By Russell Bruce
In our series of articles on Power Scotland and the move to renewable energy we have targeted coal as the number one enemy for global warming. Scotland no longer generates electricity from coal. The two largest and the last to go were Cockenzie in 2013 and Longannet in 2016. England still has 4 coal-fired power stations due to be phased out by 2025. England also depends on former coal-fired plants now burning wood pellets that are now no longer recognised as renewable.
What about gas in England?
As a percentage of total generation, gas has been increasing for several years and England’s dependency has made it particularly vulnerable to the rising cost of gas. Gas takes the largest share of power generation at around 40% in the UK. England has around 30 gas-fired plants, compared to one in Scotland which accounts for just 12% of electricity generation in Scotland. Almost 50% of power generation in England and Wales is currently dependent on natural gas, four times more than Scotland.
Gas and Geopolitics
We have previously covered Europe-wide concerns over Putin’s use of gas supplies as an instrument of his particular brand of power politics. Energy has always and always will be a power game. Putin’s use of gas supplies as a political and economic weapon has brought an entirely new dimension to the ‘Cold War’. If you thought the Cold War was over Putin is keeping it alive and rather chilly.
To put this in context we decided to look at where gas came from in Europe. For this purpose we considered Russia and the wider Russian Federation as European. Russia has long been the major supplier of gas to Western Europe. So three gas producing countries to compare – The Russian Federation, Norway and the UK. Western European countries are largely dependent on these 3 countries for gas supplies. The UK no longer produces enough to meet its own needs, leaving Norway and Russia as the producers able to supply other European countries. It is not exactly an evenly matched contest.
The most important to first look at is known gas reserves
In 2000 the UK’s share of global natural gas reserves amounted to 0.7% of a Trillion Cubic Metres.(TCMs) Significantly less than Norway’s 1.2 Trillion and both extremely small compared to the Russian Federation commanding reserves of 33.2 Trillion Cubic Metres (TCMs)
Fast forward to 2020 and Norway’s reserves are up to 1.4 TCMs whilst the UK is down to 0.2 TCMs and the Russian Federation sitting on an uptake to 37.4 TCMs. To place these numbers in a global context Russian reserves amount to 19.9% of global gas reserves, Norway for 0.8% and the UK with just 0.1% of global gas reserves.
Next we looked at production levels and each country’s share of global production.
Our data source tables for this use Billion Cubic Metres (BCMs) so the numbers get bigger numerically by 1000 e.g. 0.0395 Trillion = 39.5 Billion. The UK’s best years for gas production are long over.
Until 2005 the UK produced more gas than Norway. Thereafter UK output declined and Norway’s grew substantially. UK production in 2020 was 39.5 BCMs and Norway was now producing 111.5 BCMs. Norway’s global production of natural gas amounted to 2.9% of global output and the UK’s stood at 1%. Russia produced 639.5 BCMs accounting for 16.6% of global natural gas production.
From the UK data we can calculate Scotland’s share of UK natural gas production for 2020 at 24.5 Billion Cubic Metres and Scotland’s global share at 0.063%
Russia produced 5.7 times as much as Norway and 16 times as much as the UK.
What’s the burn rate of Russian and North Sea gas?
At current production levels – Russia has enough natural gas reserves to last just over 58 years. Norway has enough reserves for 12 years 7 months. The UK has only 5 years until natural gas reserves run out. The story is a bit more complex as we shall come to, given nearly two thirds of UK gas comes from Scottish waters and Scotland is in line to take a larger production share going forward, slowing the rate of depletion.
Calculation formula: TCMs to BCMs x 1000. Russian Fed Reserves (R) 37.4 X 1000 ÷ Production (P) 639.5 = 58 years 6 months. Norway Reserves (R) 1.4 X 1000 ÷ Production (P) 111.5 = 12 years 7 months. UK Reserves (R) 0.2 X 1000 ÷ Production (P) 39.5 = 5 years Source: Statistical Review of World Energy tables July 2021 – Gas Proved Reserves, Gas Proved Reserves History, Gas Production Bcm
Global Natural Gas Reserves and Production – The Majors
Many countries have a share of global natural gas production. For this table we have isolated those who have proven reserves in access of 12 Trillion cubic metres (TCMs). These are the countries which will have most influence as the dynamics of demand pressures and global pricing play out. That will affect every country that does not have a strategy to reduce and phase out use of natural gas as part of national energy policy
The US produces enough natural gas to meet its own consumption demand with some exports of liquid natural gas to Europe, including the UK. Germany has just announced it will establish a merged liquid gas trading hub, Trading Hub Europe.
It is clear Western influence over others with the largest natural gas reserves and production output is increasingly limited. Energy geopolitical influence over a declining resource is heavily weighted towards Russia as a producer and China who will pay what it takes to secure supplies. Turkmenistan is a bit of an outlier but they have been increasing output steadily and have a close relationship with China who take almost all their natural gas (and oil) output.
Quatar, once a British protectorate in the days of such things, has somewhat complex international relations to say the least. It is a member of OPEC and the Arab League. Qatar is the world’s largest exporter of liquefied natural gas and emits enormous quantities of CO2 per capita. Human rights and involvement, along with Saudi Arabia, in Yemen, are concerns. Quatar maintains strong links with China, Iran, Turkey and the United States which would seem a complex balancing act.
Iran is not West or UK friendly. Very personal implications for Richard and Nazanin Zaghari-Ratcliffe. Iran is due £400 million for armaments never delivered following the fall of the Shah and the British government has admitted Iran is due this money because the 1500 Chieftain tanks ordered and paid for back in the 1970s were never delivered. Nazanin is a real life hostage and on the other side so is the tank money. A hostage exchange is long overdue.
How does less natural gas from UKCS affect Scotland?
In the early days of North Sea production the Southern North Sea (SNS) produced huge quantities of natural gas. With so many of these fields now decommissioned and gas pipelines removed, England is desperately trying to prevent what is left in smaller pockets from being stranded due to pipeline disconection.
That leaves the remaining North Sea areas as the main suppliers of natural gas. The Central North Sea (CNS) runs up the Scottish coastline from Berwick to John o’Groats. The Northern North Sea (NNS) covers the marine area to the east of the Northern Isles and finally West of Shetland (WoS) which is the the area with the most recent fields now producing gas and with the most unexploited potential.
We are all agreed that we need to move from oil and gas to renewables where Scotland already has a marked lead over England but it is a transition that needs to be managed. If we had no natural gas in 5 years time that would leave 65% of Scottish households with a gas boiler dependent on imported gas. England is in a pretty dire position relying on natural gas for almost 50% of power generation and 85% of households south of the border using gas for heating. Yet another reason Westminster is determined to hold on to Scotland.
Separating out the areas and fields where natural gas fields have a longer lifetime is a bit of a jigsaw puzzle. Norway reports oil and gas output for each field to make detailed analysis possible. The UK does not using that old excuse it would expose information that was commercially sensitive to individual companies. So bloody what. The needs of government energy authorities and the public right to know is greater whilst underperformers would have to answer to their investors.
There is much information we have trawled through to provide the best possible take on Scotland’s longer-term gas resources…
So here we go…
UK wide demand for natural gas was met by gas production from the North Sea from the early 1970s with demand and production closely mirrored. Then by 2005 natural gas supply from the North Sea and demand began to rapidly diverge as gas production took a nose dive. By 2018 demand stood at 80 Billion cubic metres but the North Sea was only delivering 40 Billion cublic metres. This was clear warning but it took England years to get round to investing seriously in renewables and those windmills that are ‘no use when the wind doesn’t blow’. The Tories in Scotland campaigned vigorously against windfarms but we built them anyway because we knew we would need them for power generation.
The shorter-term objective is not to ramp up UKCS gas output of a declining resource but to manage a structural change that allows investment, skills, R&D and offshore infrastructure to work together in a co-ordinated transition strategy towards Net Zero. Managing the rate of production decline whilst also working on reducing long-term demand for gas is a necessary means of closing the demand and supply gap.
After the successive privatisations of BNOC/Britoil (1982-85), British Gas (1986) and BP (1987), the UK state had no direct or indirect upstream equity participation in the UKCS, unlike Norway and Denmark. See also It’s Scotland’s Gas – a tale of two economic models.
The dry gas fields in the heyday of natural gas off the east coast of England are different from geological structures in Scottish waters where fields deliver oil, gas and gas condensates. In Associated oil and gas fields gas is separated from the oil and piped ashore via a complex pipe network to St Fergus. Scotland has a mixture of smaller natural gas fields plus the major Rhum gas field which is one of the last major gas fields with over 1 billion cubic metres in UKCS. Three Scottish gas condensate fields also contain over 1 billion cubic metres of natural gas – the giant Britannia field, north-east of Peterhead; Franklin, east of Aberdeen and Laggan, in the developing area West of Shetland.
Gas from the North Sea has been declining from all areas with the exception of West of Shetland. As of 2018 the SNS accounted for 32.6% of natural gas and the Irish Sea 0.5%. In Scottish waters CNS produced 39.1%, the NNS 13.04% and WoS also 13.04%. Natural gas output from West of Shetland only really began to show in statistics from 2016. Yet in January 2019 Glengorm in the CNS was hailed as ‘the largest gas find in a decade‘ showing there were still resources to recover in this mature production region.
New fields have begun to stabilise declining natural gas production in recent years. The SNS area (England) gained from the opening of the Cygnus field but the most significant output of natural gas production is coming from Scottish waters and set to increase Scotland’s share as part of the UKCS overall currently declining gas output. Natural gas output will continue to move northwards with Total’s discovery of Glendronach in which France’s Total E&P has a 60% share with Ineos E&P Ltd and SSE E&P Ltd both with a 20% share.
Arnaud Breuillac, president of exploration and production at Total, said: “Glendronach is a significant discovery for Total which gives us access to additional gas resources in one of our core areas and validates our exploration strategy. Located on an emerging play of the prolific west of Shetland area, the discovery can be commercialized quickly and at low cost by leveraging the existing Laggan-Tormore infrastructure.”
Arnaud Breuillac added “We know West of Shetland has significant exploration potential; some 1 trillion cubic feet of gas [28.316846712 Billion Cubic metres], which is why we’re supporting industry’s West of Shetland Area Plan to progress exploration and development in the region.”
Total’s decision to develop Laggan-Tormore and to construct the Shetland Gas Plant to process the gas was a critical step in the development of Scottish gas resources. When production began in 2016, it marked the first time that significant volumes of gas from fields West of Shetland (WoS) had been brought ashore. Total has since tied in two other fields, Edradour and Glenlivet, and the recent Glendronach discovery is expected to add to production from the area delivered via Shetland to St Fergus in the 2020s.
That’s the quick round-up of gas production from Scottish waters that will take gas supplies through St Fergus into the years beyond independence. Fuel poverty is an issue and we need time to ensure people in Scotland have access to heat and light as a right. We still have a lot to do to increase renewable energy to the level where we can phase out both nuclear power and oil and gas. If every country was as far ahead as Scotland and Norway in meeting over 97% of domestic electricity demand from renewable sources we would be much closer to meeting climate warming targets. There is much still to do but Scotland is favoured greatly by our position in the North Atlantic and copious water resources (Hydro power) to greatly expand our renewable potential.
Scotland is rapidly developing offshore wind adding considerably in the next few years to our onshore capacity. Excess to grid requirement can be diverted to pumped hydro and hydrogen production, allowing maximum utilisation of wind power without constantly shutting them down when the grid does not need the power. Tidal and wave generation has seen big early advances and investment in Scotland. Scaling these up requires several more years of R & D and investment.
This article is not advocating continuation of fossil fuels for the long term. We present our findings purely to show the sheer scale of the logistics involved and impact on and need for all of us as individuals to deal with how we will heat our homes and acquire vehicles that need no fossil fuel. Electric vehicles remain expensive with present supply constained by chip shortages.
If we were to shut down all our already declining oil and gas fields tomorrow it would make no impact on international markets. But like those parties in Downing Street it would relate to raw real personal experience – “Why does my 4 year old gas boiler not have any gas?” “Why can’t I get petrol for the car?”
Oil and gas has been important to Scotland’s economy for 50 years. Now it will play an important part in a managed transition. The sheer scale of the numbers involved is a big big challenge but Scotland is already moving steadily from fossil fuels to our renewable energy future. One of the last legacies of coal generation, the chimney at Longannet, was demolished this morning under the watchful eyes of our First Minister.
The number of gas boilers that will need replaced in the UK is a staggering 23.6 million. There are 32 million cars on the road in England, Scotland and Wales and only 370,180 pure electric vehicles to date. That is a lot of boilers and cars to replace meaning domestic gas, petrol and diesel will need to cover the transition period.
Meanwhile the energy power play from Putin is getting increasingly dangerous as he keeps back gas supplies to mainland Europe and marshalls troops and tanks on the Ukrainian border, threatening to invade.
Will recent rocketing gas prices start to fall back again?
Predicting future energy prices is fraught with danger and all we can say is there is no sign on the horizon to suggest supply of gas globally will be enough to meet global demand in the near term. Energy is reserved to Westminster so until we get total control over energy the Scottish government is limited in what it can do to ameliorate energy costs and fuel poverty.
Newsnet will always advocate a public right to food, heat, shelter, health care, education and human rights as the six rights of a civilised society. As soon as this pandemic is clearly under control we can make independence and those 6 fundalmental rights a reality.
Dealing with Gasman Putin’s bullying tactics – David Hume gave us the answer to that nearly three centuries ago, but that is a story for another day.