Doug Bailey site manager of Corridor Resources Inc. production operations works at a well pad in Penobsquis, N.B., Sept. 5, 2013. New Brunswick is fracking’s newest battleground, but Mr. Bailey says relations with the community are ‘relatively good,’ and the company closely monitors its operations with sensing equipment to ensure safety.The Globe and Mail
New Brunswick is fracking's newest battleground.
The thick layers of shale rock that lie beneath much of this province are believed to contain enormous amounts of natural gas, a prospect that has energy companies lining up to drill.
But that has sparked a fevered reaction among local citizens. Across the province, an emotionally charged debate is raging over the safety of hydraulic fracturing, known as fracking, the controversial technique that uses chemically-laced, high-pressure water to blast open fissures in impermeable rock and allow the recovery of natural gas.
The technique sparked a boom in North American production that drove down gas prices, bringing consumers lower fuel costs and forcing massive changes to the industry.
The standoff in New Brunswick divides those who are eager to exploit the promising but unproven resource to boost the struggling economy, and those who fear the environmental and health impacts from a largely unfamiliar industry.
Companies have faced outbreaks of vandalism in some areas, as well as threats of blockades, as land owners and other critics complain about potential contamination and disruption from development.
It is still early days for province's fledgling shale gas industry. Facing the opposition, several independent energy companies are moving cautiously to assess the commercial potential of the resource, which is thought to be plentiful but may be too costly to extract, especially at today's low prices.
Houston-based Southwestern Energy Co. holds the lion's share of the outstanding licences that cover fully one-seventh of the province, but it is still conducting seismic testing and does not expect to drill a well until late 2014.
Halifax-based Corridor Resources Inc. is the sole producer in New Brunswick – coaxing a modest amount of gas from a tight sandstone formation in Sussex County – and the company expects to drill one well, or possibly two, into the deeper, potentially more prolific shale this winter.
The province's Progressive Conservative government is holding out high hopes for its own shale gas revolution, arguing that there is enough resource in the ground to supply New Brunswick and neighbouring Nova Scotia – where offshore gas supply is expected to decline after 2020. It is due to introduce a new fiscal regime in this fall to attract investment.
"We do recognize that we're going to be a greenfield operation here . . . and that there will be extra expenses for producers," Energy Minister Craig Leonard said in an interview. "We will have to take that into account but, as gas is produced, we want to ensure we obtain a fair share for the province that is the owner of the resource."
Critics, including Opposition Leader Brian Gallant, are demanding a moratorium on the fracking, insisting the environmental impacts remain poorly understood.
Amid the dairy and pig farms near the village of Penobsquis in Sussex County, Corridor Resources has drilled and fracked 40 gas wells into the shallow sandstone formation of the McCully field, and is producing 11-million cubic feet a day of gas from 21 of them. Corridor site manager Doug Bailey says relations with the community are "relatively good," and the company closely monitors all wells with the most up-to-date sensing equipment to ensure they are safe.
Corridor hopes to bring in larger partners and spend some $100-million over the next few years to know whether the resource can be profitably extracted.
As the company plans to expand its drilling program, some local farmers have concerns about the effect on local water and air quality, as well as truck traffic and a related disturbance in their fields.
Sitting at a neighbour's kitchen table just a few kilometres from Corridor's small processing plant, Beth Nixon says many people are afraid to speak out because they have to deal with the company, but they aren't confident the government is looking after their interests. "There seems to be very little government oversight," she said, adding, "It seems like the deal is fixed."
Into that chasm has stepped Louis LaPierre, a retired University of Moncton environmental science professor who this summer took on the chairmanship of the newly formed New Brunswick Energy Institute, which aims to turn down the emotional heat with a scientific approach to the fractious debate.
"People do not have confidence in government and they do not have confidence in industry because they find they provide information that supports their initial objective and that government are often times following industry because of the need for industrial development and job creation," he said. in an interview in Moncton.
"If you're going to have any chance of getting a social contract, people need to be assured the ground water will not be polluted, and that if there is an accident, it will be addressed."
But Dr. LaPierre does not support a moratorium, arguing exploratory drilling and peer-reviewed research is needed to better understand both the potential rewards and the possible risks.