Sunday, 8 April 2018


Fracking, Brexit And An Oil And Shale Gas Bonanza
Gary K. Busch, Lima Charlie News, 4 April 2018

As the U.K. celebrates its final year as part of the European Union, it is standing on the brink of a major boost to its economy and prosperity as it awaits the first economic benefit from its rich oil and gas shales.


British exploration and production company Cuadrilla and others have fought a long battle to begin drilling in earnest for the extraction of shale oil and gas in the UK. British shale reserves are extensive and rich in gas and oil trapped in sedimentary basins in several parts of the nation, but especially in Lancashire and Yorkshire. The British Geological Survey estimates that the Bowland basin holds 1,300 trillion cubic feet (tcf) of gas. Almost seventy wells have already begun. The reserves are enormous.

“If a tenth can be extracted – and US frackers can do better than that – it would cover Britain’s entire gas needs for half a century,” according to Ambrose Evans-Pritchard in The Telegraph.  The same article quotes Cuadrilla’s chief executive, “We’ve just drilled the rocks and they are the best results we’ve ever seen. It is a huge resource. This could last us through to 2050.”

Britain used to be an energy exporter. Britain was a net exporter of energy until 2003, when the balance was reversed by the policies of the government of Tony Blair and sustained by the opposition of the Green Party.

This inability to deal with British energy supplies has produced a costly and threatening energy posture until recently, when the UK government gave the go-ahead to start drilling. The energy industry has shrunk from around 10% of GDP in the late 1980s to the current percentage of around 2%. In the interim, Britain has become a net importer of energy supplies and has been paying for energy supplies on the price terms of the international market.


Since that decline, Britain’s energy supplies and trade have been in imbalance. Britain began to import energy at a period when supplies were decreasing and the prices high. In a key study conducted by the UK Department of Business, Energy and Industrial Strategy in July 2017, “UK ENERGY IN BRIEF 2017” – the researchers pointed out that the UK was a net importer of energy.

The reaction to the constraints on the energy supply were also the result of European policy diktats. Britain has been held back in the development of its vast fracking reserves by the politics of the European Union as well as by its Greens. EU policy has allowed the EU to become dangerously dependent on supplies from Russia and has only recently sought to diversify its supply elsewhere. The diversity included allowing for import terminals to be built in Lithuania and elsewhere to import LNG into Europe, but it has not included the EU allowing for fracking to be pursued by drilling within the region.


An advantage of the UK leaving the European Union will be its embrace of energy resources that will enter the market from fracking and the immense collateral advantages of having a large domestic supply of energy at an inexpensive price. Included is the creation of jobs required in drilling, transport, and storing the oil and gas as well as the creation of a burgeoning market for steel pipelines, storage tanks, chemical processing of the feedstocks of oil and gas production, and an export industry of energy to the EU, among others.

A new generation of marine vessels needs to be built run on LNG or compressed gas, along with a bunkering facility for these vessels when they reach European and UK ports. Coal-fired electrical plants can be phased out and reconstructed using gas as a feedstock. Recent studies have shown that replacing coal as a feedstock by gas reduces emissions by more than two-thirds. The environmental advantages include stopping the spread of nuclear energy and augmenting the gas production by using Britain’s expanding offshore-wind energy supplies.

The trend towards using gas as an energy source has already changed the European energy market; however, with largely imported supplies.


Britain currently has a large domestic pipeline system with over 21,000 miles of gas pipeline in place, allowing for easy distribution of fracked gas throughout the nation. Major international gas pipeline interconnectors allow for the transfer of gas to the EU without the need for turning to LNG or compressed gas, which would prove competitive to U.S. and Russian LNG. […]

Brexit and Fracking

The U.S. found that the level of serendipity of fracking included many local jobs in shops and retail establishments, the decentralisation of major investments in factories and refineries towards the areas of energy production, and even the laying of fibre-optic cables along with the new pipelines which provided a broad network of rural internet connections.

The British Government has set up a scheme to reward the local communities in which drilling takes place and a proposed Shale Wealth Fund to make sure that local communities benefit directly from fracking in their neighbourhoods. A fracking bonanza could be a great benefit to all UK citizens and local communities.

The UK is now standing on the brink of an industry which could dramatically revive its fortunes outside the EU. By the time of the British exit of the EU and its “implementation” period the fracking industry will have begun to produce real returns for the country. The EU may find that it needs the UK far more than the UK needs the EU.

As Europe tries to free itself from dependence on Russian oil, the UK energy supply can play a major political factor in providing a reliable, interconnected, alternative source.

1 comment:

  1. When there is only 0.04% of C02 in the atmosphere (measured in parts per million!) there is no worry about "emissions" - or shouldn't be. Plants need C02 and struggle to grow when the percentage of carbon dioxide is reduced in the atmosphere !


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