JS Ineos Insight arrived today at the Grangemouth petrochemical plant, carrying the first consignment of fracked shale gas from the American Midwest. Its arrival highlights Scotland’s ambiguous position on whether to say yes or no to fracking.
The Scottish Government’s fracking moratorium remains. The issue was first examined by an Independent Expert Scientific Panel in 2014, which concluded: “There could be positive economic impacts from the development of an unconventional oil & gas industry” and, while technical challenges existed: “The technology exists to allow the safe extraction of such reserves, subject to robust regulation being in place”.
Facing public opposition, the Scottish Government announced a moratorium in January 2015 to allow examination of key issues; it was extended in October 2015 and a timetable for further research and consultation (yet to begin) was agreed, to conclude in Spring 2017.
However the arrival of the Insight puts the Scottish Government’s position firmly in the spotlight. If there are environmental and health risks in agreeing to fracking in Scotland, is it morally acceptable to process the self-same gas sourced in the USA? Alternatively, if the gas was extracted safely in the States, then might not the same technology allow safe extraction in Scotland?
The debate takes place in the context of a massive decline in North Sea revenues and a growing deficit. The Government had estimated that some £8bn would be raised in financial year 2015/16; in the event the figure was a meagre £60m, and the deficit now stands at £15bn.
Don’t forget that Ineos’ $2bn (£1.415bn) investment in Grangemouth saved the plant from closure and the loss of 1,300 jobs. Ineos Chief Executive, Jim Ratcliffe, estimates that the total contribution of imported US ethane will account for 10% of Scottish GDP, adding: “Whether the Scottish politicians like it or not, the shale gas which has come from the US rather than Scotland has saved 10,000 jobs in the Falkirk area”.
And the SNP is concerned about future economic growth. It has a ‘Growth Commission’ to examine how to grow the economy in the event of Scottish independence, post Brexit. The Commission is to provide an initial report to the First Minister by year end.
Whatever the views of the individual Commission members, they cannot avoid making a judgement on the role fracking could play in boosting the Scottish economy. And at some point the Scottish Government has to say yes or no.