In 2021, the EU imported ~155 billion cubic meters (bcm) of natural gas from Russia. Unfortunately, the proposed gas replacements from the block to the end of 2022 — which include LNG (liquefied natural gas) diversification, renewables, heating efficiency, pipeline diversification, biomethane, solar roofs and heat pumps — only amount to around 102 bcm per year, according to data from the EU Commission’s REPowerEU. Proponents of fracking argue that Europe’s shale gas potential is needed now more than ever, although Germany, France, the Netherlands, Scotland and Bulgaria have all banned fracking in the past. Now, the debate is being rekindled by recent moves in the UK. New British Prime Minister Liz Truss has announced that the UK is lifting a 2019 moratorium on shale gas fracking as the country seeks to boost domestic energy resources and help households and businesses struggling to pay soaring energy bills. The lifting of the fracking ban comes just three years after the government ended its support for fracking after the oil and gas industry watchdog found that “it is not possible with current technology to accurately predict the likelihood of tremors associated with with fracking”. Britain has only two shale gas wells in Lancashire operated by Cuadrilla Resources. Cuadrilla chief executive Francis Egan welcomed the lifting of the ban, saying: “This is a perfectly sensible decision and recognizes that maximizing the UK’s domestic energy supply is vital if we are to overcome the ongoing energy crisis and reduce the risk of its recurrence in the future. Without the strong measures set out today, the UK was set to import over two-thirds of its natural gas by the end of the decade, exposing the British public and businesses to further risk of supply shortages and price rises.” Despite its desperation, the rest of Europe is unlikely to follow – even if the revival of the debate has reignited the debate about how much shale potential Europe has and why it is not being tapped. Shale gas in Europe Europe has more recoverable shale gas than the US, according to estimates. However, the only significant fracking activity is in Ukraine, which managed to wean itself off Russian gas years ago. Fracking in Europe has long been a contentious issue due to population density, in large part. This is not North America. In 2016, Cuadrilla Resources won permission to frack up to four wells in the UK, ending long-running battles with local authorities. Five years earlier, the company had been forced to halt drilling after the government placed a one-year moratorium on fracking due to vibrations caused by a Cuadrilla exploration rig in northwest England. In 2013, the company’s drilling activity was halted again after hundreds of protesters camped out in a tiny village south of London and forced it to abandon its wells. Meanwhile, in 2012, protesters in Zurawlow, a town in eastern Poland, successfully blocked a fracking site while Greenpeace activists occupied a shale gas rig in Denmark. Strong public opposition — along with tax concerns, regulatory delays and poor performance from a handful of test wells — drove away investors. Exxon Mobil (NYSE: XOM ), Chevron (NYSE: CVX ) and TotalEnergies (NYSE: TTE ) were forced to abandon projects in Poland after exploration proved disappointing. Poor gas flows have also halted progress in Denmark, with Total abandoning shale gas drilling there. The big problem with fracking in Europe is that some of the conditions that fueled the US shale boom don’t exist in Europe. In most countries, it is the state, not private landowners, that owns the mineral rights to the oil and natural gas in the ground. Contrast that with the US, where the landowners’ cut can be as much as one-eighth of production revenue. This essentially means that fracking does not bring big financial rewards for European landowners. To garner more public support for the technology, the British government and some companies have previously proposed direct payments to people affected by fracking. However, environmental groups have strongly opposed the move, labeling such payments as bribes. The situation is not helped by the fact that the population density in Europe is more than 3 times that of the United States, fueling protests that are not in my backyard. For example, many agricultural projects in the past have been rejected because they would bring trucks and equipment used for fracking on scenic roads dating back to Roman times. Indeed, Gazprom has previously said that the difficulty of finding uninhabited land in Europe and enough water to exploit shale drilling will help Russian gas remain competitive. Even better for Russia: it can produce natural gas for about one-sixth the break-even cost of British shale. Even after decades of fracking in the US, many Europeans still regard the technique as untested. It will be interesting to see if record energy prices finally convince Europeans to change their minds about shale gas fracking. Several European nations have already backed down and gone back to burning coal at record levels to keep their electricity grids alive, thereby breaching their climate targets. But here’s why environmentalists may be sticking around: studies have shown that although natural gas burns cleaner than coal and has reduced greenhouse gas emissions, the fracking process can negate those benefits. Fracking is dirtier than burning coal, mainly because of the direct emission of harmful carbon dioxide and methane, both potent greenhouse gases. By Alex Kimani for Oilprice.com More top reads from Oilprice.com:
