U.K. Shale Regulation Inadequate for Safety, Report Says

Jul 21, 2014 9:12 am ET

(Updates with legal blockade in sixth paragraph.)

July 21 (Bloomberg) -- Shale gas exploration in the U.K. lacks adequate regulation to protect public health and the environment including water shortages, according to a report by scientists.

Exploitation of the resource may also undermine efforts to tackle climate change, according to the document published today by the Scientists for Global Responsibility and the Chartered Institute of Environmental Health.

The hydraulic fracturing process, which pumps water, sand and chemicals at high pressure to release fuel trapped in underground shale rock, may cause water shortages in parts of the country. It may also cause house prices to drop, according to the report.

“There is widespread concern that, even with strong regulation, the safety of fracking for the U.K. is in doubt,” according to the report.

The government is offering tax breaks to drillers to spur development to counter declining North Sea oil and gas and rising energy imports.

An area in northern England known as the Bowland basin may hold 1,300 trillion cubic feet of gas, enough to supply the country for almost half a century, even if just 10 percent is extracted. Opponents fear earthquakes, water contamination and an industrialization of the English countryside.

Landowner Suit

A group of landowners today launched a legal action to prevent shale drilling in Sussex, southern England, according to an e-mailed statement from Greenpeace. Local council authorities tomorrow are scheduled to decide on whether to grant Celtique Energie Ltd. planning permission for its site at Wisborough Green.

Celtique said its drilling will take place entirely within land it has a leasing agreement for.

“If horizontal drilling were proposed as part of a future planning application, we would also fully comply with the planning and regulatory regime in place and the law with respect to drilling under the land of neighbouring landowners,” the company said in an e-mailed statement.

The U.K. last month proposed legislation to make it easier for companies to explore for shale oil and gas by not having to seek permission from every landowner under whose property a well may pass.

Celtique was forced to withdraw a planned horizontal well at a second site in the area in May.