(The author is a Reuters market analyst. The views expressed
are his own.)
By Gerard Wynn
LONDON Dec 18 A proposed law could ease British
planning regulations for shale gas developers after the country
gave the green light for a resumption of exploration last week,
but local support will be vital for even limited production.
A high population density in much of the European Union and
Britain is partly responsible for planning regulations which
include detailed public consultation which in the present form
will test the development of a shale gas industry in its
The complexity of the planning process in Britain is
illustrated by the efforts taken by the main present explorer,
Cuadrilla, to drill six exploratory wells in the north west of
The private-equity-backed company has submitted at least 18
separate planning applications, local government data show, and
has dealt with 31 British national planning policies on issues
including the environment, oil and gas production and water
The company has not produced any gas by fracking to date.
A proposed Growth and Infrastructure Bill in Britain offers
the prospect of extending to extractive industries a fast-track
planning procedure introduced four years ago for projects deemed
of national significance.
Without such assistance it is difficult to see how shale gas
development can take off in densely populated Britain.
And even with fast-tracked planning approvals, production is
likely to be limited by the political clout of lobbies for the
protection of the countryside and wildlife.
Britain's existing Planning Act of 2008 already allows
streamlined decisions on major energy, waste and transport
development classed as Nationally Significant Infrastructure
Oil and gas exploration and drilling are not presently
explicitly supported under that programme.
Eligible projects in the energy sector are electricity
generation including renewable, nuclear and fossil fuel power;
electric grids; and gas infrastructure projects including
pipelines, storage and import facilities.
These are defined in "national policy statements" which
detail relevant planning guidance, supporting projects above a
certain size such as onshore power plants over 50 megawatts.
Planning decisions are streamlined through a time-limited
process (one year) run by a panel called the Planning
Inspectorate, rather than involving multiple local planning
The Secretary of State makes the final decision based on the
panel report. Developers are still required to carry out
extensive public consultation on their proposals.
Approvals for projects are based on the published national
policy statements, making the process quicker and outcome more
GROWTH AND INFRASTRUCTURE
A draft growth and infrastructure bill offers the prospect
of extending that fast-track process to other industries, and is
in a legislative pipeline approaching parliamentary approval.
"This (bill) broadens the 2008 Planning Act's scope so that
a much wider range of infrastructure development can be brought
within the nationally significant infrastructure planning
regime," states an impact assessment report accompanying the
"This will allow applicants for large scale business and
commercial development to apply to the Secretary of State for
the option of using the streamlined approach set out in the
Extractive industries were one possible beneficiary.
"Formal consultation will be carried out on the types of
development which the Secretary of State proposes to prescribe
"Forms of development which could form part of that
consultation include: Warehousing and storage; Manufacturing and
processing proposals; Office development, including research and
development facilities; Extractive industries (mining and
quarrying); Major tourism proposals and leisure venues; Mixed
-use developments (where this includes two or more of the above
uses but does not include housing)."
Use of the fast-track process would be the choice of the
developer and a decision of a government minister.
Meanwhile, the government is pressing for more rewards for
local communities which may boost support for development.
A particular example is the case of long-term disposal of
nuclear waste: the former government decided it would be
difficult to thrust such a development on a local community
simply on the basis of geological suitability.
It proposed in 2007 a "voluntarism and partnership" approach
which stressed the economic and social benefit that would accrue
to the local community, in its paper published in 2008,
"Managing Radioactive Waste Safely".
The recent 2011 Localism Act reinforced that principle of
rewarding communities more widely, broadening the uses for a
levy on developers beyond simply infrastructure to wider
Cuadrilla's shale gas operation is at present focused in an
economically deprived area of north west England.
Unsurprisingly, the company is already keen to appeal to
both the national significance of shale gas development and
For example, it says it not only expects explicit support
but pressure from the Department for Energy and Climate Change
(DECC) to develop any successful exploratory wells.
"Any plans to develop a hydrocarbon discovery ... would be
the subject of a further planning application. The licensees
would be pressed to develop any commercial discovery by DECC,
the licensing authority whose duty is to encourage oil and gas
exploration and production activities in the UK," it says in its
supporting statement for development of one of its exploration
sites in Lancashire.
The planning outcome may more depend on how far the company
can garner local community backing including through generous
financial support, especially given well-flagged concerns about
tremors, truck movements and impacts on water quality.
(Editing by Keiron Henderson)