Page 4 - Euroil Week 42 2019

EurOil COMMENTARY EurOil
Weak prospects for UK fracking
The government’s drive to establish a domestic shale gas industry has seen limited progress
UK
WHAT:
A new report has documented the UK’s lack of progress in developing shale gas and the costs incurred.
WHY:
The report showed that public opposition to shale gas is mounting.
WHAT NEXT:
With Brexit still the main focus and a potential election ahead, the government is unlikely to loosen restrictions on fracking.
THE UK’s e orts to establish a shale gas industry have oundered, having cost the country’s tax- payers at least GBP32.7mn ($42.2mn) over the past eight years, a new report published by the National Audit O ce has concluded.
e report, titled ‘Fracking for shale gas in England’, comes a er the UK’s only active shale gas explorer Cuadrilla Resources was forced to halt operations a er a series of tremors over the summer.
While not examining the merits of govern- ment support for fracking, the report concluded that the UK’s progress in establishing a shale gas industry in England had been slower than the government had planned.” e Cabinet O ce had projected in 2016 that up to 20 wells would have been fracked by mid-2020, but so far only three have been to date.
Cuadrilla and other proponents of fracking argue that the current limits to seismic activity caused by its use are far stricter than those used internationally, hindering its ability to develop its Preston New Road (PNR) site. A er causing a tremor measuring 2.9 of the Richter scale, the company was forced to halt fracking over the
summer. It packed up its fracking gear in late September and said it would not resume use of the unconventional technique until its current licence expires at the end of November. It is yet to apply for an extension, raising prospects that the project could be axed altogether.
With the attention of the pro-shale Conserv- ative government fixed on delivering Brexit, Cuadrilla’s owners appear to have given up hope of a loosening of restrictions, and are now reported to be seeking a buyer for the company.
The cost so far
The report also noted that public opposition to fracking, centring on concerns about green- house gas (GHG) emissions, groundwater pol- lution and fracking-induced earthquakes, had risen in recent years. Only 21% of the public opposed shale gas in 2013, but this had increased to 40% this year, according to the Department of Energy’s public attitudes survey, according to the report. Meanwhile, public support for shale gas has slumped from 27% in 2013 to 12% in March this year.
A core focus of the report was also on the costs
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