There are very few more pressing issues on the planet right now than climate change, and sustainable energy. For that reason alone, throwing dangerous chemicals down a well and splitting rocks to extract gas, leading to complaints of contaminated water supplies in Texas, and earthquakes in Blackpool, was always going to be a controversial topic. Without getting into the pros and cons of the industry and the practice, I thought I’d focus on the names and faces attached to fracking in the UK, who seem to be extraordinarily close to a government that is now suddenly fully embracing fracking.
Lord Browne is the Managing Director of Riverstone – a private equity firm that backs Cuadrilla Resources (of which Lord Browne in the Chairman). Cuadrilla is a Shale Gas operator that was found to be the likely cause of two minor earthquakes in 2011 through its drilling in Lancashire. Lord Browne is lead non-executive director – a Coalition advisor – at the Cabinet Office and a crossbench member of the House of Lords.
Also at Riverstone was Ben Moxham. Moxham was a vice President at Riverstone – the equity firm that backs a company responsible for a small earthquake – until 2011. Moxham was then a lead advisor for the Coalition on climate change issues, and a senior policy advisor for energy issues, to the Prime Minister. Moxham, like Lord Browne, was also at BP for a time.
The Senior Independent Director of of BG Group PLC is Baroness Hogg. BG Group is a British oil and gas company with interests across the planet, including shale gas in the US, where it claimed to be wishing to produce 80,000 barrels a day by 2015, growing up 190,000 barrels a day by 2020 through its shale production. Baroness Hogg was appointed Lead Non-Executive Board Member to the Treasury.
Sam Laidlaw is the CEO of Centrica. He was also Lead non-executive director on the board of the Department for Transport, and a member of the Prime Minister’s Business Advisory Group . Also at Centrica for a time, was Tara Singh. In May 2013, Number 10 announced that Ms Singh would be the Prime Minister’s personal advisor on energy and climate change. This is the same Tara Singh whose previous role was Public Affairs Manager at Centrica – owner of British Gas. A few weeks after Singh was appointed to a government advisory role, Centrica – her former employer – bought a stake in Lord Browne’s Cuadrilla for its shale gas production. Singh has also worked for PR firm Hill & Knowlton, a firm that represents the Norwegian energy giant Statoil, a company with investment in fracking in North America.
Lord Green, the Minister of State for Trade and Investment, was also non-executive director of chemical giant BASF. BASF supply gas-based chemicals for the fracking industry.
The Windsor Energy Group in March 2013 discussed, according to its own documents:
“…the energy revolution from shale gas and tight oil and other game-changers so far looking east, west and south…”
– This excitement was echoed by the Chairman of the Windsor Energy Group – Lord Howell – who told Parliament that the former colonies were ripe for picking:
“…wake up and realise where our future and our destiny lie…the new range of Commonwealth countries coming into the prosperity league either side of Africa, as they find through the shale gas revolution that they have fantastic raw energy resources and prospects.”
– Lord Howell – the Chairman of the W.E.G – also happens to be the father-in-law of Chancellor George Osborne. The Windsor Energy Group takes time on its website to thank Shell and BP for its support. It is unsurprising that two of the biggest players in the oil industry might choose to be close friends with an organisation whose chairman is the father-in-law of the Chancellor. Lord Howell was also former energy advisor to William Hague.
Lord Howell – the Chairman of the W.E.G and father-in-law of the Chancellor – is also the President of the British Institute of Energy Economics. The BIEE is sponsored by Shell and BP. In 2013, Howell was appointed President of the Energy Industries Council.
It comes as no surprise then, that in July 2013, Howell’s son-in-law Chancellor George Osborne announced a massive tax break for the fracking industry, setting the rate at 30% for onshore shale gas production, as opposed to 62% for new production of North Sea Oil. Echoing the wording by his father-in-law, and the Windsor Energy Group that his father-in-law Chairs, Osborne referred to fracking as a revolution:
“This new tax regime, which I want to make the most generous for shale in the world, will contribute to that. I want Britain to be a leader of the shale gas revolution”
– But it isn’t just Osborne. Vince Cable, whose Party spent the best part of the last decade insisting it was the party of green energy, took to TV news to defend the tax breaks. The fact that Cable here suggests that fracking would have to be heavily regulated and watched, must raise eyebrows as to its potential dangers. It is worth noting that Vince Cable was the former Chief Economist at Shell (supporters of the W.E.G, and financial backers of the BIEE, both run by George Osborne’s father-in-law) and that Malcolm Brinded – the former Chief Executive of Shell Upstream International – referred to Cable in a letter to the Secretary of State as the “Contact Minister for Shell”. Here:
The tax breaks must have felt like a wonderful victory, not just for Shell and Osborne’s father-in-law, but for everyone’s favourite soulless lobbyist Lynton Crosby. The Prime Minister’s election advisor and strategist founded the lobbying firm Crosby Textor, which lobbies on behalf of The Australian Petroleum Production and Exploration Association, and fracking is one of its main objectives. One of the members of The Australian Petroleum Production and Exploration Association is Dart Energy, whose UK subsidiary holds a fracking licence in the UK.
So to summarise, Lord Browne from Cuadrilla is a coalition advisor, and Tara Singh from Centrica who own a stake in Cuadrilla is a coalition advisor, and Sam Laidlaw – the CEO of Centrica – was a coalition advisor. Baroness Hogg – a lead non-exec. board member to the Treasure – is Senior Independent Director at a company with huge interests in fracking in the US Ben Moxham – an advisor to the Prime Minister on climate change and energy – was at an equity firm that backed Lord Browne’s Cuadrilla. Lynton Crosby whose firm lobbies on behalf of the fracking industry is a key strategist to the Conservative Party. George Osborne’s father-in-law is the President of a group financially backed by BP & Chairs another organisation supported by Shell among others that pushes for the fracking industry at the same time that his son-in-law announces incredibly generous tax rates for the fracking industry. And the Business Secretary is referred to as the “Contact Minister for Shell” by a former Shell CEO. It is an incredible state of affairs.
Those who are in a position to be making a very large amount of money from fracking, also appear to be at the centre of a government that will make the key decisions on the future of the industry including its regulations and safety procedures. By contrast, there don’t appear to be any members of local communities close to proposed fracking sites, at the centre of government. For a Tory Party needing to shed its image as the Party of big business, this isn’t helping. The fracking industry hasn’t even taken off in the UK to any great extent, and yet it would appear its representatives are well placed right at the very heart of government.