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 Special update - Energy and Climate Change Committee report 26/4/12

 

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Week Ending 26th May 2013

UK News

New IoD Report
Undoubtedly the main news of the week will be the new IoD (Institute of Directors) report on shale gas and reaction to it. This was widely trailed last week and the release on Wednesday timed to coincide with the IoD's conference on shale gas in Preston..

The IoD has managed to more than double its previous 2012 estimate of UK jobs. No further information has been forthcoming about gas in place estimates or recoverable gas estimates, so one wonders why this new report is more bullish. There are no facts behind it. Maybe it is no coincidence that it was subsidised by Cuadrilla. Cuadrilla got their moneysworth because the whole report feeds on Cuadrilla's enthusiasm and seeks to promote a shale gas industry with no regard to the environmental and community disbenefits. The only problems the report sees are obstacles eg planning processes, holding the industry back. It is also worth noting the report boosts up the economic argument by suggesting shale gas will trigger an expansion of industry, particularly the chemicals industry, as has been the case in the US.

To pick out a couple of interesting snippets, firstly the report talks about shale providing a third of the UK's gas need at peak demand around 2030. Putting it another way, it would supply 10% of UK annual gas demand over 100 years. Putting it my way, this means there is a mere ten year's supply of gas available there. And by available, we're going by a new estimate of recoverability rate from gas in place GIP of 10%. Cuadrilla have previously bandied around the figure of 25%. I am reliably informed that even 10% is optimistic.

Of interest particularly to the Fylde and West Lance is the suggestion in the reports that a typical pad will be "only" two hectares, and utilise 40 horizontals. Cuadrilla have for the last couple of years said repeatedly that their pads would be no more than a football field, around .7 hectare. They have recently made much play of their scheme to drill stacked horizontals to take advantage of the depth of the Bowland shale. They have implied 3 horizontals per vertical well bore. We are now faced, it seems, with large pads with a dozen or more wellheads, and horizontal drilling at three levels underground for a distance of a mile or more from each wellpad. The report actually mentions as example 10 wells with 40 horizontal but this stretches credulity at 4 stacked horizontals per vertical. Cuadrilla's pretty little picture of a wellpad with trees and birds illustrates 12 wellheads. It will be interesting to ask whether this level of development is capable of delivery by Cuadrilla, who have so far proved incapable of drilling wells without causing well failure (casing deformation and loss of equipment forcing abandonment). As multiple horizontal drilling is pretty unique even by US standards yet again ancashire will be a guinea pig on a worldwide scale. The whole question of fracking causing seismic activity or subsidence needs re-examination in view of Cuadrilla's plans, adding more reason to the argument that this drilling company still wearing nappies should not be allowed to poop on the UK.

The report summary is rather duplicitous in suggestion that a development of 100 pads would occupy only 2sq km of land. In practice clearly if the horizontals extended for a kilometer the pads would cover 4sq km of undergoround shale, so the real figure would be four hundred sq km. If 2km horizontals then 1600 sq km! Plus roads etc etc. To be fair the report does note that extra land would be required for "gathering stations, compressors and water treatment plants". This, of course, reminds us there is a lot more to the industrial devlopment (and series of planning applications) than just the pretty little wellheads, and this scale of development might require up to 17,000 truck movements a day over local roads.

David Cameron backs shale
At the EU summit David Cameron made it plain to reporters what he thought about encouraging shale gas. He said no regulation should stand in its way. This is very bad news, since shale gas exploration, trial production and eventual full production are clearly on the cards for the UK. And it will all be without protection for the environment and communities.

It is not surprising - Cameron has been packing pro-frackers onto committees and now it is clear he has gas lobbyists working actively in No 10 to progress the industry's interests..

Cuadrilla's Balcombe plans
There seemed disagreement this week about what Cuadrilla are planning for Balcombe, and whether they are drilling for oil or gas.
What Cuadrilla's web site says they will do, which seems quite explicit:
"The drilling work will commence in the summer. Specifically Cuadrilla plans to drill and take samples of the underground rock in a vertical well drilled to approximately 3,000 feet. A possible horizontal leg of 2,500 feet may also be drilled from the vertical well, dependent on the results of sampling in the vertical. Neither the vertical nor the horizontal well will be hydraulically fractured. If oil or gas is discovered, a short flow test will be carried out. It is envisaged that the work will take no more than four months, and the site will be cleared of equipment no later than the end of September this year."

Hampshire and Dorset now realising fracking is coming their way
The local press made play this week with the news that DECC licences had been issued for gas exploration in various parts of Hampshire and Dorset. Unless I am missing something, this is hardly news, as a number of PEDLs covering the areas described by the papers were issued by DECC in the 13th round of licencing dating back to 2008, or were issued even earlier.

Elsewhere

Reports continued to explore Poland's fracking troubles, In the Netherlands there were more warnings that gas exploitation was causing earthquakes, warnings of fracking problems in South Africa, US infrastructure not keeping up with the demands of oil and gas production, and again that the shale gas bubble will soon burst.

More worrying were the continuing reports of the progress of climate change and a warning about the future of water resources.

Any opinions here not quotes from the week's news reports are my own. Alan Tootill

News As It Came In with hyperlinks to original stories

Monday

More evidence emerging of water pollution in Pennsylvania
Pollution because geology "less studied"

Local IOD boss: Lancashire does not have any choice other than to press ahead with controversial ‘fracking’

Climate change: human disaster looms, claims new research
Global Warming may be slowing, but no long-term let-up
Tar sands exploitation would mean game over for climate, warns leading scientist
NY residents face increasing deaths due to summer heat

Dutch earthquakes prompt call for gas extraction reduction
Coalbed methane and fracking 'unregulatable' says toxins expert

Tuesday

Polish Shale Gas Hopes Hit Major Roadblock

"Shale Gas keeps lid on oil prices"

Wednesday

New IoD report: getting Shale Gas Working
Eight page report summary
Main Report

Press Coverage and Comment

FOE: Industry-funded shale gas report paints distorted picture
City AM: It’s time for Britain to embrace the global shale gas bonanza
Telegraph: Shale gas 'could be a new North Sea for Britain’
MEN: Region could become epicentre of new shale gas energy industry
Business Green: UK shale gas projections "wildly optimistic", campaigners say
FT: Shale gas could supply a third of UK needs, says IoD
LDP: Shale gas proposals could boost North West economy, claims report Read more: Liverpool Daily Post Shale gas proposals could boost North West economy, claims report
Business Daily: Government urged to unlock UK shale gas jobs
Commodities Now: New report shows the way for UK shale gas development
Business Desk: Shale gas could create 74,000 jobs
Blackpool Gazette: Report pointing to a shale gas jobs boom
Guardian: Shale gas investments 'could be worth 4bn a year to UK economy'
Institution of Engineering and Technology: Permit regime holding back shale gas development
Proactive Investors: Shale gas could supply ‘half UK’s energy need'

Has Greed Just Ruined Poland’s Shale Gas Industry

Ban Ki-moon: World on course to run out of water

Poland Delays Tax to Prevent More Exits by Shale Gas Explorers

EU summit:
UK Prime Minister David Cameron offered robust support for European exploitation of shale gas, telling journalists: "No regulation must get in the way."

EU summit backs shale gas 'revolution'
EU leaders pursue shale gas dream in Brussels talks

LibDems play gesture politics in Hampshire

Thursday

South African Shale Gas Hits Rough Patch

Cheap shale gas bubble 'will burst within 2-4 years': Expert

US Energy Infrastructure Fails to Keep Pace with Boom

Switch to low-carbon future would save households 1,600

FoE: Shale gas: debunking economic myths

Fracking protest at IoE shale meeting

Friday

No 10’s new energy adviser is a former British Gas lobbyist
David Cameron appoints former gas lobbyist as energy adviser
Earlier background info to the move

Earlier background info to the move

New "Lights will go out" scaremongering
British energy security is in doubt without new generation capacity - but don't scupper renewables

Doubt Deepens Further Over Polish Shale Gas

Greenpeace: IoD's basis for a predicting a shale gas boom is "deeply flawed"

Gas companies granted licences for fracking in Dorset and the New Forest
Licences awarded for fracking in Hampshire
Licences for fracking issued for countryside near Winchester

Another PR cockup by Cuadrilla - Balcombe or Bullshit?

Saturday

Cuadrilla and Balcombe make NY news

More news on Cuadrilla testing.

Hampshire daily Echo continues the fracking licence story

As does Portsmouth "The News": ‘Fracking’ ban bid is thrown out over legal doubts

Sunday


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