Category Archives: Shale Gas

Living to tell the tale

Indulge the elegiac tone here. It will soon be obvious why.

I have been so blessed in so many ways. Life is too short to be wasted on regret, but as Francis Albert Sinatra sang, I’ve had a few of those, and as I start thinking about my legacy, I’ll inevitably address the negative side of that over the next few weeks.  I intend to do that filtered via a collaborator who hopefully will curb my worst impulses. Continue reading Living to tell the tale

No Deathbed Conversion: My view on onshore UK gas

August is the traditional peak of the silly season when the UK media uses any number of tenuous, out dated or too often, simply bored attempts to feed the maw of the media machinery. With audience and grown ups away, the field is opened up to a new crop of writers misguided enough to still see some romance in the formerly noble métier of journalism.  Many of them are “interns”, or what anyone in most jobs recognise as “slaves”, but the alleged riches of “making a difference” drag them in every summer. Continue reading No Deathbed Conversion: My view on onshore UK gas

Will UK Shale Gas be Ugly?

A key objection to UK and European shale is that Europe is too crowded, a story any seach of this site will show I’ve addressed many times. According to the expert opinion, England’s Green and Pleasant Land could be re-industrialized thanks to shale gas, and it’s a valid question to ask. That was my immediate question when I first talked about shale here over four years ago. The debate isn’t informed by pictures of vertical wells in Wyoming and similar blots on the landscape in the parts of North America where there is a lot more landscape than here. But the Europe is too crowded for natural gas myth is prevalent and is used by those who are alleged experts (but are more interested in pushing nuclear or coal ) and those who admit their ideas of what a gas field look like comes from the movies. In our debate yesterday on Voice of Russia Radio, Vanessa Vine of Frack Free Sussex and Fiona Harvey refused to believe UK shale gas development wouldn’t look like a return to the industrial revolution. This picture of Jonah Field in Wyoming, a 1990’s tight gas field has been used by not only shale antis but also by the BBC and Telegraph. Who would want to live here? Not me for sure, but the US doesn’t all look like Wyoming, as not all the UK looks like the Cotswolds either.

Continue reading Will UK Shale Gas be Ugly?

Barclay’s on UK Shale Gas Price Impact

As I noted last week, the FOE, Caroline Lucas and Greenpeace have a habit of holding up a Deutsche Bank report from 2011 as proof  UK and European shale gas will be far off and inconsequential on price. Even Tim Yeo, who should know better, mentioned the uncertainty of European shale this morning on Radio 4 Today. 

We should ask ourselves: How truly informed can we be today if we depend on a report over a year old? Especially when the author Michael Hsueh told me on Friday:

 Granted there have been some new developments which would warrant a review

This from a Barclays Capital Commodities Research 2013 European Energy Matters report by Trevor Sikorski report is dated yesterday. Not public domain by the way, but this is the full section on the report referred to by Bloomberg today. Will Caroline and the Greenpeace gang ignore this one just as much as they ignored the DECC report on shale reserves? They will, of course. But they need to ask can they keep on doing so?:

Continue reading Barclay’s on UK Shale Gas Price Impact

DECC report on UK Shale Gas Resources

The subject of the size of the amounts of UK shale gas been open to much speculation and misunderstanding right from the start. Key opponents such as Damian Carrington of the Guardian have derided Cuadrilla’s estimates from the very start and they have been consistent in insisting that we don’t even have any gas, so why bother looking and full speed ahead, although whether that would be under wind, nuclear or coal isn’t specified. The main thing is we don’t have any gas anyway. Andrew Rawnsley famously told us the weekend previous: 

Then there is the huge hole at the heart of the frack-heads’ dream. No one even knows yet how much shale gas can be profitably extracted. Estimates of the exploitable reserves vary wildly.

The explanation is geology. Shales in Europe are generally thinner and deeper, and therefore much more expensive to tap, than those that have been successfully exploited in the United States. And Britain looks likely to be one of the less promising prospects in Europe because its shales are typically among the thinnest.

The Daily Telegraph yesterday asked the question how much gas do we actually have without getting even close to providing an answer.The discussion is complicated by basic misunderstandings of the reserve and resource figures.This definition is from the Society of Petroleum Engineers may help

Unlike the inventory of a manufacturing company, reserves are physically located in reservoirs deep underground and cannot be visually inspected or counted, but rather are estimates based on the evaluation of data that provides evidence of the amount of oil and gas present. There is no definitive answer until the end of a reservoir’s producing life. All reserve estimates involve some degree of uncertainty. The estimation of reserves volumes is generally performed by highly-skilled individuals who use their experience and professional judgment in the calculation of those volumes. 
 
Reserves represent that part of resources which are commercially recoverable and have been justified for development.
 
Meanwhile, this is the introduction to a presentation DECC made at Prospex in London last week. It hasn’t  yet been published on the DECC site, but is in the public domain and I’ve placed the full report in the NHA Library to your right.

Continue reading DECC report on UK Shale Gas Resources

Keeping the UK Lights on Reality Check

Right now is as good a time as any to understand some issues about both the UK electricity generation mix and a realistic assessment of the chances of both renewables and gas. In fact 1800 on December 12 is a really good time. Demand is likely to be one of the highest of the year. It’s the perfect electrical storm:

It’s a Tuesday – always a good demand day, better than the weekend or Friday

It’s cold: It’s not hit 0 degrees at Heathrow or most of England all day. It’s also very foggy and we’ll not get much solar gain (sunshine to most people) pouring through several millions windows.

While 85% of people use gas for central heating,  even that uses up more energy to run compressors and heat pumps. People with badly insulated homes will use electric heaters in cold spots

It’s dark.That sounds obvious, but lighting use at it’s annual peak at about 17 to 18. Everyone’s still in the office, stores are open late, restaurants are at their peak Christmas party season and of course all those decorations. Throw in that demand with the domestic peak time. Dinner’s cooking the TV’s on, the lights are on, people come home and put the heat on etc etc.

Meanwhile the food processing industry is at it’s peak.

Continue reading Keeping the UK Lights on Reality Check

Coal, CO2 and Methane: The entire facts

I’ve been meaning to do a story on recent developments in the shale gas is worse than coal for CO2 emissions story. The saga has dragged on for a couple of years and it’s time to stop it dead. Visit any anti-site in Europe, or even places which should be more responsible like The Co-op and the The Guardian, and we hear the famous Cornell Univesity says that shale gas is worse than coal story endlessly repeated. I even met the author of Bob Howarth in Brussels last year where he was telling the story, at our expense, to an EU Parliament hearing. (Before the UKIP crowd get too excited, read the story). But the problem with Howarth is that he gets the first press coverage and the several studies afterwards don’t even get a mention in the press.

This gives overworked me a chance to have a guest post from Tom Shepstone of Energy in Depth Marcellus. Why should I refute the story, when Tom has already dones so, so completely?  I spent time with Tom in the infamous Dimock, Pennsylvania earlier this year and my only regret was that I hadn’t gone there a year earlier. Just as absolultely zero is happening in Dimock apart from three people desperate for a lawsuit, the shale is worse than methane angle is one of those stories which never gets printed because only catastrophist or “controversial” shale gas stories get printed. Stories based on scientific fact just don’t make it to even the inside pages.  But here’s the complete scoop on not only Howarth, but the true big picture: Shale gas is good for the environment. It has achieved far more than than 18 years of the Kyoto Treaty. Heres the proof:

Continue reading Coal, CO2 and Methane: The entire facts

Actual CO2 reductions. Not Hot Air.

I should be the last one to tell the WWF UK, Friends of the Earth -UK and Greenpeace UK, but they need not only to stop fighting gas but to start thinking globally. The Doha Climate round is ending this week and what has it accomplished? As little as the rest of the Kyoto Process. Insanity is repeating the same actions and expecting a different result, just as they have in the last 18 conferences.

Increasingly the main objection the UK arms of the Green NGO’s can muster against shale gas is that we won’t meet the Committee on Climate Change targets for either percentage of electricity from renewable sources or a longer term 80% decarbonisation of the electricity and heat sectors by 2050.The GNGO’s  need to ask themselves what is truly important ?  Climate Change or the Committee on Climate Change?  They are losing sight of the results gas can achieve in cutting huge swathes of carbon on a global basis From that we no longer need such high targets in the UK.  It doesn’t mean John Gummer is a bad person. It just simply means that reality has changed.  Sadly, the obsession with local targets to solve a global problem solves nothing. 

Nothing illustrates this more than a chart published this week from the US Energy Information Administration. The US didn’t sign the Kyoto Accords  Yet, thanks primarily to natural gas but also due to significant efficiency improvements in transport, the US is exceeding the targets it would have been given:

Continue reading Actual CO2 reductions. Not Hot Air.

Steel Yourself: UK Shale Gas and the Steel Industry

As we wait for the starters gun to fire this week, let’s consider the impact of shale gas, or not, on the steel industry. Steel is one of those energy intensive precursor industries like chemicals and cement, that would get a double shot of help from shale gas, via increased demand and lower energy costs. Or at least they could in some countries. In France this week we had Minister of Industrial Renewal Armand Montebourg  getting in a big ruckus with Arcelor Mittal over  job losses. The story by weeks end had even reached this boss:

The socialist government of France and ArcelorMittal reached a peace deal in their bitter dispute over the future of one of the steelmaker’s French plants on Friday night, averting the threat by Paris to nationalise the operations.

The accord included concessions by both sides after a week of rancorous relations following a furious outburst by Arnaud Montebourg, the leftwing industry minister, against the company, headed by billionaire, Lakshmi Mittal.

Each shale gas well needs anywhere from three to ten kilometers of high grade steel tube. Using a mid range length of 6 kilometers of steel on a mid range estimate of 600 well in Lancashire that makes 3600 kilometers of steel.  Where is Tata Steel in the UK and Arcelor Mittal in France in the shale debate? Shale’s fight is their fight, but both companies have been notably absent from any lobbying for shale gas. In that they have been joined by most of British Industry, who represented poorly by the CBI, have until now swallowed the Green Growth story. I suggest they get with the shale program before they fall even further back.

Continue reading Steel Yourself: UK Shale Gas and the Steel Industry

NY Times, Cuadrilla & DECC on UK shale

Maybe this is one way of getting the UK press to write a proper story on shale. Generally you can expect the UK press to print a story from the New York Times weeks later, usually prefacing it with the dated and childish “exclusive” tag loved by the UK press. From the IHT today:

Just outside Blackpool, a town of faded cabarets and amusement rides on the Irish Sea, a drilling rig sits in a muddy farm field. The big white and yellow machine represents the latest attempt by Cuadrilla Resources to see if it can bring Northwest England the sort of shale gas revolution that has transformed the U.S. energy picture.

 Cuadrilla’s chief executive, Francis Egan, who joined the company four months ago after a career spent in the international oil industry at giants like Marathon and BHP Billiton, says that Cuadrilla believes there is 200 trillion cubic feet of gas beneath the company’s 900-square-kilometer, or 348-square-mile, concession in the area.

 “That is a huge amount of gas,” he says. Even if only 10 percent were extractable, it would be enough to fuel Britain’s current consumption for about seven years.

That is of course,  rather dated estimates but Cuadriilla want to be conservative ahead of the actual projections that are coming over the next few weeks. The Guardian thinks even the present estimates are ludicrous on the basis of one report from Deutsche Bank, later updated but still never corrected by the Guardian. The FT thinks 10% won’t change anything, although as I have pointed out for over a year, even the conservative figure is almost current North Sea production. But even ten percent is equal to 1 TCF of production per year for twenty years, which is equal to 28.3 Billion Cubic Metres, enough to totally replace and more last year’s imports of 25.4 BCM of LNG. At the current  60 pence per therm for gas, that is 21.4 pence per cubic metre or over £6 billion pounds. Another way at looking at the “controversial” shale gas is that it takes £6BN off the balance of payments and allows the UK  to tax it at 62% tax and royalty, instead of keeping the Qataris in Ferraris. Or to be exact, Lamborghinis:

Continue reading NY Times, Cuadrilla & DECC on UK shale