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Total became the latest company to join the UK fracking rush on Monday, as David Cameron said government was “going all out for shale gas”.
The French oil giant announced investment of up to £30 million in shale gas in the Midlands, in partnership with Ecorp, Dart Energy, Igas and Egdon Resources.
Total takes a 40 per cent share in two licences covering Lincolnshire’s Gainsborough Trough. The move is seen as a vote of confidence in the burgeoning industry.
Meanwhile, the prime minister promised local authorities will get to keep 100 per cent of business rates collected from shale sites in their area. That sweetener, worth up to £1.7 million for a typical site, comes on top of community benefits worth £100,000 plus 1 per cent of revenue for each well.
Cameron said: “A key part of our long-term economic plan to secure Britain’s future is to back businesses with better infrastructure. That’s why we’re going all out for shale. It will mean more jobs and opportunities for people, and economic security for our country.”
Industry body the UK Onshore Operators Group (UKOOG) took the occasion to launch its community benefit pilot scheme. It will be partnering with UK Community Foundations to direct the money to local causes.
Ken Cronin, chief executive of UKOOG, said: “The pilot scheme approach will allow us to learn at an early stage what works for the communities that we are operating in and how we can develop our schemes for the future. Working with UKCF provides us with the ability to have an independent national framework that establishes an industry standard with guaranteed quality and consistency.”
UKOOG and the government are also jointly funding a study into the skills and equipment the industry needs from the supply chain. It follows a report by the Institute of Directors which said the industry could create 74,000 jobs, reduce gas imports by 50 per cent and attract peak investment of £3.7 billion a year.
Business and energy minister Michael Fallon said: “The government is encouraging safe exploration for shale gas to go ahead as quickly as possible. It has huge potential to contribute to economic growth and provide another source of home grown energy over the coming decades. We want to ensure that the UK is ready to grow its supply chain and develop the necessary skills so that local communities benefit from jobs and investment.”
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