Fracking company told to submit overdue accounts before Kirby Misperton decision

A company has been told by the government to submit its financial accounts before a decision can be made on whether it can frack in Ryedale or not.

Friday, 26th January 2018, 8:51 am
Updated Friday, 26th January 2018, 8:55 am
The KM8 site at Kirby Misperton, on the right of this photo

Third Energy's proposal to frack for natural gas at Kirby Misperton, near Pickering, is currently being considered by Greg Clark, Secretary of State for Business, Energy and Industrial Strategy.

Mr Clark has informed the Oil and Gas Authority that he is satisfied that the 13 technical requirements set out in the Petroleum Act 1998 have been met. But he has asked Third Energy to submit its 2016 accounts, which are overdue by nearly four months.

A spokesperson for Third Energy said: “After almost four years of planning and preparation, we are delighted that the Secretary of State is satisfied that Third Energy has met all of the 13 technical requirements set out in section 4A of the Petroleum Act 1998. Our annual accounts are being finalised and we will now be working with the Infrastructure and Projects Authority and the Oil and Gas Authority towards achieving hydraulic fracturing consent from the Secretary of State.”

Guy Shrubsole, Friends of the Earth campaigner, said: “This is further confirmation of the shaky foundations that this industry is built on. Third Energy are again late filing their accounts and questions remain about their ability to restore their fracking site if it goes wrong, as well as their wider financial health.

"Given also that one of their directors (John Dewar) has just left, and another is the Carillion chief executive (Keith Cochrane), this is not the company to inspire confidence. It’s time for Barclays to stop supporting this company, as they said they’d do at their AGM last year and, more significantly, it’s time government stopped backing this industry.”

Mr Clark, in a written statement, said an assessment should be taken "of the financial resilience of companies proposing to carry out hydraulic fracturing operations so that stakeholders can have confidence in the company’s ability to meet its commitments.

"I note that as of 24 January Third Energy UK Gas Limited and other related companies had yet to submit their accounts for the accounting period ending in December 2016, despite a statutory deadline of 30 September 2017 for them to do so. I have therefore asked the Oil and Gas Authority to seek further financial information from the company, including the required set of up-to-date accounts, to inform my decision.

"I have also asked the Infrastructure and Projects Authority to assess the financial resilience of the applicant, including its ability to fund decommissioning costs. Once I have received this assessment I will inform the Oil and Gas Authority whether I am satisfied with the application as required by the 1998 Act."

Plannning permission for the Kirby Misperton KM8 site included a legal agreement, which required Third Energy to pay a deposit into a fund intended to cover the cost of site restoration and aftercare. Last month, a fund of £160,000 was agreed by North Yorkshire County Council and the company.

Ken Cronin, Chief Executive of UK Onshore Oil and Gas (UKOOG), said: "We are pleased that the Secretary of State is satisfied that Third Energy has met each of the 13 conditions as they prepare to hydraulically fracture in North Yorkshire. Final ministerial consent for any hydraulic fracturing is part of the robust regulatory regime we work within, and we therefore look forward to Third Energy working with the Oil and Gas Authority and the Infrastructure and Projects Authority to satisfy the additional requirements requested of them."