Energy Minister Donald Arseneault says the New Brunswick government will indefinitely extend the province's moratorium on hydraulic fracturing.

The energy minister made the announcement on Friday in Fredericton. It was in response to the February report from the Commission on Hydraulic Fracturing.

Arseneault said the shale gas industry still has not met the conditions necessary to lift the moratorium.

"We have been clear that we would not allow this activity to go forward unless our five conditions were met," Arseneault said in a statement. 

"Creating jobs is our number one priority, but not at any cost. It is clear that our conditions cannot be satisfied in the foreseeable future."

Premier Brian Gallant's Liberals imposed a moratorium on the shale gas industry shortly after winning the election.

The provincial government then appointed the hydraulic fracturing commission in March 2015 to investigate the contentious issue.

The three-volume document offered a long list of recommendations on steps the provincial government could take if it opted to allow for shale gas development.

Arseneault said there is still nothing in place to treat wastewater from fracking sites. And he said industry still has not accommodated First Nations concerns.

The energy minister said the provincial government's response to the commission's report "strikes the appropriate balance" between economic development and protecting the environment.

He said the Liberal government will continue to support other projects, such as the proposed Energy East pipeline and the Sisson mine.

Industry inaction

Bruce Fitch

Opposition Leader Bruce Fitch said the provincial government must accept the blame for the industry's lack of action on consulting with First Nations and handling wastewater from fracking sites. (CBC)

The Energy minister pointed to two specific failures on the part of industry. He said the industry has not come up with a plan on how to handle wastewater from fracking sites and companies had not properly consulted with First Nations.

Rebecca Knockwood, the chief of the Fort Folly First Nation and co-chair for the Mi'kmaq Chiefs of New Brunswick, said the province made the right decision.

"While the [Mi'kmaq] chiefs welcome the news regarding the extension of the moratorium, we must remind the premier and his ministers that they have much work to do to repair the Crown's relationship with its treaty partners before the other projects, which have the unqualified support of the current government, can move forward with First Nations' support," Knockwood said in a statement.

Opposition Leader Bruce Fitch, meanwhile, pinned the blame on the Liberals for the industry's lack of action on some of these areas, including consulting with First Nations.

"I mean they killed the industry 18 months ago and now they're blaming the corpse for inaction," he said.

'Victory for reality'

Joel Richardson

Joel Richardson, the vice-president of the Canadian Manufacturers and Exporters in New Brunswick, said the provincial government has essentially put a "full ban" on the natural gas industry. (CBC)

The Liberal government's decision to maintain the moratorium was met with frustration from industry groups and support from anti-shale gas groups.

Jim Emberger, an opponent of hydraulic fracturing, was at the news conference on Friday and he told reporters that the decision was a "victory for reality."

He said after six years of fighting the possibility of a fracking industry in the province, he is happy to return to a "normal life."

Meanwhile, an industry official called Arseneault's announcement "very unfortunate."

Joel Richardson, the vice-president of the Canadian Manufacturers and Exporters in New Brunswick, said the provincial government has essentially put a "full ban on the industry."

Richardson said this is an ideal time to embrace new industrial projects because of the number of people looking for jobs or oil and gas workers who have returned from jobs elsewhere.

"We have the people and the resources ready and willing to do the work here in our own province and our provincial government is essentially saying no, at a time when New Brunswick truly needs the jobs and also the provincial government desperately needs the revenue opportunities that come from direct and indirect taxation to pay for services," he said.

Colleen Mitchell, the president of the Atlantica Centre for Energy, said the provincial government's decision will have immediate and long-term implications.

"New Brunswick is certainly foregoing potential royalties from investment … that is current, even in this economic climate, even with energy prices at historic lows," she said.

"There still is interest by energy companies in making these investments, I think today's announcement by the provincial government will certainly not be attracting that kind of investment to New Brunswick."

Mitchell also said the moratorium will prevent companies from determining whether there is enough shale gas in the province to justify a future industry.

Commission's recommendations

The hydraulic fracturing commission had three members, including John McLaughlin, the former University of New Brunswick president, Cheryl Robertson, a former New Brunswick Community College chair and Marc Leger, a former clerk of the executive council.

The commission made several recommendations, including a single, independent regulator for the industry.

Arseneault said the provincial government will continue to work on this idea, but he did not set any timelines.

The Energy minister repeatedly blamed the former Tory government for the state of the industry in the province.

The former Progressive Conservative government of David Alward staked its 2014 re-election bid on shale gas.

Hydraulic fracturing, also known as hydro-fracking or fracking, is a process that involves pumping a mixture of water, sand and chemicals into the ground at high pressure, which creates cracks in shale rock formations and allows companies to extract natural gas from areas that would otherwise go untapped.

Opponents of the shale gas industry have long argued the fracking process can contaminate groundwater.