Cuadrilla Cheered by First UK Shale Samples: Updates
(Updates with result of legal ruling in Cuadrilla's favour and Ukoog comment in final two paras)
Cuadrilla said January 12 it has completed drilling a vertical pilot well to a depth of over 2.7 km at its onshore shale gas exploration site in northwest England, and has "just commenced" the first horizontal UK shale well.
The pilot well penetrated both the Upper and Lower Bowland shale rock intervals at its shale gas exploration site at Preston New Road, Lancashire, said the company, and recovered some 375 feet of core samples taken across three separate intervals of the two shale levels. In addition it said a very comprehensive series of wireline logs had been completed, representing the "most comprehensive data set recovered to date from any shale well drilled in the UK and the quality of the data is excellent."
Using this latest data, along with data recovered and analysed from its three previous Lancashire shale exploration wells, the company said it is now "exceptionally well positioned to drill its first two horizontal wells into the gas rich zones," adding: "Our early analysis of this latest data suggests excellent rock quality for hydraulic fracturing and a high natural gas content in several zones within the shale."
It said this concurs with the British Geological Survey / Oil & Gas Authority report of 2013, 'The Carboniferous Bowland Shale Gas Study', that estimated a mid-level estimate of the gas-in-place in the Bowland shales across the North of England to be 1,329 trillion ft3 (37.65 trillion m3). However the BGS report emphasised that considerable successful exploratory drilling, such as Cuadrilla is now beginning in just a small part of the North of England, would be necessary to convert such in-place estimates into proven reserves.
Cuadrilla CEO Francis Egan said: “We are very encouraged by our early analysis of the data and confident that there is a very sizeable quantity of natural gas in the Bowland Shale. In addition we can confirm that the rock composition is very suitable to hydraulically fracture. This gives us great confidence as we start drilling what will be the first horizontal well drilled into UK shale rock.”
Cuadrilla has planning permission to drill up to four exploratory horizontal wells in the shale rock underlying its site at Preston New Road. The initial vertical sections of the first two of these wells have both now been drilled and it has just started drilling what will be the first horizontal well in UK shale: "Once both horizontal wells have been completed, hydraulic fracturing of both is likely to be in the 2Q 2018. Cuadrilla plans to test the flow rate of natural gas from the horizontal wells for approximately six months after this."
Cuadrilla, which is 45%-owned by Australian drill services firm AJ Lucas, 45% by US private equity group Riverstone, and 10% by current and past employees, faces opposition from environmental activists, with views evenly split in the local community over its activity. However it has largely cleared legal hurdles to drilling and fracking at its Preston New Road site.
UK Onshore Oil & Gas lobby group welcomed the result a few hours after Cuadrilla's statement, saying: "With the Bowland shale highly suited for hydraulic fracturing, and this latest examination of the geology showing a potentially substantial gas resource, we greatly look forward to seeing the first horizontal drilling into shale rock by Cuadrilla soon, and the fracturing and flow testing that will follow it. This is not just good news for Cuadrilla, but also for Lancashire, which has seen nearly £5mn ($6.8mn) worth of investment into its local economy and over 50 jobs created in the area since the company relocated to Lancashire in 2016.”
Update 5.30pm: Cuadrilla said later January 12 it welcomed a Court of Appeal verdict handed down by three law lords dismissing two claims made against the government's Communities and Local Government Secretary of State, Sajid Javid, over his decision to grant planning consent for its Preston New Road shale gas exploration site. It follows a hearing by the three judges in August 2017. Cuadrilla said the Court of Appeal has also refused requests for further appeal at the Supreme Court. Its CEO Francis Egan remarked: "As our lawful planning consent remains in place, even whilst the Court of Appeal case was heard, operations on site have continued to progress well. We have successfully completed our data acquisition programme in the shale and will commence drilling the horizontal sections of the first of two initial wells this weekend."
Drill rig at Cuadrilla's Preston New Road shale gas exploration site in northwest England (Photo courtesy of Cuadrilla, Jan.2018)