Reuters: Fitch: Fracking Moves Would Help EU Cut Reliance on Russian Gas

Germany's reported plan to lift a ban on fracking highlights one of several ways that European countries could reduce their reliance on Russian gas, Fitch Ratings says. The UK on Wednesday also outlined a plan to allow companies to drill under private property without the owner's permission.

These moves indicate a growing appetite for the long-term exploitation of Europe's shale gas reserves. The crisis in Ukraine has added to pressure to diversify gas sources. But there are other long-standing factors, including high domestic energy prices in Germany, which are hurting the competitiveness of some industries and which are likely to have influenced the decision.

Out of the major European oil and gas companies, we believe Total could have a head start over rivals if European shale gas production ramps up, because of the experience it has gained from investment in UK shale. The group became the first Western oil major to invest in UK shale after agreeing to take a 40% stake in two licenses earlier this year.

Total would also be well positioned if France followed Germany and decided to ease restrictions on shale gas production, as its home market is thought to have some of the largest shale gas reserves in Europe. If European countries want to cut reliance on Russian gas, other potential routes include greater use of LNG.
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