Shale Gas Exploration and Hydraulic Fracturing South Cleveland - - PowerPoint PPT Presentation

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Shale Gas Exploration and Hydraulic Fracturing

South Cleveland Basin Area September 2016

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• Who we are
• What is Unconventional or Shale Gas
• UK Shale Gas Areas
• Operations
• Economics

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Cuadrilla – who we are

• Formed in 2007, UK company
• Early entrant to shale gas in Europe
• Backed by industry-specialist funds

UK Exploration assets

• Bowland basin ≈ 293,000 acres
• Weald basin ≈ 192,500 acres

UK 14th Round offers

• Cleveland basin and

Gainsborough Trough ≈ 314,800 acres

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• What is Unconventional or Shale Gas?

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Why is Hydraulic Fracturing Needed?

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Gas emanating from visible fractures

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• UK Shale Gas Areas

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DECC/BGS Shale Gas Study

Central Case Estimates

• Bowland Basin

– 1,329 tcf gas

• Midland Valley

– 80.3 tcf gas – 6.0 billion bbl oil

• Weald Basin

– 4.4 billion bbl oil

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Bowland License Areas

http://www.ukogl.org.uk/

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South Cleveland Basin

SE75 SE85 SE74 SE84 SE95 TA05 TA15

http://www.ukogl.org.uk/

Operator Block(s) Firm commitment Drill or Drop CUADRILLA SE74 & SE84 new 2D 1 well CUADRILLA SE75 new 2D 1 well CUADRILLA SE85 & SE95 new 2D 1 well CUADRILLA TA05 &TA15 new 2D 1 well EUROPA SE72 & SE73 new 2D 1 well

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• Operations

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Seismic

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Historic Seismic Coverage

http://www.ukogl.org.uk/

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2D Seismic

SPE 14UNCV-167776-MS, Clarke et al

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Historic Drilling

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Drilling

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Well Design

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Hydraulic Fracturing

• Injects fluid into rock at a high enough pressure to cause the rock to

fracture.

• Fluids can be water based, hydrocarbon based, acids, liquid CO2,

gaseous N2, foams and various combinations.

• Fluids must be approved by the EA and be non-hazardous to

groundwater.

• The fractures are held open with proppant after the hydraulic pressure is

released.

• Typically silica sand.
• At greater depths or pressures, ceramic proppants can be used.
• Common sizes are 20/40 mesh (0.853mm-0.422mm) and 40/70 mesh

(0.422mm-0.211mm)

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This is not a frac rig!

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Frac Kit

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Frac Boats in the North Sea

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Development is in the subsurface

Multi-well pad

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After drilling and fracturing the equipment is removed

(Artist’s impression, production pad 2013)

Elswick facility

For the next 25 years the site looks like this

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The UK regulatory process is thorough

Statutory bodies

• Department for Business, Energy &

Industrial Strategy/Oil and Gas Authority (OGA),

• The Environment Agency (EA)
• The Health and Safety Executive

(HSE)

• The EA and HSE continually monitor
• perations

– March - August 2011: EA visited the Preese Hall site 10 times (7 unannounced visits)

• Mineral planning authorities approve

all surface operations Environmental permits issued by the EA comply with:

• EU Mining Waste Directive
• EU Industrial Emissions Directive
• EU Groundwater Directive
• EU Water Framework Directive
• Other relevant legislation

Other consultees

• Natural England
• National Grid
• Public Health England
• Parish Councils
• Water Utilities

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This EASAC analysis provides no basis for a ban on shale gas exploration or extraction using hydraulic fracturing on scientific and technical grounds… North Atlantic Group of the European Geological Surveys "The Survey Directors are concerned that frequent misleading media messages regarding exploration and exploitation of raw materials and geo-energy have the potential to obscure scientific results and conclusions, and may ultimately lead to poor decisions for Society." "Often dangers are evoked where there are

• none. When fracking for production of natural

gas there are widespread fears in the population, most of which are unfounded from geoscientific perspective." The health, safety and environmental risks associated with hydraulic fracturing (often termed ‘fracking’) as a means to extract shale gas can be managed effectively in the UK as long as operational best practices are implemented and enforced through regulation. The currently available evidence indicates that the potential risks to public health from exposure to the emissions associated with shale gas extraction are low if the operations are properly run and regulated.

European studies

The areas of health, wellbeing and safety surrounding an onshore industry do not appear to present significant risks, although a degree of uncertainty is present. The technology exists to allow the safe extraction

• f such reserves, subject to robust regulation

being in place.

The Scottish Government, Edinburgh 2014

A total ban on hydraulic fracturing can not be justified on the basis of scientific and technical facts.

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• Economics

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DECC DUKES2015 Annex H

UK natural gas use

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Future gas use scenarios

(Source: National Grid Future Energy Scenarios 2016)

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What a successful shale gas industry has to offer

• Meaningful unsubsidised private investment
• Meaningful job creation
• Meaningful energy security contribution
• 10% of tax revenues from shale gas developments, up to a maximum of £10m

per site to be spent on local areas

• Community benefit for local people

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Thank you