N.B. fracking moratorium raises industry ire, pleases environmentalists
Published Thursday, December 18, 2014 11:29AM AST Last Updated Thursday, December 18, 2014 7:41PM AST
FREDERICTON -- Five conditions must be met before New Brunswick will lift a moratorium on hydraulic fracturing, Premier Brian Gallant said Thursday in a move that has frustrated the energy sector but pleased environmentalists.
The provincial government introduced legislation that would prohibit fracking throughout the province until concerns about health, the environment and First Nations input are addressed.
Gallant placed conditions on the legislation including a process to consult with First Nations, a plan that mitigates the impact on public infrastructure and addresses waste water disposal and credible information about the effects fracking has on health, water and the environment.
The development of a royalty structure and a "social licence" ensuring that the public accepts fracking are also needed before the moratorium would be removed, Gallant said, though he acknowledged that last condition has yet to be defined.
"We have been clear from Day 1 that we will impose a moratorium until risks to the environment, health and water are understood," Gallant told a news conference in Fredericton.
"We believe these conditions to be very reasonable."
He said his government supports job creation but added that it needs to be done in a diversified and sustainable way.
"We're not interested in putting all of our eggs in a single basket," he said.
A number of companies are exploring for shale gas in the province and Corridor Resources recently fracked wells in the Penobsquis area that are used to supply gas to the nearby Potash Corp. mine.
Gallant said such operations would be allowed to continue under the legislation, as long as they don't rely on fracking.
"We'll certainly also always listen to businesses that may have concerns and try to mitigate some of the impacts if they believe (them) to be negative on their operations," he said.
Sheri Somerville, a natural gas adviser with the Canadian Association of Petroleum Producers, said the industry is disappointed with the government's decision.
"We've been saying all along that a moratorium is unwarranted and that we've been doing this safely here in New Brunswick for at least a decade and in other jurisdictions in Canada for more than 60 years," Somerville said.
She said each energy company operating in the province will have to make its own decision on how to react but there are concerns that it could put a halt to exploration.
"This could certainly have a detrimental impact on future investment and industry progress for the province." she said. "It might result in a missed opportunity."
Corridor Resources president Steve Moran said his company doesn't support the moratorium.
"We have always maintained that a moratorium is not necessary for an industry that has operated responsibly and safely in this province," Moran said Thursday in a statement.
He said the conditions cited by the premier are not clear enough.
"They do not provide a predictable path forward. In addition, New Brunswick already has clear and robust regulations in place under which the industry operates safely."
Moran said Corridor Resources and its partners have spent more than $500 million exploring for oil and natural gas in New Brunswick since 1995, drilling 46 wells and completing 120 hydraulic fracture stimulations.
He said the company believes there is a huge gas potential in the province but will only determine that by drilling and fracking more wells.
Jean-Guy Leclair, general manager of PotashCorp New Brunswick, said in a news release if the moratorium removes a supply of natural gas it could raise costs and prompt a review of the firm's operations in the province.
But Stephanie Merrill of the Conservation Council of New Brunswick welcomed the legislation.
"It's really refreshing to see the premier be so concerned about the environment and our water," she said, adding that she hopes the moratorium is permanent.
Mark D'Arcy of the Council of Canadians, who has attended anti-shale gas rallies across the province, said he believes many New Brunswickers support the government's decision.
"This is a great Christmas present," he said.
Opposition Tory Leader Bruce Fitch accused the government of breaking its promising to create jobs by bringing in the moratorium.
Nova Scotia, Quebec and Newfoundland and Labrador have also passed moratoriums on fracking, though they vary in scope.