Sector News

Britain needs new regulator for shale gas industry to take off: task force

March 25, 2015
(Reuters) – Britain needs a new regulator for onshore underground energy and shale gas companies must engage with local communities more effectively before a UK shale gas industry can be developed, a task force examining the sector said on Wednesday.
Several companies plan to explore for shale gas in Britain using hydraulic fracturing, known as fracking, which injects water, sand and chemicals into rocks to release hydrocarbons.
However, there is considerable local opposition to the process due to concerns about noise and environmental damage.
The Task Force on Shale Gas was set up last year to examine the risks and benefits of shale gas extraction and says it is independent of its funders — Cuadrilla Resources, Centrica, Total, Weir Group, Dow Chemical and GDF Suez E&P UK.
It published an interim report on Wednesday looking at local engagement, planning and regulation issues. There will be three more reports this year covering environment, climate change and economics before final conclusions next year.
The report recommended that a new regulator for onshore underground energy, which includes shale oil and gas, should be created to take over responsibilities currently split between various agencies and government departments.
“We believe the creation of a new, bespoke regulator for onshore underground energy would command more public confidence for ensuring proper monitoring and regulation of any proposed shale gas industry,” said Chris Smith, chair of the Task Force on Shale Gas and former chair of the Environment Agency.
The regulator should carry out independent monitoring of shale gas sites and members of the community should be able to participate to verify the process.
It could take two to three years for a regulator to be established. In the meantime, the existing regulatory system should be able to cope with the number of planning applications in the pipeline, Smith said.
“We are very unlikely to see huge expansion very rapidly,” he told journalists ahead of the report’s launch.
Public engagement is the biggest obstacles to shale gas development in Britain and the most frequent concern in local communities is about noise and traffic impacts from fracking.
“Some of the early examples of community engagement were less than perfect. (Operators) are trying to do better by giving more information to local communities but we believe they could go further,” Smith said.
“Provided that operators approach with the right degree of care, community engagement and all proper regulatory provisions are in place, they stand a better chance of getting things off the ground than they do at the moment,” he said.
(Reporting by Nina Chestney; Editing by Janet Lawrence)

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