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Scramble starts for UK shale-gas licences

Areas from northeast England down southeast coast up for grabs

The next bidding round for UK onshore gas exploration is expected to see a rush for prospective shale plays. According to the British Geological Survey (BGS), some blocks are likely to have similar gas-resource estimates as Cuadrilla’s massive find in northwest England.

Cuadrilla’s drilling results from Lancashire’s Bowland basin indicate it could be sitting on 200 trillion cubic feet (cf) of gas. Although not all of this is recoverable, if only 10% can be extracted, it would be more than double the UK’s estimated 9 trillion cf of proved gas reserves.

Good potential

“The Pennine basin looks like it has good potential. It could contain the same amount of gas [as Cuadrilla’s reserves estimate],” said Nigel Smith, a subsurface geologist at the BGS. “Other prospective areas could be the Cambrian shales in central England, then perhaps north Wales. There’ll definitely be more interest in the next round of UK exploration licences, especially after the Cuadrilla news,” he added.

The areas under 14th round consultation cover northeast England down to the Midlands, through south Wales, as well as to the south and southeast coast.

But the round – originally scheduled for this year – has been delayed until 2012 by a moratorium on hydraulic fracturing (fracking) put in place while the Department of Energy and Climate Change (Decc) completes an investigation into unconventional exploration and production.

Decc’s report will focus on whether seismic work and fracking could have caused a series of tremors near Blackpool this year. The report is expected in the next month, with the government to make its decision on fracking sometime after.

Fracking earthquakes

“The timing of the earthquake and Cuadrilla’s upstream operations could be a coincidence, but it’s difficult to say” said Smith. “There is a precedent. In Cornwall in the 1980s, fracking of granite cause 11,000 earthquakes. But only two were felt: one by the general public and the geothermal explorers at the quarry site.” The BGS is researching the link between fracking and earthquakes, but has not reached any conclusions, he added.

Although Cuadrilla’s shale-gas resource estimate was around 50 times higher than the BGS’s estimate, Smith agreed that such a massive find seemed reasonable. “Combined with the cores drilled by British Gas in the 1980s, and extrapolating against the size and thickness of the shale, it’s a perfectly reasonable assumption to make at this stage,” he said.

BGS’s own shale-gas study, in 2010, estimated 4.7 trillion cf, but did not quantify all the shales and, unlike Cuadrilla, had no gas-content data from the UK. Cuadrilla’s sites in the Bowland basin are part of the Namurian shales, the main source for conventional hydrocarbons in the east Midlands, Formby, Elswick, and in the offshore East Irish Sea basin, while the BGS estimates were from the onshore Pennine basin.

Cuadrilla is the only company fracking in the UK. Another operator, Coastal Oil and Gas, is planning to start drilling coal-bed methane (CBM) wells in south Wales, but does not plan to frack. Decc has issued 334 onshore gas licences, covering shale gas and CBM, as well as conventional gas plays.

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