Communications Challenges in the Unconventional World

Getting Over It: the Shale Gas Communications Challenges, that is

Just think Gasland. Or the hydraulic fracturing moratorium in France. Or the earth tremors in Blackpool – all potential red flags against shale gas in the eyes of the press and the public.

Certainly, communicating with stakeholders has proved to be one of the E&P industry’s biggest hurdles in its efforts to develop shale gas in Europe and other parts of the globe.

In explaining the global context for the unconventional resource debate at the European Unconventional Gas Summit in Krakow, Poland, Patrick D’Ancona, Head of Energy Practice at M-Communications said there were now 12.5 million search results for “fracking” on Google.

“Nothing would’ve been found 10-15 years ago,” he commented, noting that there were so many search results today because of the emergence of a wide range of conventional resources.

“It’s a bit of a tug of war really,” he said, showing the drivers and the concerns, among which were environmental impact and transparency. “If you take those thoughts further down the road, the whole legitimacy of shale gas rests on these.”

D’Ancona presented a map from The Economist entitled “The Unconventional World.”

“There’s a disparity between the numbers of unconventional and conventional resources; and you can see that that’s going to mean a hell of a lot to those countries. The geopolitical balance of hydrocarbons has shifted, and countries like China and Argentina could join the ranks of those bearing them. Others could also become self sufficient,” he explained.

He mentioned the significant shift within the UK with recent news of Cuadrilla’s significant resources find.

“Politically, it’s a very mixed picture,” he commented.

D’Ancona said the U.S. was where shale gas had the highest media profile, due to factors like the documentary Gasland; he noted that Canada is vaguely pro fracking.

He said: “The U.S. is a good start to show where there have been moratoria, different states have different levels of disclosure, and the EPA is supposed to publish a report on shale gas in 2012.”

He gave mention to France’s ban of fracking.

“It was the first country to ban it legislatively. It showed how important electoral cycles can be. The administration is now gathering data from license holders to ensure that they will not use fracking. It’s potentially a very large source considering security of supply. This example shows how the different drivers work.”

He noted that South Africa also imposed a moratorium while the UK government had generally been pro fracking.

“Then there was the Cuadrilla earthquakes issue,” added Mr. D’Ancona, “whether or not there was any linkage. The Dutch government is watching across the North Sea very closely. The German federal government is broadly pro fracking, although Westphalia has imposed a moratorium.”

He said that his firm M-Communications worked with companies and how they talked to the press. “The first thing to say is it’s a really mixed bag, in terms of the type of response and where you get it.”

He showed a number of newspaper clippings whose issues included water supply issues, lack of regulation, etc.

“The press hasn’t yet adopted a single view - there’s not yet ‘the answer’. In communications it’s not a done deal yet,” he said of how shale gas was portrayed.

D’Ancona also offered up how Cuadrilla was appearing in the UK press, showing examples of the Telegraph - which highlighted the potential of jobs created by UK shale gas - and the Independent, which wrote that it was “not a risk that is worth Britain taking.

“It really makes the point of the contrasting views that are out there.”

“The national view is not always the local one,” he pointed out. “Anti-fracking is not getting huge traction in the north of England. They have established ‘Camp Frack’ but it’s not populated by locals.”

According to him, in the U.S. the debate was by far the most advanced, because of Gasland. “Even despite that you still see the differences in the press: USA Today is mildly supportive; the NYT has had a series of anti-fracking articles,” he explained.

He said the latter was propelled by perceived concerns over the contamination of the watershed that serves New York City.

D’Ancona noted the new, powerful tools being used by anti-fracking campaigns.

He explained: “Local news can actually grab the agenda, things can go viral much faster than in the good old days. Twitter, Facebook and Google are being used to find like-minded individuals."

“You are all aware of the riots in London, which emerged from online tools. This gave police a challenge they’ve never before confronted.”

In France, he said, there was very strong digital media usage by the anti-fracking campaign and added that it could be difficult to differentiate a passing “e-commentator” from someone who really has some drive to influence the debate. “It’s a challenge to anticipate and pre-empt,” he commented.

He said that blogs and e-forums were places where information on how to campaign was shared.

“An online petition directory enables people to go to the most popular, active petitions. You can find where most people are campaigning on issues,” said D’Ancona. “Tools like this have become part of the online conversation.”

He delved into the semantic of the fracking issues, giving “reach drilling” as an example: “Nothing’s changed about horizontal drilling, just the way we talk about it.”

Offering up definitions, he said “conventional” was something which was customary: “It’s the done thing. ‘Unconventional’ does not adhere to the convention - it is out of the ordinary.”

He listed the resources that had been termed unconventional, saying not every company agreed on the list, which included shale oil and gas, oil shale, oil sands, coal bed methane, heavy oil, gas hydrates, tight gas and complex gas and enhanced oil recovery.

“Unconventional is also the ability to make something economic,” he added.

D’Ancona asked, “How can the industry make the unconventional conventional and remove the fear factor, demystify it? The good old passage of time could have something to do with it and can deliver some comfort."

“It’s become a proxy for a whole host of issues,” he said of hydraulic fracturing, “like climate change. So you go from this one operation done two miles under the ground to a whole debate: ‘Is it worth drilling for these unconventionals? What does it mean for security of supply?"

He stated that the industry’s attempts to normalize fracking’s use would in large part depend upon the success of its communications strategies.

Then he showed an actual trailer to delegates in attendance of Gasland.

“Whatever you think of the film, it’s brilliantly constructed and it received an Oscar nomination,” said D’Ancona. “But when you drill down into it, there’s an instinctive lack of trust in oil companies. It portrays big business in the worst possible light. It’s clever and uses that ‘disaster movie, end of the world’ cut between newscasts. It uses the presumption of environmental impact. Pro-fracking people are portrayed as untrustworthy, disingenuousness.”

He said the film plucked at the heartstrings, as its banjo imagery and soundtrack appealed to old American values, not to mention the home movie style footage.

“There’s a focus on ‘Joe Sixpack,’ with very emotional stories, mostly surrounding the industry’s bad completion of wells.

“There’s no time given to any of the professionals of the industry, none of the plusses like jobs or the money going to landowners. It never attempts to resolve the issues, but points the finger at issues like well casing,” he explained.

Then D’Ancona showed a Gasland rebuttal of sorts produced by America’s Natural Gas Alliance. In its video, the group called for an “open, factual and fair” dialogue and called Gasland a flawed documentary.

According to the rebuttal, flaming taps were a common phenomenon; it noted the Colorado Regulatory Commission had issued a report denying any link to hydraulic fracturing. Meanwhile, it said an EPA study attributed the dead fish in another Gasland scene to discharge from a nearby coal mine.

Of the rebuttal film, D’Ancona said, “It’s content is all the stuff that Josh Fox dished out. It’s guilty of indulging itself, sees its own lines of attack and pursues them. It wouldn’t look out of place as a cinema trailer.”

“It addresses the fear and loathing points that Gasland communicates,” he continued. “It dispels myths and focuses on ‘facts, facts, facts.’ Natural gas is portrayed positively and as the route to a reduced environmental footprint, to get you to a low carbon era.”

He said the latter video played on the “How are we going to keep America going?” sentiment, presenting shale gas as “a gift, an opportunity.”

“We’ve seen some of the challenges,” he said. “Clearly this has become a higher and higher profile issue and needs a strategy going forward.”

Among the main issues, according to him, were earthquakes, which he called a “catch all” for wider environmental impact.

“There’s concern that fracking can have on the geology of an area, like Cuadrilla in Blackpool,” he explained. It challenges Cuadrilla to prove the un-provable. How do you say ‘we weren’t responsible’? How do you prove it wasn’t you? The government is busy compiling a report. It’s a real challenge for a company.”

D’Ancona said that drilling had resumed in Blackpool and there was the potential for 200 TCF of gas, moving the issue up the public agenda.

“It’s a real game changer and actually front page news. With that potential resource, the story has gone from being page 10 to page one.”

Elections was also a factor with which E&Ps could be confronted, he said.

“Elections should be avoided like the plague,” said D’Ancona. “Forthcoming elections absolutely sensitize politicians to community concerns. France is a perfect example of this. France had an immediate reaction at a local level and there are presidential elections next year, and all the candidates made it a national issue as well. It certainly raised the volume.”

It was a question, he said, whether the electoral effect on shale gas would be less distorted where securing national energy supply was seen as more urgent. He added that Germany’s step away from nuclear would be interesting and could change the agenda there.

Next on the agenda: environmentalists.

“The fact that NGOs are organized now, media savvy, experienced campaigners, well informed, means you’re dealing with a professional group of stakeholders,” he said, offering Greenpeace’s success in its campaign against Cairn in the Artic/Greenland.

“In France there are a variety of locally based green groups, some of whom organized an invasion of the Toreador office,” D’Ancona recalled. “They’re well organized and their use of digital media changed the game incredibly.”

He added that green websites, social media, and the syndication of local news comprised a digitally enhanced voice for such groups, whom he believed understood their audiences.

“Their campaigns are designed towards ‘blockbuster’ concerns,”

It was a question, according to him, whether environmental groups represented the interests of locals.

He went on to question fracking’s health, safety and environmental record, explaining that it had become a proxy for three big issues: global warming, carbon issues and big business.

Mr. D’Ancona showed some quotes demonstrating how “fracking” was the hot button issue. He said, “It’s very important to make the distinction between drilling and fracking as the case against fracking is unproven – we have yet to see a definitive case.

“What we do see are accidents, like poor well completion, surface chemical spills, well pad footprint, surface blow outs and rig fires,” he continued, saying that where Gasland was very clever was that it used lots of these issues and blurred them. “It’s very clever the way Josh Fox does that.”

“Every time there is a failure on the HSE front it gives an opening to the anti-fracking front. So industry must do better in communicating better,” he explained.

Establishing communications priorities was part of the “nuts and bolts,” said D’Ancona.

“We’ve listed what we think may be communications priorities, from experience of working with companies, like environmental impact. A subset of that is water usage, use of local water supplies in places like France and South Africa.”

In terms of economic benefit, he said that both local and national operators need to do better on it. “It’s really essential; if people can understand why exploitation can be a good thing, it provides a newer cheaper energy source for industry."

Security of supply was fundamental in places like Poland, he commented.

Commodity price risk and landowner mineral rights were not to be forgotten.

Mr. D’Ancona presented a list of issues that M-Communications felt were of highest priority for the industry, assigned delegate tables different countries and asked each group to assign a value to each of them.

After the discussion at each individual table, he noted that some of the same issues kept cropping up: environmental impact, security of supply, landowners rights, and water usage, among others.

He said that national debate on shale gas should be largely driven by trade associations and industry lobby groups and the larger operators from an industry perspective. And E&Ps he said should shape the local debate in the regions where they operate, otherwise there would be a vacuum filled by naysayers.

“This means from an industry perspective you have to be very flexible, very fleet of foot.” In the US he said it could depend on the legacy of E&P in a specific state.

D’Ancona added: “Once you’ve assessed your priorities, you need to develop a tool kit.”

He said there were clear examples that operators now understood that they must engage with key stakeholders, and that industry bodies were talking more openly about the need to communicate with communities and NGOs on chemical disclosure.

Shell was an example for him. He mentioned that the company covered core areas like safety, water, air, footprint, and community. He also offered up Halliburton’s ‘Environmental Technology for Fracturing’ tab on the company’s home page.

“You must develop your own communications operating principles: long term planning is essential. You need to identify the issues, how you’re going to do it, and from the community perspective. Consider the interplay between local sentiment and the national political regulatory environment.”

Among his key points were taking a more transparent approach to describing operations.

“Small things can make a huge difference,” explained D’Ancona. “Will large trucks screw up transportation in a small village?”

Education was also crucial: “Don’t duck the environmental issue, you need to take it head on. Explain that drilling and fracking are not the same thing. That’s a real goal.”

He added: Don’t use techno babble; appear human, and be concerned; and define key stakeholder groups.

“Look at their different interests and concerns, because they probably won’t be the same. There are a ways of different ways to communicate with different interest groups. The range of stakeholders is growing all the time, among them local communities and local journalists,” explained D’Ancona.

Identifying and prioritizing communications issues and detail and preparation were essential to communicating effectively, he added.

“Don’t look like stereotypical ‘evil’ oil executives, and don’t be hostile to difficult questions.”

“There is a potential for shale gas to be a complete game changer in the UK,” he concluded, “but some people are questioning the impact on the environment, and there’s the question of jobs, etc. It will be fascinating to see how this conversation develops in the UK.”

Reported from Krakow by Drew Leifheit

 


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