Fracking At Face Value

Published 11 years ago

It’s no secret that South Africa, the biggest and most power-rich country in Africa, faces an energy crisis. It has left the country’s growing industry and mining sector lagging. Government says the 485 tcf (trillion cubic feet) shale gas reserve, could be an answer.

Hydraulic fracturing, also known as fracking, involves horizontal drilling to create fissures. The insertion of pressurized water, sand and fracking fluids release the gas. The tight-rock shale gas reserve is compared to extracting small pockets of gas from cement. Conventional fracking requires a high volume of water, up to 20 million liters per well. The process is heavily criticized for its potential environmental damage such as water usage and contamination; the pollution resulting from the production process and spoiling the biodiversity and aesthetics of the Karoo—a vast, largely untouched, landscape just to the north of Cape Town.

“The focus has been on the bad things, but there are many good things,” says Rob Jeffrey, managing director of Econometrix, who presented their economic predications for fracking at the Fossil Fuel Foundation conference on May 29, in Johannesburg. Organizers were disappointed that no government officials or policy-makers attended.

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“South Africa is an energy-intensive country… If we want high growth, we need more energy. Fracking will encourage local industry development and create many jobs because the gas industry will be built from the bottom up, unlike in the States. It will result in poverty alleviation, by building downstream and upstream industries,” says Jeffrey.

The National Energy Regulator of South Africa (NERSA) is in charge of licensing; Petroleum Agency South Africa (PASA) is in charge of gas production and the government would be in charge of distribution. The time is now, says Ethel Teljeur of NERSA.

“South Africa [might] miss the window of low gas prices if it doesn’t invest in gas infrastructure,” she says.

Teljeur gave the example of missed opportunity in South Africa when home-grown energy company, Sasol, bought shale gas interests in Canada (Talisman) worth over $2 billion and would invest R10 billion ($1.17 billion) over the next five years; money that could have been invested at home.

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An argument for fracking could find favor with the government. Dipuo Peters, South Africa’s Energy Minister, was one of the cabinet members who placed a moratorium on fracking. She says fracking should go ahead, if it can be done in a safe and responsible manner.

“The government is cognizant of the controversies associated with shale-gas extraction processes such as ground water and soil contamination, however with on-going developments I am confident that these challenges will in the not-so-far future come to pass,” she said in late March.

In her budget vote speech at the end of May, Susan Shabangu, Minister of Mineral Resources, said the investigation into the feasibility of shale gas in the Karoo will be presented to Cabinet in July.

“We should not have to sue the minister [Shabangu] to get the information which each citizen is entitled to know,” says Jonathan Deal—chairman of the Treasure the Karoo Action Group (TKAG). He took legal action, when in spite of letters and applications, little information was forthcoming. The TKAG won the case.

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“When it was being established we needed to know who was on the task team; what they were investigating; who they were consulting; what reports they were considering; whether they had visited America or not or anywhere where fracking was happening. And essentially, what their activities were. We were concerned that it was being manipulated, or orchestrated. We wanted transparency, in revealing the information,” he says over a telephone interview from his Karoo farm.

Deal is an entrepreneur who is not opposed to economic development, as he has often been accused; on the contrary, he supports it, if it is done in a sustainable and responsible manner. He notes that there are more than 140 places worldwide, where fracking is under a moratorium, restriction or a ban.

Deal claims he has attended more public participation meetings than any other South African. He has sat with lobbying gas companies and their consultants.

“They are misleading and side-step the real issues. They have obfuscated and clothed it [public participation meetings] in technical details. And then they are allowed to tick a box to say they have visited wherever and consulted with the local community,” he says.

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“One of the fatal flaws gas companies face is the millions of people in this country who will be directly affected by fracking but know nothing about it. They are the rural people that work on the farms, who do not have email, cellphones, telephones or a car to the nearest library to digest Shell’s technical English EMP [Environmental Management Plan].”

The energy industry is trying to get around these fears, with new technology. Andrew Kinghorn, of Shava Mining Enterprise, spoke about GasFrac’s Liquid Petroleum Gas (LPG) gel. The American-based company has eliminated conventional fracking fluids and the use of water for fracking. They pride themselves in being friendlier to the environment.

The waterless LPG gel remains liquid throughout the stimulation process. After the frac closes the gel returns to a low viscosity and supports sand in the fractures. When using water, around 20% to 50% of the fracture never contributes to gas production because it is in contact with water.

“Nearly 100% of the LPG gel is returned with the flowback in a much shorter time, 10 to 15 days, than conventional fracking methods,” says Kinghorn.

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The gel’s properties include low surface tension; low viscosity and low density. It is soluble in hydrocarbons, which enables 3 to 5 times longer fracs; higher long-term production and quicker time to the market.

“It results in the elimination of water, water wells, ponds, handling facilities, frac tanks, additional cartage, disposal costs and the reduced flowback cost due to quick clean up. By using LPG, we are able to realize a higher yield of oil or gas and we don’t take water away from other uses or have the demanding logistics of transporting millions of gallons of water to a well,” he says.

Another positive advancement in the industry, as pointed out by Doug Bentley, of Schlumberger, is that all hydraulic fracturing chemicals are biodegradable. The only question which remains is, are gas companies willing to pay for the more expensive, environmentally friendly fracking fluids? Bentley emphasizes that: “Well placement is the number one issue for improved production. Drilling needs to be planned in 3D as soon as possible.”

There are numerous factors to be considered: the social, economic and ecological. Philip Lloyd, research professor at the Cape Peninsula University of Technology refers to gas as the “beautiful fuel” which provides an opportunity to develop our power system in a clean, relatively low-carbon way.

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The reserve might be overestimated, due to the disappearing of gas through volcano-like cone escape structures over billions of years, according to Professor Maarten de Wit from Nelson Mandela Metropolitan University. Scientists are unsure of the amount of escaped gas and how much remains.

“The South African landscape differs vastly from that of the United States because of the dolerite outcrop and needs to be assessed in a different way,” he says.

For now, gas companies and South Africans, alike, are holding their breath ahead of the outcome of the task team’s findings later this month.