Shell turns back on UK shale

Royal Dutch Shell has turned its back on the UK shale gas industry saying it does not want to be the company that finds out whether shale will succeed in Britain or not.

Simon Henry, Shell’s chief financial officer, told The Telegraph that the company has already allocated £3.8 billion to shale globally and they were not going to expand that budget.

He added: “The UK has to compete directly with them and right now nobody even knows whether the gas will flow.”

The government is hopeful that “generous” tax breaks, coupled with the creation of the Office for Unconventional Gas and Oil (OUGO), would attract shale developers.

However, so far only a few smaller companies, such as Cuadrilla, are investing in UK shale.

It had been hoped that Shell would get involved, following positive comments from Henry last year, but this was knocked back.

Henry said: “We are not going to just throw more strategic capital allocation into the business because the UK, or any other country for that matter, feels it’s a good thing.”

Henry did keep the door open to Shell coming to the UK, adding: “If and when the UK reaches the same level of potential attractiveness, we’ll give it a thought.”