UK Shale Industry Prospects Remain 'Widely Bearish'
Prospects for the UK shale industry remain ‘widely bearish’, according to oil and gas analysts at BMI Research.
“For shale gas to be commercially produced, extensive work must be carried out to better understand the potential resource base, the social...will for which remains sour,” the analysts said in a brief research note sent to Rigzone.
“We remain highly skeptical over the longer-term viability of shale gas in the UK,” the analysts added.
BMI confirmed that 2018 is likely to mark the first time in which hydraulic fracturing will take place in the UK for over seven years, with the last well being tested in 2011.
“The results of upcoming drilling tests in several onshore licenses across the UK will be important for resource determination. However, crucially, the completion of the small drilling schedule will provide an extremely small proportion of the required activity to properly delineate and quantify the existing resource base in the UK,” BMI analysts said.
“Consequently, a high volume of additional drilling will need to take place, the scope for which we believe to be shrinking,” the analysts added.
In its report, BMI also said there was an indication of growing political caution regarding the UK shale industry, despite the government’s stated support for the sector.
In a white paper published late last year, the UK government said the emerging shale gas industry in the region ‘offers the prospect of creating jobs, enhancing the competitiveness of downstream sectors and building up supply chains’.
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