Simon Colvin, Partner at law firm Weightmans, explains why the UK government’s continued support for fracking activity, presents both risks for water companies and a number of opportunities.
Pros
There is the opportunity for water utilites to provide the significant volumes of water needed for the fracking process and to negotiate commercial agreements with operators to supply this water, as well as managing the wastewater generated by the fracking process.
Cons
The risks come in the form of possible threats to drinking water supplies.
The very high water demand of the fracking process mean operators may seek to extract water from local sources adding to the pressure on already water stressed catchments. Wastewater often needs to be tankered away for specialist treatment due to its low level radioactive properties. The main risk comes from significant spills and leaks of this wastewater that has the potential to significantly impact surface water features.
In other regions where drinking water supplies come predominantly from the ground, geological features often mean the direct risk of cross contamination between the shale deposits and drinking water aquifers is limited. However there is a risk if, in constructing wells, these distinct zones are linked - providing a pathway for the cross contamination of drinking water supplies.
In recent days there have been reports of operators seeking to re-inject this wastewater into the ground. This is something that requires careful consideration by and consent from the Environment Agency, but it is an activity that clearly poses a significant risk to groundwater sources if not regulated and managed properly.
Legal issues
The questions arise as to what if something did go wrong and a drinking water source was affected - would an operator have the financial resources to be able to remediate the impact? How long might that take and what would be done while any works were ongoing? There are environmental liability regimes that account for these eventualities but they only work effectively if the operator is still in existence and has the financial ability to fund any necessary works.
It is the view of DECC that the existing controls provide adequate protection from the environmental risks associated with fracking. However, a number of commentators are concerned at the fragmented regime that is meant to deliver this protection.
Oddly water companies are not statutory consultees for the purposes of applications for the various consents required for drilling activities. The impact on water supplies will inevitably be a consideration of any environmental impact assessments, but that is not the same as approaching the appropriate water company and seeking their views on the proposed activities, especially in light of the significant knowledge and information they will inevitably hold.
The difficulty is that according to a BGS study published in the summer 50% of the significant aquifers in the UK overlap with shale deposits meaning at some point there will be a conflict between the two. Protected areas also cover large parts of the UK and so while shale gas operators will be able to avoid these areas at least initially, they cannot do so indefinitely.
It’s clear that water companies have a large part to play in the future of fracking in the UK and that role is likely to become more central as the fracking sector continues to grow. Water companies through bodies such as Water UK need to ensure they are part of the debate so their interests are accounted for in this fast growing sector.
Simon Colvin, Partner and National Head of the Environment Team at Weightmans
