How a gas goldmine under this pasture could help Osborne end debt nightmare

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How a gas goldmine under this pasture could help Osborne end debt nightmare

 The value of gas under the fields is estimated at ?136 billion
 Fracking could satisfy our national gas consumption for 60 years
 It could also generate about 40 per cent of electricity needed
 Progress has been slowed by those with 'green' environmental interests


By Stephen Robinson
PUBLISHED:00:15, 24 March 2013| UPDATED:00:16, 24 March 2013
Comments (27)

As you approach Ground Zero of Britain?s potential shale gas bonanza and alight next to a 10,000ft-deep hole dug five miles east of Blackpool, your nostrils are suddenly assailed by the overwhelming smell of methane.
At first, you think there must be some catastrophic failure of a gas pipe deep below, and you wonder if the ?fracking revolution? really can be the answer to keeping the lights on and Britain?s houses warm.
But the smell, it turns out, has nothing to do with the drilling of a gas well two miles below Lancashire farmland. The villains are cows in the neighbouring field, making their own, very distinctive, contribution to greenhouse gases.

The view from Cuadrilla plant in Preston. They estimate the value of the gas under these picturesque fields at ?136 billion
The pretty village of Singleton is an unlikely setting for what might become Britain?s natural gas bonanza ? Galveston, Texas or Qatar it emphatically is not, though Cuadrilla Resources, the drilling company, believes up to 200 trillion cubic feet of gas lies trapped below.
Cuadrilla estimates the value of the gas at ?136 billion. It could theoretically satisfy our national gas consumption for 60 years, keeping our central heating boilers going while generating about 40 per cent of the electricity we need.
It could do for us now what North Sea oil did in the Seventies. And crucially, shale gas will not leave behind the toxic legacy of our nuclear power programme. We would feel richer again, we would feel at the cutting edge of a revolution and we would lose our baleful sense of energy ennui as Blackpool becomes the new Aberdeen.
So you would have thought the Government and the environmental lobby would be delighted at the news that Britain has exploitable reserves of the shale gas that is propelling America towards energy self-sufficiency and lower carbon emissions. But you would be wrong.

The drilling rig of Cuadrilla Resources exploring the Bowland shale, which is four miles from Blackpool, for gas
When it burns, shale gas emits half the CO2 of coal, bringing the green targets enshrined in Kyoto and other treaties within sight. Surely even the Lib Dems and their ?Big Green? allies, who have profited so handsomely from the billions of pounds of carbon taxes imposed on consumers, would concede this is a breakthrough in achieving the UK?s mandated target of an 80 per cent reduction in emissions by 2050.
Fracking involves firing water into shale rock at very deep levels and at very high pressure to release gas. It does not despoil the landscape in the way coal-mining does. It does not put working men at risk from rock bursts underground, or coat their lungs with coal dust.
Once the well is dug and capped, the plant left on the site of the fracking is deliberately low-level, and scarcely visible from the road as naturally occurring gas is pumped silently into the grid. How could anyone who worries about the planet cavil at this?
Yet Greenpeace, the Green Party, and other environmental interests have responded to the shale gas opportunity as though the carbon-polluted sky had fallen in, and then they have used every trick of the planning regime to obstruct the work of Britain?s shale pioneers.
As we again turn up central heating thermostats to counter the snow  this weekend, there are warnings ? now dismissed ? that the country might run out of gas we import from Russian and Norwegian fields.
More worryingly, Ian Marchant, chief executive of SSE, Britain?s second biggest electricity supplier, accuses the Coalition of ?significantly underestimating the scale of the capacity crunch facing the UK in the next three years? as we close  coal-fired power stations to meet green targets. There is, he adds, ?a very real risk of the lights going out as a result?.

Environmental campaigners have called for a halt to the drilling of what Cuadrilla believe could be significant reserves of natural gas
Even as evidence that the planet is warming melts away like a snowball in late spring ? as documented in forensic detail in last week?s Mail on Sunday ? the Government is astonishingly complacent in attaching ever more draconian and regressive ?carbon? taxes to our utility bills.
One of the main reasons we are suffering a double-dip recession is the loss of revenue from falling North Sea oil production. On top of that, carbon taxes on our utility bills further reduce the spending power that might otherwise drive a consumer-led recovery.
We learned from the Budget statement last week that this year?s growth forecast has been halved to a feeble 0.6 per cent. Government spending and the deficit remain out of control, while debt as a share of the economy is on course to rise from a shocking 75.9 per cent to 85.6 per cent in 2016-17.
Surely George Osborne and David Cameron should be pushing through the exploitation of shale as a national economic imperative?
Yes, there was a passing reference in the Chancellor?s speech to shale gas being ?part of the future?, and ill-defined promises of local incentives to head off Nimbyist tendencies around the drilling areas.
But there was no sense of urgency,  perhaps because had Mr Osborne shown extravagant support for  a new carbon fuel source, albeit a relatively green one, the Lib Dems would have kicked up a fuss.

Protestors at the Cuadrilla site. Those with a 'green' agenda have slowed the progress of fracking in Britain
The absurdity of the situation is that gas could have been gushing out of the Singleton well, boosting the Treasury?s coffers and getting us through this freezing winter had  our reaction to fracking not been so mealy-mouthed.
In the United States, shale is hailed as a saviour, an engine of growth, the creator of 600,000 new jobs, as Barack Obama said. In Britain, it is dismissed dismally as a threat to the future of the planet.
Officially Britain?s shale gas revolution was put on hold after Big Green managed to whip up a frenzy of contrived fear about two earth tremors in 2011 when Cuadrilla was conducting exploratory fracks. The tremors registered 2.3 and 1.5 on the Richter scale, making the latter some ten billion times less powerful than the 8.9 quake that caused the Fukushima disaster in Japan.

The attitude towards fracking in Britain is predominantly sceptical, despite the U.S. hailing it as an energy saviour
One of the Lancashire tremors occurred on April 1, prompting many locals who had not noticed it to assume media reports to be an elaborate joke.
Years ago, some journalists challenged each other to invent the dullest headline ever. The winner was ?Small earthquake in Chile, not many dead?. In this case, the headline might have been ?Two tremors in Lancashire, not many noticed?.

Yet Big Green seized upon these minor seismic events and forced Cuadrilla to suspend fracking operations. The saga of the trivial Lancashire tremors sums up the vacuity of the Coalition?s energy policy. It is not even clear fracking caused the tremors ? in America, where tens of thousands of shale gas wells have been sunk, there have been almost no instances of uncontained geological activity.
Shale gas will not transform the energy market here as radically as it has shaken up the market in America, where natural gas prices have more than halved and cheap energy is encouraging manufacturing industries to come home in what has been called ?re-shoring?.

Here is a carbon-based economic prediction: The American economy will bounce back into robust growth in the next two years, its recovery fuelled by cheap, relatively green shale gas. Meanwhile in Europe, where energy prices are kept high, only stagnation beckons.
In America, you own the gas or oil underneath your property, while in Britain the revenues go to the State, so there is no financial incentive to embrace the shale revolution.

But there is another reason why we  cannot embrace the benefits of abundant, cheap, green energy. Big Green does not want British consumers to have access to cheap shale gas ? even if it reduces carbon emissions.
The narrative of the green lobby, and the one endorsed by the Coalition, is that we are running out of fossil fuels and that burning the remaining reserves destroys the planet.

The first proposition is absurd, as ever more vast reserves of shale gas and oil are discovered across Europe, Asia and Australia. The second, we now know, is bogus as the planet has stopped warming.
But the huge taxpayer subsidies to those interests behind wind and solar power are predicated on this narrative. Challenge it with the prospect of cheap and plentiful shale gas and the logic behind all the subsidies for wind and solar power collapses.

In 2011 there were two very small tremours in the area after Cuadrilla conducted some experimental fracking exercises
Renewable energy is only sustainable if fossil fuels are running out or if the Government taxes them into submission, which appears to be the Coalition?s preferred policy.
Our hills would not be despoiled with vast turbines but for the vast subsidies being handed out to the companies building wind-farms and the bribes to landowners with money expropriated from poor and middle-income earners through taxes and levies on their utility bills.

The Commons Public Accounts Committee has belatedly latched on to the fraud agreed by Ed Miliband when Environment Secretary and now implemented by the Coalition. Two months ago, the committee?s Labour chairman, Margaret Hodge, described the Government?s contracts with wind energy companies as a ?licence for the private sector to print money at the expense of consumers?.
The contracts are structured in such a way that firms receive the ?green? subsidies even if the energy goes unused. The Big Green speculators get a guaranteed return of ten to 11 per cent on contracts which, the committee said, ?appear heavily skewed towards attracting investors rather than securing a good deal for consumers?.

It is not hard to see why environmental policy so blatantly favours green energy interests. Tim Yeo, Conservative chairman of the Energy and Climate Change Select Committee, trebles his MP?s salary with his work for three renewable energy and transport firms.
And Lord Deben, chairman  of the ?independent?, official and influential Committee on Climate Change, pockets unknown amounts as chairman of Sancroft, an environmental lobbying group. Such conflicts of interest would not be tolerated across the Atlantic, where a freer energy market allows shale gas to power up the economy, cut the deficit and reduce bills.
In America, carbon dioxide emissions are falling back to the levels seen in the early Nineties, and per capita emissions are now lower than in the Sixties as power generation shifts from dirty coal to shale gas.
Market forces are making America greener and more competitive. In Europe, ?green? policies are making us poorer and our industries less competitive, while only the well-connected insiders of Big Green direct policy ? and get rich.

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