China’s interest in shale drilling

Cuadrilla at Preese Hall

Cuadrilla at Preese Hall

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BLACKPOOL’S shale gas reserves could become part of China’s growing energy resources after close ties between one of Cuadrilla’s main backers and the China National Offshore Oil Corporation (CNOOC) were revealed.

Cuadrilla recently announced it believed the amount of shale under the Fylde coast was the largest deposit in Europe – and could create 1,700 jobs on the coast.

The firm estimates there is 200 trillion cubic metres of the gas in the Bowland shale. The exploration group announced the shale gas could be worth millions of pounds in taxes to local authorities and billions to UK industry as a whole.

Now, Kerogen Capital, a Hong Kong-based funding body, and CNOOC, are believed to have taken a large stake in AJ Lucas, a firm which owns 40 per cent of Cuadrilla.

Private equity firm Riverstone, headed by former BP boss Lord Browne is believed to own a further 40 per cent of the firm.

A Cuadrilla spokesman confirmed a Chinese company had invested but declined to comment further.

The firm has been told to stop test drilling on the coast while investigations are carried out after two small earth tremors hit Blackpool.

The controversial fracking technique – which involves pumping chemicals into the rock to force it to release gas – has been banned in some US states and France.

Protestors say the process can cause many problems – including gas emerging from water taps – but Cuadrilla bosses insist the process is safe.

And Cuadrilla CEO Mark Miller has told The Gazette he believes shale gas could have the same impact on the area as North Sea oil had on Aberdeen in the 1970s.

He added: “The most positive thing is this is a new industry from the private sector.

“This is going to create highly skilled jobs – that’s the biggest news and what it really brings to the community.

“This is not short-term, it is long-term and will build a real talent base of people.

“And we’re encouraging the people who work for us to start looking here for bases, so rather than have these people coming from Germany or Aberdeen we want to see them coming from here.”

Cuadrilla will confirm next summer whether it does want to drill commercially in Lancashire and, subject to securing Department of Energy and Climate Change approval and planning permission, hopes to start work in 2013.