15 January 2014
Article by Graham Winter, National Assembly for Wales Research Service
On 17 December 2013 the UK Government published a regulatory roadmap for shale oil and gas developers along with a Strategic Environmental Assessment report for consultation. It describes these new documents as the “next steps for shale gas production”.
The Regulatory Road Map includes a separate document for Wales called Onshore oil and gas exploration in the UK: regulation and best practice which is described as a first point of reference for anyone seeking to understand the permitting and permissions process for onshore shale gas and coal bed methane exploratory work in Wales. It has been developed by the newly established Office of Unconventional Gas and Oil (OUGO) in collaboration with other UK Government departments and the Welsh Government. It sets out an overview of the process, highlighting key pieces of legislation and regulation, and identifying required actions and best practices. The roadmap only covers the exploration and appraisal phases and not the development/production phase.
The Strategic Environmental Assessment looks at the environmental effects of a further round of onshore oil and gas licensing and includes both conventional and unconventional sources of gas. It has been published for consultation to meet the requirements of an EU Directive. As well as assessing the effects of additional licensing across Great Britain, the report also looks at the impacts on specific areas including South Wales and a small part of North East Wales.
The study includes this map showing existing areas where licences have already been granted for exploration as well as additional areas under consideration. These are the only parts of Wales where exploration for unconventional gas is currently being considered.
The assessment concludes that there aren’t any significant impacts for conventional oil and gas or coalbed methane exploration and production. However there are some likely significant effects for shale oil and gas.
These GB-wide effects include:
- Potential production of shale gas equivalent to twice the UK’s total current consumption of gas per annum;
- A potential 16,000-32,000 jobs created across the UK during the peak development phase;
- Greenhouse gas emissions of up to 0.96 million tonnes (carbon dioxide equivalent) per annum during exploration and between 0.71-1.42 million tonnes per annum during production;
- Up to 108 million cubic metres of waste water from ‘fracking’ requiring treatment which could place a significant burden on existing wastewater treatment infrastructure;
- Community benefit contributions from developers equivalent to up to £0.6 billion in total;
- Increased vehicle movements during exploration and preparation phases that could have an adverse on traffic congestion, noise or air quality in some areas;
- Large volumes of water required with uncertainty about the impact on water resource availability, aquatic habitats and water quality.
Some of the specific impacts associated with unconventional gas identified for Wales include:
- Biodiversity – the number of protected sites, especially the habitats associated with the Dee, Tyfi and Severn estuaries and local nature reserves means buffering of protected areas could be required;
- Population – short-term training opportunities associated with drilling activity, but negative impacts on quality of life from construction and associated HGV vehicle movements;
- Health – a potential increase in health problems, especially respiratory issues if a high proportion of drilling sites are located in or close to urban areas;
- Water – some potential for some shortages in parts of South Wales, but only if there is a high level of ‘fracking’ activity, but no major decreases in water quality;
- Waste Water treatment – the volume of water needing treatment is likely to place a significant burden on treatment works and increase the volume of hazardous by-products;
- Air – potential for high levels of emissions and cumulative effects in some areas where air quality is already poor;
- Cultural Heritage – the visual impact of new roads and pipelines could have an impact on listed buildings or historic landscapes in some places – buffer zones may be required.
- Landscape – some visual impact from drilling activity, mostly in the higher and remote areas of North Wales.
The consultation on the Strategic Environmental Assessment closes on 28 March 2014. The UK Government will then issue a “Post-Adoption Statement” which will summarise how it intends to proceed in relation to further onshore licensing.
For more information on shale gas or SEA please see the Research Service paper on Shale Gas and Coal Bed Methane (Unconventional Gas) and quick guide on Strategic Environmental Assessment.