The shale gas lobbying organisation has accused the government of dealing in “ideology and fiction” by reinstating the moratorium on fracking.
In a response two days after the news, UK Onshore Oil and Gas (UKOOG) said neither the Conservatives nor Labour had what it described as a “credible gas supply plan” for the years to 2050.
“[This] signifies that the UK is closed for business and that ideology, fiction and political weather outcompetes reason, fact and reality.”
The statemented added:
“The re-introduction of this moratorium shows that the Government favours an illogical ‘fingers crossed’ approach to meet our gas needs, an approach that has led us into the ongoing energy crisis.
“… this perverse decision will come at great economic, environmental and geopolitical cost.”
Investment and jobs
UKOOG said shale gas had created a thriving industry in jurisdictions with similar geology to the UK, creating “billions of pounds in investment and tax revenues”:
“The Government has now taken a conscious decision to throw away the chance to see £33 billion of investment into the North of England, creating tens of thousands of well-paid and skilled jobs, tax, community benefits and energy security. Instead, it has decided to hold itself to ransom in the international gas markets.”
The £33 billion figure in UKOOG’s statement is based on a 2014 report it commissioned from Ernst & Young. This said £33bn investment would be needed from 2016-2032 to establish 4,000 shale gas wells. This would generate 6,100 direct roles and 58,400 indirect jobs at the peak, assuming production of more than 28 billion cubic meters per year by the 2020s.
UKOOG’s statement said the reinstatement of the moratorium meant the “country is further away than ever from achieving any form of energy independence”.
The government would have to explain why it had decided to “abandon a world class resource under our feet” and why communities in northern England are “losing out on hundreds of millions in community benefits”, the statement said.
Updated estimates by UKOOG in 2019 suggested that annual shale gas production could peak at almost 1,400 billion cubic feet in the early 2030s, equivalent to the gas use of 35 million homes, which is more than the UK total. This level of production would eliminate the need for gas imports, the organisation said.
A review by Warwick Business School in 2020 concluded that a UK shale gas industry was unlikely to do more than partially compensate for the decline of domestic offshore production. It said exact resource estimates remained uncertain.
Analysis by Carbon Brief’s policy editor for the Guardian suggested fracking would not produce enough gas to meet even 1% of the UK demand for more than three years. After an immediate start, we would have to wait until the late 2020s for more than 5% of UK demand to be met by domestically produced shale gas, the analysis said.
Earlier this year, the former chancellor and business secretary, Kwasi Kwarteng, told the Mail on Sunday it would “take up to a decade to extract sufficient volumes – and it would come at a high cost for communities and our precious countryside. “No amount of shale gas from hundreds of wells dotted across rural England would be enough to lower the European price any time soon”, he said.
There is currently no statutory benefit scheme for people living in shale gas production areas.
UKOOG said jurisdictions with successful shale gas industries had “significantly reduced their carbon emissions”. It said the government now favoured “more carbon intensive and less secure imports”.
Last month, more than 100 businesses, including Legal and General, PwC, Ikea, Johnson Matthew, Scottish Power, Sky, Amazon and BNP Paribas, wrote to the then prime minister, Liz Truss, urging her to prioritise energy efficiency, decarbonisation and renewables to speed up the shift from fossil fuels.
The Guardian suggested UK households could cut carbon emissions by up to 6m tonnes, the equivalent of taking nearly 3m cars off UK roads, if they adjusted their boiler settings.
The UKOOG statement did not mention fracking-induced earthquakes, the reason why the moratorium was introduced in November 2019.
A scientific review, commissioned by the government and published last month, concluded that forecasting of both large earthquakes and their magnitude remained a scientific challenge.
A 2.9ML earthquake caused by Cuadrilla’s fracks at Preston New Road in 2019 was felt across the region and prompted nearly 200 reports of damage to property to the British Geological Survey.
This morning, a UKOOG member, IGas, said in a statement that it was reserving the right to take legal action to recover losses it had incurred through investments in shale gas developments.
DrillOrDrop asked UKOOG whether it thought the industry had a good case. At the time of writing, the organisation has not responded.