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First US Shale Gas Arrives in Britain

First US Shale Gas Arrives in Britain

Sept. 27, 2016
The gas shipment will help make up for dwindling offshore supplies which once flowed in abundance from the North Sea but have become increasingly difficult and costly to extract as wells have matured.

A tanker carrying the first shipment of shale gas from the United States arrived on Sept. 27 in Britain, where North Sea gas supplies are dwindling and there is fierce public opposition to fracking.

The ship carrying 27,500 cubic meters of ethane arrived at Grangemouth, a sprawling energy complex on the River Forth west of Edinburgh, but was not able to dock due to high winds.

The shipment of Pennsylvania gas arrived in Scottish style, a lone bagpiper playing from the tanker's prow as it passed under the Forth's iconic 19th-century railway bridge.

A £2 billion (US $2.6 billion) investment by Ineos, the world's third largest chemical company, will create a "virtual pipeline" with eight tankers transporting regular shipments across the Atlantic Ocean to Britain and Norway.

"There simply is insufficient raw material coming out of the North Sea to run Grangemouth," Ineos chairman Jim Ratcliffe told a press conference.

The gas shipment will help make up for dwindling offshore supplies which once flowed in abundance from the North Sea but have become increasingly difficult and costly to extract as wells have matured.

North Sea oil production hit a record low last year as the global oil price plummeted.

They have since risen, going up more than 10% in 2015, according to the sector's annual report.

A new shipment of gas will arrive every three weeks at Grangemouth, where it will be broken down using a chemical process called "cracking" and used to make plastics for bottles, pipes, cabling, insulation, food packaging and pharmaceutical equipment.

The deal is expected to support thousands of jobs in Scotland but the controversial method of extracting the gas, known as hydraulic fracturing or "fracking", has divided political opinion and caused a headache for Scottish First Minister Nicola Sturgeon.

Scotland has a moratorium on fracking.

While the British government has given the go-ahead for projects in the rest of the country, none are currently under way, often due to lengthy local planning procedures and legal action.

One project won approval in May as councillors in Yorkshire, northern England, gave the go-ahead to a plan by shale company Third Energy but work has yet to begin.

Fracking 'Hypocrisy'

Ineos chairman Jim Ratcliffe said the import deal has secured the future of Grangemouth, which was on the brink of closure only a few years ago.

"This is a hugely important day for Ineos and the UK. Shale gas can help stop the decline of British manufacturing and today is first step in that direction," Ratcliffe said.

"We're talking about 10,000 jobs in total that depend on that Grangemouth facility, so if it were not for the shale gas we are bringing in from the USA, Grangemouth would have closed three years ago."

Ratcliffe has accused the Scottish government of "hypocrisy" by brokering a deal to save the plant but then leaving it dependent on US imports by refusing to allow fracking in Scotland.

Think tank Reform Scotland in a report this month said the ban is "not logical" given the Scottish government's support for offshore oil and gas.

The Scottish government said it had commissioned reports into fracking "to inform our evidence-led approach" whose results are expected later this year.

Fracking is credited with reviving the fortunes of U.S. "rust belt" states that had fallen into industrial decline by the turn of the century, but campaigners say this has come at the cost of damage to the environment, human and animal health, safety, property value, and quality of life.

U.S. shale is facing a similar backlash in Scotland.

The Friends of the Earth Scotland campaign group said Grangemouth was being propped up "on the back of human suffering and environmental destruction across the Atlantic."

Jim Ratcliffe, a lawmaker from the Scottish Greens, accused Ineos of "bullish behaviour" and said Grangemouth should be converted to renewables.

By Mark McLaughlin

Copyright Agence France-Presse, 2016

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