Politics

Estimates of UK shale gas wells “out of date”, says minister

Fracking Week in Parliament

pnr 171226 Ros Wills 5

Cuadrilla’s shale gas well at Preston New Road, near Blackpool, 26 December 2017. Photo: Ros Wills

The Government has disclosed that an estimate of 155 UK shale gas wells by 2025 is now considered to be out of date and there are no new figures.

The estimate was revealed last month by Greenpeace UK’s investigative journalism unit, Unearthed, following a Freedom of Information request (DrillOrDrop report).

Based on a 2016 Cabinet Office report, the estimate was far less ambitious than that developed by the Institute of Directors of 4,000 wells by 2032.

carolinelucas

The latest information from the Government came in an answer to the Green Party MP, Caroline Lucas (right), this week.

Ms Lucas asked about estimates of the number of shale gas wells in 2025 and 2030. She also asked whether those estimates had changed since 2012 and 2015.

The Energy Minister, Claire Perry, replied:

“Based on information provided by industry dating from 2016, BEIS [the Department for Business, Energy and Industrial Strategy] previously estimated in 2017 that there could be around 155 wells by around 2025.

“This figure is now considered to be out of date.

“The Secretary of State has not made any new estimates for the period to 2025 and has not made any estimates for the period to 2030.

“The Secretary of State did not make estimates in 2012 or 2015.”

Update

On 8 March, Caroline Lucas asked a follow up question:

“To ask the Secretary of State for Business, Energy and Industrial Strategy, pursuant to the Answer of 27 February 2018 to Question 128441, Fracking Wells, what the evidential basis is for the statement that the estimate that there could be 155 fracking wells by around 2025 is considered out of date.”

Claire Perry replied for the Business Secretary:

“We consider the estimate to be out-of-date based on progress of the industry to date and the number of sites currently going through planning”

In response to a related question, Claire Perry added:

“The Department of Business, Energy and Industrial Strategy has not made any estimates of the potential effect on employment from the future development of the shale gas industry.”

What will shale gas be worth to the UK?

The Government was also asked about the value of UK shale gas reserves, the technical terms for recoverable hydrocarbons.

Jim CunninghamLabour’s Jim Cunningham (left) asked the Treasury what estimates had been made.

Robert Jenrick MPThe Exchequer Secretary, Robert Jenrick (right), pointed to the most recent Economic and Fiscal Outlook from the Office of Budget Responsibility, which has forecasts of UK oil and gas tax receipts.

This 264-page document has no reference to shale gas, hydraulic fracturing or fracking.

It said it had revised down the forecast for UK oil and gas revenues (not separated between onshore and offshore) by £0.4bn a year, reflecting new methods of calculation, a lower outlook for sterling oil prices and weaker gas prices.

Figures on receipts from UK oil and gas, comprising offshore corporation tax and petroleum revenue tax, ranged from close to zero in 2016-17 and were expected to reach just £0.7bn in 2017-2018.

The report said oil and gas company revenues had risen because of an increase in the oil price and falling capital expenditure. But it added:

“The high level of trading losses accumulated within the industry in recent years means that these can be used to offset future profits. This will be a drag on receipts throughout the forecast period.”

No news on Third Energy’s fracking consent

Ms Lucas also asked about the assessment of financial resilience being carried out on Third Energy before a decision could be made on consent for fracking at its Kirby Misperton site in North Yorkshire.

She asked the Business Secretary:

“What financial benchmarks his Department plans to use to inform its consideration, based on an assessment by the Infrastructure and Projects Authority, of the financial resilience of (a) Third Energy UK Gas Limited and (b) other companies proposing to carry out hydraulic fracturing operations.”

Claire PerryReplying for Greg Clark, Claire Perry said:

“As set out in the Written Ministerial Statement of 25 January 2018, my rt. hon. Friend the Secretary of State has asked the Infrastructure and Projects Authority to assess the financial resilience of Third Energy UK Gas Ltd, including its ability to fund decommissioning costs.

“That process is still ongoing.

“The Department will respond further, as appropriate, in due course.”

Water contamination

Alex SobelLabour’s Alex Sobel asked whether there had been any water contamination as a result of fracking in the Yorkshire and Humber region.

Therese CoffeyThe Environment Minister, Therese Coffey, replied that there had been no high volume hydraulic fracturing in Yorkshire and said none was permitted to take place in the Humber.

Referring to Third Energy’s site at Kirby Misperton, she added:

“The water environment around the Yorkshire site is being monitored which is required to be assessed in accordance with the environmental permit, before, during and after fracking.”

PM quizzed on INEOS land access techniques

May and Amesbury 180228

Also this week, the Prime Minister was asked about attempts by INEOS’s land agent to secure access to land for seismic testing. The Weaver Vale MP, Labour’s Mike Amesbury, said a constituent had been door-stepped by the agent and, despite refusing permission, then received a pre-named contract in the post. DrillOrDrop report


Transcripts

(In date order. Thanks to TheyWorkForYou.com)

Question by Jim Cunningham, Labour, Coventry South

To ask Mr Chancellor of the Exchequer, what estimate his Department has made of the potential future value of shale gas reserves to the public purse; and if he will make a statement.

Reply by Robert Jenrick, The Exchequer Secretary, Conservative, Newark

The independent Office for Budget Responsibility (OBR) produces forecasts for UK oil & gas tax receipts. Its latest Economic and Fiscal Outlook was published on 22 November 2017:

http://obr.uk/efo/economic-fiscal-outlook-november-2017/

The OBR also produces regular reports on wider trends in the economy that may affect tax revenues in the longer term.

Written question, 20 February 2018. Link to transcript

Question by Caroline Lucas Green, Brighton, Pavilion

To ask the Secretary of State for Business, Energy and Industrial Strategy, what financial benchmarks his Department plans to use to inform its consideration, based on an assessment by the Infrastructure and Projects Authority, of the financial resilience of (a) Third Energy UK Gas Limited and (b) other companies proposing to carry out hydraulic fracturing operations.

Reply by Claire Perry, Business Minister, Conservative, Devizes

As set out in the Written Ministerial Statement of 25 January 2018, my rt. hon. Friend the Secretary of State has asked the Infrastructure and Projects Authority to assess the financial resilience of Third Energy UK Gas Ltd, including its ability to fund decommissioning costs. That process is still ongoing. The Department will respond further, as appropriate, in due course.

Written question, 22 February 2018. Link to transcript

Question by Alex Sobel, Labour/Co-operative, Leeds North West

To ask the Secretary of State for Environment, Food and Rural Affairs, what recent assessment has been made of whether there has been any water contamination as a result of fracking in Yorkshire and the Humber.

Reply by Therese Coffey, Environment Minister, Conservative, Suffolk Coastal

There has not yet been any high volume hydraulic fracturing, or ‘fracking’, at the site in Yorkshire, and none is permitted to take place in the Humber. The water environment around the Yorkshire site is being monitored which is required to be assessed in accordance with the environmental permit, before, during and after fracking.

The Secretary of State for Business, Energy and Industrial Strategy made a written statement on 25 January regarding progress on the consent for fracking in Yorkshire.

Written question, 22 February 2018. Link to transcript

Question by Caroline Lucas

To ask the Secretary of State for Business, Energy and Industrial Strategy, what estimate he has made of the number of wells projected to be drilled by the shale gas industry in (a)2025 and (b) 2030; whether those estimates have changed since (i) 2012 and (ii) 2015; and if he will make a statement.

Reply by Claire Perry

Based on information provided by industry dating from 2016, BEIS previously estimated in 2017 that there could be around 155 wells by around 2025. This figure is now considered to be out of date. The Secretary of State has not made any new estimates for the period to 2025 and has not made any estimates for the period to 2030. The Secretary of State did not make estimates in 2012 or 2015.

Written question and answer, 27 February 2018. Link to transcript

Question by Mike Amesbury, Labour, Weaver Vale

Agents from the shale gas company INEOS recently posted a pre-named contract to my constituent Alison Davies, asking her to agree to a geological survey on her farm. Alison had already rejected this request when she was door-stepped a few days earlier. Does the Prime Minister know what it feels like to get an unsolicited letter from a group who will not take no for an answer, and will she join the Welsh and Scottish Governments by saying no to fracking in England?

Reply by Theresa May, Prime Minister, Conservative, Maidenhead

Shale gas extraction could be a very important part of ensuring energy security in this country, and I am sure all the hon. Gentleman’s constituents and the constituents of others represented in this House will want to ensure the Government are doing everything they can to make sure we maintain our energy security and we do not see the lights being turned off.

Prime Minister’s Questions, 28 February 2018. Link to transcript


Updated 11/3/2018 to include related question asked by Caroline Lucas on 8 March 2018

37 replies »

  1. Not when they are out of the room. Then they are in their natural habitat and can practice their hygiene. Just shows the benefit to everyone to get them out of the room.

    • Do you honestly think you (and very few others) are the only ones actively concerned about the UKs energy future? Regarding gas alone it doesn’t take much homework to see that it’s secured at least for 15-20 years without relying on 1/ onshore unconventional development 2/ Russia, 3/ Gulf states or 4/ increasing LNG imports. Meanwhile an alternative energy future (non-fossil) is being engineered in that period – things are accelerating in that direction already – so FF dependency can be spiralling downwards thereafter.

      • Looking at recent contributions on Drill Or drop, If anyone is still under the illusion that social media, including this web site, is not a weaponised social programming platform, watch this Corbett Report:

        ( https://www.youtube.com/watch?v=0dL8vt1n-f8 )

        Worth looking at to see just how the strategy works and what the end game is all about?

        • And if you think that official video and audio manipulation is any more genuine, watch this:

          ( https://www.youtube.com/watch?v=-_PLNeMuqu4 )

          So what can we trust? Ourselves, if we are genuine and true to ourselves and others, and of course those whom we trust and who we know are genuine.

          All else is apparently at least, potentially “fluid”?

  2. Problem is PhilipP what you define as secure. Recent report from Shell contradicts you.

    It has been shown to be pretty insecure during the last few days, and if you look to the reasons (apart from the weather) you will find quite a number of insecurities. I really can’t be bothered to detail those to you because you want to ignore them and excite others they are a mirage. But, just a few for the others to look at-Milford supply issues, Norwegian supply issues, Rough supply issues-there are more.

    Then there is security, at what cost? Why did the gas from Russia to UK get re-routed to USA? Wasn’t that long ago. Others can find the reason.

    Then there is, how does the UK increase it’s industrial contribution above the 10% of GDP figure within a world environment where many other countries are all competing for the same resource? Again, it will come down to price. In many spheres, if you have an energy cost disadvantage, you find you are uncompetitive. Add that to a poor productivity level and it is just about the (Im)perfect Storm.

    Fantasy about what the energy future could be is just that if you are unable to afford to get there. Borrowing to do so won’t cut it. Financial institutions base the cost of that on the security of it being paid back. The UK found that out in the 1970s.

    • Sorry Martin, you underestimate the power of intelligence, to cut through all this PR crap; putting fear into the populous that the gas will run out, sure, no gas, no business, what a load of feculence.

      Numbers bandied around to give the illusion ‘we are in control, don’t worry; trust us’.

      Sorry, all grown up now, anyone who gets suckered by these narratives deserves to take the consequences; meanwhile in the real world…..

  3. Well, who on earth would have guessed that the Greenpeace FOIA data would turn out to be inaccurate and outdated? The massive “victory” of the anti-frack lobby down the tubes. People just don’t seem to be bright enough to understand that if UK shale is economically viable (and the signs do look promising) then there’s no need to worry. Wells will be drilled and a more secure domestic gas supply chain will be built. Fewer GHG emissions will be released, wealth will increase in local communities and nationwide, and the air will continue to improve as coal is phased out.

  4. Well EKT, you obviously hit the mark there, and discovered the new FOE poster, on “Alternative to Energy”!

    The three monkeys, but the antis will only speak it, having first manipulated it. The other two are too inconvenient.

    For the elephants in the room, at least they are being kept warm. They don’t like the frosts, even in Thailand. (Don’t bother with the denial, Giggle it. They are there and frosts occur and yes, it is a problem. But with Arctic and Antarctica being confused natural history may not be a strong suit on this platform, although it is often quoted as a reason to deal with climate change.)

  5. You mean the real world of yesterday where industry were asked to reduce gas usage, and therefore output, so the rest of us would be OK, as long as we paid the industry to reduce it’s usage of gas?
    More alternative than real Sherwulfe. Robbing Peter to pay Paul. Trouble is Peter is reduced in output, pays less taxes on his profits and then Paul is asked for a double whammy to make that up as well. Must be from JCs text book.

    • You really need to get that pet elephant off your knee Martin and take it for a yellow snow walk, it’s restricting the blood to your head……

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