  very	
  unlikely	
  cause	
  of	
  drinking	
  water	
  contaminaEon.	
  	
  	
  
•  Fracking	
  causes	
  earthquakes	
  –	
  but	
  very	
  small	
  ones.	
  
•  But	
  shale	
  gas	
  and	
  oil	
  development	
  would	
  require	
  alot	
  of	
  wells.	
  
•  So	
  long	
  term	
  monitoring	
  needed	
  	
  

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Sgcp13davies

  • 1. ∂ Shale  Gas  and  Oil:  Risks  and   Rewards     Prof  Richard  Davies  and  Mr  Sam   Almond   richard.davies@dur.ac.uk   5th Smart Grids & Cleanpower Conference 5 June, Cambridge www.cir-strategy.com/events
  • 2. ∂ Shale  Gas  and  ‘Fracking’   •  Organic  maBer  trapped  during  the  deposiEon  of  fine-­‐grained  shale  rocks.   •  Low  permeability   •  Hydraulic  fracturing  since  1940,  applied  with  horizontal  wells  from  1990   onwards  (BarneB,  Texas).   •  Widespread  use  is  new  and  therefore  cauEon  is  appropriate     Aquifers  0-­‐1  km   Shale  Gas   Reservoirs  2-­‐5  km   unconvenEonal   reservoir  
  • 3. ∂ Stages  of  Development   Stop   Poor   Geology   Good   Stop   Poor   Good   A  few  years   Drilling   and   Casing   Fracking   Frack  Fluid   Flowback   Seismic  Data     Explora<on  Well   Drilling  and   Hydraulic   Fracturing   Produc<on   Abandonment   Weeks  to   months   Years  to   decades   UK  
  • 4. ∂ BGS  report  DECC  2012   UK  :  How  Much?     • Bowland  Shale  (Lancashire)  alone  could  be   200  trillion  cubic  feet  (TCF)  underground   (resources)  and  10%  (20  TCF)  recoverable   (reserves).     • Igas  announced  170  TCF  (resource)  in  the   Cheshire  Basin  on  Monday  3rd  June.   • UK  imports  1.4  TCF  per  year,  so  in  theory  the   Bowland  shale  alone  could  fill  our  gas  gap  for   decade/s   • Reserves  depend  on  social  and  economic   factors  as  much  as  geology.   • So  we  don t  know.  In  the  hands  of   communiEes,  poliEcians?   200  TCF   170  TCF  
  • 5. ∂ How  Many  Wells?   • 4  TCF  shale  gas   producEon  in   USA,  25,000  wells   per  year   • So  100s  to  1000s   of  wells  required   in  UK  to  make  a   dent  on  reliance   on  imports   Source:  Department  of  Energy  and  Climate  Change,   From  IoD  Report  (2013)   ~1.4  TCF   ~1.4  TCF  
  • 6. ∂ 0 20 40 60 80 100 120 140 160 180 1880 1900 1920 1940 1960 1980 2000 2020 Number  of  wells  drilled   Year   History  of  Hydrocarbon  Well  Drilling  in  UK   ?   ?   ?   •  The  biggest  increase  in  drilling  acEvity  since  the  World  War  II?   •  Development  of  supply  chain   World  War  II  
  • 7. ∂ Fracking  Issues   www.oceanexplorer.noaa.gov   •  Water  contaminaEon   •  Earthquakes   •  Others?  
  • 8. ∂ Fracking  -­‐  ContaminaEon  of  Drinking  Water?   •  BarneB  shale  (Texas)   •  1000s  of  hydraulic   fracturing  operaEons   completed   •  Fractures  not  tall   enough  to  cause   contamina<on  of   water  
  • 9. ∂ Earthquakes   Energy   due  to   fracking   •  Energy  due  to  fracking   cannot  be  felt  at  the  surface   •  Three  excepEons  from   100,000s  of  fracking   operaEons  -­‐  including  2.3  M   event  in  UK  (April  2011)  
  • 10. ∂ • Hydraulic  fracturing   is  not  significant   • Geothermal,   reservoir   impoundment,   mining  and   convenEonal  oil   and  gas  are  more   significant   198  Published  Examples  of  Induced  Earthquakes   from  All  Known  Triggers  Since  1929   From  Davies,  Foulger,   Bindley,  Styles  Marine  and   Petroleum  Geology,  2013  
  • 11. ∂ But  -­‐  Long  Term  Legacy         •  Wells  can  leak  over  Eme   •  Note:  lots  of  wells  needed     •  Need  long  term  monitoring  for  leak   and  resealing  if  leaks  found   •  Issue  in  the  USA  and  Canada  and   probably  [to  some  extent]  in  the  UK.   •  Note:  250,000  abandoned  mine   shams  vs.  2100  hydrocarbon   boreholes  in  the  UK.  
  • 12. ∂ Summary   •  Very  likely  UK  has  significant  potenEal  in  oil  and  gas  from  shale.   •  How  much  will  be  determined  by  industry  gaining  a  social   licence  to  drill  and  frack  wells,  economics  etc.   •  Fracking  very  unlikely  cause  of  drinking  water  contaminaEon.       •  Fracking  causes  earthquakes  –  but  very  small  ones.   •  But  shale  gas  and  oil  development  would  require  alot  of  wells.   •  So  long  term  monitoring  needed