Dart Energy

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Dart Energy is an exploration and production company working in the unconventional gas industry. As of September 2014 it is owned by IGas Energy.

One of its flagship projects is a coalbed methane (CBM) field at Airth, near Falkirk in Scotland. This will become Britain's first commercial site of coalbed methane if Dart Energy UK wins the planning inquiry that began in March 2014 after overwhelming public opposition. A final decision, which has been repeatedly delayed, is expected soon.

Dart's head office is based in Singapore. It also has offices in the UK, Germany, Belgium, Australia, Indonesia and China.

Merger with IGas Energy UK

In May 2014 Dart agreed to a merger with IGas Energy, which is listed on London's secondary AIM market, via a scheme of arrangement. [1] On 1 September 2014 IGas shareholders approved the proposed acquisition. [2]Dart Energy shareholders voted on 10 September 2014 and approved the merger.

The UK's Competitions and Markets Authority (CMA) launched an investigation into IGas's acquisition of Dart Energy in August 2014 - looking at whether the 'transaction has resulted in the creation of a relevant merger situation under the merger provisions of the Enterprise Act 2002 and, if so, whether the creation of that situation has resulted, or may be expected to result, in a substantial lessening of competition within any market or markets in the United Kingdom for goods or services..' [3] The CMA cleared Phase 1 of the merger on 20 October 2014.

Activities

Australia

Dart Energy was spun out of Queensland CSG company Arrow Energy before global giants Shell and PetroChina acquired Arrow.

Dart Energy has a portfolio of eight 'Petroleum Exploration Licences' (PELs) all located in the state of New South Wales (NSW). Following the NSW government's decision to ban coalbed methane activity within 2km of residential areas, Dart suspended all field operations in NSW on 2 April 2013 and slashed its workforce by 70 per cent, pending further 'clarity and certainty around State and Federal policies to support the industry'. It said:

The company intends to preserve its high quality licence areas in Australia until Government policies are reformulated and an initiative is underway to identify consolidation and farm-out opportunities for the Australian assets.

Nick Davies, Dart Energy's Chairman, said:

“The Board of Dart is extremely disappointed with the uncertainty created by recent NSW and Federal government decisions in relation to CSG development in Australia. The consequence is that investment is leaving the country, field operations are being suspended, Australian jobs are being lost, and the impending energy crisis in New South Wales is not being addressed, and indeed, will only get worse. This is in direct contrast to the United Kingdom, where the Government is actively seeking to support the responsible development of unconventional gas resources.”[4]

Several months later in August 2013 the Australian Securities Exchange halted trading on Dart, shortly after HSBC froze Dart's substantial loan facility, 'citing delays with their coalbed methane project at Airth near Falkirk in Scotland' and a plummeting share price. Shares were suspended at 10 Australian cents.[5] The company later announced a capital raising totalling $20.7 million, and resumed trading on the ASX in October 2013. [6]

UK

Dart's flagship project at Airth in Scotland faces strong community opposition and has been beset by delays. The Scottish press reported in August 2013 that:

The company has appealed their application for 22 new wells, a gas and water treatment facility and a network of new pipelines, to the Scottish Government on the grounds of non-determination. A public enquiry is expected to begin in the second half of October (2013). [7]

Dart Energy's website sets out its 'strategic themes' for the UK:

  • Commercialise significant volumes of already identified CBM resources and supply gas into the National Gas Transmission System ("NTS") and Local Transmission System (“LTS”) pipelines (or other monetisation solutions)
  • Identify prospective shale gas basins across the UK and develop and execute a shale exploration and appraisal program

[8]

Sites

Coal bed methane at Airth - Midland Valley, Scotland, Midland Valley Basin The Airth project (PEDL 133) covers 330 km2 in the Midland Valley in Scotland, approximately 50 kilometres northwest of Edinburgh near Stirling. It covers a large part of the Clackmannan coal field that was extensively mined in the 19th and 20th centuries.

Extensive exploration and appraisal work has been done to-date and Dart Energy has moved into early development via a small-scale pilot-to-power project during 2012, using gas produced from the Airth-12 well. This well has now been shut in, pending full field development. Full field development is currently underway, with gas supply targeted from late 2014.

Dart says it 'currently' has 'no plan to frack the coals at Airth'. However campaigners have accused it of hiding its plans to use the controversial technique, and Scottish Labour's environmental spokesperson Claire Baker MSP accused it of a lack of transparency. A submission to the Australian Stock Exchange on May 10, 2012, reveals that Dart Energy included Black Metal Shale and Lothian (Broxburn) Shale in central Scotland as part of its "shale gas prospects" in Europe. The two fields were estimated to contain a total of 2.5 trillion cubic feet of shale gas. Dart's chief executive, John McGoldrick, was quoted as saying the company planned to develop the shale gas, as it had coalbed methane.

According to its 2012 annual report, Dart has a 100% interest in the gas rights to Black Metal Shale. Dart also operates the licence for the rights to Lothian (Broxburn) Shale, although it shares ownership with the BG Group.

Project phase: Early development
Area: 330 km2
Contract award: 1 July 2004
Participants: CBM - Dart Energy 100%
Contract expiry: 30 June 2015
Contract type: Concession
Participants
CBM - Dart Energy 100%
Black Metal Shale – Dart 100%
Lothian (Broxburn) Shale – Dart 49%, BG 51% [9]

Warnings of pollution if test site goes ahead

In March 2014 respected geologist Professor David Smythe warned in the Sunday Times of potentially serious environmental damage, including contamination of streams and rivers, if plans to drill for subterranean methane are given the green light in Scotland. [10]

Wins appeal against a refusal by Wrexham County Borough Council

On 10 October 2014 IGas/Dart Energy UK won an appeal against a refusal by Wrexham County Borough Council to grant planning permission for a coal bed methane exploration well in Holt, near Wrexham. According to an IGas press release:

The planning application was turned down at a meeting of the full Council in March 2014, despite a recommendation to approve it from the Council's own Planning Officer. The Planning Inspectorate of Wales in a decision dated 8 October, has now overturned the Council's decision and allowed the appeal. The planning permission granted is for a single coal bed methane exploration well, where a sample of the coals will be taken for laboratory analysis of the gas content. [11]

Appeal for CBM application at Dudleston Heath

In 2015 Dart Energy’s appeal against Shropshire Council to the Planning Inspectorate over its application for an exploratory coalbed methane borehole at Dudleston Heath near Ellesmere was downgraded from a public inquiry to a public hearing.

The firm has insisted it will not be extracting shale gas by fracking.[12]

Partnerships

In October 2013 Dart formed a joint venture with GDF Suez to drill up to 14 wells in Lancashire and Wales in the UK exploring for both coal bed methane (CBM) — gas strapped in underground coal seams — and for shale gas. It was due to start in December 2013. GDF was accused of hypocrisy given that fracking is banned in France. [13]

Subsidiary

GP Energy, a subsidiary of Dart Energy Europe, has a 17.5% stake in two exploration licences, PEDL 139 and 140, in central England, with France's Total (40%). Other interest holders are Egdon Resources (14.5%), IGas (14.5%) and eCorp Oil & Gas UK (13.5%). IGas will act as operator for the initial exploration programme, with Total taking operatorship once the exploration starts.

Lobbying and PR firms

People

April 2013 restructure of board

  • Nick Davies , non -executive Chairman
  • Stephen Bizzell, Shaun Scott and Simon Poidevin non-executive directors
  • Norrie Stanley to join Board as non-executive independent director – UK based, former senior BP executive, extensive UK / international energy / gas expertise

Former staff

  • Mark Lappin, European boss of Dart Energy and the public face of its plan to exploit underground gas in Scotland, resigned in July 2013, moving to take up a job with Centrica in Aberdeen Scotland, where he lives. Lapping first joined Dart Energy in April 2012 as Europe general manager, responsible for progressing the company's flagship development at Airth. Before that he spent 16 years with the US oil giant, ExxonMobil, in Aberdeen, Texas and Germany.[15]
  • Senior manager, Lynne Campbell

Funding

Affiliations

  • Vitol - one of Dart's former chief executives was involved with Vitol

Contact details

Website: http://www.dartgas.com/
Twitter UK: @DartEnergyUK
@IGasEnergy from 16 October 2014

External resources

Notes

  1. Struggling Dart Energy agrees to merger with Britain's IGas Energy, Sydney Morning Herald, 12 May 2014, acc same day
  2. IGas Energy plc, Result of Annual General Meeting and IGas approval of the acquisition of Dart, Press release, 1 September 2014.
  3. Competition and Markets Authority case: IGas Energy Plc / Dart Energy Limited, GOV.UK, last updated 22 August 2014, accessed 19 October 2014
  4. Australia, Dart Energy press release, dated 4 September 2013, acc 12 Feb 2014
  5. Australian Securities Exchange halts trading on Dart Energy, newsnetScotland.com, 30 August 2013
  6. [http://data.iguana2.com/hemscott/news-item?N=759640&Code=DTE Capital Raising Completion –Entitlement Offer Significantly Oversubscribed
  7. Australian Securities Exchange halts trading on Dart Energy, newsnetScotland.com, 30 August 2013
  8. United Kingdom, Dart Energy website, undated, acc 12 February 2014
  9. PEDL 133 - Airth, Dart Energy website, undated, acc 12 Feb 2014
  10. Mark Macaskill, Dart test site raises fears of pollution, The Sunday Times, 9 March 2014
  11. IGas Energy Planning Inspector allows Dart Energy's appeal, PRESS RELEASE London Stock Exchange, 10 October 2014, acc 20 October 2014
  12. Shropshire gas drilling appeal downgraded from an inquiry to a hearing, Shropshire Star, 12 May 2015
  13. Tim Webb and Ben Webster, French energy group joins the UK rush to get fracking, The Times, Last updated at 12:01AM, October 23 2013, acc 24 October 2013
  14. Alec Mattinson, Former M:Communications staff nab energy clients for new venture Vigo, prweek.com, 11 July 2013, acc 12 Feb 2013
  15. Rob Edwards, Dart boss joins firm's exodus, Sunday Herald, 7 July 2013, acc October 2014