There has been pressure to ban it as some say the process is environmentally unfriendly, with gas coming out of domestic water taps, ground water polluted by fracking chemicals and earth tremors caused by the pumping of high pressure water into rocks.
I can vouch that fracking is dangerous (but then, so is off-shore oil and gas production). I have seen wily old Texan frack teams pray on their knees before they start up the pumps.
And yes, the earth moved for me too when the frack pumps hit maximum pressure.
But a ban on fracking could deny the UK a bonanza perhaps the size of the North Sea oil boom of the 1970s and 1980s – one that could reduce our energy costs and transform the UK balance of payments which is currently in deficit.
So, how big is the UK opportunity? Well, the largest of the US fields is The Bakken which straddles North Dakota and Montana in the US and is producing 750,000 barrels of oil per day.
It is estimated that the Bowland shale, under Lancashire, can produce about half this output in gas and transfer £3.3bn annually to our balance of payments – and boy do we need it. You have to look no further than North America to see what fracking has done to the price of gas as production has increased 500pc over the past five years. Some think that the US will be a net gas exporter by 2020.
Gas prices there have fallen by near enough 70pc since 2008. Contrast this fall with the gas price in the UK, which has risen since 2009.
The International Energy Association estimates that towards the end of this decade the US will have almost doubled its oil production volumes – most of this increase will result from a massive expansion in its oil production realised through fracking.
The UK could also be transformed – but how do we play it? Look no further than power stations.
UK peak demand has a requirement for 60 gigawatts, but over the next year, nearly 12 gigawatts of production is to close and most of this is nasty old coal-fired power stations.
Kingsnorth, a 2 gigawatt coal-fired power station in Kent, closed two weeks ago ahead of schedule. This means that without new more environmentally friendly capacity coming on stream, the UK’s reserve margin (available capacity above peak demand) falls from 40pc to 15pc.
Clearly there is a need for this reserve to be re-established and there is an argument for cheap gas-fired powered stations.
Prior to the discovery of shale gas in the north, the Government’s response to this issue was heavily subsidised wind and biomass plants costing us all billions of pounds.
Shale gas has arrived in the nick of time to secure our energy needs and to reduce our economic burdens.
There are other effects from the discovery of new gas fields around the world which will aid the West just as low labour costs have boosted eTim Steer conomic development in the East.
We should be investing in them. First there are the asset plays of shale gas themselves, mostly in the US for now. Chesapeake and Santos are the current big ones but there will be others – perhaps in the UK.
Then there are energy intensive activities which will see costs fall – the chemical, fertiliser and cement industries will all see benefits and much of their production will move closer to cheap sources of power, meaning, if Britain gets this right, more jobs at home.
Also in the longer term cheap gas means that the UK can become a centre of excellence for cleaner and more efficient energy sources. The losers from cheap gas in the West, of course, will be the current oil and gas producers in the Middle East and Russia.
If shale gas in the UK goes the way it should, then, like the wily old Texan frack teams who thanked their lucky stars and prayed before starting up the frack pumps, there will be lucky Lancastrians on their knees and praying in Morecambe, saying all hail to the shale.
Tim Steer manages the Artemis UK Growth Fund