US Lobbies for Shale Gas in Romania and Bulgaria
In late May, officials from Romania and Bulgaria received visits from United States Ambassador Richard Morningstar, Special Envoy of the Secretary of State for Energy in Eurasia.
Both the meeting with Romanian President Traian Basescu as well as with officials in Sofia, saw shale gas as the main topic of discussion, with Ambassador Morningstar pressing for a good public discussion of weighing the risks and benefits of hydraulic fracturing technology.
Following the meeting in Bucharest, President Basescu said that if Romania was to be competitive and secure in the energy market, it needed to develop a strategy to explain to civil society that the exploitation of shale gas does not pose serious environmental, health or other economic challenges.
"In any case, about the energy, we must recognize that in Romania we have a debate on shale gas and must develop a strategy to explain to people that there are serious risks with this gas," said Basescu, known for his favorable position towards the development of shale gas, as quoted by Mediafax.
The meeting with Ambassador Morningstar at Cotroceni Palace was also attended by U.S. Ambassador to Romania, Mark Gitenstein and presidential adviser Cristian Diaconescu.
Ambassador Gitenstein later said he would discuss the moratorium on shale gas exploitation with Minister of Economy Daniel Chitoiu, wanting to know how the Romanian Government intented to proceed.
"The new government wants to wait a little longer before deciding whether those wells will be operated. My recommendation would be to find even if shale gas exist in Romania (...) It seems not unreasonable for the government, now has returned to power after eight years, want to understand what technology will be used to determine what strategy to follow (...). I can understand that the transition from exploration to exploitation, drilling, hydraulic fractionation and extraction of unconventional gas (shale gas ) situation will be different, "said Gitenstein, for the national television news channel.
Also, Gitenstein commented that should the moratorium period be of an unreasonable length, the terms of the Romanian government license with Chevron could not be implemented. He noted that Chevron's task was to explain the Romanian public that shale gas exploration and exploitation is environmentally friendly.
"If you decide that there is shale gas and you want to use it, you have to have a clear plan that assures people that the environment is not affected. As we did in the U.S., where there was a panel in Department of Energy, the so-called Deutch's commission, which has developed a whole plan for exploitation of shale gas. I think it would be wise as Romanian government to analyze that the plan. If this is the reason for moratorium, I think it would be a good idea (...) I will present (documents) to Minister of Economy, " said Gitenstein.
Prime Minister Ponta's Cabinet is to establish a moratorium on the exploitation of shale gas until clarification is received from environmental impact studies that are ongoing at the European level. In the interim, the Government proposes: "the immediate establishment of a moratorium on shale gas operation until the studies that are ongoing at European level on the environmental impacts of hydraulic fractionation process."
During his visit to Sofia, where lawmakers have banned the exploitation of gas and oil through hydraulic fracturing, te U.S. envoy met with President Rosen Plevneliev, Prime Minister Boyko Borisov and other senior officials. Discussions were closed to the media.
Following Morningstar 's meetings with officials, the Ambassador presented the advantages of shale gas exploitation in a broadcast on Bulgarian national radio.
Morningstar explained that due to development of shale gas resources, American consumers paid only 20% of the price charged to Bulgarians for 1,000 cubic meters of natural gas.
Morningstar also acknowledged environmental challenges associated with shale gas extraction.
'Yes, there were environmental problems. And these problems have been treated with great care in the United States. Our Department of Energy has made a comprehensive evaluation and final report of the Environmental Protection Agency to be published next year. We believe that technology is sufficiently advanced that risks are limited. Of course, we will see what will be mentioned in the final report. Do not neglect all environmental risks. It is a matter of management technology to limit risks to acceptable levels, "said Morningstar, who re-iterated that a proper examination would show that the potential rewards to be reaped from shale gas development outweigh the risks (which need to be effectively managed, none-the-less).
Another common topic of discussion between Morningstar and Romanian and Bulgarian officials was that of building the Nabucco gas pipeline project.
In an interview to the Romanian business newspaper Capital, the American envoy commented that the pipeline was beneficial, economically, politically and strategically, but must be cost-effective and economical.
In Morningstar's opinion, it was likely that Nabucco would starts as a smaller project to be extended once new gas discoveries in Azerbaijan were established.
"The pipeline already has a starting point, Shah Deniz in Azerbaijan, but most likely will be smaller, will be expanded later," said Morningstar.
By Silviu Molnar
Related Reading: No Shale Gas Exploration in Romania in 2012