Econometrix and fracking: why I am not convinced

06 March 2012 - 15:57 By Bruce Gorton
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A Cabot Oil fracking site
A Cabot Oil fracking site
Image: Spencer Platt

Econometrix has released a paper stating that fracking could create upwards of 290 thousand jobs.

This sounds very good – but there is a problem, and it is exemplified by Tony Twine’s guest column on the issue.

Twine writes; “But with that kind of resource, and that kind of revenue, there will be a lot of money available to manage risks.”

What exactly are the risks? That is what is missing from the Econometrix report, it is all best case scenario stuff but precious little on what actually happens if it all goes wrong.

The report reads like PR in that it seems to be all win – while glossing over any risk involved.

Now to some extent this is to be expected, Econometrix wasn’t hired to assess the environmental risk and in real terms they are economists – they aren’t really equipped to.

But how can we have a great economic assessment without including the environmental risk as anything more than a footnote? The Karoo is a major agricultural area, if it all goes wrong we need to know how bad it will be for the rest of the country.

And it could all go wrong, in part because of one of our major flaws as a country.

We have a very poor corporate culture when it comes to the environment. We have factories with “faults” that lead to cyanide being spilt in our rivers. We have crisis such as mine water acidification. Developers are quite likely to try and pump out a wetland before the “greenies” catch wind of their developments.

At the moment we cannot use our local peat deposits in our mushroom farms, because of the uranium in them.

We have a tendency to think of environmental issues on a very surface way, we think animals in the veld instead of the water the nearby village is drinking. We are very good on wanting to protect our rhinos, and very bad on sloppy oversights that may give children cancer.

Fracking may be safe in Poland, what happened there is they recycled the chemicals used to drill through their shale layers – but out here we have cowboys who seem to think they don’t have to worry about our drinking water because they drink Johnny Blue.

We see rand signs and forget that we actually need to live in the environment we are polluting.

And Shell’s recent (as in, June of 2011) slap down by the Advertising Standards Authority does not inspire me with confidence. They sound too confident in their ability to manage any crisis, for me to be entirely sure they have any real plans to.

Now this isn’t to say that we should simply dismiss fracking as an option – the potential benefits are huge – but we need to know the risks, we need to know more about what measures Shell will have in place in case it all goes wrong, and we need to have an independent assessment by geologists, not economists, to find out exactly how bad a risk we would be running.

The report is precisely what PR companies do when faced with real issues in this regard – instead of answering questions on the potential environmental impact they sponsor a report on the potential economic gains from the project.

Economics is all very well and good – but we need to consult with more scientists on this issue. We see what we stand to gain – now what do we stand to lose?

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