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Ah Yes..........we were told "Not to worry" about the rapid fall in Northsea production..........Uk Shale would repace it........the Oil majors are about to jump in..........it seems Not.
Shell shuns UK shale gas industry
Royal Dutch Shell has crushed any hopes it might kickstart a British shale gas boom, saying nobody knows whether shale will succeed in the UK and it has no desire to be the company that tries to find out.
“Do we want to be first in and be in the headlines every day in the UK? Well, your answer is: we are not,” Mr Henry said. Photo: Getty Images
By Emily Gosden
10:12PM BST 02 May 2013
51 Comments
In a blow to Government attempts to attract investment to the controversial industry, Simon Henry, Shell’s chief financial officer, said it had already allocated more than $6bn (£3.8bn) to shale globally and was not going to exceed that sum.
“We have a successful and growing business in North America, we have great opportunities in China, Ukraine and Russia,” he said. “The UK has to compete directly with them and right now nobody even knows whether the gas will flow.”
“Do we want to be first in and be in the headlines every day in the UK? Well, your answer is: we are not,” he said.
Ministers hope domestic shale gas could help lower energy prices, replicating a boom that has transformed the US energy landscape.
They are planning tax breaks to entice shale gas developers, as well as sweeteners such as discounted energy bills for communities affected by fracking, the controversial process used to extract shale gas.
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A handful of small companies such as Cuadrilla and IGas have led the charge in the UK shale industry and reports have suggested supermajors such as Shell may swoop.
Just a year ago Mr Henry struck a more positive tone,saying unproven estimates of UK shale suggested there could be significant reserves in Shell’s “backyard”, in which it “ought to be interested”.
But on Thursday he said Shell had “much higher priorities, and more attractive opportunities” elsewhere.
“We are not going to just throw more strategic capital allocation into the business because the UK, or any other country for that matter, feels it’s a good thing,” he said. “If and when the UK reaches the same level of potential attractiveness, we’ll give it a thought.”
There was “almost certainly a lot of shale gas in Europe including in the UK” but it was not yet known how much, how easily it would flow from the ground, or the societal and fiscal challenges of extracting it.
Ken Cronin, chief executive of the UK Onshore Operators Group, the representative body for the UK onshore oil and gas industry, said: “The next couple of years are very important in terms of being able to put a number of wells into the ground. Then we will be able to work out what is technically and economically recoverable. In the US smaller companies started the process off and that’s the same as is happening in the UK.”
The industry is awaiting the publication of a British Geological Survey report that is expected to significantly increase the estimate of the UK’s shale resources. Even if only a tenth can be extracted, experts say it could be enough to heat every home for 100 years.
Dart Energy, another UK shale player, is looking for partners to take a stake. Andrew Monk, chief executive of VSA Capital, lead broker to Dart, said: “It would be fair to say they have had a lot of interest.”
It was natural that "supermajors" such as Shell would look to bigger shale plays elsewhere, with the likes of British Gas owner Centrica more likely to enter the UK industry, he said.
“I think it will be huge in the UK. It probably won't bring our energy bills down but it will stop them going through the roof.”
Shell shuns UK shale gas industry
Royal Dutch Shell has crushed any hopes it might kickstart a British shale gas boom, saying nobody knows whether shale will succeed in the UK and it has no desire to be the company that tries to find out.
“Do we want to be first in and be in the headlines every day in the UK? Well, your answer is: we are not,” Mr Henry said. Photo: Getty Images By Emily Gosden
10:12PM BST 02 May 2013
51 Comments In a blow to Government attempts to attract investment to the controversial industry, Simon Henry, Shell’s chief financial officer, said it had already allocated more than $6bn (£3.8bn) to shale globally and was not going to exceed that sum.
“We have a successful and growing business in North America, we have great opportunities in China, Ukraine and Russia,” he said. “The UK has to compete directly with them and right now nobody even knows whether the gas will flow.”
“Do we want to be first in and be in the headlines every day in the UK? Well, your answer is: we are not,” he said.
Ministers hope domestic shale gas could help lower energy prices, replicating a boom that has transformed the US energy landscape.
They are planning tax breaks to entice shale gas developers, as well as sweeteners such as discounted energy bills for communities affected by fracking, the controversial process used to extract shale gas.
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26 Mar 2012
A handful of small companies such as Cuadrilla and IGas have led the charge in the UK shale industry and reports have suggested supermajors such as Shell may swoop.
Just a year ago Mr Henry struck a more positive tone,saying unproven estimates of UK shale suggested there could be significant reserves in Shell’s “backyard”, in which it “ought to be interested”.
But on Thursday he said Shell had “much higher priorities, and more attractive opportunities” elsewhere.
“We are not going to just throw more strategic capital allocation into the business because the UK, or any other country for that matter, feels it’s a good thing,” he said. “If and when the UK reaches the same level of potential attractiveness, we’ll give it a thought.”
There was “almost certainly a lot of shale gas in Europe including in the UK” but it was not yet known how much, how easily it would flow from the ground, or the societal and fiscal challenges of extracting it.
Ken Cronin, chief executive of the UK Onshore Operators Group, the representative body for the UK onshore oil and gas industry, said: “The next couple of years are very important in terms of being able to put a number of wells into the ground. Then we will be able to work out what is technically and economically recoverable. In the US smaller companies started the process off and that’s the same as is happening in the UK.”
The industry is awaiting the publication of a British Geological Survey report that is expected to significantly increase the estimate of the UK’s shale resources. Even if only a tenth can be extracted, experts say it could be enough to heat every home for 100 years.
Dart Energy, another UK shale player, is looking for partners to take a stake. Andrew Monk, chief executive of VSA Capital, lead broker to Dart, said: “It would be fair to say they have had a lot of interest.”
It was natural that "supermajors" such as Shell would look to bigger shale plays elsewhere, with the likes of British Gas owner Centrica more likely to enter the UK industry, he said.
“I think it will be huge in the UK. It probably won't bring our energy bills down but it will stop them going through the roof.”
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