Watching Government: 'Golden Rules' for global gas

June 11, 2012
The International Energy Agency released a special unconventional gas report May 29 in London outlining "Golden Rules for a Golden Age of Gas."

The International Energy Agency released a special unconventional gas report May 29 in London outlining "Golden Rules for a Golden Age of Gas." The report's aim is to provide a blueprint for governments, gas producers, and other stakeholders to address public concerns about potential impacts, IEA said.

"The technology and the know-how already exist for unconventional gas to be produced in an environmentally acceptable way," said IEA Executive Director Maria van der Hoeven. "But if the social and environmental impacts are not addressed properly, there is a very real possibility that public opposition to drilling for shale gas and other types of unconventional gas will halt the unconventional gas revolution in its tracks."

IEA said its "Golden Rules" emphasize the importance of full transparency, measuring, and monitoring of environmental impacts and engagement with local communities. They call for the careful choice of drilling sites and measures to prevent any leaks from wells into nearby aquifers; rigorous assessment and monitoring of water requirements and of waste water; measures to keep venting levels at zero and flaring minimal; and improved project planning and regulatory control.

The report sees a critical link between the way governments and gas producers respond to these challenges and the prospects for unconventional gas production.

"If this new industry is to prosper, it needs to earn and maintain its social license to operate," said IEA Chief Economist Fatih Birol, the report's chief author. "This comes with a financial cost, but in our estimation the additional costs are likely to be limited."

US reactions

Officials from two US trade associations reacted differently to the report. American Petroleum Institute Upstream Director Erik Milito said he was pleased that it acknowledged that the US oil and gas industry already has tough environmental standards, operates under stringent state regulations, and has transparent operations.

"The shale revolution is changing the face of American energy development, adding billions in state and federal revenue and reducing our trade deficit," he observed. "IEA and others around the world see these benefits and are looking to the US as the leader in safe and responsible shale energy production."

But Regina Hopper, executive director of America's Natural Gas Alliance, noted that while IEA acknowledged the role gas can play globally, its call for producers to address environmental issues ignores the FracFocus chemical registry and other concrete steps which have been taken domestically.

"The message that should be taken from this study is that we need not trade the protection of our environment for the many benefits natural gas can offer in terms of energy security, jobs and economic advancement, and clean air," she suggested.

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About the Author

Nick Snow

NICK SNOW covered oil and gas in Washington for more than 30 years. He worked in several capacities for The Oil Daily and was founding editor of Petroleum Finance Week before joining OGJ as its Washington correspondent in September 2005 and becoming its full-time Washington editor in October 2007. He retired from OGJ in January 2020.