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Report (3rd Day)

Part of Infrastructure Bill [HL] – in the House of Lords at 7:45 pm on 10th November 2014.

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Photo of Lord Jenkin of Roding Lord Jenkin of Roding Conservative 7:45 pm, 10th November 2014

My Lords, when I saw the noble Lord’s amendment, my immediate reaction was to say, as he has done, “Look at what’s happened in other industries, notably the nuclear industry, and then look at what has been happening recently in relation to offshore oil and the measures that are now being taken there”. That led me to approach the trade association that covers the fracking industry, which was extremely helpful. My noble friend’s department has produced a very long paper of financial guidance on the whole question of petroleum licensing. At this hour of the night, when there is further business to come, I will not go into that in great detail, but the fact is that, having read that and the paper that has been produced by the trade association, UKOOG, I am satisfied that the difficulties that the noble Lord, Lord Whitty, has raised are in fact being addressed very positively. It is not only the question of whether the company that will get a licence will have the resources to carry out the work and continue to operate any shale gas well that it constructs. The papers address very specifically the questions that the noble Lord has made most of—the decommissioning of plant and financial liability if things go wrong. The existing regime provides for the remediation of environmental damage and contaminated land, and that includes water. If we take all the regulations together, if a company causes damage, harm or pollution to the environment, it can be required under the regimes in force to remediate the effects and prevent further damage, which is the same approach as applies to other industries.

Furthermore, the Government appear to have very clear powers: they can require financial evidence that there are resources available to pay for that. UKOOG has relieved my anxieties in that regard. Unlike the earlier industries to which the noble Lord, Lord Whitty, referred, the approach to this industry, which is still at a very early stage of its development, as he rightly said, has been extremely responsible. I shall be very interested to hear from my noble friend what those measures are. I am satisfied, but I will listen to my noble friend’s reply.