Thursday, 20 December 2012

Government go ahead to shale gas extraction

I have expressed on several occasions in the past that I have certain reservations about the merits of fracking for various environmental reasons. I am not blindly opposed to fracking, however it has always been a balancing act between whether we believe the benefits of cheaper gas will a) materialise and b) outweigh the physical downsides of the process.

I fully endorse the words of Caroline Flint, Labour’s Shadow Energy Secretary, who said recently:

“Labour has always said that fracking should only go ahead if it is shown to be safe and environmentally sound. If the Government believes that this is the case then we will look carefully at their proposals against the six clear conditions we have set. But the idea that this form of gas extraction can have the same impact here in the UK as it has had on gas prices in the United States is considered wishful thinking by most experts.”


I wrote an article in The House Magazine recently in which I expressed scepticism about the fact that shale gas will do for the UK what is has done for the US. It has undoubtedly been a great success in the US in terms lowering gas prices, but the UK does not have the same infrastructure as the US or the same developed extraction and distribution industry.

The Institute for Economic Affairs have estimated that extraction costs will be up to 50% higher in the UK than the US; Deutsche Bank stated that those who expect it to be replicated in the UK will be “disappointed”; even Cuadrilla, the company which will be drilling for the gas have stated that “no one on either side has said it would transform Britain”.

However, the Government have lifted the prohibition on test-fracking in the UK, and this is the reality now. I will therefore be paying close attention to how the test-fracking situation develops in Lancashire.

Editor’s notes:

1. In March 2012 Tom Greatrex MP, Labour’s Shadow Energy Minister, set out Labour’s six conditions for the restoration of Shale Gas “fracking”
i. Mandated disclosure of chemicals used in fracking and assessment by regulator of their potential environmental impact and only non-hazardous chemicals to be used in fracking mix.
ii. Must be a full assessment of the well integrity to ensure casing and borehole not susceptible to leaking; this must meet current industry standards for other types of drilling.
iii. Micro-seismic monitoring of the area prior to any drilling to determine what the potential impact would be on local area.
iv. Full assessment of impact of water use on local community, including assessment of how much of the water will be reused or recycled.
v. Assessment of groundwater methane levels prior to fracking.
vi. Should be at least a full year’s monitoring of all of the above before any drilling can proceed.