German state aims to revive "tight" gas fracking

Thu May 8, 2014 2:21pm GMT

* Lower Saxony houses most gas reserves, wants to exploit them

* Aims to raise acceptance in context of shale gas debate

By Vera Eckert

FRANKFURT, May 8 (Reuters) - Germany's state of Lower Saxony plans to launch a legal move in parliament next month that will seek to end a ban on new exploration for deep-lying gas using the "fracking" technology deployed in the country for over 30 years.

The state, which holds 95 percent of German gas reserves, has lost mining royalties from a two-year long suspension of new permits for hydraulic fracking, which it had quietly been using for decades to get at "tight" gas situated deep underground.

Tight sandstone reservoirs in Germany are typically 3,000 to 5,000 metres deep, while shale formations are between 1,000 and 2,500 metres deep. Opponents say the shallower shale gas deposits open up the potential for contamination of drinking water, which goes down to 1,000 metres.

German shale fracking was initially rejected in an emotional debate, which in the process blocked new tight gas projects because the authorities did not want to be associated with the unpopular process.

Fracking involves the pumping of water and chemicals at high pressure through drill holes to prop open rocks.

Lower Saxony's economics minister, Olaf Lies, said in a statement on Thursday he will present a draft law to the Bundesrat, made up of the governments of the 16 states, in mid-June, that will make environmental audits mandatory in order to free up the process.

"I am confident that we can create a new legal framework by the autumn," Lies said, making clear his initiative was not an attempt to open the way to fracking for shale gas.

FRACK FRICTION

Countries across the globe are considering copying U.S.-style shale gas fracking, which has fanned an economic boom, but opposition is strong in densely-populated Europe, where environmentalists warn against the proximity to drinking water.

Opposition to shale fracking is strong in Germany, which is also committed to a renewable energy drive. But the Ukraine crisis has highlighted the country's dependency on gas imports from Russia, given falling domestic gas output.

Lies said that clear environmental guidelines would raise acceptance and allow Lower Saxony producers, which include Wintershall and ExxonMobil, to get back to normal operations in the conventional gas sector.

Fracking of shale gas was expressly not intended, he said. ($1 = 0.7183 Euros) (Editing by Keiron Henderson)