UK shale driller Cuadrilla returns to frack in Lancashire

Tue Feb 4, 2014 7:44am EST

Related Topics

* Up to eight wells to be fracked in northwest England

* Cuadrilla re-focuses on prize assets

* Company to apply for permission to drill, frack first

By Oleg Vukmanovic

LONDON, Feb 4 (Reuters) - Britain's shale gas-driller Cuadrilla Resources plans to hydraulically fracture up to eight wells at exploration sites in Lancashire, northwest England, to determine their full production potential.

Its statement is likely to spark opposition from environmental protesters who had hindered the firm's drilling plans in the village of Balcombe, south England.

Cuadrilla's latest exploration programe marks a return to its prize assets in the Bowland shale, a long belt of gas-bearing rock over one kilometre thick at its Fylde sites in Lancashire.

The company will first apply for permission to drill, hydralically fracture and test the flow of gas from up to four exploration wells each at Fylde's Roseacre Wood and Preston New Road, it said.

"This will allow us to reduce the potential impact on the local area during exploration while still gathering the important information we need to determine how much gas could be recovered," Chief Executive Francis Egan said in a statement.

The rocks of the Bowland shale area are estimated to hold around 1,300 trillion cubic feet of gas, a vast potential reserve that proponents say could lead Britain to energy independence, create jobs and cut bills.

Britain, Europe's largest gas consumer, hopes to follow the United States into energy independence by exploiting shale gas. Its gas imports have already surpassed falling domestic North Sea production, leaving it dependent on foreign suppliers.

While the volume of gas locked up in its rocks is vast, Cuadrilla and other shale drillers need to test the recoverability of gas from the Bowland basin before they can understand its commercial potential.

Typically only 10-15 percent of shale gas trapped in rocks are recoverable.

Shale gas is ordinary natural gas trapped in dense rock formations. The process of fracking, in which water and chemicals are pumped deep underground to break open the rocks, has led to fears it could cause earthquakes and contaminate drinking water.

Shale gas has helped transform the U.S. energy market, lowering gas and coal prices, and offers Britain a means of switching to less polluting energy while bolstering its falling natural gas production.

Three companies are leading the charge to develop Britain's shale gas resources: Australia's Dart Energy which is partnered with GDF Suez, London-listed IGas Energy and Cuadrilla, a privately owned business partnered with British utility Centrica.

France's Total also bought a 40 percent interest in two licences in the so-called Gainsborough Trough area of northern England for up to $48 million last month.

Britain will launch its latest licensing round to allow companies to explore for shale gas in early summer.

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