The mother of all shale gas battles: France .Published on 31 May...

The mother of all shale gas battles: France
.Published on 31 May 2013 Written by Nick Grealy ..The most beautiful words in the English language are not “I love you”, but I told you so.Over the past five years here, my errors have consistently been in over-caution. People told me I was mad in 2008 when I first started telling Europe that the world was not running out of gas. They really started looking for the men in white coats when I said three years ago that the US had so much gas that exports were inevitable. Bakken, Eagle Ford, UK shale, East Africa gas, Australia underestimated them all.

So remember that when I tell you now:

France is shaping up to be the mother of all battles for shale energy.

And shale will win.

I’ve consistently noted that the big problem in France is the battle has been about shale gas, when the real issue should be oil. The Paris Basin is the European Bakken, with a potential for billions of barrels of oil. I’ve also been an unwavering optimist on the potential for shale energy and France. Have I been wrong? No. It’s just that I have been too early.

Let’s go to the video tape here, or the DVD to be exact and see how we got in the French mess, and how sooner than people think, we’ll be getting out of this

The histoire goes like this, and starts with the Gasland movie. Josh Fox, the film-maker behind “Gasland” may have had more of a desire to make a piece of art than create a movement, originally had an intent to describe gas drilling in Pennsylvania. Where the narrative starts going both haywire and making some sense, is when Gasland jumped the ocean.

Being a film student (but without a rich mum and dad) at NYU, (Fox was a theatre major at Columbia), I can appreciate how the Fox/Gasland story becomes an attractive trope in a Jerry Lewis/ Woody Allen nebbishy manner attractive to French intellectuals. In this regard, it helps I speak French, whereas Fox seems to simply drone on in a monolingual monotone that achieves the near impossible: it makes banjo interruptions welcome.

While Gasland appealed to a left/green paranoia over Dick Cheney and oil companies, it only provided a spark to French shale gas opposition. A number of bad political stars aligned in France to achieve the near impossible: almost every political party suddenly jumped on the anti-shale bandwagon. I won’t bore you with the details, but the French shale ban from July 2011 was the result not of green socialists (then in the minority) but of them being joined by many from then President Sarkozy’s party in a complex, even by Byzantine standards of French politics, fight between Sarko and then Ecology minister Jean-Louis Borloo that had zero to do with shale gas. Throw in Borloo’s successor Nathalie Kosciusko-Morizet and the general confusion which precedes any Presidential election, and a total lack of information from Total which led to complete misunderstandings of the process itself, and French shale quickly drove into the ditch.

One day, I’ll write a book, but the French anti-frackers would have chatons (kittens) if I revealed more and I would only do the cause more harm than good. I will say I was present in the Senate the day the French shale law finally was passed, but the final nail in the coffin of French shale was driven in a month later by including a fracking sub-plot in France’s most popular soap opera “Plus Belle la Vie” as I described in August 2011. Talk about art imitating life, this was soap opera imitating something worse: politics.

Fast forward two years and we have Francois Hollande, elected last year on a program to re-invigorate the French economy. Since his election only two things have remained consistent: the economy is getting worse and his opposition to shale has endured. The shale opposition is notable on two fronts. First, despite what Anglo Saxons might think France has far more actual industry than the UK does, and companies like Total, GdF Suez, Vallourec and Technip are at the forefront of the shale revolution - just not at home. The companies invest billions of Euros outside France on the same technology that can’t be used in France because it allegedly poisons the water supply in an unavoidable fashion. France, being France, sees no inconsistency here. Imagine the mess if major British firms invested in alleged cancer or poison in other countries. In France, the good protesting pensioners of the Ardeche, hold their noses and open their wallets.

Hollande’s opposition is even more bizarre, as a wide range of his own ministers, policy advisers, employer’s federation and the main trade union group have all proposed that it’s crazy for France not to even look for shale. They’ve been joined by various others on both left and right and one could say that today, it’s changed the other way.

First off, Hollande himself. Last autumn, we had a Presidential Commission on competition and jobs (Gallois) which suggested as a key plank that France at least look for shale energy. Shale also had the support of the Minster of Industrial Renewal, Armand Montebourg, a key rival to Hollande from the left of the party, former PM Michel Rocard and postive words that France should at least look for shale from the current Prime Minister Jean-Marc Ayrault.

We’ve seen far more positive and informed discussion in the French press of both left and right, especially from Le Monde and the business paper Les Echos than we’ve had from UK equivalents. We’ve seen a concerted push from the French employer’s federation but also from the trade unions.

We’ve seen a push just this week where in a rare cooperative attempt for a growth strategy, employers and unions united to have a push for shale gas exploration as a key plank for growth.

But we have three problems. First and second, Hollande himself ignores advice from everyone except his Environment Minister Delphine Bartho. I leave up to your imagination any of the scurrilous rumours one can find in France about that back story, but it’s more likely to be politics, or money, than anything else.

Thirdly, the French Green Party has consistently warned that supporting shale gas was crossing the red line and they would withdraw their support from the government. That is the true mystery. Greens in France have very thin support in national elections, being completely destroyed in the Presidentials for example. At the national level, they only have 17 seats out of 577 and Hollande or Ayrault do not depend on them for a majority.

French left green magazine Politis this week has a front page article on “The return of shale gas” and says “The hour has come for the mother of all battles for shale gas”.

But the mother of all battles is a term that came from the first Iraq war. How did that work out for you?

On the economic front, Hollande has had to go cap in hand to the EU, and specifically Economy Commissioner Olli Rehn, for permission to operate outside of deficit targets.

But Rehn was just one of the participants at a German Marshall Fund event I was at in Brussels earlier this week, where the EU Directorates of Industry, Energy, Climate and Rehn himself came out for a more rational and realistic policy towards shale gas.

Today, we have news that French unemployment has reached 3.2 million. If Francois Hollande does not bend to reality, he will have reality pushed on him.

A participant told me this week, that one can’t go to the bank for a loan and ignore the gold mine in the basement. France’s refusal to even contemplate accessing shale energy has no scientific or economic, or now, political base.

Let the mother of all battles commence. Les Miserables will win this time.

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