Shale Gas Benefits Outweigh Risks

Michelle Remo, “Big 4″ observer
December 22, 2011 /

A majority of Americans think developing natural gas by tapping shale formations offers greater rewards than it does risks, including those associated with hydraulic fracturing, according to a survey conducted by the Deloitte Center for Energy Solutions.

Moreover, 8 in 10 respondents link natural gas with job creation and economic revival.

Specifically, 83 percent of respondents agree that natural gas development can stimulate job growth in the United States, while 79 percent believe the development of natural gas resources can help revitalize the economies of the states and communities where shale gas is located.

Further, the survey indicates that the public associates jobs in the natural gas industry with good pay. More than half (56 percent) of respondents in areas where shale gas development is planned or underway believe that jobs producing gas from shale formations command a “much” or “somewhat” higher pay grade than the average in their communities. The number jumps to 62 percent when looking at relatively mature shale regions like Texas.

Peter Robertson, an independent senior adviser for oil and gas at Deloitte, points out that the role of natural gas in job creation and economic revival is only going to grow as production of shale gas ramps up.

Citing a separate Deloitte research project, Robertson points out that “shale gas made up a small share of domestic natural gas production in 2005, but has surged since then – and in 2010 made up 20 percent of what is produced domestically. By 2030, the portion could be close to 50 percent.”

Shale benefits seen to outweigh risks

Only 2 in 10 respondents (19 percent) feel the risks of developing shale gas “somewhat” or “far” outweigh the benefits; 58 percent believe the benefits outweigh the risks; and almost 25 percent are unsure.

Moreover, a clear majority of respondents (58 percent) in areas where shale development is underway or planned would recommend that their family and friends lease their land to a shale gas developer. In fact, 7 in 10 survey respondents (71 percent) in established shale areas like Texas, Louisiana and Arkansas would advise family or friends to lease their land to a natural gas developer.

The survey consisted of 1,694 online interviews conducted in November 2011 with adults age 21 to 74 and examined three different audience segments: residents of areas where shale gas development is an established phenomenon, specifically Texas, Louisiana and Arkansas (537 respondents); residents of areas where shale is a newer phenomenon, specifically New York (89 respondents in New York City and 162 in western New York State) and Pennsylvania (243 respondents); and finally, the survey canvassed an additional 663 respondents in the United States nationally.

Shale seen to improve energy independence and air quality

The survey also indicates that shale gas could play an increasingly important role in making America more energy independent: Respondents with at least some degree of familiarity with shale gas development view energy independence as the single most important benefit of shale – ahead of all other benefits, including: boosting the national economy, job creation, cleaner air, and boosting local economies. And a near majority (47 percent) of national respondents believes shale is “extremely” or “very” impactful on energy independence.

Strong need for better dialog, more information on shale
Still, the road to increased shale production is likely to be rocky. There is controversy about the environmental impact of shale development and heated rhetoric – all of which was reflected in Deloitte’s survey.

Most notably, respondents are not familiar with the processes involved in shale gas production: 37 percent of national respondents report being “not very” or “not at all” familiar with hydraulic fracturing – and 23 percent “never heard of hydraulic fracturing.”

Nonetheless, a large percentage of the public is aware of the dominant concerns about shale development. 58 percent of national respondents with at least some degree of familiarity with shale gas development are aware of potential water contamination issues and 49 percent know about the potential for surface-land impact issues.

Curiously, while the news media is seen as the primary source of information on shale (much higher than sources like word-of-mouth, non-profits, industry websites, academics and town hall meetings), it is not trusted: 73 percent of respondents nationally get information about shale development from the news media, yet only 17 percent see the media as “extremely” or “very” trustworthy when it comes to providing unbiased coverage of the natural gas industry.

At the same time, respondents in areas where shale gas development is planned or underway indicate that oil and gas production companies need to communicate better. While nearly half (45 percent) believe shale gas producers are “somewhat” transparent and open, just 35 percent believe shale gas companies communicate “extremely” or “very” effectively. Only 34 percent see shale gas companies as “extremely” or “very” trustworthy.

Interestingly, the survey shows that there is faith that the shale development is currently being regulated appropriately: 54 percent of respondents nationally believe that regulation of shale development is “just right” or “evolving, but on the right track.” Approximately 20 percent think there is too much regulation and 16 percent think there is too little regulation. Ten percent are not sure.


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