UK may inherit a new gas bonus

22 September 2011


The ground under northwest England may contain 200 trillion cubic feet of shale gas, a resource on the same scale as some of the vast shale-gas finds that have transformed the USA's energy industry, according to Cuadrilla Resources, a small oil-and-gas company with operations in England's Bowland Shale, Lancashire.

The find highlights the U.K.'s emerging position as a new frontier for what is referred to as 'unconventional' gas exploration. But it is also controversial and has angered environmental groups who say the technology used to extract shale gas is environmentally damaging. The technique is known as hydraulic fracturing, or "fracking," which involves injecting huge volumes of water, sand and chemicals deep underground, creating fractures that allow the gas trapped inside the shale rock to flow out. Critics fear that fracking can contaminate ground and surface water, cause gas to leak into domestic water supplies, and even detonate landslips or small earthquakes. In fact the drilling was suspected of causing two small earthquakes in the area in June, triggering calls by members of parliament for a thorough investigation of the technology and a temporary suspension of drilling. A study by a group of independent experts to determine whether there was a link is expected to report its findings in the next few weeks,

Some energy experts are also warning against a dangerous return to reliance on gas, which runs the risk of leaving the country with stranded gas plants when the gas runs out and is in any case only a partial remedy for the problem of CO2 emissions. This notion is taken seriously. Chris Huhne, energy and climate change secretary, said on 19 September that he intended to halt the UK's new "dash for gas" because if unchecked it would break legally binding targets for carbon dioxide emissions,

However, Cuadrilla's announcement could lead to sharp upward revisions in estimates of Britain's shale-gas potential. The country has traditionally ranked low on the list of European shale-gas players, with only 20 trillion cubic feet of technically recoverable shale-gas resources, compared with Poland's 187 trillion cubic feet.

"We have as much gas per square mile in Bowland as the successful North American shale plays," said Mark Miller, Cuadrilla's chief executive, in an interview. He said the company found nearly four times more gas than it was expecting to discover.

The discovery of such vast resources – 200 trillion cubic feet would be enough to meet U.K. gas demand for 64 years – comes at a time when the U.K.'s conventional gas fields are in steep decline and as it is becoming increasingly dependent on imports such as liquefied natural gas from Qatar and piped gas from Norway.

The exploitation of shale gas has revolutionised American energy markets, helping the US in 2009 to overtake Russia as the world's largest gas producer. Shale now accounts for about 20% of U.S. gas production, and total output is expected to quadruple in coming years. Now the shale boom is beginning to spread to Europe, which also has large reserves of unconventional gas. But opposition from environmentalists has been fierce, and polarising. In June, France became the first country to ban shale-gas exploration. Poland on the other hand is looking to its own shale gas finds to break what its government calls its addiction to coal.




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