UK shale gas resources 'greater than thought'

 

Osborne: "Local communities should get, for example, at least £100,000 for every fracking well that is created"

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UK shale gas resources may be far greater than previously thought, a report for the government says.

The British Geological Survey estimates there may be 1,300 trillion cubic feet of shale gas present in the north of England - double previous estimates.

Meanwhile the government has announced measures to enable shale gas drilling as part of its infrastructure plans.

Energy Minister Michael Fallon described shale gas as "an exciting new energy resource".

The BGS said its estimate for shale gas resources in the Bowland Basin region, which stretches from Cheshire to Yorkshire, represented potential resources, but "not the gas that might be possible to extract".

"Shale gas clearly has potential in Britain but it will require geological and engineering expertise, investment and protection of the environment," it said.

Drilling companies have previously estimated that they may be able to extract around 10% of this gas - equivalent to around 130 trillion cubic feet.

Shale gas map
'Early days'

If the estimates are proved correct, that would still suggest recoverable reserves of shale gas far in excess of the three trillion cubic feet of gas currently consumed in the UK each year.

Shale gas is extracted through "fracking" - the controversial process of freeing trapped gas by pumping in a mixture of water, sand and chemicals.

Analysis

The truly massive shale gas resource of the north of England may bring tax revenues and possibly - not definitely - lead to lower bills, but it won't help the environment.

This week the government's climate change advisers warned that the UK was failing to keep pace with legally binding cuts in the CO2 emissions that are disrupting the climate.

The Environment Agency warns that if we want to keep burning gas we will have to rely on unproven technology to capture the carbon emissions in order to meet climate change targets.

It also warns that gas escaping from fractured wells may increase climatic disruption.

Meanwhile the International Energy Agency warns that the world can only burn a third of its existing fossil fuel reserves without a serious risk of de-stabilising the climate.

Shale gas plans will meet local environmental opposition too.

The process has helped boost the domestic energy industry in the US in recent years, where oil production has risen and gas prices have plummeted.

In a statement, the Department of Energy and Climate Change said: "Though it is early days for shale in the UK, it has the potential to contribute to the UK's energy security, increase inward investment and growth."

The government has unveiled a package of reforms to encourage development in the industry.

They include new planning guidelines to make the process of approving new drilling sites more streamlined, and a consultation on tax incentives to encourage exploration.

Communities affected by shale gas drilling are also expected to receive £100,000 in "community benefits" and 1% of production revenues, should sites start producing gas.

"Shale gas represents an exciting new potential energy resource for the UK, and could play an important part in our energy mix," said Energy Minister Michael Fallon

"Development must be done in partnership with local people. We welcome the commitments from industry on community benefits.

"This will provide a welcome boost for communities who will host shale exploration and production as well as offering strong assurances that operators will engage with them and work to the highest health, safety and environmental standards."

fracking graphic

He said communities hosting shale gas drilling could benefit from cheaper bills, regeneration schemes and new community facilities like playgrounds and sports halls.

The incentives are designed to overcome significant scepticism surrounding the process of fracking, which has generated environmental concerns.

Critics argue that it can cause earth tremors and pollute water supplies, and that shale gas wells could blight the countryside and affect house prices.

They also want investment in green energy sources, rather than fossil fuels.

Labour's shadow energy minister, Tom Greatrex, conceded that gas would remain "an important part of our energy mix in the future".

But he dismissed the announcement of incentives as "a desperate attempt to draw attention away from the government's cuts to infrastructure investment... and its abject failure to get the economy growing".

Power warning

Currently the UK's shale industry remains in its infancy, with relatively small energy companies such as IGas and Cuadrilla until recently the only firms with licences to explore share gas resources.

Centrica, the owner of British Gas, announced its intention to buy a stake in one licence in the Bowland Basin owned by Cuadrilla earlier this month.

The report for the government comes as energy regulator Ofgem warned that the risks of power blackouts has increased because excess capacity in the power industry has fallen in the UK.

The watchdog has twice warned in recent months that the amount of spare power is shrinking, partly due to some gas generators being taken out of service.

Centrica has already withdrawn two of its gas plants from operation. In April, SSE confirmed that it too would mothball gas plants and put off investments in new ones.

Adam Scorer, of the lobby group Consumer Futures, said: "Projections of ever-tighter capacity margins understandably raise fears of higher electricity prices.

"Government and regulator need to agree on the most realistic capacity scenarios, the least-cost ways of reducing demand and, where necessary, of incentivising new generation capacity."

Announcing further details of the government's spending review to parliament, Treasury Secretary Danny Alexander said the government had agreed "strike prices" in an effort to boost investment in renewable forms of energy.

The prices mean the government will guarantee to pay a certain price for energy generated through on-shore and off-shore wind, tidal, wave, bio-mass and solar power.

 

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  • rate this
    0

    Comment number 307.

    The first commercially successful fracking applications were in 1949. This is a proven technology. We either go back to horse and buggy or use what we can while developing sustainable energy sources.

  • rate this
    +6

    Comment number 306.

    Thorium

  • rate this
    +1

    Comment number 305.

    Perhaps people should watch the Gasland (2010) documentary on fracking available on Youtube.com - Fracking is not an environmentally safe method of extraction.

  • rate this
    +4

    Comment number 304.

    12. McGill

    I don't disagree with the sentiment, but, it could mean an independent gas supply for the UK.

    Personally, I am not at all comfortable with our reliance on supplies from Russia, especially when people like Putin have their hands on the 'on/off' valve.

    I think it's worth the investment even if it doesn't save us money. In the long run, it might secure supplies.

  • rate this
    +2

    Comment number 303.

    Good in theory for the UK, but I am hoping that the governments of the day watch the energy companies like a hawk to ensure that any negative impacts on the environment are eradicated as much as possible. It's up to the government to act on our behalf to ensure this happens. Recent history with all manner of scandals emerging suggests that we shouldn't hold our breath

  • rate this
    +1

    Comment number 302.

    So it seems that the big corporates have found 1,300 Trillion cubic feet of gas under your feet and they want to get their hands on it. Not for profit, you understand, but because it will make your gas much cheaper and stop your lights going out.

    Just try and ignore the earthquakes, water pollution, radioactivity and other environmental issues as you collect your £100k bribe.

  • rate this
    +2

    Comment number 301.

    The advantages of fracking are very tempting (i.e. more gas, resulting jobs etc.) however I'm not convinced that the environmental impact has been properly researched; especially for an island as densely populated as Britain.

    If the research is positive, I'd say go for it

  • rate this
    +2

    Comment number 300.

    "Wind is unreliable, unsightly and costly. "

    In this country, wind is as reliable as wave power.
    And as for the whingeing about it being 'unsightly', I'd ask you to consider carefully whether you'd prefer your children to grow up healthy watching the windmills go round, or end up with serious health problems for which today's wealthy politicians will deny all responsibility.

    Think carefully.

  • rate this
    +8

    Comment number 299.

    Put in clear terms...It has been proven that fracking causes earthquakes . Test fracking in north Wales last year ...Earthquakes in Wales this year :)

  • rate this
    +1

    Comment number 298.

    No doubt a private firm will get the shale and shareholders and CEO reap the profit, The country owns the gas and as such should be recovered by government and lower prices passed to customers, This of course will not happen as the corrupt MPs may not get elected to boards etc. and continue to line their pockets !!!!

  • rate this
    0

    Comment number 297.

    no doubt there was the doomongers were out when we first started extracting coal from the ground...when we first started down the road with nuclear energy. The protests from the 'green lobby' as ever are from the interested parties who want us to go down that road. There is always some interested parties against any new development. Nothing would ever get done if you did what they want.Listen yes!

  • rate this
    +2

    Comment number 296.

    I don't get why the government aren't putting solar panels on every single public building and that new build houses should be required to have solar panels on them. This would go a huge way to solving the energy crisis and reducing our need to yet more power stations.

  • rate this
    +4

    Comment number 295.

    The energy shortage, or potential energy shortage we are approaching was forcast back in the 1980's. Decisions are ducked again and again. Even now, the Conservative's won't look ahead.

  • rate this
    -2

    Comment number 294.

    What an outrageous comment from Roger Harrabin in his analysis when he states categorically that CO2 emissions are disrupting the climate. There is not one shred of evidence that this is the case - all we have is a theory. No one has a clue as to whether the 3% of atmospheric CO2 supposedly down to us has any discernible influence on climate or temperatures.

  • rate this
    +6

    Comment number 293.

    So far anyone who has pointed out that we are heading for a deep energy crisis has been downvoted. We have 2% spare capacity. One problem at one station and we face a blackout. This is not a case of "Oh, I'll read a book for five minutes and wait for the power to come back on." A blackout that hits the City will suspend trading and wipe billions off the UK economy. You will feel this.

  • rate this
    +12

    Comment number 292.

    Micro generation, not fracking.
    All new houses should have solar panels as part of the build.

  • rate this
    +1

    Comment number 291.

    15 years it was predicted that the US would become import LNG & subsequently oil majors spent billions on LNG import terminals in the US. The terminals have sat idle since Shale gas came along & now they are looking at export the LNG to Europe etc. The irony is the UK has just done the same by building an LNG terminals in Milford Haven & Isle of Grain(at the cost of billions. Watch this space!!

  • rate this
    +6

    Comment number 290.

    It's a dream come true for Cameron. Tory voting investors in the South East make a pile of money and Labour voters in the North West suffer all the consequences of uninsurable, unsaleable, subsiding property, methane poisoning and polluted drinking water.

  • rate this
    -14

    Comment number 289.

    Everybody knows that fracking totally destroys the countryside and may have serious, un-researched knock-on effects, e.g. earthquakes, polluted ground water, etc. BUT, importantly such energy solutions promote greenhouse gases and CO2 emissions. Fracking and all non-renewable energy solutions must be discounted as destroying the environment and mankind. Get out of your cars.

  • rate this
    +1

    Comment number 288.

    Typical of this government.

    Policies where workers can sign away their rights for a few £'s

    and now this where the local community will receive paltry "benefits" whilst risking earthquakes, environmental damage and poisoning of the water supply for them and generations to come.

    It should only be okayed when george agrees to have it on his land & drink 2 pints of that water every day

 

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