IGas Energy

Former UK prime minister David Cameron visiting IGas UK operations in 2014

IGas Energy Ltd is Britain's largest independent oil and gas explorer and developer, with licences to explore for oil and gas across the country including the North West, East Midlands, the Weald Basin in southern England and the northern coastal area of the Inner Moray Firth in Scotland.

In May 2014 IGas bought rival producer Dart Energy, which holds licences to produce gas from coal seams in Scotland. The deal, worth £120 million, made IGas the UK's biggest shale gas explorer at the time with more than a million acres under licence.

IGas is owned by its founding executives, investment funds and the Beijing-based China National Offshore Oil Corporation Ltd (CNOOC), which holds nearly 20 per cent. In February 2019 IGas announced that its chief operating officer, John Blaymires would retire, after 8 years with the company.

In March 2015 IGas agreed a deal with chemicals giant Ineos to sell it a 50 per cent interest in seven of IGas’ shale gas licences in the North West along with the option to acquire a 20 per cent interest in two further IGas licences in the East Midlands. The deal is worth £30 million in cash and a further £138 million commitment to fund a two-phase work programme to develop the sites.

IGas began drilling in November 2018 at its Tinker Lane shale gas exploration site near Blyth in north Nottinghamshire after an 80-hour lock-on protest blocking the site entrance. It was the first shale gas well to be drilled in Nottinghamshire.

By December 2018 IGas announced that its drilling tests had failed to find the target Bowland Shale and that it planned to abandon and restore the Tinker Lane well and site. Test drilling at IGas' Springs Road site was more successful according to an early February 2019 press release:

Drilling operations at Springs Road-1 are progressing well. We have encountered shales on prognosis, at c.2,200 m, including the Bowland Shale horizon and coring will commence imminently. The rate of drilling at Springs Road has been quicker than anticipated, building on our learnings and operating efficiencies from Tinker Lane and augurs well for the future.

Injunctions against protesters are in place at IGas's Tinker Lane, Springs Road and Mission Springs sites.

Shale gas a 'game-changer' for Britain

IGas announced back in 2014 that shale gas would be a 'game-changer' for, arguing that it could be 'extracted cleanly and safely'.

Igas's chief executive at the time Andrew Austin described hopes for UK fracking as 'a very big prize' - whereby in the 'best-case scenario' up to 10 per cent of the UK's gas supply for the next decade could come from shale gas produced in Lincolnshire and Nottinghamshire.

IGas was already producing conventional oil and gas in the area, and said it hoped to develop up to 15 fracking sites over that period.

Injunctions against protestors at UK fracking sites

Igas Energy's shale gas plans were met with extensive protest in the areas it proposes to work in. Following INEOS' successful applications for anti-protest SLAPP style injunctions, on 3 September 2018 IGas obtained a High Court injunction against 'unlawful protest' at three of its exploration sites in the Midlands and Cheshire (Springs Road and Tinker Lane in Nottinghamshire and Ellesmere Port in Cheshire).

The interim injunction was renewed in the High Court in London on 28 December 2018 (right) by HHJ Simon Barker QC.

IGas claims the order ‘doesn’t prevent anyone effectively exercising their rights to freedom of assembly and freedom of expression’. Restrictions prohibited "trespass on IGas’ land, unlawful interference with access to IGas’ land, and obstruction of the highway – including slow-walking, lock-walking, lock-ons and truck surfing". Any activists disobeying the injunction may be held to be in contempt of court and subject to prison, fines or seizure of asset. .

Cheshire public inquiry January 2019

Igas' plan to ‘flow test’ its existing well in Ellesmere Port was overwhelmingly rejected in January 2018 by local council planning committee members by 10 votes against the lone vote of chairman Cllr Alex Black (Lab, Hoole).

The company is appealing the council's decision and claims it does not intend to use hydraulic-fracturing at Ellesmere Port. A week-long public inquiry held in Chester in January 2019 heard evidence from expert witnesses on the potential health and social impacts of IGas' proposed operations at the site. DrillorDrop reports that Professor Andrew Watterson of Stirling University, giving evidence on behalf of Frack Free Ellesmere Port and Upton (FFEP&U), argued that Igas was using the 'absence of evidence' as evidence of absence.' "Nothing in the IGas appeal documents deals effectively with public health objections to the proposal,” he said. The campaigners also argue that while IGas' claims it will not frack, 'the proposed use of acid to stimulate gas flow meets the council’s local definition of fracturing'.

“From a public health and air quality impact perspective, the IGas proposal does not appear to demonstrate sustainable development but rather the opposite. Not all the project hazards were initially identified or have been fully now. The effects of these hazards combined, and with other hazards in the area, has not been fully factored in to risk assessments of human health.”

Professor Watterson explained that IGas had also not fully considered the vulnerability of the local population of Rossmore and Ellesmere Port Town, one of the country's most deprived areas. Another expert witness, academic Dr Anna Szolucha, said IGas' had a poor record of public engagement', with many residents regarding local consultations as inadequate, also perceiving the IGas scheme as 'unfair' and that 'any potential economic benefits would not compensate for potential adverse impacts'. These communities, she argued, were experiencing 'a collective trauma' and 'felt powerless, depressed, with a sense of loss, fear, betrayal, guilt and anger'.

Activities

IGas London office, 7 Down Street

IGas produced approximately 3,000 barrels of oil and gas a day from over 110 sites across the country in 2013. Primary production areas covered the East Midlands (Welton and Gainsborough), Cheshire, Flintshire and Staffordshire, as well as in the Weald Basin in southern England. At the time, IGas estimated that within its own licence area, covering 300 square miles between Manchester and Liverpool, there is likely to be in the region of 102 Tcf of gas in place (midcase). Britain’s total gas use currently runs at 3 Tcf a year.

In the year to 31 March 2013, IGas produced over 901,000 barrels and achieved £68.3 million in revenue.

By 2018 this had dropped to an average net production of 2,365 barrels of oil equivalent per day.

Criticism

In February 2014 Barbara Keeley, UK Labour MP for Worsley and Eccles South described IGas's potential fracking site at Barton Moss in Salford, Greater Manchester as 'manifestly unsuitable', with drilling there causing 'absolutely huge inconvenience' to residents and businesses. She also described the process of 'fracking' - exploring below the surface for possible shale gas reserves - as "controversial and untested".

Keeley, in an interview with Govtoday, insisted the scheme should "never have been brought into that part" of the region, adding: "If you think that there are meant to trillions of cubic metres of shale gas said to be in the north-west, why start in an urban area with very poor access?"

Political access

Attendee at UK energy minister's May 2018 shale gas roundtable

Energy minister Claire Perry hosted a roundtable with the fracking industry just hours before she gave evidence to a committee of MPs on the Conservative government's proposed changes to relax the rules on shale gas development in the UK.

A 'reconstructed' attendee list was released under the freedom of information act to North Yorkshire resident Jonathan Bales following an internal review of the Department for Business, Energy and Industrial Strategy's initial almost completely redacted FOI response.

Oil and gas companies at the roundtable included:

• Aurora Energy, BP, Cuadrilla, IGas, Ineos, Third Energy and lobby group UK Onshore Oil and Gas.

• Service companies: Ground Gas Solutions, Marriott Drilling, Onshore Energy Service Group, Zetland Group.

• Investors and fund managers: Riverstone (a major partner in Cuadrilla), Kerogen (investor in IGas), Global Natural Resource Investments (formerly part of Barclays which invested in Third Energy), KKR, JP Morgan.

Other industries and organisations: Chemical Industries Association chemical company SABIC, Coalfield Regeneration Trust, Engineering Employers’ Federation, GMB.

Licences

• IGas has a petroleum exploration and development licence (PEDL) for the Gainsborough area, but has yet to drill any wells or apply for permission to start fracking in the East Midlands.

• East Midlands – PEDL 139/140: In 2014 IGas signed a farm-out agreement with Total E&P UK Limited (“Total”), under which Total acquired a 40 per cent interest in the 139/140 Licences. Total will fund a fully carried work programme of up to US$46.5m, with a minimum commitment of US$19.5m. IGas was appointed operator on the Licences with an increase in equity interest to 14.5 per cent.

• North West: IGas has seven onshore licences, located in the counties of Cheshire, Flintshire and Staffordshire, that contain the Carboniferous Coal Measures and Bowland-Hodder shales. The total area under licence in this region is 1,020km2 (approximately 252 k.acres), where it owns 100% working interest in all licences. Drilling of an exploration well at Barton Moss near Manchester began in November 2013 and was completed in March 2014 and on budget. IGas stated:

The well is now suspended and 'full laboratory analyses of the cores is underway the results of which are expected in the late Autumn (2014). The results from the core analyses together with thewireline log data will be integrated and utilised to determine the next steps in the appraisal process. The core data will be very beneficial in understanding the geomechanical aspects of the shales and this will help provide key data to optimise the design of any future programme involving hydraulic fracturing of the Bowland Shale.

Constituencies including IGas licences

• Arundel and South Downs – Nick Herbert
• Barnsley Central – Dan Jarvis
• Barnsley East – Michael Dugher
• Bassetlaw – John Mann
• Bognor Regis and Littlehampton – Nick Gibb
• Chichester – Andrew Tyrie
• Congleton – Fiona Bruce
• Crewe and Nantwich – Edward Timpson
• Don Valley – Caroline Flint
• Doncaster Central – Rosie Winterton
• Doncaster North – Ed Miliband
• East Surrey – Sam Gyimah
• Eddisbury – Antoinette Sandbach
• Gainsborough – Edward Leigh
• Hemsworth – Jon Trickett
• Louth and Horncastle – Victoria Atkins
• Newark – Robert Jenrick
• Newcastle-under-Lyme – Paul Farrelly
• Normanton, Pontefract and Castleford – Yvette Cooper
• North Shropshire – Owen Paterson
• Rother Valley – Kevin Barron
• Rotherham – Sarah Champion
• Scunthorpe – Nic Dakin
• Sheffield Central – Paul Blomfield
• Tatton – George Osborne
• Wakefield – Mary Creagh
• Wentworth and Dearne – John Healey

Coal Bed Methane (CBM) pilot

IGas started commercial sales of electricity generated from CBM in 2009. According to the IGas website:

The Doe Green pilot Coal Bed Methane (“CBM”) site continues to produce gas and generate electricity. All three production wells, each of which is testing a separate seam, demonstrate that gas is flowing from the seams.

As of 2017 this site was operated by Ineos Shale.

Community liaison groups

• Tinker Lane Community Liaison Group - IGas made the minutes from this group available throughout 2016, last available dated 12 February 2018. The group itself publishes a variety of information on its website, and a summary of its last available minutes is dated 9 February 2019.

People

• Stephen Bowler CEO since 2015 and previously chief financial officer. Steve started his career at Touche Ross, now Deloitte, where he qualified as a chartered accountant.

• Ann-marie Wilkinson - head of communications

Former executives

• Andrew Austin -Ex-CEO and founder of IGas. Was an executive director from 2004-15 and CEO from 2007-15 with full time responsibility for the day to day operations and business development. Holds a 5.41% shareholding in IGas.Now at Rockrose Energy.
• John Blaymires chief operating officer for eight years to February 2019. Blaymires' international experience in the oil and gas industry before joining IGas had including working at Hess Corporation and Shell International.

Board

• Francis Gugen - Non-executive chairman. Francis is a founder and non-executive chairman with over 30 years of oil and gas industry experience. Holds a 13.4% shareholding in IGas
• Robin Pinchbeck - appointed non-executive director July 2012. Pinchbeck began his career at BP where he held various management roles over two decades. He was CEO of operations services and then group director of strategy at Petrofac.
• John Bryant - Senior Independent Non-Executive Director. John is the Chairman of AIM listed Weatherley International plc, and a board member of AIM listed China Africa Resources Plc.
• Cuth McDowell - non-executive director and chair of the Audit Committee appointed December 2012. Has 33 years of international experience in the oil and gas sector, having held a range of leadership positions in Exploration and Production.

Company directors

• John Blaymires, director, 19 Oct 2010-
• Andrew Austin, director, 27 Dec 2007-15
• John Bryant, director, 5 May 2004-
• FRANCIS ROBERT GUGEN, director, 27 Dec 2007-
• STEPHEN DAVID BOWLER, director, 1 Nov 2011-
• ROBIN HUNTER PINCHBECK, director, 11 Jul 2012-
• inactive JOHN GREER BUTLER, secretary, 14 Jan

Affiliations

• Associate Parliamentary Group for Energy Studies
• All-Party Parliamentary Group on Unconventional Oil and Gas, associate member. Gave a contribution of £3000 from Igas Energy PLC (registered May 2014).
• According to the Salford Star in February 2014, 'Peel Holdings, or the Peel Group, not only own Barton Moss Road but all the fields surrounding it, including the iGas drilling site, and Barton Airport where the police are based during operations, drawing rent off all of them. It now appears that the company... is preparing to evict anti-fracking campaigners.
• Member of D Group

Lobbying and PR firms

• Lexington Communications provided UK public affairs consultancy services to 'Island Gas' from 2011- August 2014.
• MHP Communications provided UK public affairs consultancy services to IGas Energy from 2014 - Rupert Trefgarne, Andrew Leach and Barnaby Fry - 2015
• Bellenden Public Affairs
• Kreab Gavin Anderson provided UK public affairs consultancy services to IGas Energy from June 2011 until May 2013.
• Vigo Communications

Subsidiaries and acquisitions

• On 28 February 2013, the Company completed the acquisition of PR Singleton from Providence Resources plc
• December 2013: Acquisition of Caithness from Caithness Petroleum plc for £7.9m (including assumed borrowings and closing adjustments) which was financed by issuing 7,488,301 Ordinary Shares.
• Acquisition in 2011 of Star Energy and equity fundraising of £20.6m.
• Signed an agreement with Nexen Petroleum UK Limited to acquire Nexen Exploration UK Limited, making our Group the operator and sole owner of all our licences.

• Island Gas Limited Exploration for and evaluation, production and marketing of oil and gas
• Island Gas (Singleton) Limited Production and marketing of oil and gas
• Island Gas Operations Limited Electricity Generation
• IGas Energy (Caithness) Limited Production and marketing of oil and gas
• IGas Exploration UK Limited Production and marketing of gas
• Star Energy Group Limited Service Company
• Star Energy Limited Service Company
• Star Energy Weald Basin Limited Processing of oil and gas
• Star Energy Oil and Gas Limited Service Company
• Star Energy (East Midlands) Limited Dormant
• Star Energy Oil UK Limited Dormant

Financials

• Barclays, banker
• Ernst & Young, auditor
• MoFo Secretaries Limited, Company Secretary
• NOMAD and Joint Broker Jefferies Hoare Govett, Nominated Adviser and Broker
• Computershare Investor Services plc, Registrar
• Macquarie Bank Ltd
• Norsk Tillitsmann

Contact

Address: 7 Down Street,

London,

W1J 7AJ

Telegraph: +44 (0) 207 993 9899

E-mail: enquiries@igasplc.com

Website: http://www.igasplc.com/

Resources

See: Fracking lobbying firms

• Melissa Jones and Andy Rowell, Access all areas: Westminster's (vast) fracking lobby exposed, 29 April 2015.
• Gas chief Andrew Austin: Fracking in East Midlands could provide 'big prize', BBC News, 7 April 2014, acc 16 April 2014