UK has “no choice” over shale gas
28 Mar 2014
The UK public must support shale oil and gas development if some of the country’s key industries are to survive, Ineos director Tom Crotty warned yesterday.
Speaking at a Chemical Industries Association (CIA) event in London last night, Crotty said that the use of shale gas both as a feedstock and energy source was vital for the chemicals, aluminium and steel industries, among others, if they were to remain globally competitive.
“If you want your fundamental industry to survive then you really have no choice [over the development of shale gas],” said Crotty.
“The development of shale in Europe, for the chemical industry, is a no-brainer. It isn’t a nice-to-have, it’s a must have.”
Shale isn’t a nice-to-have, it’s a must have
Ineos dircetor Tom Crotty
He warned that local opposition to exploration and the drilling of test wells – which was based on “myths” - was damaging the country’s ability to gain an accurate understanding of both the size and the quality of its shale gas reserves.
“Because we are not doing the development work we can’t yet answer the question of how effective shale gas will be in the UK,” he said.
Ineos chairman Jim Ratcliffe in December said his firm was considering entering the shale production market in the UK. At the same time the chemicals company is developing liquefied natural gas (LNG) terminals at its Rafnes plant in Norway and Grangemouth plant in Scotland to import shale-derived ethane from the US.
Crotty’s comments at the CIA event came just hours after Ineos had announced German engineering contractor TGE as the preferred bidder on the Grangemouth ethane tank build contract. TGE is already building the ethane import terminal for Ineos at its Rafnes plant.
Crotty revealed that the Grangemouth storage tank would be “twice the size” of the Rafnes tank, which is estimated to have a capacity of 17,000 tonnes, and that it was likely a supply deal, like Rafnes, would be signed with US gas firm Range Resources for a 15-year period.
The ethane tank announcement was made as part of an update on Ineos “survival plan” for its Grangemouth petrochemicals plant, following its temporary closure last year. In this announcement the firm also confirmed it was moving ahead with the closure of its old ethylene cracker (G4) and the associated Butadiene (BE3) plant at the site with immediate effect.
The firm said that these plants dated from the 1960’s and that their closure would allow the company “to concentrate on increasing the production from its much more modern and efficient KG ethylene cracker”.
