The UK could reconsider its 2019 moratorium on fracking as it is leaving “all options on the table” to boost its domestic oil and gas supply and reduce dependence on foreign energy in the wake of Russia’s invasion of Ukraine.
At the end of 2019, the UK government ended its support for fracking following a report from the authority supervising the oil and gas industry that “it is not possible with current technology to accurately predict the probability of tremors associated with fracking.”
Cuadrilla Resources, the company operating Britain’s only two shale gas wells at Preston New Road near Blackpool in Lancashire, had to stop drilling after the government announced the moratorium on fracking “until compelling new evidence is provided.”
The moratorium may have stayed in place for many more years—or forever—were it not Putin’s war in Ukraine, the skyrocketing energy prices, the cost-of-living crisis in the UK due to a major hike in energy bills, and the West’s resolve to wean off Russian oil and gas supply as soon as possible.
The UK has already said that it would phase out Russian oil imports by the end of this year and that Russian gas accounts for less than 4 percent of Britain’s supply.
However, domestic gas supply from the UK North Sea has been falling in recent years, and the offshore industry body, OEUK, warned last week that without new investment, by 2030 around 80 percent of UK gas supplies and more than 70 percent of oil will have to be sourced abroad. For the first time ever, the UK North Sea is now no longer the primary gas supplier, being outstripped by Norway. At the same time, gas is still the UK’s largest energy source, supplying 43 percent of total UK energy last year, OEUK said.
In its efforts to secure energy—and therefore, national—security, the UK is not overlooking any potential additional domestic resource, including shale gas, the government said after Russia invaded Ukraine.
“In response to Putin’s barbaric acts in Ukraine and against the Ukrainian people, we need to keep all of our energy options open,” Greg Hands, the UK’s Minister of State for Energy, Clean Growth and Climate Change, said last month, although he noted that fracking is not the solution to near-term price volatility and energy shortages.
Then this week, the government commissioned the British Geological Survey to advise on the latest scientific evidence around shale gas extraction.
“Ministers have always been clear that the exploration of shale gas reserves in England could only proceed if the science shows that it is safe, sustainable and of minimal disturbance to those living and working nearby,” the government said on Tuesday.
The report, expected before the end of June this year, will be for the cabinet to see “if any progress has been made in the scientific understanding which underpins government policy, and to allow ministers to consider next steps.”
“It remains the case that fracking in England would take years of exploration and development before commercial quantities of gas could be produced for the market, and would certainly have no effect on prices in the near term,” Business and Energy Secretary Kwasi Kwarteng said.
“However, there will continue to be an ongoing demand for oil and gas over the coming decades as we transition to cheap renewable energy and new nuclear power. In light of Putin’s criminal invasion of Ukraine, it is absolutely right that we explore all possible domestic energy sources,” Kwarteng added.
A few days earlier, the North Sea Transition Authority (NSTA), the supervisory body for the oil and gas industry, lifted an order requiring Cuadrilla to plug and abandon the country’s two remaining horizontal shale gas wells. The authority has given the company until July 2023 to evaluate whether it could extract gas safely and provide an alternative energy supply from the two sites in Lancashire.
Commenting on the government’s request for a report on shale gas, Cuadrilla’s CEO Francis Egan commented, “The Government clearly recognises the huge potential that shale gas offers this country, and this review may be a tentative first step towards overturning the moratorium and exploiting that potential.”
Possible shale gas extraction in the UK is years away, at best, considering the strong local opposition to fracking, and to all oil exploration, for that matter. Yet, it could be another domestic resource of gas supply on top of the UK North Sea at a time when the West is prioritizing energy security.
By Tsvetana Paraskova for Oilprice.com
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