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06/10/16 14:34

Paul Wheelhouse statement on Underground Coal Gasification

Scottish Parliament

October 6, 2016

Presiding Officer, this Government is taking a clear and consistent approach to understanding the potential role for emerging technologies that could be used to further develop Scotland’s hydrocarbon resources.

That approach is one of caution while we gather and consider evidence on these new technologies.

Presiding Officer, this precautionary approach is the right approach, and it is one that has been widely supported by communities, industry and other interested parties.

I am aware there have been some recent examples of misunderstandings regarding the different technologies involved. I think it would be useful, therefore, to take a moment to reiterate our position on Unconventional Oil and Gas, before I turn to the separate issue of Underground Coal Gasification.

On 28 January 2015 this Government put in place a moratorium on Unconventional Oil and Gas, which means that no such activities can currently take place in Scotland. This moratorium covered hydraulic fracturing, or fracking as it is often referred to, and Coal Bed Methane.

This moratorium followed the publication of a comprehensive report by our Independent Expert Scientific Panel on Unconventional Oil and Gas.

I encourage members of this chamber to go back and look at this report to refresh their memories on its detail.

That report recognised that while there was a considerable body of international research and evidence on Unconventional Oil and Gas, there were gaps in key areas of evidence, including on climate change impacts, public health and decommissioning.

The moratorium on Unconventional Oil and Gas ensures that no fracking takes place while we explore these and other issues, like traffic and economic impacts, in detail before holding a full and comprehensive public consultation.

I can confirm today that the independent projects we commissioned to examine Unconventional Oil and Gas in more depth are nearing completion.

As was widely reported at the time, there were delays to commissioning the Transport research project. Despite acting swiftly to resolve those issues, that sequence of events has had an inevitable effect on the timetable for completing and publishing our research.

But I can assure the Chamber that the final project reports, which will form one of the world’s most wide-ranging investigations into unconventional oil and gas, will be published, in full, as soon as possible after recess.

Presiding Officer, as members are no doubt aware, there are strongly held views across Scotland on unconventional oil and gas, and real concerns amongst communities. We must recognise, listen to and respond to these concerns.

This is why the publication of the research reports will be followed by an extensive public consultation that will take place as planned in winter 2016/17.

This consultation will give people across Scotland the opportunity to consider, scrutinise, debate and set out their views on these technologies and the evidence. Given the seriousness of the issue, this is the right and proper way to proceed.

To make a decision on this issue in Scotland now would be to deny the people of Scotland a voice on this crucial issue.

I now want to turn to a different technology, one that is also very much a matter of interest to communities across Scotland, particularly around the Firth of Forth.

Underground Coal Gasification, or UCG, is a process for converting coal into gas, while underground, via combustion. The technology requires two wells to be drilled: an injection well through which gases are pumped to create high pressure combustion of the coal; and a production well through which the resultant ‘syngas’ can be brought to the surface.

Syngas is a mixture of gasses – methane, hydrogen, carbon monoxide, and carbon dioxide – which can be used as a fuel or as a feedstock for chemical products.

Unlike hydraulic fracturing or Coal Bed Methane, there are very few examples of this technology being used commercially anywhere in the world.

In recent years, there has however been interest in deploying this technology in Scotland, and the UK Government, through the Coal Authority, have issued coal mining licences for potential UCG sites in the Firth of Forth.

I want to stress that no planning or environmental consents for UCG have been issued in Scotland. Planning and environmental protection are fully devolved matters and both consents are necessary before a development could begin.

On 08 October 2015, the Scottish Government put in place a specific moratorium on UCG, separate to the Moratorium on Unconventional Oil and Gas, using the planning powers available to the Scottish Government, so that evidence on this technology could be gathered and considered.

To develop this evidence-base, we asked Professor Campbell Gemmell, Professor of Environment Research, Policy, Regulation and Governance at the University of Glasgow, to undertake an independent examination of UCG.

I wish to advise members that Professor Gemmell’s report has now been published. I would like to take this opportunity to thank Professor Gemmell for his work and for preparing a confident and comprehensive assessment of the technology.

The report, which has been informed by literature and through ‘in-depth’ interviews with academics, industry, NGO’s, community groups and regulators, notes that there are substantial coal resources in Scotland that could potentially be exploited by UCG technologies, with the greatest reserves of coal in central Scotland, Ayrshire, Clackmannanshire and East Fife.

The commercial value of these reserves, if utilised for UCG development, would, of course, depend upon gas market prices and competition, the quality and volume of gas, consistency of throughput, and other economic factors.

On potential impacts from UCG, Professor Gemmell’s report makes a number of observations which I believe raise serious concerns over the future of this industry in Scotland.

Firstly, there are very few comprehensive or peer-reviewed studies examining environmental and health impacts. Where impacts have been documented, these have been from trials rather than from full commercial scale activity.

Where the industry has operated, which is typically at a pilot or trial scale, there is emerging evidence of significant environmental impacts.

This includes soil contamination and exposures of workers to toxins resulting from major operational failures. A number of failures in Australia have resulted in prosecutions being brought.

Professor Gemmell also raises concerns that the current regulatory framework is insufficiently clear and would need to be improved to protect the environment, public health and workers’ health and safety.

Turning to the important issue of climate change, Professor Gemmell notes that UCG produces a variety of greenhouse gases, many without current viable market outlets. Professor Gemmell concludes that: “Climate change and decarbonisation targets would be very seriously impacted by unmitigated releases of UCG GHGs if operated at scale, making the achievement of current or stronger commitments much more difficult if not impossible.”

This would particularly be the case where gas production is not combined with a suitable removal, storage, offset or compensation method, for example Carbon Capture and Storage.

Professor Gemmell also concludes that a step change in the availability of robust data and science would need to take place before the technology could be reliably assessed. In Professor Gemmell’s words: “a very substantial transformation in available data” is needed.

In conclusion, Professor Gemmell states that, “it would be wise to consider an approach to UCG based upon a precautionary presumption”, and that it would appear logical “to progress toward a ban”.

Presiding Officer, having considered the report in detail, it is the Scottish Government’s view that UCG poses numerous and serious environmental risks and, on that basis, the Scottish Government cannot support this technology. Accordingly, UCG will have no place in Scotland’s energy mix at this time.

I acknowledge the interest that there has been in this technology in Scotland, and I am confident that any companies with an interest in UCG would aim to operate to the highest standards.

I also acknowledge the shortage of reliable information that Professor Gemmell was able to identify. I am grateful to him for the lengths he went to that ensured he reached out to a broad spectrum of interested parties and community groups both in Scotland and worldwide.

I will therefore ensure there is sufficient opportunity for views and evidence to be brought forward and considered as we develop and consult on our Energy Strategy for Scotland, which will set out an energy mix for the future that does not include Underground Coal Gasification.

Today I wrote to the Secretary of State for Business, Energy and Industrial Strategy setting out the Scottish Government’s concerns. I have asked him not to grant any further licences for UCG in Scotland and I have also asked him to revoke all existing licences.

I understand that the UK Government are also considering their position on UCG, and an announcement is due shortly. I expect the Conservative members may have thought to familiarise themselves with the position that is likely to emerge.

However, Presiding Officer, it is a matter of great regret that this Parliament does not have the necessary powers over the licensing regime for UCG.

The Scottish Government therefore intends to continue to use the planning powers available to us to ensure UCG applications do not receive planning or environmental permission.

I cannot predict what kind of clean energy technologies may be available in the decades to come, but what is certain is that this coal resource will still be there.

Presiding Officer, the position I have announced today on UCG is a clear validation of the evidence-based approach this government is taking.

We live in a world where the pace and scale of technological innovation is increasing. This is a testament to our collective ingenuity, and must be supported and embraced wherever possible.

However, when necessary, presiding officer, we must be ready to pause, so that we can consider and interrogate the evidence, and be ready to act accordingly, which I believe we have done today.