Alongside announcement of the new tax regime for unconventional gas, the recent Budget report referred to the work being undertaken by Department of Energy and Climate Change to produce planning guidance on shale gas exploration by July of this year.
Exploratory drilling for unconventional gas, including shale, currently involves a range of consents and licences under diverse statutory regimes. Wragge & Co's energy and planning experts look at the various requirements.
As the government holds the relevant mineral rights, and the power to licence them, those wishing to explore for shale gas will need to be the holder of a Petroleum Exploration and Development Licence (PEDL). The awarding of these licences has regard to the competence of the operator as well as the finance available to the developer.
The drilling operation will also require planning consent from the local minerals planning authority pursuant to the Town and County Planning Act 1990. This will involve the usual round of consultations, including in particular with the Environment Agency (which will advise on containment measures), and with the Health and Safety Executive (which will examine the safety precautions and integrity of the well).
Finally, before commencing drilling, the developer will require a Well Consent from DECC.
Developments associated with the exploitation of unconventional gas are not currently defined as nationally significant infrastructure projects (NSIPs) and are, therefore, subject to the normal planning regime.
The government has indicated that it is considering making the Nationally Significant Infrastructure Projects regime, established by the 2008 Planning Act, available to companies involved in large scale exploration for shale gas reserves. This would potentially allow a number of different statutory consents to be sought under one application to the Planning Inspectorate, as well as associated land rights.
The government will also be developing policies and guidance on the scope for local communities to share the benefits from shale gas exploitation in their area. Such measures have been developed for other energy-related developments, including on-shore wind and new nuclear new build and decommissioning.
Legislation has allowed such benefits to be taken in to account in the determination of planning applications. The benefits are delivered either through agreements under section 106 of the TCPA 1990 or under separate arrangements through powers contained in the Localism Act 2011 or the Energy Act 2004.