Investor's concerns lead to calls for fracking changes A top-10 investor in BP and Royal Dutch Shell has called for changes in the way oil companies produce shale gas, in a further sign of shareholder disquiet about the environmental impact of fracking. Scottish Widows Investment Partnership - which owns a 1.87 per cent stake in Shell and 2.2 per cent in BP as well as smaller holdings in Chevron, ExxonMobil and Total - called on the industry to take "rapid action" to eliminate emissions of climate-warming methane in gas production. It said methane leakage "greatly undermine[s] the attractiveness of natural gas as a fuel source." Dr Craig Mackenzie, SWIP's head of sustainability, urged companies to tackle the problem. He said technologies existed to deal with methane quickly and at low cost, but they were not widely used. "If the oil and gas industry really wants to tackle climate change, it needs to show it can eliminate fugitive methane emissions," he said. SWIP's intervention is the latest evidence of investor concern about the potentially damaging effects of shale gas production. Attention is mostly focused on the technique known as hydraulic fracturing, or "fracking," in which huge volumes of water, sand and chemicals are used to break up shale rock and release the gas trapped inside. Fracking has led to a huge increase in US gas production, driving prices down to 10-year lows. But environmentalists and some academics say fracking can pollute drinking water and even cause earthquakes. The energy industry insists it is safe, and has blamed water contamination, when it occurs, on poorly constructed wells. In the past few years, oil companies have come under increasing pressure from shareholders to disclose the chemicals used in fracking, and give greater assurances on safety. This month, 55 institutional investors in the US with nearly $1tn in assets under management teamed up to support "best practices" in fracking, such as assuring well integrity, reducing and disclosing toxic chemicals and minimising the use of fresh water. Some scientists looking at shale gas have also expressed concern about emissions of methane, a potent greenhouse gas. Small amounts often leak or are vented into the atmosphere when gas is produced, transmitted through pipelines or stored - though such "fugitive" emissions are particularly high for shale gas. Dr Mackenzie said the problem often arose when companies pumped out fracking fluids from wells, releasing bubbles of dissolved gas as well as some early gas production in the process. Some operators vent this early gas for weeks before hooking the well up to a pipeline. In a report that surveys a body of recent research on the topic, SWIP said the problem of methane was cancelling out the climate benefit of switching from coal to gas in the power industry. Gas-fired power plants produce half as much carbon dioxide emissions as coal-fired generation. SWIP said the switch to gas would have a "substantial benefit in the end, but there is a heavy price to pay for several decades." Compared with carbon dioxide, methane decays rapidly in the atmosphere but has a strong warming effect in its short lifetime. Some oil and gas companies are trying to prevent leaks, putting technology in place to capture methane from their operations. Royal Dutch Shell, for example, is committed to reducing emissions through a process known as "green completion." SWIP said it would be using its influence as a shareholder in the western oil majors to "support and encourage efforts by companies to implement best practice methane control technologies," and raise awareness of the methane issue with other global investors and "build support for effective action."