The shale gas company, Cuadrilla Resources, is looking at conventional oil and gas opportunities in the UK after predicting no fracking this year.
The company’s fracking operations at Preston New Road near Blackpool were suspended on 26 August 2019 after inducing a 2.9ML earthquake, felt across the region.
The government issued a moratorium on fracking in November 2019 following advice from the regulator, the Oil & Gas Authority, about the risk of seismic activity.
A statement from Cuadrilla’s Australian owners, A J Lucas Group Limited today, said:
“The business is actively engaged with other UK shale gas operators and the relevant authorities to provide them with sufficient confidence to allow the return of shale exploration activities under sensible parameters.
“Cuadrilla estimates a return to operations will not take place this calendar year.
“Cuadrilla is also reviewing opportunities within its extensive UK onshore licence acreage for ‘conventional’ oil and gas prospects that would not require hydraulic fracturing to appraise and produce.”
Last year, an A J Lucas statement said Cuadrilla would “conduct an examination of various acreages ahead of an anticipated resumption of exploration activities.”
As well as the Lancashire licences, Cuadrilla has interests in the Balcombe oil well in West Sussex and newer licences in North, East and South Yorkshire.
People living near the Preston New Road site have continued to campaign against Cuadrilla’s activities and welcomed parts of today’s statement.
The Preston New Road Action Group said this morning:
“It is good news that Cuadrilla are admitting that they are unlikely to be able to do anything further at PNR this year.
“With the moratorium still in place, unexplained earthquakes from last year and public support for fracking at an all-time low, the future must be looking rather uncertain for them.
“Surely it must be time for them to give up and restore the site. This would be a great burden lifted from our community.”
A spokesperson for Frack Free Lancashire said:
“[We] welcome AJ Lucas’s recognition that without public support the future for shale gas extraction in the UK looks extremely bleak and that a return to operations will not take place this calendar year.
“In our opinion even that expectation is hopelessly optimistic.
“We would suggest that they finally recognise that, with opposition to fracking at an all-time high, they should now stop flogging this dead horse and remove their unwanted presence entirely from Lancashire and the UK as a whole.”
Another campaigner, Barbara Richardson, said:
“If Cuadrilla’s, and other oil and gas companies, share price is anything to go by, investors have very little confidence in the sector. Time people started to invest in renewables instead; a better prospect financially and environmentally.”
A J Lucas took control of Cuadrilla in February 2020 when it increased its interest to 93% by acquiring the 45% stake held by Riverstone, a New York based private equity firm.
Today’s statement also announced a restructuring of A J Lucas to focus on the Australian drilling business. It said:
“This recognises that future development of the Group’s UK shale assets will need to await a lifting of the moratorium on hydraulic fracturing currently in place and a demonstration of Government support for onshore shale gas exploration activity.”
The statement said Francis Egan would continue as chief executive of Cuadrilla Resources Holdings Limited and had joined the board of AJ Lucas:
“following the integration of Cuadrilla into the Group, [this] will facilitate the direct involvement of the Board in direction setting of this business”.
A J Lucas’s Sydney office will close and all corporate office operations would relocate to the Brisbane office of Lucas Drilling, the statement added.