U.K. Shale Could Spark $55 Billion in Investment, E&Y SaysNidaa Bakhsh
U.K. shale-gas production has the potential to boost local demand for supplies from rigs to steel casings and waste-water management, according to an Ernst & Young LLP report commissioned by an industry lobby.
About 33 billion pounds ($55 billion) would have to be spent to bring 4,000 wells into production by 2032, according to the report, commissioned by the U.K. Onshore Operators Group, or UKOOG. That would create 64,500 jobs, it said.
The bulk of the expenditure, or 62 percent, would be for hydraulic fracturing, the controversial technique that pumps water, sand and chemicals at high pressure to release the trapped gas from rock underground.
The U.K. government has promised tax breaks to drillers as it seeks to cut reliance on imports and stimulate the economy amid declining North Sea reserves. The industry is offering incentives to local communities affected by works as campaigners say the extraction process can contaminate ground water, pollute the air and cause disturbances.
The Bowland basin, extending across an area of northern England that includes Manchester, Liverpool and Sheffield, may hold 1,300 trillion cubic feet of gas, according to the British Geological Survey. That’s enough to meet demand for about half a century at extraction rates similar to U.S. fields.