A £33bn investment is required to establish a shale gas industry in the UK, according to a new report from Ernst & Young.
The study, commissioned by the UK Onshore Operators Group (UKOOG), suggests that the spending would be used for drilling around 4,000 horizontal shale gas wells over an 18-year period, generating 64,000 new jobs.
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The study warns that the UK needs to start laying foundations immediately for the required infrastructure, supply chain standards and skills requirements, before developers begin to look overseas.
Oilfield service and manufacturing firms that provide equipment and skills for hydraulic fracturing in the shale gas development could get a £17bn boost from shale gas exploration, said the study. A further £2.3bn should be invested for steel requirement and there is also potential for a new £1.6bn rig manufacturing industry.
Ernst & Young said that the industry will need up to 50 landward rigs at peak drilling activity and a number of workover rigs along with £4.1bn of investment into other services such as waste, storage and transportation.
Ernst & Young partner advisory services and the author of the report Chris Lewis said the study shows that the opportunity from shale gas in the UK is at an impressive scale.
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By GlobalData"The current lack of a clear framework standardising the approach towards shale gas exploration as well as the lack of relevant skills need to be addressed to unlock further investment," Lewis added.
Image: The spending would be used for drilling around 4,000 horizontal shale gas wells in the UK. Photo: courtesy of FreeDigitalPhotos.net.
