West Newton-A wellsite, East Yorkshire, 3 May 2019. Photo: DrillOrDrop
An investor in the West Newton wellsite in East Yorkshire has said it could be the UK’s largest onshore gasfield and the largest onshore hydrocarbon discovery since 1973.
Reabold Resources, which has a 24% stake in the exploration licence north of Hull, made the claim in a statement to investors this morning.
It followed preliminary results from the second well drilled at the West Newton-A well site.
According to the statement, the results found “a substantial hydrocarbon accumulation” in a net 65m interval in the main target of the well, the Kirkham Abbey formation.
Reabold, which owns 35% of the site operator, Rathlin Energy, said:
“West Newton is potentially the largest UK onshore gas field and potentially the largest hydrocarbon discovery onshore UK since 1973, subject to further testing.”
The company’s co-chief executive, Sachin Oza, said:
“We are delighted by today’s results confirming that West Newton could potentially be the UK’s largest onshore gas field. The results of the well have exceeded our expectations and have also shown a significant liquid hydrocarbon volume which has increased our excitement and the future value of the field materially.”
Another investor in the site, Union Jack Oil, did not repeat the claim in its statement to shareholders.
Union Jack’s executive chairman, David Bramhill, described the results as “excellent news”. He said:
“The initial results of the West Newton A-2 appraisal well exceed our expectations. The most important aspect of this drilling exercise is that the operation was undertaken in a safe and competent manner by the operator.”
In an interview with Share Talk, Mr Bramhill said the results “opened up a hell of a lot of things that could happen in the future”. He said there were “quite a few mirror images” of the West Newton geology across the PEDL183 licence area, which he said measured 176,000 acres.
He said the latest results had found a cap of gas, with potentially oil or condensate underneath. There were also hydrocarbon shows in the deeper Cadeby formation, the secondary target for the well.
West Newton-A wellsite, East Yorkshire, 5 May 2019. Photo: DrillOrDrop
The West Newton-A-2 well was spudded on 26 April 2019 and reached its total depth of 2061 on 9 June 2019.
According to the statements, the operator extracted a 28m of core from the Kirkham Abbey formation. All planned logging operations have been successfully completed, the statements added.
Production casing has been run in preparation for testing the Kirkham Abbey formation to determine flow rates.
Testing operations are expected to started in the third quarter of this year. Planning permission is in place.
The statement said the results from West Newton A-2 “correlated positively” with the results from the first well drilled at the site.
Rathlin Energy also has planning permission to drill at a nearby well site, called West Newton-B. The statements from both investors said the Cadeby formation would be drilled later from West Newton-B.
- At the time of writing, Reabold Resources share price was up 24% at 1.025p. Union Jack shares were up 26.47% at 0.215p.
Categories: Industry
DRILL OR DROP? 
Good oh
Although, while being a large onshore find, it is only about 10% of the Culzean field which has just started operating in the North Sea.
So … a few wells and pipeline to Dimlington / Easington. Not a lot of infrastructure required.
https://www.offshore-technology.com/projects/culzean-gas-field-north-sea/
Excellent news. Looks like the Council were made aware of the logging results hence the18 months road closure to allow well testing and additional drilling. What’s not to like, onshore conventional gas field? Of course it may be overhyped but the rules are fairly strict on disclosure these days. I doubt the lower oil zone will be commercial as retention of oil in the core usually means low permeability. But the well testing will find out.
John Powney will be happy – home produced gas to replace imports of LNG.
More hype to bait the mug punters?
We have seen this type of information before.
Lord Browne with years of experience
“Enough gas in Lancashire to last Britain for 56 years”
Now says
“Fracking in the UK doesn’t make much sense”
https://www.thetimes.co.uk/article/enough-gas-in-lancashire-to-last-britain-for-56-years-czvp3hh6s0p
https://leftfootforward.org/2019/06/fracking-in-the-uk-doesnt-make-much-sense-says-former-fracking-company-boss/
Talk the talk…….share prices rise
Fail to walk the walk……share prices plummet to virtually nothing.
https://www.google.com/search?q=ajlucas+share+price&oq=ajlucas&aqs=chrome.1.69i57j69i59j0l4.4955j1j7&sourceid=chrome&ie=UTF-8
What is known, whether drilling conventionally, or unconventionally, Rathlin Energy did drill into the Bowland Shale, it was confirmed they were undertaking a mini fall-off test in the Bowland Shale, they did have chemicals on site and they were expecting Naturally
Occurring Radioactive Minerals to be released from well tests.
https://cdn.frack-off.org.uk/wordpress/wp-content/uploads/2016/01/what-went-wrong-raithlin.pdf?x95339
If they need to frack at any time the investors should take a look at how much money has been made to date from fracking…..Nothing.
John Powney
The gas is still there under Lancs, so Lord Brown was correct, and also in that they had to work out if it could be produced.
Hence his thoughts now, as below.
Question …..But you are arguing in the book for fracking. You were chair of fracking company Cuadrilla. Does that make sense?
Answer …….No, fracking in the UK doesn’t make much sense. I think it was a test to see if it worked. We probably don’t need to do it.
So I do not see any conflict in his opinions before or after, although we would have to cough up for his book to see why he argues for fracking elsewhere.
I am often told that we have 200 years of coal under us in the UK, which is true, but we are not going to go and extract it in a hurry.
he also asked
Q…..What would you say to Greta Thunberg?
A….I would say that I have been at this for longer than you’ve been on the planet and that [decarbonisation] will take time. And so my proposal is this: remember that energy is a very big system and there is not one solution. We can’t have one magic bullet that will make the solution work for us. We need to take all the things people are doing [to reduce emissions] because it will be very difficult to persuade them to change. China is opening up brand new coal mines to feed India. What happens in the UK is actually not very important. It’s what happens in places like China, Indonesia and India that will really count. Because we will need coal, oil and gas, we need to do everything we can to decarbonise the emissions. This is critical for the future.
What utter nonsense, if investors believe this, they deserve all the punishment their cash flow will get from the ponzi masters.
And your evidence for that rant, flfs?
You mean those investors who might have sold some holding early today and then been able to substantially increase their holding an hour or two later? Or, alternatively, added to their cash flow by taking a 50% plus profit? Oh, what a nasty punishment.
It must be true-it was on Radio 4. LOL
50% pay out today for the ponzi masters and a 300% loss for what gullible fools there are ledt by this time next week.
“Mug punters” a phrase coined by Fund Managers-ermm like Woodward!!
Even before last weeks evidence there are decent quality reports to indicate the mug punters may be those who rely on Fund Managers who believe they are mugs and will continue to rely on them. Wonder how many of those “experts” have been advising clients to invest in Tesla over the last year or so?
Of course, there are mugs who sell assets they can’t make a decent return on and find the “mugs” who buy them are then identified a while later as UKs wealthiest after making those assets work. Now, who would the mugs be?
Bookies second favourite for PM says,
Britain should not expand fracking because it needs to set an example to the world on cutting emissions, Rory Stewart has said.
The Tory leadership contender distanced himself from mainstream Conservative positions on energy, saying that nuclear was “hugely expensive” and that he would prefer to invest in renewables. He said that he was open to support for onshore wind farms to create “a level playing field when it comes to subsidies for renewable energy projects”.
Looks like Rathlin’s attempts to increase UK emissions could be met with some high level resistance.
https://www.thetimes.co.uk/edition/business/more-fracking-will-set-bad-example-jz89h2ldn
Another one who has continuing problems with reality!
Who elects the PM? Ohh, it is Tory MPs and Tory Members. Shock/horror-it will be Boris and Rory will not even be in the Cabinet. Tilting at windmills will be his thing. “High level resistance”-you mean the back benches?
Looks like someone is away with Alice, John.
Don’t worry Martin – I know Rory quite well and he will not put onshore wind farms back on the agenda. Boris may as he is cluless but Rory will not as most of his constituents do not want them.
Lots more to worry about than that one, Paul. Industrial energy prices 28% more expensive in UK than the average for a western economy, and UK competing outside of the EU.
I am retired. Those at Ford,Bridgend and British Steel may not be given the freedom to make that choice for themselves unless that 28% is adjusted. Others, who expect competitors to volunteer to bring themselves up by 28% may delude themselves, but they will find a heck of a response when the reality hits those who thought they had secure jobs in UK industry. And Labour playing both sides of the fence will not do much better. Shame it will take a lot of damage to hard working peoples lives until they realise that they will be sacrificed for de-industrialisation and that emissions from that industry over the horizon have risen. Too many have already been retrained as men’s hairdressers, and certainly not getting enough tips to replace their previous incomes. All these trees require very little labour either, unless the mechanical stuff is replaced with axes-that would need importing!
Well his constituents are in the minority, as official gov poll states support for onshore wind is at least 76%.
It will also knock an average of £50 off annual energy bills, cheapest form of energy production, cheaper than gas, and fossil fuels looking more and more like polluting, climate changing, volatile stranded assets:
https://www.google.com/amp/s/amp.theguardian.com/environment/2019/jun/12/onshore-wind-farms-in-uk-could-cut-50-a-year-off-energy-bills
Tories need to wake up and fast!
DestroyPNP
The study referred to notes that by investing in onshore wind, household energy bills could be £50 per year cheaper in 2035, than if we did not do that.
https://www.renewableuk.com/news/455727/Research-shows-future-onshore-wind-projects-save-consumers-50-a-year-.htm
So .a saving in 16 years time, maybe.
The saving is based on the tripling of onshore wind capacity and not building any new gas fired power stations.
At present, onshore wind is more expensive than gas and coal on a straight comparison. Once carbon tax is considered gas is cheaper.
To get onshore wind going the industry ask for
1. To be able to bid for subsidies
2. To relax the stringent planning rules
The energy minister thinks that onshore wind is cheap, hence it does not need subsidy.
So … if onshore can have access to subsidy, and some relaxation of planning rules then the industry would be happy.
Hew62, giving onshore wind a level playing field, at least the same the fossil fuel industry has enjoyed, will make it cheaper. Instead of the Tories declaring a climate emergency and then slapping 20% VAT on solar, why don’t they give tax breaks to them? People have had to pay a subsidy to install the national gas network over the last few decades. Why don’t renewables and energy efficiency products, considering it’s a climate emergency? 5% VAT, instead of 20% for retrofitting energy efficiency measures (EEM) would pay for deep retrofit across the UK (as quoted from a local builder involved in it). This, and replacing gas with renewables like air, ground and water heat pumps will give enormous savings to towns and cities. Consumption is reduced and energy generated from free, renewable sources, instead of paying increasing fossil fuel costs to energy companies through everyone’s bills. Even the Tories have said gas boilers will be banned in new homes from 2025, so had better start getting with the programme.
DPNP – have you factored in the increasing price of critical elements needed for wind farms? Also what mechanism are you proposing to store the energy generated by wind to cope with the intermittency of production?
JG, from the article: “Onshore wind is expected to be cheaper than gas-generated electricity because of plummeting turbine technology costs and the rising cost of carbon emissions, according to the report.”
But on the intermittency issue: https://cleantechnica.com/2013/08/12/intermittency-of-wind-and-solar-is-it-only-intermittently-a-problem/
https://www.scientificamerican.com/article/solution-to-renewable-energy-more-renewable-energy/
http://sro.sussex.ac.uk/id/eprint/58168/
So it’s not just wind and solar, it is a wide diversity of sources, for every 1kW a heat pump uses you get 3 to 4.5 kW out (depending on type of heat pump) – these heat pumps can be powered by solar, wind, but also from batteries, EV charging vehicles, hydro, tidal, wave which are regular as clockwork. Plus, if new builds are built to Passivhaus standards then you barely need any space heating at all. Retrofitting old houses to Enerphit standards will significantly reduce heat demand, coupled with the vast array of renewable tech out there.
What’s your long-term proposal for tackling the immediate and increasing costs of accelerating global climate change?
DPNL – I work with several people who wrote the IPCC and CCC reports and they are no where near as optimistic as you. They see a massive issue with supply of critical elements in terms of cost and environmental impact.
I personally think the UK is going an OK job in terms of funding R&D in renewables as well as moving towards a low carbon economy.
To answer your question in terms of what I’d do:-
I would move towards a decentralised energy network in which local wind, solar, geothermal etc were a major part.
I would try and produce local gas to support the intermittent supply.
I’d move from methane to hydrogen in our home central heating but to do this I would push forward with carbon capture and storage to dispose of the CO2 created during methane generation.
I’d encourage people to eat less meat, have less children and try and live close to where they work.
I’d increase nuclear but have the same design for every power station.
I’d obviously keep investing in renewable research.
Now getting onto things that I wouldn’t do – I wouldn’t buy gas off another country when we can produce our own.
DestroyPNP
I am sure wind will continue to become cheaper, but offshore wind still has the advantage that the wind blows longer and stronger out there and turbines can be larger and more efficient.
It seems that the onshore industry want a bite at the available subsidy, and all renewable industries want more subsidy at present. I am sure more subsidy will turn up once parliament gets over leaving the EU issues.
Re increasing VAT to 20% on solar, it seems that this is being watered down a bit, but follows infraction proceedings by the EU in 2015, so good the gov has been dragging its feet on this for so long.. not that doing so had resulted in a high take up rate.
https://www.crowe.com/uk/croweuk/insights/vat-treatment-changes-solar-panels
Plus the cost of the panels has dropped 70% since 2010, despite anti dumping laws keeping prices higher and the wish of the EU to raise VAT.
https://solar-finder.co.uk/news5/?source=taboola&a=210501498&utm_source=taboola&utm_medium=referral
The key issue for me with solar is that people expect it to make money. But we should be fitting it because it is the right thing to do, not because it’s financial viability depends on transient VAT rates. But a subsidy on fitting and a juicy feed in tariff ( getting those without it to pay ) always helps.
H62, this government abolished the Feed In Tariff (FIT) which dramatically reduced solar PV installations in the UK, end of March this year. Then the 20% VAT on solar has seriously set back UK decarbonisation and why we need to have more weight/ input in Europe, cooperating more than ever with our European neighbours on these issues, not less! We need a mixture of democratic, decentralised renewable energy generation on a local level, but also national and international cooperation on smart grid networks https://www.solarpowerportal.co.uk/news/proposed_solar_and_storage_vat_hike_risks_setting_uk_decarbonisation_back_y I would much rather pay subsidies on my bills for renewables/ energy efficiency to mitigate against the worst effects of climate change and reduce energy bills, long-term, (along with the assistance for those in fuel poverty through schemes like the Warm Home Discount, short-term), than subsidise fossil fuels and nuclear, eg. EDF wants UK bill payers to pay more so they can install new nuclear, https://www.bbc.co.uk/news/business-48593581 And we all know nuclear is like a bottomless pit to pour endless quantities of cash into for millenia (if humans have that long now), not to mention the cost of storing increasing quantities of nuclear waste, radioactive for 10s of 1000s of years; what man-made container has ever lasted more than a few thousand? That’s storing up a whole heap of nastiness for any future generations.
JG, I actually agree with much of what you are saying, but I would not open more fossil fuel frontiers to stop fossil-fuel,etc, induced climate change and I think the UK, as well as other rich EU countries, are dragging their feet and could do way more. The priority has to be reducing fossil fuel consumption dramatically through EEM, good planning and design (renewables to compliment). That is a war-like solidarity effort, where rich countries responsible for much of this mess, show leadership, along with international cooperation and global skill sharing, investment and acceleration of installs.
DestroyPNP
Thanks for the reply, and I have read the links.
Re VAT on Solar Panels, as your link notes, HMRC have been dragging their feet over this since 2015. I spoke to the local solar panel fitter and he was cheered by the possibility that we would soon leave the EU, could scrap any VAT increase and bin the EU tariffs on Chinese panels.
Beauty is in the eye of the beholder in Lincolnshire it seems, which, as you probably know, is as keen to be independent of the EU as the SNP is of the rest of the Union.
H62, whilst the VAT wrestling with the EU is true, it shouldn’t be the reason to throw the baby out with the bathwater, though I agree the EU needs to be more democratic, with more devolved local powers and less rampant neoliberal policies applied across the whole of our European continent. However, citizens across the EU are demanding their governments wake up to the crisis and cooperate on reducing fossil fuel consumption and species/ habitat loss. This is something we cannot do on our own and we are in Narnia if we think we can. Doing trade deals with the US is a race to the bottom, reducing environmental, animal welfare, public health, etc standards and workers rights, especially with the current moronic, racist, megalomaniac in charge. What IS in the UK government’s control is reducing the VAT on sustainable materials for building energy efficient homes. They already do this in Belgium, where the VAT is 6% for these purposes, as quoted by a member of the European Regional Development Fund at a tour of the Brighton Waste House, which is built to Passivhaus standard with >85% re-used waste and produces 30% more energy than it consumes. Sadly our government hasn’t budged on this, when it should be the priority. Also our government caused an 80% drop in UK solar PV uptake on abolishing the FIT, when they didn’t have to.
H62, with regard to VAT on solar, this is not a valid reason, in itself, to leave the EU. EU countries like Belgium allow just 6% on sustainable building materials, to encourage low C, energy efficient house building, as confirmed by a delegate form the European Regional Development Fund during a recent tour of the Brighton Waste House (built to Passivhaus standards with >85% reused waste, produces 30% more energy than it consumes). Unfortunately our government and not the EU has decided to keep the VAT at 20%, not really helping with the climate emergency, amongst other policies that undermine the C targets, including abolishing the FIT which has dramatically reduced UK solar uptake. This UK government did that, not the EU. Again Belgium has a complicated array of incentives, including a FIT and some regions have opted for a Green Certificate (GC) Scheme. There are also investment grants, VAT reductions and beneficial credit terms. In addition, private residences (owned for more than 5 years) are only required to pay a 6% VAT instead of the usual 21%. Even so, this country amongst many others needs to do more. EU citizens are demanding their governments wake up to the task, eg. action to stop the EU trashing forests for biofuel; we need cooperation, to make it work and reach common goals, not isolated and ineffective. We definitely do not need a race to the bottom with the US, where animal welfare, environmental standards and workers rights are decimated, not to mention the threat to public health and our NHS. The EU needs to listen more to its citizens, be more democratically accountable and less neoliberal, with more devolved democratic powers to local regions. However, the overarching policies need to be cooperative, concrete actions to tackle the climate crisis and widespread global species and habitat loss, if future generations are going to survive and have some quality of life.
DestroyTPNTP
I would agree with your comprehensive reply. My point was, some see it differently out here in Brexit Country. Engrained opinions are quite difficult to change.
John – could you inform those who don’t know as much about this subject as you how Rathlins discovery is going to increase UKs emissions?
The shale industry in the US is claimed to be the most successful to date and yet Wall Street has closed its doors to the fracking industry and refuses to make further funds available. And reports state that despite reducing costs significantly the US shale industry debt is increasing. According to the WSJ the US fracking industry is now “scrabbling” around for new funding sources but all new funding sources will be more expensive than was available. That does not bode well. If they are still losing money with a mature industry in the US then it is legitimate to question the economics of fracking in the U.K. where environmental and planning legislation is more restrictive and there is strong political and public opposition to the industry.
Wrong page KatT. This is about dolomite:
http://www.bgs.ac.uk/lexicon/lexicon.cfm?pub=ROD
Strange that the rig counts are still holding up in USA then KatT, (accounting for oil price/demand influence.)! Oh, and that many big players who stood on the sidelines have paid a lot of money to join in recently.
Oh, they must all be mug punters!
You can make money AND have debt, KatT. You antis made that mistake regarding INEOS. It seems the lesson has not been taken on board.
Interesting how the comfort blanket of debt and mug punters is always brought out in these circumstances. One could almost believe it is the emergency script awaiting any such news.
https://www.theguardian.com/business/2019/jun/15/climate-crisis-coal-asia-power-generation-fossil-fuels
Not doing too bad for an industry which is losing money and cannot get funding? – the same growth in one year as the previous 12 combined…..
“The demand for gas increased by 5.3% in 2018, one of its strongest growth rates for over 30 years. Its use accounted for 45% of the increase in global energy consumption last year.
The gas “bonanza” was led by the US shale boom, says Dale. The US shale heartlands in the Marcellus, Haynesville and Permian basins produced an extra 78 billion cubic metres of gas last year. This is the same growth in one year as the previous 12 combined.
The surge in US gas production was used mainly to meet its own booming domestic demand. The US recorded the third-highest growth for energy consumption last year: it is the only G7 nation at the top of the energy growth league table; the rest of the top 10 are developing economies.”
Thank you Paul. Perhaps you can be kind enough to explain why Rathlin also targeted the Bowland Shale? Or is that information incorrect? Are they targeting many different types of geology during exploration but only intend to extract from conventional? I am genuinely interested.
With regard to fracking it seems whether demand or production is up or operational costs down, the US fracking industry is still increasing debt and traditional investors are getting cold feet.
https://www.wsj.com/articles/frackers-scrounge-for-cash-as-wall-street-closes-doors-11559915320
https://www.wsj.com/articles/frackers-face-harsh-reality-as-wall-street-backs-away-11551009601
Perhaps investors are getting cold feet in the US – but the companies are getting their money from somewhere. You don’t get an annual growth equal to the previous 12 years combined without spending money.
Rathlin had to drill through the Bowland Shale to get to the Carboniferous in the first well. Not sure how deep they drilled this one to. The final depth of the well is dictated by OGA / BGS who want as much information as possible. It is also probably a licence obligation. The Carboniferous is a regional producing formation. It is common sense to check out a potential formation you have spent millions to get to, particularly as your total depth commitment is below it?
The primary targets was the Kirkham Abbey Formation (gas) with a secondary target of the Cadeby formation in which they found some oil.
As far as I can see the Bowland Shale is not a target other than they may do an injectivity test although this test looks to be in a deeper lithology (JP has alluded to this via a very odd report written by who knows??) and will have collected geological samples while drilling it as required by the OGS / BGS for all formations drilled. But I think this may have been the first well. No doubt JP will enlighten us.
Someone on this BB will have a better idea of what went on, where they drilled to from a lithology standpoint etc.
Paul, the West Newton A-2 well reached TD in the Westphalian and did not penetrate the Bowland Shale. The Kirkham Abbey formation is of Permian age, the same reservoir as the onshore Pickering and Kirby Misperton fields.
Thanks DavidS – KatT you have your answer – Rathlin did not drill into the Bowland Shale in this second well; this would likely be because it is not of interest to them.
OPEC are in charge of oil prices. They supply and withdraw to suit their needs. The US are overproducing. They need high prices to cover their shale extraction costs and not go under. This is doomed to failure as there is not much point supplying your home market with expensive energy. OPEC can play the US because their conventional extraction systems are much cheaper than rapidly depleting unconventional wells.
Ever wondered how much the US economy is loosing from the Trump tax reduction?
A trillion dollars.
You can drill as many expensive shale wells as you want but OPEC will make sure you loose in the long run. Sweet spots don’t last forever.
Good job USA are set to eclipse Saudi Arabia as world’s biggest oil exporter, then John! (Source-Rystad report.) Not bad, since Congress only lifted the 40 year ban on oil exports in 2015.
Saudi 2018: 9m bpd/day-oil/gas
USA 2018: 8m bpd/day-oil/gas.
Looks as if OPEC really have a grip on the situation! Hope they have a grip on the Straits or will they trust Donald will help them out?
As the largest user of oil and gas USA can control output as they wish. Sometimes they may wish to maximise exports, other times not. They can also control other countries exports eg. Venezuela, Iran, Russia. However, it will be many a long year before OPEC manage to turn USA back to an importer, so they will need to rely upon growth in India, China and Africa. Interesting implications there regarding climate change.
John Powney
The income has dropped some 150 Billion
It is the federal deficit which is approaching 1 Trillion, which has been growing for a while, under a few presidents, although Democrats probably would like it to be a trillion for the next election.
https://fred.stlouisfed.org/series/FCTAX
Re OPEC being in charge of oil prices, is a bit of a simplistic approach.
They have a say, but sanctions, internal squabbling and cheating means that they are not the force the were in the 1970s
https://www.reuters.com/article/us-oil-opec-survey/opec-oil-output-hits-four-year-low-on-saudi-cuts-venezuela-blackouts-idUSKCN1RD26N
Indeed, although you say that the US needs high prices, the article above notes the opposite – saying
The survey suggests that Saudi Arabia and its Gulf allies are pressing ahead with even larger supply cuts than called for by OPEC’s latest deal, shrugging off pressure from U.S. President Donald Trump to increase supply. On Thursday, Trump again called for OPEC to pump more oil to lower prices.
No doubt we shall see how it all pans out over the year, which will be something unexpected as ever.
Only $1 trillion, John?
Mrs. May thinks her legacy is worth £1 trillion. But, New Zealand reckon that is an underestimate and would cost 16% of GDP-equating to £560bn a year if applied to UK.
Just shows how easy it is to spend other peoples money. Well, it is until they notice.
KatT
Indeed, the loss of money in the US Shale industry is well reported, as is the reluctance of wall street to fund sections of it.
Some of the ‘pay to read’ investor services have been flagging this recently. They expect that trump will bail out the shale sector as he needs US production at existing levels for geopolitical reasons.
The costs are not massive (compared to the last troubles ).
The bail out would also keep oil prices steady, as Trump does not want them too high ( for his voter base ) or too low.
There is a probability attached to this, of course. Plus some companies (bp for example) have bought into Permian shale oil.
So – maybe there will be a shakeout in the industry, or zombie companies will continue to drill and lose money funded by the fed.
We shall see. The advice is to pop your money into industries supporting fracking.
How this applies to the economics of fracking in the UK is interesting. So far, fracking in the UK has been for gas, which is the poor relation to fracking for oil. So it may not be economic to extract fracked gas in the UK, although the infrastructure to pop it into, and the market for it is more mature than in the US. We would only know once fracking has taken place and draw conclusions from that (outwith any concerns over security of supply ).
As Martin notes, there have been beneficiaries in the USA from the fracking activity in terms of cheaper power, more chemical plant feedstock, jobs, investment etc etc, so although wall street may not be happy, no doubt the president and congress may take a broader view of the benefits to the US economy and global presence.
For the West Newton activity though, this has no relevance, as the money they have raised is to explore a conventional reserve.
hewes62-always the way, especially in USA, with such growth industries. All sorts flood in to try and make a buck, and after a while the efficient do, and the inefficient don’t and lose out. Meanwhile, the consolidation brings bigger fish who are more able to utilise their mass.
USA sees oil and gas as a geopolitical strength, which they have utilised successfully since Trump was elected and they will not give that up readily.
Martin
Indeed – one to keep an eye on, but Warren Buffet has popped some money into fracking in the US, which raised eyebrows.
Maybe all the money is going on US in the middle of $200 Billion spending spree on 333 new chemical plants, with better environmental standards, KatT? (See Sir Jims letter to Junker.)
Wonder what has enabled that?
The same Sir Jim that has had a few hundred million to spend on sport but not to upgrade his plant in the North East of England so that its emissions stop breaching U.K. law? And do you mean the petro chemical industry associated with Cancer Alley?
https://www.bigeasymagazine.com/2019/04/01/they-dont-call-it-cancer-alley-for-nothing/
https://www.desmogblog.com/2019/03/28/cancer-coalition-against-death-alley-louisiana-expanding-petrochemical-industry
https://www.theguardian.com/us-news/ng-interactive/2019/may/06/cancertown-louisana-reserve-special-report
https://en.m.wikipedia.org/wiki/Cancer_Alley
https://www.thetimes.co.uk/article/sir-jim-ratcliffe-s-firm-ineos-made-threat-over-dirty-air-rules-3qzgwxrcg
Not when new chemical plants are built and they operate to much higher standards than what has been the case, KatT. You should embrace such improvements that are possible due to the fracking industry in USA. But no, you just want to stop all industrial activity in the West and export it to China. Perhaps have a look at their standards-except you will not find much of that on Giggle.
You may be lucky regarding his plant in the North East. Perhaps he will just decide better to include a new site within his Saudi investment but then he may not be so willing to contribute £millions to help our injured service personnel. As he has recently stated, his UK business does not make a profit, unlike USA, Belgium or Germany, so maybe best for him to just move it. Shame another group of UK workers would lose their livelihoods. Very hungry, your collateral damage monster. Seems once the gloss starts to be removed from the antis, there is a rather nasty sub surface.
KatT
I find this stuff interesting.
The question is – is there a cancer alley, or something else?
Links within the articles you link to – once they get over the title (which draws you in ) are ….
https://www.nola.com/politics/2000/05/cancer_alley_myth_or_fact.html
and
https://www.ncbi.nlm.nih.gov/pmc/articles/PMC1473137/
The second link is an interesting read, and helps understand the difficulty in working out what is going on, especially for cluster events.
Plus (outwith whether a guy photographed without any appropriate PPE on an industrial site where, clearly those with him were mandated to will upgrade an old plant with only a few years left to run) , is there a UK Cancer alley?