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Europe Moves Closer To Shale Gas Development

Shale Gas Europe

Yesterday, two major events took place, bringing Europe a step closer towards developing a domestic shale gas industry. In the UK the Infrastructure Bill has been given Royal Assent and in Germany the Federal Government held a public hearing on the planned hydraulic fracturing draft law.

The UK Infrastructure Bill is designed to simplify procedures for the onshore oil, gas and deep geothermal industries to access reserves 300 metres or more underground.  According to the Government further legislation will follow in July to provide more clarity on some of the specific amendments introduced  covering hydraulic fracturing, specifically exploration in National Parks and water protection zones.

In Germany, the Federal Environment and Economy Ministries hosted a public hearing in Berlin yesterday into its proposed draft law which seeks to regulate the exploration of unconventional resources in the country. A broad range of consultees gave evidence supporting the need to ensure that any exploration is conducted within an environmentally sustainable framework.  Equally clear was the need for a pragmatic approach to the Government’s energy policy to help provide security of supply and drive competitiveness. The Government is expected to finalise the draft outline in the coming weeks before submitting it to the Bundestag to be debated by Members.

Both the UK and Germany face critical energy challenges, becoming increasingly dependent on foreign imports. If this is going to be addressed effectively then both governments need to find alternative sources of domestic production. Renewables can only provide part of the solution.

In the UK production from the North Sea continues to decline. Total energy production was 6.6% lower in 2013 than in the previous year, resulting in an increase in imports of 2.3% and rising UK’s import dependency to 47%.

Germany is also seeing a significant rise in imports. In 2013 it imported 63% of its energy from abroad, an increase of 2% in 2012.  Its energy dependency is at its highest in 20 years and is currently 10% higher than the EU average. Germans however seem aware of the need for a pragmatic approach. According to a public survey conducted last October by Forsa, the leading market research and opinion polling institution, 70% of German citizens support the idea of exploring and assessing unconventional resources. 79% are also aware of the fact that natural gas and oil will be required to ensure a safe and affordable energy supply for the foreseeable future.

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