UK: NO SHALE GAS
Ministers deny hyping UK potential after BGS says only a fraction of Weald oil reserves is recoverable.
Government hopes that Britain can emulate the US by starting a shale-gas revolution have been knocked back after a long-awaited report unexpectedly concluded there was no potential in fracking for gas in the Weald region of southern England.
Michael Fallon, the energy minister, insisted he was neither "disappointed nor happy" at the findings from the British Geological Survey and denied the government had hyped the potential for extracting shale gas in Britain.
He preferred to focus on more positive BGS findings that there could be 4.4bn barrels of oil in the shale rocks of the area, which stretches from Salisbury to Tunbridge Wells – although in practice recoverable reserves are likely to be a fraction of this.
"Britain needs more homegrown energy," he said. "Shale development will bring jobs and business opportunities. We are keen for shale and geothermal exploration to go ahead while protecting residents through the robust regulation that is in place."
The government has started a 12-week consultation on new legislation that would bypass the law of trespass for underground work that is 300 metres or more below the surface and for voluntary community payments of £20,000 for each lateral well drilled. Environmental campaigners have been using landowners' rights to halt fracking projects.
Fracking for shale gas involves digging, often as deep as a kilometre down, and pumping a mix of water, sand and chemicals into surrounding rock to fracture it and release the gas.
But the BGS conclusion that "there is unlikely to be any shale-gas potential" in the Weald area is a major blow to ministers' wider hopes that shale could be found throughout the country.
A first report from the geological agency last June covering the Bowland-Hodder shales under 11 counties in the north of England estimated there could be 40 trillion cubic metres of gas in the ground.
Enormous excitement has been generated around the potential for creating thousands of jobs and possibly helping to lower soaring gas prices, which have caused widespread anger among consumers. In the US the fracking boom has cut gas prices for consumers by 70% since 2007, but few expect similar results in the UK, where a glut of gas would be easily exported.
Asked whether shale energy had been hyped in Britain, Fallon said: "Not by the government."
The oil industry has known since the second world war about the traditional oil reserves in the Weald area and 13 wells are currently in production.
The use of new technology such as fracking could mean extra volumes, but the BGS said more drilling and testing was needed to "narrow down that [4.4bn barrels] figure". Even then, the amount of shale oil brought to the surface may be only "a few percent" of any recoverable reserves.
The country landowners lobby group, CLA, expressed anger at the latest government proposals, saying they were designed entirely for the frackers and ignored property owners' interests.
Greenpeace argued that the whole shale project was misguided. "Stripping away people's property rights while trying to kick off a Klondike-style shale oil rush in the home counties is a highly toxic policy mix," said Lawrence Carter, the group's UK energy campaigner.
"The Tories have just taken a bruising at the local elections – fracking will only make things worse for Tory MPs in the party's heartlands at next year's vote
"Ministers are sticking two fingers up at the three-quarters of Britain who are against giving frackers a free rein to drill under people's homes. And they're also ignoring UN scientists who have warned we must keep two-thirds of known fossil fuels in the ground if we are to head off catastrophic climate change."
But a business lobby group said the government should not miss out on this opportunity, although it warned that investment in hydrocarbon projects was in short supply.
Dan Lewis, energy policy adviser at the Institute of Directors, said: "It's clear that there are significant reserves of shale gas and oil in the UK, and these new estimates must prompt the government to act quickly to unleash the fracking industry. The only way we will know exactly how much gas and oil can be recovered is by allowing more exploration."
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