Britain is tightening controls on firms hoping to carry out hydraulic fracking in parts of the country by adding a financial health check to the application process, the government said on Jan. 25.
Substantial amounts of shale gas are estimated to be trapped in underground rocks and the British government wants to exploit them to help offset declining North Sea oil and gas output, create jobs and boost economic growth.
No fracking—which involves extracting gas obtained from rocks broken up or fractured at high pressure with water and chemicals—has taken place in the country in the past 7 years after operations were halted at the first British site following earth tremors.
The government has since imposed several environmental and technical requirements which must be met before any company can carry out the process. Energy minister Greg Clark said Jan. 25 that additional financial criteria must also be met.
“An equivalent assessment should be undertaken of the financial resilience of companies proposing to carry out hydraulic fracturing operations so that stakeholders can have confidence in the company’s ability to meet its commitments,” he said in a in a written statement on parliament’s website.
“We will therefore look at the financial resilience of all companies wishing to carry out hydraulic fracturing operations alongside their application for Hydraulic Fracturing Consent,” he said.
Third Energy, 95%-owned by Barclays Plc (NASDAQ: DTYS) is waiting for final sign off by Clark, to begin test fracking at its Kirby Misperton site in Ryedale, Yorkshire, northern England.
Clark said he was satisfied Third Energy had met the technical requirements, but is seeking further financial information about the company to help make his final decision.
Clark said Third Energy had not yet submitted financial accounts for the period ending in December 2016, despite a statutory deadline of September 2017 for them to do so.
No one from Third Energy was immediately available to comment.
Several firms hope to use hydraulic fracking in Britain, including shale gas developer Cuadrilla and petrochemicals group Ineos.
Environmental groups continue to be strongly opposed to fracking, concerned about the potential seismic activity and water contamination.
Recommended Reading
New US Rules Seek to Curb Leaks From Drilling on Public Lands
2024-03-27 - The U.S. Interior Department finalized rules aimed at limiting methane leaks from oil and gas drilling on public lands.
DOE Considers Technip, LanzaTech For $200MM ‘Breakthrough’ Technology Award
2024-03-25 - The U.S. Department of Energy funding will be used to develop technology that turns CO2 into sustainable ethylene.
Energy Transition in Motion (Week of March 22, 2024)
2024-03-22 - Here is a look at some of this week’s renewable energy news, including a new modeling tool for superhot rock.
EQT’s Toby Rice: US NatGas is a Global ‘Decarbonizing Force’
2024-03-21 - The shale revolution has unlocked an amazing resource but it is far from reaching full potential as a lot more opportunities exist, EQT Corp. President and CEO Toby Rice said in a plenary session during CERAWeek by S&P Global.
Investors: Energy Transition is on Policy-driven Life Support
2024-03-20 - Injecting private capital into the energy transition is worrisome because some projects couldn’t survive without government incentives, panelists said at CERAWeek by S&P Global.