Local geographic area has 4.4bn barrels of shale oil, which could bring £93.7bn to London’s economy
London is on the doorstep of one of the country’s most promising new areas for oil and gas exploration.
There could be £93.7bn of oil within the Weald Basin,1 a geographic region directly south of London, spanning from Kent to Dorset, according to new estimates from GLA Conservative Tony Arbour.
The oil and shale gas industry has the potential to create jobs not only where the wells are located, such as a recent well found in Horse Hill Surrey worth £2 billion, but within Greater London as the industry requires a great deal of support.
Estimates show over 46,000 jobs – such as lorry drivers, geologists and hydraulic technicians – could be sustained throughout the next three decades.2
Tony Arbour, GLA Conservative economic spokesman, said:
“Despite recent scaremongering, this highly regulated industry has a great safety record in Britain, and provides a clean and more secure energy source for our local economy. Oil and shale gas has the potential to raise tens of billions of pounds for London, but that’s only if we make London the centre of this business. In the same way Aberdeen has benefited by being the centre of the British North Sea oil industry, London could benefit from this Weald Basin industry, which is on the verge of massive growth. London’s Mayor needs to work with Government and get behind this industry by promoting it to the Capital’s universities, who will be equipping our future workforce with these high-end skills.”
Tony Arbour will be urging London’s Mayor Boris Johnson, at public Mayors Question Time (Wednesday 22nd 2014 from 10am) to encourage local expertise in shale oil and gas by promoting these subjects to the Capital’s universities and hosting an industry summit.
1 British Geological Survey (BGS) estimates there are 4.4bn barrels of shale oil in the Weald Basin just south of London (https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/313701/BGS_DECC_JurassicWealdShale_study_2014_MAIN_REPORT.pdf). If current price of Brent Crude is used (£53.27 per barrel http://www.exchangerates.org.uk/commodities/live-oil-prices/BRT-GBP.html 15/10/2014), then this is worth up to £234.7bn. If 40% is recoverable this puts its actually worth at £93.7bn.
2 The UK oil and gas industry supports some 450,000 jobs across the UK (http://www.oilandgasuk.co.uk/economics.cfm) with the industry having a £31bn gross value added to the economy (http://www.ons.gov.uk/ons/rel/naa1-rd/united-kingdom-national-accounts/the-blue-book–2013-edition/the-blue-book-2013–all-tables.pdf Table 2.3). For every £69.7k gross value added one job will be created in the industry. This means this London oil and gas industry could support 1.4 million one year jobs over the lifetime of the process. Over a 30 year lifespan of the Basin they could provide 46k sustained jobs.
· Tony Arbours’ Mayor’s Question wording: “Given that prospectors have recently struck oil in Surrey, and that the well in question could alone be worth £2bn, is the Mayor receptive to the idea of further and increased oil and shale gas exploration in the London region? Does he think such a development could well make London the Aberdeen of the South?”