Sector News

INEOS aims for 5 shale core sites in UK by year end

September 19, 2016

INEOS wants to have lodged five planning applications for vertical core drilling for shale gas in the East Midlands in the UK by the end of this year, the company said on Friday.

CEO Jim Ratcliffe has set a target of 30 such applications within a year across the company’s acquired shale licence acreage in England. Following Scotland’s moratorium on fracking, INEOS has concentrated its shale exploration activity further south.

“INEOS expects to undertake seismic data acquisition [in the UK] this year and next,” said Tom Pickering, operations director at INEOS Shale.

INEOS sponsored an event Thursday and Friday showcasing the developing US energy picture in Philadelphia and hydraulic fracturing of shale, or fracking.

The company will require planning permission from authorities local to where it plans to drill vertical core wells as a first step in a process that could lead to horizontal fracking of those wells.

The results of the core sampling, alongside 3D seismic data, will be used to determine whether the company makes planning applications for horizontal well fracking.

Fracking is a highly emotive and controversial subject in the UK and there has been widespread opposition to the oil and gas extraction process. INEOS has clear targets for shale exploitation to support its manufacturing activities in Europe following its decision to import US ethane on a large scale.

It has discussed the technique and the potential of its plan with 403 local parish councils, all the local councils on its 1m licenced acres. At INEOS community events, 55% of people have been in favour of shale gas development with 15-20% neutral, according to company surveys.

Local people want to learn about what gas drilling and fracking entail and to understand the planning process, said Pickering.

The East Midlands has been chosen as the area potentially best suited for some of the first fracked gas wells in the UK based on its geology and its history of coal and hydrocarbons production.

INEOS has said it will offer financial incentives to landowners and local communities affected by its on-shore exploration and production activities.

Gas well drilling and hydraulic fracturing in the US has been compressed in time as the exploration and production technique has advanced with disruption of about six to nine months including two to three weeks of drilling and a week of fracking.

“The results of flow tests [from the sampled wells] will tell us if commercial production is viable,” said Pickering. 3D seismic data will be essential to supplement the 3D seismic information that is more widely available in the UK.

INEOS says it could better understand the shale reservoir characteristics of its licenced acreage within two years and within five years have in place a test cluster of wells within a designated area.

By Nigel Davis

Source: ICIS News

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