The licensing of thousands of square miles of English countryside for fracking five years ago has resulted in no wells and no oil or gas.
Areas from the Isle of Wight and Dorset to the North York Moors were allocated to exploration companies in what was described at the time as the “start of a shale gas revolution”.
By today, under the terms of the new licences, the operators should have drilled nearly 100 wells and fracked more than 10% of them.
But analysis by DrillOrDrop shows that in the past five years nearly 20 licences have been abandoned and no shale gas sites have been developed. No wells have been drilled and no fracking has been carried out in these licence areas.
The licences were awarded under the 14th round, a competitive process organised by the Conservative-Lib Dem coalition.
Launching the bidding in 2014, the then energy secretary Matt Hancock said:
“Unlocking shale gas in Britain has the potential to provide us with greater energy security, jobs and growth”.
The 30-year licences started on 21 July 2016 and were due to last until 2046, four years short of the UK target for net zero carbon emissions.
Each licence, know as a PEDL (petroleum exploration and development licence) was divided into three phases:
- initial term: drilling, testing and fracking
- second term: appraisal and development
- third term: production
The initial term of the 14th round licences was due to last five years and end today (20 July 2021).
The successful companies committed during the initial term to carry out 2d and 3d seismic testing, drill a total of 96 wells and frack 12 of them.
But to date only two planning permissions for any type of oil and gas well have been granted in 14th round licence areas.
Both these consents were issued to Ineos Upstream Limited, a subsidiary of Sir Jim Ratcliffe’s giant petrochemical empire. Both applications had been refused by the mineral planning authority and were decided after public inquiries.
One of these consents, at Harthill in south Yorkshire (PEDL304), expired last month with no physical work on the site, apart from the installation of bird scarers and some archaeological excavation.
Another, in PEDL300 at Marsh Lane, in Derbyshire, is expected to expire in mid-August. No work has been carried out on this site either.
Three other planning applications in 14th round licences are waiting for a decision. These are:
- Woodsetts in south Yorkshire, in PEDL304 – decision awaited by the local government secretary after an appeal by Ineos against refusal for shale gas exploration
- Arreton on the Isle of Wight, in PEDL331 – decision awaited on an application by UK Oil & Gas plc application for conventional oil exploration
- Athelhampton Road, Puddletown, Dorset in PEDL327 – extra information requested by Dorset County Council for an application for oil exploration by South Western Energy Limited
One more potential site has been identified for conventional oil at Godshill on the Isle of Wight. But the operator, UK Oil & Gas plc has not submitted any applications.
Seismic testing, which does not need planning permission, has been carried out by Ineos in 14th round areas of Derbyshire, south Yorkshire and Nottinghamshire.
But DrillOrDrop is not aware of seismic testing in 14th round licences held by some of the other operators, which include Cuadrilla, IGas, Aurora Energy Resources Limited and Egdon Resources UK Limited.
A PEDL licence would normally be expected to lapse if the operator did not meet its work commitments.
But DrillOrDrop analysis of data from the regulator, the Oil & Gas Authority (OGA), shows that 60 14th round licences will continue with an extended initial term despite not meeting their original commitments.
For 41 licences, the initial term now ends on 20 July 2024. Another 18 licences will end their initial term a year earlier on 20 July 2023 and one ends on 20 November 2021. (See the end of this post for the specific PEDLs).
Many of these extensions have been made in the past year. A freedom of information request by DrillOrDrop in 2020 revealed that 14 PEDLs had their initial term extended to 2023 and another eight to 2024.
The OGA confirmed that since the start of the pandemic, it had not granted any onshore licence extensions solely on the basis of COVID-19.
The most likely reason is the government moratorium on fracking in England. This was imposed in November 2019 after fracking by Cuadrilla at Preston New Road near Blackpool induced small earthquakes that were felt across the region.
Three quarters of the 14th round PEDLs (46) were described by the OGA as shale gas licences.
They would be at least indirectly affected by the moratorium.
The onshore industry lobbied for the moratorium to be lifted but it remains in force.
Last week the energy minister, Lord Goldsmith, said the government had no plans to review it or support shale gas exploration unless and until science demonstrated categorically that fracking could be done safely for both people and the environment.
There is evidence that operators have sought extensions because of the moratorium.
In December 2019, the FT revealed that Cuadrilla had asked the OGA to extend the terms of its fracking licences in England by “whatever time period the recently announced moratorium lasts”.
This might help to explain why the OGA extended the initial term of some shale gas licences. But only nine existing 14th round PEDLs had a commitment in their work programme to frack a horizontal well. That leaves 37 licences with no initial term requirement to frack.
There are also question marks about why there should be extensions to some other licences.
South Western Energy’s PEDL327 is listed by the OGA as targeting shale gas but the proposed site at Puddletown is for conventional oil. Four PEDLs listed as targeting mine gas have had extensions until 2023 and two to 2024.
Talking about a revolution
Not surprisingly, the onshore oil and gas industry warmly welcomed the award of the 14th round licences in 2015.
At that time, the industry body, UK Onshore Oil and Gas (UKOOG) described the award of licences as “a vital day for the future of energy in the UK”. It said there was an opportunity to create “tens of thousands of jobs, reduce imports, generate significant tax revenue and support British manufacturing from an extremely small footprint which will benefit the environment at the same time”.
Ineos, the biggest winner in the 14th round, said:
“This is the start of a Shale gas revolution that will transform manufacturing in the UK. INEOS has the skills to safely extract the gas and we have already committed to both fully consult and to share the rewards with the local communities.
Its commercial director at the time, Patrick Erwin, said:
“If the planning system works as well as we hope, we should have meaningful production of shale gas in the UK by the end of the decade”.
“This is a critical time for the future of Britain’s energy mix as gas, of which 50% of our consumption is currently imported, is central to our energy security as we transition to a lower carbon environment.”
Back in 2015, many environmental organisations feared the 14th round had fired the starting gun for fracking across England.
“This announcement means that vast swathes of British countryside have been opened up to fracking. And now that fracking under National Parks and other protected areas has been pushed through – it seems that nowhere is sacred.”
Frack Free North Yorkshire described the scale of planned operations as “staggering”:
“If these plans are allowed to go ahead, Yorkshire will soon become one huge gas field, with grave consequences for our local industries, environment, wildlife, health and peaceful way of life.”
Frack Free Ryedale said:
“If local people haven’t been worried about fracking up to now because it’s not happening on their doorstep, then it is time for them to wake up and smell the methane. Fracking is now on everyone’s doorstep.”
In 2021, the industry continues to maintain that it will prove that fracking can be done safely and the moratorium will be lifted.
Many opponents argue that the fracking revolution had been killed by earthquakes, public opposition and UK climate change commitments.
DrillOrDrop will continue to follow the fortunes of the 14th round licences in their extended initial terms.