Legal

High Court dismisses challenge to government extension of gas exploration licence

RoyalCourtsOfJustice

Photo: DrillOrDrop

A judge at the High Court has dismissed a case that the government acted unlawfully when it extended a licence to explore for gas in Cheshire.

ben-deanMr Justice Holgate ruled against the challenge, brought by anti-fracking campaigner, Ben Dean.

Mr Dean (left) had argued that the then Energy Secretary had no power in 2016 to extend the initial term of a Petroleum Exploration and Development Licence (PEDL) held by IGas.

At a judicial review hearing in June, he asked the court to quash the extension (DrillOrDrop report). If his case had been successful, there could have been implications for another 10 licences similarly extended at the same time.

But in a reserved ruling handed down yesterday, the judge accepted the government’s case and awarded costs of £5,000 against Mr Dean

Mr Dean said this afternoon he was disappointed by the ruling. He said his legal team would be examining the judgement in detail before deciding whether to seek leave to appeal.

Licence or contract?

pedl189

Map: UKOGL

The case centred on PEDL189, which covers the eastern half of the city of Chester, nearby Tarvin, where Mr Dean lives, and other villages including Mickle Trafford and Guilden Sutton.

The area included the IGas coal bed methane site of Dutton’s Lane, at Upton, where the company evicted a protest camp in 2016, before abandoned its drilling plans.

The PEDL was issued in 2008 to Dart Energy (West of England) Ltd, later taken over by IGas. Under the conditions of the licence, the initial term for exploration should have ended after five years in 2013. But the government extended the initial term for another three years to give the company more time to carry out an agreed exploration programme. A further two years were added in June  2016.

Mr Dean, represented by David Wolfe QC, argued that a PEDL was a statutory licence, governed by the 1998 Petroleum Act. The Secretary of State had power to vary conditions only in specific circumstances, he said. The conditions at the time did not allow for a variation to the length of the initial term, so the Secretary of State had no right to make the extension and had acted unlawfully.

He said the licence application made it clear that where companies did not complete the work by the end of the initial term they would lose the licence. The idea that the licence could be extended by a private agreement undermined the EU hydrocarbon licensing directive, which governed the application process.

The government, represented at the June hearing by Richard Palmer, argued that it was well-known in the industry that the duration of an initial term could be extended. This allowed flexibility where a licence-holder could not complete work for reasons beyond its control.

Ruling

In ruling against Mr Dean, Mr Justice Holgate accepted Secretary of State’s argument that the PEDL was a contract and the terms could be varied by agreement between the parties, like any other contract.

He concluded that a PEDL licence was not governed entirely by the statutory code.

“Rather it is a grant of exclusive rights to search for, bore and get petroleum, in other words a grant of exclusive property rights, which contains the normal incidents of property ownership, in so far as they are not excluded or modified by the terms of the legislation or the relevant licence.

“Those rights include the right to assign the interest created by the licence and the ability of the parties to the licence to agree to vary its terms.

“Neither the legislation to which the Court has been referred, nor the terms of PEDL 189, prohibited the variation which was made by the deed dated 28 June 2016.

“For all these reasons, that variation was lawful.

“I reject the various grounds upon which the Claimant has contended that the deed of variation executed on 28 June 2016 was ultra vires and so the application for judicial review is dismissed.”

Friends of the Earth

Mr Dean’s case was supported by Friends of the Earth. Its lawyer, William Rundle, said today:

“We are hugely disappointed that Ben Dean has lost his case and the threat of fracking still hangs over his community in Cheshire.

“We will be discussing with Ben and his barrister any appeal and will continue to support him at this time.

“But whatever happens, the fight against risky and unnecessary fracking will continue, both in Cheshire and in communities across the country.

“This includes holding government to account when they act unlawfully, as we believed that they did here, because of how they managed this operator’s licence”.

Link to the court papers

DrillOrDrop report of the judicial review hearing

50 replies »

  1. Very predictable, but still interesting as it indicates that attempts to delay a licence-holder completing work will be unsuccessful as the period can then be extended.

    All very logical, but wait for the howls of outrage.

  2. Is the Law really an Ass?……..What then precisely is the point of issuing PEDL licences to self-regulating industries if they are not completely covered by the statutory code?………..the words ‘tail,’ ‘wagging’ and ‘dog’ spring to mind…………perhaps ushering in three more words into the equation………like ‘facilitating,’ ‘overt,’ and ‘corporatism’……..

  3. ron-I understand your howls, but that’s what comes of hiring a Wolfe. Is it him, or is it that you are barking up the wrong tree? Could he be a sheep in Wolfe’s clothing? Seriously, does he ever win? I hope he doesn’t play poker.

    No Nick-FOE LTD shake their tins and some gullible twerps come up with £5k. Will reduce the income to the tattoo parlours, so not sure whether a good or bad outcome.

    What I do find quite amusing is that these continuous attempts to utilise the legal process by the antis continue to fail, but more importantly, continue to create legal precedent against them.

    • Well Martin it looks like Ben got his 5k crowd funded in one evening – I put in the cost of a mediocre bottle of Syrah myself.

      I suppose that ,as we had the shadow justice minister protesting at PNR yesterday, fracking’s days in the UK are obviously numbered (just one more election it seems) but the legal challenges are still interesting nonetheless.

      It’s funny though that all the time the government is changing legislation and getting apparently perverse interpretations of points of law the support for fracking continues to circle the bowl. I wonder if the two things could be connected in any way?

      • The only thing that is “obvious” Refracktion, is that you have lost. Keep crying. Keep funding. Keeping waving signs and inspecting wheels. It keeps you from doing more harm.

  4. “The government, represented at the June hearing by Richard Palmer, argued that it was well-known in the industry that the duration of an initial term could be extended. This allowed flexibility where a licence-holder could not complete work for reasons beyond its control.”

    This is an important point, and undermines the anti-frack tactic of some who impede licence holders to drill, e.g by lock-ins, vandalism, etc.

  5. Keep dreaming refracktion! The Shadow Justice Minister is as irrelevant to what happens in this country, as the other protestors at PNR are.
    Meanwhile, the rig is there, drilling about to start. Maybe they will find nothing of any consequence (it happens) but maybe they will find something of real economic value. I know your continuous posts will not accept this could actually happen, but if it does, there will be a large number of people (including Shadow Justice Ministers) who will look complete twerps, having attempted to block the two thirds who are not against fracking. Five years of that and a withering of the “loaned” Remoaner vote and they will disappear into obscurity,(apart from an odd blog), as most anti democratic groups do in this country. Certainly no way to win an election, or any other campaign.

    Meanwhile, the latest court case reinforces the legal position for the exploration companies at the cost of the antis. All positive, apart from Mr.Wolfe’s reputation. Could you not try to find him a case he could actually win? The guy will be getting a complex about it.

    • Martin – I’m glad you’ve obviously been keeping your eyes open these last few years – the warnings have been here for a while https://drillordrop.com/2016/09/13/fylde-doesnt-look-promising-for-fracking-veteran-us-geologist/ and at the end of this article https://www.theguardian.com/environment/2017/jul/05/inquiry-fracking-blackpool-tremors, and of course we all remember Poland.

      The question I guess is which bites the speculators first – will it be the geology, the public opposition, political opposition and a change of government or the questionable economics, or will it be a bit of all of them?

      • Sure, Refracktion. They said that fracking wouldn’t work in the US thirty years ago – that it would not be commercially viable. They said we would never successfully frack for oil. The doubters have been wrong far more often than right.

        One thing is for certain, we won’t know how viable UK shale gas is until we get drilling. But the fact that it has proven viable 200 plus times, and production techniques have only improved since then, gives investors reason for optimism. So do many other characteristics unique to the Bowland.

        Best of luck!

    • Good points, Martin. Also note that regardless of what Cuadrilla extract, the anti-frack mob loses when the public realizes that just as in the other 200 fracking sites in the UK, none of the awful consequences the anti’s predicted have occurred. Lancashire doesn’t split off from the rest of the country and fall into the ocean. The people of Lancs don’t die. The birds still sing. The well is hardly noticeable. The water runs as clean as ever. This is a nightmare scenario for a campaign built on lies and hyperbole.

      • Haha – you do know they haven’t started fracking at PNR don’t you? Shall we do the DECC pointing out that modern MHVF is not comparable with the limited previous UK fracking again or are we all bored with that one by now?

        This is certainly a nightmare scenario for a campaign built on lies and hyperbole, but the campaign concerned is Cuadrilla’s PR campaign.

        • Would you remind me of the physical mechanism that makes hvhf so much more dangerous than that which was previously undertaken in the UK, Refracktion? Cat got your tongue? ;O)

          If the previous form of fracking was undertaken safely, and you can demonstrate why it was so much less dangerous, are you advocating for moving fracking forward using dated technology?

          [Edited by moderator]

          • Peeny. Yawn. Why do we have to go over the same old ground time after time. Go back to where I explained it all to you in simple terms last time you asked the same inane question for the Nth time. I am not going to spoon feed you the same material endlessly. Do some work yourself.

            [Edited by moderator]

            • Peeny – in other words you can’t be bothered to retrace the answers you’ve been given every time you try the same tired old time wasting questions. Why do you keep reappearing under different names?

  6. I suspect the “speculators” have looked at all your negatives and their assessment is they are invalid, or at best/worse, not serious risks.

    Risk analyses is always part of the process and is factored in, but so are the possible rewards.

    Warnings have been there for many years reference diesel cars as well refracktion. Some decide to ignore those, calculating the fuel efficiency will put money in their pockets and ignore the risks to the rest of the population and then find they will not be allowed to continue down that road as the costs of their actions are passed back to them. Keep away from that Shadow Justice Minister-there may be more restrictive plans afoot!

  7. I think mathematically my figures were not only more accurate, but more meaningful to any but the antis, Sherwulfe. But that’s okay, as it seems there is now a comfort zone where the antis are happy just to talk amongst themselves and any attempts at communication outside of that are a mixture of false science, fake news, scaremongering and now on to a parody of Bernard Cribbens.
    Surprised there are antis about today-thought they would be down at Portsmouth giggling to the throng with multiple Titanic references.

    • Martin – please explain how your ” the two thirds who are not against fracking” is somehow more meaningful or accurate than a breakdown of the most recent BEIS figures that Sherwulfe gave us. I can’t wait to hear why you believe this.

      It seems there is now a comfort zone where the pros are happy just to talk amongst themselves and any attempts at communication outside of that are a mixture of false science, fake news, scaremongering and hyperbole. (Oh and a liberal dose of wishful thinking of course)

      Bernard Cribbens? Wasn’t he the one who sang

      “Don’t dig it there, dig it elsewhere.
      You’re digging it round and it ought to be square.
      The shape of it’s wrong, it’s much too long,
      And you can’t put a hole where a hole don’t belong.” ?

      How very appropriate LOL

  8. Yes, Bernard sang about a guy digging a hole whose job it was to dig a hole, with a load of amateur onlookers telling him how it should or should not be done, not knowing what they were talking about. Sounds familiar and yes very appropriate. A little knowledge is a dangerous thing.

    The two thirds is more appropriate refracktion as anyone without an agenda looking at those results will view it in that way. They will see readily, one third is against it, and then review the views of the others to see if they are against it, but in a different way, then they will easily see that the two thirds are not against fracking-I have tried the exercise, and that’s how it comes out in the real world. I know in your world it is taboo to admit the data shows two thirds of those surveyed are not against fracking, but then two thirds do not inhabit that world and will look at it willing to admit that is what it shows. Then, you would tell the two thirds there will be no economic benefit to them, so they should change their minds-well, bad news. They will turn around and say we will wait and see and then take a more firm view-and this is the reason you are desperate to stop that being the next stage, but unfortunately for you many of the two thirds have already seen good evidence for them to make that judgement, not least, at the petrol (or diesel) pumps.

    • Martin – in my world, which is quite a logical one, I can entertain the two notions simultaneously that:

      84 % do not support fracking
      67 % do not oppose fracking

      That’s because I know and understand the results of the BEIS wave polling and the way the data is broken down.

      I can also understand the way in which what little support there is seems to be crumbling.

      It’s not terribly challenging stuff Martin. Keep working on it.

  9. It is challenging to some refracktion, but certainly not to me. I have commissioned a number of similar surveys, having helped a company produce an appropriate design, and then sat down afterwards and reviewed the data collected and what it indicates. It is what I was trained to do and paid to do. So, if some self interest group suggested to me that fracking should be banned, referencing this data, (which is your objective, so that is the way to look at it) my response would be sorry, you are a long way short of a majority for that to be considered. I would also suggest that the data is likely to swing further against that wish if/when the audience being questioned is provided with financial benefit information-because there are hundreds of similar surveys that would indicate that. In fact, it really could be added into this survey now, with a range of values, for the responders to indicate at what point they may firm/change their opinions. With disposable income stagnant, I would suspect there would need to be very little positive value to achieve a large swing. But, you suspect all of this, hence the smokescreens.

    But glad you understand it refracktion. Just add it to the other expertise you possess and you will be able to host a large number of dinner parties centred around the aubergine dazzling with knowledge-but please leave the wine choice to someone else, and better keep the old motor hidden away. Some people look through smokescreens.

    • Martin all that puffing and huffing is all very well but the inescapable point is that over the course of less than 4 years (during which time people have been promised various bribes in an apparently futile attempt to buy public opinion) opposition to fracking has increased from 21% to 33% while support has fallen from 27% to 16%. Even you must be able to see the writing on this particular wall surely?

      I’ll leave the wine choice to that wonderful Sainsbury’s Pocket Food and Wine Guide (now sadly out of print I think) written by Charles Metcalfe and Katherine McWhirter who are as eloquent and knowledgeable on wine as they are on fracking. They even know that syrah and shiraz are the same grape, so even you could learn something from them Martin.

      The old motor is not hidden away – it is a valuable and potent symbol of the ridiculous confusion of successive government’s approach to climate change and the need for informed and forward looking policy making. It is interesting that it took the exposure of a complete failure of a regulatory system to expose this isn’t it? They probably claimed it was gold standard as well.

    • Martin, I’ve just realised the reason I type so fast, is that I have eleven fingers! On my right hand there is one, two, three four, FIVE; then on my left hand I have ten, nine, eight, seven, SIX. So five and six equals eleven. That’s MC ‘stats’ for you!

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