Centrica agrees Northern England fracking deal with Cuadrilla
The British Gas owner, Centrica, has bought a 25% stake in a venture license to drill for shale gas in Northern England from fracking firm Cuadrilla.
The deal will cost Centrica £100m and a further £60m if the company decides to move into a development phase.
Cuadrilla has already drilled three exploration wells in Lancashire and Centrica claims that the data obtained from them has confirmed the "shale formation thickness" and the presence of natural gas.
The company says initial data suggests that there could be 200 trillion cubic feet (tcf) of gas in place within Cuadrilla's Bowland Shale licence in Lancashire but that further drilling will be required to establish whether the discovery is commercially viable.
Centrica's International Upstream business managing director Mark Hanafin said: "With North Sea gas reserves declining and the UK becoming more dependent on imported gas supplies, it is important that we look for opportunities to develop domestic gas resources, to provide affordable sources of gas to our customers, and to deliver broader economic benefits to the UK."
However, green campaigners have reacted with anger claiming that Centrica would further damage its already tarnished reputation from "raking in huge profits on the back of rocketing fuel bills."
Friends of the Earth's energy campaigner Tony Bosworth said: "People are right to be concerned about the impacts of developing shale gas. It undermines efforts to tackle climate change, poses a pollution threat to drinking water and - as even Cuadrilla admits - won't cut fuel bills.
"Instead of embarking on new fossil fuel adventures it's time Centrica came forward with solutions for meeting our carbon targets - we should be developing affordable clean British energy from our wind, waves and sun."