Q&A – John Blaymires
Rhiannon Garth Jones speaks to John Blaymires, Chief Operating Officer of IGas Energy, about the industry and the future of shale gas.
Tell me a bit about your background.
I graduated with a BSc and PhD in Mining Engineering from Leeds University, before starting as a Petroleum/Reservoir Engineer with Shell International, working in the North Sea and the Middle East. Subsequently, I joined Hess Corporation and the 27 years I have spent with both Hess and Shell International has seen me working all over the world. I was the Technical Director for Hess operations in West Africa and later South East Asia, with responsibility for major gas developments. I’ve now been Chief Operating Officer at IGas Energy since 2010, with a focus on UK onshore oil and gas development and, specifically, the shale gas opportunity.
What has been your career highlight?
Being able to travel the world. Meeting and working with different cultures has undoubtedly been a highlight. More recently, the opportunity to be engaged in trying to develop the fledgling shale industry in the UK has been a fascinating experience and something most engineers might never experience in their careers.
What are the biggest changes you have seen in the industry?
There are two key areas in my opinion – technology and the environmental debate. The advance in technology, both on and offshore has enabled the industry to access and unlock resources from increasingly difficult horizons. Offshore, we see fields being developed from beneath many thousands of feet of water while, onshore, the success of the shale story in the US is being extended through increasing efficiency and technology application. Shale wells that took 17 days to drill 2,600ft as recently as 2007 are now being drilled to 5,400ft in six days.
The second aspect is the environmental debate, which is something the industry has to learn to engage in more effectively. It is clear that the world cannot replace fossil fuels in the short term but the industry has to respond more effectively to the concerns raised and be more transparent in providing reassurance to the public that it can operate safely and in an environmentally responsible way.
What do you think about the current state of the industry, and what will pose the biggest challenge in the next decade?
When you weigh up the benefits that shale gas might bring to the UK, you notice that the opportunity that we’re sitting on is potentially vast. However, as things stand, we’re in a position where we’re very dependent on public opinion in order to get things moving in the right direction and, even with a supportive government, we need to earn the social licence to operate. I believe we can eventually overcome the opposition to the establishment of a shale gas industry through rigorous adherence to and compliance with the regulatory regime and through the adoption of best practice.
The decarbonisation impact of switching from coal to gas in electricity generation, so startlingly demonstrated in the US, is also overlooked, while the wider need for gas as an industry feedstock is often forgotten or poorly understood. The beneficial carbon impact of the transportation of gas, along with the benefits of secure supply close to home, are ignored, while shale gas is accused of supplanting investment in green technologies. It’s easy to rail against the injustice of these claims and the inaccuracies they include, but it will not stop those views being propagated. The industry needs to embrace the challenge and inform our neighbours with well-reasoned, independent data that is peer-reviewed and carefully and sympathetically shared.
At the moment, the UK remains a significant, yet untapped, shale market. We have an opportunity to lead the development of that market and contribute specialised equipment, people and skills that could be deployed across Europe.
Over the next 10 years, assuming shale gas in the UK is successful, the biggest challenge we will face would be creating a supply chain that supports a competitive onshore UK gas industry in the future. If we don’t train people and ensure we have the skilled workforce and capability the industry needs to progress, then those opportunities will be lost to already skilled overseas competitors without the UK experiencing any of the benefits.
What do you think is most significant in the debate about shale gas in the UK?
The shale gas debate can be split into two broad categories – the climate change issue and the local socio-economic discussion. Both are frequently underpinned by a lack of rational factual debate.
Irrespective of the arguments for or against climate change, there is logic in seeking to decarbonise the global economy. The obvious place to start is to decrease the burning of coal. The opponents of shale gas will acknowledge that consumption of shale gas (which is no different to conventional gas) is much less damaging to the environment than burning coal. However, a large part of the NGO opposition to shale gas is the fear that because of its abundance (and hence lower cost) it will restrict the advance of renewable technology that are reliant on continued subsidies to be attractive.
We will still require gas to heat our homes and cook our meals for decades to come – the issue is not a binary one, it is not renewables or shale gas. To me, the obvious solution is that both renewables and shale gas form part of an integrated energy policy designed to provide security of supply at affordable prices that can also meet the overarching goal of addressing the climate change concerns.
The local debate is between the desire for energy security and the jobs and economic benefits associated with a vibrant and successful shale gas industry versus the local impact of the activity. The debate manifests itself in many ways, and the industry is often misleadingly portrayed as being unsafe, unregulated and responsible for a number of environmental consequences. The debate usually occurs over social media, and it is often difficult to separate fact from perception.
Often, the accusations levelled at fracking for causing environmental damage are taken from other countries where regulation is much less stringent. In the UK, we have an exemplary regulatory regime – we’re regulated by the Health and Safety Executive, the Department of Energy and Climate Change and the Environment Agency as well as the local council, the Mineral Planning Officer and, ultimately, the local community. If we continue to uphold high standards of well integrity and operating practice, I believe fracking can take place safely and effectively.
What do you think is the strongest argument for shale gas?
It has to be security of supply. We’ve seen how the US energy market has been completely transformed by shale gas – the Marcellus field alone produces 113BCM per year. This is roughly equivalent to Russia’s exports to Europe through the Nord Stream, Yamal, and Brotherhood pipelines.
We’ve been heavily reliant on North Sea gas for many years but reserves are now beginning to dwindle. There’s around 18tcf of gas left in the UK’s North Sea sector, yet the UK consumes roughly 3tcf of gas per year. With only six-to-seven years of the UK’s gas requirements left in the UK’s sector of the North Sea, self-sufficiency seems a practical solution.
Energy self-sufficiency would mean we’d be investing internally and wouldn’t run the risk of falling victim to fluctuating international gas prices or shortages. If the industry isn’t developed in the UK, the danger is that we’ll miss opportunities here, and jobs and developing technology will move abroad. The size of the prize is potentially huge, not just in terms of recoverable gas but the positive impact on jobs and the economy. Also, we should not underestimate the decarbonising effect of locally sourced gas.
What do you think the industry can do to progress the debate on shale gas?
I think that, as an industry, we’ve been slow at communicating and, specifically, to embrace the advent of social media and its impact. Not unlike many other well-established hi-tech industries, we have trusted in our long track record of conducting our business safely – there are more than 2,000 onshore oil and gas wells in the UK and we have been producing without incident for more than 60 years. With hindsight, we should have been extolling our virtues and the benefits derived from our product so that the wider population better appreciated the importance of the industry and how it impacts their lives. In the absence of that narrative, there’s now a whole realm of misinformation readily available.
The industry has to try to rebuild the trust and respect, particularly within the communities where it conducts its operations. This requires effective engagement and liaison, based upon transparency and maintaining the highest operational practices and environmental standards in all that we do. The areas where we operate, whether greenfield or brownfield, rural or industrialised, are neighboring people’s homes. It’s where they live, and they have a right to understand what it means for them. This ranges from environmental impacts to noise and traffic movements to jobs and local services.
The industry needs to embrace the challenge and inform our neighbours with
well-reasoned, independent data that is peer-reviewed and carefully and sympathetically shared.
Do you have any comments on the current and future UK energy mixes?
I think we’re all very aware that in the long-term, there’ll be a big shift towards renewable energy – not just driven by our current energy supplies becoming less effective, but from an environmental perspective, too.
I believe that in the short term – for instance, the next 25 years – natural gas (including shale gas) will continue to be a big player in the UK’s energy mix, helping bridge the gap between a dwindling North Sea oil supply and a renewable energy future which will take time and funding before it becomes a reality, because we already have the technology and experience in place to allow it to develop. However, we have to bring the population with us, and to earn that social license to operate we have to listen, inform, reassure, and give something back.
What do you think is most significant in the debate about #ShaleGas in the UK? Tweet us your responses.
What you’ve already said:
@burngold that it needs to be determined whether the ecowarriers/nimbys are listened to? Or ignored? If former it’s a no go! #ShaleGas