10/07/2014 11:31 EDT | Updated 12/07/2014 05:59 EST

Nova Scotia energy minister faces industry criticisms, questions at conference

HALIFAX - Nova Scotia's energy minister faced questions Tuesday about how the province will become a centre for research in hydraulic fracturing technology while it moves to ban high-volume fracking for onshore oil and gas.

Andrew Younger told the Core Energy Conference in Halifax that there hasn't been much industry interest in the method so far, and the majority of people in the province remain opposed to fracking.

The Energy Department plans to provide a detailed geological map to show where onshore oil and gas opportunities might exist, he said, adding it will also allow more informed debate in the future.

"To start with, we need to know what the resource potential is," he said. "We are doing the onshore atlas at this point to identify what the resource opportunities are and it will make it easier to have those discussions in the communities about real opportunities."

Asked if his department would work to reduce community fear about possible risks to watersheds and other environmental issues associated with fracking. Younger said he is surprised there hasn't been more industry involvement in making its case to communities.

The Liberal government recently introduced amendments to the Petroleum Resources Act to ban fracking.

Meanwhile, senior executives with utilities in New Brunswick and Nova Scotia said the supply of natural gas could decrease in Atlantic Canada over the next decade.

Chris Huskilson, CEO of Emera (TSX:EMA), said after 2019, most projections are for natural gas production to decrease in Nova Scotia's offshore.

"We have to start to think about how we are going to supply natural gas to the region in the future," he said.

NB Power president Gaetan Thomas agreed: "We do need some natural gas and we will get it somewhere."

A local source of natural gas would be 20 to 25 per cent cheaper for utilities, he said.

"I think over time, studies will reveal that you can do it (hydraulic fracturing) safely and we'll take it, as a utility, no matter where it is coming from if it's cheaper," he said.

The recently elected Liberal government in New Brunswick has said it will make good on an election promise to impose a moratorium on hydraulic fracturing for shale gas. The party has said the province will first do studies on any risks to the province's water, health and environment.

Huskilson said the natural supply issue may partly be solved by hydroelectricity from Muskrat Falls and the Maritime Link project that will bring power from Labrador to the Maritimes.

The $8.5-billion projects are on time, he said, and there has been no increase in the cost.

He said he could foresee a scenario where only five per cent of Nova Scotia's energy will be produced from natural gas, rather than some projections that have imagined 35 per cent of energy coming from the hydrocarbon.

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