Will David Cameron Make The UK An Energy Powerhouse?

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Michael Bastasch DCNF Managing Editor
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For years, political gridlock and environmentalist opposition have prevented natural gas drilling to move forward in the UK, but the massive conservative victory in the country’s recent election could make Britain a world energy player.

Tory Prime Minister David Cameron and his new conservative government have made developing the UK’s vast shale gas reserves a major priority in their bid to create a “Northern Powerhouse” of the island nation.

“We will continue to support the safe development of shale gas, and ensure that local communities share the proceeds through generous community benefit packages,” Conservatives politicians wrote in their 2015 platform.

“We will create a Sovereign Wealth Fund for the North of England, so that the shale gas resources of the North are used to invest in the future of the North,” the Tories added.

The “Powerhouse” agenda was crafted to allow cities in Northern England more control over their development, but part of that agenda is developing the region’s natural gas reserves sitting in the Bowland Shale formation. Developing shale in the north could drive 30 billion British pounds [$47 billion] in economic activity and create some 13,000 jobs, according to an industry study.

The news was welcomed by free market groups that favor energy production and more local control over economic affairs.

“We welcome the government’s determination to develop shale gas as a key plank of their ‘Northern Powerhouse’ agenda,” Lord Nigel Lawson of Blaby, chairman of the Global Warming Policy Forum (GWPF), said in a statement.

“The development of shale gas could in time create a whole new energy industry that would generate billions of much needed revenue,” Lawson said.

The British Geological Society estimates that the Bowland Shale contains some 37.6 trillion cubic meters of natural gas, making it the country’s largest shale formation. The UK has two other main shale formations, the Weald Basin in Southern England and the Midland Valley in Scotland.

Already, companies from all over the world have already diverted billions of British pounds in capital to Northern England to invest in the region’s development. But developing the region’s energy sources will still be an uphill battle because of the UK’s global warming law, long permitting delays at the local level and tough environmental opposition.

Conservative groups are now calling on Cameron’s government to ax the country’s 2008 global warming law that’s contributed to higher taxes and energy prices. UK Chancellor George Osborne, however, pledged in 2011 to cut continue to cut carbon dioxide emissions — though he said he would do it “no slower but also no faster than our fellow countries in Europe.”

But with a huge conservative victory in the recent elections, Osborne has a political opportunity to move forward on shale development. Osborne is a big supporter of the Northern Powerhouse plan, so shale could soon become a reality for the the British.

Shale development, however, could take some time to reach large production levels in the UK. A report by the UK’s Environmental Audit Committee said that shale would not be produced for another 10 to 15 years — but the committee’s report was decidedly anti-gas, so it should be taken with a grain of salt.

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