The announcement from the company reignited a huge row both north and south of the Border over escalating environmental concerns associated with the practice and timescales involved.
The Swiss-based company already has two licences covering 120,000 acres near its massive Grangemouth plant in central Scotland, and is separately spending £400m on building facilities there, to take cryogenically frozen shale gas from the US.
It is now applying for further UK licences, overwhelmingly in Scotland and the north of England, to turn it into the UK’s leading producer.
Ineos chairman Jim Ratcliffe signalled the latest move was a robust statement of intent by the company – which came to the brink of closing Grangemouth last year in a bitter dispute over pay and working conditions – to become the biggest player in the UK fracking industry.
Fracking, or hydraulic fracturing, involves pumping water, chemicals and sand at high pressure underground to release gas from shale rock.
Shale gas currently covers about half of the energy requirements of the US, but has provoked protests by environmental groups and some politicians that it is a relatively untried process with uncertain long-term geological impact.
• Leaders: Ratcliffe must remove risk to secure shale gas rewardsMr Ratcliffe claimed shale gas could be “the saviour of manufacturing” in the UK, as North Sea energy reserves run down, and with British manufacturers paying double the price for electricity than in the US and three times the price for gas.He added: “I believe shale gas could revolutionise UK manufacturing and I know Ineos has the resources to make it happen, the skills to extract the gas safely and the vision to realise that everyone must share in the rewards.”He said that if Ineos got the licences it wanted, it would immediately propel Grangemouth “back into the premier league of energy”, and make the loss-making plant profitable very quickly. He said a lot of the gas produced by UK fracking would be used at Grangemouth.Gary Haywood, Ineos Upstream chief executive, said: “We believe our knowledge and experience in running complex petrochemical facilities means that Ineos will be seen as a very safe pair of hands.”The company is also supplying financial sweeteners to communities in areas where drilling takes place. It said it would give local communities 6 per cent of revenues from any shale gas it produces, with 4 per cent going to homes and landowners above the well and 2 per cent to the wider local community. CONNECT WITH THE SCOTSMAN • and get the latest news, sport and business headlines delivered to your inbox every morning• You can also follow us on , and The company said this offer could be worth between £350m and £400m over ten to 15 years.Mr Ratcliffe said many people could become millionaires, adding: “That’s fine. America has a fair share of those.” Mr Haywood said that people sitting on large amounts of land that were affected by fracking could “do very well out of it. This is a material offer. It is not small”.However, environmental groups hit out the prospect of significant shale gas production in Scotland. Mary Church, Friends of the Earth Scotland’s head of campaigns, accused Ineos of “creating a huge amount of hype around an announcement with very little substance at its core”.She said the shale gas industry was in “its absolute infancy” and would take many years to get near commercial production, “if indeed it ever does”.Ms Church added: “Scotland does not need unconventional gas to meet our energy needs, and extracting and burning it will jeopardise our climate targets and expose local people to unacceptable health risks.“In a country that produces seven times more hydrocarbons than we consume, and acknowledges the urgency of climate change, it would be utterly irresponsible to open up a new frontier of fossil fuels.”Simon Clydesdale, energy campaigner at Greenpeace UK, said: “Investment is essential to transform our energy system, but not giant speculative bets on unproven and risky resources. Ineos have jumped on a spin-powered bandwagon which is going nowhere.” Ineos has dismissed opposition to fracking as largely based on misconceptions about the risks. A Scottish government spokesman said: “The Scottish government believes that we should proceed cautiously and take an evidence-based approach to unconventional oil and gas extraction, including ensuring strong environmental protection.”BackgroundDrilling technique that has fanned fears of pollutionfracking is shorthand for “hydraulic fracturing” a means of releasing oil, but mainly natural gas, from subterranean rock layers. The technique was first utilised in 1947 – however modern fracking was devised in 1998 and has since made the extraction of shale gas economical, particularly in America where there is a current boom.The system involves drilling vertically and then turning the drill and pipeline horizontally so that it penetrates areas of shale rock.A mixture of chemicals, sand and water is then injected at high pressure down the pipeline in such a way that it is directed into the rock which then fractures. This releases gas which then flows back up the well to the surface.Supporters of fracking point out that it makes huge supplies of natural gas accessible and has allowed both America and Canada to achieve the prospect of gas security for the next century.However, critics argue that this comes at a huge environmental cost. First, the process requires massive amounts of water which must be transported to the drill site. The chemicals used in the process are potentially carcinogenic and there are concerns that they could contaminate the groundwater around the site. There have been incidents of pollution but the industry insists that this is as a result of bad practice rather than an inherently risky technique, but environmental critics dispute this point. Man-made fracturing of subterranean rocks can cause small earthquakes. When fracking was taking place near Blackpool in 2011, two small earthquakes were recorded with magnitudes of 1.5 and 2.2 on the richter scale. Professor Ernie Rutter, professor of structural geology at the University of Manchester, said: “It’s always recognised as a potential hazard of the technique. But they’re unlikely to be felt by many people and very unlikely to cause any damage.” The earthquakes led to the suspension of fracking between June 2011 and April 2012. However, a report into the incidents concluded that the risk of earthquakes was minimal and that the process should be permitted. In January 2014 the European Union approved fracking under certain conditions. A key criticism among environmentalists is that fracking perpetuates the reliance on fossil fuels, and that instead the government and energy companies should be focusing on securing renewable sources of energy.SEE ALSO• Calls to ease fracking regulations
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