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63 About this deal
Cuadrilla Resources is a British company based in Bamber Bridge near Preston in Lancashire. It is privately owned between Australian company AJ Lucas (96%) and current and former Cuadrilla employees (4%). Where does Cuadrilla have licence to operate? The mineralogy of the Lancashire Bowland shale has been analysed in detail using X-ray diffraction of shale core samples and cuttings taken from the Preese Hall well. This analysis has confirmed that both the Upper and Lower Bowland shales are very well suited to hydraulic fracturing as they are formed from a highly siliceous matrix with consistently low overall clay content and not reactive clays. How much gas will the wells produce?
Friction reducer, polyacrylamide, which the Environment Agency has ruled as non-toxic and non-hazardous. Very small movements will be detected due to the highly sophisticated monitoring system in place at PNR. The British Geological Survey (BGS), which monitors seismicity at PNR, has published comprehensive information here. In particular the BGS says: It is no secret that we asked the OGA to review the TLS in December 2018 following hydraulic fracturing operations and that remains a high priority for us and other UK shale operators. The upper operating limit, set at just 0.5 on the Richter scale, was purposefully positioned at an extremely conservative level, far below anything that can be felt at surface, much less cause any damage to people or property. The Government was very clear at the time about the intention to review this limit as operational experience and data became available. Didn’t you cause earthquakes when hydraulic fracturing at Preston New Road? The work will be completed by the end of November and followed by flow testing of the well, with gas flow results expected early in 2020.
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Local people should be reassured that any resulting ground motion will be far below anything that could cause harm or damage and is likely to be much less than caused daily by other industries such as quarrying or construction or even heavy goods vehicles travelling on our roads. Once the gas is released in the tiny fractures, held open by the grains of sand, the gas travels up the well to surface. When the hydraulic fracturing is completed the flow rate of natural gas produced from each well is tested over period of approximately six months. Cuadrilla was the first operator to work within the micro-seismic Traffic Light System (TLS), regulated by the Oil and Gas Authority (OGA) and as a result have a unique data set of information and operating experience. We have said many times that the work at Preston New Road induced micro seismicity. Any movement underground is called an earthquake but as the British Geological Survey (BGS) says itself, those events detected at Preston New Road were far below anything they would normally be able to detect.
The purpose of exploration is to establish exactly how much gas a well could produce. Cuadrilla retained Anderson Thompson, a team of reservoir engineers, geoscientists and hydraulic fracturing specialists, to undertake analytical research on likely gas recovery volumes from horizontal wells to be drilled in the Lancashire Bowland shale. Anderson Thompson has broad international basin experience and specialist knowledge of the Permian, Eagle Ford, Bakken, Marcellus and Montney shale plays in North America. Once permissions have been obtained from the relevant regulators, all relevant consultees have been notified and permits are in pace, the OGA is responsible for issuing a consent to drill. The EA assess the risk to the environment and will not issue permits if the level of risk is assessed as unacceptable. They also give members of the public the opportunity to raise any issues they think they should consider through an open consultation. Operators must meet all baseline monitoring requirements set out in planning permission and environmental permits before drilling can begin and must also notify the environmental regulator of their intention to drill. Safety and well design Furthermore, other extractive industries – notably quarrying and deep geothermal – are not subject to the same restrictions as shale gas when it comes to induced seismicity and ground vibration. Given that we halt hydraulic fracturing activities at 0.5 ML, we are confident that our operations will not result in a level of seismicity that would be of a significant enough magnitude to cause damage. Why do Cuadrilla want the traffic light system reviewed?Unlike the gas-bearing shale deposits in the US, the shale resource in the UK is “heavily faulted and compartmentalised”, making it far harder to exploit at any scale. Cornelius resigned from Cuadrilla in 2014, after Lord Browne, former chief of the oil company BP, took over the chairmanship. Browne left in 2015. The company declined the opportunity to comment on Cornelius’s views. Petroleum Exploration and Development Licences (PEDLs) are issued by the Oil and Gas Authority (OGA). The licences give operators exclusive rights to explore for and extract oil and gas in a specific area but not the right to drill.
Appraisal – following data appraisal, operators may flow test the well before making further commercial decisions. This may involve undertaking one or more hydraulic fracturing procedures. Appraisal stage will typically require additional planning consent and a full environmental impact assessment. Peak Particle Velocity (PPV) provides an equivalent ground motion calculation about the impact felt at surface.Information relating to traffic management can be found within our Traffic Management Plan, which is available here. The use of the routes from the M55 junction 4 and from the M55 junction 3 are the only routes proposed for HGVs during all phases of the project.
Restoration – When all of the oil or natural gas that can be recovered economically from a reservoir has been produced, the land is returned to the way it was before the drilling operations started. Wells will be filled with cement and pipes cut off 3-6 feet below ground level. All surface equipment will be removed and all pads filled in with earth or replanted. The land can then be used again by the landowner for other activities, and there will be virtually no sign that a well was once there. On health risks, Public Health England published a comprehensive study on shale gas operations in 2014, concluding that: “An assessment of the currently available evidence indicates that the potential risks to public health from exposure to the emissions associated with shale gas extraction will be low if the operations are properly run and regulated”, see here. HOW IS SHALE GAS COMPATIBLE WITH MEETING THE UK’S CLIMATE CHANGE TARGETS? In the longer term, he said it was possible there could be a few localised operations, but they would be small and could not make a meaningful contribution to the UK’s energy needs. “They will never be at scale, because the capital costs are a huge issue,” he said. Flaring only takes place during the initial flow test stage. Cuadrilla uses an enclosed flare which conceals the flare flame. Egan welcomed the announcement this month that the moratorium would be lifted, but the company has not yet said whether it will unseal any wells.In 2017, we launched an ePortal, which provides data on our Preston New Road operations. Cuadrilla’s ePortal can be viewed here. Data relating to noise, air quality, water and traffic information can be found in the monthly reports section. HAS CUADRILLA ASSESSED ITS IMPACT ON THE ENVIRONMENT? The Committee on Climate Change recently published a report which recognises that we will continue to be using significant quantities of natural gas in the UK out to 2050 and beyond in conjunction with Carbon Capture and Storage (CCS) technology and in producing hydrogen as an alternative energy for the future. Before any oil or gas operation commences in England, operators must submit details of their plans to the Environment Agency (EA) for assessment of risks to the environment and the issuing of relevant permits. The EA’s responsibilities include: Proppant (sand) which is used to keep the fractures in the shale open once the hydraulic pressure has been released; and
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