Ineos, the company at the centre of last year’s bitter dispute with unions at its Grangemouth petrochemical plant, has bought the rights to explore fracking for shale gas in a 127 square mile area around Grangemouth and the Firth of Forth.
The company, which is controlled by publicity-shy Switzerland-based multimillionaire Jim Ratcliffe, said on Monday it had bought 51% of the rights to fracking licence PEDL 133, which covers the Midland Valley of Scotland.
The news of Ineos’s entry into shale gas extraction came on a day of organised nationwide protest against companies involved in fracking, which saw 10 arrests at a Cuadrilla building in Blackpool and activists superglueing themselves to the doors of the Department for Environment, Food and Rural Affairs (Defra) in London.
Ineos, which is the world’s fourth biggest chemicals company and, through Grangemouth, supplies nearly all of Scotland’s forecourt petrol, said it intends to become a “major player” in onshore gas production in the UK.
The company, which needs gas to fuel its chemical plants in Grangemouth and Runcorn, Cheshire, has made no secret of its desire to enter the fracking sector and has poached experts in shale gas exploration from around the world.
It recently began a $600m (£350m) project to bring ethane produced from shale gas in the US to Grangemouth after the Unite trade union gave in to Ratcliffe’s tough demands for an end to workers’ final salary pensions, job cuts, a wage freeze and harsher redundancy terms. Ratcliffe, who has been nicknamed “JR” after the oil tycoon in Dallas and “Dr No” after the James Bond villain, had threatened to close the plant with the loss of hundreds of jobs.
Gary Hawood, chief executive of Ineos Upstream, said: “This is a logical next step for Ineos and we are very excited about it. With our large UK asset base, existing operating capabilities and exemplary safety and environmental record, we are well placed to become a major player in the UK onshore gas production sector.
“Over the last year Ineos Upstream has been drawing together a team of experts in the sector, including a number of leading shale exploration and development specialists from the US. This expertise gives us the perfect platform to move into onshore exploration.”
Ineos, which has a registered office in Lyndhurst, Hampshire but is headquartered in Rolle, Switzerland, bought the 51% stake in the PEDL 133 license area from BG Group for an undisclosed sum. The remaining 49% stake is owned by Dart Energy, which is being acquired by rival IGas Energy in a £120m deal to create the UK’s biggest shale gas explorer with a combined portfolio covering one million acres of potential fracking land.
No fracking has yet taken place in the PEDL 133 area, but Dart estimates that it could contain 4.4 trillion cubic feet (tcf) of gas. If 10% were recoverable it could be enough gas to meet Scottish demand for a year.
The PEDL 133 area covers a large part of the Clackmannan coalfield that was extensively mined in the 19th and 20th centuries and abandoned coal mines litter the area.
The British Geological Survey estimated in June that there could be 80 tcf of gas and 6bn barrels of oil in the wider area of Scotland’s central belt. However, this is a fraction of the 1,300 tcf the BGS estimated lies in the Bowland shale basin in the northwest of England.
British ministers are keen to exploit any gas resources the country has at a time when North Sea supplies are running down fast. The successful exploitation of shale in North America has sent the price of natural gas spinning downwards and triggered a resurgence in lower-cost manufacturing of chemicals and other products.
At least 10 anti-fracking protesters occupied an office building in Blackpool leased by the energy firm Cuadrilla. The demonstrators forced their way into the building on an industrial estate near Blackpool airport just before midday on Monday.
The two-storey building belongs to the Blackpool Chamber of Commerce, with the top floor rented out to Cuadrilla. According to Hugh Evans, the deputy chief executive of the chamber, the protesters “tricked” their way inside by pretending to represent a company that wanted to join his organisation.
“They broke down an inner door by rattling it. I’d say there were perhaps 12 of them and only three of us, so we decided to come out. Then they barricaded themselves inside,” said Evans, speaking in the office car park, where around 70 protesters had gathered, singing and chanting. “They broke in, so as far as we are concerned it’s an illegal occupation. They have no mandate to be here.”
No Cuadrilla employees were on site at the time, said Evans. “They’ve all taken the week off,” he claimed.