Todd Energy's mandatory flare pit at its Mangahewa C
drilling site. Photo by Simon Hartley.
Fracking for oil and gas around Otago and Southland is
probably many years away, but the Taranaki Regional Council
(TRC) has been dealing with the contentious issue for decades.
The annual $2 billion oil and gas industry in Taranaki hosts
62% of New Zealand's 638 wells - 470 onshore and 168 offshore
- boosting to thousands the number of jobs in the region.
With TRC leading the way in the consenting process, providing
a working model which other councils could consider adopting,
environmentalists and anyone concerned about aquifer
contamination could be in for a shock.
The TRC issues resource consents for oil companies to drill
test wells, production wells, to use hydraulic fracturing
methods and also monitoring of oil (condensate) and gas
production sites on land.
TRC charges $50,000-$60,000 for site monitoring, which could
include fracking, $8000 for monitoring a three-month test
well and $20,000 annually to monitor the established
So far, there have been 43 wells subject to 69 incidences of
hydraulic fracturing, or fracking, in Taranaki, which only
since 2011 have required resource consents from the TRC.
There have been 20 resource consents for hydraulic fracturing
issued since 2011, but none was publicly notified, TRC
director of resource management Fred McLay said.
''The key to hydraulic fracturing is well integrity. Getting
the drilling, casing [pipes] and cementing right is what
matters most,'' he said.
Consents were required from 2011, as legal opinion to the TRC
was that hydraulic fracturing was considered a ''discharge to
land'', albeit at great depths, so should be consented.
The fracking process is contentious for several reasons: the
vertical drilling and pipe crosses horizontal water aquifers;
toxic chemicals are in the mix of fracking fluid; and there
is treatment of waste fracking fluids which return to the
surface, with the potential for spills above ground.
Critics point out the intense toxicity of some chemicals
which make up the 2% of the mainly mud and water fracking
fluid. Fluid users counter the chemicals are hugely diluted
and are in fact akin to household chemical products, which
ultimately go down the drain.
Aquifers crossed through at a depth of 300m-500m, while
vertical drilling goes beyond to depths of 1000m, plus up to
a further 2km-3km of horizontal drilling.
In considering resource consent applications for hydraulic
fracturing, Mr McLay said ''key'' to whether the application
would be notified publicly or not was if ''affected parties''
were deemed actually directly affected.
The Otago Regional Council has no fracking applications
before it, and maintains it will take guidance from the
Resource Management Act, which first considers ''affected
parties'' and environmental effects.
In Taranaki, because all 20 consents for hydraulic fracturing
were for wells deeper than 3km, Mr McLay said they were not
''Because the hydraulic fracturing was about 3.5km
underground, the effects are less than minor, because of the
depth,'' he said.
However, he was aware environmentalists, and members of the
public had ongoing concerns about potential aquifer
contamination; people who would be deemed ''interested
His response was that those critics go online and read all
the publicly available TRC monitoring reports, and also
Parliamentary Commissioner for the Environment Jan Wright's
interim report on fracking in New Zealand, released last
''We want transparency and all monitoring is made publicly
available,'' Mr McLay said.
He defended the decision on non-notification to the public,
saying there was widespread consultation by the TRC with the
community and iwi. In 2011-12, there were 234 non-notified
consents across all activities dealt with by the TRC, with
577 community consultations and 117 consultations with
''The oil and gas sector is not a special case. We apply the
same consents and monitoring to dairying, poultry or pigs,''
Mr McLay said when interviewed.
Petroleum Exploration and Production Association of New
Zealand chief executive David Robinson, accepts climate
change is a legitimate, scientific issue.
However, he believes the peak oil theory now takes a back
seat while fracking releases more oil and gas, thus
replenishing global energy stocks, and gives more time for
renewable energy sources to be developed.
Todd Energy operates the Mangahewa C production facility near
Stratford in Taranaki, a ''pad'' where the largest onshore
rig in New Zealand is drilling four holes (which eventually
turn from vertical drilling to horizontal) up to 5km in
Spokesmen on-site said ''most'' of the wells would be
considered for fracking in the future, given that the
condensate and gas was trapped in less porous rock, at depth.
Capturing oil and gas by fracking is referred to as an
''unconventional'' method, as opposed to solely drilling, and
letting underground pressure, or introduced displacement
fluids, force out the product.
''Unconventional is going to become the conventional method
in the future,'' Mr Robinson said.
Once the horizontal pipe is perforated, leaving a 200mm-long
hole into the surrounding rock, fracking fluid is pumped into
the pipe at about 8000 pounds per square inch, which
fractures the rock for 50m-60m beyond the pipe, which
releases the gas and condensate.
Mr Robinson said the present ''gas rush'' in the United
States, spurred by fracking, had returned the country's
carbon emissions to 1990 levels, by replacing coal-based
He noted a nearby gas-fired ''peaker station'' for
electricity was the ''perfect complement'' to renewable
energy sources, as it can be turned on and off almost
instantly to boost energy levels, should wind or hydro
production be low.
Nearby, Tag Oil operates the 12-well Cheal condensate and gas
plant, which splits out the two products from water, which is
screened and then heated and returned down the pipe to
increase pressure. About $100 million has been spent on the
plant, including $40 million in a recent upgrade for new
production, of which about $35 million was spent in the
The plant's output, which will accommodate eight new wells
nearby on a second pad, equals about 2000 barrels of oil per
day, in gas and condensate; a high grade oil type which is
exported for refining and is a higher quality than the
imports to Marsden Point for refining.
Oil companies and environmentalists have fought themselves
almost to a standstill, each claiming irrefutable evidence on
whether or not fracking contaminates aquifers or causes
Regardless of what assurances, statistics, data, oversight or
monitoring arrangements are put forward for fracking, a
growing number of environmentalists will simply be saying
''No'' on the basis risk outweighs any benefits.
Forest and Bird have challenged the courts to accept that
climate change issues should be included in West Coast coal
mining resource consent applications, with a decision yet to
be released. Fracking in the South appears years away, if at
all, with no companies actively exploring for oil and gas
The question arises whether the public or environmentalists
in the South would accept the TRC's model of no public
notification because the work is 3km underground, and
therefore has no affected party.
Reporter Simon Hartley was hosted to Taranaki by
Pepanz, whose members include Todd Energy and Tap