Following chancellor George Osborne’s announcement that shale has the potential to reduce Britain’s reliance on increasing expensive gas imports and create thousands of jobs, prime minister David Cameron has now declared that his government is “going all out for shale”.
With as much as 1,300tn cubic feet of shale gas lying under parts of the north and Midlands, just one-tenth of that would equal around 51 years’ gas supply for the UK. The news comes on the day that the French energy group Total becomes the first global oil company to invest in a shale gas exploration project in the UK and is a vote of long-term confidence in the UK shale industry.
The government will double from 50% to 100% the amount that councils in England can keep in business rates raised from shale gas sites. The offer could be worth up to £1.7m a year for a typical site. The prime minister will also try to reach out to concerned local communities by saying that the industry will consult on how to distribute funds of up to £5m-£10m for a typical site over its lifetime – a lump sum of £100,000 when a test well is fracked, plus 1% of revenues. Direct cash payments could be made to homeowners living near fracking sites.
Cameron believes that fracking is key part of the UK’s long-term economic plan as it will mean more jobs and opportunities for people and economic security for the country. Shale gas development could create tens of thousands of jobs, reduce imports, generate significant tax revenue and support a resurgence in UK manufacturing. Shale gas could be a new North Sea for the UK.
Despite legitimate environmental and safety concerns about fracking, the temptation to exploit the potential economic repercussions is too good to overlook so it looks like as far as the UK is concerned, it’s full-steam ahead.
