Yesterday's UK budget announcement included a number of proposals which will affect the future development of unconventionals in the UK, including:

  • Community involvement - the UK Government's new Office for Unconventional Gas and Oil will review the way in which local communities can benefit from shale gas developments in their area, with proposals in this regard to be brought forward by the summer of 2013
  • Planning – there are plans to:
    • Produce technical planning guidance in respect of shale gas by July 2013
    • ensure that an effective planning system is in place, with guidance to follow which will seek to ensure that the multiple overlapping regulatory regimes within the UK are aligned
    • keep under review whether the largest shale projects should be able to apply to the major infrastructure regime, which could simplify and accelerate the development of particularly significant resources
  • Tax - introduce a new tax regime for shale gas (and, subject to consultation, possibly other unconventionals), involving a new field allowance for shale gas and an extension of the current ring fence expenditure supplement for shale gas to ten years (currently 6 years)

Further details on each of these various proposals will be issued by the UK Government in due course.