IGas Still Plans to Drill 4Q Shale Well

UK onshore producer IGas said it remains on track to spud its first shale appraisal well in 4Q2018.

It had already said the well, at Tinker Lane in north Nottinghamshire in the English East Midlands, will not involve hydraulic fracturing (or fracking).

Rival shale explorer Cuadrilla, having gained consent to drill its first well in July 2018, is expected to commence fracking at its Preston New Road site in northwest England “in the next few weeks,” added IGas (the banner photo shows a Cuadrilla drill site, courtesy of that company).

In its 1H results statement on September 12, IGas CEO Stephen Bowler said: "Momentum in the UK onshore shale industry continues to build.” The UK now imports roughly half its gas needs, he argued, and import dependency would rise unless shale gas was developed: “Imported gas currently costs over £13mn [$17mn] a day - money that is not generating jobs or tax revenues in this country.”

IGas said it was granted an interim injunction in the High Court in London on September 3 2018 against any ‘unlawful interference’ in its operations in Nottinghamshire, and Ellesmere Port in Cheshire. A further hearing on October 2 will decide whether to extend it. Peaceful protest would still be possible, the firm said. Bowler added that another leading UK shale explorer Ineos had succeeded in appealing planning decisions on their exploration programme.

IGas reported a 1H net loss of £1.2mn from its continuing activities - roughly half of which was a loss on oil hedging and currency exchange. That compared with a £8mn profit in 1H2017. It added that net production (all conventional) was 2,300 barrels of oil equivalent in January-June 2018 - little changed from 2,335 boe/d in 1H2017 – and forecast to be 2,200 - 2,300 boe/d in full year 2018.

While there's no stopping shale gas exploration and production in North America, Argentina and China, the UK now seems alone in Europe to have some prospect of shale gas exploration activity.