Opposition

Study predicts fracking will not hit Fylde house prices but campaigners question research and findings

Research published today suggests Cuadrilla’s plans to frack in the Fylde would not affect house prices. But opponents of fracking have criticised the quality of the research and its conclusions.

The study, commissioned by the pro-fracking North West Energy Task Force and dated March 2015, compared house sales around Cuadrilla’s onshore gas sites at Preese Hall and Elswick in Fylde with the rest of Lancashire and north-west England.

It concluded there was “no clear evidence that drilling at either site had an impact on property prices”.

The finding was welcomed by Cuadrilla, which is applying for planning permission to frack up to eight wells across two sites in the Fylde, at Roseacre Wood, near Elswick, and at Preston New Road. A decision on the applications is expected by the end of the month.

The study authors, the property consultancy, JLL, had planned to analyse house sales within 1.5 miles of Preese Hall and Elswick. But at Preese Hall, 48% of households in the search area were privately renting and the sample size of sales was too small to be representative. At Elswick the number of annual transactions was also regarded as too small. The search area was extended to a three mile radius of both sites and, as a result, included Poulton-le-Fyle, parts of Blackpool and the edge of Preston.

Study search areas

Study search areas

The Preese Hall research covered the period from 1995-2014. Cuadrilla applied to frack at Preese Hall in July 2009, permission was granted in May 2010 and work started in March 2011. Operations were suspended in May 2011 after a series of small earthquakes, later ascribed to fracking.

The report found that the Preese Hall area had seen higher house price growth than Lancashire and north-west England over the whole period. But Preese Hall saw a larger decline in houses prices between the submission of the application and the start of work. The area saw a 7.5% price rise between the start of operations in 2011 and 2014. This compared with a fall of 4.2% in Lancashire and an increase of 0.2% in north-west England.

The application to drill at Elswick was submitted in November 1992, granted in January 1993 and work started in June that year. JJL said land registry data was not available until 1995 and it adjusted the figures for this area to remove high-value sales. It said prices rose 221% within three miles of Elswick from 1995-2007, compared with 130% for Lancashire and 155% for north-west England. After the peak in 2007, prices at Elswick fell 2.5%, compared with 19.9% in Lancashire and 17.9% across north-west England.

No high volume hydraulic fracturing was carried out at Elswick, although it was at Preese Hall and is planned at Preston New Road and Roseacre Wood. Cuadrilla was censured by the Advertising Standards Authority in 2013 for suggesting there was no material difference between the Elswick operation and its future fracking plans.

The North West Energy Task Force said: “Anti-shale activists frequently claim hydraulic fracturing activities damage local house prices. JLL’s analysis of the Land Registry data reveals the falsity of such claims. JLL’s findings reveal the actual impact of shale gas extraction on house prices and dispels a number of myths. It is a valuable contribution to serious discussion about how Lancashire can responsibly develop its shale gas resources.”

But opponents of Cuadrilla’s plans in Fylde have criticised the report. Bob Dennett, of Frack Free Lancashire and Green Party parliamentary election candidate,quoted by the Blackpool Gazette, said he had been told uncertainty about shale gas drilling would reduce the value of his house when he put it on the market.

He said: “Fracking isn’t actually operating (where the research is focussed). The well in Elswick was not fracked using the same technology.”

Another campaigner, Alan Tootill, described the report as worthless. By widening the search to three miles of the sites, he said, “they were therefore looking at house prices in Poulton and part of Blackpool itself and not the rural area around Preese Hall. The survey is worthless and there is no relevance at all to the situation at Preston New Road and Roseacre Wood.”

He added that the removal of high-value sales from the analysis “probably resulted in Kirkham properties figuring more than rural property. Also there is overlap between the two areas for which data was analysed, leading to the possibility of the same data being used twice.”

Barbara Richardson, of the anti-fracking Roseacre Awareness Group, questioned the validity of the findings because there had been no high-volume fracking at Preese Hall since the earthquakes in 2011. She said: “We have got written evidence in Roseacre of house sales falling through because of concerns about fracking”.

  • The research examined annual transactions ranging in number from 91-258 for Elswick and 312-832 for Preese Hall. It compared them with those for Lancashire, (12,756-32,350 per year) and north-west England (66,525-163,547 per year).

Link to report

2 replies »

  1. However poor the methodology it is no worse than the vague information used to proclaim that fracking would cause house prices to drop. In my view that information was much more tenuous, but still widely used to scaremonger.

    • According to the EIA:
      “Rigs needed for flat production
      Having estimated the Legacy Production Change or expected month to month decline in production in the absence of any new wells in the play, and Initial Production per Rig, one can calculate how many rigs would be required to bring on the equivalent amount of new production as the decline.”

      For good reason shale gas production often is described as being like trying to run up a down escalator.

      The EIA highlights the same issue also in the following way:

      “In any given month, there are new wells and legacy, or continuing, wells. Production from legacy wells declines over time, but recently the rate of decline in some regions has been increasing. This means that, in order for overall production to increase, operators must drill enough new wells to overcome the decline from legacy wells. As fewer wells are drilled, this decline becomes a significant challenge to overcome.”

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