Germany Imposes Limits on Fracking

Reuters

BERLIN/FRANKFURT, June 24 (Reuters) - Germany imposed limits on fracking on Friday, dealing a blow to efforts to develop shale gas.

Under legislation passed by its lower house of parliament, fracking will be banned in clay formations, which typically lie between 1,000 and 2,500 metres deep.

Scientific test drilling will be allowed but only with the permission of the relevant state government and under the watch of independent experts.

Fracking for deep-lying or "tight" gas typically 4,000 to 5,000 metres deep, which has been done for more than 30 years in Germany, will continue but under more stringent regulation.

In tightening its rules on fracking Germany follows France, which has banned the practice, and the Netherlands, which last year introduced a moratorium on shale exploration until 2020.

The German ban is indefinite but parliament will reassess it in 2021 under a compromise reached between the conservative Christian Democrats (CDU) and the left wing Social Democrats (SPD).

Fracking involves blasting chemicals and water into rock formations to release trapped gas. Opponents cite the risk of triggering earthquakes and contaminating drinking water.

Germany's gas industry has warned restricting fracking could increase the country's dependence on imported energy, much of which it imports from Russia.

"Shale gas is an important option, where we have practically given away our chances with this legislative package," said Christoph Loewer, managing director of German oil and gas association BVEG in Hanover.

Germany could extract between 320 billion and 2.03 trillion cubic metres of gas from depths below 1,000 metres in northern Germany, according to the Federal Institute for Geosciences (BGR).

That dwarfs the 110 billion cubic metres of conventionally available gas still left, according to estimates by BGR.

Germany last year extracted 9 percent of its domestic gas demand.

Companies involved include BEB Erdgas and Erdoel, Mobil Erdgas-Erdoel, GDF Suez E&P Deutschland, Wintershall and Dea.

(Reporting by Caroline Copley and Vera Eckert)

Copyright 2016 Thomson Reuters. Click for Restrictions.

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