Memorandum submitted by the Department of Energy and Climate Change(SG 1) Introduction UK Onshore Oil & Gas Activity in General
1. The onshore oil and gas industry has been operating in the UK for well over 60years and production, although currently only 1.5% of overall UK oil & gas total,nevertheless contributes usefully to UK security of supply and to the UK economy. 2. Close cooperation between the industry and the planning authorities has allowedthe industry to develop with minimal environmental impact. Alongside DECC licencesand consents, all exploration and development activities also need to be authorised bythe Health & Safety Executive . 3. Recent years have seen continued interest in onshore oil and gas activity as theresponse to the 13th Round in 2008 proved. That Round saw a good outcome with 97licences awarded in total confirming the continuing commercial attractiveness of onshore oil and gas exploration opportunities in the UK, and there was renewedinterest in coal bed methane. 4. Current estimates suggest that overall onshore potential proven and probablereserves equate to around 1.5% - 2% of the UK's overall reserves. Governmentwants to ensure that operators get the opportunity to explore and develop onshore -and licensing is the first part of this process. 5. There are currently some 28 UK onshore oil fields and 10 onshore gas fields inproduction. Overall UK onshore oilproduction is around 24,000 barrels per day(2009). BP's Wytch Farm field (Dorset) is the largest onshore oil field in Europe, and,although production peaked over a decade ago, the field still produces around 20,000barrels a day (around 83% of UK onshore oil production).
6. In the UK, as elsewhere, gas (and oil) is predominantly produced from permeablerock formations such as sandstones. But there have been many attempts over theyears to develop other kinds of petroleum resources. The commercial developmentof “unconventional” gas resources has been limited until the last decade, when newproduction techniques have enabled a rapid development of shale gas. 7. Natural gas can also be extracted from coal deposits by drilling (“coal bedmethane” or CBM – also known as “coal seam gas”). The energy of coal can also beexploited by gasifying the coal in the ground (“underground coal gasification” or UCG),though the gas produced is not “natural gas” (i.e., predominantly methane), but amixture of combustible gases.