Colorado oil & gas working to become more transparent
Former Shell president warns that the industry must talk to the public or face more regulationBy Martha Young
Colorado's oil and gas industry is taking major strides to become more transparent to the public. Mission Possible, the theme of the Colorado Oil and Gas Association's (COGA) 23rd annual Energy Epicenter Conference, reflected its awareness of the need to improve communications and get in front of issues before they become emotional flashpoints.
In a keynote address entitled Cutting through the Contradiction, former Shell Oil President John Hofmeister lambasted the industry for talking to itself and its associations.
“The burden is on the industry to answer the who, what, whys," he told the conference. "In a democracy, if the public is fearful, then the government is forced to regulate.”
Other issues discussed at the conference included the following:
Groundwater safety is a major concern for communities near drilling pads. Once the water is contaminated it is extremely difficult to clean. The O&G industry has repeatedly been charged with contaminating ground water. However, groundwater contamination can occur naturally as the rocks decompose releasing a variety of gases including methane and radon.
At the conference, COGA announced a voluntary groundwater sampling program. The program is in partner with the Colorado Department of Natural Resources and Gov. John Hickenlooper. The voluntary program has been embraced by over 90 percent of the oil and gas companies doing business in Colorado. The data will be compiled in a database and made publically available at the Colorado Oil and Gas Conservation Commission website. More details on the program can be found here.
Hydraulic fracturing fluids
Hydraulic fracturing has only recently become a flashpoint topic. The oil and gas industry has been doing well fracturing since the 1940s. The bulk of the fluids, over 90 percent, used in fracturing are water and mud. It is the remaining 10 percent of undefined chemicals that concern citizens. There is a public outcry for disclosure of the chemicals being used. This is not an unreasonable request, except that companies within the industry consider this information a trade secret that provides a firm one of its sustainable competitive advantages.
Two exciting solutions were presented at the COGA conference. First is the endorsement of the website FracFocus.org. The website is a joint project of the Ground Water Protection Council and the Interstate Oil and Gas Compact Commission. The site provides fact-based information on the chemicals used by site, as well as clarifying information that explain the fracturing process.
The second solution was presented by Halliburton during the luncheon keynote. The firm demonstrated the safety of its newest fracking fluid, CleanStim, by drinking it! The new formula is made of food-grade products.
Panel after panel noted the need for a national energy policy. This topic comes up at every energy conference. The only way we will get an energy policy is by demanding our representatives take action.
Without an energy policy that focuses on developing our own resources, from wind and solar to oil and gas, the country will continue to be in the clutches of OPEC. There is a direct correlation between GDP and energy consumption. If our legislators really want to get the country back onto an economic growth trajectory, then they must make developing an energy policy a top priority.
First and foremost, energy availability and reliability is a national security issue. As was noted at the COGA conference, and across numerous other conferences, the United States is funding both sides of the Iraq and Afghan wars. The money sent abroad for a barrel of oil gets transferred to our enemies. The impact of importing oil is extremely detrimental to the security of the country.
The international political situation is extremely complex, but at the end of the day Washington has an obligation to take care of its own constituents first. Energy issues are spun a dozen different ways including as a climate issue, healthcare issue, or environmental issue; but the only one that really impacts every single person in the country is the national security issue.
About Martha Young
Martha Young is principal at NovaAmber, LLC, a business strategy company based in Golden. Young has held positions as industry analyst, director of market research, competitive intelligence analyst, and sales associate. She has written books, articles, and papers regarding the intersection of technology and business for over 15 years. She has co-authored four books on the topics of virtual business processes, virtual business implementations, and project management for IT. Young can be reached at email@example.com or on Twitter @myoung_vbiz