Unlocking the opportunity for Britain
Gas meets 40% of the UK’s primary energy requirements. Today we import roughly 50% of that gas requirement, and by 2035 that figure is expected to rise to nearly 75%. Imported gas costs us around £18 million a day. According to one National Grid scenario, Britain’s import bill could hit £10 billion a year – creating no jobs and generating no tax revenue in this country, but offshores these benefits instead to countries including Norway, Qatar and Russia.
Dependency on imports leaves the UK dangerously exposed to shortages and price spikes when there are infrastructure failures or tight international supplies. On March 1st 2018, National Grid issued its first “gas supply deficit” warning for eight years. A number of large businesses agreed with their suppliers to use less gas, and within-day prices rose to as high as 350 pence per therm – over six times the normal price. This inevitably hits our industrial competitiveness, pushes up costs for our gas-dependent manufacturing industries, creates risks for business and increased prices for consumers, all while hitting household energy bills.
There may be plenty of gas that can be imported from around the world but that comes at a cost, not just a high financial one but imports have a higher carbon footprint and we cannot control employment and environmental policies and regulations in other jurisdictions. If we develop our own home-grown supply we can maximise both the economic and environmental opportunities that come with it and have more security of supply.
Technological innovations can unlock untapped resources that have the potential to contribute to Britain’s energy independence for generations to come. By combining our considerable experience in onshore exploration with a proven commitment to safety and the environment, IGas is positioned to help unlock this national resource, delivering direct benefits to local communities as well as making a significant contribution to our economy and energy diversity at a national scale.
According to the EY report, "Getting Ready for Shale Gas", commissioned by UKOOG, the potential opportunities include:
• UK-based oil field service and manufacturing companies providing specialised equipment and skills for hydraulic fracturing totally £17bn
• A £4.1bn waste, storage and transportation requirement
• A £2.3bn steel requirement in Britain
• The potential for a new £1.65bn rig manufacturing industry
• A new market for existing British businesses
• A 64,500 jobs opportunity and a requirement to grow skills
There is a large body of evidence suggesting that natural gas from shale is a significant asset for Britain that can be extracted cleanly and safely. According to figures from the Institute of Directors (IoD), Britain’s shale gas reserves could supply a third of our annual gas needs and IGas believes that within its own licence area, covering 300 square miles between Manchester and Liverpool, there is likely to be in the region of 102 Tcf of shale gas. With Britain's total gas use running at 3 Tcf a year, it is clear this is a significant national resource.
At this stage, IGas and other producers need to appraise this resource and understand the proportion of natural gas that is safely recoverable. But even if only ten percent of the gas can be extracted it would still have the potential to make a significant contribution to the UK economy, through tax revenues, more jobs and greater energy security.
Uses of Natural Gas
Gas provides 84% of our homes with heat, 61% with the means to cook, up to 50% of our electricity and the employment of over half a million people in industries that turn natural gas into everyday products such as computers, mobile phones, cosmetics, medicines, fertilisers for food production and even solar panels.