Federal agencies and the natural gas industry should provide communities newly affected by shale drilling activity with the kind of research needed to better understand those affects, according to Christopher Smith, the Department of Energy's deputy assistant secretary for oil and natural gas.
"You see this rolling wave of moratorium action that's happening at the state level, and you see this very complex, interwoven set of regulations that we use here in our country to regulate natural gas -- we don't have a national framework, we've got a state-by-state approach, largely -- and you realize that although the technical challenges are things we understand a lot about, it's that concern around the environmental impact of natural gas and the safety impact of hydraulic fracturing that communities have that's going to be a very important step in ensuring that we develop this resource to its fullest potential," Smith told the Natural Gas Roundtable in Washington, DC, Tuesday.
That makes it important for regulators and the industry to conduct the right research to bring scientific rigor to the discussion, he said. "I think we can collectively raise that to make sure that we're talking about the right things and we're collectively making the right decisions."
Many of communities experiencing a boom in shale-related exploration and production (E&P) activity "haven't seen E&P for generations.," Smith said. "Shale gas kind of started and moved quickly in the Barnett Shale, where you've got a history of exploration and production activity, but as you move to the East Coast and further up north, you're moving into communities that don't know how to do this. They don't have this experience...
"You're seeing the future tax base, you're seeing a lot of positive things -- you're seeing new jobs, you're seeing economic prosperity -- and all of these things are things the communities want...[but] before you get that first incremental tax dollar, you've got development to deal with, you've got permits to deal with, you've got people who have concerns...many communities don't know how to deal with that boom and bust cycle...
"How do we ensure that communities are ready for this freight train that's about to hit them? It could be a very good thing; it should be a very good thing. It should be about economic development and prosperity to come, and will be if we manage it correctly, but there's a path that these communities have to go through."
Within the Obama administration, "there's an acknowledgment, there's a realization, that gas is important, and that we need to be doing some things...to do everything we can to make sure that we do develop these resources in ways that are prudent and expeditious."
Smith, who is responsible for administering domestic and international oil and gas programs, was appointed in October 2009. He previously worked for Chevron and Texaco, focused primarily on upstream business development and LNG trading, including three years negotiating production and transportation agreements in Bogota, Colombia.