I am pleased to inform the House of the outcome of the strategic environmental assessment (SEA) which has been conducted for further onshore licensing.
This Coalition Government believes that shale gas has the potential to provide the UK with greater energy security, growth and jobs. Effective exploration and testing of the UK’s unconventional gas resources is key to understanding the potential for this industry so the Government is creating the right framework to accelerate unconventional oil and gas development in a responsible and sustainable way.
The last round of onshore licensing, the 13th, was conducted in 2008, and the Department began preparations in 2010 for a 14th Round. However, these were interrupted when two seismic tremors were triggered in April and May of 2011 by fracking operations at Preese Hall in Lancashire. Work on the SEA was resumed following the introduction of new control measures against seismic risks, and a new Environmental Report was published on 12 December 2013 for public consultation. The consultation closed on 28 March 2014, and some 2400 responses were received from a wide variety of bodies, organisations and individuals.
The draft Licensing Plan which is the subject of the Environmental Report proposes to invite applications for further petroleum licences in areas of Great Britain defined in the Report, so far as not already subject to license. Licences confer exclusive rights to explore for and exploit hydrocarbons within a specified area. However the conduct of any such operations would remain subject to all relevant legal permissions and consents, including the requirement for planning permission.
The Report assessed the likely significant effects on the environment of implementing the Licensing Plan, and of two alternative plans which were identified as reasonable. The Report did identify some negative effects with the potential to be significant in particular areas. But it concluded that those effects could be appropriately mitigated or made acceptable through the operation of the appropriate regulatory controls. Overall, the Report suggested that adoption of the Licensing Plan might be the most appropriate choice.
Responses to the consultation in general did not support that approach. There was strong support for the exclusion from licensing of environmentally sensitive sites, and in particular National Parks, Areas of Outstanding Natural Beauty and World Heritage Sites. Representations were also made on two legal issues: first, that the Environmental Report had taken into account certain economic benefits which were not proper to an SEA; and second, that no Habitats Assessment had been done.
As regards the first of the legal issues, I am advised that the legal arguments put forward cannot be regarded as settled. However, in the interests of removing any question of doubt about the basis of the decisions which are made and of avoiding further delay in the opening up of further licensing opportunities, I have decided that, in considering the environmental effects of the proposed licensing, I should disregard the economic benefits which have been questioned.
On the second of the legal issues, the Environmental Report makes clear that DECC will perform appropriate assessments, in full accordance with the requirements of European law, in respect of the area proposed for the award of any individual licence, before that award is made. Sites designated as being of international interest will therefore be given appropriate protection, in accordance with the relevant Directives; and where necessary to meet the requirements of the Directives, they will be excluded from licensing.
As to the proposals to exclude other categories of sensitive sites, the Government recognises the degree of concern which has been evidenced in the responses to the consultation. Lord Ahmad of Wimbledon (Parliamentary Under Secretary of State for DCLG) has today made clear the approach to planning for unconventional hydrocarbons in National Parks, the Broads, Areas of Outstanding Natural Beauty and World Heritage Sites. This recognises there are areas of outstanding landscape and scenic beauty where the environmental and heritage qualities need to be carefully balanced against the benefits of oil and gas from unconventional hydrocarbons. The guidance is available on the Minerals section of the Governments planning guidance website.
And as regards the issue of licences, we accept the recommendations of the Environmental Report that licence applicants should be required to submit a Statement of Environmental Awareness to demonstrate their understanding of environmental sensitivities relevant to the area proposed for licence, and to set out options for addressing those and their approach to establishing the eventual plan for operations.
In addition to the requirements proposed in the Environmental Report, the guidance for applicants will make clear that DECC will require these Statements to be particularly comprehensive and detailed where the areas applied for are in or adjacent to any National Park, the Broads, or any Areas of Outstanding Natural Beauty or World Heritage Site; and that applicants should demonstrate, in particular, their understanding of the implications for unconventional hydrocarbon development in the areas applied for of the following aspects of the planning guidance:
- that in National Parks, the Broads, and Areas of Outstanding Natural Beauty, mineral planning authorities should give great weight to conserving their landscape and scenic beauty, and to the conservation of wildlife and cultural heritage;
- that applications which represent major developments in those areas should be refused, except in exceptional circumstances and where it can be demonstrated that they are in the public interest;
- that where a proposed development would lead to substantial harm to or loss of a World Heritage Site, mineral planning authorities should refuse consent unless wholly exceptional circumstances apply.
DECC will assess all statements on the basis of the comprehensiveness of the issues addressed; the depth of understanding demonstrated of the relevant environmental sensitivities and heritage factors, and the provision of options for addressing these; adherence to good analytical and assessment practice; and access to expertise. Unless DECC is satisfied on these matters, the application will be rejected.
Many other issues and concerns, for the most part outside the scope of the Licensing Plan, were expressed in the responses to the consultation. A detailed summary of the issues raised is set out in a full Post Adoption Statement which will be placed on the DECC website. The Post Adoption Statement also provides responses on all the concerns which have been raised.
Taking account of the assessments made in the Environmental Report - subject to the disregarding of certain economic benefits as I have mentioned - and taking account of the opinions expressed through the public consultation, I have decided to adopt the Licensing Plan, subject to the mitigation measures proposed in the Environmental Report.
The full reasons for those decisions are set out in the Post Adoption Statement, which also sets out further detail of how environmental considerations have been integrated into the Plan, how the Environmental Report and the opinions expressed in the public consultation have been taken into account in the decisions which have been made, and of the measures for monitoring the implementation of the Plan.
I am therefore announcing today that we are inviting applications for new onshore licences in the area defined in the SEA, which should be submitted by 23 October 2014. Full details of the application process are provided on the DECC website.