investigation

Investigation: What happened to the National College of Onshore Oil and Gas?

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Photo: DrillOrDrop

Students looking for a career in the onshore oil and gas industry were expected to enrol in a new national college this month.

But although the college has received an estimated £1.5m in start-up money from government and industry, it is not now expected to open for at least two or three years.

The institution, called the National College of Onshore Oil and Gas or NCOOG, was part of an initiative launched by the government in 2014. Its aim was to develop skills needed for a thriving UK onshore drilling and fracking industry.

It received £750,000 from the then Department of Business, Innovation and Skills, a sum said to be matched by the onshore industry. The government also promised another £5.6m for equipment and facilities.

The four other national colleges announced at the same time have all opened, offering training in high speed rail, nuclear engineering, digital skills and the creative and cultural industries.

But at NCOOG it is hard to find evidence so far of staff, promotion or much course development.

There is no website and, as far as DrillOrDrop can establish, no lecturers, accredited courses or students.

NCOOG is a joint venture company, owned by Blackpool and Fylde College (B&FC) and the industry body UK Onshore Oil and Gas (UKOOG).

DrillOrDrop put a series of detailed questions to B&FC about funding, staffing, and achievements.

We received a short general statement which failed to address most of our questions. When DrillOrDrop put the same set of questions to UKOOG we received no reply.

Mandy Mills, a Fylde resident, has researched the development of NCOOG. She said of the delay:

“The local and national press releases concerning the launch of what the BBC called the ‘fracking college’ excitably talked about commitment to the area and world-class technical and professional training.

“Francis Egan, of Cuadrilla said it ‘would give the North-West a head-start in developing skills’.  UKOOG’s Ken Cronin felt the college would set out ‘the ambition of this industry right from the start to commit to training people in this country’.

“This kind of press attempts to convince those of us that live near a fracking site that there are benefits; that this is a benign industry which wants to look after the community.

“Three years down the line it seems that none of this ‘ambition’ has been realised or was likely to be realised.”

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Cuadrilla’s Preston New Road shale gas site, 25 August 2017. Photo: Ros Wills

What do we know about NCOOG?

DrillOrDrop and Mandy Mills have compiled details about NCOOG from limited public information and responses to Freedom of Information requests.

The story begins in June 2014 when the government called for proposals to establish pioneering colleges that would develop higher level skills for UK industry. B&FC and UKOOG submitted a joint bid.

Successful bid

In November 2014, the government announced that the NCOOG had been successful. Along with the four other national colleges, NCOOG would open in 2016 and would achieve an “outstanding” rating from Ofsted by September 2018.

The government said each college would have a long-term investment plan, governing documents, a refined business plan specifying the curriculum, a governance structure, industry mechanism to provide funds and the definition of a set of standards and qualifications. These documents and strategies were to be developed in 2015.

NCOOG received £750,000 of government development money, to be matched by the oil and gas industry.

A statement from UKOOG said the new college was to have its headquarters at B&FC, which runs the Lancashire Energy HQ. NCOOG would also work with four partner institutions: the University of Chester’s Faculty of Science and Engineering, Highbury College’s Centre of Excellence in Construction and Engineer in Portsmouth; Redcar and Cleveland College’s Teesside Oil and Gas Academy; and the Weir Advanced Research Centre at University of Strathclyde in Glasgow.

At the time, Bev Robinson, Principal and Chief Executive at B&FC, said:

“To be named as the hub of one of the national colleges is a privilege.”

She added:

“This will drive long-term investment in the region, meet the demand for highly skilled labour and secure local jobs.”

She said NCOOG had been supported by “industry-leading organisations” including Centrica Energy and Cuadrilla Resources”.

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Photo: DrillOrDrop

Chair appointed

In January 2015, Colette Cohen, then head of Centrica’s UK oil and gas production business, was appointed the chair of NCOOG.

The announcement said NCOOG was entering a “critical phase”. The then business minister, Matthew Hancock, said of Ms Cohen:

“She has a thoroughly important job training the next generation of onshore oil and gas engineers and specialists who will extract the shale gas from beneath the ground.”

The press release issued at the time also said NCOOG would focus on four areas:

  • Providing specialist skills needed by the industry and training teachers and regulators
  • Accredit courses run by other institutions
  • Carry out research and development to increase efficiency and reduce environmental impacts
  • Work with schools to encourage children to consider careers in industry

The next stage, the press release said, was to develop a business plan and curriculum.

Incorporation and recruitment

NCOOG was incorporated on 30 September 2015, three months after Cuadrilla was refused planning permission by Lancashire County Council to frack at two sites near Blackpool.

The directors included B&FC’s Principal, Bev Robinson, and its Secretary, Paul Howard, along with UKOOG’s chief executive, Ken Cronin. Other directors included: Matt Betts, Vice President of Haliburton; John Blaymires, Chief Operating Officer of IGas; Lee Petts, Managing Director of Remsol Ltd; and Gary Haywood, then Chief Executive of INEOS Upstream. Mr Petts and Mr Haywood have both since resigned from the board.

In January 2016, NCOOG commissioned a recruitment agency to advertise for a managing director. The post was to be home-based, on a salary of £100,000, for appointment in March 2016. Link

By this time, the opening date had slipped to September 2017, according to the application pack.

This said NCOOG would operate through a “hub-and-spoke delivery model”. Courses would be delivered by partner organisations on their campuses across England.

The successful candidate would, among other things, ensure delivery of the NCOOG business plan, provide “strong and inspirational leadership and strategic direction” and oversee the robust financial management of NCOOG”.

There was no announcement of an appointment. We asked whether anyone had been recruited to the role. There was no response from NCOOG or UKOOG.

More money

In April 2016, the Government confirmed it would give £80 million to the National Colleges to “deliver the workforce of tomorrow”. NCOOG was to receive £5.6m for equipment from the Department of Business and Industrial Strategy.

This would be used to “purchase a full suite of training equipment” to enable NCOOG to “offer world-class technical and professional training and education”.

A month later, UKOOG announced that the government funding would unlock industry equipment donations worth a further £2.25m.

Ms Cohen, NCOOG’s chair, said at the time:

“This funding will allow us to progress quickly with the establishment of the college and open new exciting training and career opportunities to local people.”

To get this far, the government said the colleges had to “pass a detailed examination of their business plans and capital proposals” (link).

A board paper to B&FC said NCOOG submitted its business case on 16 July 2015. We asked to see a copy of the NCOOG business plan. B&FC and UKOOG did not respond to our request.

We also asked whether NCOOG had received the £5.6m in capital money.

The college said:

“No further government funding other than the £750k has been drawn down and the college is currently being funded by the industry.”

This was confirmed by the Department for Education, which is now responsible for the National Colleges.

Alarm bells

In March 2017, NCOOG failed to appear on the Register of Apprenticeship Training Providers. A spokesperson told the education newspaper, FE Week:

“With the industry still developing and its requirements for skills becoming clearer, NCOOG has not yet been launched”.

The spokesperson added:

“The NCOOG will make a formal announcement ahead of its official opening, at this stage it is not expected to be in September.”

Yet at this point, the outlook for the onshore oil and gas industry was more optimistic.

The Communities Secretary had granted permission to Cuadrilla to frack up to four wells in Lancashire and the company had begun site preparation work. Third Energy had permission for a test frack in North Yorkshire and IGas had consent for three shale gas exploration wells in Nottinghamshire. INEOS was beginning the planning process for wells in Derbyshire and Rotherham and oil exploration was also getting underway at several sites in southern England.

But the NCOOG board were apparently not persuaded. And a response from B&FC to a Freedom of Information request suggests that the timetable had been slipping before then.

A B&FC board paper in September 2016 said:

“The level of development within the industry has been slower than anticipated; primarily due to the lack of approvals for planning permissions for exploratory drilling wells. As the Board may be aware, where these have been granted they have been challenged via appeals and through the judicial review process.

“This situation has been further compounded by a low oil price which has resulted in the traditional oil and gas industry making significant reductions in headcount. As a result, industry’s requirement for students to be trained has been delayed until around 2019/2020 (subject to planning approval and successful explorations).”

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Cuadrilla control room. Photo: Dave Thompson

Where are we now?

DrillOrDrop and Mandy Mills tried to find out what NCOOG had achieved and how this compared with the other national colleges.

The National College of Digital Skills launched in September 2016 in Tottenham Hale in London. It has 6th form students and apprentices and is on the Register of Apprentice Training Providers (RoATP).

The National College of High Speed Rail opened this September in Birmingham and Doncaster with a small group of apprentices already employed in the rail sector. It is offering four higher apprenticeship schemes and a certificate in higher education.

The National College of Creative Industries in Purfleet, Essex, is offering 25 courses, while the National college for Nuclear had 24 courses at two hubs near Sellafield and Hinkley Point.

Asked about NCOOG’s achievements, a spokesperson said:

“The National College for Onshore Oil and Gas (NCOOG) was launched in November 2014 with £750k funding matched by industry to produce a business plan, set up the governance of the college and outline initial potential training courses.

“A business plan was produced which resulted in a further £5.6m being granted by government to provide equipment for NCOOG matched in part by industry.

“A board for the NCOOG has been established and initial training course outlines for HSSE [health, safety, security and environment] have been developed.”

The spokesperson added:

“NCOOG is ready to move to the next stage but will do so once the industry is ready to progress.”

Despite this, NCOOG has no website, although it said it would develop one when the industry develops.

We asked about staffing, current funding, the long-term investment plan, future applications to RoATP, skills capability in the industry and oversight of NCOOG. We got no response.

On course development, a spokesperson for one of the partners said:

“University of Chester has started the development of a range of courses on related subjects and which will come into play early in 2018. These include Health & Safety, Project Planning, Legal aspects of OOG, Comparative energy sources and others under discussion.”

And a spokesperson at Redcar and Cleveland told FE Week that NCOOG was busy developing training courses and standards.

But OPITO, the UK national training organisation for oil and gas extraction, has not accredited any courses at NCOOG or B&FC or any of the partner organisations.

An FoI response from B&FC in August 2017 said:

“B&FC is not currently working on any courses to facilitate NCOOG.”

The NCOOG spokesperson said the initial course outlines developed by NCOOG had “led UKOOG to develop its guidance for HSSE training”.

The spokesperson pointed us to a 7-page Training and Induction Guideline, produced by UKOOG in November 2016. This said it aimed to “support operators in ensuring that the onshore oil and gas industry carries out operations to the highest health, safety, security and environmental standards and minimises risks to people and the environment.”

Mandy Mills responded:

“As far as I can tell, this is an induction procedure document for visitors to Cuadrilla’s site at Preston New Road.

“It is for the benefit of the industry and seems to have little to do with training young people in any high-level engineering skills or qualifications.

“Is this really the result of £1.5 million of development money?  What has the board of the National College for Onshore Gas been doing for three years?

“After so much back-slapping and thanks being extended to industry partners and local MPs back in 2014, I’m wondering whether Bev Robinson, of B&FC, still feels it is a ‘privilege to be named as a hub for one of the national colleges’?”

103 replies »

  1. Perhaps Thelads could stop editing out the OIL from on-shore “oil and gas”, and the whole situation may look a bit clearer? Only partially related to on shore gas, and even less so to PNR/Cuadrilla.

    I am not of the same mind as Sherwulfe. I suspect if the College does go ahead it should initially focus upon retraining (if required) some of the redundant off shore workers. Probably a much greater opportunity there, as the majority of their training and experience would already have been achieved. Seems logical, but that probably means it will not happen!

    • Unfortunately the semantics are exactly the point.
      On its launch this college was wholly spun as a ‘fracking’ college. Whether this is correct or incorrect is irrelevant. This is what happens when PR companies spin things for the benefit of the industry and it becomes the perceived reality. Please see BBC news reporting and you will see it is referred to this time and time again. The emphasis by the industry, government and UKOOG was on the benefits that this college would bring to the onshore gas industry. There are statements after statements to this effect. Cuadrilla supported the bid of the National College and contributed to the industry matched funding. They made many statements at its launch so they are ENTIRELY related to this issue. Given that Cuadrilla’s activities centre on PNR then this is entirely relevant again and is not merely coincidental that a ‘fracking college’ (BBC’s words not mine) was to be sited 2 miles down the road.
      Secondly the govt funding was part of an initiative to train the young people of the country in high level skills and qualifications up to level 5. It was to give young students opportunities leaving school. This is the basis on which £1.5 million was to be used by the National College-the criteria were definitive. It was not, in the first instance, a college to retrain ‘redundant off-shore workers’. You need to read the government outline and then you can see what a tale was spun and how it has unravelled.

    • So, the real focus on ‘where has the money gone’ seems to have disappeared like the cash?
      If you want to train young engineers for the future we should be training our young people in the clean energy technologies.

      • Sherwulf

        I think we are training The young engineers. Clean energy technology is well supported by mechanical, electrical, civil and material engineers. Apprenticships are available in the sector via Siemens for example.

        In addition the offshore wind sector has picked up quite a few of the ex O&G offshore staff for operations off the East Coast. Their expertise in maintaining plant offshore, helicopter and boat access and so on has helped.

        Siemens, who are a major player in gas power station design erection and ongoing operations support, are a company whose technical and engineering expertise is as useful in gas turbine development as it is in wind power development.

        The size of the offshore / onshore wind industry, and its continuing expansion are the key to the availability of training and in attracting UK and global engineering experience to the industry, no doubt.

        We may be a bit short on Solar panel production but fitting them, or covering fields in them is easy enough.

        As noted in past posts, the next challenge will be the large amount of civil, electrical and electronic engineering required to move to a low carbon transport system, and the vast amounts of cash required to do it.

      • The Office for National Statistics state

        In 2015 there was 234,000 people employed in the UK low carbon and renewable energy sector.

        In 2015 the industry had a turnover of £43.1 billion.

        https://www.ons.gov.uk/economy/environmentalaccounts/bulletins/finalestimates/2015results

        Offshore wind is plummeting in price. Investment in this industry is rapidly increasing.

        Best sited onshore wind is the cheapest form of UK energy and the Government will be under pressure to rethink their policies.

        Solar and battery storage is to get support from the Government as the price tumbles and technology is advancing at a fast pace.

        North sea gas is far cheaper to produce than UK shale. Any oil and gas price increase will see North sea increase output.

        Any young engineers wishing to train in the UK energy sector or those wishing to change careers would be wise to choose renewable energy as that is where the future security lies for UK energy.

          • Tax payers paying billions in fossil fuel subsidies

            http://www.independent.co.uk/environment/fossil-fuel-firms-billion-pound-uk-state-subsidies-oil-gas-firms-leak-climate-change-environment-a7690966.html

            Knowing that onshore wind is the cheapest UK energy and today’s announcement how cheap offshore wind is becoming it appears dirty fossil fuel companies are squeezing the UK tax payer unnecessarily.

            http://www.bbc.co.uk/news/uk-scotland-scotland-business-41226164

            We will still need our mighty North sea oil and gas industry to support the inevitable massive UK renewable energy which is well on it’s way.

            Bye Bye non starter UK shale. Cheerio.

            .

            • John Powney
              As a tax payer, I have yet to pay billions in subsidies for support to business overseas.
              It’s a good breathless headline for the indie, but the gov are guaranteeing loans. What I do not see in the report is how much it actually costs us over the years, and that figure laid alongside the total cost of support to UK PLC by the taxpayer, that tax payer being us and business.

              Why gov support to any company exporting from the UK would be deemed as ‘squeezing the UK tax payer unnecessarily’ is a mystery to me. If it was dirty biomass would that be OK?

            • The fossil fuel subsidies to which you reference, John, have you taken the time to account for the amount of subsidy per unit of energy generated in comparison with renewable subsidies? Have you taken into account that large portions of the fossil fuel subsidies are happening in non-industrialized parts of the world where subsidies are needed to encourage investment? Are you taking into account that many of those subsidies are consumer subsidies and do not go to producers?

              If onshore wind were truly the cheapest form of energy, then it should need no subsidy at all, John. It should be taking share hand over fist without any government help at all. Why do you and other Greens cry big crocodile tears when subsidy levels are cut if the energy is so cost competitive? Does your “cheapest UK energy” claim take into account the fact that wind requires massive amounts of expensive backup power? No, it doesn’t! But don’t worry about the facts, John, your side doesn’t have much use for them!

            • Sure, John, the cost of back up to renewables is “modest” if you assume, as your report did, that penetration rates of renewables merely doubles. The problem is that as renewables take more share, the cost of back up becomes much higher. If you go to a 100% renewables scenario, you need to create 300% plus overcapacity in generation to compensate for intermittency, and even that won’t help you when you experience three weeks of very little wind and sun. These are just facts, my good man. You can’t be cost competitive when you need to overbuild to these extremes. Mathematically it won’t work.

  2. Thelads-if you believe anything the BBC state regarding oil and gas, good luck! (If you do a little research, you will find they are often wrong, and largely, uninformed.)

    Of course it was not a college to retrain off-shore workers. You need to look at the dates. When this college was first proposed there was not a knowledge that there would be large numbers of off shore workers made redundant. Unfortunately, that then developed-due to the success of the shale industry in USA. Any industry and government funding training would only rightly pause and re-examine their plans under such circumstances-one has share holders to satisfy, the other tax payers that money is being paid out for a project that is required and necessary. Young people with training up to level 5 is great, but, rightly or wrongly, will struggle in a market swamped with experienced people trained to much higher levels.

    This sort of thing happens all the time. I will be interested to see where it goes from here, but I see nothing of a conspiracy or anything unusual. Circumstances change so plans get frozen or changed.

  3. Nice study, but unfortunately it skirts around the Elephant in the room, which is the decimation of the UK oil industry by the price crash. It used to employ around 440,000 and the current estimate is just over 300,000. Many of those who left have retired, but it still leaves in the region of 75,000 experienced, trained professionals who already carry the Safety Passport & appropriate certification, who are immediately available.

    In that respect, there is no point in putting more time, money and effort into the NCOOG until things start picking back up. I imagine it’s been effectively put into hibernation until then.

    BTW, by ‘things picking back up’, I mean the oil industry in general. It’s still too early to tell what – if any – shape the UK shale industry will take. Anyone who definitively states that the UK Shale Industry will or will not be economic is jumping the gun.

    The objective of the current round of planned shale Wells is not to find if the Oil or Gas is there – we already know it is.

    It will be to try and establish the most cost effective way to produce the gas or oil, e.g. length of horizontal, number of Fracs, size of Fracs, chemical composition of Fracs etc – which may well be different in each of the main UK shale provinces.

    From that data, the optimal number of Wells per pad and spacing between pads can be worked out.

    Then, and only then, will there be enough data to establish whether or not it will be economic in the UK.

    Mandy is incorrect, the document referenced isn’t a site induction for visitors – which is actually specifically mentioned in the second line in the first table. This table provides guidance as to what the various categories of personnel visiting a location should have in the way of HSSE training and site inductions before they can be allowed on location.

    Before you can work on an oilfield installation in the UK, you need to have undergone a pretty comprehensive training program in HSSE and obtained various certificates.

    The remainder of the document provides guidance as to what the Operator can expect the various workers to have, who provides it and who is responsible for monitoring / recording what training each individual has. It basically aligns the Onshore training system with that used Offshore the UK, so that it is easier for Offshore trained people to work on an Onshore installation.

    • Interesting point Injuneer, but the ‘Elephant in the room, which is the decimation of the UK oil industry’ was caused by a greedy chancellor followed by a reduction in world demand, hence the gluts and price tumble.

      As those countries signed up to the Paris Climate Agreement are now putting in place their climate change action plans, who knows, the price may tumble even further? This is the inevitability of a fossilized industry. The oil and gas giants worked on a model that prices would always increase as demand outstripped supply, particularly as reserves depleted. But the problem now is we have more than enough reserves to crash the planet’s ecosystems.

      The price of clean energy production is reducing. No one want to invest in new reserves or huge gas plants. Despite all the problems with shale extraction and its potentially devastating effects on the UK’s person saturated landscape, it is unlikely that money will remain available when the quotas are discussed behind closed doors. We have enough UK conventional oil and gas reserves for decades to come; the world has more than enough. Time to get sensible.

      • Sherwulfe
        On the point of oil and gas giants working on a model that prices always increase. I worked for one of the giants and that was not the case. The model tried to anticipate future oil prices ( let’s stick with oil at present ) and set the cost of new developments accordingly. Hence, after the 2001 price drop it was expected that a new development would come in at $12-$14 bbl. There was no expectation that prices would always rise. There was always a discussion around peak oil, but as that was, like nuclear fusion, going to happen later, the company knew that developing expensive oil meant you just got taken over when the price dropped.

        Of course, when it rises, if you are too miserly you miss out out. Rising oil prices also lead to price inflation in the supply chain and host country tax take. It is the oil companies who can manage the price fluctuation that succeed. Any who modelled ever increasing prices has long gone.

        This is not the same for countries of course as the case of Venezuela shows. Any country that needs $100bbl oil is in trouble as cutting costs leads to riots rather than redundancy.

        On the point of gas field investment, I am not so sure here either, as those countries you note may move from coal to gas first, and, as shown in recent ( if not arguable ) IMF figures, coal is still far dirtier than gas in the corridors of power.

        • hewes62. In a model I assume you mean prediction. These will be based on operating costs (current), new technologies and availability of staff at affordable rates? However, it is still a guess and based on anticipated demand for the product? Hence the break even point. Otherwise you would be suggesting a go ahead anyway scheme that would leave investors without returns and banks turning to governments to bale them out…

          Where you refer to the historical price drop in 2001, I’m sure it was not predicted that the contribution to climate change by fossil fuel burn was going to be taken increasingly seriously, diverting resources into clean energy by agreement and substantially reducing demand. Long term contracts will clearly buffer this transition, but those behind the scenes are already putting in place changes not expected by the big giants. I have taken into account the cutting costs exercises put forward on here many times by pro-frackers, but inevitably the supply will continue to outstrip demand causing losses.

          Climate change itself will ironically reduce demand further as the planet’s temperatures increase, particularly in developed countries in the Northern hemisphere; the demand for heating fuel will decrease over time. Couple that with the new technologies such as solar roofs and house batteries that will enable the UK homes to be linked as a huge generator and storage facility, negating the need for separate fossil fuel storage and generation facilities.

          Its a question of common sense and dealing with the changes; not all can do this so hence the slow rotation. This however is picking up momentum and surprisingly quicker than I anticipated. A positive at last.

          p.s there are those who believe shale gas to be worse that coal burn….but that’s not in my remit.

          Now back to where is that taxpayers £750, 000?

          • Sherwulf
            The key point was, thay did not assume that the price of oil would always increase as demand outstripped supply. Demand fluctuates and supply was mainly in the hands of countries with large reserves.

            • Neither it appears did they (plural) assume that supply would outstrip demand causing a downward spiral. Hence the huge drop in price; I bet they did not equate that into their model?

              I expect that the board members on looking at historic data would have assumed a rise in price as developing country’s increased assumed demand. It would be a bad model not to assume such rises based on supply and demand economics; maybe they were saving the big “wha hoo” for the ‘bigger than anticipated profit’ at the shareholders meeting?

              Sanctions on certain countries and cartel control have an impact on fixing and indeed raising the price, otherwise, as you have cited, countries like Venezuela would not have sold their souls to the banks to develop their expensive oil reserves; with the help of the big giants of course…

              Still looking for that £750,000 – can you all check your sheds?

            • Sherwulf
              Just that, in my experience, there was no assumptions that supply would outstrip demand in the long term, although no doubt people hoped that would be the case. In the UK the industry hunkered down for a long period of low prices ( via CRINE. Cost Reduction in the New Era ). They also went looking for other things to do, be it expanding gas production, solar panel production and so on. But then the oil price went up, beyond anything I remember us thinking.

              There were various articles in the press at the time forecasting the oil price would drop to $3bbl, which was the cost of production with a small profit for Middle East countries. Huh!

              For Venezuela, more local mismanagement via nationalisation of the industry and political corruption, with an over reliance on oil, not for the first time in their history.

              I have had a look in my shed, but there was no sign of a cash windfall.

      • Hi Sherwulfe.

        The economy crash in 2008 did cause a small reduction in the consumption of oil, but it amounted to less than 1.7 Million BOPD in total and lasted less than 2 years. Consumption was back above pre-crash levels by 2010 and continues to increase. The consensus in the industry is that oil consumption will continue to increase until around 203 and only then start to fall.

        Various Chancellors have tried their best to kill off the UK oil industry by over-taxing. The most effective were Labour in the 1970’s, whose tax rates of up to 98% almost killed the industry before it started.

        In that respect, Chancellors of all hues have learnt their lesson and their actions (including Osborne) have had minimal effect since then.

        The real damage was done when the Saudi’s opened up the taps to keep market share, punish the Russians for their involvement in Syria and to try and kill off the booming US Shale industry. They were partially successful in all three counts, but the main collateral damage was to hurt high cost production areas – of which the North Sea is a prime example.

        The long term goals of the Paris Climate Agreement will help reduce the consumption of oil. However, the use of oil is so pervasive in our society and there are several Billion people in less-developed Countries who aspire to Western standards of living, it will be a long term effort.

        In that respect, I feel we need ‘big picture’ answers, and I personally don’t believe that the current charge towards hybrid vehicles charged from the grid is an effective answer – purely because it does not translate to the majority of the world where they can’t even keep the lights on.

        Personally, using hydrogen fuel cells in vehicles is the answer. The technology is scale-able up for large long distance lorries, the design life of the fuel cell is around 20 – 25 years and the refueling process is like filling up an ordinary petrol or diesel vehicle. Marry that technology with ‘on the spot’ hydrogen generating units (essentially containerised) continuously generating Hydrogen and liquefying it for storage (powered by solar / wind / mains electricity) and you have a fuel system that can easily be transferred to the third world. Not just for vehicles either, the Hydrogen can be used for the village generator etc.

        As for investing in new reserves or LNG / LPG plants, this continues at a substantial pace, particularly with new projects off East Africa and Australia / South East Asia as the majors refocus their efforts more towards gas production.

        As for our reserves, we are struggling to keep oil production above 1 Million BOPD – we have been a net oil importer for over 10 years, ans our imports will continue to rise. Similarly for gas, we have been a net importer for over 5 years and our forecast gas production is set to fall precipitously so that we will be importing over 75% of our gas within 10 years.

        Could we continue to import? Absolutely, but at a devastating cost to our balance of payments (you think your fuel bill is expensive now? Just wait!) and giving up our energy security to other Countries – some of which (e.g. Russia and the Middle East) are not reliable. We could import more gas from the US, but it would be Shale Gas and in that respect, I would prefer to see Shale Gas produced in the UK ( if it is economic – that’s yet to be established) which has much higher HSE standards than the US, and employing a UK workforce to do so.

        • Hi Injuneer. I get what you are saying, but this stuff is old. India and China are not only two of the biggest developing countries but also two main players in the charge towards clean energy.

          You forget to mention that the reason we are net importers is that we sell some of our oil for a higher price than we buy in, so the net effect is profit to the govt coffers. We trade with those oil countries that we buy from, selling them weapons and aircraft amongst other things; very important for the second biggest arms producers in the world (shame on us).

          Our fuel bills are only expensive because of price fixing by the big companies. And the main reason I suspect the Saudi are flogging their oil cheap is because they too have realised clean energy is the future and are investing heavily with the monies raised form the glut into renewables; a quick get it out of the ground and sell it before it becomes worthless…

          • Hi Sherwulfe,

            Yes, China is making large strides in renewables – a benefit of being a centrally planned economy and having a practical monopoly on the rare earth minerals needed in the manufacture of solar panels and wind turbines. I understand the great majority of solar panels installed in the UK are manufactured in China?

            India is starting on the road, but all renewables (i.e. including bio-mass and hydro) account for just 2% of their power production. In the meantime, large swathes of Africa, the Middle East and South-East Asia lack power, and the money to invest in any infrastructure, never mind renewables.

            I’m afraid your second paragraph makes no sense at all. We currently produce c. 950,000 BOPD and consume c. 1,555,000 BOPD, so we are net consumers of oil.

            We only get about one third of our oil imports from OPEC (not just the Middle East). About half of it comes from Norway and about 10% from Russia.

            BTW, all the above figures are from the UK ONS.

            In reality, the prices we pay for gas & electricity prices are fixed by the UK Regulator. The UK Politicians love to make big pronouncements about price fixing to get the banner headlines in the tabloid press, and announce yet another investigation into the industry – which is later quietly buried as it inevitably shows just who is responsible. BTW, the profit margin of the major energy companies currently runs at a derisory 3%.

            As for Saudi, they had a change around in the Royal Family a couple of years ago (when the change in succession to the throne was announced). The Prince put in charge of the economy is a forward thinker who realised how dependent Saudi is on income from oil, and recognises that world oil consumption is forecast to start to decline around 2030. He has embarked on a program to diversify the entire Saudi economy, using Dubai as a model.

            • ‘I’m afraid your second paragraph makes no sense at all. We currently produce c. 950,000 BOPD and consume c. 1,555,000 BOPD, so we are net consumers of oil.’
              It’s not just about the volume, it’s about the spider’s web of trade and prices. We buy oil they buy our goods and services. We sell at a price, we buy in at a lower price. Does that help clarify?

  4. I love the way Sherwulf tries to make every argument for the drop in oil price, but still manages to avoid the reality! It is SHALE OIL production in the USA!
    OPEC (read cartel) has tried to manage the output of oil to hold the price, but when the world’s largest user becomes self sufficient, and shortly a major exporter, and they sit outside of OPEC there is only one way for oil prices to go-DOWN. Some of the N. Sea assets will still be able to make a profit, but it has reduced exploration to new assets as they are not the low hung fruits. This is repeated around the world.

    All the froth of increases in some alternatives, is just that. Very good as a comfort blanket to the antis, but with the world economy still driven by oil, not of major consideration to the wider world-especially as they fill their vehicles at the fuel stations, or run their generators in the developing world. Afraid the world is what it is, rather than what it could be.

    Back to the £750k. I suspect some initial investment may have been made, or not, and then the whole project frozen until it is seen whether on shore assets can be delivered at production costs that make sense within the new economics. Anyone who has ever been involved in developing long term projects knows, from experience, if economics change, this is what will happen. Galling if you have spent a couple of years getting a project planned and ready to go, but that is the reality.

    Anyway, has kept us all involved whilst awaiting for real developments. Maybe, that will change this week?

  5. Hi Injuneer:
    I also think hydrogen is going to be the more likely solution. I have my new Hybrid, and it is nice, but only under a short term lease as I think hydrogen is not far off. Whilst there are many ways to produce the stuff, I expect, certainly in the short term, it will come via “nasty” fossil fuels, leaving carbon for conversion to many usages. That way, the $trillions locked up in oil and gas will continue as assets to drive (excuse the pun) the development forward. (Commerce is much better than governments to develop such things.)
    I have no idea of costs to produce hydrogen from oil/gas but there must be increasing opportunities with USA driving down the prices. Certainly, trials are planned for household conversion to hydrogen, and that hydrogen will come from gas, and the existing gas infrastructure could be used. I noted a recent joint letter from Oxford and Cambridge Universities saying much the same thing.

    We already have gas as a clean alternative to coal. I suspect that could easily move on to gas being converted to hydrogen to make it an even better alternative.

    • Hi Martin,

      Actually, the Hydrogen would essentially be produced by electrolysis. Condense water vapour from the air, use electrolysis to split it into Hydrogen and Oxygen. Then cryogenically freeze the Hydrogen for fuel and let the Oxygen back into the atmosphere (unless you also have a need for liquid Oxygen). Then it’s a case of how you power the process.

      The UK Govt, Shell and one of the Japanese car Companies (I forget which) are working to develop a containerised Hydrogen generation system which can be powered by Solar / Wind / mains to generate and store Hydrogen on site. So, for example, if (hopefully when) Hydrogen powered cars become more common, just drop one in place on the current petrol station forecourt and away you go.

          • Thanks!

            I saw a hydrogen fuel cell vehicle at the New Scientist Live exhibition last year. What I found interesting was that the design life for the fuel cell was the same as the rest of the car (around 20 years). So unlike current Li batteries, it didn’t loose efficiency and require changing out after a few years.

            I tried to find an investment fund that specialised in investing in hydrogen fuel cell technology, but couldn’t. 😦

            • I like the idea of the hydrogen fuel cell. Importantly it sits well with wind generation. And a great waste product H2O.

              But this is not new technology as you say. Fuel cells have been available in the US and China for a while, the only prohibitives were initial outlay and a regular supply of and safe storage of hydrogen.

              The reality is less consumption and a getting rid of this ‘right; to power attitude. We can all say ‘hey, change to electric car or hydrogen powered cars’, but do you know the cost to the planet to currently produce a new car is far in excess of the negative effect by the petrol it consumes in it’s life time?

              As for the other countries you mentioned, the reality is you need the dreaded money and a stable government to develop a country. Only then will there be a possible ‘demand’ for energy and gadgets. It seems though, that some of those who have seen the west prefer to travel here en mass instead of sorting out their own economies. A pause for thought.

            • Interesting Sherwulfe.

              If you look rationally at how much time a car spends doing nothing, it’s an extraordinary waste of materials and money.

              I don’t think legislation will work – any Government that tried to ban cars or mandate we use a particular type will loose the next election. And they don’t necessarily get it right either. It’s not that long since HM Govt was encouraging us to buy Diesel cars instead of Petrol, and we all know how that worked out!

              However, the change over may be naturally happening already. I’ve read in several articles that the % of the 20-somethings who own cars or have a driving license (especially in large western cities) is steadily falling.

              At the same time, you have the rise of Companies like Uber, which more and more people are becoming comfortable with the concept of using. While Uber is loosing a boat-load of money, I’ve also read speculation that their actual ultimate aim is to switch over completely to driverless vehicles.

              So in the long term, it could be that behavior will naturally change to the concept (which has also been speculated about) of never actually owning a car, but calling up a driverless vehicle when you need one.

              In that respect, I don’t ever expect to have to give up my driving licence. When I get that decrepit and need transport, I expect to wave my arm with the embedded RFID chip in the air and have the nearest driverless vehicle pull up and take me where I need to go.

              I’ve long wondered what the true environmental cost of the production of a car is (is there a link you can provide please?).

              In particular, will a complete life cycle accounting of the materials and energy show it really is effective to swap out a reasonably new petrol / diesel car for a hybrid?

              Or because that commitment in materials and energy has already been made, is it better to offer all owners of vehicles over, say, 15 years old a free new Hybrid and scrap the old car?

              And would it be the right kind of Hybrid? The manufacturers all appear to be heading in the same direction, like a thundering herd of Wildebeest. But what if the thundering herd is actually a herd of Lemmings heading in the wrong direction?

              Your last point is also valid – having just a ‘First World’ solution isn’t good enough. We need solutions for those in less developed Countries who aspire to the Western lifestyle.

              However, numerous refugees who travel to the West are actually powerless to change their own economies. In many of them, the level of corruption in the top levels Government (even nominally ‘stable’ Governments) is so extraordinarily high (I’ve seen it first hand – truly staggering), it sucks a substantial amount of the GDP away into various private bank accounts and investments elsewhere.

              Efforts by the West (especially legislation passed by the US and UK) to try and change this behavior are working, but at the moment it means that China (and some other Countries) without similar legislation are just stepping into the breech and international pressure needs to be put on them to introduce it themselves.

            • ‘In many of them, the level of corruption in the top levels Government (even nominally ‘stable’ Governments) is so extraordinarily high (I’ve seen it first hand – truly staggering), it sucks a substantial amount of the GDP away into various private bank accounts and investments elsewhere.’

              With the latest ‘Henry Viii’ take over of the Euro laws and the constant changing of those laws pertaining to our civil rights by the Cons; Osbourne’s father in law with his finger in the fracking pie and Lord Brown lobbying the MPs etc – I fear we are heading in the same direction 😦

              While ‘feeding stations’ are placed out of town, particularly in the Midlands and North of England, cars will be seem as a necessity. We should take on some of the practices from London, new local shops opening within walking distance of communities, using a frequent and cost effective public transport system. Oh for the smell of local baked bread…and those cakes. Ironically many of these shop are being opened by other Europeans and the Leave campaigners wants to send them home – shame on you!

              We’ve got to get out of ‘media town’ and start living in reality. People before things; planet before money. The good news is more and more younger people have a social conscience. Maybe change will come and we can all get back to being human again….

      • Hydrogen by itself is too volatile, even in fuel cell form, electrolysis using the right components produces a third gas, that used to be called Browns Gas, after Yull Brown who discovered it, now it is called HHO, which means it has two atoms of hydrogen combined electrically with one atom of oxygen.
        The electrical bond is very strong, much more so than H2O or air, the result is that the gas burns electrically very hot, it can cut through almost any metal in seconds, yet it is harmless to living tissue, it oxygenates and separates out toxins from normal water and can be breathed and used in divers tanks, it contains no nitrogen and will not cause “the bends” for deep dives.
        The problem is that it is implosive, which is how nature works, not explosive like hydrogen, which is how man has forced the elements to work. HHO can be made on the spot at the point of need. With safety blow back valves and what is termed a “bubbler” which is a water trap. You can also dramatically increase the efficiency of a normal petro or diesel engine with a small addition and a device to prevent the electronics from resetting the air/ fuel mix, as it produces mostly water vapour as an exhaust. Clean and efficient, no gas storage, what more could you ask? Re-engineering the carburettor, the electronics, and the air intake and the air breathing system, a car can be made to produce well over 100 miles to the gallon and exhaust gasses reduced to tiny levels, much less than hybrids.
        Combined with natural gas or bio gas it dramatically increases the octane rating, illiminating the need for dangerous additives that increase the octane rating for reprocessed natural gas.
        The problem, is that HHO is potentially implosive, an implosion is stronger than an explosion, though no where near as touchy as pure hydrogen. That is why it needs to be generated at the requirement point, not pumped or compressed or stored.
        The technology is all ready here, and is being developed by individuals across the world, that revolution is very close now, if it is allowed to be of course?
        The point about all this, is that it can be made cheaply, made on the spot, negates the need for extracting vast amounts via processes that are dangerous and carve up the countryside into “no go sacrifice zones” requires no police state to protect private companies, it maximises the efficiency of use at source and energy generation, it gets a top rating on the Paris agreement, it increases efficiency and reduces needless waste.
        So why don’t we do it? Ask Teresa May and her oil and gas masters?

        • We don’t do it as it was thoroughly discredited long ago.

          Think about it. You run a motor to electrolyse the water to produce HHO and it produces more power than it takes to generate the HHO in the first place? Never mind violating the three Laws Thermodynamics, it’s akin to an old fashioned perpetual motor machine.

          https://www.google.com/search?lr=&hl=en&as_qdr=all&q=browns+gas+hoax&sa=X&ved=0ahUKEwjS0qaq4Z3WAhVEYlAKHR3_AVkQ1QIInAEoAA&biw=1536&bih=736

          • That is simply not true injuneer, i am not surprised however that you say that, as it is standard ohandgee policy to attempt to denigrate and falsify anything which threatens the stranglehold they have over hydrocarbon monopolies. Clearly you have been reading the wrong info, look up eagle research.
            HHO has not been discredited at all, you can get HHO units now, they require hardly any power to drive them, the technology is well established but effectively sidelined deliberately by media and big energy producers and car manufacturers. The power required to produce, it is tiny, industrial scale units are possible but unnecessary, the ohandgee industry like to claim such things are fake and have squashed the concept on a regular basis, going back at least 100 years, but inventors all over the world have proved it to be true and production is cheap, and efficient, look it up yourself rather than make snap blanket denials.

            • Hi Phil, I did look into it myself (I followed the links in the Google search). If you follow the links I provided, all reputable organisations who tested it confirmed it doesn’t work.

              As for the Eagle Research site, that reminded me of a good old fashioned snake oil seller.

              But since you think it’s so great, do you have it installed on your car?

            • That demonstrates worrying example of rigid thinking injuneer, i have seen those debunk reports and i know why they are there, really people are so easily diverted by rubbish?

              However……

              I have had one fitted to three cars now since 2005 i think, all fitted professionally, (main dealer wont do it, funny that) ignition adjusted to optimum BTDC, lean efficient burn at the right compression point, and the last check the engineer said the engine was like new, and it saves around 20% on fuel on a long run, fitted with an Efie.

              How sad that you jumped to a conclusion that is totally wrong without any evidence whatsoever? The web site is clunky but so what? George Wiseman doesn’t care to waste money on swishy web designs, he prefers to make the devices and put the information out there.

              There are fake copyists out there, and nearly all of them are deliberate con artists, but why not do your own research and try not to let those steel shutters blank it out? Sometimes you have to do a little hard work, don’t be wowed by flashy web sites, in fact i would advise against anything too flashy, that’s just click bait to draw in the unwary

              [Edited by moderator]

              Have a nice weekend.

          • I like the idea of the machine that sits on your desk and turns for ever due to the effects of gravity. Need to get one of those on my bicycle.

            • Gravity is the second weakest force in the universe, a little like that comment.
              Perhaps that perpetual emotion response can be hooked up to a perpetual nonsense generator? Oh, I see it all ready is……

  6. Oh dear that must signal the end of UK onshore O&G surely? Actually nope, it is simply all due to delays anti frackers have caused the industry on top of a longer than expected weak oil price. The oil price is going to start shooting northwards before 2020[edited by moderator].
    Legal precedents are being set all the time in favor of the industry paving the way fwd for easier exploration. Once Joseph Corre [edited by moderator] and my least favorite Hungarian Mr. ‘Frackman’ lose their legal fight it is game over in terms of any future legal support for the antis.
    Ineos is the largest private company in the UK with profits of a couple of billion, there is no person or even corporation that has anywhere near enough clout or financial resources to take them on and if you think ‘people power’ will somehow prevail then you are deluded as there is no ‘people power’, it is simply a tiny little band of people (same faces in the photos) with too much free time on their hands. Anyone that has any interest in onshore O&G already knows everything they need to know and no matter how many of these events you hold you will not gain any more meaningful numbers of followers.
    I suggest you pack up and go annoy someone else. Looking fwd to first results which will be this year, 2018 will be the end of the antis.

    • Here endeth the sarkly policeical broadcast on behalf of the GottaB Fractually Inaccurate party. Any similarity to persons alive or dead, real or imaginary is purely fictional and accidental and in no way reflects the views or positions of the management.
      Please all rise to sing along with the party anthem, “The Daft Invaders Theme” and follow the bouncing balls on the scream, and when you have stopped laughing, kindly leave your seats in the upright position as you leave and remove your earplugs. Our usherettes will escort you to the exits. Please assist any still contorted with paroxysms of uncontrollable laughter to the door as you do so.
      Thankyou, next week it will be “Carry On Fracking, The Prime Directors Cut” all 2.5 seconds of it.

  7. Sad to see the moderator has decided to omit painful facts. Will hang around here a little longer but once the latest HC and CoA decisions go in our favor the battle has been won and I can pop open the bubbly. Not long to go.

  8. 68 posts around a non event, and a non story.

    Couldn’t sum up the antis lack of anything substantial any better. Well, I suspect the next two weeks will change that. Lot of noise being produced prior to being drowned out. Sensible in one way, but very informative in another.

  9. Hydrogen power – yes – as foreseen by Erasmus Darwin in the 1760s – Charles Darwin’s grandfather and the English ‘Leonardo’ … inventor, scientist, physician, futurologist (although he couldn’t draw).

    • Hi Philip,

      I haven’t forgotten about replying to you. I just got a bit carried away and it now runs to about 5 pages of A4! I’ve sent an e-mail to Ruth and asked her to essentially create a ‘blank’ post, so I can post both your original questions and my replies and let everyone else in on it.

        • It didn’t start out that way, but some of the questions you asked required more than a one line answer to try and fully explain. I’ll think about the concept of a guest post, although I must admit I’m a bit wary about putting my head that far above the parapet!

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