I originally posted this on March 11 2010. 4 months before Channel 4 and 10 months before the Radio 4Today show.
So what about the mysterious Cuadrilla Resources mentioned earlier this week in our E+P link?
In the Netherlands, Cuadrilla Resources was recently awarded a license on the margin of the London-Brabant High and West Netherlands Sub-basin of the Anglo-Dutch Basin. The Epen Formation shale (Namurian) is likely the primary target in this location. Cuadrilla Resources, through its Bowland Resources subsidiary, also has interests in the Cheshire Basin in northwest England. Spudding in March 2010, the company’s Preese Hall 1 well will test the Namurian-age Bowland Shale. The depth to top shale is estimated at 4,300 ft (1,312 m) with a gross prognosed shale thickness of some 4,000 ft (1,220 m). This well is the first known test of the Carboniferous shale gas play in Europe.”
Cuadrilla is hiding out in Lichfield, Stafordshire, not exactly a center of world energy finance. They don’t even have a web site. But who needs to have a fancy office, when you can have two very influential and deep pocketed hedge funds backing you?
Riverstone for example
Riverstone/Carlyle Global Energy and Power Funds, a group of energy-focused private equity funds managed by Riverstone Holdings LLC, has committed to subscribe US$58.0 million for equity in Cuadrilla Resources Holding Ltd, the holding company established by Lucas to hold its investment for unconventional hydrocarbons exploration and development in Europe.
Cuadrilla is now well capitalised with sufficient resources and the ability to fund its drilling and exploration program for the next three years. The board of Cuadrilla will comprise three representatives from each of Lucas and Riverstone, with two representatives from management.
Allan Campbell, CEO and Chairman of Lucas, said: “With Stage 1 of the Cuadrilla Business Plan now completed, we are very pleased to have an investor of Riverstone’s standing join us to assist in the next stage of Cuadrilla’s development. Riverstone already has a significant investment portfolio in the energy and power industries. This network of strategic relationships together with Riverstone’s substantial financial resources will be of considerable benefit to Cuadrilla.
“Cuadrilla has acquired an extensive portfolio of highly prospective acreage throughout Europe. With continuing advances in drilling and fraccing technology, we have high expectations of proving up this acreage.”
Riverstone has John Browne of BP on the board besides others, but they are small fry compared to The Carlyle Group
The Carlyle Group is a global private equity investment firm, based in Washington, D.C., with more than $84.5 billion of equity capital under management, diversified over 64 different funds as of March 31, 2009. The firm operates four fund families, focusing on leveraged buyouts, growth capital, real estate and leveraged finance investments. The firm employs more than 890 employees, including 495 investment professionals in 20 countries with several offices in the Americas, Europe, Asia and Australia; its portfolio companies employ more than 415,000 people worldwide. Carlyle has over 1300 investors in 71 countries.
Carlyle was ranked as the largest private equity firm in the world, according to a ranking called the PEI 50 based on capital under management.
The Carlyle Group has had not one but both President George Bush’sinvolved along with small fry such as John Major, James Baker, two former Thai Prime Ministers, former US Defense Secretary Carlucci etc etc. And Olivier Sarkozy half-brother of the French President. Michael Moore even alleged the Bin Laden family was involved. On a positive note, they also own Dunkin Donuts.
The point being of course that are serious money. Now it could be that $58 million out of $85 billion means only back of the sofa money or that the chairman of Cuadrilla sat next to someone at dinner and it was his lucky night. Or could they be on to something? Alistair Buchanan thinks shale gas is no big deal and John Dizard of the FT think it’s all a big con. But AJ Lucas is huge in Australian infrastructure, including Gorgon LNG and pipeline and CBM amongst other things. Amateurs, they aren’t.
So where is all this money going? Down a hole, not in Blackburn Lancashire, but close enough. Preese Hall Farm is in Fylde, near Blackpool.
This is what Cuadrilla said in the Plannng Application:
According to E+P, this is the first Carboniferous Shale Gas Play in Europe. The area is in the same geological area as Centrica’s Morecambe Bay gas field. A lot has changed in shale technology since BG found the gas uneconomic in 1999. This could be big. Maybe it will be a bust. But all those influential people sure seem to be keeping Alistair Buchanan of Ofgem out of the loop.
A few years back Blackpool in NW England tried to revive itself by seeking to be the site of casino. They lost that one, but with big players coming to put money on the table, they could still be in the money.