Shalegas production in NL: a case studyThe Brabant Case

Taco Hoencamp, shalegas expert Royal HaskoningDHV

Suppose:

� Minister Kamp decides to shale gas exploration drillings

� Production of shale gas is economically viable

� A gas company wants to produce:

Case study Brabant for EBN: 2011/12

1. Shale gas production field:� How does it look like?

2. Which environmental effects?3. Which mitigating measures

possible?4. Participation of the region

� C-MER (19/9/2013): case study example for National Spatial plan shale gas

� Four subjects above in this presentation

Production field shale gas: many sites

Each site: clustering of 6- 10 wells� Vertical well: 3500m deep� Horizontal well: 1500-2500m

� Space between horizontal wells: 400m

� Surface ± 10 – 20 km2

� 1-2 year drilling - 2 month fracking� Production phase 10 to 15 years� Water use

� Drilling: ± 13.000 m3� Fracking with re-use: ± 90.000 m3

� Waste water� Drilling water: ± 13.000 m3� Production water ± 90.000 m3 per year

Finding sites (in the case study): via GIS

� Keep distance from:� Buildings, houses� Roads, railways, canals, rivers� Existing safety zones

� i.e. gas and fuel lines

� Ground water protection areas, drill free zones� Natura2000 areas� Fault lines� Archaeological sites

� Preference for:� Agricultural areas� Near main gas distribution lines

Example 1: Away from buildings,houses

�Distance > 100m

�Difficult criteria

�NL is densely populated

Eindhoven

Example 2: Not in protected areas

� But still very close.

� Appropriate Assessment obligatory� Assess effects

on nature

Example 3: Oil and gas distribution systems

� Not too close� Safety risk

� Not too far� NL- gas

network needed for distribution

Example 4: Preference for agricultural areas

� Preference for� Pasture� Farm land

� Stay away from � Hay (heide)

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Production field - result spatial analysis

� Area around Boxtel� 37 sites� Average surface 10 km2

� Construction in 10-15 yrs� 3 – 5 drilling rigs� Mitigating measures

� Not drilling simultaneously in all areas

� Central gas treatment� Gas pipes buried along

roads to treatment plant

Under the surface it looks likes this

3D-view of Wells

Edited concept Scenario 4

Shale gas phases

� Site preparation� Well drilling� Fracking� Production

� Re-fracking ( after ±10 year)

Possible environmental effects production field

� Traffic disturbance� Waste water storage / transport� Water use� Tremors� Noise and light disturbance� Landscape� Ground water pollution� Also (but not in this presentation)

� Chemicals� Regional Safety� Nature / Natura2000

Traffic disturbance mostly during first 8 years

� A lot of circulating trucks with� Drilling rigs, � Fracking machines, � A lot of water and sand� Waste water and production water� Other (such as chemicals)

� Road network not suitable everywhere: � Small roads for light traffic � Traffic security

� CO2 emissions, tremors, noise

Reduction traffic disturbance: waste water collection

� If you are digging for a gas collection system:� Waste water via pipes� Same trench as of gas

collection lines

� To central treatment plant� Less traffic� Less risks for pollution

� (proper monitoring required)

Reduction traffic disturbance: water supply system

� If you are digging for a gas collection system:� Water supply via pipes� For a large part: same

trench as gas lines� Water company “Brabant

Water”� Water production per year: � 180.000.000 m3

� Of which 40% for industry

� Water use shale gas:� 8.000.000 m3 in 8 year

� 1.000.000 m3 per year

� = 0,5% production of BW

Tremors

� Only with fracking� Not due to subsidence

� In UK: 2,3 Richter scale� More wells, more fracks, more risks� Risk reduction by:

� Stay away from faults: detailed research� Constant micro seismic monitoring� Apply traffic light method

Light

� Light disturbance of drilling rigs / well locations� Already significantly reduced by existing measures� Adapted light: Clear Sky-lamps� Inward directed lightning

� Much less disturbance for flora and fauna� Much less visible from a distance

Groundwater

� Contamination via fracks� Not a real risk� Length fracks maximum 300 m,

horizontal well at > 3000 m depth� Many impermeable layers in

between well - groundwater� Careful with faults

� Contamination via well: possible� Production field many wells, more

risk� Proper well design, many casings� Proper monitoring

Landscape and local solutions

� Site selection based on:� Criteria (as from the case study)

� Additional criteria� Least possible noise disturbance� Safest routes for heavy traffic� Fitting in the landscape� Participation of the region

Fitting in the landscape

Average area covered by a site: 10 – 20 km2

Average distance between sites: 4 – 6 km

Fitting in the landscape

Average area covered by a site: 10 – 20 km2

Average distance between sites: 4 – 6 km

Economics of Brabant shale gas production� Based on:

� Halliburton Notional Field Development� Royal HaskoningDHV calculation of costs� EBN Leeswijzer� Not based on exploration drillings!!

� Capital Investment for 37 sites / 315 wells:� Drilling: € 2.7 - € 3.0 billion� Fracking: € 1.2 billion� Installations, pipe systems: € 0.6 - € 0,7 billion� Totalling € 4,5 – 4,9 billion

� Operational costs for 15 years: € 2.3 – 2.8 billion� Production per year: average 6.000.000.000 m3

� Profit (after taxes) based on € 0,26/m3 gas prize� 16-18% return on investment

Also in the case study (2011!):

� Oil- and gas drillings are controversial in NL: example Waddenzee,

� Shale gas has a bad name:� Mainly due to bad experiences in US� Gas land; The Promised Land� A lot of positive changes now in US

� Conditions for proper participation region:� Openness� Transparency� Include region in spatial planning process� Create Win - Win situations

Transparency and opennessExample: North-South line Amsterdam (metro)� Past:

� A lot of hindrance � Subsidence of houses � No contact with citizens� Project about to stop

� Now: � Openness, transparency� No censorship� Every debate / comments through website� Pro- and Contra- debate on website� Contractor workers show what they are doing� Organised visits to building sites; � Some construction parts permanently accessible

Transparency and openness

� Make risks discussable� Show what you will do when a

risk occurs.

� Open house� Excursions to the

drilling/fracking site� Invite the surrounding citizens:

open days� Visit schools, social clubs

Damage form

Monitoring: essential element of openness

� Measure a lot: � Measure smart and measure thoroughly� Show what you measure

� direct online, no censorship

� To be monitored:� Drilling process: solid waste, energy use � Fracking process: seismic activity, energy use� Waste water: quality / quantity� Traffic intensity� Air, light, noise emissions� Gas production: � And many more

� Independent controller

Win - win situations

� Share profits: regional or Local Fund for investments

� Shale gas followed by use of geothermal heat

� Long term lease of (agricultural) fields for sites� Income guaranty agriculture

Conclusions

Production of shale gas on a regional scale

� A thorough EIA is required:� Some effects seems small, others very large� Many effects can be mitigated� Some effects demand specific measures

� Find solutions together with the region

� Be open with information and discuss risks� (and the measures to contain them)

Conclusion

� Thanks to EBN for making this presentation possible

� Link to RHDHV report on website EBN:http://www.ebn.nl/Actueel/Documents/2012_Shale-gas-production-in-a-Dutch-perspective_Haskoning.pdf

� More information:� Taco.hoencamp@rhdhv.com� Erik.zigterman@rhdhv.com� www.royalhaskoningdhv.com