INEOS Shale announced today it has lodged a petition to challenge the Scottish Government’s decision to “effectively ban” onshore unconventional oil and gas extraction.
Opponents of fracking have described the news as predictable and desperate. The company was accused of “trying to keep alive its hope of ever making any money out of a toxic industry”. The Scottish Government said this afternoon the ban had been reached in “a careful and considered approach”.
Scotland’s Energy Minister, Paul Wheelhouse, announced on 3 October 2017 a new planning policy of no support for fracking in Scotland. This followed a two-year period of research and consultation. The decision was backed by the Scottish parliament on 24 October 2017.
Mr Wheelhouse said the Scottish Government had a moral responsibility to tackle climate change and an economic responsibility to prepare Scotland for new low carbon opportunities. He also said in the communities most likely to be affected by fracking there was no social licence.
At the time INEOS’s operations director, Tom Pickering (left), said the decision “beggars belief”.
This afternoon the company said it believed there were “very serious errors” in the Scottish Government decision-making process.
In a statement, INEOS said Scotland would miss out on economic and employment benefits that would be enjoyed in England. The company said local communities would not receive what it estimated wold be an estimated £1 billion from “a healthy shale industry”.
The statement quoted Mr Pickering as saying:
“The decision in October was a major blow to Scottish science and its engineering industry, as well as being financially costly to INEOS, other businesses and indeed the nation as a whole. It also removed at a stroke the potential for the country in these uncertain times to secure its own indigenous energy supply. We have serious concerns about the legitimacy of the ban and have therefore applied to the Court to ask that it review the competency of the decision to introduce it.”
INEOS also said in the statement that it any other shale gas operators in Scotland had, up to the moratorium announced in 2015 “invested millions over the best part of a decade in acquiring licences and obtaining planning permissions to construct drilling sites in discrete, safe locations.
“Such investment has been rendered worthless as a consequence of the ban, even in areas where no fracking was proposed. This despite the panel of scientific experts appointed by the Scottish Government concluding that shale development is capable of being managed safely”.
Mr Pickering said:
“If Scotland wants to continue to be considered as a serious place to do business, then it cannot simply remove the policy support that attracted that investment in the first place without proper procedures being followed and without the offer of appropriate financial compensation. In the light of these failings, INEOS has been left with no option other than to raise this legal challenge.”
“No social licence in affected areas”
In a public consultation on fracking in Scotland, more than 99% of the 60,000+ responses were objections.
In his announcement last year, Mr Wheelhouse said
“In those communities that would be most affected there is no social licence for unconventional oil and gas to be taken forward at this time.”
He also said he was concerned about the insufficient evidence on health impacts and he drew attention to the conclusion from KPMG that under its central scenario unconventional oil and gas could represent 0.1% of the Scottish GDP.
Scottish Government reaction
A spokesperson for the Scottish Government said this afternoon:
“We have taken a careful and considered approach to arriving at our preferred policy on unconventional oil and gas in Scotland.
“The Scottish Government’s position was endorsed by the Scottish Parliament in October, subject to completion of a strategic environmental assessment, and follows detailed assessment of the evidence and consultation with the public.”
“INEOS out of step with the public”
Scottish Labour, which opposes fracking, said:
“Ineos is out of step with the public and the Scottish Parliament when it comes to fracking. The people of Scotland don’t want it to happen and the Scottish Parliament has said that it’s not the right option for Scotland – not right for our communities, our water, our air and the future of our planet.
“But this legal action by Ineos suggests it may have received some kind of assurance from the Scottish Government before Labour pressure made the SNP agree that fracking should not take place in Scotland. We know that Ministers met with Ineos on a number of occasions, so now we need to know what was discussed.
“Scotland doesn’t need or want another fossil fuel – we can deliver alternative, sustainable jobs through proper investment in renewable energy and that is where Ineos should concentrate its resources.”
Ken Cronin, Chief Executive of UK Onshore Oil and Gas, said:
“When the Scottish Government announced last October that it would be supporting an indefinite moratorium on unconventional onshore oil and gas we commented that it was a poor decision, ignoring Scotland’s rich heritage and expertise in oil and gas. It was not based on the evidence from extensive independent research, which clearly stated that with appropriate regulatory oversight and monitoring Scotland’s regulatory framework is sufficiently robust to manage onshore exploration and production. Today INEOS has asked for this decision to be judicially reviewed, which we support.”
“INEOS decision reeks of desperation”
Friends of the Earth Scotland Head of Campaigns, Mary Church, said:
“INEOS’s legal challenge against the Scottish Government’s ban on fracking reeks of desperation from an industry that is failing to get results anywhere in Scotland, the UK or elsewhere in Europe. Wherever fracking has been proposed it has been strongly opposed by local communities and subject to serious delays and mounting costs.
“We are confident that the process to ban fracking was robust and fair, and the courts will find against INEOS. A two-year process looked at mountains of scientific evidence that spoke of the risks of the unconventional oil and gas industry to our environment, climate and people’s health.
“There is overwhelming support from communities on the frontline of this industry, people the length and breadth of Scotland, and almost all the parties at Holyrood for this ban. In challenging this ban INEOS are attempting to overturn a democratic process that engaged tens of thousands of people across the country and found that 99% were opposed to the dirty industry. Sadly, given the companies tactics south of the border it’s little surprise that INEOS are taking this course of action. INEOS are no doubt taking this challenge to keep alive their hope of ever making any money out of this toxic industry.”
“INEOS must accept they lost the democratic debate”
The Scottish Greens have described the decision as predictable and desperate.
Mark Ruskell MSP (above), the Scottish Greens’ climate and energy spokesperson, said:
“This is a predictable and desperate attempt by an industry sinking under public protest in England to try and salvage the last drop of commercial benefit in Scotland.
“Scotland doesn’t want or need fracking and Ineos should accept they lost the democratic debate in the Scottish Parliament, the evidence was there to ban fracking and that is what Holyrood has done.
“This isn’t the first time that big business has thrown their toys out of the pram when they don’t get their own way. This and the recent challenge on minimum pricing shows just how little corporations care for Scotland’s environmental and social wellbeing.”