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Page added on May 25, 2014
UK to hush fracking victims with $1.35mn as vast new reserves uncovered
The UK government will attempt to buy off communities by increasing compensation for fracking operations after announcing plans to deny them the use of trespass laws. This comes just as several more billion barrels of oil were found in southern England.
Ministers will propose that 800,000 pounds (US$1,350,000) on average will be added on top of the existing program, under which a lump sum of 100,000 pounds ($168,620) and 1 percent of revenues are paid out to affected communities when a test well is turned on, British media report.
The new figure is a result of cumulative payments announced by the Department of Energy and Climate for lateral wells built around existing sites.
The plan is to have 10 wells on average at each site with an additional four lateral wells.
The initiative appears to be a move to reach out to homeowners disgruntled with the fact that trespass laws will not apply to the oil industry. That is a big win for energy companies, however.
The report detailing the big find will be released on Friday. Its authors at the British Geological Survey (BSG) are expected to announce somewhere around 1,300 trillion cubic feet of shale gas reserves in the counties of Kent, Sussex, Surrey and Hampshire. But the task of analyzing whether the extraction is economically viable is yet to be undertaken. The BSG has already found large shale gas reserves in the north.
Despite the report’s findings, other new research has suggested that Britain will run out of oil, gas and coal within five years. And so will neighboring France – and Italy, which has less than a year of oil left. Russia is currently among the biggest oil giants in the world, with 50 years of oil, 100 years of gas and more than 500 years of coal.
The Conservative government largely supports Britain’s hydraulic fracturing initiatives, with ministers claiming that it will reduce the cost of energy and create thousands of new jobs.
To facilitate the process they will be introducing new trespass laws exempting them from prosecution. Until now companies have been extremely cautious getting their hands on those vast reserves because of existing trespass legislation, according to the Times. Only one homeowner could make a case drag on for years. This is different from other industries, which get access underground by default.
Environmental activists are strongly opposed to the technique, which has already been proven to cause small earthquakes in the US. A number of studies have also revealed water pollution, and the practice has also been linked to health problems, including birth defects in unborn infants in the US.
The activists also believe fracking will accelerate the process of man-made climate change.
Further to this, regional activist Brenda Pollack believes that such a vast amount of shale gas as was found in the south will only disfigure a beautiful part of the country.
“These latest estimates will set alarm bells ringing across the South East of England where fracking firms seem intent on punching holes in some of Britain’s most beautiful countryside in the search for profits,” she told ITV.
Similarly, Caroline Lucas of the Green Party believes the government’s claims about lower energy prices to be unfounded because “the gas or oil exploited would be sold on European markets and not used in the UK,” the channel cites her as saying.
And yet, Prime Minister David Cameron believes that fracking is “good for the country” and simply believes the misunderstandings to be the result of a lack of information that requires reaching out to communities. And there is basis in that: surveys seem to suggest that people with less information about fracking are more likely to oppose it.
One official claims that locals would still be consulted whenever drilling occurs, adding that opponents of the practice will not be an obstacle.
The unnamed government official also told the Times that “if planning permission is granted above ground, we cannot allow a small number of people to delay the agreed development by trying to wrap the pipes in realms of red tape below ground.”
But it has also been said recently that ‘bribing’ the people in order to continue fracking has been costing the British government thousands of votes.
10 Comments on "UK to hush fracking victims with $1.35mn as vast new reserves uncovered"
mike on Sun, 25th May 2014 7:08 am
The British Geological Survey has thrown cold water on theis fantasy of a vast unlimited abundance of shale oil under sounthern England. The trillions of oil are locked up in deep (2 kms or more)heavily distorted faulted and folded palaeozoic shales that will yield their wealth only at great cost. Only 3% of the oil is recoverable at today’s price, providing about on year of the UK’s total oil needs. Brent crude price goes up, maybe double that is recoverable – two or three years total of UK’s oil usage. No need to woryy about the impact on the environment, the oil ain’t worth the effort of drilling.
dolanbaker on Sun, 25th May 2014 7:57 am
I agree Mike, but you missed the words ” at today’s prices” off the end of the last sentence. The UK (& much of Europe) will soon have to face the “frack or freeze” predicament. If at that time the price is high enough and imports are unable to keep up with demand the fracking will begin in earnest!
Plantagenet on Sun, 25th May 2014 9:58 am
Good to hear more oil and NG is being found in England especially as Scotland s oil will soon be gone
bobinget on Sun, 25th May 2014 10:56 am
Renewables the solution to UK’s critical fossil fuel shortage – report
Conservatives Cut Renewables Support
Friday, May 16th, 2014 By Tom Revell
The UK faces a desperate shortage of natural resources such as oil and coal, according to a troubling new report that underlines the need for significant investment in renewable energy.
In new analysis, researchers from Anglia Ruskin University’s Global Sustainability Institute (GSI) have comprehensively mapped known international reserves of resources, also looking at supplies of food and water.
They found that the UK’s own reserves contain only enough oil to last 5.2 years at the current rate of consumption, with just 4.5 years of coal and three years of gas.
This means the UK is slightly better off than some of its neighbours – France, for example, has less than a year’s worth of oil, gas and coal.
However, some other European states are far better off. Russia has enough oil to sustain itself for over 50 years, with over 100 years of gas and more 500 years of coal, based on current internal consumption.
Norway has enough natural gas to last itself 420 years, while further afield, Qatar could continue consuming its gas reserves at the current rate for over a millennium.
“These maps show vulnerability in many parts of the EU and they paint a picture of heavily-indebted European economies coming under increasing threat from rising global energy prices”, said Dr Aled Jones, director of the GSI.
Prof Victor Anderson, also of the GSI, added that the report highlighted the need for alternative energy sources.
“The UK urgently needs to be part of a Europe-wide drive to expand renewable energy sources such as wave, wind, tidal and solar power”, he said.
Above: European resource maps for coal, gas and oil (click to enlarge).
Increased energy security is one of the biggest advantages that domestically produced renewable energy brings.
In April, a committee of MPs criticised the British government for failing to deliver plans that offer a secure, long-term energy supply.
This came after the Conservative party pledged to cut support for onshore wind projects and the Coalition government altered subsidies for solar power, making investors uneasy about the prospects of renewable projects.
The analysis is the first phase of the GSI’s ambitious Global Resource Observatory project, a survey that will provide an international database of national demand, supply and flow figures relevant to global resource security.
The first published findings also include a map of food reserves, finding that while Europe, America and Russia are well stocked, Africa the Arabian Peninsula and the Caribbean are highly dependent on imports.
keith on Sun, 25th May 2014 11:28 am
The reasons for the Ukraine crisis unfold.
Mike2 on Sun, 25th May 2014 12:08 pm
Britisch energy isn’t that a Problem: Nuklear can do it all! Not the first batsch of reactors we hear of today, but there will be a second and third ‘reactor programms’. 80% Of electricity and some of the heating and Coach/taxi,..traffic, all this can be done with electricty today. Heavy trucks and ships can be done by LNG. The market for conventional oil will not die, but its getting smaler. 😉
MKohnen on Mon, 26th May 2014 12:30 am
I hear a lot about “today’s prices.” And always implied with that is that, if prices rise considerably, considerably more oil will become viable. But that’s completely a zero-sum equation, isn’t it? If there’s anything I think the financial collapse of 2007-2008 showed us, it’s where the “red-line” for oil prices is. At $147, the entire system locked up. Maybe if we approach that price slower, we could even surpass it, but not by much. So, if anybody might know, of all the reserves, how much is recoverable at, say, $150 (the highest any of the economies could sustain, but not for long)?
Boat on Mon, 26th May 2014 1:54 am
If we use today’s dollars $150 oil would be a great shock but a gradual rise open up opportunities for nat gas and electricity. Semi trucks for example can now get 11-13 mph compared with the avg of 5.5-6 mph. With high prices you would see the fleets of trucks turn over much faster. Nat gas is now being burned to refine oil along with CHP tech and is 90% efficient instead of oil being used to refine oil. Now oil that was used to heat is turned into more products. Lots of examples of innovation if you look around. I would say that no immigration would help the most to reduce demand.
Perk Earl on Mon, 26th May 2014 2:09 am
“At $147, the entire system locked up.”
Sure did, and the question now is whether the system is weaker today due to all the added debt? Maybe the lock up amount now is more like $120 a barrel.
rockman on Mon, 26th May 2014 9:39 am
MK – “But that’s completely a zero-sum equation, isn’t it?” Good point but I would say no…you’re being too optimistic. LOL. That’s why I get frustrated with cornucopians that rant about increased oil production lately. Americans (and the general economy) don’t care how much oil is coming out the ground here…they care about the cost of energy. Your zero sum implies that what extra the economy gains is equally lost in the increase in energy.
But what does the economy really gain? My economy and the rest of the oil patch gains, of course. The oil producing states benefit as Texas did in 2013 when it collected $3.8 billion in severance tax. The fed gov’t collects higher royalty. There’s a nice boost in oil patch jobs.
But for the average citizen…not so much. In the last 10 years they increased their oil expenditure from $225 billion to over $600 billion. Better balance of trade? No: even though we import less the higher prices mean we send more money out of the country now then when we were importing a lot more oil. National security? Without the imports we are still receiving today the economy would crash overnight.
Of course it’s difficult to monetize some of those factors. But I would offer that for the overall economy the situation the net represents a net loss.