Fracking: What could Shale Gas do for Scotland?

From delivering new jobs and investment in local communities to even sharing in the revenue made, shale gas extraction would help reignite the Scottish economy.

Extracting domestic shale gas to meet our needs, rather than relying on imports, would have significant economic benefits for Scotland and the rest of the UK. A Department of Energy and Climate Change report estimates that 16,000-32,000 full-time jobs would be created in the gas industry and wider supply chain, many of them in Scotland, while studies from Ernst and Young and the Institute of Directors (IoD) estimate the figure could be over twice this.

Exploration is necessary to better understand the economics, but it’s possible that shale gas could help reinvigorate and rebalance the economy.

This could be particularly beneficial in Scotland, where shale gas extraction could replace jobs and tax revenues lost as North Sea oil production declines. Communities would benefit from significant investment, new jobs and local tax revenue if extraction went ahead.

And they would receive a share of revenue from extraction, which could have a substantial impact on regional economies and local public services.

We have promised to share six per cent of revenue from shale gas, four per cent of which would go to homeowners and landowners in the immediate vicinity of a well and a further two per cent to the wider community. Based on our estimates, a typical 10km by 10km development area would generate £375million for the area over its lifetime.

Shale gas is also an opportunity to reduce our gas import dependence in other countries for our energy needs. The British Geological Survey estimates that central Scotland contains 80 trillion cubic feet of shale gas.

Assuming that 10 per cent of this could be extracted, this would produce enough to meet Scotland’s gas needs for decades to come. It’s vital to undertake initial exploration in test wells to understand how much can be extracted, but it is a real possibility that shale gas could provide a secure supply of transition fuel and gas feedstock for Scotland, which would be playing to its strengths, securing its position as an energy exporter.
Shale gas is an opportunity that Scotland and the rest of the UK cannot afford to overlook. Extracting shale gas is an opportunity for the UK to reduce its dependence on imported gas while creating potentially tens of thousands of jobs and generating significant tax revenue and growth.

It is especially important to the future of the UK chemicals industry, which is significantly located in Scotland, and could have sizeable benefits for local communities. Respected authorities such as the Royal Society and the Committee on Climate Change recognise that extraction can be managed safely while meeting our carbon reduction commitments. With the US and China extracting shale gas and Germany recently issuing a draft law to enable exploratory fracking, the UK cannot afford to overlook this opportunity and risk being left behind.

This is why we believe it is essential to undertake public consultation and exploration to better understand what shale gas could mean for the UK and demonstrate its safety in order to win a social licence. Natural gas is essential for the modern world, and many of the benefits it brings cannot be replaced by renewables.


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