UK Backs Shale Gas Explorers

The UK government announced May 17 new measures to support shale gas development. They include streamlining and improving the regulation process for shale applications, including the setting up of a ‘Shale Environmental Regulator’ and ‘Planning Brokerage Service’ to focus exclusively on the planning process that would have no role in the determination of planning applications.

Also included are a new £1.6mn shale support fund over the next two years to boost capacity in local authority planning departments; and two consultations: one on the principle of whether early stages of shale exploration should be treated as permitted development, the other on criteria required to trigger the inclusion of shale production projects into Nationally Significant Infrastructure Projects.

The full statement by UK business and energy secretary Greg Clark is available here; it was issued jointly with the communities ministry.

Energy/clean growth minister Claire Perry, who reports to Clark, said: “British shale gas has the potential to help lower bills and increase the security of the UK’s energy supply while creating high quality jobs in a cutting-edge sector.” The measures would deliver on the government’s 2017 manifesto promise to support shale, she added.

Currently only England permits shale gas exploration and future production; other parts of the UK (Scotland, Wales, Northern Ireland) have either legal or de-facto bans on fracking and/or unconventional onshore activity. Shale gas explorer Ineos is challenging the Scottish ban but is opposed in court by Friends of the Earth Scotland. Apart from four operators - Cuadrilla, Ineos, IGas, ThirdEnergy -  little activity is underway in England, and recent valuations of shale acreage have been a fraction of deals done back in 2012-14 when gas marketers such as Centrica, Engie and Total invested; Engie has since divested.

UK shale explorer Cuadrilla Resources’ CEO Francis Egan said: “We welcome the measures the government has introduced on making the planning process ‘faster and fairer’ and providing additional resources to help local authorities. Our planning permission to drill and test just four shale gas exploratory wells in Lancashire was granted after a lengthy and costly three-year process. These timelines must improve if the country is to benefit from its own much needed indigenous source of gas." (The banner photo of a shale gas rig is courtesy of Cuadrilla)

Ken Cronin, head of onshore operators group UKOOG, agreed saying that gas imports were costing the UK over £13mn/day and that in order to bolster UK gas production: “Britain needs a policy framework and a planning and permitting system that allows industries like ours to be able to get decisions within timescales that work for all concerned including local communities we work in.”

But Rebecca Newsome of environmental activist group Greenpeace UK condemned the changes: “After seven years of fracking doing less than nothing to help our economy, the government’s still going all out for shale, and still trampling over democracy to prop up this collapsing industry” - a reference to a planning rejection by Lancashire county council against Cuadrilla in June 2015 being subsequently overturned by the government. Courts later upheld the government's decisions.