UK fracking report finds “quite exceptional” earthquake results at controversial site

A report examining two minor earthquakes near the Preese Hall hydraulic fracturing (fracking) well in Lancashire, UK, has found that the tremors were two orders of magnitude stronger than those normally observed from fracking, which it called “quite exceptional”. The report, commissioned by Cuadrilla Resources, the energy company specialising in unconventional sources that started test drilling the site, said the tremors were most likely caused by the direct, high pressure injection of fluid into the gas wells causing slippage of the local land fault. Based on the seismic observations, the report said it predicted a maximum worst-case tremor of 3 on the Richter Scale; tremors of 4 or below rarely cause damage. The two earthquakes reported so far have been at magnitudes of 2.3 and 1.5, with 48 much weaker events detected also.
Link to report
Hydraulic fracking has become a significant ESG issue for institutional investors with many large oil and gas companies citing it as a significant source of future revenue against a backdrop of safety concerns and regulatory activity. The French government voted last summer to ban fracking, the first country to do so. The US states of New York and New Jersey have placed temporary moratoria on fracking while safety tests are carried out.A recent report by Sustainalytics said the US Environmental Protection Agency EPA was undertaking a Hydraulic Fracturing Study to understand the relationship between hydraulic fracturing and drinking water resources with initial research results expected by the end of 2012.
In the UK, Cuadrilla believes there are 200 trillion cubic feet (tcf) of “shale” gas in the Bowland basin, the site of Preese Hall. It has said estimates suggest Britain could have more shale gas than Poland, which has been considered Europe’s biggest holder of probable reserves. Cuadrilla is waiting for the UK government to decide whether it can restart drilling. In the US, estimates of proven US shale gas reserves by the US Energy Information Administration (EIA) have risen from 34 tcf in 2008 to 84 tcf in 2011 with a total of 862 tcf proven and unproven resources. Production is forecast to reach 12.6 tcf by 2020. A report by MSCI said so-called ‘flowback’ water consisting of fracking fluids and substances picked up underground such as hydrocarbons and heavy metals present significant operational challenges to fracking as a result of land movement. As fracking occurs at about 9,000 pounds per square inch pressure or greater, poor well casing, it said, can also provide a path for gas migration underground as well as aquifer contamination, all of which have been cited as major concerns by anti-fracking campaigners.