Fracking: Cameron Offers Councils Drill Money

By Becky Johnson, North of England Correspondent

Financial rewards worth £1.7m a year will be given to councils which give permission for fracking projects in their areas.

David Cameron said the Government was "going all out for shale" as he announced the move, which campaign groups opposed to the controversial method of extracting the gas from deep underground described as bribes.

The Prime Minister has declared that shale gas exploration is part of his long-term economic plan and says local authorities that allow drilling will receive 100% of the business rates collected from the scheme - double the current 50%.

Whitehall officials estimate that could be worth £1.7m extra a year for each site a council agrees.

Shale exploration firms will also pay out £100,000 when a test well is fracked and 1% of revenues, a deal which could in total be worth up to £10m.

Anti-fracking protesters at a rally at a driling site in Salford on Sunday

However, local community representatives say this is not enough in the face of the vast profits that stand to be made by the energy firms and the damage that would be caused to local areas.

Mr Cameron's announcement comes as the French energy giant Total has announced it will invest millions with a 40% interest in two shale gas exploration licences in the UK.

Mr Cameron said: "A key part of our long-term economic plan to secure Britain's future is to back businesses with better infrastructure.

"That's why we're going all out for shale. It will mean more jobs and opportunities for people, and economic security for our country."

The protest was against an exploratory drilling site known as Barton Moss

Jackie Anderson, a teacher who lives within a mile of an exploratory drilling site at Barton Moss near Salford, was on Sunday protesting about the effects of fracking on the community.

She told Sky News: "For the local residents it's got no benefit whatsoever. More and more the businesses and the councils are going to benefit because the incentives are going to them and we're getting none of the benefits at all."

Protesters at Barton Moss today handcuffed themselves to a lorry trying to enter the site.

A Local Government Association spokesman said: "Given the significant tax breaks being proposed to drive forward the development of shale gas and the impact drilling will have on local communities, these areas should not be short-changed by fracking schemes.

"One per cent of gross revenues distributed locally is not good enough; returns should be more in line with payments across the rest of the world and be set at 10%."

Protesters handcuff themselves to a lorry at Barton Moss

Hydraulic fracturing, commonly known as fracking, is a process that involves drilling thousands of feet down into the earth to create a narrow well. Water and chemicals are then pumped in at high pressure to create fractures in the rock. Gas then flows from the cracks and is captured.

Vanessa Vine, who founded the British Anti-Fracking Action Network, said: "Concerns of local residents range from everything from heavy traffic through villages, damage to the roads, right up to triggering of earthquakes and permanent, potentially permanent contamination of the groundwater, of the aquifer, of drinking water."

The Government estimates the industry could attract £3.7bn a year in investment and support 74,000 jobs.

Last year, a study by the British Geological Survey suggested there could be enough shale gas in the north of England to supply Britain for 40 years.

It is thought there may be as much as 1,300 trillion cubic feet at the Bowland site in Lancashire alone.

Vanessa Vine, founder of the British Anti-Fracking Action Network

Energy minister Michael Fallon said he expected between 20 and 40 wells to be drilled over the next couple of years but that it was as yet unclear whether it would provide "a really good reliable source of cheap energy".

"It is only right, when there is local growth and local jobs, that the councils are able to retain more of the business rates in order to help improve or maintain local services.

"I think that is only fair that local people should see some of the direct benefit."

Lawrence Carter, from Greenpeace, said: "This is a naked attempt by the government to bribe hard-pressed councils into accepting fracking in their area.

"Cameron is effectively telling councils to ignore the risks and threat of large-scale industrialisation in exchange for cold hard cash."

Shadow energy minister Tom Greatrex said: "Gas will remain an important part of our energy mix in the future, and if shale gas can replace our rapidly depleting North Sea reserves it could help improve our energy security.

"It is right that any communities that host nationally significant energy infrastructure are able to share in its rewards.

"But the Government must get its priorities right. Only by fully addressing legitimate environmental and safety concerns about fracking with robust regulation and comprehensive monitoring, will people have confidence that the exploration and possible extraction of shale gas is a safe and reliable source that can contribute to the UK's energy mix."

:: Watch Sky News live on television, on Sky channel 501, Virgin Media channel 602, Freeview channel 82 and Freesat channel 202.

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