A NORTH-EAST chemical industry leader has backed Government plans to increase shale gas extraction, saying the process could support 74,000 jobs and significantly cut UK energy prices.
Dr Stan Higgins, chief executive of the North-East Process Industry Cluster (Nepic), says Chancellor George Osborne's proposals to change tax breaks and planning legislation would stave off cheap imported energy rivals and maintain the UK's chemical sector.
Dr Higgins was speaking after the Government revealed the UK's shale gas reserves were much higher than previously estimated, and pushed forward plans to put the country at the forefront of gas extraction.
Loading article content
The process, known as fracking, was stopped in 2011 after two earthquakes hit Preese Hall, near Blackpool, which were believed to have been caused by an energy firm drilling test wells.
However, the Government sanctioned the technique, which drills into rock and fractures it with high-pressure liquid to extract gas, to re-start in December, with Mr George Osborne earlier this year pledging tax allowances for companies to develop shale gas extraction.
Dr Higgins highlighted an Institute of Director's report, which he says shows up to a third of UK gas supplies could be delivered through shale gas by 2030, with the process supporting 74,000 jobs and cutting UK gas imports from £15.6bn to £7.5bn.
He said: “All industry is ultimately reliant on energy, especially the chemical industry, which underpins all other manufacturing.
“We supply materials and effects that other industries convert into things we build and use in our homes, cars, hospitals, schools and everyday life.
“Industrialists, particularly those in the process sector, are concerned about the security of UK gas supplies, especially in the winter, as the UK has to import most of what it uses, and the fact we are importing so much gas is a reason why we have been seeing increasing energy prices.”
Dr Higgins pointed to US shale gas extraction, where he says energy prices have fallen dramatically, and could lead to cheaper imports across Europe.
He said: “Hopefully the speedy implementation of shale gas extraction and related technology of underground coal gasification, are two ways the UK could counteract this and return to globally competitive energy pricing.”
Earlier this year, a Durham University study said fracking was not responsible for triggering earthquakes, revealing energy firms carrying out hydraulic fracturing to break down rocks have caused fewer recordable earthquakes than mining.