Alistair Buchanan may have his reasons to downplay UK Shale gas as he did last week (I'm still waiting for the source of AB's opinion from Ofgem), but here is the other side of the issue. This from a presentation by Graham Dean of Reach CSG from a Hanson Wade conference last week. Graham chairs the UK Unconventional Gas Group.

This shows that the potential for UK shale gas is far greater than simply the Cuadrilla prospects of 200TCF resource announced last year.  


It's worth noting that the next UK Llicensing Round that has been 3 months away for the past two years  has potential to make this map look even busier.  

The Reader's Digest version of UK shale is that the last licensing round in 2008, only Cuadrilla appeared to see any shale potential.That isn't surprising since at the time, shale technology was only just starting to become widely known in the US and most of the billion dollar investments there by both oil majors had yet to happen.

Everyone else, especially including DECC, saw UK onshore as a backwater to the main event offshore. Current license holders efforts were directed at Coal Bed Methane. CBM is all small scale attempts to release methane from coal beds, often to power small scale power plants that will sit above them. Today, CBM technology is being eclipsed as the potential for far greater shale gas volumes becomes more apparent using the technology breakthroughs of North America. But the smaller companies who started out wanting to develop CBM can access any hydrocarbon: conventional, shale, oil, CBM etc and are now starting to wake up not only to UK potential,  but also their potential.

Of course the answer we all want to know is: How big a number is that?  And how soon? As this  slide shows, bigger and sooner than the conventional wisdom of Alistair Buchanan or the wishful thinking of Centrica may hope for.

UK Shale2

This isn't fantasy island here, that belonging to the Ofgem narrative of plucky little Britain prostrate before evil Russians and the yellow peril of China sucking up all our LNG. The second graph is more likely to be conservative in volumes, while being eminently realistic in how we need to slowly ramp up from 20 wells in 2014 and slope up gently afterwards. This graph doesn't show the actual hockey stick graphs we see from development in the US for example.

Finally an interesting little map. Some say that Europe doesnt' have the geology for shale. What they may miss is that they are looking 3,000 miles across an ocean today, whereas 350 million years, when shale gas was formed out of forests, rivers and reefs, the world was a different place. 




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