What Now for UK Shale Gas?
Plans to frack for shale gas in the UK are currently on hold in spite of the pro-fracking Conservative Party securing a majority in the country's Parliament in May's General Election. The main company pioneering efforts to develop a shale gas industry in the UK, Cuadrilla Resources, has faced one obstacle after another in its attempt to explore for shale gas at two locations in Lancashire, England.
The latest stumbling block is Lancashire County Council's refusal to allow Cuadrilla to explore for some of the 2,281 trillion cubic feet of shale gas that the British Geological Survey estimates could be contained within the Bowland Basin in northwest England.
In late June the council's Development Control Committee rejected Cuadrilla's applications to drill at the company's Preston New Road and Roseacre Wood exploration sites due to too much noise and traffic. Cuadrilla itself has pointed out that the council's planning officer had in fact recommended approval of the Preston New Road planning application while the firm believes it can reroute traffic to the Roseacre Wood site in order to get around the council's concerns about more vehicles passing through the area.
Recently, Rigzone caught up with Ken Cronin – chief executive of the UK Onshore Operators Group (UKOOG) – to find out how he thinks things will play out now.
First of all, Cronin is dismissive of the idea that the resistance to fracking by the environmental lobby, certain sections of the public and, now, Lancashire County councillors means that the industry is dead before it has even really begun in the UK – as some commentators in the UK media have been suggesting recently.
"The reality is that 12 years ago my opposite number in the wind industry was shouting from the rooftops that planning was the problem … and [the wind industry] would never get planning for onshore windfarms through, etc. Ten years before that we had a nuclear power station that went through a seven-year planning cycle. So adverse planning decisions are not just something that's unique to this [the shale gas] industry," Cronin told Rigzone.
"It's an issue that onshore energy production has. You have national policies and local decision-making, and those two are always going to rub."
In fact, Cronin thinks that those interested in seeing the development of a shale gas industry in the UK should look at the positives from Lancashire County Council's recent decisions.
"We had a planning officer's recommendation after a very detailed and elongated process in which basically he said: 'All of the above, including the local issues, I've looked at and I give a recommendation to approve.' That was backed up by legal advice, it's backed up by advice from third-party consultants for noise and transport, and the reality is that the councillors rejected it on the basis of very local decisions: noise and landscape.
"So, I think there are a lot of positives to look at. Is one adverse planning decision going to stop the industry? No. There are a number of applications in the pipeline across the country and we shall see those coming through towards the end of the year. When will we see the first frack? We are at the vagaries of planning decisions but I'm hoping to see activity next year."
Planning Decisions Need to be Made More Quickly
As well as being optimistic, Cronin is also pushing for a faster approach when it comes to planning permissions. The lengthy time taken by authorities to allow fracking at a particular site is similar to the long, drawn out planning decisions faced by the wind industry more than a decade ago.
"The Cuadrilla decision from applications being submitted took 15 months for a 16-week process. And the reality is that you cannot plan on that basis. You cannot invest on that basis. We have to have a system that is more streamlined, both for the industry and for the communities involved," Cronin said.
It seems that because fracking has become such a politicized issue in the UK, with several protests springing up around the country against onshore drilling activity, local authorities are spending longer over granting permission to drill.
"If you compare 2013 with 2014 average planning times have gone from three-to-four months to 12 months, so we've seen a big increase," Cronin said.
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