Cuadrilla is poised to spearhead the creation of a new UK industry in shale gas extraction, its chief executive has said, as the company prepares to resume “fracking” in Lancashire.
In an interview with The Sunday Telegraph, Francis Egan said the private-equity-backed company was ready to “press on quickly” once Ed Davey, the Energy Secretary, lifts a moratorium on the controversial process.
Cuadrilla, whose chairman is former BP chief Lord Browne, believes it could be producing shale gas in the UK by March next year.
“We are starting a whole new onshore gas industry. In our licence alone we can supply a quarter of the UK’s gas demand,” Mr Egan said.
Cuadrilla initially planned up to 800 wells but will need to secure local planning permission for each well.
The Chancellor will this week throw his weight behind plans for fracking, when he is expected to announce the creation of a new Office for Shale Gas to help shape the nascent UK industry.
Mr Osborne has already said he is considering tax breaks for shale gas.
Ministers will also unveil a new gas generation strategy, setting out plans for 20GW of new gas-fired generation – about 20 power plants – by 2030. The plans will alarm environmentalists but cheer those who believe shale gas could provide a source of cheap gas for the UK.
Mr Egan said: “Britain is spending tens of billions of pounds importing gas. If we are able to develop gas resources here . . . it could make a major difference for the country in terms of tax revenues, balance of payments and at a time when the economy is the pits.”
The moratorium on fracking – which sees water pumped into rocks to remove oil and gas – was imposed in 2011 after drilling by Cuadrilla caused two small earth tremors in Blackpool.
A decision to lift the ban had been thought likely earlier in the year after an independent Government-commissioned report recommended it resume. It is now expected soon after Wednesday’s Autumn Statement.
Mr Davey, who will take the decision in a quasi-judicial role, has said he will support shale gas exploitation only if it is economic and “can be carried out with the full protection of the environment”.
Cuadrilla may not be prepared to wait much longer. “If we get a negative decision this week, we would have little alternative than to walk away,” Mr Egan said.
“We have proven that there is gas and that it will flow. In the three years we have been doing tests, they have drilled 60,000 wells in the US. We don’t have infinite patience and our investors don’t have infinite patience.”