Reaction to fracking go-ahead

Environmental groups such as Friends of the Earth also cite reports warning that fracking could “potentially contaminate” groundwater due to the chemicals used in the process; will increase noise and industrialization in quiet rural areas; uses large amounts of water; and risks further earthquakes of unpredictable frequency and strength.

Cuadrilla says the clay on its site is “very well suited” to fracking and that it would conduct daily seismicity monitoring if operations restart. It also says that polyacrylamide — the chemical it uses — has been assessed by the Environment Agency as non-hazardous to groundwater and forms 0.05% of frack fluid.

A report commissioned by the government in April and published Thursday found it was still not possible to accurately predict geological activity as a result of U.K. fracking operations. But in a reversal of its 2019 position, the government now says more sites will need to be drilled to investigate further, while Rees-Mogg told the BBC this week the government will look to raise the level of seismic activity allowed at fracking sites going forward.

Some investors certainly see potential for a restart in operations, with shares of onshore oil and gas company Egdon Resources — listed on the U.K.’s Alternative Investment Market — up 6.3% Thursday and up 365% this year.

However, analysts say many hurdles remain, not least regulation, environmental concerns and the operational complexities. The are four main areas identified as potentially viable for shale gas extraction and more than 100 sites have been granted exploration licenses for fracking, but these still need permits from various regulatory bodies to progress further, along with political backing.

“While currently high energy prices may improve the potential economic viability of fracking in the UK, it may be less certain over the longer term,” Tobias Wagner, senior credit officer at Moody’s, told CNBC.

“It remains to be seen to what degree companies are willing to invest at scale given the uncertainties and concerns,” he said.