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Official UK Shale Gas Estimates Higher Than Thought

A good a person as any to give David Cameron, Ed Davey and Vince Cable an educated opinion on UK shale gas reserves before Davey decided to tell Parliament that experts they had spoken to thought that UK shale resources weren’t important enough to change government policy would be the British Geological Survey. After all, they are government geologists, and since shale resources are held by the Crown, have an interest in how big they are.

At the SMI Environmental Shale Summit today, Tony Grayling, Head of Climate Change and Communities at The Environment Agency, volunteered that there was debate about the size of UK shale gas resources. He mentioned the older estimate much loved by Greens, that it would appear the UK had only 150 BCM of shale, not very impressive since the UK uses 90 BCM a year. I think a government so desperate to save money by firing civil servants, teachers, policemen and nurses because “there is no alternative”, shouldn’t be so sniffy about even the lower figure which is worth £30 billion pounds.

We already know the BGS has said the original figures were being updated based on new information from the UK and the US, and had state there was “much more gas under Blackpool than we thought” last January. The report may still be six months away, but Tony Grayling said today that based on his conversations with the BGS, the revised figure was going to be close to a resource of 6 trillion cubic metres.

Which is interesting in that is slightly higher than the Cuadrilla estimate of 200 TCF or 5.6 trillion CM.

Now these are my figures: recoverable resources using US analogues would range from 10 to 30%, so at a mid range of 20% that makes it 1.12 trillion CM. Assume a conservative 40 year field life and a 62% take take and that means £3Billion a year to the Treasury and 15% off the balance of payments from ceasing imports.

Put another way, at an average £25K salary, that adds up to the jobs of 120,000 incompetent teachers, deadbeat civil servants, donut munching cops or useless nurses. Who also happen to be voters with families who vote, although allegedly they can all go get jobs in the allegedly booming private sector.

But since Davey had already decided there is no alternative, there isn’t. Don’t ask, don’t hear, don’t tell. Arrogance or incuriousity or possibly they are so smart they don’t need to worry about actual facts. We deserve to be told.

No Hot Air, 23 May 2012