Industry News – Limited Role For Majors In UK Shale Round – OCT 2014 | Oil and Gas Insight

BMI View: We expect that small to mid-sized specialised firms as opposed to oil majors will show the largest interest in the upcoming shale licensing round. Majors interested in UK shale prospects will more likely enter funding agreements with these smaller specialised firms once more knowledge on the prospectivity is known .

Royal Dutch Shell has no plans to allocate capital to shale gas exploration projects in the UK, as highlighted by Andrew Brown, Director of Shell’s Upstream International Business division. Brown justified this position by stating that the combination of geology, costs and access make the UK’s nascent shale industry an unlikely target for the company.

Shell’s statements, ahead of the UK’s 14th onshore licensing round, highlights that small and specialised firms as opposed to oil majors will show the largest interest in the upcoming shale licensing round. Given the UK’s shale deposits remains largely unexplored, we believe that majors will be unwilling to take on the risks of the unproven play, focusing on larger and high-value-added projects elsewhere. The round, expected to issue between 50 and 100 shale gas licenses in H214, will be Britain’s first.

via Industry News – Limited Role For Majors In UK Shale Round – OCT 2014 | Oil and Gas Insight.