Fracking and below ground property rights

The UK government has just announced (Monday 28th July) that the on-shore search for frackable oil and gas is to be extended to all areas of Britain, but the national parks and areas of outstanding natural beauty (AONB) will be excluded unless there are “exceptional circumstances” (unspecified).  With the exception of the South Downs area of southern England, the most likely gas-bearing shale deposits indicated by the British Geological Survey include the former coalfields areas of the Midlands, North West and North East England, South Yorkshire and the lowlands of Scotland.

This is hardly surprising: deposits of coal are usually associated with methane – “fire damp”.  Estimates in the Royal Society 2012 study[1] put the technically recoverable gas deposits at around 20 trillion cubic feet at atmospheric pressure, of which maybe 10% would be economically extractable[2].  In terms of energy equivalence, 2 trillion cubic feet of methane corresponds to about 50 million tonnes of oil equivalent (Mtoes).  This is about 60% of Britain’s annual consumption (85 Mtoes) or about 1.5 times current annual production (33 Mtoes), and would make a useful, but quite modest contribution to reducing Britain’s huge balance of payments deficit (say £2 billion per annum for 12 years).

The article by Matthew Lynn in the Daily Telegraph (29th July) extolling shale as potentially a “huge bonanza” is wildly adrift on the figures he gives.  Ten percent of the 1.3 trillion cubic feet Lynn quotes as extractable, would provide Britain’s gas needs for about 2 weeks, not 50 years.  Clearly commercial firms have to be interested in much bigger deposits than this.  Cuadrilla[3], a UK company focussed on exploration and production, estimates that “at least” 200 trillion cubic feet are trapped in Lancashire shale.

Nonetheless, Lynn raised an important point about ownership of mineral rights under people’s property.  His view is that people commonly own only the “first few feet” below ground.  The Land Registry however is quite clear that ownership varies – from owning the underground (called “mines and minerals”) outright to someone else owning the “mines and minerals” with extraction subject to the surface owner’s agreement.

In all cases it appears that contrary to recent comment, the Crown does not own the “mines and minerals” by default[4].  Ownership can only be determined by consulting the deeds of the previous owners of a piece of land – who may or may not have sold the rights to someone else separately.


[1]  Royal Society (2012) Shale Gas Extraction in the UK: Review of Hydraulic Fracturing (Fracking).

[2]  The economics of extraction have to include the costs of collection from the hundreds of well-heads which would be needed for significant flows, and their connection to the UK gas grid.

[3] 2014

[4]  HM Land Registry, Public Guide 25, updated December 2013.

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