11

Dr Jan WrightParliamentary Commissioner for the

Environment

10 December 2012

Strategic issues facing New Zealand and overview of report

on fracking

22

www.pce.parliament.nz

3

The big strategic issue – climate

Energy…

Renewability is not the issue.

Carbon footprint is the issue.

4

Investigations into energy

• Smart meters• Biofuels• Lignite• Hydroelectricity or wild rivers?• Solar water heating• Fracking

5

The strategic issue for conservation

• Mining on the conservation estate?

• Pests – plants and animals

6

Pests - the big conservation issue

7

Water quality

7

8

Evaluating the environmental impacts of fracking in New

Zealand:An interim report

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What is fracking?

Hydraulic fracturing

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Using pressurised liquid to crack rock

10

Porous and permeable Porous, but not permeable

1111

Rock Layer

Fresh water

Rock Layer

Gas, oil and brine

Rock Layer

Salty water

12

Fracking in New Zealand

• Tight sands in Taranaki

• Coal seam gas

• Shale in east of the North Island

13

A well from birth to death

• Choosing where to drill• Establishing the well site• Drilling and constructing the well

• Fracking the well• Flowback and transition into

production• Dealing with waste• Abandonment

14

Choosing where to

drill

15

Establishing the well site

16

Drilling and constructing

the well

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Fracking the well

18

Flowback and transition to production

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Disposing of waste

20

Ending production and abandoning the well

21

A well from birth to death

• Choosing where to drill• Establishing the well site• Drilling and constructing the well

• Fracking the well• Flowback and transition into

production• Dealing with waste• Abandonment

22

Earthquakes

• Fracking itself – tiny

• Fracking fluid into active fault

• Reinjected wastewater into active fault

23

Water contamination

• Spills and leaks on surface

• Well failure

• Migration

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Four things to get right

1. Choose the well site carefully

2. Design and construct wells to prevent leaks

3. Prevent spills and leaks on the surface

4. Store and dispose of waste with care

25

1 Watch where you drill

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Active faults

2626

2 Well integrity

Rock Layer

Fresh water

Rock Layer

Gas, oil and brine

Rock Layer

Salty water

2727

3 Spills & leaks on the surface

2828

4 Disposing of waste

29

Fracking and climate change?

Is gas from fracking a bridge to a low carbon future?

• On the one hand – better than coal

• On the other hand – worse than renewables

30

Fracking better than coal

31

Lignite and NZ’s Copenhagen commitment

32

Lignite and NZ’s Copenhagen commitment

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Fracking worse than renewables

34

More gas use?

35

Government oversight and regulation

• Complexity and accountability

• ‘Light-handed’ regulation

• A ‘social licence’ to operate

35

36

The environmental risks associated with fracking can be managed effectivelyprovided:

“operational best practices are implemented and enforced through

regulation”UK Royal Society (2012)

36

Interim conclusion

3737

Questions about the future

38

Thank you

38www.pce.parliament.nz