Fracking could trigger a £33bn investment bonanza and create 64,000 jobs, promises a new report for the shale industry released on Thursday and part-funded by government.
The spending would go on 50 new land-based drilling rigs, 8,000 miles of steel casing and hundreds of pumps needed over a 16-year period to 2032, according to Ernst & Young who produced the report.
Michael Fallon, the business and energy minister, said the study highlighted the "huge prize" at stake for the UK in terms of manufacturing while he went on to promise £2m of spending on developing new technology.
But Greenpeace described the predictions based on 4,000 wells being drilled as a "rehash of rose-tinted industry guesstimates" and questioned why public money was spent on funding the report and new techniques.
The review, Getting Ready for UK shale gas, published at a supply chain conference in Blackpool, says the bulk of the spending (£17bn) would go on specialised equipment and skills for fracking, a controversial technique using chemicals for breaking up shale rock to release hydrocarbons.
A further £4.1bn would go on "waste, storage and transportation" with a further £2.3bn on steel with the estimate of 64,000 jobs based on direct and indirect positions created.
But the report also urged the oil and gas industry to start investing immediately to prevent shale gas supply and skill bottlenecks building up across the supply sector.
Fallon promised £2m of public cash to encourage the development of new technology to help the shale industry while insisting fracking can be undertaken within a wider framework of curbing carbon emissions.
"Shale gas has the potential to kickstart a whole new industry, building on the world leading expertise the UK already has in the energy sector.
There will be significant opportunities across the steel, manufacturing and engineering industries as shale develops," he said.
Fallon also said he would look at the issue of whether landowners could legally prevent horizontal shale wells being drilled under their land.
He told the BBC's Today programme: "I hope we can clear this up very quickly, because we want to encourage shale gas; we want to make sure it's done responsibly.
Again, it's going to require local planning permission, but there shouldn't really be any doubt as to whether you've got permission to go under somebody's land or not – we do want to clarify that."
Doug Parr, the chief scientific officer for Greenpeace UK, which has encouraged landowners to exercise their rights to halt drilling, was scathing about the Ernst & Young report: "Paying accountants to tally up hypothetical jobs won't change the fact that executives still have no idea whether they'll actually be able to get gas out of the ground on a commercial scale in the UK."
He added: "Scratch beneath the hype and this report is actually a veiled plea for government and taxpayer support for an industry that has stalled before even taking off. It's less about what fracking can do for your country, and more about what your country should do for fracking."
The Institute of Directors (IoD), which has produced a number of its own optimistic forecasts on shale in the past, said the Ukraine crisis highlighted the importance of securing Britain's energy security.
The employer's organisation said it was "disappointed" that progress to date had been so slow with exploiting shale.
Dan Lewis, senior policy adviser at the IoD, said: "Despite the government's positive move to change our archaic trespass laws, there are still many costly delays facing the industry.
Having to wait six-eight years after receiving a licence to start commercial production is far too long. Until we streamline the process and end the tick-box culture, we will continue to put off investors."
theguardian.com
The spending would go on 50 new land-based drilling rigs, 8,000 miles of steel casing and hundreds of pumps needed over a 16-year period to 2032, according to Ernst & Young who produced the report.
Michael Fallon, the business and energy minister, said the study highlighted the "huge prize" at stake for the UK in terms of manufacturing while he went on to promise £2m of spending on developing new technology.
But Greenpeace described the predictions based on 4,000 wells being drilled as a "rehash of rose-tinted industry guesstimates" and questioned why public money was spent on funding the report and new techniques.
The review, Getting Ready for UK shale gas, published at a supply chain conference in Blackpool, says the bulk of the spending (£17bn) would go on specialised equipment and skills for fracking, a controversial technique using chemicals for breaking up shale rock to release hydrocarbons.
A further £4.1bn would go on "waste, storage and transportation" with a further £2.3bn on steel with the estimate of 64,000 jobs based on direct and indirect positions created.
But the report also urged the oil and gas industry to start investing immediately to prevent shale gas supply and skill bottlenecks building up across the supply sector.
Fallon promised £2m of public cash to encourage the development of new technology to help the shale industry while insisting fracking can be undertaken within a wider framework of curbing carbon emissions.
"Shale gas has the potential to kickstart a whole new industry, building on the world leading expertise the UK already has in the energy sector.
There will be significant opportunities across the steel, manufacturing and engineering industries as shale develops," he said.
Fallon also said he would look at the issue of whether landowners could legally prevent horizontal shale wells being drilled under their land.
He told the BBC's Today programme: "I hope we can clear this up very quickly, because we want to encourage shale gas; we want to make sure it's done responsibly.
Again, it's going to require local planning permission, but there shouldn't really be any doubt as to whether you've got permission to go under somebody's land or not – we do want to clarify that."
Doug Parr, the chief scientific officer for Greenpeace UK, which has encouraged landowners to exercise their rights to halt drilling, was scathing about the Ernst & Young report: "Paying accountants to tally up hypothetical jobs won't change the fact that executives still have no idea whether they'll actually be able to get gas out of the ground on a commercial scale in the UK."
He added: "Scratch beneath the hype and this report is actually a veiled plea for government and taxpayer support for an industry that has stalled before even taking off. It's less about what fracking can do for your country, and more about what your country should do for fracking."
The Institute of Directors (IoD), which has produced a number of its own optimistic forecasts on shale in the past, said the Ukraine crisis highlighted the importance of securing Britain's energy security.
The employer's organisation said it was "disappointed" that progress to date had been so slow with exploiting shale.
Dan Lewis, senior policy adviser at the IoD, said: "Despite the government's positive move to change our archaic trespass laws, there are still many costly delays facing the industry.
Having to wait six-eight years after receiving a licence to start commercial production is far too long. Until we streamline the process and end the tick-box culture, we will continue to put off investors."
theguardian.com
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