It will be interesting to see how the environmentally sensitive French react to the widespread use of the controversial hydraulic drilling technology known as “fracking on their home turf. Toreador Resources, a Texas oil company, has been awarded drilling rights to 750,000 acres of the Paris Basin, its licenses stretching for hundreds of kilometers from St Dizier, on the edge of the Champagne region, to Montargis, just south of the royal palace of Fontainebleau according to an article in The Australian. Craig Mackenzie, chief executive of the Dallas based Toreador Resources is reported as saying the company wants to start drilling three pilot wells early in 2010, at a cost of US$30million, and to be producing oil from them by the end of the year. But the oil is not the free-flowing crude kind that can be pumped up from below-ground using oil derricks or nodding donkeys. Instead, it lies trapped within a type of organic-rich, porous sedimentary rock from which it can only be extracted by fracturing the rock with high pressure water and a mix of chemicals. We have written about this process before with regard to the massive reserves of natural gas the process has opened up in the US but at the same time has caused anxiety that water resources could become polluted and mini earth quakes rumored to be associated with the process could damage surface facilities. Last week, officials in New York City urged state politicians to ban hydraulic fracturing in its watershed, saying that the process used to extract the gas threatened the city’s drinking water. Greenpeace is reported to consider fracking to be as, if not more, environmentally damaging than the extraction of oil from tar sands.
Meanwhile Toreador estimates there is the equivalent of 65 billion barrels of oil lying locked in the rocks of the Paris Basin, almost twice the total level of reserves held by Nigeria, Africa’s largest oil producer, at 36 billion barrels. Will the lure of massive domestic oil reserves overcome the French normally sniffy attitude towards “irresponsible environmental practices in other parts of the world? If Toreador is proved right in both their exploration activities and their estimates of the total reserves, it will be a massive boost for France although even at Toreador’s estimates of production running at 50,000 barrels a day it won’t make much of a dent in France’s near 2 million bpd daily consumption for many years to come. If estimates are proved correct a big if it must be said France could qualify as a member of OPEC! Now that would be an amusing sight, Nicolas Sarkozy sitting down with his fellow heads of state in Vienna, Riyadh or Tripoli to discuss what the price of oil should be. Having said that no European countries have ever joined the cartel. Norway and Russia sent observers but never joined and the UK stayed firmly outside, but then again the French have always rather liked running big clubs, look at the EU, may be it would be too much of a temptation to resist.