FRACKING REPORT: ‘There are going to be great benefits to communities’

Cuadrilla Resources' fracking plant in Lancashire. Below: Energy minister Michael Fallon.
Cuadrilla Resources' fracking plant in Lancashire. Below: Energy minister Michael Fallon.
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Energy minister Michael Fallon today said Fylde residents could only benefit from shale gas drilling – with community handouts worth at least £100,000 per ‘fracked’ site , a potential jobs bonanza and tough regulation to ensure safety and protection of the environment.

Mr Fallon, said strict monitoring would be in place during the process and that communities would “be hard pressed to notice” production rigs so they would not be visually intrusive.

Energy minister Michael Fallon

Energy minister Michael Fallon

He said: “It’s not going to be a huge industry like a steel plant on their doorstep.

“There will be something like 20 to 40 wells across Britain in the next three years not a forest of rigs sprouting up on the hillsides. Some of these facilities you would be hard pressed to see, small, tucked away down a village lane.

“One of them is up a Forestry Commission track and therefore unobtrusive.”

His comments came as a British Geographical Survey report produced for the Government showed that the natural gas resources trapped in the Bowland shale rocks beneath the Fylde were almost double the previous estimates at 1,300 trillion cubic feet.

Even if only 10 per cent of that could be economically extracted, as has been suggested, that could produce enough gas to satisfy the country’s needs for 40 years.

He also spoke to The Gazette as the Government announced measures to enable shale gas drilling as part of its infrastructure plans.

They include new planning guidelines to make the process of approving new drilling sites more streamlined, and a consultation on tax incentives to encourage exploration.

Mr Fallon said: “Shale gas has huge potential and the resource is much bigger than previously thought. It would be irresponsible not to allow the industry to explore and have a look at what might be possible. It could provide a big boost for the Treasury and for local communities and could play an important part in our energy mix.

“North sea oil has historically funded public services for years. We can’t rely on international oil prices and gas supplies from aborad. We have to generate more energy here in Britain. Shale gas is just one part together with North Sea oil and renewables, but it is a big part.

“The next step for industry is to establish how much gas is technically and commercially recoverable.

“With the package announced today on planning, environmental regulations, and community benefits, it is clear that we want to encourage a shale industry that is safe and that doesn’t damage the environment.”

On the potential benefits for the Fylde economy Mr Fallon said gas companies such as Cuadrilla Resources which operates on the Fylde and has identified a “vast reserve” in the area, would be providing £100,000 for each well that carries out fracking during the exploration phase before extraction begins.

He added: “The industry has significantly increased its offer and there are going to be great benefits for local communities as well as the country.”

Mr Fallon said the detail would have to be decided between the industry and community representatives but for every shale gas exploration rig which caries out fracking £100,000 will go to the local community.

“That could be for community facilities such as local playgrounds or sports halls, or a county wide charity or to local households directly. They could choose to have a money of their energy bills. It would be for the local community to decide.” He added that in the production phase a further one per cent of the revenue from each well would go back to the communities worth millions of pounds.

He added that a package of reforms unveiled by the Government would clarify and simplify the process for the industry but not make it easier for company to exploit the resource without regard for safety or the environment.

He said: “We have put in place, since the seismic activity near Blackpool, a much more robust regulatory framework with licences, planning permission, health and safety permits, environment agency permits regulations for water waste disposal and finally they need consent from me.

“Then there is going to be proper monitoring to show that they have met the requirements and monitoring on any fracking they carry out.”

Mr Fallon said a traffic light system to monitor earth tremors would be in place and fracking activity would be halted if seismic activity rose above 0.5.

Fracking was temporarily suspended in the UK in 2010 after activity by Cuadrilla caused tremors near Blackpool which were 2.3 and 1,4 in magnitude. The ban was lifted in December.

Mr Fallon said the Government’s announcements on regulation reforms would speed things up but not at the expense of safety or the environment.

He said: “They make things clearer but nor easier for the gas industry.”

Fracking involves engineers drilling a hole deep into rock where the gas is trapped, and then inject a mixture of sand, water and chemicals at high pressure.

Cuadrilla’s exploration phase began in 2010 at Preese Hall, Weeton. The company has sites at Becconsall, Westby and Singleton.

‘For the country shale gas can be a great thing. For Lancashire and Fylde it will bring hell’

Anti-fracking protest groups have lined up to condemn the announcements from the Government, saying the cash handouts were no compensation for the potential damage the shale gas industry could do to the Fylde.

Mike Hill, engineer and member of Defend Lytham said the offer of cash to local communities was not worth it when compared to the potential damage to the environment and the tourism industry.

He said: “I actually think there would be a net loss in jobs. This is going to be one of the most intensive drilling operations in the world. Potentially there could be 3,400 wells in the area between Kirkham, Blackpool Lytham and Warton. Around 10 per cent of these could be flaring off gas. This could be 24/7.

“I think that would affect the tourism in the area for example at camp sites. It would put people off.”

He said most of the jobs in the drill pads would go to engineers brought in from outside the area who lived on site and did not frequent the local towns, He predicted only about 50 local jobs would be created.

And he refuted Michael Fallon’s claim that the industry would be regulated. He said: “The Environment Agency does not have enough staff to monitor this number of wells.

“I have been told that there will be no new regulation to cover things such as flaring and flow-back water which remains underground, so I’m afraid in Michael Fallon has been badly advised.

“I think for the country shale gas could be a great thing bringing in revenue for the Government and a bit of energy security, but for Lancashire and the Fylde it will bring hell.”

Tina Rothery, pictured, from Residents’ Action on Fylde Fracking said: “The offer of £100,000 of benefits to local communities, per frack is quite astounding – do they really believe this will somehow negate our deep concerns over the safety, health and welfare of the communities here on the Fylde?

“The claim today there is 1,300 trillion cubic feet of shale is very misleading as Cuadrilla and other shale gas exploiters have made clear that less than 10 percent of the ‘shale potential’ is actually recoverable. The jobs claim too is misleading. We may have some short-term job gains from the shale gas industry but what about the job losses in tourism and agriculture that will result? More than 100 well-pads, each hosting around 10 wells or more and each with ‘flaring’ of methane, are not only a risk to our health, water and air but also to the way of life here. The industrialisation of the Fylde will not sit well with tourism and agriculture.”

Gayzer Tarjanyi from Frack Free Fylde said the offer of £100,000 to local communities was a bribe .

He said: “They are offering £100,000 for every well in an area. That’s because it is a risk.

“What is that risk? We think it is a health impact on the areas in which it takes place.

“The EU has said there is a risk to anyone living in the area.

“We want to know why are they relaxing regulation when people have fought for years to get regulation on environmental issues? They are simply forcing this through.

“David Cameron has introduced planning restrictions on wind farms but are they going to do the same on fracking sites?

“As to the amount of gas they say is under the ground. Well in the US they originally claimed there was enough to last 100 years but since they have revised that down by 65 per cent.So you can take this announcement with a pinch of salt.”

‘The potential is beyond £10m’

The chief executive of Cuadrilla Resources today hailed the announcements as highly encouraging – and said they would place Lancashire at the centre of shale gas technology for years to come.

Speaking about the new estimates of gas resources under the North West, Francis Egan, right, said: “We are not highly surprised, but are very encouraged.

“The conservative estimate of the amount we can actually extract is 10 per cent, in the US they have 20 to 30 percent recoverable, so 10 per cent is 130 tcf which is equivalent to over 40 years of the UK’s total gas supply.

“The benefit proposals are that when we get into gas production, that one per cent of revenue is shared between the local communities.

If you take 10 wells as an example, that 10 per cent equates to between £5m and £10m over the life of the well production site. The £100,000 payment is for the exploration phase.”

He said depending on environmental impact studies and planning permission more exploration wells would be drilled and the first of that £100,000 could be distributed early next year.

Asked if the £100,000 payments were a compensation for any risk he said: “Is there a risk? Absolutely not. This money is so that the local community gets a share in the benefits of gas extraction in the benefit so the gas they own.”