Page 5 - EurOil Week 27 2019

EurOil COMMENTARY EurOil
Newgrange prospect off the west coast, and awaiting clearance to secure a frontier explora- tion licence at its Avalon prospect in the Porcu- pine Basin.
Risks remain
Had Ireland implemented the bill, it would have become one of only four countries in the world to ban the issue of licences, alongside France, Costa Rica and Belize. But opposition to upstream development in Europe is on the rise, with Italy’s new populist government announc- ing plans in January to block the issue of 36 oil and gas exploration permits as part of e orts to scale back the country’s carbon footprint. Some experts believe Italy has the resources to increase its gas production signi cantly, which amounted to 5.2bn cubic metres last year. But red tape has impeded development for decades.
Meanwhile, Scotland has had a mor- atorium on the use of hydraulic fractur- ing since 2015, much to the frustration of
Grangemouth petrochemical giant Ineos, which wants to exploit shale gas to the south and west of Falkirk. e company last week had its exploration and development licence for the 400-square km site renewed for another year until the end of June 2020. But with Holyrood preparing to make its ban nal, the project is unlikely to be realised.
Even in places where the unconventional drilling technique is not banned, operators face an uphill struggle in overcoming local regulatory and planning issues, as Cuadrilla has discovered in north-west England.
While Ireland’s oil and gas industry has scored a key victory in persuading the govern- ment to axe the climate deal, there remains huge support in the country for a cessation of o shore drilling. ere is therefore a risk that the current government or its successor (there are calls for a snap election this year) could give in to pub- lic pressure and reverse course. e uncertainty alone will undermine development prospects.™
Europa Oil and Gas’s offshore Irish leases Source: Europa Oil and Gas
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