17 August 2017

Morocco Takes On Challenges of Gas and Oil Shale Exploration

Photo: Daily News
(File photo).
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Morocco is moving judiciously to ensure a balance between environmental concerns and prospective economic benefits as it approaches opportunities to exploit gas and oil shale for badly needed energy. The UK company, Sound Energy recently announced that it had found commercial quantities of gas in the interior of Morocco, noting that oil and gas shale prospects were also worth considering.

The company, in conjunction with its Moroccan partner, has received approval to build a transit pipeline from its sites in L'Oriental province to link into the existing Gazoduc Maghreb Europe (GME) pipeline. While traditional gas drilling technology is being used at this stage, the company believes that the possible use of shale technologies should be considered as Morocco strives to meet its national energy goals.

It is a bit of an irony that the gas and oil shale that are emerging as the first targets of opportunity are located in an undeveloped region with high levels of poverty, similar in terms of economic profiles to fields in the US in Pennsylvania, North Dakota, and Oklahoma.

An article posted at equaltimes.org, describes the area in vivid terms. "Morocco's eastern steppe is comprised of sparsely populated, immense plateaus with scant vegetation. The poverty in this region is endemic, affecting 28.5 per cent of the inhabitants, a level three times higher than in the rest of the country, according to the official figures published by the statistics office of the High Planning Commission. Desertification and persistent poverty constitute major risks for the way of life of the last remaining nomads in the province."

The article goes on to describe the ambivalence among some of the locals towards the gas discovery. Despite the great poverty, "this population is by no means thrilled about the recent discovery of a gas field." One issue is that locals have heard since 1966 that prosperity tied to potential gas finds was just around the corner. Gas prospecting has been going on in the area since the 1960s, and until now, the volume of gas found was not commercially viable. This shifted in April 2016, when Sound Energy and its Moroccan partner, Oil & Gas Investment Fund (OGIF) received a permit and were soon reporting gas in potentially commercial quantities.

"Morocco has 900,000 square kilometers of sedimentary basin with a high gas potential, and yet barely half of that has been seriously explored," said previous Energy Minister, Abdelkader Amara, during the 2014 Morocco Oil & Gas Summit. As a result of Morocco's proactive energy incentives to change that, there are now 32 companies with exploration permits, some of which are expecting promising results.

While new exploration is feeding hopes of an economic upturn that would help to address the migration of youth to nearby urban areas, the traditional lifestyle tied to grazing and sedentary agriculture will be impacted, and must be taken into consideration, according to local NGOs.

As one local official noted, "We know these discoveries will not change the region overnight. Our neglected towns and villages are, above all, in need of basic infrastructure." For example, fully a quarter of the 400 inhabitants of Maâtarka, a small village, live under the poverty line, the health clinic has no running water, and the village school opens only intermittently.

Similar villages in the region have fallen into neglect and been abandoned. This feeds a very high rate of youth unemployment. The column notes that "Despite the huge needs in these villages, the hopes of gas being discovered are tempered by fears of the environmental consequences of this activity on land that is fragile."

The government's position is quite clear. A public document makes no secret of the government's desire to utilize these potential energy resources. But it has also made clear that it recognizes the importance of protecting a fragile environment.

The government and Sound Energy have held public meetings to explain that no licenses have been issued at this time for fracking or other controversial non-conventional gas prospecting methods. Sound Energy, proceeding with conventional gas exploitation, is operating "in compliance with all the country's environment standards," and is committed to the economic development of the area beyond the gas fields. It expects to make an announcement in 2018 regarding potential gas supplies, with production activities commencing the following year.

This is especially critical for Morocco, which currently imports more than 95% of its energy needs, and is making huge investments in solar, wind, hydro, and other technologies. With a growing population, energy demand will continue to challenge the country's capacity to meet its energy needs without a robust and diversified energy sector.

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