Developing UK shale gas industry would need £33-bn investment
24 April 2014
Investment of £33 billion was needed to establish a shale gas industry in the UK, a report by consultancy giant Ernst & Young says.
The UK would need billions of pounds by way of investments in supply chain for drilling 4,000 wells potentially creating 64,000 new jobs, the report said.
Heavy investment would be needed in areas like specialist fracking equipment, waste management, and raw materials such as steel.
Ernst & Young's report was commissioned by industry body UK Onshore Operators Group (UKOOG).
International Business Times quoted Michael Fallon, UK minister of state for business and energy as saying he wanted the report to be a call to action for the UK supply chain for small and large companies, whether in Lancashire or Lowestoft, whether in the steel industry, the chemical industry, or in other manufacturing and services. He added, the message was to get ready for shale.
But environmental campaigners hit back at the EY report with Dr Doug Parr, chief scientist at Greenpeace saying the report was a rehash of rose-tinted industry guesstimates about the economic potential of fracking in the UK.
He added, paying accountants to tally up hypothetical jobs would not change the fact that executives still had no idea whether they would actually be able to get gas out of the ground on a commercial scale in the UK.
The study also highlighted the need for 50 new land-based drilling rigs to meet the industry's demand along with the fabrication of 8,000 miles of steel casing and £4.1 billion of investment into other services such as transportation.
The Telegraph quoted Ken Cronin, chief executive of the oil industry body as saying the industry, which would be built in the country would not only potentially give the UK energy security, and make a big contribution in tax revenues, but will also bring immense benefits to other industries and create sustainable, well-paid jobs.
The development of fracking in the UK, had so far proved controversial, despite its potential to safeguard energy security.
The concerns mostly centred around the disruptive impact to rural communities by drilling and fears over the possible environmental consequences of the fracking process.
The findings had been broadly welcomed by business in the UK and according to Deirdre Fox, Tata Steel's director of strategic business development in the UK, the report was an ''eye-opener as to how big an opportunity the responsible development of a shale gas industry was for the UK economy."