Around 100 people crammed into a tiny community center in West Michigan this week for a town hall meeting on hydraulic fracturing. Michigan ranks 15th in the nation in terms of natural gas reserves, with its Antrim play in the northern Lower Peninsula producing around 126 billion cubic feet per year in 2009. Overseas, residents in Lancashire, in northwest England, are keeping their own eye on developments as so-called fracking operations are set to resume after a brief hiatus. Energy company Cuadrilla is targeting an area that holds more than twice the amount of shale natural gas than is presumably left in northern Michigan. The state lawmaker who convened the meeting said there are no plans for the controversial practice in the region. Residents, however, expressed concern about the practice, fueling the debate over just what’s driving the growing concerns over shale.
Cuadrilla Resources is targeting an estimated 300 trillion cubic feet of natural gas in the Bowland basin in northwest England. So-called fracking operations were halted there when small tremors were linked to initial testing in 2011. With an early-warning system in hand, the company now expects it’s the only one in the country using technology that’s already put the United States in a leadership position in terms of natural gas reserves. Lancashire residents and government officials alike have expressed concern about Cuadrilla’s plans given that, for the most part, regional oil and gas campaigns have focused on offshore developments. Nevertheless, George Osborne, the British finance minister, said the government was banking on the shale potential.
“I want Britain to tap into new sources of low-cost energy like shale gas,” he said. “Shale gas is part of the future. And we will make it happen.”
A subsidiary of Canadian energy company Encana Corp. (NYSE: ECA) in 2010 said there was a “meaningful” amount of natural gas in the Collingwood-Utica shale play in Michigan. Much of that is situated in the northern Lower Peninsula. The Antrim play in the same region gave up 126 billion cubic feet of natural gas in 2009, though the U.S. Energy Departmentsaid that play is in decline.
In October, oil and gas companies shelled out $2.5 million for Michigan leases during the state’s last auction. Another round is set for May. State Rep. Lisa Posthumus Lyons, a Republican, welcomed around 100 people to a town hall forum in Ada Township, a tiny upscale suburb of Grand Rapids and home to holding company Alticor. There, state geology and environmental officials explained that Michigan has perhaps the strongest laws on the books regarding hydraulic fracturing. Lyons, who received campaign contributions from the oil and gas industry, saidfracking isn’t going on in Ada and “we don’t expect it to go on anytime soon.”
State leaders explained to residents the verdict was still out on the shale gas potential in western Michigan. If any were to occur, officials said the state has regulations ranging from post-drilling remediation to water protection that should allay most concerns. While there are no guarantees, they said, issues like earthquakes are exceedingly rare. Overseas, Cuadrilla officials said they’re going above and beyond safety requirements used already in the United States, though even that did little to quiet the critics. Michigan officials got a similar reception despite saying there were no documented cases where fracking caused environmental damage in the state. Concerns over new and high-profile technologies are likely to stir a public reaction. But just like fears that cell phones can cause fires at gasoline stations, it’s a matter of contention whether some of the concerns over fracking are valid or a simple case of public paranoia.
This piece is cross-posted from Oil Price.com with permission.