Regulating onshore oil and gas
Welsh Government policy on onshore petroleum extraction
Welsh Ministers assumed responsibility for the licensing of onshore petroleum extraction from the 1st October 2018.
In December 2018 in a written statement Welsh Government announced its policy ‘To not undertake any new petroleum licensing in Wales, or support applications for hydraulic fracturing petroleum licence consents.’
Despite Welsh Government’s policy, NRW has a statutory duty to carry out its regulatory role.
Our role as regulator
We are the environmental regulator for onshore oil and gas operations in Wales. We help ensure that onshore oil and gas operations are conducted in a way that protects people and the environment.
We assess individual onshore oil and gas proposals according to a number of different legislative requirements, the primary legislation we consider permit applications for these activities is the Environmental Permitting Regulations. As a regulator of the Environmental Permitting Regulations, NRW has a statutory duty to objectively consider any permit application it receives for onshore oil and gas exploration. We therefore continue to assess and determine any permit application for such schemes and will grant consent if all potential effects can be acceptably managed and permit requirements are met. In so doing we will continue to fulfil our regulatory role to manage risks to people and the environment when determining applications involving petroleum extraction in Wales.
We regulate emissions, the use of water, the protection of groundwater and the management of wastes such as drilling muds, flow back fluid (hydraulic fracturing fluid that is returned to the surface), gases and any naturally occurring radioactive materials (NORM). We have the authority to stop an operation if a significant hazard becomes apparent.
We will therefore continue to provide pre-application advice to developers on the potential environmental and landscape impacts at a site in accordance with our charging scheme.
For any site granted a permit our monitoring and compliance role at each site ensures that the environmental risks are properly managed through audits, site inspections, spot check monitoring and reviewing operator records and procedures.
We also consider permits, licences and consents to determine the potential impact of a proposal on European Protected Sites and Species.
Permits and licences required
Our role as advisor in the town and country planning system
Planning permission is required before starting any oil or gas exploration or extraction development.
If a local planning authority does not propose to refuse an application for a petroleum development, they must notify Welsh Ministers. The Welsh Ministers may choose to call in the planning application, or if appropriate issue a direction that the application may not be approved until such time as directed by the Welsh Ministers. It should be noted that this does not prohibit schemes. However, Planning Policy Wales sets out Welsh Government’s objective ‘to avoid the continued extraction and consumption of fossil fuels.’ Applicants will have to provide robust and credible evidence showing that their proposals conform to the energy hierarchy and how they contribute to decarbonising the energy system.
NRW will be expected to continue to provide advice to developers and local planning authorities when consulted for such schemes where they affect our interests.
Our role as land manager
We manage 7% of Welsh land on behalf of the people of Wales, including 120,000ha of woodland, 42 National Nature Reserves and five Visitor Centres. As a land manager NRW must give due consideration to any requests for access to land that it manages, and each application will be considered on its own merits. However, under current Welsh Government policy on petroleum extraction, an application for petroleum exploration and/or development is likely to be refused.
Our approach is also informed by Welsh Government’s Climate Emergency declaration. NRW declared its support for the climate emergency and committed to deliver a range of decarbonisation measures under three areas; mitigation, adaptation and behaviour change. The NRW Board is supporting action on the following work areas through endorsement of the Carbon Positive Project’s Enabling Plan:
- better management of our forests to increase carbon storage and extensive peatland restoration to minimise their emissions;
- considering further significant afforestation through expansion of the woodland estate;
- exploring more opportunities to generate renewable energy on NRW managed land
Granting access to land that NRW manages for the purpose of petroleum extraction could be considered as contrary to Welsh Government’s Petroleum Extraction Policy and our ongoing work to counteract the climate emergency.
Regulation in Wales
We work closely with the following bodies to regulate onshore oil and gas activities. Through effective joint working, we ensure that onshore oil and gas activities in Wales are managed in ways that protect the environment and people.
- The Oil and Gas Authority (OGA) licenses each drilling and development activity in England. From the 1st of October 2018 the Welsh Ministers assumed responsibility for the licensing of onshore petroleum extraction in Wales. Welsh Ministers are responsible for maintaining existing Petroleum Exploration and Development Licence (PEDL), which gives an operator exclusive rights to prospect for conventional and unconventional oil and gas in a licensed area. No exploration or production activity can start without a PEDL, planning and permitting permission
- Local planning authorities are responsible for granting planning permission (under the Town and Country Planning Act 1990) for surface-related developments
- The Coal Authority is responsible for granting consent for activity which cuts across, disturbs or enters coal seams
- The British Geological Society requires information on any borehole that is intended to penetrate to a depth greater than 100 feet as well as information about the deepening of an existing well
- The Health and Safety Executive is responsible for ensuring safe practices in well design, integrity and construction work, and for safety with regard to drilling work
- The Crown Estate covers some 115,500 hectares in the land area of Great Britain. Ownership of oil and gas within that area is vested in the Crown
BEIS Regulatory Roadmap
Natural Resources Wales worked with the BEIS and the Welsh Government to produce a Regulatory Roadmap. The map provides a useful overview of the permitting and permissions process for shale gas and coal bed methane exploration, highlights key regulatory and advisory bodies, related legislation and regulation, and also identifies required actions and best practices at various stages.
Underground coal gasification is subject to a different regulatory regime to shale gas and coal bed methane (as the processes and associated hazards are different).
The Infrastructure Act 2015 and Hydraulic Fracturing Safeguards
The Infrastructure Act 2015 contains specific provisions relating to energy exploitation, including a number of safeguards that must be completed before the Oil and Gas Authority will issue operators with consent to undertake hydraulic fracturing. Operators must meet twelve safeguard conditions to obtain the consent. Many of the safeguard conditions relate to environmental protection, for example twelve month’s groundwater methane monitoring, fugitive emissions monitoring, and assessment and disclosure of chemicals.
These safeguard are only applicable where an operator is seeking consent to undertake hydraulic fracturing (as defined within the Act), and do not apply to the drilling of exploratory boreholes or coal bed methane activities. The safeguards are also additional to the requirement to obtain the relevant planning and environmental permitting consents.
It should be noted however, that hydraulic fracturing is not supported in Wales.