Law changed to help frackers as study finds major shale oil reserves

Individuals will not be able to use trespassing law to block fracking plans, under proposals announced on Friday as a British Geological Survey report revealed major reserves of shale oil under southern England.

In a move that will also benefit geothermal energy projects, government plans to limit the rights of individual property owners to appeal and delay drilling more than 300 metres beneath their homes. To sweeten the deal, there will be a “voluntary community payment” of £20,000 for each lateral well, on top of £100,000 already promised by the industry for each test well.

A BGS study of the Weald Basin estimated there are 4.4 billions of barrels of shale oil under Kent, Sussex, Surrey and Hampshire. “There is unlikely to be any shale gas potential,” the researchers found. They stressed that it was too early to say how much oil would be technically or economically recoverable.

Energy minister Michael Fallon said: “Britain needs more home-grown energy.  Shale development will bring jobs and business opportunities.

“We are keen for shale and geothermal exploration to go ahead while protecting residents through the robust regulation that is in place.

“These proposals allow shale and geothermal development while offering a fair deal for communities in return for underground access at depths so deep they will have no negative impact on landowners.”

The Department of Energy and Climate Change noted that several other industries access ground under people’s homes to lay cables and pipes, much closer to the surface than any proposed fracking. The proposals would simplify “costly, time-consuming and disproportionate” rules for new methods of underground drilling, it said in a statement.

Ken Cronin, chief executive of industry body UKOOG, agreed. He said: “It serves no one if access to much needed natural resources that lie deep below the surface of the UK is denied by a legal system that desperately needs updating.”

Fracking involves drilling horizontally for more than a mile outwards from a mile-deep shaft and pumping down water and chemicals to release oil and gas for extraction. That means there could be activity going on under several properties at once and under the old law, a single objection could cause significant delays.

The existing law was designed for vertical drilling and “needs to catch up” with technology developments, according to Catherine Howard, senior associate at Herbert Smith Freehills. “The change in law would remove one of the main obstacles to investor confidence. At present the only way operators can use underground land for fracking is to obtain the consent of all land owners above, or apply to court for the grant of compulsory rights under the protracted Mines (Working Facilities and Support) Act 1966 procedure. It is unlikely that any shale gas operator would attempt to go through this process, as the cost and time delay would be prohibitive.”

She added: “The planning process is the proper forum for local people to raise any concerns and objections they may have to hydraulic fracturing proposals, and not the courts.”

Test drilling has met fierce opposition, with activists raising local and global environmental concerns from groundwater contamination risks to the climate change impact of extracting a new source of fossil fuel. However, government strongly backs the emerging industry, which it hopes will boost security of energy supply and potentially cut energy bills.

The proposed system means developers can negotiate at community level rather than with each landowner individually. Shale exploration companies will be expected to pay around £20,000 to the affected community for each lateral well. On a typical site with 10 vertical wells, each splitting off into four lateral wells, that could amount to between £200,000 and £800,000.

It could also make it easier for geothermal energy developers to agree compensation with communities for drilling under their land, according to the Renewable Energy Association.

Geothermal power projects involve some fracking to create heat reservoirs, but normally in remote areas. Geothermal heat projects do not require fracking but can involve drilling two or three wells in residential areas.