UK shale gas resources ‘could be three times demand’

A report published by the government suggests there could be between 4.32–8.64 trillion cubic feet of shale resources to be developed in the UK.

The Strategic Environmental Assessment (SEA) report, produced by AMEC, sets out the potential economic and environmental effects of further oil and gas activity in Great Britain, including shale oil and gas production, comparing a ‘low activity’ and ‘high activity’ scenario.

The assessment was carried out in preparation for the launch of the next round of licenses being made available for onshore oil and gas exploration and production.

A consultation will now run until March to consider the findings of the SEA and how this affects shale gas production in the UK.

In a statement energy minister Michael Fallon said: ‘There could be large amounts of shale gas available in the UK, but we won’t know for sure the scale of this prize until further exploration takes place. It is an exciting prospect, which could bring growth, jobs and energy security.’

The ‘high activity scenario’ in the SEA assumes that a substantial amount of shale gas is produced during the 2020s, (4.32–8.64 trillion cubic feet), which is up to three times current gas demand in the UK.

Under this scenario, there would be beneficial impacts to the economy, jobs and communities. Employment in the oil and gas industry could be increased by seven per cent, with 16,000 – 32,000 full-time jobs created.

Local economies would benefit from receiving an initial contribution of £100,000 per hydraulically fractured site. They could then receive a further one per cent of the revenue of each well over its lifetime. Almost £1bn could be paid out across the UK under a ‘high activity’ scenario.

High levels of shale gas production could however have some potentially adverse impacts on the environment and communities, including an increase in traffic congestion, emissions and more pressure on water resources. The SEA notes that existing regulatory controls, including the planning system, should ensure that any adverse impacts are minimised.

Government, which has also set out a series of permits and permissions developers require prior to drilling, will consider all responses to the SEA before any decision is made on further onshore licensing.