IGas Chief Predicts 'UK Shale Gas Within Three Years'

The head of a major UK energy company, IGas, has predicted that indigenous shale gas extracted by hydraulic fracturing will be a feature of the British energy scene within three years.

Andrew Austin, chief executive of IGas, said commercial production of shale gas from his company's UK locations is drawing closer.

IGas plans to drill two exploratory wells before the end of the year, Austin said in an interview in London. The company will have gas-in-place estimates by the end of May, after which a decision on where to drill can be made, he said.

Westminster is preparing tax breaks to encourage exploration for shale gas after Chancellor (Finance Minister) George Osborne made two announcements about government support for the unconventional sector.

“The government is getting to a position to make shale happen,” Austin told newsagency Bloomberg. The tax breaks are “likely to be similar to other field allowances used to stimulate development” across the UK Continental Shelf, he said.

Last week IGas confirmed it plans to drill at two further sites in the Bowland shale area of Lancashire in western Britain. Rival Cuadrilla Resources has already started work in Lancashire, although that is currently suspended.

The company has estimated the volume of “gas in place” was near 10 trillion cubic feet (tcf), which could make up a large amount of Britain's yearly demand for natural gas, at its prospects in Lancashire and Cheshire. Austin told the Daily Telegraph that the shale gas they expect, along with coal bed methane gas it is extracting, could together “power about 15% of the UK’s homes for 30 years”.

IGas is seeking a partner with which to drill further and develop the shale resources.