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Fracking Update

Fracking UpdateYou can't keep it out of the news at the moment. Now that fracking (or at least Cuadrilla) is threatening the south of England all the national papers are taking note of it, and it's on the TV screens every night.

There's enough going on with that to make a story in itself. But the real news is much more prosaic.

TAX BREAKS
===========

First we had the Government's announcement that it would be cutting the tax on some of the income generated from fracking from 62% to just 30%.

The Government said these plans will make the UK the "most generous" regime for shale gas in the world. The Chancellor George Osborne said shale gas was a resource with huge potential for the UK's adding "We want to create the right conditions for industry to explore and unlock that potential in a way that allows communities to share in the benefits,"

Under his plans, the tax reduction would apply to a proportion (to be determined) of the income generated from shale gas production. Government has also confirmed plans to give communities that host shale gas sites £100,000 per site, and up to 1% of all revenues from production.

There have since been arguments about whether 'the site' is per well fracked or per shale gas pad.


PLANNING GUIDANCE
==================

But undoubtedly, the most important issue is DCLG's release of "Planning Practice Guidance For Onshore Oil And Gas"

We're very uncomfortable with it.

In essence it appears to be designed to allow Government to hide behind the Mineral Planning Authority (In our case the Lancashire County Council) who, it has been confirmed, will remain the authority to receive and determine planning applications for shale gas exploration and extraction.

Now at first sight, you might expect rejoicing in the streets at that decision.

More than once we have said were fearful that it would most likely be passed to the Large Infrastructure Planning Commission who would be unmoved by public opinion.

And we should be rejoicing if keeping it with LCC was the whole story.

But it is not.

As well as confirming the County as the planning authority, the document sets a great many constraints on what the planning authority may (or more particularly may not) take into account when considering the matter and reaching its decision.

For example, the guidance effectively requires the County Council to focus on whether the land use is an appropriate one. It says at Para 29 "In doing so the focus of the planning system should be on whether the development itself is an acceptable use of the land, and the impacts of those uses, rather than any control processes, health and safety issues or emissions themselves where these are subject to approval under other regimes. Minerals planning authorities should assume that these non-planning regimes will operate effectively."

So the guidance effectively says just listen to the experts and take their view, chiefly the Department of Energy and Climate Change, the Health and Safety Executive, and the Environment Agency.

Now, having seen these folk in action, and heard them first hand at our MP's excellent 'Shale Gas Panel' meeting on 25 July last year, we were less than impressed. Their lack of hands-on control and the lack of co-ordination between them gave almost everyone present cause for concern.

Clearly there needed to be (as Mike Hill had long called for) an overarching regulatory body.

And what did we get?

We got the Office of Unconventional Gas and Oil, who is not a regulator at all. As their website says- OUGO "aims to promote the safe, responsible, and environmentally sound recovery of the UK’s unconventional reserves of gas and oil."

So it sees (or has been given) its role as promoting fracking, not regulating it. At best it is a co-ordinator of the existing regulatory agencies that have proved to be ineffective.

In oral evidence (given to the Energy and Climate Change Committee considering the Impact of Shale Gas on Energy Markets on Tuesday 11 December 2012, at question196), Sir Robert Smith asked: "I suppose that is the problem, that it all interconnects, but on the specifics of shale gas what do you think the role of this body of office for unconventional gas and oil will be? Will it be a poacher or a gamekeeper?"

Professor Anderson replied : "Disturbingly it is both and that is the concern. It is the fox looking after the chickens. It does seem an odd thing to set up something that will promote and regulate."

We saw this as the first glaring error Government made.  In its desire to dash for gas cash, it has failed to produce a unified body to regulate the industry.

Companies like Cuadrilla welcome regulation because it puts cowboys at a disadvantage.

If that decision on the 'regulator' was the first error, the second is the Guidance that the UK Government has just issued. It is imbalanced toward the industry to the extent that, just as Jessica Ernst from Canada predicted would happen (having been through this process herself), it will, when more widely known, water and nurture the seeds of distrust amongst the population.

As an example of this you need read no other than paragraph 66 of the Guidance which says "Mineral extraction is essential to local and national economies. As stated in paragraph 144 of the National Planning Policy Framework, minerals planning authorities should give great weight to the benefits of minerals extraction, including to the economy, when determining planning applications."

Planning permissions are a matter of 'for and against'. They all boil down to the weight given to each argument advanced, and here, as plain as the nose on your face, is the Government telling the planning authority to place great weight on the potential economic benefits.

What they have done with this Guidance is tie the hands of the Mineral Authority behind their backs and said "OK off you go, it's your job to decide it"

And when the decision is to approve and people are angry, Government will say "Nothing to do with us guv, it was Lancashire County Council what dun it"

Fortunately, we don't need to do a thorough article on the Government's guidance in this matter, that's already been done better than we could do it - by Alan Toothill of Defend Lytham.

Readers should follow this link for Defend Lytham Response to the Government's Planning Guidelines for Shale Gas. It really is a first class analysis.

ADJOURNMENT DEBATES
=====================

The House Of Commons held two adjournment debates on Shale Gas as Parliament broke up for the summer. One was on 16 July and introduced by our MP Mark Menzies.

Readers can, and those interested should, follow this link for a transcript of this full debate, but we're going to pick out a few highlights.

He said he firmly believed that further work remains to be done on a range of issues, most notably on regulation, community engagement, the development of a UK supply chain and the suitability of potential sites.

We absolutely agree

He went on to note that he has consistently campaigned for the regulation of the shale gas industry, and in his Adjournment debate in October 2012, he set out the need for a body to be formed to oversee the workings of the regulatory bodies on matters relating to onshore oil and gas development.

He went on to say that the Office of Unconventional Gas and Oil must take on responsibility for ensuring that the existing regulatory bodies, namely the Health and Safety Executive, the Environment Agency, DECC and Lancashire county council as the planning and mineral rights authority in Lancashire, work together to deliver a world-leading, gold-standard regulatory framework.

He also urged the avoidance of terms like 'streamlining' of regulations, a theme picked up by Blackpool South's Gordon Marsden MP who said he wanted to hear words like 'robust' in connection with regulations, not words like 'streamlined' and he agreed with what Mark Menzies had told the Blackpool Gazette—that he would be “inflexible on the point that there must be a gold standard of regulation reached before any potential move to the extraction phase.”

We would have preferred a call for a single unified regulator rather than a co-ordinating and promotional body which is what, in effect, we have been given, but the call for proper regulation is spot on.

He also said that in his first Adjournment debate, he stated his strong opposition to the suitability of the Anna’s Road site for potential shale gas extraction, and his position remains unchanged, so he welcomed the announcement from Cuadrilla that it has put on hold any potential development of the site.

We have heard a variety of reasons for the postponement of this site, including an inability to get the cement to properly function as an outer coating in the peat soil in that area, and the fact that it is 'Functionally Linked' to the Ribble and Alt Estuary SSSI. Whatever the reason, we would not be surprised to find Anna's Road is now a dead duck as a fracking site.

Eric Ollerenshaw (Lancaster and Fleetwood) drew attention to the risk that 'community benefit' paid by the fracking industry might simply be seen as a way of reducing the money that Government currently pays to local authorities and he wanted to know what guarantee there was that the Community benefit would be additional to 'ordinary' Government spending.

A slightly less well tempered debate took place on 18th July in Westminster Hall. Readers can follow this link for the full text.

Green MP Caroline Lucas launched a strong criticism of Government policy, including this quote "It is also pretty appalling that the new planning guidelines are set to come into force without public consultation, denying communities that stand to be affected by fracking any say in the new process. It is clear that Ministers and the fracking firms, which are, sadly, increasingly indistinguishable, are keen to press on rapidly, but it is wrong to refuse to consult on new planning guidance aimed at making it easier for developers to cast aside community concerns."

She also drew attention to the Treasury's proposed reduction in the tax payable on income from 62% to 30% adding that in her view, tax breaks for fracking amount to an additional fossil fuel subsidy, which is exactly what the UK and other G20 nations pledged to phase out three years ago.

She also said "The new office has been given the role of cheerleader-in-chief for the shale gas industry, as well as being tasked with ensuring that shale development remains safe and the environment protected. We heard that it would also play a third role, providing information to the public on apparent myths to help people separate fact from fiction. However, the office and the Minister’s whole Department are so rampantly pro-shale gas that I cannot see how the public will have confidence or trust in them either to maintain the highest safety and environmental standards or to provide independent, credible, non-biased information about the risks of shale gas development. How does the Minister intend to manage that perceived conflict of interest?"

Needless to say those from the Government disputed her comments.

Undaunted she continued and attacked the proposed Deregulation Bill that has been proposed (We plan an article on this shortly), saying "The proposed growth duty to be imposed on non-economic regulators such as the Environment Agency through the draft Deregulation Bill is of great concern in that respect. The Government claim that it will support growth without weakening environmental protection, but lawyers from the UK Environmental Law Association warn in their consultation response that “A growth duty, as currently proposed, would make it harder for non-economic regulators to refuse environmentally damaging development, including those that threaten nationally important wildlife sites -even if the overall societal benefits of such a refusal are greater than the development This arises because the proposed duty does not adequately reflect evidence about the economic value of the natural environment and the need to value it accordingly in decision making.”

She concluded that Ministers have a lot of explaining to do before anyone will be persuaded that this growth duty is not simply the latest attempt to weaken crucial environmental and public health safeguards, capitulating to corporate lobbyists who want short-term profit-making to trump public interest.

And so the debate continued, ranging (perhaps predictably) over climate change and community benefits.

Barbara Keeley (Worsley and Eccles South, Labour) said "The hon. Member for Brighton, Pavilion has already referred to the fact that on 27 June the Government published their document on infrastructure investment, which stated that they intended this month to publish measures 'to kick start the shale gas industry in the UK'.

The measures were to include guidelines that, as she said, are not currently available. I am concerned about that, so can the Minister shed any light on why they have not been published? Most alarmingly, the 27 June document stated that the Environment Agency would 'significantly reduce the time it takes to obtain environmental permits for exploration.'

A process seems to have been built in for fast-tracking or streamlining permits in a standard period of 13 weeks from August, but in as little as six weeks in some cases. Alarmingly, by February 2014 permits will be issued within one to two weeks, based on standard rules. Will the Minister tell us what we can expect with the new planning and permit regime, so that I can pass that on?"


The more we see that Government is doing, the more we see them taking the same road as Canada, which has led to very serious problems for some of its residents. See our report 'Jessica Ernst V Canada'

In response, and not one to mince his words, Peter Lilley (Hitchin and Harpenden, Conservative) argued "The current cost of electricity produced from gas or coal is £50 per megawatt-hour. The current cost of producing it from windmills is £100 per megawatt-hour. For offshore windmills, it is £150 per megawatt-hour and for solar it is off the scale. If we think that we will get cheaper, lower energy bills by going to energy sources that are two, three or four times as expensive, we are living in la-la land."

There is much more of this wide-ranging debate for those wanting to see it in the Daily Hansard

The debate concluded with Michael Fallon (Sevenoaks, Conservative) who said "We have created the Office of Unconventional Gas and Oil to co-ordinate the activities of the regulatory bodies and Departments. We have a world-class safety and environmental regime with a joint approach to inspecting new exploratory operations, and for new and first-time operators, their key operations will be inspected, including the cementing and the main hydraulic fracture."

Which seemed a little bit at odds with his subsequent private comments as reported in the Sunday Mail of 3 August.

FALLON SLIP
==========

It was the sort of unguarded comment that tells you what they really think but hope that no-one will find out about it.

Conservative Minister Michael Fallon from Kent,  Minister of State for energy in the Department of Energy and Climate Change, the man responsible for fracking in the UK was reported by the Mail to have said....

"The second area being studied is the Weald. It’s from Dorset all the way along through Hampshire, Sussex, East Sussex, West Sussex, all the way perhaps a bit into Surrey and even into my county of Kent. It’s right there.

‘The beauty of that – please don’t write this down – is that of course it’s underneath the commentariat.

‘All these people writing leaders saying “why don’t they get on with shale?” – we are going to see how thick their rectory walls are, whether they like the flaring at the end of the drive!

'That's where the second great belt of shale is."


Site OperatorAccording to the Mail, the target of his jibe might have been Charles Moore (Editor for the Spectator and the Telegraph) who lives about 35 miles from Balcombe where Cuadrilla are test drilling.

He is also chairman of The Rectory Society, which seeks to protect old rectories.

Interestingly, the first fracks are also beginning so show within Government as the coalition Liberal Democrat President Tim Farron predicted that opposition to fracking would grow stronger than the campaign against wind farms.

And, of course, George Osborne's relative in the House of Lords didn't help matters much with his description of the 'desolate' North East as a place suitable for fracking when he actually meant the North West.

It's not exactly how to win friends and influence people is it?

WYRE SLIP
=========

Staying on the theme of oral errors, Wyre Councillor Gordon McCann has delivered a boob of huge proportions. A shale gas conference (Shale Gas World UK 2013) that he attended heard from him and another councillor from Frodsham. It was suggested that fracking companies could get under the skin of their communities by using schools and letting children carry the message home.

Cllr McCann (who is the Economic Portfolio Holder for Wyre) apparently suggested that that local groups 'Residents Action Against Fracking' and 'Frack Off' had broken into the Royal Bank of Scotland in London.

Now we know the Chairman of RAFF (or at least the chap who usually chairs their meetings) and he's a decent moderate sort. He chairs his local park's 'Friends' group and does a lot of voluntary community work for the St Annes in Bloom initiative. Same chap who found a wicker basket with £21,000 on his doorstep and said if it was not claimed he would use it to benefit the park (which he did). So he was putting money into a bank, not taking it out. And to suggest otherwise of this local hero is a really stupid move. He's a community-minded, decent, responsible and reasonable chap and, to be honest if what Cllr McCann had said in public about us what he said about RAFF, we'd be after another very large donation from Cllr McCann for the park, or for St Annes in Bloom, or whatever.

Wyre Council saw the potential for 'reputational damage' as they call it these days, and published the following

"Councillor Gordon McCann has asked that we post this message directly to you on his behalf:

“I would like to fully retract and unreservedly apologise for the comments I made towards the end of the Shale Gas World UK debate in June. The comments I made about Residents Action on Fylde Fracking and Frack Off that they were involved with the break in of the Royal Bank of Scotland and reclaiming the streets of London were wrong and unfounded.

I am deeply sorry for any offence this may have caused to anyone associated with either group and ask that they accept my unreserved apology”


Wyre subsequently also published this statement:

“in view of the fact that he made the comments, in any debate about fracking where a decision is to be made, he will declare an interest and take no part in the decision making process.”

That's a most unusual move. Normally only interests where you, or a close family member, have a benefit (something like a financial interest) require councillors to refrain from taking part in a debate. This has set some of the anti-fracking folk chasing around to see if there is more to be dug out on this matter.

We also heard that some of the folk involved were calling for his resignation as a councillor and Cllr McCann was rebutting the call.

We'll keep an eye on this matter for our readers.


ARUP MEETING
============

To Elswick, where Cuadrilla were holding an explanation and consultation event as part of their new environmental drive.

Readers might remember that, as we published in our two issue article back in February (Democracy & Localism + Fracking), Cuadrilla appear to have been very badly advised about the regulations governing Environmental Impact Assessments, and had suggested they should exclude a whole host of issues that we thought contradicted the regulations on EIAs.

As a result we, (and others with much more knowledge of these things), contacted Lancashire County Council to remind them of the requirements of the regulations. Shortly after that, Cuadrilla announced they would be putting things on hold whilst a proper environmental study was done.

They did exactly the right thing.

They have now appointed Ove Arup ("We are an independent firm of designers, planners, engineers, consultants and technical specialists offering a broad range of professional services. Through our work, we make a positive difference in the world. We shape a better world.") to undertake the necessary work.

It will be a big job and take anything up to 18 months to complete, so hopefully it will be thorough. Mind you, it was another branch of Ove Arup who said that the public concern about congestion outside Blackpool Tower (caused by the ludicrous shared space scheme) was merely 'anecdotal'.

So we can only hope the sub-set that are doing Cuadrilla's environmental work are a bit more reliable. We've not seen Arup's environmental work before so we've no experience of them.

The Public Meeting was in Elswick Village Hall, set out with display boards ranged round the perimeter of the room, Radio interviews were being done outside by Radio Lancashire, TV cameras were popping in and out and (whilst we were there) about 50 or so people were inside looking and discussing, including discussions with Cuadrilla's CE and representatives from Ove Arup.

Radio Lancashire interview Gayzer

We were asked to sign in and given a consultation form to complete, on which we were asked to set out our concerns about the various stages in the process (preparation, execution, aftercare and so on). After that we browsed the exhibition.

We saw lots of faces we knew and spoke with quite a few.

Elswick meeting

We suppose Cuadrilla got what they were after, lots of forms filled in to help make sure they at least address the points that are of concern to local people.

We thought Elswick was a bit of an unusual place to hold such an event. Cuadrilla would no doubt argue it was convenient for them as they had a wellhead nearby.

Actually we don't think they have owned it for that long. Our understanding - from someone who worked on its maintenance - is that it was first erected in the 1960s and tapped into a natural gas envelope that stretches from the Wyre to the Ribble at Freckleton and has Elswick at one of the highest points.

It is a very small operation - so small it's really difficult to find. We believe Cuadrilla acquired it more recently and some say they claim to have fracked it. We struggle to see how that could have happened, but we're not experts in drilling for gas.

As we said in our very first fracking article ('Gas Exploration') reporting the first public meeting at the YMCA back in January 2011....

"Another [person attending the meeting] said what people may not know was that there was a gas wellhead in Elswick, and had been since 1962. It became unviable and was closed down, but re-opened in 1991 and has been producing gas ever since - just as it is today.

This chap worked on the project and said hardly anyone knew it was there.

And to be honest, although we knew there had been drilling in the 1990s we had no idea it went back to the 60s, and absolutely no idea it was producing gas and turning it into electricity for the National Grid on the site at Elswick today.

Even people that we know who were born in Elswick don't know about it.

Admittedly, as the chap told us after the meeting, that well is drilled into a pocket of natural gas that stretched from the River Wyre to Freckleton, and it didn't use the 'fraccing' technique, but he said it did show that natural gas could be extracted and contribute to our energy needs without causing unsightly scars on the landscape, and poisoning the earth and water."


We thought Elswick might have been a bit inconvenient for the majority of people who live in the coastal strip, so we've found that Cuadrilla have published a blank form for you to fill in. Readers who'd like to comment can follow this link to obtain the form 

and follow this link for information from the Exhibition boards.

Cuadrilla ask for completed forms to be returned by August 12, to Freepost: Cuadrilla ERA, RS KS-SBBE-LHHZ, PPS Group, Hannover Street, 30-32 Charlotte Street, Manchester, M1 4FD.

Their website also has an email address enquiries@cuadrillaresources.com where you can request a paper copy of the consultation form.

For those that might want it, RAFF have devised a standard letter which gives wording for the consultation response. We're not much in favour of stereotyped responses like this, but if you want some ideas about phrasing and issues that you might want to adopt and adapt, it could be worth a look. Please follow this link for the RAFF standard letters  * (See UPDATE at end)


WHERE ARE WE UP TO?
====================

So where are we now?   Well, in summary we assess the present situation as follows:

Horizontal fracking

Before 2011, hardly anyone in the UK outside the oil and gas industry had heard of fracking. But since the exploratory drilling began in Fylde - some of it very badly handled by Cuadrilla - public opinion slowly began to move against it.

Imperceptibly, local people with strong environmental views and perhaps some with a quasi political agenda, became mixed with residents who are concerned about the effect of fracking on their lives and property, and it is now difficult to untangle those threads.

Furthermore, now that a front has opened in Balcombe in Sussex, national media attention has been aroused, and it is hitting the headlines.

The 'political' and 'provisonal' wings of what is now evolving as a national anti-fracking movement are continuing to shift public opinion against fracking nationally. There are a lot of underlying agenda in play here, so many, in fact, that it reminds us of the foxhunting debate.

The Government has started to make exceptions to favour fracking and to bend established rules - that's a really worrying sign.

But Government itself is starting to show signs of cracks now that large scale media attention is trained on the matter. That's significant, but not yet a problem.

The media attention is now attracting political activists who have little connection with local people - for example, it's reported in the Telegraph of 6th August 2013 that "Thousands of climate change activists are to ‘occupy’ a small village in Sussex for a week of ‘civil disobedience’ against fracking" when the village itself has only 1,700 residents.

Like the 'Occupy' movement outside St Paul's last year (and the "Occupy London" website is now full of fracking news), what we see here is, in essence, fracking being embraced as another cause celebre by those supporting various anti-capitalist movements.

Whilst that gives it more profile, it also drowns out the voice of local people, and that, in turn, isn't going to win hearts and minds in Parliament. It also risks alienating Joe Public and thus becoming the next anti-capitalist movement to be marginalised by the mainstream, as have others before.

Whatever else it is, the great fracking debate has now gone national, and it is certainly interesting to watch as the situation continues to unfold.

Dated:    8 August 2013

UPDATE 9 AUGUST 2013
Although the standard letters were on RAFF's website we missted the bit at the end that says the letters were created by REAF which is the Ribble Estuary Against Fracking group. They asked us to make that clear, and to provide a link to their website. We're happy to do so

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