Two years ago, experts put these at 5.3 trillion cubic feet (tcf) but it now seems that the British Geological Survey will significantly increase this estimate, possibly to as much as 200 tcf. Exploration companies themselves claim to have identified resources of nearly 300 tcf so far. Offshore reserves, which are much harder to extract profitably, could be as much as 5-10 times larger. Whatever the actual numbers turn out to be, Britain is sitting on plentiful untapped reserves.
Dan Lewis and Corin Taylor, author of a report from the Institute of Directors, make a convincing case that the benefits of embracing shale gas would be greater than the costs. America is leading the way: shale gas on the other side of the Atlantic now accounts for an astonishingly high 23 per cent of domestic gas production and 22 per cent of consumption.
Energy prices have gone down for consumers and companies, at a time when they have gone up in Britain, delivering a major competitive advantage to US firms and further damaging UK industry. One intriguing side-effect from the shale revolution is that US natural gas prices, which used to move in tandem with oil prices, have now decoupled.
The impact of the US shale revolution on that country’s economy is a success story that has gone largely unnoticed in the UK; America’s economic malaise would be far worse without it. By 2020, the shale gas boom is expected to create 3.6m US jobs, both directly and indirectly thanks to lower energy costs. Carbon emissions are falling, as gas is substantially cleaner than coal. The Institute of Directors report uses a conservative estimate of UK production, assuming we would be half as successful as the Americans, to quantify the boost to the British economy from a dash for shale. It calculates that 35,000 extra jobs would be created directly, helping to offset the decline in North Sea oil and gas; that there would be enough onshore supply to meet 10 per cent of our gas demand for the next century, preventing the expected rise in costly gas imports; and that UK carbon emissions would be cut by eight per cent.
What of the controversy surrounding fracking, the technique used to extract shale? The great worry is that it would cause earthquakes. That possibility certainly exists, and needs to be taken extremely seriously, yet in the last 50 days, the UK experienced three earthquakes as large or larger than the bigger of the two earthquakes caused by the energy firm Cuadrilla in 2011. Fortunately, none of these recent seismic events caused any damage; few people even noticed them. All energy sources can be extremely dangerous, as we have learnt from oil spills and nuclear accidents. The trick with fracking is to use the safest methods, to engage in real time seismic monitoring and ensure that safety is paramount. It is time for Britain to take the leap.
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