Since our last update (in August 2013) there have been a number of developments in relation to the permitting and consenting regime affecting onshore unconventional oil and gas in the UK.
The UK Government has proposed the following amendments to amend planning legislation and guidance in England:
- Notice requirements – Operators will not be required to notify planning applications to landowners under whose land directional drilling may take place. Owners of land on which surface operations are to be conducted would still require to be notified.
- Application form – A standard application form for onshore oil and gas planning applications will be introduced with a view to simplifying the application process. It will be compulsory for both operators and planning authorities to use the standard form which is intended to cover all phases of onshore oil and gas development.
- Application fees – The Government intends to issue revised guidance on planning application fees to clarify that planning fees in relation to applications for oil and gas exploration and development activities should be calculated solely on the basis of the area of surface works.
A copy of the proposals is available here.
At the Scottish National Party’s annual conference in October 2013, the Scottish Government announced plans to introduce “buffer zones” between oil and gas development sites and communities with the intention to minimise the impact of extraction on local communities.
The proposal is not new. It had already been incorporated into the Scottish Government’s draft planning policy. (The planning policy is guidance on how nationally important land use planning matters should be addressed by local authorities).
The draft policy states that “buffer zones” will have to be “adequate” taking into account the specific circumstances of individual proposals, including size, duration, location, method of working, topography, the likely environmental effects and proposed mitigation measures.
Other key points set out in the draft planning policy are:
- Policy principle – The planning system should recognise the continuing role of oil and gas in maintaining a diverse energy mix and improving energy security.
Local development plans – Local authorities' development plans should:
- ensure that workable resources are not sterilised by other development
- recognise the differences between exploration and appraisal and production activities and that production activities are likely to require a separate planning consent
- address constraints on production and processing and identify factors that will be taken into account in making planning decisions in relation to applications for wellheads and transportation infrastructure; and
- provide a consistent approach where licences extend across local authority boundaries.
- Development management – Proposals by operators should provide sufficient information to enable a full assessment of the likely effects of a development to be undertaken. They should include appropriate control, mitigation and monitoring measures and should demonstrate appropriate management of mining waste. Finally, local development plans should set out the issues to be addressed when assessing specific proposals, such as disturbance, disruption, potential pollution and the scale of the impact on local communities.
- Controlled impact of development – Proposals for extraction should be permitted if any significant impact on the amenity of local communities, natural heritage, historic environment or other economic sectors important to the local economy can be adequately controlled or mitigated. In considering planning applications, account should be taken of potential effects on neighbouring uses and directional drilling should be used wherever feasible. In addition, consideration should also be given to the transport of produced hydrocarbons by pipeline, rail or water rather than road where possible.
- Decommissioning – Decommissioning measures will need to be to a high standard, fully funded and undertaken at the earliest opportunity. Some form of security for decommissioning costs should be required in order to manage the operator's exposure to costs, recognise the landowner liability, ensure obligations pass to successors in title and ensure that restoration obligations are fully funded. Ensuring that operators' decommissioning obligations are met after operations have concluded is likely to be an important issue as more wells are drilled and we understand that DECC are currently considering this. Scottish planning authorities may be expected to be particularly sensitive to this issue given the recent insolvency of the Scottish Resources Group coal mining business (and the consequent abandonment of certain mining operations which require substantial remediation).
- Review of consents – Local authorities are encouraged to ensure that mineral permissions are reviewed every 15 years to take into account the most up-to-date operating and environmental standards.
Despite these requirements, on the whole the draft planning policy remains supportive of oil and gas operations. Responses to the Scottish Government’s consultation on the drafting planning policy are currently being analysed and considered. The final version of the policy is expected to be published in June 2014. A copy of the draft policy is available here.
Water abstraction in Scotland
The Water Resources (Scotland) Act 2013 was enacted earlier this year. Under Part 2 of that Act consent of the Scottish Government will be required for an abstraction of more than a specified amount of water from surface water or groundwater. The relevant amount is currently 10 mega litres per day, although this can be varied by the Scottish Government.
Part 2 of the Act has not yet been brought into force and there are currently no proposals to bring it into force. There are transitional provisions under which operations for which a CAR licence is already in place when Part 2 comes into force will not need Scottish Government consent.
If / when Part 2 of the Act comes into force, a Scottish Government consent may accordingly be required where an operator chooses to source to water for fracturing operations themselves from on-site resources rather than purchase water from a commercial provider. A consent may also be required for operations which involve the abstraction of groundwater in excess of the relevant amount from wells eg in dewatering for the purposes of coalbed methane extraction.
Any requirement to obtain the consent will be in addition to any requirement to obtain a CAR licence from the Scottish Environmental Protection Agency (SEPA) for any water abstraction (on which please see our June 2013 briefing note).
A copy of the Water Resources (Scotland) Act 2013 is available here.
MoU with the water industry
On 27 November Water UK (the representative body of the UK water industry) and the UK Onshore Operators Group (the representative body of UK onshore oil and gas operators) entered into a memorandum of understanding (MoU) in relation to the cooperation of their members.
The MoU sets out the basis upon which operators and water / waste water service providers should cooperate to identify issues and fine solutions to them, including:
- Baseline monitoring of operations to assess impacts on quality and quantity of local water resources.
- Operators' plans for exploration and production operations, and the long and short term impacts that this may have on the demand for water resources in the local area.
- Operators' plans in relation to site water management (including water reuse).
- The composition and options for disposal / treatment of flowback fluids.
The water industry is currently conducting research on the treatment of flowback fluids. It is also pressing the UK Government and the devolved administrations to require consultation with water service providers as part of the planning process for onshore oil and gas activities to ensure that they have an opportunity to engage at an early stage.
Further details on the MoU can be found here.