Refinery firm Ineos buys into shale gas business
Tuesday 19 August 2014
PETROCHEMICAL company Ineos has bought a majority share in a licence for shale-gas exploration and development in Scotland.
The company said it had acquired a 51% of an onshore oil and gas licence for the area around its refining and petrochemical complex at Grangemouth.
The remaining 49% is owned by Australian firm Dart Energy, which is at the centre of a public inquiry over plans to drill for coal-bed methane in the Forth Valley.
The Petroleum Exploration and Development Licence covers 329 square kilometres (204 square miles) of Scotland’s Midland Valley, where the British Geological Survey estimates that there are “modest” shale gas and oil reserves.
Grangemouth is being developed to import shale-gas ethane from the US, where vast amounts of unconventional gas has been extracted using the controversial process of fracking.
It is one of only four plants in Europe capable of using shale gas as both a fuel and feedstock for making other products. As well as its Grangemouth base, Ineos also runs a plant in Norway which uses shale gas.
Gary Haywood is chief executive of Ineos Upstream, the company’s new oil and gas exploration and production business, which he said has been putting together a team of experts in the sector.
He said onshore exploration is a logical next step for Ineos which the firm is “very excited about”.
He added: “Ineos is well-placed to become a major player in the UK onshore gas production sector.”
Gas extraction is unlikely to start in the near future, however.
Licences granted by the Department of Energy and Climate Change only allocate the oil and gas resource in an area to a company. Drilling or productionneed planning permission from the local council.
Mary Church, head of campaigns at Friends of the Earth Scotland, called the buyout “spin”.
She added: “Ineos bosses are cynically trying to justify the many millions of public money that they managed to wangle out of the UK Government to keep the high-carbon Grangemouth plant limping on for a few more years.”
Dart Energy is involved in a long-running dispute over its plan to drill for coal-bed methane at 22 wells in an area known as Letham Moss, which straddles the boundary of Falkirk and Stirling councils.
Dart insists it will not use fracking – the extraction of shale gas by hydraulic fracturing. However, a public inquiry into the plan between March and April this year attracted 2500 objections from residents and enviromentalists.
Dart Energy and Sepa have until August 26 to respond to the latest written submissions from campaign group Concerned Communities of Falkirk (CCoF).