Exploration • Drilling • Field Services
“For example, local communities will receive £100,000 for every exploration well site that is hydraulically fractured in addition to 1% of revenues from future shale gas production. Tis could equate to over £1 billion over a 20 to 30 year production timescale in Cuadrilla’s Bowland Basin licence area alone.”
Impact on carbon emissions Cameron also says that the major selling point – from a business and political point of view – is the example that can be seen in the USA, where the increased use of shale gas has contributed to a significant fall in carbon emissions. And he believes UK politicians are, on the whole, in favour of shale exploration and keen to encourage it. He comments: “For example, a recent report by the cross-party House of Lords Economic Affairs Committee stated the appraisal and development of the UK’s shale gas and oil resources is a national priority. We would like to see ongoing political support to streamline the regulations that companies such as Cuadrilla must follow before commencing exploratory work. Te UK’s regulatory environment for oil and gas exploration and production is highly regarded internationally. However, we agree with the House of Lords Economic Affairs Committee that there is scope for making this system more efficient.” Regardless of this desire to improve the situation in which Cuadrilla operates, Cameron explains that the firm remains extremely active in the shale arena: “We are currently focusing on the Bowland Basin and our license area in Lancashire. In February 2014, we announced our intention to apply for planning permission to drill, hydraulically fracture and test the flow of gas from up to four exploration
wells on two sites – one at Preston New Road and the other at Roseacre Wood. Since then we have been focusing our efforts on community engagement as well as preparing an Environmental Impact Assessment for both sites.” Te Preston New Road planning application has now been submitted and the Roseacre one was due to be submitted at time of press. Despite Cuadrilla’s optimism, the likes of Helge Lund at Statoil remain unconvinced that any real progress will occur, at least not in the short-term. Lund’s spokesman, Morten Eek, suggests that Europe is lagging well behind other markets. “Although the European shale resources are large, the preconditions are not as supportive as in the USA, implying that shale gas development in Europe will take more time and that production costs will be higher.” Eek believes that “the US shale gas revolution [in which Satoil played a key role] is unlikely to be replicated in the same manner in Europe.” He adds: “However, in our opinion,
Europe has a clear incentive to develop indigenous shale resources. It could provide the basis to create jobs and strengthen competitiveness. Also, in a carbon-constrained world, European shale gas can cater for the increased use of natural gas, replacing coal in power generation. In the USA this has contributed to reducing CO2
emissions.”
Eek concludes by agreeing that – as detailed above – it’s not really useful to consider ‘Europe’ as one cohesive market. “We believe that shale gas will be developed in Europe, but also that the development will greatly vary from country to country. Tis is exemplified by the French ban on hydraulic fracturing and the UK and Polish governments’ active support of it.” l
Cuadrilla Reasources is one of the biggest names in the UK shale sector.
www.engineerlive.com 27
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