Worry over fracking - but no moratorium
The Parliamentary Commissioner for the Environment (PCE) has held back from calling for a moratorium on fracking, but is worried about the way the process is regulated and monitored.
"There have been calls for a moratorium to be placed on fracking in New Zealand, but I do not think this is justified at present," commissioner Dr Jan Wright said in an interim report published today.
Fracking - short for hydraulic fracturing - involves injecting fluid containing sand and chemicals at high pressure to fracture rock, in order to extract previously inaccessible oil and gas.
In her report, Wright referred to work by the British Royal Society which found the environmental risks associated with fracking could be managed effectively, provided operational best practices were implemented and enforced through regulation.
"But at this stage I cannot be confident that operational best practices are actually being implemented and enforced in this country," Wright said in her report.
One issue was that companies were perhaps being trusted rather too much to all do the right thing.
The second stage of her investigation would look at how well the environmental risks associated with fracking were being regulated and monitored.
While discussing the interim report, Wright warned that if she found issues that were sufficiently worrying she would not hesitate to call for a moratorium.
The report raised concerns about whether New Zealand would be able to cope with a surge in fracking activity.
"If, for instance, exploration drilling on the east coast of the North Island reveals the presence of commercial quantities of oil that can be recovered through fracking, an 'oil rush' would likely follow - many exploration wells could be drilled in a very short time with production not far behind."
Such rapid scaling up had led to well-publicised problems in other countries.
"The scale and speed of change that could occur requires forethought now. We need to prepare for a future that might take us by surprise," Wright said in the report overview.
The potential for important aquifers to be contaminated as a result of fracking was "very real".
While there was much concern about the chemicals in fracking fluid, the salty water that came from deep under the ground along with the oil and gas was much greater in volume, and could also contaminate groundwater.
Internationally, there were many anecdotal examples of aquifer contamination after nearby wells had been fracked.
Spills and leaks were one way fracking could lead to water contamination, but were relatively easy to manage.
Another way was through migration, where oil and gas or other fluids travelled up through cracks in the rock and eventually reached aquifers.
The possibility of contaminants migrating into aquifers through cracks created during the fracking process was only a remote possibility because the cracks were unlikely to be long enough to create pathways in the rock between the fracking zone and aquifers, the report said.
It was possible cracks produced by fracking could connect to natural fractures or faults in the ground, and create a pathway, the report said.
But it also said: "While possible, the probability of fracking fluids migrating to freshwater aquifers or the surface is very unlikely."
The third possible way fracking could lead to water contamination was through well failure.
"To date, there is no evidence that fracking has caused groundwater contamination in New Zealand, and at the current scale of operations, the risk appears low," the report said.
Another major concern was the potential for triggering earthquakes. The process of fracking itself caused only "very tiny" earthquakes.
"But if liquids (fracking fluid or wastewater) were to find their way into an already stressed fault, the fault might slip triggering a more significant (though probably small) earthquake," the report said.
There were three documented overseas cases where fracking fluid injection had reached nearby active faults and caused earthquakes. Those earthquakes were all less than magnitude 4 and caused no surface damage or water contamination from well damage.
The first known use of fracking in this country was in 1989, with almost all the fracking in New Zealand taking place in Taranaki.
GREENS CALL FOR 'SAFETY-FIRST' APPROACH
Despite the commissioner deciding not to call for a moratorium, the Green Party believed her report pointed to the need for such a step.
"The PCE’s report does not say that fracking in New Zealand is safe, the report concludes that fracking companies do not have a 'social licence' to operate and that the regulation is fragmented and light-handed," Green Party energy spokesperson Gareth Hughes said.
He urged the Government and councils to take a safety-first approach and put a halt on fracking until strong regulations were in place.
"Given that the oil and gas isn’t going anywhere, why allow fracking to continue in the absence of a guarantee that world best practice is being implemented in New Zealand?"
Canterbury University senior lecturer in environmental chemistry Dr Sally Gaw said even with operational best practices, blow-outs, mechanical failure and human error had the potential to contaminate soil, surface waters and groundwater.
"The consequences of a contamination incident have been understated in the report as there are limited to no options for remediating groundwater and soil once contamination has occurred."
Canterbury University lecturer in rock mechanics Dr Marlene Villeneuve said close collaboration was needed between the Government, industry and research organisations to understand the response of reservoir rocks to fracking for each geological area where oil and gas extraction would be undertaken. That understanding was needed for regulators and companies to be able to develop best practices.
Dr Julie Rowland, from Auckland University's school of environment, said there was a need for high quality research to inform best practice in relation to well location, design and construction, and the storage and disposal of waste.