Bloomberg: Foreign Frackers Now Find Comfort in Water-Hungry Spain

A few years ago, fracking in Spain seemed as likely as bullfighting in Britain.

These days, energy companies from Texas, Canada and Ireland are going after exploration and drilling permits in hopes of capitalizing on geology that indicates Spain has a sizable chunk of the 883 trillion cubic feet of natural gas in shale estimated to sit under Europe.

What’s changed? A sluggish economy for one -- the energy industry estimates fracking could eventually create tens of thousands of jobs in a nation with an unemployment rate of 26 percent. Unlocking gas deposits might ease what consumers pay for the heating fuel. It’s about triple the U.S. price.

As important, the national government, with the economy in mind, took a pro-fracking stance even as regional and local authorities harden what’s long been widespread European environmental opposition to oil and gas development of any kind.

In December, two years after ousting the Socialists, the People’s Party-led Parliament changed a law to foster shale exploration with new environmental safeguards. Since then, the PP government sought Supreme Court approval to wrest control over land use from regional authorities who try to block fracking. And it’s kept intact a tax break for explorers established in the final years of the dictatorship in the 1970s.

“Spain is one of a handful of countries in Europe that is most hospitable to unconventional gas,” said third-generation oil man George Yates, a New Mexico native who worked in oil and gas exploration projects in Europe for about two decades. “And it’s under-explored territory” for shale rock.