Tight gas and oil
Tight gas and oil continue to play an important role in meeting global energy demand. We use advanced, proven technologies, including hydraulic fracturing, and follow our global operating principles to unlock these resources safely and responsibly.
Tight gas and oil resources are trapped in microscopic pores of very dense shale or sandstone rock, normally thousands of metres underground. Hydraulic fracturing has been used for many years in the oil and gas industry to extract tight gas and oil. The process fractures the rock and releases the gas and oil into the well.
The US Energy Information Agency states that tight gas and oil in the USA has boosted the production of natural gas by around 35% since 2005. This has reduced the need for gas imports. The increased use of these resources instead of coal in North America has helped to reduce carbon dioxide emissions.
Onshore operating principles
Some communities and environmental groups have raised concerns about the use of hydraulic fracturing. These groups question the high volumes of water used, the risk of chemical release into water sources and the potential release of methane gas or other chemicals into the air.
In 2011, we developed and publicly shared a set of five global principles that govern the onshore tight or shale gas and oil activities where we operate and where hydraulic fracturing is used. The principles cover safety, air quality, water protection and use, land use and engagement with local communities. We encourage regulations that set comparable standards. The principles are reviewed and updated as new technologies, challenges and regulatory requirements emerge. We share our global onshore operating principles publicly.
Each of our projects takes into account the local context – including the geology of the area and impacts such as noise and traffic – and we then design our activities to suit the local conditions. We have implemented technologies that reduce the environmental impact of tight gas and oil activities, including capturing methane emissions and improving the detection and repair of leaks. (See Managing methane emissions).
Collaboration
We strive to be transparent in our activities and work in partnership with communities and others in the industry to bring about improvements in the sector. For example, in the USA, we collaborate with the Center for Sustainable Shale Development (CSSD) and its members. These include environmental organisations, foundations and oil and gas companies. CSSD has developed 15 voluntary performance standards covering air quality, water resources and climate. Our tight-gas operations in the Appalachia region received CSSD certification in 2015.
We also work with the Environmental Protection Agency in the USA to contribute to discussions on effective regulations and programmes to reduce emissions. Significant reductions are being achieved by a combination of existing regulation and voluntary efforts by the industry.
Throughout 2015, Shell worked closely with industry, regulators and academics in Western Canada to address concerns about emerging risks of induced seismicity associated with hydraulic fracturing. Shell is working with industry partners, through the Canadian Association of Petroleum Producers, to develop best practice that includes monitoring, mitigation and response procedures to avoid or minimise seismicity potentially associated with hydraulic fracturing.
Listening and responding
There remain some concerns about the development of tight gas and oil resources due to the use of hydraulic fracturing. (See table).
Listening and responding to community concerns
Concerns raised by communities
Chemicals could be released into local water sources.
Shell operating principles
We always have at least two physical barriers in the section of the well that passes through the potable groundwater aquifer, to prevent the production stream from mixing with potable groundwater.
Examples in practice
In Appalachia, USA, we test the quality of water wells around our sites both before and after drilling to ensure we can detect any changes.
Concerns raised by communities
High volumes of water are used in hydraulic fracturing which can compete with other local water needs.
Shell operating principles
We design our operations to reduce the use of potable water and to use non-potable water as far as reasonably practical.
Examples in practice
Our Fox Creek operations in Canada have an agreement with the town to use their treated waste water in our operations. In 2015, we used around 60% alternative or waste water sources in our Fox Creek operations. Shell also funded a design study to upgrade the town’s natural water facilities.
Concerns raised by communities
Methane gas and other chemicals could be released into the air from hydraulic fracturing sites.
Shell operating principles
At many locations, we monitor production facilities and pipelines for fugitive emissions. This may be done by pressure testing, visual observation, infrared testing or other emerging technologies.
Examples in practice
In Appalachia, USA, we introduced a number of voluntary measures at our sites to reduce methane emissions. These exceeded local, state and federal air quality regulations. Around 90% of our surface facilities have low-emission devices to reduce fugitive emissions.
Concerns raised by communities
Noise and traffic could affect local communities.
Shell operating principles
We work to understand and reduce the impact of our operations on communities, wildlife and livestock. This includes limiting our activities during specific times.
Examples in practice
At our sites in Permian, USA, we invested in pipelines and water recycling facilities. This has significantly reduced the number of trucks coming to our site.
Concerns raised by communities
Effects of operational land use on local communities.
Shell operating principles
We assess the impacts of our operations on the social and economic aspects of the community and find ways to reduce the effects and identify the opportunities.
Examples in practice
Shell proactively engages with First Nations in Canada to understand traditional land use and help reduce impacts on culturally-sensitive areas or areas used for traditional purposes such as fishing and hunting.
Concerns raised by communities
Hydraulic fracturing activity could cause seismic events that damage infrastructure and threaten public safety.
Shell operating principles
Shell analyses publicly available seismic, geological and geophysical data to determine historical seismicity in areas where we plan to operate. If seismic activity beyond historic levels is detected, we will investigate and review our operations.
Examples in practice
We support appropriate local regulations based on local geology and surface conditions, to manage the risk of induced seismicity in areas where we operate. To date, we have not experienced any induced seismic events from our Shell-operated water injection or hydraulic fracturing activities in North America. We have also introduced guidelines to help avoid or minimise induced seismicity.
