UK shale gas reserves may be 'bigger than first thought'

Andrew Austin, chief executive of IGas, explained why the company wanted to exploit the UK's resources of shale gas

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One of the energy firms hoping to exploit the UK's resources of shale gas says it may be sitting on significantly more gas than previously thought.

UK firm IGas says there may be up to 170 trillion cubic feet (4,810 cubic km) of gas in the areas it is licensed to explore in northern England.

But it remains unclear how much of the gas will be economically extractable.

Shale gas is extracted by fracking - pumping water, chemicals and sand at high pressure into rock to release gas.

Critics argue that the process may cause earth tremors and want investment in green energy.

Fracking has revolutionised the US energy market and the energy industry has hopes for a similar transformation in the UK.

'Benefit communities'

IGas is one of the companies granted a licence by UK authorities to explore parts of the country believed to contain large resources of shale gas.

The company's licences cover an area of 300 sq miles across Cheshire.

It had previously said it had about nine trillion cubic feet of shale gas. It now estimates that the volume of "gas initially in place" could range from 15.1 trillion cubic feet to 172.3 trillion cubic feet, the higher figure being nearly 20 times higher than the previous estimate.

The UK's annual gas consumption is currently about 3 trillion cubic feet.

Shale gas is extracted by fracking - pumping water and sand at high pressure into rock to release gas within it. Shale gas is extracted by fracking - pumping water and sand at high pressure into rock to release gas within it

"The licences have a very significant shale gas resource with the potential to transform the company and materially benefit the communities in which we operate," said IGas chief executive Andrew Austin.

"Our estimates for our area alone could mean that the UK would not have to import gas for a period of 10 to 15 years".

'Dirty and unnecessary'

Energy firm Cuadrilla, which has drilled wells near Blackpool in Lancashire, says it has 200 trillion cubic feet of gas in its licence area of the Bowland Shale.

That suggests the overall number for the region could be in excess of 400-500 trillion cubic feet in total.

"It's not unreasonable to assume that there could be as much as 500 trillion cubic feet in the Bowland shale across the North West," said Mr Austin.

"Even if the industry can only extract a fraction of that, combined with North Sea reserves, it could make the UK self sufficient in gas for decades to come."

The amount of gas that is extractable will become clearer once a significant number of wells have been drilled and gas flow rates tested.

In a report published earlier this year, the Energy and Climate Change Committee also cast doubt on the value of shale gas extraction.

Although it said shale gas in the UK could help secure domestic energy supplies, it also warned that it may not bring down prices.

fracking graphic

The process of fracking also remains controversial - it has been blamed for causing earth tremors and there are concerns about water contamination and the large volumes of water required.

Environmental group Friends of the Earth has described fracking as "dirty and unnecessary", arguing that the UK should instead focus on investing in renewable energy.

IGas plans to carry out exploratory drilling, not including fracking, in Cheshire at the end of the year.

US bonanza

Gas and oil discoveries in shale rock in the US have led to a boom in gas and oil production there recent years, and have also dramatically reduced gas prices.

The International Energy Agency (IEA) says the US will overtake Russia as the world's biggest gas producer by 2015, and Saudi Arabia as the world's biggest oil producer by about 2020.

The shale gas industry is in its infancy in the UK. But supporters believe it could play a key role in our future energy supplies.

A report by the British Geological Survey for the Department of Energy and Climate Change is due to give an updated assessment of how much gas there is in the Bowland Shale in the North West of England in the coming weeks.

Industry sources have told the BBC they expect the BGS assessment to result in a "very big number".

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