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Ineos announces UK shale gas exploration plans
- 9 years ago (2014-11-25)
- Junior Isles
Following its recent acquisition of 1.866 sq. km (729 square miles) of fracking licences in Scotland, Britain’s largest chemical company, Ineos, has recently revealed a £640 million ($1.024 billion) scheme to develop its exploration operations for shale gas across the UK.
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Jim Ratcliffe, Ineos’s billionaire owner, at a presentation in London, noted that “I don’t think the UK is in a great place for energy – nor for manufacturing … we are buying the most expensive electricity in Europe. Shale has the ability to change that.”
Despite never having drilled wells before, Ineos has applied for a number of licences for areas ranging across Scotland and the north of England. Ineos UK’s Chief Executive further underpinned this statement of intent, as he said that: “I want Ineos to be the biggest player in the UK shale gas industry. I believe shale gas could revolutionise UK manufacturing and I know Ineos has the resources to make it happen.”
Meanwhile, Britain’s coalition government greeted the news enthusiastically, as Energy Minister Matt Hancock described the Ineos scheme as “a strong stride forward for this important domestic energy source and jobs”.
However, safety concerns still remain over shale gas as just 43 per cent of Scots polled in a recent YouGov survey were supportive of the idea. This was compounded by 26 Scottish community and environmental groups recently demanding delays to exploration due to fears over pollution, as well as planning refusals, small earthquakes and legal challenges in England.
Simon Clydesdale, a Greenpeace energy campaigner, said investment in UK energy was warranted, but that shale came with “ludicrous levels of hype” as it has “been completely oversold”.
To try and garner more support, previous Ineos propositions have seen figures of around 6 per cent of profits donated to local communities. In addition, Ratcliffe has also pointed to the energy needs of the British economy: “We are not going to survive long-term if we pay two times the amount for electricity as Germany… if businesses are not profitable, you have to shut them down”.
This has followed statements intimating that both Ineos’s huge petrochemical plant in Runcorn, Cheshire, as well as its Scottish Grangemouth facility could close in the coming years due to the high price of energy. The company has recently been developing a facility to handle shale from the US to use in Grangemouth – and developing a domestic source would indeed help cut costs.
Even while the British Prime Minister, David Cameron, has stated that his government is going “all out for shale”, there remain considerable challenges ahead in convincing unruly dissenters.