Opposition

Report challenges industry arguments for UK onshore oil

The UK does not need more onshore oil to deliver energy security, net zero emissions, jobs or feedstocks, a new report has concluded.

Angus Energy oil site at Brockham, Surrey, on 16 December 2018. Photo: Brockham Protectors

Written by the Weald Action Group campaign network, the report refutes arguments made by the onshore oil industry when applying for planning permission for new oil sites. These include a key claim that UK onshore oil has a lower carbon footprint than imported oil.

The group, which opposes oil and gas developments in southern England, accuses the hydrocarbon industry of “misinformation”. It says planners needed to ask more questions, “rather than taking oil companies’ claims at face value”.

The report’s key conclusions include:

  • New UK oil sites would increase the global supply of oil rather than shutting down sites in other countries
  • There is no low-carbon oil: attempts to compare the carbon footprint of different sources of oil are misleading and ignore the complexity of the global oil market
  • Additional onshore oil fields, with a lifetime of 20+ years, are not needed to maintain security of supply because demand for oil is falling
  • Applications for new oil sites promise very few jobs or are unstaffed
  • More oil is not needed to make additional plastic, even with increased need for personal protective equipment because of the Covid-19 crisis.

The report, Why we don’t need more onshore oil in the UK, calls for an urgent review of policies that influence planning decisions on onshore oil, describing them as out of date.

It also recommends the Committee on Climate Change should review the role of oil in the transition to net zero carbon by 2050 and provide new advice to government based on current evidence and science.

Professor Paul Ekins, Professor of Resources and Environmental Policy at University College London, said of the study:

“This excellent report shows that new onshore oil wells in the UK are economically unnecessary as well as being environmentally at odds with the government’s climate rhetoric.”

Ann Stewart, of the Weald Action Group, said

“We need urgent change. Decision-makers are under pressure from oil companies wanting to expand operations across the South of England. They are out of step with the times and the science. The environmental costs are too high and the oil their sites might produce is not needed”.

Carbon footprint

Photo: Brockham Protection Camp

Oil and gas companies state that oil produced in the UK has a lower carbon footprint than imports from a long distance away.

The report argued:

“There is no low carbon oil. Claims that new UK oil is needed based on comparisons of the carbon footprint of different sources are extremely narrow in their framing and ignore the real impact of new oil wells on the climate.

“In the absence of a global cap on oil supply, any new oil well approved for commercial production will likely increase the amount of oil in the global market and not replace that which is already in production. This will lead to a net increase in global greenhouse gas emissions when the oil is burned to generate energy.”

The report acknowledged that transporting oil by ship would add to its carbon footprint. But it said the oil company claims belied the workings of the global oil market.

UK onshore oil may not displace long-distance imports. It could, instead, displace oil arriving by pipeline from Norway, which may have a lower carbon footprint than UK oil, the report said.

Domestically-produced onshore oil may not necessarily be used in the UK because we export crude oil and petroleum productions, it added.

Energy security

The report addresses a key argument made by hydrocarbon companies that new onshore exploration and production is essential to replace declining supply from the UK continental shelf.

It says this was misleading because:

  • UK energy security compares well with OECD countries in the diversity and political stability of oil imports
  • The UK has been a net importer of oil since 2006 and while the overall trend in domestic oil production is down, recently production has increased
  • Demand for oil is falling in the UK and action to meet carbon budgets will require policies to speed up reduction in demand
  • Imports may also fall
  • New onshore fields are not needed to maintain security of supply

Feedstocks

UKOG’s chief executive, Stephen Sanderson, giving evidence to Surrey County Council. Photo: DrillOrDrop

Earlier this year, UK Oil & Gas plc responded to a protest at one of its sites saying oil and gas are used to as a feedstock for products including personal protective equipment and other forms of useful plastic.

The report described this argument as a “myth”:

“Currently, most oil is not used to make plastic, it is burned to generate energy. In Europe 4-6% of oil and gas is used to make plastic and 87% to generate energy.”

It said oil and gas companies were banking on an increase in demand for plastics. But it said this was now very uncertain because plastics could be reused and recycled numerous times.”

“We do not need more oil to make plastics. Plastics are having a catastrophic impact on the environment, particularly the oceans and seas, and every effort should be made to curtail their use where this is possible or to use sustainable alternatives where these exist.”

Jobs

Onshore oil and gas companies frequently say their proposals will generate local, highly skilled jobs.

The report said these claims were often not backed by actual figures and were hard to substantiate. The facilities seem to run with a small onsite workforce, it said. There is a strong overlap, it said, between the skills needed to work in the oil and gas sector and those needed for offshore wind, marine renewables and energy efficiency work.

Planning policies and climate science

The report accuses of oil and gas companies of justifying plans for new sites by talking about the “need” for oil. They refer to energy strategies that pre-date the Paris climate agreement and the UK’s net zero target, the report said.

It added:

“many councils across the UK have also made Climate Emergency declarations. Consequently, there is a conflict between the climate change obligations and ambitions of Councils and the outdated legislation that promotes the maximum economic recovery of domestic fossil fuels.”

The report said a legal ruling in March 2019 had removed a policy requirement on councils to facilitate exploration and extraction of onshore oil and gas. It also argued that a clarification in the National Planning Policy Framework’s meant that “arguably new fossil fuel extraction does not meet sustainable development objectives”.

Mineral planning authorities must abandon any presumption in favour of new onshore oil developments, the report said.

“They should assess all the impacts flowing from their decisions, including the indirect greenhouse gas emissions from produced oil, and align their decision-making with their own climate emergency declarations.”

DrillOrDrop has invited comments from UK Oil & Gas plc, Rathlin Energy and the industry organisation UK Onshore Oil & Gas (UKOOG).

Ken Cronin, chief executive of UKOOG, said:

“Failure to develop indigenous oil locks the UK into a reliance to import 3.4bn barrels over the next 30 years, representing £170bn leaving our shores.

“Oil is not used just in the creation of plastics and transport fuel, but in vital medicines, hygiene products and, saliently, energy efficiency materials.

“Ultimately, utilising our domestic oil resource serves to provide the UK with a lower carbon source of oil produced in a world-leading regulatory environment, generating far more by way of local economic gain than the fuel we import across oceans and continents from those less cautious of the environmental impact. There is a prominent role for electricity generated by wind and solar power in the future, but electricity is just one form of energy, and it cannot replace the fuel that builds, not just burns.”

Links

Full report: Why we don’t need more onshore oil in the UK

Executive Summary

Updated 16/10/2020 with comment from UKOOG

17 replies »

  1. Hmmmm

    Good heavens – hair raising stuff – wow, 2400, wells!!!!

    In 2016 a forecast commissioned by UK Oil & Gas PLC (UKOG), acompany that has a keen interest in the Kimmeridge,
    controversially claimed that if exploited this oil could generate billions for the UK economy over 40 years of
    production.15 Crucially though, the production scenarios on which these figures were based would
    (given the unconventional nature of the oil and the rapidity with which oil flow rates reduce) reportedly require the drilling of around 2,400 wells from at least 100 sites across the region. This would represent a phenomenal scaling up from the fewer than 200 wells
    in existence today, posing an unacceptable threat to the climate, wildlife, countryside and local
    communities…

    Read on a bit

    In 2019 UKOG subsidiary Horse Hill Developments Limited received planning permission to drill four more oil wells at its flagship fossil fuel site at Horse Hill in Horley, Surrey, and for 20 years of production.

    So – 4 wells required for 20 years production. Not yet drilled.

    4 wells in 4 years, so maybe 2400 years to complete the wells noted above?

    Sounds like a sustainable local industry with little impact on the environment (at the rate it is progressing)

    There are some pretty flaky comments on local jobs as well.

  2. Re lower carbon intensity

    the report notes

    Oil from Norway may have a lower carbon intensity than oil produced in the UK, according to an article published
    in the journal Science in 2018. 51

    re 51 is titled, ‘Global carbon intensity of crude oil production’

    I see nothing in the report that supports the comment above, although – I may have missed it and would be happy if the particular part of the report that leads to that conclusion that imported Norwegian Oil has a lower carbon intensity that onshore UK oil, is presented for the interested reader to consider (and in particular the oil produced by UKOG)

      • Paul

        Thanks – yes, gas the large Norwegian fields may have a lower carbon footprint than the more diverse and in general older gas fields and associated gas fields of the UK. There will be fields that are better or worse depending on size and age in every case (this is out with the LNG argument).

        Re oil, there will also be, no doubt oilfields where the oil is happy to appear at the surface without any pumping, and those where it required a large amount of energy to get it (be it downhole pumps, vast amounts of seawater injection or for fracking, the energy to do that and the well density.

        Perhaps we should only import low carbon footprint oil, from new fields developed with few wells and a suitable gas cap as a driver (and we can call it ‘green oil’ or something just to get into the clean or dirty discussion) and only if that oil has a lower carbon footprint then local onshore oil in your county.

        So interesting to see a report which is so vague. But understandable.

        A company wants to extract oil because its there (as opposed to somewhere else), and a group who are there (and elsewhere) do not want that to happen. Both write long justifications for why they be allowed to do it or not, and all arguments are dragged up on both sides and given a good scrub down.

        I will read a bit more of the report later. Energy security is not just about how easy it is to get a commodity from abroad, the UK had an energy shortage a few years ago (three day week, sat round candles in the evening ), even though there was (then and now) no shortage of coal reserves in the country.

        • Interesting that energy security is raised just at the same time as the National Grid warn about energy security, like NOW!

          Last time I remember this old spud surfacing on DoD it was jP pontificating about plenty of cheap gas and oil around the world just as the Beast from the East arrived in UK, and then there was a hike in prices and businesses told to reduce their usage of energy to enable householders to be supplied.

          A country without significant energy storage does NOT have energy security, when it is importing significant amounts of energy.

          • Martin

            I had energy security in the form of a oil fired boiler and a generator in the garage for power cuts (plus a tonne or two of coal and a pile of wood for the multifuel stove). Now its a gas boiler and a gas fire, so not so much energy security as before.

            I will have to read the report further so see how the issue of energy security vs loss of supply works (what police are deployed to those parts of the country where the gas / oil comes in – to ensure no one interferes with that source of supply)?

      • Paul

        What you like to highlight is a small percentage & takes no consideration of the many other benefits for the UK by producing indigenous oil.

        As you also say it takes no account of the gas to wire that is used in onshore oil production which is a renewable energy supply.

        The benefits to the UK are many fold & would help in the transition period & could the upgrade of energy efficient homes maybe in the local areas of the well sites from the royalties which will be provided to local communities as stated by UKOG.

        Why is it that Drill or drop never wants to find any positive solutions?

        Is it just because it is part of a bias pressure group?

    • You will will see support for these comments in the references. All statements in the report are based on detailed evidence elsewhere, and are referenced. Often these are from the governments own websites.

      • But, they are still nonsense, Ann. I have given a couple of examples where the nonsense is so evident. If you believe that is not the case, that is your choice.

        • Ann

          To be a bit more specific

          The report states – all oil is dirty

          In that section the report states

          …….Oil produced in the UK may not necessarily displace the use of long-distance imports. It could,
          for example, displace oil transported by pipeline from Norway, which may have a lower carbon
          footprint than oil produced in the UK.

          A report is then cited as supporting evidence.

          However, the comment above (Oil produced in the UK etc) does not support the statement that ‘all oil is dirty’

          It says that, pipeline oil from Norway may have a lower carbon footprint than oil produced in the UK. While the report is fine, it does not support the initial statement, nor does it discuss the case of onshore oil, and in particular oil in the Weald.

          Hence to say that there is support for the comments is duplicitous. References have been used to bolster statement, but when inspected in detail, do not always support the statements made.

          There may be statements made in the report which are supported by the references, but it would seem that this is not always the case.

          In this case, the paper has not made the case that ‘all oil is dirty’, nor made the case that oil from the UK will not displace imported oil, nor that oil from Norway has a lower carbon footprint than UK onshore oil.

  3. What a collection of ill-informed comment. Scraping the barrel, comes to mind.

    The alternative is that the authors are better informed but want to mislead, so I will be polite and revert to the former.

    I really can’t see the oil and gas industry bothering to reply to such, but they may be generous.

    Let me help out with one example:

    Plastic is not a problem. Allowing it into the marine environment is. Exactly the same as sewage. So, eradicate, or curtail, human life on the planet to control sewage into the sea? No. Stop the sewage going into the sea, and that has been significantly improved for the UK, with some investment, so what is the insurmountable problem regarding plastic?
    Oil from the Weald to Fawley Refinery. The chemicals plant next to Fawley Refinery recently increased output of synthetic rubber for the use in medical devices due to Covid-19. Curtail that? Or, just continue to import the oil to manufacture? Nope. Local oil for manufacture of such DOES have a lower carbon footprint-unless it is brought to the UK by sail, and even then, would.

    I was not asked about “we” not needing more UK on-shore oil, so maybe this is like “everyone” agrees, when it is a small group of Nimbys that are the we and the everyone?

    By the way, domestic UK on shore oil production has been driven for many years by the largest on shore oil field in Europe, Wytch Farm, which used to produce over 100k barrels per day. Now between 10-15k barrels per day. So, even with the current new wells being explored on shore UK, not much chance of getting back to anywhere near what UK on shore has produced, safely and with no major impacts upon the local environments. Unfortunately, not the same can be said about oil transported by sea, with the Torrey Canyon example available for anyone who wishes to examine. But then, the marine environment in this report only seems to be something to reference selectively.

  4. PS.

    The first bullet point is nonsense. Have the authors not been around when OPEC, and others, adjust the oil output to adjust for changes in demand? They turn the taps, chaps! Always have, always will. So, if they turn a few taps down then less oil produced where the taps turned down. Is it really that difficult?

    • ‘They turn the taps, chaps! Always have, always will’

      OPEC are in charge. They dictate global prices. By controlling output they crippled the US fracking industry. Strange how Donald didn’t realise he was going down a road to nowhere. Billions lost and big players going down the pan. Ponzi schemes don’t stay hidden forever.

  5. No, OPEC are not in charge in USA, but they are elsewhere-largely because elsewhere most countries are dictated to by OPEC. Remember the 1970s?

    But you are correct, jP in that OPEC are, and have been, the worlds largest cartel. So, anyone interested in cartels can see how they work-but this “report” can not.

    Now, my wifey tells me if you over egg a pudding, and some of those eggs are rotten, then it stands out and the pudding is ruined. I was told the same about writing reports, so this one seems to be addressed to a very selective few who appreciate the ruined pudding.

    Enjoy.

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