Transcript No Slide Title

Drivers of the Environmental Renaissance
August 31, 2010
John R. Duda
Director, Strategic Center for Natural Gas & Oil
IPEC, Aug. 31, 2010
A Tragic, Never-To-Be-Forgotten Disaster
…But not the Genesis
Source: http://www.msnbc.msn.com/id/36880053
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Outline
 Historical context
 Fundamental drivers
 What’s at stake
 What’s to be done
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U.S. Environmental Milestones
Santa Barbara
(200 M gal.)
Love Canal
Exxon Valdez
(11-32 MM gal.)
3 Mile
Island
1960s
1970s
1980s
1990s
CA auto
emissions
“Silent Spring”
Wilderness Act
First Earth Day
EPA established
Clean Air Act
2000s
Roadless
Rule
Superfund Bill
Clean Water Act
Endangered Species Act
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Macondo
(~200 MM gal.)
Kyoto Protocol
Clean Air Act +
Oil Pollution Act
EPA to regulate CO2
1950 to 2010 … from Gushers to Green
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Gas Shale Related Legislation
Wellhead Natural Gas Price ($/Mcf)
EPAct 2005: Congress excludes
hydraulic fracturing from Safe
Drinking Water Act (UIC)
EPA concludes
hydraulic fracturing no
danger to drinking water
Other: Ohio Shale, Antrim, New Albany
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FRAC Act introduced in
Congress to make fractured
wells Class II Disposal wells
Most Active Shale Plays
# rigs drlg for gas
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Source: EIA, with data from Smith International
Result … Active Opposition to Development
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Fundamental Driver 1: Fear
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Fundamental Driver 2: Distrust
Government
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Business
Fundamental Driver 3: Confusion
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“…showed a much higher
level of total dissolved
solids…”
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Dominion Post, September 15, 2009
Perspective of 51 “Shale” Web Sites
16%
40%
18%
10%
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16%
Anti-shale blog/group
Impartial information
Pro-shale industry
State organization
Pro-shale informative
Web Site Tag Lines
 “New York has the best
drinking water in the world.
Let's not frack it up!”
 “What the frack?”
 “Saving our land, air, & water-
you can't drink gas”
 “Your place to speak out on
industrial-scale drilling for
natural gas”
 “Protecting our communities
and environment from
exploitative gas drilling of the
Marcellus Shale”
Anti-Shale
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 “The Marcellus Shale: Energy
to fuel our future”
 “Your source for information
about the benefits of natural
gas exploration in the
Marcellus Shale”
 “A partnership established to
provide the regional
community and the natural
gas industry with a central
resource for workforce
development and community
education needs related to
Marcellus Shale gas”
Pro-Shale
New Yorkers Are Not Against All Development
1609
2009
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Source: National Geographic Magazine, September 2009
Marcellus Shale Drillers in Pennsylvania
Amass 1435 Violations in 2.5 Years
Discharge of
Industrial Waste
154
Violations of PA
Clean Stream Law
100
Permitting
Violations
38
Improper
Restoration
of Extraction Site
Improper Well
Casing
Construction
10
Improper Erosion &
Sediment Plans
Developed/Implemented
277
Improper Construction of
Wastewater Impoundment
268
Faulty Pollution
Prevention Practices
65
Improper Waste
Management
7
1 PALTA identified companies that have had violations, according to news reports, but are not included in the data, received on 5/10/2010 and
7/10/2010, from the PA Department of Environmental Protection. The Association has not been able to reconcile this difference.
2 Pennsylvania Department of Environmental Protection News Release (6/23/2010)
For information on methodology, contact Elana RIchman at 717.230.8560 or email [email protected].
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Source: Pennsylvania Land Trust Association (August 2, 2010)
Benefits Need to be Recognized
Table reflects PA analytical results
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Impact of No Shale Gas Development in 2035
Reference No Gas Shale High Gas Shale
Case
Drilling
Resource
2035 Henry Hub Spot Price
(2008 $/MMBtu)
$8.88
$10.37
$7.62
2035 Total Onshore Lwr. 48 Gas
Production (Tcf)
23.3
19.1
25.9
2035 Total U.S. Net Imports (Tcf)
1.5
3.7
0.8
Sensitivity Cases for AEO2010
Reference: Drilling moves ahead at current pace, unproved shale gas resource 347 Tcf
No Gas Shale Drilling: No new onshore, lower 48 shale drilling after 2009
High Gas Shale Resource: Unproved shale gas resources increased to 652 Tcf
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Source: Energy Information Administration, 2010.
Public Outreach Challenges
 Finding ways to promote regulations that are science-
based and reflect true costs and benefits
 How to collect and analyze data needed to develop science-
based regulations in a competitive, high-cost environment
 How to quantify potential future costs and benefits
 Finding ways to support an informed debate in an
environment of misinformation
 How to build public trust in objective assessments of risks
 How to carry out public outreach in a way that reaches the
widest possible audience with accurate information
 How to engage constituencies with diametrically opposed
viewpoints
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Standing Still is Not an Option
 Get out the facts … via websites,
publications, commercials, community
meetings … whatever works
 Promote reasonable, compromise
solutions to address community
concerns
 Pursue collaborative research and
development (industry, academia, and
government) in support of science-based
regulations
 Maintain transparency and public
accountability
 Participate in joint public/private
investment in workforce training to
reduce accidents
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