Ineos, the energy and petrochemicals company controlled by Britain’s richest man, has “strongly hinted” to the UK regulator it will not apply for permission to frack in England unless rules governing the fledgling shale gas industry are relaxed.
Both Ineos and Cuadrilla, the only company so far to frack for shale gas in the UK, have been lobbying the government for a review of fracking rules that state a company must stop work if it triggers earth tremors of 0.5 or above on the Richter scale. The government has so far repeatedly rejected calls for any review.
Cuadrilla has been unable to complete tests of a shale gas exploration well at a site near Blackpool in Lancashire, after having to suspend work on several occasions last year when that limit was exceeded.
Ineos’s comments are one of the strongest suggestions yet that the privately owned company would be prepared to abandon its shale gas ambitions in England. They were made to Andy Samuel, chief executive of the Oil and Gas Authority, at a meeting on November 23 and were disclosed in a Freedom of Information request made by the Financial Times.
Official minutes of the meeting, which did not disclose those present, state that the company was “keen to have a dialogue” with the UK government on the 0.5 seismic limit, which Ineos believes is “artificially low”.
“They [Ineos] are strongly of the view that a sensible, realistic, scientifically backed limit is needed — otherwise it was strongly hinted they are unlikely to apply for consents to undertake fracking,” the minutes add.
Ineos, controlled by Jim Ratcliffe, has extensive shale exploration rights in Yorkshire, the east Midlands and Cheshire. It has this year been carrying out exploratory tests in Nottinghamshire.
Fracking, or hydraulic fracturing, involves pumping water, sand and chemicals under the ground at high pressure to release gas from rock formations.
The OGA has been dragged into the battle over the future of fracking after Cuadrilla urged the regulator to review data procured from its site at Preston New Road in Lancashire, in the hope this would lead to a scientific review of the so-called traffic light system that sets the rules on seismicity limits.
In February, the OGA said it would “carry out a scientific analysis” of the data gathered through Cuadrilla’s operations at the site as part of its “normal responsibilities as one of the regulators of this industry”. But it stressed the work was “not a review of the traffic light system”.
Cuadrilla hopes to do more fracking at Preston New Road later this year; it said last month it had moved “a range of specialist kit” back to the site, although crucially that did not include hydraulic fracturing pumps, indicating further work was still some way off.
Supporters of fracking, which has transformed the US energy industry, argue it would make the UK more self-sufficient in energy and reduce reliance on gas imports. But it is fiercely opposed by environmental groups and rural campaigners.
The opposition Labour party has pledged to ban it and the Scottish government has already ruled out the practice north of the Border.
Ineos declined to comment.