- Houston Chronicle article by Loren Steffy

 

I frequently speak to energy industry groups, and one of the most common questions I get is: What can the industry do to improve its public image?

There's no simple answer, but a big step would be greater transparency on environmental issues, especially those that directly affect people's quality of life.

Gov. Rick Perry recently signed the first state law that requires drilling companies to disclose the chemicals they combine with water and sand to fracture shale rock deep in the earth and extract oil and natural gas.

Other states regulate the hydraulic fracturing, or fracking, process, but Texas is now the only state with a law that, beginning next year, requires companies to publicly post the chemicals and the amounts used in drilling wells.

The Texas law was passed with the support of many companies that use the process, and the industry clearly hopes it will allay growing public concern about what is being injected into the earth and whether it could affect drinking water.

At Chesapeake Energy's annual meeting earlier this month, CEO Aubrey McClendon, a longtime proponent, told investors, "We have seen the light."

That raises another question: What took McClendon and others so long?

The industry clearly believes much of the concern about fracturing is overblown, fueled by a lack of public understanding of the process. It may be right, but that misses the point.

Fears grew and grew

While the industry tried to brush aside public concern, misunderstanding mounted. A documentary that offers little more than circumstantial cause-and-effect footage of a flaming faucet was nominated for an Academy Award. Public fears about fracking have reached a fever pitch akin to the Roswell Incident.

While environmental groups cautiously praised the new law, they were quick to note that it doesn't go far enough. Translation: This ain't over.

Oil companies have become such convenient villains, especially for environmental groups, because they are so willing to play the role.

By refusing for years to say what they were injecting into the ground, energy companies only fueled the fears of a public that was already uneasy about wells encroaching on suburban neighborhoods.

Only sand and water

At first, companies insisted that only sand and water were used in the process. Only later, after reports surfaced that other chemicals were included in the drilling fluids, did the industry admit they were. The industry insisted the chemicals weren't harmful. Then, it turned out some, especially those used in the past, were. And even after all that, they refused to reveal exactly what chemicals were still being used.

As the controversy grew, the industry's knee-jerk response was to close ranks. Almost two years ago, I spoke with a frustrated PR guy in the Dallas area who was advising companies drilling in the Barnett Shale near Fort Worth to tell concerned homeowners what was being injected into nearby wells.

He couldn't get his clients to understand that the more they resisted, the more they fed public distrust over the entire drilling process.

Secrecy in the extreme

Companies claimed that the ingredients were some sort of secret recipe, and revealing the contents would hurt their business.

The most closely guarded corporate secret on Earth is the formula for Coca-Cola. Yet every can lists the contents.

This was a problem the industry could have fixed quickly. Yet, when controversy arose, it headed for the bunker. It once again failed to understand the cost of losing credibility with the public. Secure in its own science, it simply dismissed the concerns, ignoring the rising outcry until far too late.

Now, it sees the light, but by now, that light isn't bright enough to silence the controversy.

Loren Steffy is the Chronicle's business columnist. His commentary appears Sundays, Wednesdays and Fridays. Contact him at loren.steffy@chron.com. His blog is at http://blogs.chron.com/lorensteffy.

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This liberal rag has done it again.  The last ingredient is "natural flavorings"--how is this different than "other chemicals"?   For the only paper in arguably the capital of the domestic oil industry, the "Comical" sure doesn't have a lot of good to say about our business.
I thought the author hit the nail on the head.  The arrogance of the industry blinds them to the requirement that they exercise some professional public relations so that they stay out of controversies such as the ongoing frac debate or at least have the majority of the public properly informed and sympathetic to their side of the issue when it goes political.  The industry often makes their job tougher than it need be.  The begrudging and tardy realization, and admission, that PR is important is only of value if it is a lesson learned and heeded in the future.  There will be many more battles to come between the pros and the antis.

Your question lends creedence to the author's point about industry insider versus public perception of the fracking fluids issue, leaving the "misunderstood" to reply with "Fundamentally, there is no difference. But which would you rather drink?" If the answer is either, then perhaps the industry should simply consider listing "natural flavorings" in lieu of "other chemicals."

Clever.  Personally, I wouldn't mind drinking frac water, as I probably had more guar in my lunch today than I would get in a glass of slickwater.  But you miss the point.  Steffy's piece was guilty of the same misleading untruths as the NYT arcticle on shale gas ponzi schemes, which coincidentally ran in section A the same day.  If you want to be a shill for the Chronicle and the Times, that's your perogative, I for one can't wait for them both to go under.
You miss the point.  There is no fundamental connection between this article and the NYT hatchet job other than the fact that the industry has chosen to ignore rising criticism and junk science allowing it a chance to influence the average American consumer.  The industry gets a D- in public relations.  Now they have to play catch up and I think the uproar created by the NYT article is as good a place as any to start.  The responses published so far have been quite good.

Looks like another article filled with half facts.  The industry has never stated that frac fluids were only sand and water.  The author also misses the fact that the resistance to disclosing contents was primarily by the service companies rather than the "energy" companies.

 

The bottom line is that the majority of the public will never trust "Big Oil" or any other energy company.  To most they only believe what the politicians, media and environmentalists feed them even when full of half-truths and slanted information.  I cite Gasland and the NYT story as prime examples.  Having been around the industry for a very long time and have seen a lot of futile effort made by different companies to get their message out on various topics - but to no avail.  

I loved this article. It was short, sweet, and to the point.

I would love to see the oil and gas industry pull thier head out of the sand and address public concerns respectfully, accurately, and robustly.

If some little group of people can get together and produce a "documentary" about how the evil oil companies are polluting the drinking water, and get it on national TV. I'm pretty sure the oil and gas industry can afford to put together a documentary about the history, value, and important contributions of the industry, while addressing the real environmental issues.

It hasn't been done for a variety of reasons. The main reason is that they don't see it as being all that big of  a deal. After all, they still get plenty of leases, right? Ms. Steffy got it right.

"It sees the llight, but by now, that light isn't bright enough to silence the controversy."

"While environmental groups cautiously praised the new law, they were quick to note that it doesn't go far enough. Translation: This ain't over."

 

This statement was very telling.  With some of the environmental groups - it will never be enough.  A large percentage are anti-fossil fuel and see shale gas as undercutting their all renewables agenda.  Their objective would be for power costs to jump significantly therefore justifying the high cost of solar and wind power.  These groups are well funded and file lawsuits against anyone, including government agencies, if necessary to advance their cause.  I have experienced their actions firsthand.

 

Unfortunately people assume information printed by the media must be true and factual.  It should be that way but the media doesn't want the facts to spoil a good story.  It some cases they just retread statements made by questionable sources with their own agenda.

 

I say the energy industry is in a no win situation with the public - no matter how they respond or don't respond. 

This is a great article. I just wish it had been written by an industry person. Skip is right that the industry only gets a D grade for its public relations.  One image, the flaming tap water has defined this debate but the industry has done a lousy job of responding even to it.

 

Did anyone read ALL of Aubrey's response to the NYT article (and follow the links?)  I thought it was brillant - but it was also clear it had not been vetted by a PR professional.  It could have been more powerful if it was shorter and did not attack the NYT.  Like Mad Money man Crammer told him "that's not the way to play it". 

 

Aubrey does very well in most interviews, but he seems to lack a pr professional on his staff or at least he needs to listen to his pr people more.  He wants to be the man books are written about in the future and he can be.  Aubrey has vision but his pr skills need real polishing. He's got to learn how to speak to people outside of the industry.  He's recently been one of the leaders for fracking disclosure, but I don't think that's been clearly communicated at all.

 

 

Shell Launches Safe Shale Blueprint for Industry - fuelfix.com article, June 29, 2011.

 

Shell Oil is trying to take the lead in onshore shale gas and oil development with the unveiling of a set of five “Global Onshore Tight/Shale Oil and Gas Operating Principles.”

Operating principles are a framework for how Shell says it and other companies should protect water, air, biodiversity and the communities where they drill for and produce natural gas and oil.

The principles include safe well design and completion standards, water protection and reuse goals, air quality and emissions prevention measures, limits on the physical footprint of operations, and community engagement.

The move is being made in response to a growing backlash against natural gas drilling, which some regulators, residents and environmental activist say has been linked to a growing number of ground and surface water contamination incidents.

“We understand there is concern around the development of shale gas, and we must give the public more knowledge of how we operate,” said Marvin Odum, president of  Shell Oil. “People have asked the industry for transparency; we have listened and are responding.”

Shell’s five onshore tight and shale gas operating principles include:

1) Safe well design – use of two or more barrier layers between the well’s interior and rock walls, as well as steel casing and cement to protect and isolate potable groundwater zone from oil and gas production stream; public disclosure of chemicals used in hyrdraulic fracturing process; routine well safety reviews; and emergency response plans.

2) Protection of groundwater and reduction of water in process– potable groundwater aquifers isolated from well completion and production activities; groundwater supplies tested for safety before and after operations; non-potable water used in hydraulic fracturing and wastewater reccyled whenever possible.

3) Emissions reduction — work toward testing sites for “fugitive” emissions from drilling and hydraulic fracturing operations, eliminate routine venting where allowed, employ less-polluting equipment and make greater use of clean fuels like natural gas in engines.

4) Surface impact –work to reduce “footprint” of drilling and completion operations, minimize impact on local livestock and wildlife, partly by limiting activities during certain time periods; install oil and gas gathering systems and pipelines to reduce trucking; return land to original state once operations concluded.

5) Commmunity engagement — improve transparency of operations, share local socio-economic reports, hire locally and identify opportunities for local investment and partnerships.

Shell Onshore Drilling Principles

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