Shale gas in the UK: it’s not all about the science

The gas is there, but companies in the UK need more support to get it.

Shale gas exploitation has recently been given the go-ahead in the UK. With all the excitement, claim and counter claim, it would be easy to forget that to date not a single molecule of methane from shale gas has been produced and sold. We have drilled one shale gas well. That’s an 8½ inch borehole in Lancashire, a little like pushing a pin through the ceiling of your living room and looking through the hole. It does not tell you much about what’s in there. So will this new source of gas make a difference?

Let’s start with some numbers. Present UK annual production of natural gas is around 1.5 TCF (trillion cubic feet), but each year we use about 3.3 TCF. In the USA in the last 10 years, approximately 20,000 shale gas wells have been drilled and they now have an annual shale gas production of 3-4 TCF per year. If we use the USA as an analogy, the UK would need to drill thousands of wells to prove the reserves exist and make up just a part of the annual 1.8 TCF short-fall. Unlike wind energy, where there has been a move to develop it offshore, this is ecomomically unviable for shale gas because the rate of flow of gas for each well (i.e. revenue) is low relative to gas from other types of rock . So we cannot get away from it - researching the risks and an open and honest debate about them is an essential element in gaining the social acceptance of the technology that will be required.

Durham University have been working on this. Firstly, despite what we are often told, to date in the USA there is not one proven case of contamination of drinking water due to fracking after hundreds of thousands of fracking operations. But the contamination question led us to establish a guideline for a safe vertical separation distance of 600m between the depth of the fracking and shallower water supplies. If adopted, contamination of water supplies would be extremely unlikely.

We’re working on other issues. For instance the water used for fracking flows back to the surface in a controlled way after the operation is over. This water is contaminated with naturally occurring radioactive material, otherwise known as NORM. Even with the hundreds to thousands of wells that would be required to make an impact in the UK, the amount of radionucleides such as radium 226, is going to be a fraction of that produced by the medical sector, universities and existing oil and gas production. It would need to be cleaned and any residue safely disposed of. The technology exists – so this is not a show-stopper.

USA shale gas production took off in the last 10 years because the country has thousands of onshore drilling rigs available to carry out the drilling and helpful landowners who in some cases own the gas under their land. Both are not the case in the UK. Even if the social acceptance is forthcoming, it will take years for the industry to gear-up to drill enough wells to make an impact on the production-consumption gap. The science behind extraction of the gas reserves may in the end be secondary to issues of public trust in oil and gas companies, regulators and local and national government. The gas is there, but companies in the UK need what was recently coined a "social licence to operate". Without this the wells will not be drilled and shale gas will only ever make a tiny contribution to our economy and energy security.

Richard Davies is director of Durham Energy Institute, one of Durham University’s eight Research Institutes

But does it really? Photograph: Getty Images

Richard Davies is Director of Durham Energy Institute.

Photo: Getty
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Theresa May's U-Turn may have just traded one problem for another

The problems of the policy have been moved, not eradicated. 

That didn’t take long. Theresa May has U-Turned on her plan to make people personally liable for the costs of social care until they have just £100,000 worth of assets, including property, left.

As the average home is valued at £317,000, in practice, that meant that most property owners would have to remortgage their house in order to pay for the cost of their social care. That upwards of 75 per cent of baby boomers – the largest group in the UK, both in terms of raw numbers and their higher tendency to vote – own their homes made the proposal politically toxic.

(The political pain is more acute when you remember that, on the whole, the properties owned by the elderly are worth more than those owned by the young. Why? Because most first-time buyers purchase small flats and most retirees are in large family homes.)

The proposal would have meant that while people who in old age fall foul of long-term degenerative illnesses like Alzheimers would in practice face an inheritance tax threshold of £100,000, people who die suddenly would face one of £1m, ten times higher than that paid by those requiring longer-term care. Small wonder the proposal was swiftly dubbed a “dementia tax”.

The Conservatives are now proposing “an absolute limit on the amount people have to pay for their care costs”. The actual amount is TBD, and will be the subject of a consultation should the Tories win the election. May went further, laying out the following guarantees:

“We are proposing the right funding model for social care.  We will make sure nobody has to sell their family home to pay for care.  We will make sure there’s an absolute limit on what people need to pay. And you will never have to go below £100,000 of your savings, so you will always have something to pass on to your family.”

There are a couple of problems here. The proposed policy already had a cap of sorts –on the amount you were allowed to have left over from meeting your own care costs, ie, under £100,000. Although the system – effectively an inheritance tax by lottery – displeased practically everyone and spooked elderly voters, it was at least progressive, in that the lottery was paid by people with assets above £100,000.

Under the new proposal, the lottery remains in place – if you die quickly or don’t require expensive social care, you get to keep all your assets, large or small – but the losers are the poorest pensioners. (Put simply, if there is a cap on costs at £25,000, then people with assets below that in value will see them swallowed up, but people with assets above that value will have them protected.)  That is compounded still further if home-owners are allowed to retain their homes.

So it’s still a dementia tax – it’s just a regressive dementia tax.

It also means that the Conservatives have traded going into the election’s final weeks facing accusations that they will force people to sell their own homes for going into the election facing questions over what a “reasonable” cap on care costs is, and you don’t have to be very imaginative to see how that could cause them trouble.

They’ve U-Turned alright, but they may simply have swerved away from one collision into another.  

Stephen Bush is special correspondent at the New Statesman. His daily briefing, Morning Call, provides a quick and essential guide to British politics.

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