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Special Digest

Regulation and the report of the The Royal Society and The Royal Academy of Engineering, June 2012, part five


2/11/13

Robert Mair’s Evidence summary, Lords Select Committee on Economic Affiars, 29/10/13

Professor Robert Mair CBE, Cambridge University, who chaired the Royal Society and Royal Academy of Engineering June 2012 report on shale gas.

My notes in bold, quotes in italics. The following includes extracts from the uncorrected transcript of the evidence session.

Mair firstly summarised the report findings.

“first, that the risks associated with shale gas exploration can be managed effectively in the UK, similar to the risks of existing onshore activities, so long as operational best practice is followed and enforced through strong regulation. The second key finding is that the risks management will require competence and capacity for doing so both in the operator and in the regulator, and attention must be paid to how risks may well scale up should an industry develop nationwide, in which case the regulatory co-ordination and the capacity will become more crucial. In a nutshell, our report was saying that we believe that the risks can be managed effectively provided that operational best practices are enforced.”

Note the use of the word”enforced” in view of his later evidence.

1. Water contamination and supply

Mair said “our report concluded that the probability of contamination via fractures penetrating up from great depths and encountering aquifers is very low indeed, provided that the fracking is undertaken at great depth, typically kilometres below the ground surface. The maximum vertical distance of artificially created fractures by the fracking process in the USA—of course, we are very much drawing on USA experience—was found to be 600 metres at the very most. So given that the fracking operation is likely to be at much greater depths than that, the probability of contamination through that process of fractures finding their way up to aquifers is very low indeed. A much more likely source of potential contamination is poorly constructed wells, so well integrity is paramount. That is a key point that we make in our report.
There is no question that there have been some instances of contamination of water supplies in the USA, but we found no evidence that any of that was due to the fracturing process itself: in other words, it was through fractures penetrating from great depths up to
encounter aquifers. It is much more likely that those instances of contamination were due to faulty well construction and surface spillage. This is about the whole process of managing the operations well. Like any industrial operation, any spillage or that kind of event can lead to contamination.

The 600m came from Richard Davies of Durham University, who recommended that at least 1.2km should be left between a fracking horizontal and an aquifer.

“Q70 Lord Griffiths of Fforestfach: In the second source of contamination that you mentioned—faulty wells, leaks and surface spillages—what is the evidence from the US that that is quite a serious problem?
Professor Robert Mair
: It is a serious problem in that any contamination of freshwater is serious. The evidence from the US is rather hard to unravel, I have to say, not least because of the absence of baseline monitoring. …  That is a very important part of the conclusions of our review: that unless you have very clear baseline monitorings and you know what the situation is before you even start any operations, the evidence is hard to unravel. Certainly, in the USA, there is no question that that there are some areas where the geology is such that methane naturally bubbles up into the groundwater. It can be very misleading to imply that that is all down to hydraulic fracturing and shale gas extraction.

It is remembered that the government’s response to the recommendation for baseline monitoring was “The British Geological Survey (BGS) are working with the Environment Agency to establish a national baseline. DECC will work with the Environment Agency and SEPA to agree the scope of “other contaminants” that should be included.”
To my knowledge the only survey work conducted so far has been restricted to methane. To the request for site-specific monitoring before, during and after drilling the government said this was left to the operator as “good oilfield practice” and would ask operators to display results on their websites.

On the issue of water supplies Mair did not address directly the question of high freshwater use and its consequences but talked about the potential being explored in the US for using saline waters from deep underground, or for replacing water fracking with gels or carbon dioxide and nitrogen foams.

Mair dismissed seismicity as a negligible riak, especially since the introduction of the traffic light system.

On methane emissions -

Q71 Lord May of Oxford: I would like to raise the question of methane emissions, which have been raised by those who are critical. As you know, the NGOs cite research from Princeton, which suggested that you get the benefits only if the methane leakage from national gas production is below something like 3%. Conversely, Professor Muller, who seems to me in general to be as relentlessly upbeat as the NGOs are relentlessly downbeat, has suggested that that is more like 18%. I personally, having spent a dozen years of my life as vice-president of research at Princeton, am inclined to trust the Princeton figure more than Professor Muller, but I would like to hear you on the subject.
Professor Robert Mair
: I have to say that the jury is still out on the precise quantities of methane emissions during the actual process of shale gas operations. I think that Professor Mackay’s report, which was produced last month along with Dr Stone, is excellent in addressing these points. It is the same point related to the baseline monitoring point in that we need to make very careful measurements of methane escape, if there is any, in the atmosphere, and take all possible steps to minimise that. Probably the most significant part of the operation is when the flowback fluids come back out of the well from great depths, having done the fracturing, and that is likely to have dissolved methane in it. If that fluid is allowed to be stored in an open pond, that will naturally lead to more methane emission, whereas if it is properly contained and the gas is very carefully trapped, all the evidence suggests that the emissions can be reduced to much smaller amounts. But the jury is out on the precise quantities.
Lord May of Oxford: If I understand it, you are saying that the jury is out both on the precise percentage you can retain and on what the safe percentage is anyhow.
Professor Robert Mair: I think both those two points, exactly.”

Mair thereby failed to answer the question of climate change benefits of shale gas claimed. Probably for the reason he does not know. The Royals did not consider climate change in relation to shale gas. It was not part of their brief.

On safety and regulation -

Baroness Blackstone: Following on from that, if those who are developing shale gas follow the advice of your report, would you be able to conclude in a one-line answer on the “Today” programme—
Lord May of Oxford: That is an oxymoron.
Baroness Blackstone: If you were able to conclude that it is in fact safe to extract shale gas in the UK without damage to the environment—you talked about the dangers of contamination in your answer to the previous question but one—what would your conclusion be if pushed on this?
Professor Robert Mair: If all the right safeguards are applied—that is an important proviso, but there is no reason why they should not be adhered to—then, yes, I believe that shale gas can be produced safely without any significant risk of contamination.
Baroness Blackstone: What are the circumstances in which the safeguards might not be adhered to?
Professor Robert Mair: We are talking, I suppose, about any complex technical operation. You could say that flying an aeroplane would be the same: that if the operators make a mistake—
Baroness Blackstone: So human error?
Professor Robert Mair: Human error, yes. One of the really important points that we drew out in our report was the role of the independent well examiner, who is there explicitly with the task of ensuring that the well design has been properly executed. To our mind, it needs to be ensured that that system really works. If that can be made to work, and we believe that it can be, the answer to your question is what I said earlier: that the risks are very low.
Baroness Blackstone: What about cutting corners to save on costs?
Professor Robert Mair: That has to be absolutely avoided, and it is important that the regulators ensure that that does not happen. It would not be in the operators’ interests to do that.

Mair in the last sentence exposes a certain naivety. Or lack of thinking through.  It is of course precisely in the operator’s interest to cut costs. It is not in their interest only if they cut corners and are found out.

Regarding the” independent well examiner”, currently the well examiner can be an employee of the operator or a subcontractor and still be regarded as “independent”.  The government rejected any change, contrary to the recommendation of the Royals on this matter. As Mair knows full well.

“Lord McFall of Alcluith: You mentioned the well examiner. How independent will that person be? Who will employ them?
Professor Robert Mair: That is something that we expressed some quite strong views on in our report. We believe that the current guidelines need to be clarified to ensure that the well examiner really is independent from the operator. In some cases, under existing practice, that well examiner can be an employee of the operator’s organisation. We felt that that was undesirable and that the well examiner should be truly independent.
Lord McFall of Alcluith: But you never called for new regulation? Do you think that that should be incorporated into any additional regulations?
Professor Robert Mair: Whether or not it needs to be in regulation is, I think, debatable, but we certainly think that the various government organisations that are overseeing the shale gas operations should ensure that that well examiner is truly independent.”

Mair starts here refusing to be drawn into the argument about whether new regulation is required.

The question was asked directly.
Lord McFall of Alcluith: Do you think there is a need for further regulations?”

The answer saw Mair wriggling out of answering. Bear in mind he has already recently told the press that the UK has adequate regulation in place.

The answer should be seen against the background of his telling the Telegraph in August Here in Britain, we have a long history of world-class oil and gas industry regulation, plus a unique examination scheme to ensure that the design, construction and abandonment of wells is reviewed by independent, specialist experts

And Last year, I chaired a joint committee set up by the Royal Society and Royal Academy of Engineering to analyse the environmental, health and safety risks associated with shale gas exploration in Britain. We came up with a set of recommendations for the Government to make it as safe as possible, if they decided to go ahead. The report concluded that these risks could be managed effectively as long as operational best practices were implemented, and enforced through regulation. The Government has accepted all the report’s recommendations.”

The independent well examiner issue in my view puts the lie to this last claim. The government did NOT implement all the report recommendations.

Professor Robert Mair: I think it is important to distinguish between there being clear guidelines for good practice and introducing new regulations. The Government, understandably in our view, do not wish to provide regulatory requirements that are too prescriptive and that all risk management should be the responsibility of the operator. In this context there is the crucial role of the environmental risk assessment. That is absolutely the responsibility of the operator, and it should be mandatory for all shale gas operations. The regulators need to ensure that that environmental risk assessment has been undertaken. That is slightly different from saying that there need to be more regulations. The answer to your question is that there are no specific new regulations that we identified. We made 10 major recommendations in our report, and I am pleased to say that the Government have accepted all 10 of them. So the Government have accepted the need to strengthen this and to ensure that the well examiner is independent.”

The last is news to me. The response in December 2012 to the question of the independent well examiner was this -“ Regulation 18 of the Offshore Installations and Wells (Design andConstruction etc) Regulations 1996 (DCR) requires the well operator to setup a well examination scheme and appoint an independent competentperson – the well examiner - to review the proposed and actual welloperations to confirm they meet the well operator’s policies and procedures,comply with DCR and follow good industry practice. Schemes of well examination must comply with the “Guidelines for well operators on wellexamination” and “Guidelines for well operators on competence of wellexaminers”, published by Oil & Gas UK.
The requirement for the independence of the well examiner is crucial, and“independent” is further defined in DCR. This independence is usuallyachieved by well examiners being from a separate company from the welloperator. However, there are a few well operators who wish to use in-houseexaminers, and that option is legally open to them if they can fulfil the DCR requirements of an appropriate level of impartiality and independence from any aspects of the well design/construction/operation. HSE provides guidance on this aspect, both in the Guidance on DCR (Booklet L84) and in SPC/TECH/OSD/43
.”

No sign of true independence, nor of any hint that this situation was to change.

Mair has fudged entirely the issue of what is regulation and what is not in huis reply to the Lords committee.

The answer also poses the question - what does Mair mean by an Environmental Risk Assessment? Is he confusing it with an Environmental Impact Assessment? Certainly there is no public involvement in an ERA as produced, for example in waste management permits for the Environmental Agency. And the government does not impose a requirement (nor encourages) EIA. What we need is mandatory EIA (of which ERA should be a part) NOT just a mandatory ERA..

The final word on regulation was this -

“Q73 Lord McFall of Alcluith: In the financial services industry, with the financial crisis, it was shown that the regulator did not have authority, and it is this lack of authority that was absent, for example, in a number of cases where wrongdoing was undertaken. Regulators mentioned that when they examined the institution, the trail went cold: in other words, they could not get to the person who was responsible. How do you think minimum regulation will ensure that that authority is there, that there is an identifiable responsibility for individuals, and that at the end of the day it will not be “nothing to do with me”?
Professor Robert Mair: We drew attention in our report to the need for there to be one overseeing part of the Government that deals with shale gas. At present, as you all know, there are a number of different organisations involved. There is DECC, there is the HSE, there is the Environment Agency. We said that there should be one organisation that oversees the whole process. We also distinguished between exploration, which is a relatively small part of the operation, and full-scale production, and we said that if the shale gas industry were to move into full-scale production, the regulation would have to address capacity very carefully. That, I think, answers your point that the people involved would have to be doing their job properly and ensuring that the whole process is being carried out as it should be.”

Again Mair ducks the real regulation issue. Is the existing regulation is fit for purpose or not. Mair in this answer indirectly implies it is not currently fit for full-scale onshore shale gas production.

On planning Mair was asked if he saw shale gas limited to any particular part of the country and he replied no, planning authorities would hande local concerns -

“Lord Griffiths of Fforestfach: But you would basically allow a negotiation between the operators and the local authorities?
Professor Robert Mair: Yes. The key point is the environmental risk assessment, which is of overriding importance. The environmental risk assessment, which is the responsibility of the operator, should engage the local communities at the outside of its preparation. It needs to embrace all the local concerns. If that is done properly and those concerns are addressed, the whole path will be much smoother.”

Again Mair refers to ERA, which is essentially a tool and technique used in preparing an EIA, but here it is more likely he is indeed thinking of EIA. In which case it increases belief that he earlier expressed support for mandatory EIA. However, he is only repeating the confusion in the report itself. Here is the recommendation of the Royals and the government response.

A) An Environmental Risk Assessment (ERA) should be mandatory for all shale gas operations, involving the participation of local communities at the earliest possible opportunity.

B) The ERA should assess risks across the entire lifecycle of shale gas extraction, including the disposal of wastes and well abandonment. Seismic risks should also feature as part of the ERA.

DECC answer - ERAs are already required by legislation in certain contexts, although these may not address all aspects of the operations in question. For example, when applying for environmental permits, operators are required to submit mandatory environmental risk assessments to support their applications, which then form part of the public consultation process. The regulators concur that an overall ERA addressing all risks in appropriate detail would be desirable even where not specified by legislation, and DECC will expect all operators to carry out such an assessment as a matter of good practice. This assessment can then be mapped onto the assessments required by legislation, such as the Environmental Impact Assessment,where this is required following screening by the relevant planning authority.DECC are consulting experts from Cranfield University to assist in the development of ERA guidance for shale gas activities as proposed by the academies, and to further address the scope requirements of the exploration and production phases.
The regulators support the engagement and participation of stakeholders, including local communities, at the earliest opportunity.

Clearly there is no intention here of involving the public in the content of Environmental Risk Assessment produced by an operator. Nor of giving opportunity to comment to the EA. And, of course, no plan to make ERA (or EIA) mandatory.

As a side comment on the DECC response, it is news to me that EA environmental permits become part of the public consultation process, or that an ERA is available as part of a planning application.

 

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