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Energy crisis: U-turn as Cuadrilla’s UK fracking wells given stay of execution by regulator

A regulator has withdrawn its demand that UK fracking firm Cuadrilla permanently seal its test wells, as the company makes a case for shale gas extraction to boost domestic energy security.

Cuadrilla had been facing down a June deadline to fill the two Preston New Road wells in Lancashire with concrete after the fracking process was effectively banned across the country.

But it submitted an application to have the order overturned on Monday, on the grounds that the two wells could help lift domestic gas production at a time of record prices because of Russia’s invasion of Ukraine threatening supplies.

Cuadrilla CEO Francis Egan said in a statement: “I would like to thank the prime minister and the business secretary for seeing the light and realising – just in time – how absurd it would have been to force us to pour concrete down Britain’s only two viable shale gas wells in the middle of an energy crisis.

“But this suspension will have a cul-de-sac ending unless we now reverse the moratorium preventing us from using the wells (and others like them) to get shale gas out of the ground and flowing into British households.”

The company said the wells would now be temporarily plugged and suspended until at least the end of June next year.

The North Sea Transition Authority (NSTA) said: “Cuadrilla applied for consent to keep its two Preston New Road wells and Elswick well on 28 March 2022.

The NSTA has looked carefully at this application, alongside recent developments, and agreed to withdraw the requirement to decommission the wells by the end of June.

“Cuadrilla now have until the end of June next year to evaluate options for the Preston New Road and Elswick sites.

“If no credible re-use plans are in place by then, the NSTA expects to reimpose decommissioning requirements.”

The UK relies on Russia for about 3% of its natural gas needs currently but faces stiff international competition for supplies as countries race to replace hugely depleted stocks in time for next winter.

To that end, the government is looking to North Sea producers to make up much of the shortfall as it struggles to agree a new, green-led, energy strategy including more nuclear and wind power to guarantee electricity supplies.

The North Sea boost was backed earlier this month by an energy market expert who told a committee of MPs the idea that supplies from Cuadrilla could have much of an impact was a “red herring”.

Nathan Piper, head of oil and gas research at Investec, made his remarks as the Treasury committee examines the surge in the cost of living being driven by surging energy costs globally.

The cost increases facing households and businesses will take a leap forwards on Friday when the energy price cap is lifted by an average annual amount of almost £700.

Industry research specialists Cornwall Insight predicted on Thursday that the 22 million homes covered by the cap face another increase just shy of £500 in October.

Labour described the regulator’s decision as “appalling” while a Greenpeace spokesperson said: “Trying to restart fracking now would only mean wasting more time when we have little.

“It will take many years to develop and if it ever gets produced, it will be sold to the highest bidder on the international market, with no impact on our energy bills.

“If the UK and Europe want to end their dependence on Russian gas, the quickest way to do that is by insulating homes, installing heat pumps and boosting renewables.”

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