Unconventional gas and hydraulic fracturing

Natural gas plays an increasingly important role in supplying lower-carbon fuel to meet the world’s growing energy needs

Natural gas has the lowest greenhouse gas (GHG) emissions of any fossil fuel when burnt. With the technologies needed to produce and use this resource widely available today, we expect that natural gas is likely to meet around 26% of total global energy demand by 2035. Shale gas is expected to contribute almost half of the growth in global natural gas supplies between 2014 and 2035.

BP is working to responsibly develop and produce natural gas from unconventional resources including shale gas, tight gas and coalbed methane. Approximately 80% of BP’s onshore natural gas production is from unconventional resources. We have operations in Oman and the US and we are evaluating unconventional gas opportunities in other countries. Our US Lower 48 business spans 5.7m acres with active operations in six states.

Q: What governance process and standards apply for your Lower 48 business?

A: Our US Lower 48 onshore business operates in a highly competitive, regulated and rapidly changing environment and we realized we needed an operating model that could successfully respond and compete accordingly. Though still wholly owned by BP, we began operating as a separate business in 2015 with our own governance, processes and systems. 

In practice, this means that we apply BP’s group operating management system in a way that is appropriate to this dynamic environment. For example, we undertake monthly safety and operational performance reviews, which allows us to drive changes in real-time. And, like all of BP, safety is our number one priority and measure of success.

David Lawler, chief executive officer, US Lower 48 onshore, BP

We work to reduce and manage the impacts of our operations, including water, chemicals, GHGs and seismic activity.

Water

BP wells and facilities are designed, constructed, operated and decommissioned to mitigate the risk of natural gas and hydraulic fracturing fluids entering underground aquifers, including drinking water sources. We test the integrity of our wells before commencing fracturing and again when work at the well reaches completion.

We also work to reduce the use of freshwater in our operations. We are trialling a number of water-saving innovations, including new technologies that could make it possible for us to treat water used in fracturing for reuse in our operations. At our Khazzan operation in the remote Omani desert, we treat the wastewater from our sewage treatment plant and reuse it for irrigation, landscaping, road construction and dust suppression. Plans are in place for 2016 to allow us to make multiple uses of water used in pressure testing.

Chemicals

Water and sand constitute on average 99.5% of the injection material used in hydraulic fracturing. Some of the chemicals added to this water–sand mix, when used in certain concentrations, are classified as hazardous by the relevant regulatory authorities. BP works with service providers to minimize their use where possible. We list the chemicals we use in the fracturing process in material safety data sheets at each site. We also submit data on chemicals used at our hydraulically fractured wells in the US, to the extent allowed by our suppliers who own the chemical formulas, at fracfocus.org or other state-designated websites.

Greenhouse gas emissions

We are working to minimize air pollutant and GHG emissions, such as methane, at our operating sites. For example, we use a process called green completions at our gas operations in the US. This process captures natural gas that would otherwise be flared or vented during the completion and commissioning of wells. We are also using micro-turbines - low-emission generators - and solar energy to power our on-site operations.

Our Khazzan gas project in Oman has been specifically designed to be an inherently low emission concept. For example, we have built a central processing facility that takes away the need for processing equipment at each individual well site, which can be a source of additional methane emissions in gas production.

We have estimated and managed methane and hydrocarbon emissions from our US onshore natural gas operations for more than a decade.

Seismic activity

Hydraulic fracturing creates very small earth tremors that are rarely felt at the surface. The underground injection of wastewater, such as for the disposal of water produced from oil and gas reservoirs, may also pose a risk of inducing seismic activity in some areas, but very few events have been documented relative to the large number of disposal wells in operation. Before conducting work, BP assesses the potential risks of induced seismicity resulting from our operations, and we design our operations to mitigate this risk. We apply best practices, reviewing and updating our approaches to reflect lessons learned across the industry.

Engaging with communities

The development of unconventional resources has moved energy companies into new and often more densely populated areas. We seek to mitigate potential impacts on local communities and address concerns that may be raised during operations such as increased traffic, noise, dust, air pollution, visual impacts, disruption of wildlife, and increased pressures on the local infrastructure.

For example, we work with the Durango Citizen Advisory Panel, in La Plata County in Colorado, which meets regularly to discuss issues of interest to the local community and BP.

Attestation

The information on this page forms part of the information reviewed and reported on by Ernst & Young as part of BP's 2015 sustainability reporting. View the full assurance statement.

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