What is fracking?
Hydraulic fracturing, commonly referred to as 'fracking' is an operation in which a mixture of water, sand and chemicals are pumped at high pressure through boreholes into gas bearing rocks. The water opens up cracks in the rock, and the sand grains lodge into the spaces allowing gas to be released and travel back along the borehole. In the UK this is most commonly associated with shale gas. Shale gas extracted via fracking is an 'unconventional hydrocarbon' unlike the conventional hydrocarbons currently extracted in Dorset.
Will fracking for shale gas ever happen in Dorset?
To date applications to explore for possible oil or gas resources in Dorset have only concerned conventional hydrocarbons (oil and gas reserves contained within specific reservoirs, sometimes within rock, that are normally extracted through drilling). No applications have ever been submitted in Dorset for shale gas test wells or for production of shale gas via the method of fracking.
Given the public sensitivities over the fracking process, the most recent planning permission granted for a conventional exploratory test well (at California Quarry) included a condition which prevents any fracking from taking place (purely as a precautionary measure as a separate planning application for extraction would be required in any case).
It is likely that there are shale gas resources in Dorset, but as yet, the full extent and location of these resources is unclear. There is also considerable uncertainty as to whether the geology in Dorset would prove to be suitable for fracking or that it would be financially viable.
Shale gas - Incentives for local communities
In January 2014 the Government announced that it would allow local councils to keep 100 per cent of business rates they collect from shale gas well sites (previously 50 per cent), which could be worth up to £1.7 million for a typical site. Community benefits for local people have also been strengthened with local communities receiving up to £100,000 from the industry for any test well that is fracked, and a further 1 per cent if shale gas is discovered - estimated to be worth between £5-10 million for the life of a typical well (see information on local councils to receive millions in business rates from shale gas developments on Gov.uk website for details).
It is important to note that such incentives would not affect the determination of planning applications. The Mineral Planning Authority will consider all applications in the light of its adopted planning policies and will make a judgement as to their acceptability or otherwise in planning terms.
Petroleum Exploration and Development Licenses
The Government, through the Oil and Gas Authority (OGA), is responsible for issuing onshore and offshore Petroleum Exploration and Development Licences (PEDL). Licences are usually awarded to bidders who can demonstrate they are able to optimise exploitation of the UK's petroleum resources.
On 17 December 2015 the OGA announced that licences for a total of 159 blocks across England and Wales were formally offered to successful applicants under the 14th Licensing Round for onshore oil and gas licences. The award of licences was subject to a Habitats Regulation Assessment (HRA). The HRA assesses whether there are any likely significant effects upon designated European sites protected under the provisions of the EU Habitats Directive. The HRA concluded that 132 of the 159 blocks would have 'likely significant effects' on European sites and thus would require a more detailed 'Appropriate Assessment', including all nine of the blocks that fall within Dorset. The Assessment concluded that all but one of the Dorset blocks (i.e. eight in total) would need to be the subject of specific conditions to restrict the type of activity that could take place at or near the boundaries of European designated habitats. In practice this would prevent exploration drilling, hydraulic fracturing (fracking), production development or associated maintenance within European protected sites. It is our understanding that this would not necessarily prevent directional below-surface drilling from beyond a European site boundary.
The nine Dorset blocks awarded as part of the 14th Round include four blocks in Purbeck that are licensed for conventional hydrocarbons (which cover existing operational well sites at Wytch Farm as well as two blocks awarded to Infrastrata, the company with a planning permission to carry out exploratory drilling at California Quarry).
The remaining five blocks cover a geographical area which stretches from the Piddlehinton area in the west to the Poole/Bournemouth/Wimborne area in the east, as well as part of Purbeck to the west of Wareham and the licence round offer relates to shale for these blocks.
This licensing round received a lot of national media attention because it is being associated with the controversial extraction method of hydraulic fracturing or 'fracking' of shale gas. However, it is unlikely that companies will seek to pursue shale gas extraction in areas where it is unviable or where the geology is unsuitable.
Once a company has a License, can it develop a well site?
The issuing of a Licence has no bearing upon the need for planning permission or any necessary environmental permits to explore or extract oil and gas. If and when a company decides that it wishes to explore the potential for oil or gas extraction within its licence area, it needs to apply to the Mineral Planning Authority (BCP Council) for planning permission. This must show where the well site is intended to be located, together with details of the site layout. A separate planning permission is then needed for the production phase if the exploration/appraisal phase identifies potentially viable reserves.
Production of oil and gas is likely to have a bigger impact than a test well. For this reason there is no automatic right to consent for production even if permission has previously been granted for exploration. In all cases planning applications need to be considered having regard to the Bournemouth, Dorset and Poole Minerals Strategy (adopted in May 2014), which sets out policies on exploration, appraisal and production of hydrocarbons, and the National Planning Policy Framework and associated guidance.
Will the importance of Dorset's environment be a consideration?
In parallel with the latest oil and gas licensing round the Government produced additional planning practice guidance on unconventional hydrocarbons (which covers fracking of shale gas). This emphasises that where applications for unconventional hydrocarbons represent major development, '...planning permission should be refused in National Parks, the Broads and Areas of Outstanding Natural Beauty [AONB] except in exceptional circumstances and where it can be demonstrated they are in the public interest'. It adds that 'World Heritage Sites are heritage assets of the highest significance. Where a proposed development for unconventional hydrocarbons would lead to substantial harm to or loss of a World Heritage Site, mineral planning authorities should refuse consent unless wholly exceptional circumstances apply'. However, in December 2015, MPs voted to a change which would allow fracking 1,200 metres below the surface as long as the drilling takes place outside protected areas.
In Dorset, significant parts of the County are within AONBs, while much of the coast is a designated World Heritage Site, although these are not the only relevant considerations. The adopted Minerals Strategy sets out a comprehensive range of environmental and other matters that need to be taken into account.
How will planning permission be decided?
BCP Council, as the Minerals Planning Authority is currently responsible for determining any planning applications for hydrocarbon (oil and gas) development in the County. This would include fracking proposals should any ever be submitted for consideration. Planning applications will be judged on the basis of the adopted Minerals Strategy which contains a range of policies against which proposals will be considered. The Mineral Planning Authority will also need to consider the national planning policy position regarding conventional and unconventional hydrocarbons. We will therefore take into account the potential impact of proposals on the local community, environment, natural resources and economy to ensure that the people and special qualities of the county are safeguarded.
The Government is considering the possibility of bringing major projects for the fracking of shale gas within the Nationally Significant Infrastructure Projects regime. If this occurs, planning applications would be determined by the Secretary of State rather than the local mineral planning authority. Under these circumstances, local authorities would respond to the consultation and could prepare a local impact report, but would not be responsible for the decision.
In addition, the Government is also considering bringing exploratory drilling for shale gas within the regime of 'permitted development', which would mean that planning consent would not be required. It has stated this would not apply in sensitive areas such as AONBs. Proposals to extract shale gas will however remain subject to planning controls.