News the Government has given the green light to fracking in Lancashire, overriding the objections of the local council, results in a big advance for prospective UK shale play IGas Energy (IGAS:AIM), up 30.7% to 15.7p.
Private operator Cuadrilla, the immediate beneficiary of this decision, is probably the most advanced shale operator in the UK but IGas is the London-listed with the largest shale portfolio.
Communities secretary Sajid Javid rules Cuadrilla can drill and frack four horizontal wells on its Preston Road site near Blackpool and defers judgement on a similar work programme at the nearby Roseacre site but says he is 'minded to allow' the project if concerns over traffic can be overcome.
IGas announced late last night that a planning decision on its own Springs Road site in Nottinghamshire had been delayed to 15 November after the submission of a late legal representation.
The complex planning process, coupled with greater population density, are two reasons many observers are sceptical the shale revolution witnessed in the US can be repeated in the UK.
IGas shares have come under pressure as it tries to negotiate a relaxation of covenants with its bondholders. Cash flow from its conventional oil and gas assets has been pressured by falling commodity prices.
