We Were Disappointed in the Inconsistencies Evident in This Report

June 5, 2014

To: Dr. David Wheeler

Chair of the Nova Scotia Review of Hydraulic Fracturing Committee

From: Barbara Gallagher

Chair of Citizen Action to Protect the Environment

Dear Dr. Wheeler,

I am responding to the third discussion paper, The Potential Oil and Gas Resource Base in NS Accessible by Hydraulic Fracturing, on behalf of members of Citizen Action to Protect the Environment (CAPE), a Hants County- based registered society. You may recall from a previous response that our members reside within the Windsor Block where a production lease was in place prior to the current moratorium on hydraulic fracturing.

We were disappointed in the inconsistencies evident in this report. We find that there is insufficient information to support the first conclusion on page 17:

Exploration companies see attractive oil and gas potential in the unconventional reservoirs of Nova Scotia.

It had been pointed out in the Executive Summary that:

There is no commercial oil and gas production established to date, with only limited on-shore development.

Knowledge of the subsurface is extremely limited so it is “very difficult to quantify the potential”.

The range of estimates (e.g. for Windsor- Kennetcook Basin) “reflect inherent uncertainties”p.7

In Section 4:

It’s pointed out that oil and gas have only been produced from unconventional reservoirs for about a decade, so they have “little guidance on how much of the resource can be produced”, and routinely assume relatively low recovery factors, in the 5- 25% range.

The authors do not attempt to generate area-specific recovery factor estimates, since appropriate data and comparisons to do so are lacking. (p.8)

Data on specific basins are not readily available (p.11)

In the Horton Bluff formation (Windsor-Kennetcook Basin) test wells by Triangle Petroleum failed to produce. (p.12) We were surprised that very relevant specific information about these exploration trials was not included in this document.

Much of this report reads as an industry promotional document to entice shareholders to invest. CAPE members acknowledge that to attract industry investment, there “must be a good promise of potentially profitable discoveries”(p 14). With specific and quantifying data not available, we can understand the need to search for successful analogues. We also are aware that some companies have promoted inflated resource projections. When estimating the potential volumes in the Windsor-Kennetcook Basin as 17- 69 trillion cubic feet, the reader should also be made aware of the recent downgrade by Energy Information Administration for Monterey Shale, a similar play, by a reduction of over 95%.

In May, several CAPE members attended an information session in Hants County where Dr. Duncan Keppie presented his views on whether fracking would have viable potential in the Windsor-Kennetcook Subbasin. He reiterated that US shale gas and oil reserves have been overestimated by 100 to 500%. The role of pre-existing faults and fractures was emphasised and their impacts on shale gas potential and possible problems during fracking, including fluid escape. He pointed out types of data not currently available but necessary for obtaining a proper estimate of the resource. We strongly agree with his recommendation that no production licences in Nova Scotia be awarded until a reliable database is available.

Respectfully submitted,

Barbara Gallagher

Chair, CAPE