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| iGas: shale gas resource higher than previously thought | |
| (about 1 hour later) | |
| Estimates of shale gas resources by the energy company iGas are considerably higher than previously thought, it announced on Monday. | |
| Studies by the company show its licensed sites in north-west England hold between 15 and 170 trillion cubic feet of shale gas – with a most likely scenario of 102 tr cubic feet – in an area covering 300 square miles of Cheshire. It had previously forecast over 9 tr cubic feet; the UK uses around 3 tr cubic feet of gas a year. Only a fraction of the resource will be recoverable. | |
| iGas said its estimates could mean reduced reliance on imported gas for the UK. Andrew Austin, iGas's chief executive, said that the study supports their view that "these licences have a very significant shale gas resource with the potential to transform the company and materially benefit the communities in which we operate". | iGas said its estimates could mean reduced reliance on imported gas for the UK. Andrew Austin, iGas's chief executive, said that the study supports their view that "these licences have a very significant shale gas resource with the potential to transform the company and materially benefit the communities in which we operate". |
| The announcement comes after promises by the chancellor, George Osborne, to give tax breaks to the shale gas industry, and the lifting of restrictions last December on the controversial practice of "fracking" – hydraulically fracturing shale rock to extract the gas. | The announcement comes after promises by the chancellor, George Osborne, to give tax breaks to the shale gas industry, and the lifting of restrictions last December on the controversial practice of "fracking" – hydraulically fracturing shale rock to extract the gas. |
| Rival shale gas firm Cuadrilla, which has the former BP boss Lord Browne on its board, said in 2011 that it estimated its own resources at 200 tr cubic feet. Its chief executive, Mark Miller, said at the time that 10-30% of that would likely be extracted. | |
| The new estimates from iGas were met with scepticism from green groups, which have opposed the development of shale gas in the UK partly on the grounds that it would squeeze out investment in renewable energy. | The new estimates from iGas were met with scepticism from green groups, which have opposed the development of shale gas in the UK partly on the grounds that it would squeeze out investment in renewable energy. |
| Doug Parr, Greenpeace chief scientist and policy director, said: "Deciding how much gas there is based on the word of a shale gas firm is like buying a secondhand car without lifting up the bonnet and asking the price. iGas may be keen to impress its investors in China but these figures are just hype. The world's largest oil and gas firms were attracted to Poland by similar claims - now they are rushing to leave." | Doug Parr, Greenpeace chief scientist and policy director, said: "Deciding how much gas there is based on the word of a shale gas firm is like buying a secondhand car without lifting up the bonnet and asking the price. iGas may be keen to impress its investors in China but these figures are just hype. The world's largest oil and gas firms were attracted to Poland by similar claims - now they are rushing to leave." |
| iGas plans to conduct exploratory drilling later this year to further refine the estimates. | iGas plans to conduct exploratory drilling later this year to further refine the estimates. |
| An independent study of shale gas reserves in the UK is currently being compiled by the British Geological Survey for the Department of Energy and Climate Change, and is expected to be published soon. | An independent study of shale gas reserves in the UK is currently being compiled by the British Geological Survey for the Department of Energy and Climate Change, and is expected to be published soon. |
| Shares in IGas rose to a four-month high of 107.5p on Monday morning, and were trading 8.6% higher at 101p by 8am GMT. | Shares in IGas rose to a four-month high of 107.5p on Monday morning, and were trading 8.6% higher at 101p by 8am GMT. |