It’s hard to fathom. In March 2013, the UK, Europe’s largest gas consuming nation, was reportedly just “six hours from running out” of natural gas. With North Sea gas production falling and gas imports hitting a record high during the fifth coldest spring on record, the country’s dependence on overseas supplies is growing steadily. All of which has re-focused attention on the coalition’s dithering over the UK’s potential “new North Sea” of shale gas.
Along with increasing dependence on expensive Qatari LNG (which got the UK out of the fix it was in during March) and Russian and Norwegian imports, the UK government has just announced a prospective deal to import Azerbaijani gas. If UK industry and domestic consumers were hoping for an early cut in gas prices – already twice that being paid in the United States – it seems they can forget it. At the root of the foot-dragging is a Department of Energy and Climate Change (DECC) headed by yet another green Lib Dem zealot Ed Davey. Davey is patently more concerned with theories about climate than he is with hard economic facts about energy. While George Osborne’s Budget ostensibly set up the Office of Unconventional Oil and Gas, allegedly to “co-ordinate” matters for potential shale developers, the plain reality is that the DECC has put a whole bunch of environmental obstacles in the way of a nascent shale industry.
Albeit the process of fracking (shale fracturing) has a 60-year heritage with not a single drinking water aquifer being polluted and with associated tremors equivocating to the impact of jumping off a ladder, thus far the DECC has imposed an 18-month moratorium while constantly playing down the prospects for UK shale extraction. The DECC has made no effort to help developers navigate the complexity of licensing laws, and there is no sign of George Osborne’s promised tax breaks.
UK Government Still Dithering on “New North Sea” of Shale Gas