Fracking is enabling gas extraction from fields that were previously considered beyond the reach of gas recovery. It’s a booming business in some parts of the world, enabling gas to be produced locally, reducing energy prices and reliance on gas imports.
But what does it means for the UK?
Advocates claim that fracking could have a dramatic impact on energy prices, enabling the UK to step towards energy independence. Critics fear environmental side effects such as ground water pollution and minor earthquakes.
At the heart of the debate is the technology used to extract so-called shale gas. It involves drilling horizontal wells in shale rock a kilometre below the surface. Massive quantities of a cocktail of chemicals, sand and water are pumped into the well to force the gas out of the rock at high pressure.
Fracking has already begun in Australia, China, Poland and the US, but it has been banned in Bulgaria and France amid safety concerns. In the US, fracking now accounts for a quarter of the country’s natural gas extraction and is growing.
Shale gas exploration in the UK is a work in progress.
An early project was halted pending further investigation of the risks. Exploration firm Cuadrilla Resources claims to have found huge reserves of gas at a site near Blackpool in Lancashire. But drilling was stopped in May 2011 after minor earth tremors were recorded.
A government-backed report published in April 2012 has given the go-ahead for fracking to continue in the UK but with strict regulations in place. Citing data from the coal mining industry, the panel of experts reported that fracking is unlikely to produce a quake of anything larger than Magnitude 3.0.
Drilling may have been halted in Lancashire for now, but preliminary wells uncovered 5.6tn cubic metres (200tn cubic ft), equal to the reserves of energy exporting countries such as Venezuela, which would go a long way to making a significant dent the UK’s gas deficit.
According to the Department of Energy & Climate Change (DECC), in 2011 the UK imported 64% of its total demand.
An announcement from DECC on whether fracking can continue in the UK is expected shortly and the UK Parliamentary Energy and Climate Change Committee is planning an enquiry into the impact of shale gas on energy markets.
The outcome is likely to be positive. A leaked letter from the Chancellor to the Climate Secretary in July indicated that the Treasury at least favours gas over renewables.
By the end of this year we should be closer to understanding the impact of fracking and shale gas on the UK business energy market. Keep an eye out on our site for updates.