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    Romania: Politics and the Shale Gas Moratorium

Summary

Romania's change in government at the beginning of May has shifted the vision and policy of shale gas exploration in the country. The new government would like to see a serious public debate and careful study with regards to the extraction of natural gas.

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Romania: Politics and the Shale Gas Moratorium

Faced with public protests, Chevron Corp. suspended the exploration and exploitation of shale gas deposits in Romania at the beginning of April.

The change of government at the beginning of May brought a new vision and policy, that being the view of the former parliamentary opposition.  When they were in opposition, current government had a more nuanced position on shale gas exploitation in Romania.

In assuming power, the current political leaders thought that shale gas development required a more serious public debate in which to consider the benefits and disadvantages, prior to Chevron commencing development. As a result, a moratorium on shale gas development has been proposed for Romania

Speaking with Natural Gas Europe, Prime Minister Victor Ponta said that "the subject of shale gas is put down in government program which brought the confidence vote of parliament.  Quality standards need to be carefully studied; the current government position will not be different from the position that European countries have towards this economic activity."

Opponents to Chevron's shale gas activities point to the dangers of hydraulic fracturing for both the environment and community. Natural Gas Europe discussed the issue of fracking in an interview with Dr. Octavian Coltoi, Geologist at the Geological Institute of Romania.

Q. How dangerous is the use of hydraulic fracturing technology to exploit shale gas?

A: You can not quantify something theoretical. If the drilling process does not strictly follow the appropriate rules and procedures, it is possible to have some issues (i.e. casing cementing failures, too high injection pressures, etc.)

Q: How do you assess the economic potential of shale gas in Romania?

A: This assessment takes into account the strategy of each company involved in exploitation of these clays (party type, degree of tectonic, thermal maturation of their depth at which these layers are, etc.).  According to different opinions of geologists working on shale gas or following U.S. example, from the economic point of view, the industry is profitable. However the input-output ratio and other advantages are known only to the players who work in market. Ulitmately only appropriate drilling will prove commercial aspects.

Q: Can you comment on the fact that meaures against hydraulic fracturing are already in place in countries like France, Britain, Bulgaria and Germany?

A: I cannot comment on the energy policy of these countries. But I can say that a consortium (Gash Project) is assessing and building a European database. Germany and Bulgaria are active members through their representing specialists. France and Britain actively participated in the first phase. Speculative, some countries may want to conserve their resources and want to exploit in other countries, perhaps waiting for operating results in other sedimentary basins from other regions that correspond to different oil systems.

Q: Are there are other technologies to extract shale gas that do not invlove hydraulic fracturing?

A: From what we know and from what I know so far, no. 

Q: Can you compare the environmental effects of shale gas extraction method (shale gas or other unconventional resources) with methods of extracting gas or oil?

A:  The injection process needed by hydraulic fracturing has been used for decades with the only failures, as described previously, appearing only during the drilling and by not fulfilling all the safety requirements. The differences would consist in surface, land used for site organization, to achieve those necessary utilities for water injection and waste water treatment. 

The decision to develop Romania's potential shale gas resources using the technology of hydraulic fracturing is a matter to be decided based on political will. 

Romanian President Traian Basescu has indicated his support of shale gas development, a matter he considers as an economic necessity. His statements have brought criticism from media analysts and Romanian media opinion makers.

A more nuanced position on the issue of shale gas exploration is expressed by Romanian MEP Victor Bostinaru, an important political figure who in terms of his activity in European Parliament, is familiar with approaches taken by other European countries on the gas shale issue.

In a discussion on the Romanian position, MEP Victor Bostinaru commented:

"All approaches to sustainable development have nothing in common with the utilitarianism of the moment. Moreover, the manner of granting the concessions (to Chevron) was made in a non-transparent manner and the existing documents do not refer to economic or social effects on local or national level. To this adds the fact that surfaces considered are very large and have a direct or indirect impact on surrounding areas, whether or not they are populated.

The question we should ask is whether an analysis of costs and benefits of this type of operation will benefit the community.  Although shale gas exploitation in the territory leased by Chevron would bring an added economic advantage by creating jobs and adding taxes or fees to the local budget, we must consider a long-term development strategy of these areas, the impact of these operations on the environment and human health.

In the same logic, a campaign of clearing forests in any of these areas would provide additional income immediately, but with disastrous consequences to the community.

Chevron's reaction indeed occurred following protests but the former government was not obliged by law to ensure the preconditions for such a decision: dialogue with communities, impact assessment, scientific assessment and analysis of cumulative effects compared with similar projects in other Member States Union. On this basis, a new government proposed a moratorium on the exploitation of shale gas."

The subject of shale gas exploitation and the use of hydraulic fracturing will be a large political and electoral issue in 2012.  One conclusion that can be drawn at this stage is that a conclusive desicion allowing or prohibiting the exploitation of shale gas will not be taken before the parliamentary elections in November this year.

Then, a new government invested with the support of a majority vote will decide on the matter.

By Silviu Molnar