UK: Cuadrilla Unveils Huge Shale Gas Find

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Cuadrilla Resources Ltd., a private-equity backed shale-gas explorer in the U.K., said drilling results indicated its license area in northwest England may hold 200 trillion cubic feet of the fuel.

We’ve got a very sizable resource in place,” Dennis Carlton, executive director of Cuadrilla Resources, said in a phone interview from Blackpool, England. “Without drilling individual units within the thick shale we don’t know what the recovery factor will be.”

Two exploration wells near the seaside resort of Blackpool found shale formations almost 10 times as thick as typical U.S. deposits, Carlton said. Hydraulic fracturing, a process that uses water, sand and chemicals to smash apart rocks and release trapped fuel, reversed declines in U.S. natural-gas output and made it the world’s largest producer.

As many as seven exploration wells may need to be drilled, fractured and tested before more information can be given about recoverable reserves, he said. Investors in Cuadrilla include Riverstone Holdings LLC, led by former BP Plc Chief Executive Officer John Browne, and AJ Lucas Group Ltd. (AJL)

In the Marcellus, if you have a 300- to 400-foot interval, that’s on the high side,” he said, referring to one of the largest U.S. shale-gas basins. “We’ve got 3,000 foot of shale.”

The U.K.’s largest shale resource found to date is equivalent to 5.6 trillion cubic meters, or about three times Norway’s existing, proved reserves. Norway is the second-largest gas exporter to Europe and the biggest foreign supplier to Britain.

Recover Fraction

Cuadrilla is likely to be able to recover only a fraction of the gas trapped in the rocks. The U.K.’s technically recoverable shale resources are 20 trillion cubic feet, the U.S. department of Energy said in an April report.

The company has 1,200 square kilometers (300,000 acres) under license in northwest England, covering 80 to 90 percent of the shale in the area, he said.

We’ve got the best of the best, at least in the Bowland basin,” he said.

North Sea gas production is declining and the U.K. is increasingly reliant on imports to meet Europe’s highest demand for natural gas.

Cuadrilla voluntarily halted fracking at its operations in June after “small tremors” were reported in the area, according to its website. The company will submit a report to the Department of Energy and Climate Change in October, Carlton said.

Carlton estimated a “mid-case” scenario of drilling 400 production wells from 40 well pads in the future. To date they have drilled two exploration wells and have historical data from three 10- to 15-year-old wells drilled by British Gas.

Original Article

Posted on September 22, 2011, in Oil & Gas - inland, Shale Gas, United Kingdom and tagged , , , , , , , , , , , , , , . Bookmark the permalink. 2 Comments.

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