Related Articles
Forward article link
Share PDF with colleagues

Total contests revoked French shale-gas licence

Firm prevented from exploring Montélimar region

Debate over whether France should exploit its shale-gas reserves has taken a new twist, with Total’s decision to contest a government decision to withdraw its licence to explore the Montélimar region of southern France.

"We will contest the cancellation of our Montélimar licence," chief executive Christophe de Margerie said on Saturday. "We have respected the law and we do not understand why the law has been invoked to revoke our permit."

The French parliament voted to ban hydraulic fracturing (fracking) in May, swayed by concerns over potential environmental damage from the shale-gas extraction technique. That led the government to withdraw existing shale exploration licences in October – those belonging to Total and US-based Schuepbach Energy, both of which were poised to explore in Montélimar.

Total is objecting to the move because it says it has told the government it will not use any banned technique, including fracking, as part of its exploration and production programme. So, Total claims, it should be allowed to keep its licence. The firm was awarded the five-year exploration permit, covering 4,327 square km, in March 2010.

In September, it said in a report to the French authorities that it didn’t envisage using fracking in the initial phases of its work programme on its acreage. "Any oil or gas deposit encountered – conventional as well as unconventional – will be assessed. No production tests will be performed during this phase," Total said, adding that if it did move on to production testing it would do so using only techniques permitted under prevailing laws.

But environment minister Nathalie Kosciusko-Morizet said in October that she did not find Total’s report credible, given the company’s failure to identify a viable alternative to fracking for shale-gas extraction and the limited potential of the licence area to produce conventional gas. She also said Schuepbach has made no proposal to use any technique other than fracking.

In practice, Total may be hoping that it can retain its licence following a possible parliamentary U-turn over fracking. Forthcoming presidential and parliamentary elections, to be held between April and June next year, could change the political landscape and, with it, thinking over shale-gas exploration.

There may also be a hope that new extraction techniques could be developed, such as the use of alternatives to the chemicals used, which may be deemed more acceptable. Breaking up shales using propane, or even electricity – a technique under study for decades – are other possibilities. There is little sign that any of these methods is poised to come into its own in the near future, but Total may believe such new techniques could be available in four or five years time, when it may be in a position to drill.

Total says it has until 12 December to contest the government’s decision and that it could appeal to the environment and energy ministries or resort to court action.

Also in this section
Pharos’ main man goes back to the East Med future
7 August 2020
The independent’s CEO was making oil discoveries in the Gulf of Sinai in the 1970s. Now he is back in the region
Independent E&P journey ‘can be done again’
7 August 2020
Ex-Tullow man thinks that doom and gloom about the global upstream business is overdone
Petrobras undeterred by tumbling profits
6 August 2020
Hefty financial losses and a depressed oil market fail to sway Brazilian NOC from pursuing ambitious upstream strategy