Fracking Takes Center Stage in Quebec Shale Gas Development

crusher plant installation cost in India Quebec’s new natural resources minister has wasted no time in criticizing hydraulic fracturing or “fracking,” the process of extracting natural gas from shale.

Martine Ouellet, part of the province’s new Parti Quebecois (PQ) government, stated less than 24 hours after being named to the new cabinet that she believes fracking cannot be undertaken in a safe manner. Comments that the government is planning to implement a long-term ban on shale-gas exploration and production in Quebec have added to investor concern.

Controversial comments

Ouellet’s position allayed the concerns of those who think fracking might contaminate drinking water — a claim that led to a temporary moratorium on the practice in the province last year. But it is also proving controversial as industry players have noted that the provincial government stands to lose approximately $1 billion in royalties from shale-gas development annually if the practice is banned.

“I don’t foresee a day when there will be technology that will allow safe exploitation (of shale gas),” Ouellet said in Quebec City. “Our position is very clear: we want a complete moratorium, not only on exploitation but also on exploration of shale gas. We haven’t changed our minds.”

Investors will no doubt be assessing what the move could mean for companies operating in the region, as well as for potential future exploration and production opportunities. A complete moratorium on fracking could prove to be a step backward for the province as most other North American regions have opted to improve extraction technology and implement regulations, rather than write the practice off completely.

Moratorium already in place

Former premier Jean Charest imposed a partial moratorium on gas exploration in early 2011 so that a strategic environmental study could be undertaken to evaluate the risks of hydraulic fracturing. The practice involves injecting chemicals and water below ground to free natural gas from rock formations. It has been argued that the practice could contaminate ground water with chemical pollutants. The Strategic Environmental Assessment (SEA) is expected to be completed in 2014 at an estimated cost of $7 million. crusher parts suppliers in India Opposition to shale-gas development has remained fierce in the province even with the assessment underway, with critics labelling the mandate for the SEA as too broad and for not placing enough emphasis on justifying the province’s need for natural gas.

According to the official document outlining the SEA, the assessment will evaluate the environmental risks and impacts associated with this type of exploitation, the impact of eventually developing the shale-gas sector and the socioeconomic desirability of exploiting this resource.

Quebec currently consumes on average approximately 700 million cubic feet (Mcf) a day of natural gas, with volumes surging during winter periods and dropping off in the summer. The province’s Utica shale is estimated to hold approximately 220 trillion cubic feet of gas, which, while significant, remains second tier in comparison to other shale plays found across North America, including the Marcellus or the Montney.

Self-interest at play

In comments to the Financial Post, Ed Kallio, director of gas consulting at Ziff Energy Group, said that the shale-gas ban may in fact have been motivated by self-interest — Quebec owns Hydro-Quebec, the main power utility. Interestingly, prior to entering politics, Ouellet was an official at Hydro-Quebec.

“The last thing Quebec needs is more gas,” Kallio said. If “the gas price goes down, so does the power price. They are really exposed to low gas prices.”

Ouellet’s statements reflect the PQ government’s openly harsh stance on the gas and mining industry leading up to recent elections. During the campaign, the PQ, led by Pauline Marois, confirmed that it plans to reform the province’s mining regime, a move that is expected to be costly for companies and investors.

“Very bad message to investors and developers”

“If her decision is taken even before the studies are completed, it sends a very bad message to investors and developers,” Yves-Thomas Dorval, president of the Conseil du Patronat du Québec, the province’s lobby for big business, told The Globe and Mail.

“At some point, Pauline Marois is going to need revenues, and she is going to realize that she cannot keep on alienating business leaders,” added Lucien Bouchard, a former PQ premier who now presides over the Petroleum and Gas Association of Quebec.

Disappointment amongst industry players

Meanwhile, Michael Binnion, president and CEO of Questerre Energy (TSX:QEC), a company working on the Utica shale-gas play, moved quickly to quash investor concern following Ouellett’s remarks.

crusher machines for concrete mines in India In an open letter Binnion noted, “[w]e were disappointed to hear that the Minister does not believe modern completion techniques can ever be done safely. It is ironic since Quebec imports approximately 0.5 Bcf a day of natural gas from Western Canada that is safely produced using this proven, well-established technology.”

He added, “[w]e were especially disappointed the Minister would prejudge and put undue influence on the results of the existing and future environmental studies. However we were pleased to hear the Premier of Quebec agree that a study is necessary to evaluate all impacts.”

Talisman Energy (TSX:TLM), another firm with shale-gas interests in the province, confirmed that in spite of Ouellet’s comments, it is still hopeful that the PQ government will continue the review process that is already in process and draw up a legislative framework aimed at improving sustainable shale-gas development in Quebec.

“Our hope would be that Quebec continues to consider the process, to study it,” said company spokesperson Phoebe Buckland. “We would encourage Quebec to continue the process it has set out and continue to look at the options of developing shale gas in a way that would be safe and responsible.”

Gas Market Update

US gas futures rose early on Tuesday, lifted by nuclear power plant outages that have boosted near-term demand.

“We are viewing the market’s ability to hold up in the face of mild temperature forecasts and lack of significant storm threat as suggestive of one more price lift that could still carry October futures into the $2.90-2.96 zone prior to tomorrow’s expiry,” said Jim Ritterbusch, president of Ritterbusch and Associates, in a Reuters report.

As of Tuesday morning, front-month October natural gas futures on the New York Mercantile Exchange were at $2.866 per MBtu.

Canada could potentially one day export 9 billion cubic feet (Bcf) per day of LNG to Asia, Natural Resources Minister Joe Oliver told a Japanese audience last week.
crushing and mining equipment in India
In a speech to the Liquefied Natural Gas Producer-Consumer Conference in Tokyo, Oliver touted Canada as a rising “global energy leader.”

Oliver was visiting Japan and South Korea on a mission to drum up business for Canada’s fledgling LNG industry and is travelling with business executives from AltaGas (TSX:ALA), Encana (TSX:ECA,NYSE:ECA) and Nexen (TSX:NXY,NYSE:ECA).

The US Energy Information Administration last week said domestic gas inventories rose across the week by 67 Bcf to 3.496 trillion cubic feet.

The natural gas rotary rig count, as reported by Baker Hughes on September 14, fell by 4 to 448 active units.

Working natural gas in storage rose last week to 3,496 Bcf, according to the EIA’s Weekly Natural Gas Storage Report. crusher screen manufacturers India An implied storage build of 67 Bcf for the week positioned storage volumes 320 Bcf above levels seen at the same time last year.

Meanwhile, Israel held discussions with the Palestinian Authority (PA) regarding plans to develop a gas field off the coast of the blockaded Gaza Strip.

Prepared for a gathering of donors to the PA, the report, released on Sunday, said initial negotiations on the controversial issue have already begun.

New Cobalt Catalyst Can Split Hydrogen from Water

Researchers at the University of Cambridge have produced hydrogen from water using an inexpensive cobalt catalyst, the university said. The research is gaining attention because hydrogen can be used as a fuel in combination with fuel cells, which are seen as a growing source of green energy. demand for mineral washing and beneficiation plant in India

The scientists’ work is also noteworthy because the cobalt catalyst will work in conditions useful to industry. That means the catalyst uses fresh water, tolerates oxygen in the atmosphere and runs at room temperature.

Hydrogen is currently produced from fossil fuels, creating the greenhouse gas carbon dioxide as a by-product. Hence it is neither renewable nor clean. “A green process such as sunlight-driven water splitting is therefore required to produce ‘green and sustainable [hydrogen],’” the University of Cambridge said in a statement.

The cobalt catalyst comes in handy because until now scientists have had a tough time finding an efficient and inexpensive catalyst that can function under real-world conditions — using pH neutral water, surrounded by oxygen and at room temperature. Currently, highly-efficient catalysts such as platinum are too expensive and cheaper alternatives are inefficient, the researchers said.

“Our research has shown that inexpensive materials such as cobalt are suitable to fulfil this challenging requirement,” Dr. Erwin Reisner, the lead author of the research and head of the Christian Doppler Laboratory at the University of Cambridge, said in a university circular. “Of course, many hurdles such as the rather poor stability of the catalyst remain to be addressed, but our finding provides a first step to produce ‘green hydrogen’ under relevant conditions.”

While it is too early to tell what impact this development will have on demand for cobalt, new applications for cobalt are generally seen as positive for the mineral, which is in oversupply; new uses could boost demand.

Global mine production of cobalt was 98,000 tonnes in 2011, according to the US Geological Survey. With two more mines coming on board in the next few years, London-based CRU has estimated that demand for cobalt will rise to over 100,000 tonnes of refined consumption a year by 2016. The market is expected to remain in oversupply at least until then.

crushing plant parts Indian suppliers The Democratic Republic of the Congo (DRC) sources nearly two-thirds of the world’s cobalt, most of which is refined in China. Zambia, Russia, Australia, Brazil and Canada also produce some cobalt, but the main players are the DRC and China.

The Cambridge researchers, in the meantime, look forward to creating a sunlight-driven hydrogen system.

Fezile Lakadamyali and Masaru Kato, co-authors of the study, told New Energy and Fuel, “[w]e are excited about our results and we are optimistic that we will successfully assemble a sunlight-driven water splitting system soon.” New Energy and Fuel added that it would be a breakthrough if the team “could get the hydrogen ready to store or reconnected to a carbon atom.”