The Scottish Government has today confirmed that the boss of the pro-shale gas exploration company was meeting with First Minister Nicola Sturgeon at the same time as her Energy Minister was publicly announcing a temporary moratorium on shale gas exploration by ‘fracking’ technology.
While the meeting – on 28 January 2015 between Sturgeon and Jim Ratcliffe, Owner and Executive Chairman of INEOS – on the same day that Fergus Ewing, Scottish Energy Minister announced the Scot-Govt moratorium on fracking to recover shale gas, is not against any rules, it has opened her up to political attack.
Tomorrow (3 March) Labour backbench MSP Neil Findlay is due to raise the issue at First Minister’s Question time in parliament via an initial question asking: “What is the Scot-Govt’s position on fracking?”.
Scottish Energy News would like to be able to bring you a news report of this FM Question Time from Holyrood tomorrow. But the Scottish Parliament’s chief clerk, Paul Grice has banned Scottish Energy News from Holyrood on the specious grounds that we are not ‘real’ media. Watch this space for further developments
The Scottish National Party is as divided on shale gas as the Tory party is on British independence from the Euro-Union. The party’s national executive managed to keep the subject off the agenda at its last conference after announcing that the SNP-led Scot-Govt. is seeking independent scientific evidence on public safety and health grounds for, or against, shale gas recovery.
This evidence-led consultation is due to report by Spring 2017 – long after this year’s Scottish general elections to Holyrood.
INEOS formally welcomed the moratorium announcement by the Scot-Govt. INEOS has also publicly stated that it wants to be the biggest shale gas operator in the UK and has already secured UK Dept of Energy petroleum exploration development licences (known as ‘PEDLs’) for large tracts of sub-surface recovery across the Central Belt.
Energy industry observers say this is because INEOS is confident that the independent science will prove that shale gas can be economically and safely recovered and because it has the commercial time to take a ‘long view’ to let the SNP get past the Holyrood elections in May 2016 without internal party warfare breaking out into open battle over fracking.
This is the official statement issued today by the Scottish Government on Sturgeon’s meeting with INEOS on 28 Jan 2015:
First Minister meeting with Jim Ratcliffe and Tom Crotty on 28th January 2015
Ineos were extremely positive about the future of the plant, and view current industrial relations as positive. The construction of the ethane tanks and import terminal at Grangemouth, and the export terminal in US are on track for completion in 2016. Ineos have signed long-term contracts (10-15 years) for Ethane supplies from Marcellus Shale (Pittsburgh, US), and orders for eight transportation ships are progressing as planned. The ships are being built in China, with the first ship due for completion in May 2015.
The US Ethane supplies will reduce the reliance of gas supplies from the North Sea, though Ineos will still continue to utilise North Sea gas while available. Ineos are of the view that Ethane supplies from the US will keep the petrochemical plant competitive over the medium term, and also indicated that due to investment in plant kit and infrastructure, the site compared positively to many of their competitors.
In long-run, Ineos believe the exploitation of unconventional resources in Scotland/UK are vital for both energy supplies and feedstocks. Ineos understood, though didn’t agree, with current public opinion on fracking, and outlined their belief that gas power stations will be essential for energy and heat supply over the medium to long term. They made this observation in the context of:
- cost and unreliability of onshore and offshore wind;
- expense and lack of public acceptability around nuclear power; and,
- emissions associated with coal power stations.
Ineos also made the observation that the Pittsburgh economy has been transformed due to the US Shale revolution – with significantly more jobs and prosperity in the region compared to 20 years ago. Ineos said the Marcellus Shale was producing 18 bcf of gas a day, substantially more than the total daily demand across the UK (eight bcf).
Ineos agreed to engage in SG consultation, and also said they would undertake their own series of public engagements on their plans for shale licenses in the central belt (PEDL’s 133 and 162). Ineos have bid for other licences across the UK, though not in Scotland. They indicated that PEDL’s 133 and 162 held the main shale resources across the Midland Valley, and anything else in Scotland was relatively small in comparison. [Redacted]
North Sea Investment
Ineos said they had a positive response to their recruitment advert [Redacted]. They believe the business model used for their petrochemical business is applicable to some older assets in the North Sea. [Redacted] They suggested that the current oil price is beneficial for their immediate plans in the North Sea.
This is a copy of the Scottish Government statement announcing the shale gas moratorium – also on 28 Jan 2015