By Sarah Young and John McGarrity
LONDON, June 27 Britain doubled its estimate of
shale gas resources in the north of England, renewing hopes of
reducing its growing reliance on imports, but the government
said shale explorers would have to share revenues with local
A report by the British Geological Survey estimated on
Thursday the rocks of the so-called Bowland shale area held
1,300 trillion cubic feet (tcf) of gas.
The latest estimate indicates shale gas could transform the
UK energy market, even though typically only 10 to 15 percent of
shale gas in place is recoverable. It compares with British
consumption of 2.76 trillion cubic feet last year, according to
"Today's news from the Geological Survey confirms 1,300
trillion cubic feet of (shale resources), which is double
previous estimates," Chief Secretary to the Treasury Danny
Alexander told parliament.
Britain, Europe's largest gas consumer, hopes to follow the
United States into energy independence by exploiting shale gas.
Its gas imports are expected to surpass domestic North Sea
production by 2015.
But the British shale gas industry is at an early stage and
has not yet determined whether it can produce gas economically.
Recovery depends on the type of rocks and their response to
the hydraulic fracturing (fracking).
PLACATING THE PUBLIC
Drilling to test the shale over the next few years will
prove critical for the infant industry, which must reassure a
sceptical public and vocal environmental lobby concerned about
the effects of fracking.
To help placate the local opposition, the industry will have
to provide communities located near exploratory wells with
100,000 pounds ($153,400) worth of benefits and 1 percent of the
revenue from each production site, the government said on
"This will provide a welcome boost for communities who will
host shale exploration and production as well as offering strong
assurances that operators will engage with them and work to the
highest health, safety and environmental standards," Energy
Minister Michael Fallon said in a statement.
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
A year-long ban on drilling was recently lifted after the
government imposed more stringent rules on fracking to reduce
any earthquake risks.
Major energy companies are taking steps to participate in
the exploration and development of Britain's shale gas.
UK utility Centrica recently bought a stake in
Cuadrilla, the most advanced shale driller in Britain. French
oil major Total also said it would like to explore for
shale gas in Britain.
Companies already exploring for shale in the Bowland area in
northwest England include IGas, which has estimated
that between 15.1 and 172.3 tcf of gas is in place on its
Shares in IGas were up 9 percent in early trading on