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| IGas signs £30m shale gas deal with Ineos to expand | IGas signs £30m shale gas deal with Ineos to expand |
| (35 minutes later) | |
| UK shale giant IGas has signed a £30m gas deal with Switzerland's Ineos in a tie-up meant to expand IGas's exploration efforts. | |
| The deal will give Ineos access to sites beyond the ones it currently operates in Scotland. | The deal will give Ineos access to sites beyond the ones it currently operates in Scotland. |
| Ineos has also pledged an additional £138m to help IGas expand its shale gas operations in the North West and East Midlands regions in England. | Ineos has also pledged an additional £138m to help IGas expand its shale gas operations in the North West and East Midlands regions in England. |
| Shares in IGas surged by more than 20% on news of the agreement. | Shares in IGas surged by more than 20% on news of the agreement. |
| Investors had worried about the strength of the firm, as the price of oil fell by more than half over the past year. | Investors had worried about the strength of the firm, as the price of oil fell by more than half over the past year. |
| The deal also gives IGas another major partner. The UK onshore oil producer is already working with Total of France and GDF Suez. | The deal also gives IGas another major partner. The UK onshore oil producer is already working with Total of France and GDF Suez. |
| "Alongside the commitment from our existing partners, Ineos's commitment of upfront cash and considerable capital investment will help fund us through the next steps of our shale appraisal and production programme," said Andrew Austin, chief executive of IGas, in a statement. | "Alongside the commitment from our existing partners, Ineos's commitment of upfront cash and considerable capital investment will help fund us through the next steps of our shale appraisal and production programme," said Andrew Austin, chief executive of IGas, in a statement. |
| Scotland stake | Scotland stake |
| Last year, Ineos said it planned to invest $1bn (£663m) in British shale gas exploration, in an effort to emulate the shale boom that has led to cheap oil prices in the US. | Last year, Ineos said it planned to invest $1bn (£663m) in British shale gas exploration, in an effort to emulate the shale boom that has led to cheap oil prices in the US. |
| Ineos - which is privately owned - said that as part of this latest deal, it will acquire IGas's stake in the shale licence around the Grangemouth petrochemical plant, which will give the Swiss firm full ownership of the site. | Ineos - which is privately owned - said that as part of this latest deal, it will acquire IGas's stake in the shale licence around the Grangemouth petrochemical plant, which will give the Swiss firm full ownership of the site. |
| Analysis: John Moylan, industry correspondent | Analysis: John Moylan, industry correspondent |
| Ineos wants to become the biggest shale gas player in Britain. | Ineos wants to become the biggest shale gas player in Britain. |
| It could achieve that accolade soon. | It could achieve that accolade soon. |
| On top of this deal its also applied for more blocks as part of the ongoing 14th onshore licensing round. | On top of this deal its also applied for more blocks as part of the ongoing 14th onshore licensing round. |
| And to overcome objections to fracking it's offering local communities 6% of the revenues from the shale gas it produces. | And to overcome objections to fracking it's offering local communities 6% of the revenues from the shale gas it produces. |
| In a statement, Gary Haywood, the chief executive of Ineos Upstream, said: "This is a further significant step for Ineos in its plan to become the biggest player in the UK shale gas industry. | In a statement, Gary Haywood, the chief executive of Ineos Upstream, said: "This is a further significant step for Ineos in its plan to become the biggest player in the UK shale gas industry. |
| "We believe shale gas could revolutionise UK manufacturing and Ineos has the resources to make it happen, the skills to extract the gas safely, and the vision to realise that everyone must share in the rewards for UK shale gas to be successfully developed." | "We believe shale gas could revolutionise UK manufacturing and Ineos has the resources to make it happen, the skills to extract the gas safely, and the vision to realise that everyone must share in the rewards for UK shale gas to be successfully developed." |
| The plan to develop the Grangemouth site, however, is complicated by Scotland's current moratorium on fracking - the method Ineos would use to extract oil from the site. | The plan to develop the Grangemouth site, however, is complicated by Scotland's current moratorium on fracking - the method Ineos would use to extract oil from the site. |
| Fracking, or hydraulic fracturing, involves pumping a mixture of water and chemicals into shale rock at high pressure to extract gas and oil. | Fracking, or hydraulic fracturing, involves pumping a mixture of water and chemicals into shale rock at high pressure to extract gas and oil. |
| Environmental campaigners claim the process encourages reliance on fossil fuels instead of promoting investment in renewable energy sources. | Environmental campaigners claim the process encourages reliance on fossil fuels instead of promoting investment in renewable energy sources. |
| Proponents of the process say it unlocks huge deposits of oil and natural gas, increases a country's energy security and boosts the economies of the areas in which it takes place. | Proponents of the process say it unlocks huge deposits of oil and natural gas, increases a country's energy security and boosts the economies of the areas in which it takes place. |