Industry-backed platform calls for Germany to allow fracking

Fracking sign
Source: DollarPhotoClub

Shale Gas Europe, a media platform supported by Chevron, Cuadrilla Resources, Halliburton, Shell, Statoil, and Total Gas Shale Europe, has called on Germany to embrace shale gas exploration.

The German Government is currently progressing draft legislation which outlines a proposed regulatory framework on hydraulic fracturing. It sets out new guidelines as to how the exploration and production of shale gas could be carried out in Germany. It is currently under review and internal consultation and is not expected to be formally published until later in 2015.

In a press release published last week, Shale Gas Europe stated that “the German Government’s draft legislation is a step in the right direction. But investors need clarity and certainty and the proposed policy framework fails to deliver either. It raises more questions than answers and the country cannot afford to wait to access a potentially important new source of domestic energy.”

When it comes to energy, Germany, ‘the power-house of Europe’ is in a quite precocious position. Having turned its back on fracking and nuclear power, the country is now paying some of the highest prices in Europe, is becoming ever more reliant on foreign imports as domestic production continues to decline and is using increasing amounts of coal to meet its energy demand, undermining its ambitious environmental targets.

As the press release points out, with its Energiewende policies potentially costing up to €1 trillion by 2040, almost half of Germany’s current GDP, the Government urgently needs to deliver some practical and pragmatic solutions to ensure a reliable, secure and affordable supply of energy to power Germany’s homes and industries.

Shale Gas Europe believes that the 2.3 trillion cubic metres of estimated domestic shale gas reserves could provide a realistic solution to Germany’s problem. Whilst more exploration is required to confirm these reserves, this would be the equivalent of up to 23 years of domestic energy supply based on current demand.

It is also worth reminding that although shale gas exploration is banned in Germany, fracking is not. Hydraulic fracturing has been taking place in Germany since the 1960s. It is, however, restricted to the depths of more than 3,000 metres.

Consequently, the press release argues, shale gas can help reduce the country’s rising dependence on more carbon intensive fossil fuels, reduce its CO2 emissions, facilitate the move away from nuclear power and help with the transition towards renewable energy sources. It will also attract considerable investment and create a significant number of new jobs.

Whether Shale Gas Europe’s arguments get any traction in Germany is difficult to say.  Only last month, German Environment Minister Barbara Hendricks dismissed rumours that Germany might relax the fracking ban imposed in 2012. While measures on fracking are currently being debated in the Bundestag, the German government is quite adamant that the current ban will not be reviewed before 2012.

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