– Farmers fear fracking could spell financial ruin (Telegraph, Oct 6, 2014):
National Farmers’ Union wants assurances farmers will be compensated if fracking reduces the value of their land, and accuses ministers of brushing aside their fears
Farmers fear they could face financial ruin from government plans to allow fracking beneath their land without compensation, the National Farmers’ Union has warned.
Ministers pushing for shale gas exploration cannot take the support of rural communities for granted and are turning farmers against the process by appearing to brush side their concerns, it warned.
The Government is pressing ahead with new laws that would strip people of power to block fracking beneath their property or land. It has insisted no compensation will be paid to individual home and landowners, because they should not be affected by the gas or oil extraction deep beneath them.
But the NFU, which represents 47,000 farm businesses across England and Wales, said its members feared that the value of their land above fracking sites could be reduced “because of current attitudes and perceptions of fracking” – even if no harm was actually caused.
This could have serious consequences for farmers, especially those with mortgages secured to their land – for whom “any reduction in the value of the land could have significant financial implications”.
Farmers were also concerned that supermarkets might cease to buy produce grown above fracking sites, Dr Jonathan Scurlock, the NFU’s chief adviser on renewable energy and climate change, said. The group is seeking assurances that landowners will be protected against any such possible indirect impacts of fracking.
He said farmers had initially seen fracking as a potential opportunity to make money, but were now “broadly concerned”. “Some of that is a consequence of the appearance that government and industry are trying to brush rural economy concerns under the carpet,” he said.
He said the recent decision by the Government to heavily redact an official report into the potential impacts of fracking on the rural economy had been a “public relations disaster”.
“I don’t think anyone can take support of agriculture and the rural economy for granted,” he warned.
The NFU accepts that laws need to be reformed to make it easier for companies to gain access, but not in a way that is “to the detriment of landowners”.
Under the plans currently going through Parliament, voluntary payments would be made to local community groups to compensate for underground access.
Dr Scurlock said the NFU was not satisfied with the plans and there was no reason why landowners should not get individual payments – which are not expected to be substantial – especially as fracking in open countryside would probably only require the companies to deal with a few landowners.
“If the approach chosen by government and the shale gas industry is only to negotiate with some nebulous community body, which certainly doesn’t guarantee landowners will get any kind of payment for giving up access under their land, that does just look like landowner interests being brushed aside,” he said.
The NFU is understood to be meeting Matthew Hancock, the energy minister in charge of fracking, as soon as Monday to discuss the issue after being disappointed that the Government failed to address the concerns, which were set out in its response to a consultation on the issue.
The NFU’s response also reveals concerns about other aspects of fracking including its safety. It challenged the Government’s assertion that there was only a negligible risk of water contamination, pointing out that “no drilling has taken place in the UK to be able to prove this”
Ken Cronin, chief executive of fracking trade body UKOOG, said there was “no known correlation between diminution of land value and any existing sites” of oil and gas drilling in the UK. “Farmers should be assured there should be no diminution in the value of their land because this is a heavily regulated industry,” he said.
A spokesman for the Department of Energy and Climate Change said: “Whilst the shale gas industry in Britain is in its infancy, extensive research confirms that we – in the UK – have the right regulations in place to ensure that drilling so far underground has no negative impact on the surface. In fact, many other industries already have access to lay cables and build infrastructure, such as water pipes and tunnels.
“Of over half a century of oil and gas production in the UK, there has been no evidence that house prices have been impacted and there should be reason for this to change for shale gas.”
One shale gas company, Ineos, has broken ranks with the community pledges made by rest of the industry and pledged 4pc of revenues to landowners above fracking sites,
The DECC spokesman said Ineos’s proposals “have the potential to be a huge boost to the farming community”.