For weeks now, the top story across the globe has been the United Kingdom’s controversial exit from the European Union. The vote, dubbed BREXIT, has rippled across the entire globe as the economy and the geo-political makeup of the world have suddenly shifted. While the dust settles over one of the biggest political firestorms in recent memories, the landmark vote will have short and long term implications for everyone across the globe. The oil and gas industry isn’t immune to the chaos, as the BREXIT vote will absolutely have ramifications for the industry’s future.
What you may not know about the United Kingdom is that it’s been reported that the area contains large amounts of natural gas in its borders. Of course, until recently, the exploration of fracking as a means of extracting that gas has been very limited thanks to the UK’s membership in the European Union. Now, though, the countries of the United Kingdom are free to explore natural gas extraction — and fracking — without the governance of the EU.
According to some industry experts, the surge to get some fracking dollars is very likely. The current government in Britain, for one, which is home to several large natural gas deposits, has long sought leniency from Europe when exploring the possibilities of fracking. The aftermath of the “Leave” vote may just see those in power seeking to fast track the development of fracking in Britain.
For the most part, Scotland, Ireland, and Wales are against moving forward too quickly with any fracking proposals as they’re hesitant to establish any extraction sites before all of the information is in about the environmental impact. That said, a successful fracking in the United Kingdom could do its fair share to grease the wheels with the governments of those countries.
So what exactly does this mean for fracking in the local area? In the long term, the United Kingdom’s entrance into the oil and gas industry means one more competitor for those people looking to harvest and develop their own natural gas resources. While the initial backlash against the BREXIT may mean that the United Kingdom — and Britain specifically — will not become major competitors in the oil and gas industry, the island nations’ increased self-sufficiency may spell a little bit of trouble for those United States companies looking to tap into our nation’s vast natural gas reserves.