Industry-wide charter sets out local shale benefits

An industry-wide shale gas charter is to offer communities a £100,000 benefit for hosting hydrualic farcturing wells for exploration and a further 1 per cent of revenue should a well go into production.

The deal is an industry-funded initiative in conjunction with the United Kingdom Onshore Operations Group (UKOOG), which will provide £100,000 for the local community within the vicinity of the hydraulic fracturing site on exploration and a further 1% of revenue should the fracking plant go into full production of shale gas (before all costs of production are taken into account and based on producing wells only).

Ken Cronin, chief executive of UKOOG, said: “Today’s announcement underlines our commitment to the local communities we work within. The economic benefits of our industry will be experienced nationally as our products provide energy, security, economic growth and revenue to the Exchequer.”

Speaking to the BBC the UK chancellor George Osborne said: “We are saying local communities must benefit from this new form of energy and we’re saying local communities should get for example £100,000 for every fracking well that’s created.

“We’re making sure local communities feel part of it. This is what’s happened in the United States and it’s made it a real success of it.”

Last week, a spokesman from the DCLG told Utility Week there are no plans to pay communities for hosting shale gas wells in the same way benefits are offered to communities that host onshore windfarms.

He said: “The planning rules are what the planning rules are and they haven’t changed for shale gas extraction.”

Anti-fracking campaigners are unconvinced the financial benefits package for local communities close to shale gas wells is not enough.

Lawrence Carter, energy campaigner at Greenpeace, said: “Whilst communities should receive benefits from local energy development, a cash package won’t alleviate concerns about fracking’s impact on water supply and house prices.”