The Secretaries of State for Communities and Local Government and Energy and Climate Change (Greg Clark and Amber Rudd) have announced a more interventionist role for central government in determining planning applications for onshore oil and gas development. The announcement takes the form of a joint ministerial policy statement having been trailed beforehand by media comments from Amber Rudd. The new measures include an expressed intention to consider whether to call in or recover applications; diverting decisions from councils that consistently fail to determine oil and gas applications within the statutory timeframe and ensuring planning call ins and appeals handled by the Planning Inspectorate are given priority.

The ministerial statement makes clear the Government's view that there is a national need to explore shale gas opportunities and that local planning authorities (LPAs) should reflect this need in their decision making. This statement marks a recognition of Government aims for a more efficient and timely system for shale gas planning applications.

The core proposals for speeding up planning decisions are fourfold

  1. LPAs are expected to issue decisions within the existing legal timeframe

The ministerial statement stresses that LPAs should determine applications within the statutory timeframe (16 weeks where an environmental impact assessment is necessary). They should agree with the applicant upfront the timeline and anticipated decision date. The LPA should take full account of existing planning guidance stating that matters subject to regulation by other regulators, such as the Environment Agency, should be left to those bodies to determine. The use of Planning Performance Agreements is also encouraged where appropriate.  

  1. Where an LPA repeatedly fails to meet that expectation, applications may be redirected to the Secretary of State

The Government will identify LPAs who repeatedly exceed the deadline for determination of onshore oil and gas applications. When new applications are made to that LPA, the Secretary of State will determine whether he should determine the application himself instead.  The suggestion is that this will be from the outset such that the planning officers of the LPA will not be expected to start considering the application – but this is not expressly stated.  

  1. Even where there is no delay by an LPA, the Secretary of State will actively consider taking it out of the LPA's hands.

The Secretary of State has committed to "actively considering" calling in all shale applications.  Each case will be considered on its individual merits, and once called in will be given high priority.  

  1. If consent is refused or not determined on time and the applicant appeals, the appeal will be dealt with as a priority by the Planning Inspectorate but may be recovered by the Secretary of State.

The Planning Inspectorate will treat shale gas appeals as a priority and the Secretary of State for Communities and Local Government will consider recovering any shale gas appeals so that he personally makes the ultimate decision rather than a Planning Inspector. This new measure will be added to the recovery policy issued on 30 June 2008 and will be applied for two years before being reviewed. 

Community benefit

Plans for the sovereign wealth fund designed to share production proceeds with the local community are to be released later this year. The idea of creating such a fund was included in the 2014 Autumn Statement and the Conservative election manifesto.

Boreholes – extended consultation

The Government has also published its response to the consultation on amending permitted development rights to allow the drilling of boreholes for groundwater monitoring and plans to take the proposal forward. Alongside this, the Government is inviting views on proposals for further permitted development rights for the drilling of boreholes for seismic investigation and to locate and appraise shallow mine workings.

Comment

The statement came days before yesterday's announcement of the first tranche of awards of new licences for exploration and production of onshore oil and gas as part of the 14th onshore licensing round.  Government's clear intention is to reduce the current uncertainty surrounding the outcome of planning applications associated with the use of hydraulic fracturing for shale gas exploration.

Onshore oil and gas trade association UKOOG has welcomed the changes to ensure that the "planning process itself is fit for purpose". 

The ministerial statement is to be taken into account in planning decisions and plan-making.  The statement sets out the national need for shale exploration as a complementary source to renewables and in addition to improvements in energy efficiency, and as part of the solution to meeting climate change targets by providing flexibility whilst driving down the use of coal. In this sense it is similar to the National Policy Statements which must be taken into consideration when considering consent for nationally significant infrastructure projects under the development consent order (DCO) regime established by the Planning Act 2008.

The Government could have gone further by making shale gas development a category of development eligible for the DCO regime. However, this would require changes to legislation and in any case the DCO regime, with a six month examination process, is not necessarily well suited to applications for relatively small exploration projects.

Operators of conventional onshore oil and gas operations which have in the past encountered little opposition to securing necessary planning consents have also been caught up in the heightened public opposition surrounding the use of hydraulic fracturing, with long delays to new consents required for relatively small changes to their established onshore operations. Whilst some aspects of the statement refer only to shale gas development, others apply more widely to applications for oil and gas developments, and none of the changes is confined to applications that involve the use of the technique of hydraulic fracturing.

We expect the changes will be portrayed by opponents as an attack on the concept of local democracy. However, the Government has clearly taken the view that within the boundaries of its existing powers under the planning regime, it must take action to buoy up a nascent industry whose prospects have suffered through recent local refusals.