Bulgarian Assembly Votes to Ban Hydraulic Fracturing - For Now

Next to nuclear power, the hydraulic fracturing natural gas extraction technique, more familiarly known as "fracking," is perhaps the world's most contentious energy production method.

Bulgaria, a former Soviet satellite state, joined the North Atlantic Treaty Alliance in 2004 and the European Union in 2007.

Despite a 2010 World Bank report noting that Bulgaria imports 43.79 percent of its energy needs, the country has decided to give the controversial "fracking" procedure a pass.

The Bulgarska Telegrafna Agentsiia news agency reported that after a fractious debate lasting more than four hours, 166 members of the National Assembly 240 parliamentarians voted to impose an indefinite ban on shale gas exploration and extraction in Bulgaria using hydraulic fracturing or other similar technology.

Six National Assembly members voted in favor of the practice, along with three abstentions.

The parliamentarians voted on a motion put forward by Grazhdani za Evropeysko Razvitie na Balgariya (Citizens for European Development of Bulgaria, or GERB) which stated that the ban on the controversial method is indefinite and applies to Bulgarian territory and the adjoining territorial waters in the Black Sea, adopted in principle a draft moratorium proposed by RZS party leader Yane Yanev.

Yanev told reporters, "Our arguments are against the method of exploration and production (techniques) which use toxic, carcinogenic substances."

The vote represents a stunning reversal for the proponents of fracking, particularly from an East European country that imports more than half of its energy needs and has been locked in dispute for years with the major provider of its natural gas requirements, the Russian Federation's state monopoly Gazprom.

Even more extraordinary is that the legislation passed in the face of fervent lobbying by the U.S. ambassador to Bulgaria, James Warlick.

In an interview with Bulgaria's Nova TV prior to the vote Ambassador Warlick told viewers that Bulgaria needs to find the right way to regulate shale gas development instead of banning it, giving the example that while there may be a risk in operating nuclear power plants (NPPs), instead of being banned they are regulated and that this should provide a template as for how the shale natural gas issue should be handled.

Drawing on U.S. experience Ambassador Warlick continued that since shale gas extraction started in the U.S. the local price of natural gas dropped and now U.S. consumers pay nearly half the price paid by Bulgarians, who still rely on Gazprom imports. Playing the conspiratorial card Ambassador Warlick warned that calls for a comprehensive shale natural gas moratorium in Bulgaria have come not only from well-meaning but naïve environmentalists, but also from "circles" which have an interest in maintaining high natural gas prices.

In a rhetorical flourish Ambassador Warlick added, "If I were a Bulgarian, I would want to know whether there is shale gas here." Ambassador Warlick then played the employment card, which is currently high profile in the U.S. presidential debates, noting that U.S. company Chevron's investment in Bulgarian fracking carries in its wake a lot of investment and jobs before concluding, "Do you really want to say absolutely 'no' and 'never' to such a company?"

Ambassador Warlick should take some solace from the fact that the National Assembly defeated a draft resolution on a moratorium proposed by the Ataka (Attack) parliamentary group, which proposed introducing a 20-year fracking ban.

But no doubt providing Ambassador Warlick with a Maalox moment, Ataka Volen Siderov advised the government to present a protest note against what he said were Ambassador James Warlick's attempts to lobby for Chevron. Arousing Siderov's ire, on 15 June 2011 Bulgaria's Council of Ministers granted Chevron Bulgaria Exploration & Production EOOD subsidiary a five-year permit to prospect for oil and natural gas in the 1,700 square-mile Bloc 1 Novi Pazar, located in the Razgrad, Silistra, Dobrich, Shumen and Varna regions.

Today's vote required holders of permits for exploration and production using fracking within three months to submit for approval revised projects excluding the banned methods.

So, Bulgaria's National Assembly for the present has decided to continue to pay its bills to Gazprom rather than adopt increasingly controversial fracking techniques heavily promoted by a NATO ally's ambassador.

Before he hits the rakia to drown his sorrows, Ambassador Warlick should remember that the National Assembly did not say "ne" ("no") to fracking, just "n? s?g?" ("not now.")

By. John C.K. Daly of Oilprice.com