It is 42 years since Algy Cluff successfully bid for his first North Sea oil licence. That was the fourth round of auctions held by the Government. Last week, he won 11 blocks in what was the 28th round.
These are far smaller than the jumbo reserves of the 1970s. The big North Sea oil reserves have all been emptied over the decades, leaving Britain facing an energy crisis that seems almost intractable – even with the probably overhyped potential of fracking.
Specialist explorers like the veteran Mr Cluff may have success in squeezing the last drops of crude out of the remaining fields, but it is small beer compared to the country’s requirements.
However, his Cluff Natural Resources has another potential ace up its sleeve: underground coal gasification.
The practice is in use in many parts of the world: you drill two holes into a coal seam. Down one, you pump oxygen, which interacts with the coal to create a smoke containing gas which shoots up the other hole into a pipeline. The difference with Mr Cluff’s plan is that, not only is his coal gasification underground. It is also underwater.
Cluff Natural Resources has eight licences to conduct tests for UGC around the coast of Britain. Yesterday, for the first time, an independent consultancy confirmed what the company has hoped for a long time: that there is a massive amount of coal deep under the seabed in its site in the Firth of Forth. To be precise, 335m tonnes of the stuff.
“In my view, the whole fracking thing is so fraught with planning and environmental problems, I think investors will just give up, eventually. But the beauty of what we’re doing is that we’re underwater, so there are no local residents,” he said.
He conceded that environmentalists will oppose his plans, which are yet to go through the local planning procedures, but he says the risks of pollution are less with gas than with oil. The coal seams are 300m to 1km under the seabed. The drill hole into which the oxygen will be pumped is on the shore of one side of the firth, while the gas will emanate from a hole on the other shore.
Whether his company is capable of successfully carrying out the gasification is, of course, for investors to work out, and this is untried technology, so the investment is in the “risky” category. The Firth of Forth reserve is, Mr Cluff says, big enough to power 150,000 homes.