Questions over local benefit from Cuadrilla’s fracking fund

As ministers consider how to compensate people living near shale gas sites, a DrillOrDrop analysis of the UK’s only fracking community benefit fund raises questions about its value.

Most households who got direct payments from the scheme for Cuadrilla’s Lancashire fracking site received only £150, out of a total fund of nearly £0.25million.

None of the projects awarded grants from the fund could give details of how many people had benefitted.

Cuadrilla’s Preston New Road fracking site. Photo: Cuadrilla Resources

Between 2017 and 2019, Cuadrilla built a 7.34ha shale gas site at Preston New Road, near Blackpool, and drilled and partially fracked two horizontal wells. As a form of compensation, it made voluntary payments to the community.

The company has not responded to our questions about the payments. But we have examined financial records, local newsletters and meeting minutes. We also talked to people who distributed or received the money.

We’ve been told that Cuadrilla made payments totalling £40,000 for the two horizontal wells drilled at Preston New Road (£20,000 per well).

We were also told that the company paid a total of £200,000 when it fracked at the site in 2018 and 2019 (£100,000 for each fracked well).

Local grants

The £40,000 wells payment and the first £100,000 for fracking went into a fund operated by the Community Foundation for Lancashire and Merseyside, based in Liverpool.

The Foundation told us it gave grants totalling nearly £97,000 from the Cuadrilla fund to four local organisations.

To qualify, the projects should “benefit residents within Westby with Plumptons parish”. Priority was given to projects that helped to reduce social isolation and improve community cohesion or had a positive environmental impact.

DrillOrDrop contacted the four organisations that received grants to find out what they spent the money on.

St Anne’s RC Church at Westby had not yet spent its £12,000, a diocesan official told us. The money had been sought for pointing work to the listed building.

The church will decide at a meeting later this month whether to use the money or send it back.

The official said the Roman Catholic church did not invest in fossil fuels.

The Bishop of Salford, the lead on environmental issues for the Roman Catholic church, told BBC Radio Lancashire last month that the government should look again at its decision to lift the moratorium on fracking in England.

Just Good Friends, a community support group operating mainly in St Annes, received £17,400.

Its founder, Bev Sykes, told us she did not deal with grants and could not provide information on what the Cuadrilla money was used for. No trustees were available to talk to us, she said.

We contacted her again today but no one from the organisation has responded to our questions.

The AFC Fylde Foundation received £10,400. The organisation is linked to AFC Fylde football club, which Cuadrilla sponsored directly. An official from AFC Fylde Foundation said its management team changed two years ago. No one who had details of what the grant was spent on still worked there, he said.

The largest payment, of £57,196, went to the broadband provider, Boundless Networks Ltd.

A spokesperson for the company said today:

“This funding was used to build broadband infrastructure to support the local community within the Westby-with-Plumptons parish.

“Due to various delays in gaining approval for the transmitter sites a large part of the intended coverage area had its internet capability upgraded by Openreach so we never achieved the anticipated uptake from customers.

“We welcome any interest from within the Parish to get connected to our network and ask that enquiries are made via our website.”

Four other organisations applied for grants but were refused, the Foundation told us.

Almost £43,000 in the Preston New Road fund managed by the Foundation has not been spent, it said.

Direct payments to households

The second fracking payment of £100,000 was divided between households living within 1.5km of the site.

Cuadrilla reported that 29 households within 1km of the centre of the site would receive £2,070 each. This was an equal share of 60% of the £100,000 fund, the company said.

The remaining 259 households, living between 1km and 1.5km of the centre of the site, received £150 each. This was an equal share of 40% of the £100,000.

Not all the households who were entitled to these payments made a claim or cashed the cheque.

The Community Foundation told us that it had received a further £13,000 from the money set aside for direct payments for fracking the second well that had not been claimed by households.

“Payments don’t necessarily benefit residents most affected”

Susan Holliday, of Preston New Road Action Group, is one of the closest residents to Cuadrilla’s site. She told us:

“The business secretary has said that the companies should come up with packages that will make what they are proposing look attractive. The prime minister has said that there is need for local consent before fracking operations will take place.

“It seems to me that they are suggesting that compensation will be used as a tool to buy people’s consent.

“Cuadrilla used two methods of compensation; payment into a community fund and direct payments to local residents. However, there was still no community consent, as evidenced by the number of objections and challenges.

“Payment into a fund does not necessarily benefit the residents most affected by the site.

“Direct payments to residents close to the site will benefit from them to a certain extent, but this will not outweigh the risks. However, particularly in the current financial crisis, people may not be in a position to turn down any financial payments being offered to them, even if they object to fracking taking place in their community. In addition, people may accept the compensation on the basis that the outcome will be inevitable, so they may as well get some benefit.

“It is clear that the acceptance of financial benefits is not a measure of community consent. It is morally wrong that people should be forced to choose between their finances and their health and well-being.”

Government discussions on compensation

Ministers are reportedly backing a scheme that would give each household £1,000 to approve provisional fracking in their area – considerably more than paid out directly by Cuadrilla to most of the households within 1.5km.

If Cuadrilla had adopted this model, it could have spent more than £280,000 on direct payments.

Other schemes being considered are royalties for people who own land under fracking wells and a share of revenue for local residents.

So far, there has been no definition of how close to a fracking site you would need to live to receive any of these payments.

DrillOrDrop reported in July 2022 about the difficulties of gauging local support and deciding who should receive compensation.

There’s been no definite information from politicians since then.

We asked whether just the views of the most local residents should be considered and how do you define local.

We suggested that people living further away from a site may not receive any compensation but could be affected by deliveries if they were on a lorry route.

And the impacts of fracking could affect people living in a wider area. There were reports of damage to buildings across the Fylde region from the 2.9ML fracking-induced earthquake in August 2019 – so should they be compensated too?

23 replies »

  1. Susan Holliday is absolutely correct:

    ”It is morally wrong that people should be forced to choose between their finances and their health and well-being.”

    Numerous peer-reviewed papers confirm the adverse health impacts for residents living close to fracking.
    For example, a very recent study, by the prestigious Harvard University school of public health, reports children with at least one fracking well within 2km of their birth residence had twice the odds of developing Acute Lymphoblastic Leukaemia, in comparison with those with no fracking wells. Other recent studies document increased mortality in the frail and elderly, exacerbation of asthma, strokes, heart-attacks and heart-failure, premature and low birth weights, adverse birth outcomes including major congenital anomalies, severe neonatal morbidity and increased neonatal mortality, vasculitis, rashes, chronic rhino-sinusitis, migraine headaches, fatigue and increased anxiety and stress levels. Workers inhaling silica sand dust will also have an increased risk of silicosis (irreversible lung disease).

  2. Other Cuadrilla payments have gone to land owners.

    According to the land registry Cuadrilla Bowland Ltd paid just £8,000 land at Preese Hall farm.

    Considering all that went wrong at that site £8,000 may not seem that tempting to other land owners.

    Maybe they will be offering £8,000 to the land owner for the site and another £1,000 if they live close buy.

    A whopping life altering £9,000.

    • Well said, John. I think we knew at the time the landowners had been conned and exploited. In short they were abused and their experience must now be a matter of regret for them. They have alienated their community for a pittance.

    • Worth remembering that fracking wells have a short life span before new ones have to be drilled. Once they’ve been plugged and abandoned by good old fracking firm Bodgit and Scarper, the landowner will be responsible for any problems, leaking Methane etc. Eight grand isn’t going to cover much remediation. That’s why the big landowners of Ryedale are so opposed to fracking, along with the seismic and various other risks.

  3. Last time at PNR Cuadrilla made a single payment per household regardless of the numbers living there. The payments now proposed are presumably to count the number of residents who support fracking which would mean every person having their say and receiving a payment. With the proposed ideas, one house may contain one person another could house a family of several adults. Who decides whether or not to accept their 30 pieces of silver, one person or each individual? In the case of multiple person households , would each person receive the full payment or only one person and the rest get nothing even though each person would be forced to accept the certain level of increased risk and disturbance that Rees Mogg mentioned. What would be the situation if some people in the house supported fracking and others didn’t causing family and possibly neighbour division?
    This whole half baked plan is totally immoral. Where would it end? Will builders and developers now be allowed to go from door to door, handing out bribes to residents if they agree to a local housing estate or supermarket or a night club and thereby by pass the legal planning regulations? Unless we have now become a complete banana republic, paying cash for votes and the business involved being the judge and jury is still illegal

  4. The Community Foundation for Lancashire and Merseyside, based in Liverpool?

    That was the outfit that had pro-fracker Babs Murphy as a Trustee for Philanthropy Development.

    And AFC Fylde gets given 10k but they don’t have any details of what the grant was spent on? Aren’t they supposed to keep records of this kind of thing as a charity?


  5. I would suggest that any proposal put forward by potential operators will need to consider the reality of the individual location. Some sites will have more people living closer to the site than others, so the balance between support payments to the household versus the payments to the community, may not be identical across several sites.

    • The whole thing is incredibly badly thought out Fred.

      Is it paid to the householder or the individual affected?
      Do households with more residents get more money?
      Do those residents have to be 18? If so what about say a 17 year old who will be 18 by the time they get round to doing anything?
      Who gets paid if a house is rented? The landlord or the tenant?
      What happens if I have two or more pads within 1.5 miles? (Quite possible with 100 well pads in Cuadrilla’s PEDL)? Do I get multiple payments?
      As you say why should someone in a sparsely populated area get more money that someone who just happens to live next to a park home site with a hundred dwellings on it?
      Why would only those within 1.5 miles be consulted when the impacts of the 2.9Ml were felt up to 10 miles away?
      What use is £1000 when your house value is likely to depreciate by 10-20 times that?

      And before they get to think about these questions they have to get permission on a site by site basis, but as yet there are no sites with planning permission and they only know the location of a handful across the entire country, so how can they get consent from and pay people within 1.5 miles of a location that is not yet known.

      I look forward to Mr Rees-Mogg answering all of these questions.

      (Or not as they quietly U-turn on yet another stupid idea.)

    • MFC.

      You are no doubt aware that most of the households who experienced distress, disturbance and some damage – even if minor – to their property because of the Cuadrilla seismic stimulation were located on the coastal area rather than adjacent to the site. If you know how the compensation paid out by Cuadrilla can be broken down by location please let us know. We in St Annes and Lytham have every right to become indignant if we are to have this risk imposed on us again without our view being taken into account.

  6. Well, you are asking some questions reaction except I have yet to see any details, just suggestions, so I fail to see how it can be badly thought out. There have been some suggestions, some outlines but the details are awaited. The thinking still seems to be underway.

    I would imagine from what has been said there would be two proposals. One to cover exploration, with a fixed payment to “locals”, but maybe stepped according to locality. Second to cover production phase with a share of the revenue. Then a community fund additional to all of that.

    And old chap if you are lucky and Sir Jim buys into Cuadrilla you might even get one of his nice diesel guzzlers at a discount!

    As far as impacts felt 10 miles away, behave. I get impacts from airports 100 miles away. I am afraid your tendency to move from reason to attempts to muddy the water may be what is required in certain quarters but will not get too much attention within the thinking process.

  7. I” fail to see how it can be badly thought out.”

    Er because if it had been well thought out they’d be able to explain it to us now Fred. Come on!

    “I get impacts from airports 100 miles away.”

    You have truly jumped the shark 😉

  8. Why would they explain it to you, reaction? As I stated, the thinking still seems to be underway. Come on! Even when a firm proposal is ready, you may not be the first person on anyone’s list to be informed.

    I know the “leader” has to be first onto the beach, but when making that move whilst still out in deep water then floundering is inevitable. Perhaps just wait until a proposal is made?

    Flight paths, reaction. You have really lost touch with reality.

    • I said”us” Fred. Keep up old fellow.

      They can’t explain it to us (or anyone) because they have no idea how to do it, do they?

      I don’t expect a special explanation for myself but I do expect government to be at least semi- competent.

      I hadn’t realised you were a chemtrail conspiracy theorist! Still I’m not altogether surprised tbh.

      • Well, I think the reply to that is obfuscation, reaction.

        If that is how you approach information then you will be last in the queue and rightly so.

        In terms of explaining to anyone, maybe that will happen when there is a defined plan rather than suggestions? And when you have realized the common sense of that instead of attempting to manufacture a grievance you may then move on to realize flight paths create noise pollution to millions in the UK and elsewhere. Most of those millions just accept it as it is a consequence of how they wish to live their lives. But it still exists.

        • Good move: introduce another red herring, in this case flight paths, manoeuvre so that you can claim that pollution clearly caused by disturbance from flight paths is disputed, then mount your trusty steed, Rocinante, and tilt away at yet another windmill!

          Why not just concentrate on your mission: to justify and defend the indefensible continuing exploitation of fossil fuels? I wonder…..

        • Your replies usually are mostly obfuscation Fred. I’m glad you are admitting it.

          100 miles away from any airport most planes will be flying at about 40,000 feet and even someone as desperate to find an another issue to distract with as you would struggle to be irritated by their audible noise at ground level.

          You have made a bit of a fool of yourself again here Fred, and digging deeper isn’t really helping you.

          • Oh really, reaction?

            Strange that many are disturbed, but also interesting that many are not-in that they just get used to it! Perhaps you have made a bit of a fool of yourself suggesting that people may get used to impacts and disturbance. Being compensated for such impacts and disturbance may make getting used to it a little easier!

            • It may indeed, EA. But sugaring the pill is not acceptable if the pill won’t make you any better. It’s called a bribe, designed to persuade you to accept something morally suspect and definitely not in your best interests. It corrupts (with apologies to Portia) “him that gives and him that takes”.

            • Except I didn’t suggest that people may get used to impacts and disturbance. I pointed out that airplanes at 40k feet don’t really disturb anyone (except supersensitive people like you perhaps)

              Stop digging while your head is above ground Fred.

              PS Great resultsat LCC today and FBC last night eh?

  9. They won’t get support from around the PNR site. That means starting all over again. They need to have wells strategically placed for infrastructure connections so even if they got support for 1 site they wouldn’t know if that support would be there for the next one. After seeing what a mess 1 site makes the next in line would be unlikely to offer support. When Labour get in they will ban it anyway. Then there is the constant unknown of when the big seismic event comes along and shuts the industry down forever. A few mug punters will go with the hype but UK shale gas will never happen.

Add a comment

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s