Tamboran Resources: The Luck of the Irish

Four leaf clovers, anyone? 

Turns out Ireland is pretty lucky when it comes to shale gas. The “Emerald Isle” possesses several shale basins containing 10 to 20 or more Trillion cubic feet (Tcf) of gas in place, in Leitrim, Cavan, Sligo, Donegal, Monaghan, Roscommon and Fermanagh.

But unconventional gas production is only likely to happen if the public acceptance issues surrounding unconventional gas can be overcome in Ireland.

One of the country’s suitors who hopes to tap into that gas is Canada’s Tamboran Resources, which, in addition to license concessions in Ireland, has E&P sites in Australia and Botswana.

Tamboran’s CEO Richard Moorman – who is very attuned to assuaging Irish fears over hydraulic fracturing - said that thanks to EU rules, he believed shale gas E&P could be performed in Europe as safely as possible, especially in Ireland.

He welcomed the Irish government’s decision in October to investigate the hydraulic fracturing involved in shale gas E&P.

As for how Tamboran plans to pursue unconventional gas in Europe, he said, “The fact is that we have to go through 12 months with the Ireland’s Environmental Protection Agency, so there’s time. The right answer for Europe is to take your time.”

“Every single well has to succeed,” he said of Tamboran’s efforts to protect Ireland’s environment. “We can’t tolerate a single failure. We’re there to follow their rules and we want to work with regulators and have people realize that regulators are looking out for people.”

He admitted that for the average man on the street, hearing about drilling for gas was like hearing about how sausage was made, that while it might initially be scary, it was a matter of getting acquainted with it.

Meanwhile, Tamboran Resources is getting acquainted with the Irish shales via previous data acquisitions done in the last 50 years. Moorman explained that 13 wells had been drilled to look for oil and gas, but there were some technical limitations.

“We must adopt a modern mindset for the old data,” he explained, adding that Tamboran would be studying the previously conducted seismic data.

“Now we have more powerful computers and get a glimpse of what’s down there. Back then, computers got more noise coming back that they couldn’t interpret, but today there’s useful information in there.”

He reported: “We are seeking permission to conduct 3D seismic for shooting horizontal wells. That should be done by the middle of next year.

“It’s the world’s largest core of Bundoran shale, which is 500 meters thick.”

He said the coring would occur at 700-1200 meters to “show people how good it is.” 

“By doing this, we knock all the risk out,” he added.

According to Mr. Moorman, Tamboran intended to receive planning permission in 2013 and engage in extensive consultations. “By the second half of the year, we want to start exploration,” he said.

Moorman said that would comprise drilling 3-5 wells in each country and 6-10 of them would enable Tamboran to determine whether production was worth pursuing in Ireland.

If that appraisal got a green light, he reported the company would then drill anywhere from one to 2,500 wells. 

He added that there was a big plus in Ireland considering that potential shale gas wells would be only about 50 kilometers’ distance from a pipeline grid, providing shale gas access to the market. “Ireland imports about 90% of all its energy, so they have a fairly good grid in the south an east areas of the country.”

“In Australia, our nearest pipeline is 300 kilometers away, so you have to have a lot of confidence that there’s going to be production.”

“In Ireland, we’re literally at the end of the grid,” he said.

Tamboran, Moorman said, would be sure to monitor the air and water quality near its operations.

“We have the capability and there’s an obvious need,” he said of the monitoring. “If people are programmed to be careful first, that goes along with our mindset.”

Drilling in Ireland would go on for 15 years, stated Moorman, with operations ramping up each year. He said the wells should produce for 35 years and the entire project was to encompass 50 years.

“At its peak it will have around 700 employees. There could be 2-10 times as many associated jobs created, so it’s a tremendous opportunity.”

“We’re not talking a small amount of business,” he said of the opportunities that could emerge with the shale exploration and production. “It could create hundreds of direct jobs and thousands of indirect jobs. We’re getting great feedback on that.”

He noted Ireland’s high levels of unemployment and the quick way in which it had responded to the prospects for shale gas production.

“I’ve received over 100 resumes, and 50 business enquiries,” he reported.

In terms of offering locals a stake in the shale development, Tamboran intends to invest in them. Mr. Moorman said the company had started a training program in the west of Ireland to do just that.

“We are selecting about 10 people of all ages and of any background to participate in one year of training to provide them with know-how and demonstrate that we are serious,” Mr. Moorman explained. He added that half of the training would be international while the other half would take place in Ireland.

“This is to create project leaders for our local operations. We’d like to get a good crop of people started and get them up to speed.”

He said the next phase of the training program would take on 20-30 people.

Ireland is not likely to escape public opposition to the shale gas industry, in particular hydraulic fracturing.

“There’s a fairly opposed group that has been mislead by Gasland,” explains Moorman, “which is already dated in terms of, for example, the chemical disclosure of hydraulic fracturing fluids.”

“One out of 1,000 wells may have a problem,” he admitted. “People are already prone to disliking big business, but in western Ireland they don’t like the government on a good day.”

Mr. Moorman made an impressive pledge regarding the company’s fracking fluid, which will not contain chemicals in Ireland.

“We’ve cut all the chemicals out of our hydraulic fracturing because it’s shallow. We’re new in Ireland and can make the effort,” he said.

He explained that there was more apprehension in the Republic of Ireland than in Northern Ireland, because the former did not have the background with oil and gas exploration in the North Sea.

Despite that, he described the overall atmosphere in Ireland surrounding the development of the country’s shales as positive.

“It is very positive. There’s a group out west that are hardcore anti development folks. They wish the royalty was higher and want more money out of it, like Norway. But I think Norway has earned it.”

As a Canadian, Mr. Moorman, who has worked in the oil and gas industry in the US, said he understood the leeriness from Europeans when shale drillers come over with a Texas accent, which may leave the impression that the “brute force” method of shale gas production is being exported. 

“And today it would be illegal to do things in the industry the way they were done 50 years ago – we now look at the world differently, we look after our people. We have to perform the way people want us to,” he said.

“I’ve been a petroleum engineer 20 years full time,” he said of his career. “I’ve been in unconventional gas for most of my career – tighter and tighter rock.

“Seven years ago I fell head first into the shale gas industry and in the last five I’ve held positions in the managerial or financial advisory aspects of the business.

“It’s a subject I’ve truly fallen in love with – it’s an evolution,” he continued.

“Tighter rock was forced upon us because we ran out of all the easy stuff,” he explained of the industry pursuing unconventional gas following the depletion of conventionals. 

“It’s a whole new set of sciences and Europe is at the front end,” he said.

Richard Moorman will be speaking at the EMEA Unconventional Gas Exploration and Production Forum in Istanbul on 6 – 8 February 2012. His presentation is entitled: “Partnerships for Prosperity - Building Consensus and Stakeholder Collaboration in the Burgeoning EMEA Unconventional E&P Industry”.

Tamboran Resources have also been confirmed as a sponsor of the event.