The shale gas company, INEOS, warned anti-fracking campaigners that attempts to delay its operations would not work.
Speaking in an extended interview with DrillOrDrop, Lynn Calder, commercial director of INEOS Shale, said:
“Our message is: ‘We’re not going anywhere’ … We’re here for the long-term.
“You can delay us and it will annoy us a bit but at the end of the day we’ll still be here doing the obligations that we’ve undertaken to the government, in the most responsible way that we possibly can.”
INEOS Shale, privately-owned by Jim Ratcliffe, holds 1.2m acres of oil and gas exploration licences, about double that of the next largest operator.
The company has applied for planning permission to drill, but not frack, a vertical shale gas well in Derbyshire. Another similar application is expected soon in Rotherham borough. Both schemes have prompted opposition, including a challenge to a government minister over whether the Derbyshire plans need an environmental impact assessment.
Ms Calder said:
“We understand it’s delay, delay, delay – that’s what we see with some of the other operators. I understand it as a tactic but I don’t really want to pay any quarter to it.
“A lot of the delaying tactics are around people having speculation around specific operators which they think don’t have the cash, or they want to sell out because they’re private equity owned, or they’ve got to give a return to their shareholders. We don’t have any of those things.”
Asked whether social licence still mattered to INEOS, Ms Calder said: “It always has and yes it always will”. But she added:
“We’re very clear that we’re not going anywhere. We have a job to do and we believe in it and we believe that we’re doing it for all the right reasons. But on the flip side of that we know that it causes anxiety so it’s very much our job to try and decrease that anxiety.
“But we’re not going anywhere. We intend to discharge our obligations. There will be lots of people who will never believe us. There’ll be lots of people who will never trust us. But we want to be trusted in a way because we’re decent normal human beings who are doing something that we believe in.”
In the interview, conducted on 8 May 2017, Ms Calder also revealed:
- Finding shale gas exploration sites in INEOS’s UK basins is challenging
- Meeting all the company’s work commitments by 2021 is “incredibly optimistic”
- INEOS Shale is still looking for licence areas
- The company is watching direct action protests at other UK sites “with interest”
- It will take legal action to get access to land for seismic surveying or drilling
- Seismic surveying, due to begin within days, will be carried out by INEOS staff and equipment
- The government could help shale gas companies by educating people about energy needs
“Difficult to pinpoint well sites”
INEOS Shale operates 28 exploration and development licences across the East Midlands, Cheshire and Yorkshire.
So far it has published details of two proposed well sites in the East Midlands: Bramleymoor Lane, near the village of Marsh Lane in north east Derbyshire, and Common Road, near Harthill in Rotherham borough.
But by 2021, the company must drill nearly 40 wells in the areas licensed to it last year in order to meet commitments agreed with the Oil and Gas Authority (OGA).
Asked how INEOS was finding other well sites, Ms Calder said:
“It’s really quite a challenge at the moment. And really the only reason that we’ve managed to get a couple of limited areas for potential well sites [in the East Midlands] is because it is a well-known oil and gas and coal region. So there has been some seismic work done, although typically not to the depth that we’re looking at. We still don’t have anything like enough information. But it can give us some general areas of interest and we can marry that with the above surface.”
In the other areas, a lack of seismic data made the choice of sites harder, she said:
“It becomes more difficult in some of our other basins in Cheshire and Yorkshire, where there is less seismic data available so we’re not going to choose sites where we don’t know what the sub-surface looks like.
“At the moment, it’s very difficult for us to pinpoint well sites, certainly in Cheshire, and we’ve got some potential [sites] in Yorkshire. But it’s very patchy.”
Lynn Calder said INEOS would not publicly name other potential drilling sites until the initial stages of the planning process. She would not confirm whether the company was pursuing sites at The Lings and Thieves Wood, identified by Friends of the Earth in the Sherwood Forest area in Nottinghamshire.
Work commitments “incredibly optimistic”
INEOS Shale has agreed with the OGA that it will drill 28 vertical wells and frack another 11 horizontal wells across its licences issued after the 14th round last year.
The work must be completed in just over four years by July 2021. Asked how realistic this was, Lynn Calder said:
“It doesn’t seem very realistic to be quite frank, particularly as it’s a year [since the licences were granted] and we’ve got one planning application in and we know that the planning process is going to be challenging. …
“When you see planning applications taking in excess of three years including judicial reviews, then absolutely it seems like a complete pipe dream to think that we can discharge these obligations in a four year period. Which is why we’re not taking much truck with time-wasting because we really want to say ‘there is a framework in place, there’s a planning system that people can use to air their concerns and we would just really like those to be adhered to’.
“In answer to your question it’s incredibly optimistic that we’ll be able to get through all of those obligations but we will certainly be running as fast as we can.”
Fracking locations: “absolutely no candidates”
INEOS Shale wants to take core samples of shale rock from the proposed sites at Marsh Lane and Harthill. It says this will help decide whether shale gas will be commercially viable and where fracking could be carried out.
The cost of drilling each borehole, known as a coring well, could be in the range £4m-£12m, Lynn Calder said.
DrillOrDrop asked whether, if permission were granted for Marsh Lane, INEOS would seriously invest that level of money and then walk away and not frack. She replied:
“Firstly, no-one’s saying we’re not going to go back and frack this site. We’re not going back to frack this site under this planning application, so we would have to go through a completely different review process. … But what we’re asking right now is purely for exploration purposes.”
Under its licence commitments, INEOS must frack a horizontal well in the licence area which includes Marsh Lane. Asked where this well would be, Ms Calder replied:
“At this point in time we’ve absolutely no candidates for that well and we can say that quite unequivocally because we genuinely don’t. We don’t have any land booked, we don’t have plans to do that.
“Will we be back to that location [Marsh Lane] or any other? We genuinely don’t know and it’s a conversation that I have at length with a lot of the residents because people think that you’re there so you’re always going to be there. For sure, if we find something interesting we will be back.”
She said the location of a fracked well would be decided by seismic data and the core samples. Marsh Lane, she said, was on the edge of where INEOS believes the shale gas play to be. Its results would, she added, help to delineate the play. If Marsh Lane were approved, site clearance could begin in the autumn or winter, with drilling in 2018.
“Drilling rig is not going to be the most welcome sight”
The announcement in January of INEOS’s plans for Marsh Lane led to ongoing opposition and protests. The site is near a school and less than 400m from several homes – INEOS’s self-imposed buffer zone.
Lynn Calder said she sympathised with people concerns about disturbance and said the company had responded by, for example, moving the proposed site entrance.
“I can’t stress enough how much I understand that INEOS turning up with a drilling rig is not going to be the most welcome sight.”
But she said she generally had less sympathy for what she called nationally-organised, professional opposition:
“I’m not talking about everyone, [but] many of them, you can see them move from cause to cause to cause, whereas for the people whose communities we’re entering this is a real cause for them, because this is their lives.”
She described opposition to shale gas on climate change grounds as “naïve”.
“We can move to a decarbonised society, we just can’t do it tomorrow. And what do you do in the meantime? If you don’t have gas, you have to use coal, or you have to stop using.
“My view – so not INEOS’ view – would I rather have coal? No, because it’s dirtier. And do I want to switch everything off tomorrow? Well, no. I absolutely should have the rigour to use less, and to be responsible, and to do things like all responsible people should do for their daily personal use. But I haven’t got the money to convert my house from domestic gas heating tomorrow and I don’t want to be cold.”
“We’re looking to protect our landowners, sites and people”
Ms Calder said INEOS was closely following direct action protests in other parts of the country:
“Obviously we keep a very strong eye on everything that’s going on in Lancashire, and in Yorkshire as well and we are very concerned about what that means for us.”
She said she had “no problem” with peaceful protest. But when people pursued direct action, she said:
“There’s not really very much we can say to them because they’re not people who are going to listen, they’re not people who are going to rationalise and they’re not people we are going to have any form of constructive conversation with.”
She said INEOS expected to share information about protests with other operators. Asked what this information would comprise, she said:
“What works? What doesn’t? What are your biggest concerns? What’s had the biggest impact? Because it really helps us prepare for what we can do. I think we’re absolutely going to be looking at protecting several key things: landowners, our sites and our people. That’s what occupying our thoughts right now.”
Do local people know best?
In the past parliamentary session, Conservative ministers said local people would be consulted about onshore drilling plans. Lynn Calder also agreed that local mineral planning authorities should make decisions on where shale gas sites should be.
“These are local decisions, people have the right to opine, and they have the right to be consulted, they have the right to have their voice heard.”
But asked if local people know what was best for their areas, she replied:
“Yes and no. I understand that they absolutely do know what’s best for the local area in some respects.
“For local people what’s best for their local area is not to have INEOS turn up with a drilling rig, I understand that.”
But she said “there’s a general misconception around the use of the gas” and the physical connection to energy had been lost.
“If you want to use the gas for your everyday life, whether it’s to have your electricity, heating or to manufacturing all the products we’ve become accustomed to, you have to draw on those resources. It’s unfortunate for some people if they live in those local areas but the geology is where the geology is, and there isn’t really anything we can do to change that.”
“We are still looking for licence areas”
INEOS Shale’s owner, Jim Ratcliffe, has said he has invested £600m in developing shale gas in the UK and would invest “many millions more”.
Asked whether the company was looking for more licence areas. Lynn Calder said:
“Yes we are still looking but we have a very high bar. We’re not just going to snap up every licence in the UK.”
She said the company believes there should be other operators, with whom it could exchange ideas and expertise. But she added:
“What we are looking for is the areas which we do think are going to be prospective, areas that we would class as core for our business, and we do want to have the best blocks in those areas.
“We feel that we have got most of those already, but where we don’t or where we see different opportunities come and go, then we will absolutely evaluate them. I wouldn’t say that we are necessarily finished but we’re not on a buying spree, to buy up the whole of the UK.”
Asked where the most desirable licences would be, she said:
“I think it would be if it were very adjacent to something we already had and we thought that that was a really good block. I don’t have a specific example.
“I think the other point is just being a bit reactive, if other operators want to sell something, rather than us skirting around looking.
“There’s an element of any future purchases potentially being more reactive”.
Court action to secure land access
INEOS Shale is preparing to begin seismic surveys across Nottinghamshire, Derbyshire and Rotherham.
Ms Calder said 91% of landowners approached by INEOS had agreed to allow access for surveying.
But the National Trust at Clumber Park publicly refused access to its 3,800 acres and INEOS has removed that area from the current survey programme. Lynn Calder said:
“It’s not something we need to do right now but we will be back.”
She said INEOS had the power to pursue landowners through the courts if they refused access for either surveying or drilling.
“Where there are landowners that are in areas where we need to access, for whatever reason, whether it be seismic or drilling, then I think it is important to note that we do have some powers and, at some point, if we feel that there are areas which we are just not accessing, then we will seek to use those powers. We won’t seek to use them lightly because we’re not about steam-rollering over the countryside.
“We’re trying to do this in the right way. We’re trying to have open conversations with landowners and because INEOS has pledged 6% in revenue sharing we see that there is a real kind of basis for discussion with people.
“But, at the end of the day, if we can’t talk to people or we can’t gain any traction somewhere we need to be as the result of a licence we have been afforded by Her Majesty then we really need to be able to discharge our obligations. So it’s not something we’ll do lightly at Clumber Park or anywhere.
“But we will send a clear message that if people are not willing to talk to us then we will potentially be looking to use the powers that are available to us.”
Seismic surveying: “They won’t hear bangs”
Seismic survey work across the East Midlands is expected to begin within days. DrillOrDrop asked when people could expect to hear bangs.
Ms Calder replied:
“They won’t hear bangs.
“Lots of the areas are accessible by the vibroseis machines. That’s just the vibrator plate going down on to the ground and giving it a bit of a wiggle.
“There will, undoubtedly, be areas that we will need to drill and let off some charges because the vibs [vibroseis machines] can’t get in. Our hope is that most of it will be accessible by them and it will be very, very unintrusive for people.”
INEOS staff were photographed yesterday (see above) laying geophone strings for seismic surveying around Harthill in Rotherham borough. Each string contains maybe a dozen geophones, light-weight seismometers for measuring ground vibrations. The strings are connected to a seismic cable or wireless box. Ms Calder said survey work would cover the East Midlands first and was unlikely to move to other basins until at least the end of the year.
INEOS will be carrying out the seismic survey work itself, Ms Calder said.
“We’re going to be doing a huge amount of seismic surveying and to discharge all of the obligations across three different basins, we are pretty much going to be in constant seismic activity and we wouldn’t rule out actually contracting a second crew, so that we can actually start to accelerate the work programme.
“It is INEOS people that you will see out on the ground undertaking the seismic surveys.”
But the company has contracted Arturius to recruit labourers to work on the seismic survey work. The company said it preferred to appoint ex-servicemen, which led to comments on social media that the project would use former mercenaries.
Ms Calder responded:
“That’s not representative of the situation at all and we’re not going into the seismic survey at all thinking we need a bunch of ex-mercenaries.
“It’s ex-servicemen, it’s people who you want to have jobs and who are reliable and disciplined and well-trained.
“Had we known about this advert going out, we would have worded it slightly differently, but we have since spoken to Arturius, and it was just a sort of misunderstanding more than anything else.”
Recently, the Arturius website has been redesigned.
“No media grandstanding”
Asked what INEOS wanted from a new government, Lynn Calder said
“We want a government obviously that support us because if they’re going to give the licences out and ask for a significant commitment in terms of time and money, then they absolutely have to be supportive. Otherwise it doesn’t work.”
But what she described as “very vociferous support”, as seen during the Cameron government, can work against companies.
“I go to a lot of communities where David Cameron is not the most popular politician.
“I don’t think we need any media grandstanding on it, to be honest. I think the government needs to be a little bit more educational than that. I really think that this loss of physical connection to our energy and how we use it is a real problem to understanding why we are here in these regions.”
She said provided the planning system operated properly, decisions should not be taken by central government, as the Conservative manifesto proposes for large fracking developments. But she said INEOS opposed statutory setback distances, buffer zones and well density limits, such as those included in North Yorkshire’s mineral plan.
“We’re not seeking the most awkward spots”
Lynn Calder said the company would not drill in National Parks, Areas of Outstanding Natural or the Sherwood Forest National Nature Reserve.
Asked if it would frack underneath, from outside, she said:
“I’m not saying that we would never do that. Again, it would all be subject to the planning process, it would all be subject to an Environmental Impact Assessment.”
Asked if INEOS would drill exploratory wells in National Parks, AONBs or Sites of Special Scientific Interest, she replied:
“That’s not our plan, no.
“We’re not going to go after the well sites that are going to make our lives the most difficult. We’re not going to be going after well sites where we believe it’s just morally wrong to drill there.
“We’re going to look at all our potential well sites on a case-by-case basis and do all the appropriate studies. If it’s something we can do safely and without impacting the natural habitat, then we will, but we’re not seeking to find all the most awkward spots and drill them.”
DrillOrDrop has invited opponents of INEOS’s activities to respond to the points in this post.