The debate over shale fracking is warming up ahead of the government giving an expected go-ahead to the industry later this year.
Into the fray this morning came Lord Browne, former chief executive of BP, who – according to the Lords register of interests – is also a director of Cuadrilla, the only company currently fracking in Britain.
Partner & Managing Director, Riverstone LLC (private equity; energy & power)
Director, CODA Automotive Inc (automotive; battery)
Director, Cuadrilla Resources Holdings Ltd (oil and gas)
Director, Fairfield Energy Ltd (oil and gas)
(Cuadrilla is not without controversy: it was reported recently that the company breached the conditions of its licence at its sites in Lancashire.)
Lord Browne writes this morning that the UK has “promising onshore shale resources” which can provide a “critical role” in future energy supply.
In an FT editorial, he writes:
“The hydraulic fracturing process – or fracking – used to extract natural gas from shale is on the political agenda across Europe and has raised important environmental questions. But good practice and the UK’s tough safety regulations mean it can be performed safely and without endangering water supplies. If that can be achieved, the prize is substantial…”
Ed Davey, the energy secretary, has responded to the Lord Browne editorial in a letter to this newspaper in which he accuses the oil executive of “regrettably partial” analysis. The peer was wrong to accuse the coalition of the “unthinking abandonment” of fossil fuels, he said.
“Our Carbon Plan implies a very significant role for unabated gas throughout the 2020s, and as back-up or with carbon capture and storage through the 2030s and 2040s. We expect new gas capacity of up to 20GW to be built between now and 2030. Shale gas may well play a part in our energy mix too, but until we have more certainty about the potential scale and costs of shale gas production in the UK it is unwise to assume it will be some kind of silver bullet,” he responded.
It does seem as if Browne has skirted over the point that fracking is hugely controversial, as my colleague Pilita Clark explained back in the spring. The new technique has opened up the potential for vast untapped reserves of oil and gas and has already transformed the US energy market; but not without any cost.
“As fracking spread in the US, however, so did complaints. Some people with private water wells near fracked gas wells claimed their water had turned brown or contained methane, the main component of shale gas. A house near one fracked well exploded in Ohio in 2007, catapulting an elderly couple from their bed, according to a subsequent lawsuit…… Or as Nick Grealy, a UK shale gas lobbyist, says: “Ninety per cent of people hadn’t heard of fracking – and the 9 per cent who had, heard something wrong or bad or both.”
Here is another analysis, this time by our former energy editor Sylvia Pfeifer:
Just as nuclear power has its drawbacks, however, there are also uncertainties around shale. Chief of these is the potential environmental toll. The industry is dogged by