Ineos offers £2.5bn to communities disrupted by shale gas

“Shale gas won’t be successful in the UK unless people see there is some upside or benefit,” Jim Ratcliffe, chairman of Ineos, said yesterday in an interview with the Sunday Times.

However, Ineos’s pledge has taken the rest of the industry by surprise and potentially opens up a divide within the sector. Under a “Community Engagement Charter” through trade body UK Onshore Oil & Gas (UKOOG), energy companies have committed to pay 1pc of revenues once a shale gas site is producing, as well as £100,000 per site during the exploration and development process.

A spokesman for UKOOG said: “I think we knew Ineos wanted to come along with a proposal but we had not seen any figures from them.”

Ineos, which is an associate member of UKOOG, denied that creating a split was its intention. Tom Crotty, Ineos director, said: “We did not talk to UKOOG because we believe it is our business to manage as we choose but it is not about throwing down the gauntlet to the rest of industry.”

He added the 6pc offer was not an attempt to buy off the public over shale gas: “We do not see it that way. The rest of the industry had a position and we felt we had a different position.

“We have come into come shale as a user and got to know the US side,” Mr Crotty said. “A key part of the way the Americans go about their business is to have a big share of it benefit the community .

“There is no hiding shale causes disruption, it’s like have a building site for six months but after that you have 20 years of peace and quiet when the well just quietly produces gas.”

He said shale gas in the UK is “stalled” and needs a fresh approach to explain its benefits to the public, with only negative messages about its impact currently getting through to the public.

Others players in the shale industry played down Ineos’s proposal.

Ken Cronin, UKOOG chief executive, said: “Ineos’s proposal relates to the production phase of natural gas from shale, which is still some years off, and the focus in the next few years will be drilling exploration wells and determining how much of the gas underneath licence areas is economically recoverable.”

A spokesman for IGas, which is attempting to buy Dart Energy, which owns the 49pc of PEDL 133 not owned by Ineos, said: “The contribution to the communities in which we operate is wider than a percentage of revenue and includes the economic benefit of jobs, investment in skills and apprenticeships, business rate retention for local councils and regeneration through inward investment.”

John McGoldrick, chief executive of Dart Energy said: “Discussion on the percentage available from revenues is purely academic until we as an industry drill and frack more shale gas exploration wells.”

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