Oil-drilling and fracking has until now been something that most people could safely ignore. But with much of the country now up for grabs by oil-exploration companies homeowners and buyers across England will soon have to be on the alert for drilling operations which could affect their homes.
The latest round of onshore licensing by the government has opened up almost the whole of England to exploration, as well as a further area of South Wales. The only significant areas not included are parts of East Anglia and the South Midlands, the far South-west, and Cumbria.
Onshore exploration licences have only been granted for a few areas mostly in northern England, but also in a number of areas in the South, especially on the Sussex/Surrey/Hampshire border, and in a limited area of South Wales. There has been a good deal of publicity about drilling operations in these areas, with reports of earthquakes in Blackpool and anti-fracking demonstrations at Balcombe.
New licensing round opens up prospect of fracking across much of England
Up until now gas and oil drilling has not been of much concern to property owners elsewhere in the country. But with the prospect of licences being granted for exploration across the rest of the country owners and buyers (not to mention their solicitors) will have to take much more notice of what is going on.
The concern for property-owners is that modern techniques enable drilling to take place horizontally from the bottom of a deep vertical shaft. Such horizontal bores can be drilled for several kilometres. So a property some distance from a drilling site can still be affected by underground drilling operations running beneath the property.
At present only exploration licences will be granted. Such licences provide the first step to starting drilling – but do not give absolute agreement to drill. Any further drilling application will then require planning permission, as well as permits from the Environment Agency and sign-off from the Health and Safety Executive.
However given the government’s apparent commitment to developing onshore oil reserves it looks likely that if companies discover workable deposits they will then be granted further extraction licences.
Oil present in shale deposits will be extracted by means of the process known as fracking – or hydraulic fracturing. A mixture of water and chemicals is pumped into the borehole at very high pressure causing the adjacent rock to fracture. This in turn releases the hydrocarbon molecules trapped in the rock which can then be pumped to the surface.
Landowners will not be able to get rich quick if oil is discovered beneath their property. All petroleum (i.e. mineral oil or hydrocarbons and natural gas ‘existing in its natural condition in strata’) was nationalised as long ago as 1934, and now belongs to the Crown. Drilling companies would have to pay if they want to lease land for a drilling site but the sums involved are unlikely to be substantial.
New planning rules may protect National Parks but not ordinary homes
Ministers have been keen to emphasise that additional planning requirements will apply for applications to carry out drilling in National Parks, the Broads, Areas of Outstanding
Natural Beauty and World Heritage Sites (although drilling in these areas is not totally out of the question.)
But ordinary homeowners will not be so protected. Instead the government is amending planning regulations to streamline notification requirements by drilling companies and speed up the determination of planning applications.
Planning guidance to local authorities on oil and gas development has also been updated “to provide clarity on the role of the planning system” and a streamlined application form has been introduced “to ensure less onerous requirements on the industry.”
No doubt the government wants to see planning applications for drilling to be steamrollered through quickly with as little publicity as possible.
Checking whether your home could be affected by fracking
Anyone buying a home should be concerned about the possibility of drilling and fracking being carried on which could affect the property. Even if buyers consider that fracking is safe they might be concerned about the possibility of anti-fracking demonstrations taking place nearby and disturbing their enjoyment of the property.
When the new licences are granted buyers should therefore make sure that they have got all the relevant information before proceeding.
This can be done by having environmental and planning searches carried out by their solicitor which would reveal the existence of planning consents and applications as well as known drilling sites. However such searches would normally only cover a limited area surrounding the property so it is likely that additional searches may also have to be made.
In the past coal-mining was the country’s major extractive industry. Mining areas were well-known and solicitors could easily make a mining search for anyone buying a house in such an area. But the extent of onshore shale oil reserves is at present unknown and until more is known it will be difficult to predict what effect drilling operations will have on the property market.