Towards a Minerals Local Plan for Derbyshire and Derby

Towards a Strategy for Hydrocarbons


1.1    What are hydrocarbons and how are they used?

Hydrocarbons are the simplest of organic compounds containing only hydrogen and carbon. The majority of hydrocarbons found on earth naturally, occur in crude oil, where decomposed organic matter provides an abundance of these elements, which when bonded, can frequently occur in forms we can utilise in energy production. Other components are used as raw materials for the petro-chemical industry and in the manufacturing of drugs and plastics. Hydrocarbons are therefore an important mineral resource and the working of these resources within Derbyshire and Derby can contribute to the prosperity of the local area and the national economy. The working of these resources however, could potentially have adverse impacts on the environment and the communities close to the sites. It is important therefore that the Minerals Local Plan (MLP) recognises the respective benefits and disbenefits and sets out an approach to guide the assessment of future proposals for hydrocarbon developments, taking account of the appropriate balance between economic, social and environmental considerations.

For clarification, mineral resources are defined as natural concentrations of minerals, or bodies of rock that are, or may become, of potential economic interest due to their inherent properties. Mineral reserves are that part of a mineral resource, which has been fully evaluated and is deemed commercially viable to work and has a valid planning permission for extraction[1].

1.2    Where are they found in Derbyshire?

This section focuses on oil and gas (mostly methane) as the two main resources of relevance to Derbyshire and Derby. The geology of Derbyshire and Derby is such that there is the potential for further resources of oil and gas to be found in commercial quantities. Hydrocarbon sources have been classified into two mains categories: conventional and unconventional. Conventional hydrocarbons are oil and gas where the reservoir is sandstone and limestone. Unconventional hydrocarbons refers to oil and gas which comes from sources where shale or coal seams act as the reservoir. The Plan area therefore has the geological potential for both sources of hydrocarbons.

The eastern part of the County is on the western margin of the East Midlands oil and gas province[2] where earlier developments (early part of 20th Century) were centred around Heath, Calow and Hardstoft. It is possible that further resources may be found in this area. A substantial part of the County is underlain by coal. Methane gas is commonly found in coal measures and therefore the coalfield along the eastern county boundary is a potential source of further resources.

Gas can also be obtained from shale deposits and research by the British Geological Survey[3] has identified substantial resources within the Bowland-Hodder shale deposits. This area extends from Lancaster in the north-west across to Scarborough in the north-east. The broadly rectangular area extends as far south as Derby and Loughborough and therefore covers a large part of the County.

Detailed information on the scale of all these resources is not currently available but in view of their value and importance it is essential that the MLP sets the framework for the consideration of any future development proposals that may come forward during the Plan period.  

1.3    Potential extraction methods

The hydrocarbon resources in Derbyshire and Derby can be worked by a number of different methods. The working of the conventional oil and gas resources in the north-eastern part of the County referred to above was by drilling and pumping. Methane gas can be extracted from coal seams (an unconventional source) in a number of ways. It can be obtained from un-mined coal seams using a method known as Coalbed Methane (CBM) extraction. The gas can be extracted by drilling directly into the coal measures without affecting the physical properties of the remaining coal. Other gas resources can be obtained from abandoned mines where methane has accumulated over time and by underground coal gasification (drilling and subsequent controlled gasification of coal seams to recover gas). Currently there is one abandoned mine methane gas extraction operation in Derbyshire at the former Whitwell Colliery.

New methods of extraction are emerging and one technique that needs to be addressed in the Minerals Local Plan is Hydraulic Fracturing (known as fracking) which can be utilised to exploit the gas contained within the shale deposits lying much deeper than other methane resources. The British Geological Survey study referred to above estimates that the volume of the shale gas resource in the 11 counties in the study area (including Derbyshire and Derby) amounts to 40 trillion cubic metres, although it is not yet known how much of this resource could be exploited commercially.

Hydraulic fracturing is a technique that uses water, pumped at high pressure, into the rock to create narrow fractures to allow the gas to flow into the well bore to be captured. A proppant (usually sand or ceramic beads) is carried into the fractures and prevents them from closing. The material pumped under high pressure into the rock consists of approximately 98% water, 1% proppant and 1% of other additives such as lubricants or gels[4].  

There are normally three phases involved in hydrocarbon extraction from both conventional and unconventional sources: exploration, testing (appraisal) and production. The exploratory phase seeks to acquire geological data to establish whether hydrocarbons are present. The appraisal stage takes place when the existence of oil or gas has been confirmed, but where the operator needs further information about the extent of the deposit or its characteristics to establish whether it can be exploited economically. The production stage normally involves the drilling of a number of wells and the installation of ancillary equipment such as pipelines, processing facilities and storage tanks. Each phase raises separate issues which need to be addressed in the Minerals Local Plan.

1.4    Licencing of oil and gas operations

Anyone wanting to undertake hydrocarbon extraction operations (conventional or unconventional) requires an appropriate licence and other permits and approvals. The Petroleum Act 1998 vests all rights to the nation’s petroleum resources in the Crown, but the Government can grant licences that confer exclusive rights to ‘search and bore for and get’ petroleum[5]. As a result of the long history of legislation, several types of onshore licence existed. To simplify things, the DTI in 1996 commenced the issue of Petroleum Exploration and Development (PEDL) Licences at the 8th Licensing Round. These carry a three-term lifetime: a six-year Initial Term allows completion of an agreed Work Programme, which is a pre-condition of entry into the five-year Second Term. Successful completion and approval of a development plan is a pre-condition of entry to the Third Term for production, which is granted for a period of 20 years, although the Secretary of State has the discretion to extend this period if production is continuing.

PEDL approvals cover areas (blocks) which correspond to the 10 km by 10 km Ordnance Survey grid and many licences cover more than one block. The Department of Energy and Climate Change was responsible for the determination of licence applications but in April 2015 this was transferred to the Oil and Gas Authority, an executive agency of DECC.  On 18 August 2015 the Oil and Gas Authority announced the latest licence approvals granted under the 14th Onshore Oil and Gas Licensing Round. This covers 27 blocks which will be formally offered to the companies later in 2015. Another 132 blocks have been subjected to detailed assessment under the Conservation of Habitats and Species Regulations, 2010, the findings of which are currently out for consultation. Subject to the outcome of that consultation, OGA will announce offers for the second group of licence blocks later in the year. Further details of this announcement and the extent of areas covered by the new licences can be obtained via the following link: The areas covered by existing licences can be viewed on the plan below.


More information about hydrocarbons, the different methods of working hydrocarbons and the relevance to Derbyshire and Derby is available in the Derbyshire and Derby  Minerals Local Plan Supporting Papers; Conventional Oil and Gas, Gas from Coal and Shale Gas, August 2015.



[1] British Geological Survey Planning 4 Minerals Factsheet.

[2] Also known as the East Midlands Petroleum Province, it covers the petroliferous geological area across the north-eastern part of the East Midlands region.

[3] British Geological Survey and DECC report: The Carboniferous Bowland Shale Gas Study, Geology and Resource Estimation, 2013.

[4] About shale gas and hydraulic fracturing (fracking), 30 July 2013, Department of Energy and Climate Change.

[5] Petroleum – literally translates from Greek origins as ‘rock oil’. The name petroleum covers both naturally occurring unprocessed crude oil and petroleum based products that are made up from refined crude oil