Opponents of plans for 15 years of oil production near Scunthorpe had tears in their eyes when councillors refused planning permission this afternoon.
North Lincolnshire’s planning committee voted against the application at Egdon Resource’s Wressle site, despite a recommendation from officers to approve.
The result (six against, three in favour and one abstention) was greeted with cheers from a neighbouring room where most spectators had been required by the council to watch the meeting on a video link.
Immediately after the meeting, the reaction from Elizabeth Williams, a speaker against the application and member of Frack Free Lincs, was:
“It’s profound relief. I don’t know whether to laugh or cry. We have worked so intensively over the past six months”
Another speaker against the plans, Geraldine Clayton, said:
“I don’t know whether I can describe how I feel.”
Mark Abbott, managing director of Egdon Resources, the site operator, said:
“We need to take some time to consider our next steps.”
The vote came after councillors heard presentations from opponents and the company about techniques that would be used to stimulate the well and increase oil production.
They included a proppant squeeze, which involves pumping sand and gelled water under pressure into the well, and acidisation, where, in this case, diluted hydrochloric and hydrofluoric acid would be injected to improve oil flows.
Egdon stressed that these techniques were standard in conventional oil fields. But opponents said they were untried, untested and a form of hydraulic fracturing.
Several councillors said the proposed operations threatened a supply of groundwater used by British Steel at its nearby plant in Scunthorpe. In September last year, the council voted to promote the company and the meeting heard a statement of objection from the Unison union at the works.
A substitute member of the committee, Labour’s Len Foster told the committee:
“I do not think it is a risk we can take for our major employer. I will be objecting to this application.”
There were also repeated complaints by councillors that the Environment Agency could not be trusted to regulate the site.
Cllr Foster, said:
“I am fed up with them. There have been problems with flooding, with river water issues, and it’s never been their fault. They hedge their bets on every single occasion.”
But the crunch came when the Conservative ward councillor, Holly Mumby-Croft, said she had concerns about the application that had not been addressed in the officer’s report. She said:
“I cannot support this application”.
The committee voted against the plans on the grounds that there was insufficient information to allay fears about the risk of water contamination and damage to the environment and local economy.
After the meeting, Elizabeth Williams, of Frack Free Lincs, said:
“This result was beyond our wildest dreams – that the planning committee have listened and digested the information in front of them.
“This [application] is low volume high pressure hydraulic fracturing, not in shale, but in sandstone.
“We hope this decision will set a precedent in the rest of the county, especially at Markwells Wood in the South Downs, where there is a similar application.
“It is a brilliant decision for wild spaces, for work places and for the climate.”
Asked whether she expected the company to appeal, Ms Williams said:
“They usually do. The fight is not over.
“We go on to support everyone else across the county as they have supported us today.
“It is so heart-warming to see people coming to support us here from across the country.”
Chris Crean, Friends of the Earth regional campaigner in the East Midlands, said:
“This is a tremendous result for local people and fair play to the councillors for having the courage to turn down this application. This decision will be seen by many other local planning committees as a way that we can all stand up to this dirty industry.”
The council approved a second application by Egdon for groundwater monitoring boreholes at Wressle. This was a condition of the site’s environmental permit.
Disappointment for Egdon
In a written statement issued after the meeting, Mark Abbott said:
“We’re disappointed because we undertook a comprehensive consultation and addressed every concern raised by the community and other businesses to the satisfaction of the officers of the council who recommended both applications be approved.
“We’re pleased however that the application for boreholes to monitor groundwater onsite has been approved. We’ll review what has happened here today and think about our next steps.”
Later the statement was updated to include:
“Our business has been operating exploration and production sites in a safe and environmentally sensitive manner across the region for many years, engaging with communities, employing local people and investing in the local supply chain.
We will now take time to consider our options including our right to bring forward an appeal.”
Egdon and its partners had been counting on a go-ahead for oil production at Wressle. In its last annual report, Egdon predicted the well would generate a total of 500 barrels of oil per day, of which it would benefit from 125 barrels. This compares with Egdon’s total UK oil production of 177 barrels per day in 2015-2016.
One of the partners, Celtique Energie, said in its accounts published last year that its cash flow forecasts assumed revenues from Wressle. It warned:
“If there are delays in the development, the development is unsuccessful or production is less than forecast, the Group and/or Company may not have sufficient funds to repay shareholder loans or settle their liabilities as they fall due.”
A total of four companies have a stake in the Wressle project. Their shares are: Egdon (operator) 25%; Celtique Energie 33.3%; Europa 30%; Union Jack Oil 11.67%.
Hugh Mackay, chief executive of Europa, said this afternoon::
“At an anticipated gross rate of 500 bopd [barrels of oil equivalent per day], Wressle has the potential to generate meaningful revenues not just for the participating companies, but also for the government in the form of tax receipts. With this in mind, we will be exploring with our partners all options on how best to take these licences forward and further updates will be provided in due course.”
Egdon’s share price closed the day down 11.75% at 13.90p. Europa Oil & Gas (Holdings) Plc was down 14.58% at 5.12p and Union Jack Oil Plc down 26.11% at 0.13p.
Updated 12/01/2017 to include the revised statement from Egdon Resources