UK to check fracking firms’ finances before approval

The UK Government is considering financial checks of companies proposing to carry out fracking before giving the go ahead for those projects. Energy Secretary Greg Clark said the financial resilience […]

By Priyanka Shrestha

The UK Government is considering financial checks of companies proposing to carry out fracking before giving the go ahead for those projects.

Energy Secretary Greg Clark said the financial resilience of firms should be carried out so stakeholders have confidence in their ability to meet commitments.

Third Energy has therefore not received consent yet to frack for shale gas at Kirby Misperton in North Yorkshire until those checks have been completed.

While Mr Clark said the company has passed 13 technical tests, he has asked the Oil and Gas Authority (OGA) to seek further financial information from the company, including the “required set of up-to-date accounts”, to inform his decision.

The Infrastructure and Projects Authority (IPA) has also been asked to assess the financial resilience of Third Energy, including its ability to fund decommissioning costs.

The energy secretary added: “The government considers that the financial resilience of a company wishing to hydraulically fracture is a relevant consideration. As a matter of policy, we will therefore look at the financial resilience of all companies wishing to carry out hydraulic fracturing operations alongside their application for hydraulic fracturing consent.”

Third Energy said its annual accounts are being finalised and it will be working with the IPA and OGA towards achieving consent from the government.